EXHIBIT 10.48
Execution Copy
Dated 27 July 2004
CHINA NETCOM CORPORATION INTERNATIONAL LIMITED
(as Mortgagor)
in favour of
INDUSTRIAL AND COMMERCIAL BANK OF CHINA (ASIA) LIMITED
(as Security Trustee)
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DEED OF MORTGAGE OF SHARES
in Asia Netcom Corporation Limited
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XXXXXXXX XXXXXX
HONG KONG
[Mortgage of Shares]
TABLE OF CONTENTS
CLAUSE NO. CLAUSE HEADING PAGE NO.
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1. DEFINITIONS AND CONSTRUCTION.......................................................................... 1
2. COVENANT TO PAY....................................................................................... 3
3. MORTGAGE AND ASSIGNMENT............................................................................... 3
4. CONTINUING AND INDEPENDENT SECURITY................................................................... 6
5. REPRESENTATIONS AND WARRANTIES........................................................................ 8
6. TAXES AND OTHER DEDUCTIONS............................................................................ 11
7. COSTS, CHARGES AND EXPENSES........................................................................... 12
8. UNDERTAKINGS.......................................................................................... 13
9. ENFORCEMENT........................................................................................... 14
10. DIVIDENDS AND VOTING RIGHTS........................................................................... 16
11. APPLICATION OF PROCEEDS............................................................................... 17
12. INDEMNITY............................................................................................. 17
13. SUSPENSE ACCOUNT...................................................................................... 18
14. SET-OFF............................................................................................... 18
15. POWER OF ATTORNEY..................................................................................... 19
16. FURTHER ASSURANCE..................................................................................... 19
17. NOTICES............................................................................................... 20
18. WAIVERS, AMENDMENTS AND CONSENTS, REMEDIES, SEVERABILITY, ASSIGNMENT AND COUNTERPARTS................. 21
19. GOVERNING LAW AND JURISDICTION........................................................................ 22
SCHEDULE 1 - PARTICULARS OF THE SHARES............................................................................ 24
SCHEDULE 2 - FORM OF INSTRUMENT OF TRANSFER....................................................................... 25
SCHEDULE 3 - FORM OF LETTER OF RESIGNATION........................................................................ 26
SCHEDULE 4 - FORM OF WRITTEN RESOLUTION........................................................................... 27
SCHEDULE 5 - FORM OF AUTHORISATION FROM DIRECTORS/SECRETARY....................................................... 28
SCHEDULE 6 - FORM OF LETTER OF UNDERTAKING........................................................................ 29
SCHEDULE 7 - FORM OF ACKNOWLEDGEMENT OF NOMINEE................................................................... 30
EXECUTION PAGE ................................................................................................... 31
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THIS DEED OF MORTGAGE OF SHARES is made on 27 July 2004
BETWEEN:-
(1) CHINA NETCOM CORPORATION INTERNATIONAL LIMITED, a company incorporated
under the laws of Bermuda, and whose registered office is situate at
Xxxxxxxxx Xxxxx, 0 Xxxxxx Xxxxxx, Xxxxxxxx XX00, Xxxxxxx (the
"MORTGAGOR"); and
(2) INDUSTRIAL AND COMMERCIAL BANK OF CHINA (ASIA) LIMITED, a company
incorporated under the laws of Hong Kong through its head office at ICBC
Xxxx Xxxxxxxx, 000-000 Xxxxx'x Xxxx Xxxxxxx, Xxxx Xxxx acting on its own
behalf and as facility agent and trustee for and on behalf of the Finance
Parties (the "SECURITY TRUSTEE").
WHEREAS:-
(A) By a facility agreement signed on 2 December, 2003 (but held undated in
escrow), as released from escrow and amended and restated by the
Supplemental Amendment and Restatement Deed (the "FACILITY AGREEMENT")
entered into by (1) Asia Netcom Corporation Limited, as borrower (the
"BORROWER"); (2) the banks and financial institutions named therein as
lenders (the "LENDERS"); (3) Industrial Commercial Bank of China (Asia)
Limited as arranger; and (4) the Security Trustee as facility agent, the
Lenders have agreed, upon and subject to the terms of the Facility
Agreement, to make available to the Borrower a term loan facility of up to
US$150,000,000 (the "FACILITY") for the purposes more particularly
specified therein.
(B) The Security Trustee is acting as facility agent for the Finance Parties
pursuant to the Facility Agreement and as security trustee for the Finance
Parties pursuant to this Deed and the other Finance Documents.
(C) It is a condition precedent to the availability of the Facility that the
Mortgagor shall have executed and delivered this Deed to the Security
Trustee.
NOW THIS DEED WITNESSES as follows:-
1. DEFINITIONS AND CONSTRUCTION
1.1 TERMS DEFINED
In this Deed, unless the context otherwise requires, terms used or defined
in the Facility Agreement shall have the same meaning or construction
and:-
"COLLATERAL" means the assets of the Mortgagor from time to time subject,
or expressed to be subject to the Security Interest constituted or
expressed to be constituted by this Deed or any part of those assets and
includes:-
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(i) the Shares;
(ii) all stocks, shares or other securities, rights, monies or other
assets (the "RELATED ASSETS") accruing, offered or issued at any
time by way of bonus, redemption, exchange, purchase, substitution,
conversion, preference, option or otherwise in respect of the Shares
or the above mentioned Related Assets;
(iii) all Dividends;
(iv) allotments, offers and rights accruing or offered in respect of any
Shares or the above mentioned Related Assets; and
(v) other rights and assets attaching to or deriving from or exercisable
by virtue of any right title or interest in or to any Shares or the
above mentioned Related Assets.
"DELEGATE" means a delegate or sub-delegate appointed under Clause 15.2.
"DIVIDENDS" means all dividends, interest and other sums received or
receivable by any person in its capacity as shareholder of the Borrower
and includes:
(i) the right to receive any and all such sums and all claims in respect
of any default in paying such sums; and
(ii) all forms of remittance of such sums.
"NOMINEE" means in respect of any Share held by a person as nominee or on
trust for the Mortgagor and who is described as "REGISTERED SHAREHOLDER IN
SCHEDULE 1".
"RECEIVER" means any receiver, manager, receiver and manager or other
similar officer appointed by the Security Trustee in respect of the
security hereby granted.
"SECURED OBLIGATIONS" means any and all moneys, liabilities and
obligations (whether actual or contingent, whether now existing or
hereafter arising, whether or not for the payment of money, and including,
without limitation, any obligation or liability to pay damages) which are
or may become due owing, or incurred by the Borrower or any other Security
Party which is a member of the CNC HK Group to any Finance Party under or
in connection with any Finance Document and/or all other obligations
hereby secured.
"SECURITY PERIOD" means the period from the date of this Deed up to the
date upon which all the Secured Obligations have been performed and
discharged in full to the satisfaction of the Security Trustee.
"SHARES" means in respect of the Mortgagor:
(a) all present and future shares in the Borrower, including the shares
issued and outstanding at the date of this Deed as described in
Schedule 1 (including any shares held by Nominee for and on behalf
of the Mortgagor);
(b) all warrants, options or other rights to subscribe for, purchase or
otherwise acquire those shares; and
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(c) all rights relating to any of those shares which are deposited with,
or registered in the name of, any depositary, custodian, nominee or
other similar person (including rights against any such person).
1.2 TRUST
All rights, benefits, interests, powers and discretions granted to or
conferred on the Security Trustee pursuant to this Deed shall be held by
the Security Trustee on trust for the benefit of itself as Security
Trustee and each other Finance Party from time to time. The Security
Trustee may do all acts within its powers to administer and manage the
trust constituted by this Clause including any full or partial release by
deed of the rights, benefits and interests conferred by Clause 3.1
(Mortgage) or the release of all or any part of the Collateral from this
Deed. The trust constituted by this Clause shall come into existence on
the date of this Deed and shall last for so long as any of the Secured
Obligations remain outstanding provided that for the purposes of the rule
against perpetuities, the perpetuity period applicable to the trust and
any dispositions made or to be made pursuant to this Deed and this trust,
is hereby specified as a period of eighty (80) years less one (1) day from
the date of this Deed.
1.3 CLAUSE HEADINGS
Clause headings and the table of contents are for ease of reference only
and shall be ignored in the interpretation of this Deed.
1.4 CONSTRUCTION
In this Deed, unless the context otherwise requires:-
(a) Clause 1.3 of the Facility Agreement shall be deemed incorporated in
this Deed mutatis mutandis as if set out separately in this Deed;
and
(b) references to the "MORTGAGOR", the "BORROWER", the "SECURITY
TRUSTEE", any "FINANCE PARTY" or any "LENDER" include, where the
context permits, their respective successors and permitted
transferees and permitted assigns in accordance with their
respective interests.
2. COVENANT TO PAY
The Mortgagor hereby covenants that it will on demand pay to the Security
Trustee and the other Finance Parties, the Secured Obligations when the
same become due for payment or discharge in accordance with the Finance
Documents.
3. MORTGAGE AND ASSIGNMENT
3.1 MORTGAGE
In consideration of the Lenders agreeing to make the Facility available to
the Borrower upon the terms and conditions of the Facility Agreement and
as a continuing security for
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the due and punctual performance and discharge of the Secured Obligations,
the Mortgagor as sole legal and beneficial owner of the Shares not held by
a Nominee and as beneficial owner of the Shares held by a Nominee hereby:
(a) mortgages and charges by way of first fixed charge to the Security
Trustee (as trustee for the Finance Parties) all its rights, title
and interest, present and future, in and to, the Collateral; and
(b) assigns, and agrees to assign absolutely to the Security Trustee (as
trustee for the Finance Parties) all its rights (including those
rights it may have against a Nominee), present and future, relating
to any of the Shares, including:
(i) its rights relating to or against any depositary, nominee or
similar person with whom any of the Shares may be deposited to
the extent of those Shares;
(ii) rights that it may have against any person to require delivery
to it of any of the Shares;
(iii) rights (contractually or otherwise) to give instructions
relating to the Shares; and
(iv) all claims for damages and rights to receive moneys due or to
become due for any reason whatsoever in respect of any of the
Shares,
including those rights it may have against a Nominee or Delegate.
3.2 DELIVERY OF DOCUMENTS
The Mortgagor shall forthwith upon execution of this Deed deliver or
procure to be delivered (as the case may be) to the Security Trustee each
of the following documents:-
(i) all original share certificates or such other documents evidencing
title in respect of the Shares;
(ii) instruments of transfer in the form of Schedule 2 duly executed by
the Mortgagor and/or its Nominee (as the case may be) in respect of
the Shares with the name(s) of the transferee(s), date and
consideration left blank;
(iii) undated letters of resignation in the form of Schedule 3 duly
executed by each of the directors and the secretary of the Borrower
as at the date of this Deed;
(iv) signed but undated resolutions of the directors of the Borrower
approving the resignation of the directors and the secretary
referred to in sub-paragraph (iii) above in the form set out in
Schedule 4;
(v) letter of authority to date the letters of resignation and board
resolutions respectively referred to in sub-paragraphs (iii) and
(iv) above in the form set out in Schedule 5 signed by all the
directors and the secretary of the Borrower;
(vi) letter of undertaking not to appoint any additional or substitute
directors in the
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form set out in Schedule 6 signed by all the directors of the
Borrower; and
(vii) letter of acknowledgement in the form set out in Schedule 7 from the
Nominees acknowledging the Security Interests constituted by this
Deed and agreeing to act in accordance with the instructions of the
Security Trustee.
3.3 PERFORMANCE AND INDEMNITY
Notwithstanding the foregoing, the Mortgagor shall remain liable to
perform all the obligations to be performed by it in respect of the
Collateral and shall discharge fully its obligations thereunder as they
become due and neither the Security Trustee nor any other Finance Party
shall have any obligation of any kind whatsoever thereunder or be under
any liabilities whatsoever in the event of any failure to perform its
obligations thereunder and the Mortgagor hereby indemnifies and agrees to
keep indemnified the Security Trustee and the other Finance Parties and
each of them from and against any such liability.
3.4 RELEASE AND TRANSFER
(a) The Security Trustee shall, upon the full performance and discharge
of the Secured Obligations to the satisfaction of the Security
Trustee and the Finance Parties, at the request and cost of the
Mortgagor and in such form and with such conditions as the Security
Trustee shall reasonably require, release and transfer and reassign
(as appropriate) to the Mortgagor the Collateral.
(b) Notwithstanding any discharge, release or settlement from time to
time between the Security Trustee and the Mortgagor, if any
security, disposition or payment granted or made to the Security
Trustee in respect of the Secured Obligations by the Mortgagor or
any other person is avoided or set aside or ordered to be
surrendered, paid away, refunded or reduced by virtue of any
provision, law or enactment relating to bankruptcy, insolvency,
liquidation, winding-up, composition or arrangement for the time
being in force or for any other reason, the Security Trustee shall
be entitled thereafter to enforce this Deed as if no such discharge,
release or settlement had occurred.
(c) For that Collateral which has been transferred and registered under
the name of the Security Trustee (as trustee for the Finance
Parties) or its Nominee, the Security Trustee shall only be obliged
to return the share certificate(s) then representing the Collateral
not yet disposed of or realised by the Security Trustee pursuant to
its powers under this Deed (but not the original share certificates
originally delivered to the Security Trustee by the Mortgagor) with
the instruments of transfer duly executed in favour of the Mortgagor
or such other person as the Mortgagor may direct.
3.5 CALLS
The Mortgagor shall during the continuance of this security pay all calls
or other payments which may become due in respect of any part of the
Collateral and the Security Trustee may, if it thinks fit, make such
payments on behalf of the Mortgagor. Any sums so paid by the Security
Trustee shall be repayable by the Mortgagor to the Security Trustee on
demand together with interest at the Default Rate from the date of
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such payment by the Security Trustee and pending such repayment shall
constitute part of the Secured Obligations.
3.6 REGISTRATION OF TITLE TO THE SHARES
The Mortgagor hereby agrees and authorises the Security Trustee to arrange
for the Shares and any other Collateral to be registered at any time
following the security constituted by this Deed becoming enforceable in
the name of the Security Trustee or its nominee and (under the powers of
enforcement contained herein) to transfer or cause the Collateral to be
transferred to and registered in the name of any purchasers or transferees
from the Security Trustee or its nominee and the Mortgagor undertakes from
time to time to execute and sign all transfers, powers of attorney and
other documents which the Security Trustee may require for perfecting its
title to or, otherwise registering and transferring any part of the
Collateral or for vesting the same in itself or its nominee or in any
purchasers or transferees.
4. CONTINUING AND INDEPENDENT SECURITY
4.1 CONTINUING SECURITY
This Deed shall remain in full force and effect by way of a continuing
security notwithstanding the insolvency or liquidation or any incapacity
or change in the constitution or status of the Mortgagor, the Borrower or
any other person and in particular but without limitation shall not be,
nor be considered as, satisfied by any intermediate discharge or payment
on account of any liabilities or any settlement of accounts between the
Mortgagor and the Security Trustee or any other person.
4.2 ADDITIONAL SECURITY
This Deed and the security hereby created shall be in addition to and not
in substitution for or derogation of any other Security Interest,
guarantee or other security (whether given by the Mortgagor or otherwise)
now or from time to time hereafter held by the Security Trustee or any
Finance Party in respect of or in connection with the Secured Obligations.
4.3 UNRESTRICTED ENFORCEMENT
The Security Trustee need not before exercising any of the rights, powers
or remedies conferred upon it by this Deed or by law (i) take action or
obtain judgment in any court against the Borrower or the Mortgagor or any
other person, (ii) make or file any claim or prove in a winding-up or
liquidation of the Borrower or the Mortgagor or of any other person or
(iii) enforce or seek to enforce the recovery of the monies and
liabilities hereby secured by any other security or other rights all of
which the Mortgagor hereby waives and may be enforced for any balance due
after resorting to any one or more other means of obtaining payment or
discharge of the monies, obligations and liabilities hereby secured.
4.4 NO DISCHARGE
The liabilities and obligations of the Mortgagor under this Deed and the
security
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constituted by this Deed shall remain in force notwithstanding any act,
omission, event or circumstance whatsoever until the expiry of the
Security Period and without limiting the foregoing, neither the
liabilities of the Mortgagor under this Deed nor the validity or
enforceability of this Deed shall be prejudiced, affected or discharged
by:-
(a) the granting of any time or indulgence to the Borrower or the
Mortgagor or any other Security Party or any other person in respect
of the Secured Obligations;
(b) any variation or modification of the Facility Agreement, any of the
other Finance Documents or any other documents referred to therein
or related thereto;
(c) the invalidity or unenforceability of any obligation or liability of
any party under the Facility Agreement, any of the other Finance
Documents or any other documents referred to therein or related
thereto;
(d) any invalidity or irregularity in the execution of the Facility
Agreement, any of the other Finance Documents or any other documents
referred to therein or relating thereto;
(e) any lack of capacity or deficiency in the powers of the Borrower or
the Mortgagor or any other Security Party or any other person to
enter into or perform any of its obligations under the Facility
Agreement or any of the other Finance Documents to which it is party
or any other documents referred to therein or related thereto or any
irregularity in the exercise thereof or any lack of authority by any
person purporting to act on behalf of the Borrower or the Mortgagor
or such Security Party or such other person;
(f) the insolvency, bankruptcy or liquidation or any incapacity,
disability, death or limitation or any change in the constitution or
status of the Borrower or the Mortgagor or any other Security Party
or any other person;
(g) any other Finance Document, Security Interest, guarantee or other
security or right or remedy being or becoming held by or available
to the Security Trustee and/or the Lenders or by any other person or
by any of the same being or becoming wholly or partly void, voidable
or unenforceable or impaired or by the Security Trustee and/or the
Lenders at any time releasing, refraining from enforcing, varying or
in any other way dealing with any of the same or any power, right or
remedy the Security Trustee and/or the Lenders may now or hereafter
have from or against the Borrower or the Mortgagor or any other
Security Party or any other person;
(h) any waiver, exercise, omission to exercise, compromise, renewal or
release of any rights against the Borrower or the Mortgagor or any
other Security Party or any other person or any compromise,
arrangement or settlement with any of the same;
(i) any act, omission, event or circumstance which would or may but for
this provision operate to prejudice, affect or discharge this Deed
or the liability of the Mortgagor hereunder.
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4.5 NO SUBROGATION
(a) The Mortgagor shall not exercise any right of subrogation,
contribution or any other rights of a surety or enforce any security
or other right or claim against the Borrower (whether in respect of
its liability under this Deed or otherwise) or any other person who
has guaranteed or given any security in respect of the Secured
Obligations or claim in the insolvency or liquidation of the
Borrower or any such other person in competition with the Security
Trustee or the Lenders.
(b) If the Mortgagor receives any payment or benefit in breach of this
Clause, it shall hold the same upon trust for the Security Trustee
as a continuing security for the Secured Obligations.
5. REPRESENTATIONS AND WARRANTIES
5.1 REPRESENTATIONS AND WARRANTIES
The Mortgagor represents and warrants to the Security Trustee and each of
the other Finance Parties that:-
(a) STATUS: the Mortgagor is a company duly incorporated, validly
existing and in good standing under the laws of Bermuda and has full
power, authority and legal right to own its property and assets and
to carry on its business as such business is now being conducted;
(b) POWER AND AUTHORITY: the Mortgagor has all legal power, authority
and capacity to enter into this Deed and perform its obligations
under this Deed and all actions (including any corporate actions)
required to authorise the execution and delivery of this Deed and
the performance of its obligations under this Deed have been duly
taken;
(c) LEGAL VALIDITY: this Deed constitutes or, when so executed and
delivered, will constitute legal, valid and binding obligations of
the Mortgagor enforceable in accordance with its terms;
(d) NON-CONFLICT WITH LAWS: the entry into and performance of this Deed
and the transactions contemplated by this Deed do not and will not
conflict with or result in (i) a breach of any law, judgment or
regulation or any official or judicial order, or (ii) a breach of
the constitutional documents of the Mortgagor, or (iii) a material
breach of any agreement or document to which the Mortgagor is a
party or which is binding upon it or any of its assets or revenues
with a monetary value greater than US$500,000, nor cause any
limitation placed on it or the powers of its directors to be
exceeded or result in the creation or imposition of any Security
Interest on any of its assets or revenues pursuant to the provisions
of any such agreement or document;
(e) NO CONSENT: other than the Consents, no consent of, giving of notice
to, or registration with, or taking of any other action in respect
of, any governmental authority or agency in any relevant
jurisdiction (including Bermuda) or of any creditors of the
Mortgagor is required for or in connection with the execution,
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performance, validity, enforceability and admissibility in evidence
in the proceedings of this Deed, or the carrying out by the
Mortgagor of its obligations under this Deed;
(f) NO REGISTRATION: it is not necessary in order to ensure the
legality, validity, enforceability or admissibility in evidence of
this Deed that it or any other instrument be notarised, filed,
recorded, registered or enrolled in any court or other authority or
that any stamp, registration or similar tax or charge be paid on or
in relation to this Deed and this Deed is in proper form for its
enforcement in the courts of Hong Kong, Bermuda and all
jurisdictions the subject of any legal opinion referred to in
paragraph 4 of Schedule 3 of the Facility Agreement;
(g) LITIGATION: except as disclosed in a letter of even date from the
Borrower to the Security Trustee, no litigation, arbitration or
administrative proceeding is currently taking place or pending or,
to the knowledge of the officers of the Mortgagor, threatened
against the Mortgagor or any of its assets which could in the
reasonable opinion of the Security Trustee materially and adversely
affect its business, assets or financial condition or its ability to
perform its obligations under this Deed;
(h) NO WINDING-UP: it has not taken any corporate action nor has any
other step has been taken or legal proceedings have been commenced
or threatened against it for its winding-up, dissolution,
administration or reorganisation or for the appointment of a
receiver, administrator, trustee or similar officer of it or all or
any of its assets or revenues, except as permitted by Clause 17.1(g)
of the Facility Agreement;
(i) TAXES ON PAYMENTS: all payments to be made by the Mortgagor under
this Deed may be made by the Mortgagor free and clear of, and
without deduction for, Taxes and no deductions or withholdings are
required to be made therefrom save as specified in any legal opinion
referred to in paragraphs 2, 3 and 4 of Schedule 3 to the Facility
Agreement; and no Taxes are imposed on by virtue of the execution or
delivery by the Mortgagor of this Deed or any document to be
executed or delivered under this Deed;
(j) TAX LIABILITIES: the Mortgagor has complied with all Taxation laws
in all material respects in all jurisdictions in which it is subject
to Taxation and has paid all Taxes due and payable by it and no
material claims are being asserted against it with respect to Taxes;
(k) NO DEFAULT:
(a) no Default has occurred and is continuing;
(b) it is not nor, with the giving of notice or lapse of time or
satisfaction of any other condition or any combination
therefore, would it be in material breach of or in default
under any agreement relating to Financial Indebtedness of
which it is a party or by which it may be bound;
(l) NO IMMUNITY: the Mortgagor is generally subject to civil and
commercial law
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and to legal proceedings and neither the Mortgagor nor any of its
assets or revenues is entitled to any immunity or privilege
(sovereign or otherwise) from any set-off, judgment, execution,
attachment or other legal process;
(m) COMPLIANCE, WITH CONSENTS AND LICENSES: every consent,
authorisation, licence or approval required for the time being by
the Mortgagor in connection with the conduct of its business and the
ownership, use, exploitation or occupation of its property and
assets has been applied for and not refused or has been obtained and
is in full force and effect and there has been no material default
in the observance of the conditions and restrictions (if any)
imposed on, or in connection with, any of the same which may have a
material adverse effect on its ability to perform its obligations
under this Deed and, to the knowledge of the officers of the
Mortgagor, no circumstances have arisen whereby any remedial action
is likely to be required to be taken by, or at the expense of the
Mortgagor under or pursuant to any law or regulation applicable to
the business, property or assets of the Mortgagor;
(n) NO FINANCIAL INDEBTEDNESS: it does not have any Financial
Indebtedness other than as permitted by Clause 16.17 of the Facility
Agreement;
(o) ISSUED AND PAID-UP SHARES: the Shares represent all of the shares in
the Borrower and all the Shares have been validly issued and are
fully paid up;
(p) SOLE AND BENEFICIAL OWNER: other than the Shares held by any
Nominee, the Mortgagor is the sole, absolute, legal and beneficial
owner of the Collateral and its has good and marketable title
thereto;
(q) SECURITY INTEREST: no Security Interest exists over all or any of
its right, title, interest or benefit in the Collateral (other than
as created by this Deed); and
(r) THIRD PARTY RIGHT: it has not sold or otherwise disposed of any of
the Collateral or granted in favour of any other person any interest
in or any option or other rights in respect of any of the
Collateral.
(s) COMPANY: the Company is validly incorporated and registered as an
exempted company in and under the laws of Bermuda and, if so
required by the Security Trustee, and at the expense of the
Mortgagor, the Mortgagor shall at any time apply to the Registrar of
Companies in Bermuda for the official form of Certificate of
Compliance relating to the continued corporate existence of the
Borrower and shall, if the same is issued, deliver the same to the
Security Trustee.
5.2 CONTINUING REPRESENTATION AND WARRANTY
The Mortgagor also represents and warrants to and undertakes with the
Security Trustee that the foregoing representations and warranties in
Clause 5.1(a) to (n) inclusive are deemed to be made by the Mortgagor on
each Drawdown Date and on each Interest Payment Date with reference to the
facts and circumstances then existing and that the foregoing
representations in Clause 5.1(o) and (s) will be true and accurate
throughout the continuance of this Deed with reference to the facts and
circumstances from time to time.
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6. TAXES AND OTHER DEDUCTIONS
6.1 TAX GROSS-UP
(a) All sums payable by the Mortgagor under this Deed shall be paid in
full without any restriction or condition and free and clear of any
Tax or other deductions or withholdings of any nature.
(b) If at any time the Mortgagor or any other person is required in any
jurisdiction to make any deduction or withholding in respect of
Taxes or otherwise from any payment due under this Deed for the
account of the Security Trustee or any other Finance Party (or if
the Security Trustee is required to make any such deduction or
withholding from a payment to any other Finance Party), the sum due
from the Mortgagor in respect of such payment shall be increased to
the extent necessary to ensure that, after the making of such
deduction or withholding, the Security Trustee and each other
Finance Party receives on the due date for such payment (and
retains, free from any liability in respect of such deduction or
withholding) a net sum equal to the sum which it would have received
had no such deduction or withholding been required to be made.
(c) The Mortgagor's obligations under Clause 6.1(a) and (b) shall not
apply in respect of any Tax on Overall Net Income levied on a
Finance Party.
(d) All Taxes required by law to be deducted or withheld by the
Mortgagor from any amounts paid or payable under this Deed shall be
paid by the Mortgagor when due (except for such amounts being
disputed by the Mortgagor in good faith) to the relevant taxing
authority.
6.2 TAX INDEMNITY
The Mortgagor shall indemnify the Security Trustee and each other Finance
Party against any losses or costs incurred by any of them by reason of:
(a) any failure of the Mortgagor or any other person to make any such
deduction or withholding referred to in Clause 6.1; or
(b) any increased payment referred to in Clause 6.1 not being made on
the due date for such payment; or
(c) any Taxes which are being disputed by the Mortgagor and remaining
unpaid; and
(d) any liability suffered (directly or indirectly) for or on account of
Tax by that Finance Party in respect of any payment received or
receivable or deemed to be received or receivable under this Deed.
6.3 EVIDENCE OF PROOF
The Mortgagor shall promptly deliver to the Security Trustee any receipts,
certificates
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or other proof evidencing the amounts (if any) paid or payable in respect
of any deduction or withholding as aforesaid.
6.4 TAX CREDIT
If the Mortgagor makes a Tax Payment and the Security Trustee determines
that:-
(a) a Tax Credit is attributable either to an increased payment of which
that Tax Payment forms part, or to that Tax Payment; and
(b) it has obtained, utilised and retained that Tax Credit,
the Security Trustee shall, promptly after obtaining the benefit of that
Tax Credit, pay an amount to the Mortgagor which will leave it (after that
payment) in the same after-Tax position as it would have been in had the
Tax Payment not been required to be made by the Mortgagor. Any certificate
or determination of the Security Trustee showing in reasonable details the
calculations made by the Security Trustee as to any amount for the
purposes of this Clause 6 shall, in the absence of manifest error, be
conclusive and binding on the Mortgagor.
7. COSTS, CHARGES AND EXPENSES
7.1 EXPENSES
The Mortgagor shall pay to the Security Trustee on demand and in the
currency specified by the Security Trustee:-
(a) irrespective as to whether any Advance is made, all expenses
(including legal, printing and out-of-pocket expenses) reasonably
incurred by the Security Trustee or any other Finance Party in
connection with the negotiation, preparation and execution of this
Deed and any amendment or extension of or the granting of any waiver
or consent under this Deed; and
(b) all expenses on a full indemnity basis (including legal and
out-of-pocket expenses) properly incurred by the Security Trustee or
any other Finance Party in connection with the enforcement of or
preservation of any rights under this Deed, or otherwise in respect
of the monies owing under this Deed together with interest at the
Default Rate from the date on which such expenses were incurred to
the date of payment (both before and after judgment).
7.2 STAMP DUTY
The Mortgagor shall pay all stamp, documentary, registration or other like
duties or taxes (including any duties or taxes payable by the Security
Trustee or any Finance Party) imposed on or in connection with this Deed
and shall indemnify each of the Security Trustee and the other Finance
Parties against any liability arising by reason of any delay or omission
by the Mortgagor to pay such duties or taxes.
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8. UNDERTAKINGS
The Mortgagor hereby undertakes and agrees with the Security Trustee, for
the benefit of the Finance Parties, throughout the continuance of this
Deed and so long as the Secured Obligations or any part thereof remains
owing that, unless the Security Trustee otherwise agrees in writing, it
will:-
(a) not create or attempt or agree to create or permit to exist any
Security Interest over all or any part of the Collateral or any
interest therein or otherwise sell, transfer, assign, deal with or
dispose of all or any part of the Collateral or attempt or agree to
do any of the same (except under or pursuant to this Deed);
(b) not grant or attempt or agree to grant in favour of any other person
any interest in or any option or other rights in respect of any of
the Collateral;
(c) ensure that no person holding any of the Collateral as its Nominee
for the time being does any of the acts prohibited in this Deed;
(d) subject to Clause 7.6(b) of the CNC HK Guarantee at all times remain
the sole, direct, absolute, legal and beneficial owner of the
Collateral;
(e) subject to Clause 7.6(b) of the CNC HK Guarantee procure that no
material amendment or supplement is made to the constitutional
documents of the Borrower other than pursuant to Clause 16.15 of the
Facility Agreement without the prior written consent of the Security
Trustee;
(f) immediately upon the appointment of any new director of the
Borrower, deposit or procure that there be deposited with the
Security Trustee, the equivalent documents mutatis mutandis with
respect to such director in the forms set out in Schedules 3, 4, 5
and 6;
(g) not take or permit any action whereby the rights attaching to the
Collateral and/or any other shares in the Borrower are altered;
(h) give to the Security Trustee upon receipt copies of all notices,
requests and other documents sent or received with respect to the
Collateral;
(i) give to the Security Trustee such information regarding the
Collateral as the Security Trustee shall reasonably require;
(j) do or permit to be done every act or thing which the Security
Trustee may from time to time require for the purpose of enforcing
the rights of the Security Trustee hereunder and will allow its name
to be used as and when required for that purpose;
(k) not do or cause or permit to be done anything which may in any way
depreciate, jeopardise or otherwise prejudice the value of the
security constituted hereunder;
(l) procure that the Borrower will forthwith on presentation by the
Security Trustee or its nominee following the security constituted
by this Deed becoming enforceable, duly register all transfers of
the Collateral; and
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(m) if the Mortgagor shall acquire any such other stocks or shares as
referred to in the definition of Collateral, it shall forthwith
deliver or procure that there be delivered to the Security Trustee
the certificates in respect thereof together with instruments of
transfer in respect thereof duly executed in blank to enable the
same to be registered in the name of the Security Trustee or its
nominee following the security constituted by this Deed becoming
enforceable.
9. ENFORCEMENT
9.1 EVENTS OF DEFAULT
The security created by this Deed shall become enforceable immediately
upon the occurrence of an Event of Default which is continuing. For the
purposes of this Clause, each of the following events and circumstances
shall be an Event of Default:-
(a) any Event of Default as that term is defined in the Facility
Agreement;
(b) if the Mortgagor purports or attempts to create any Security
Interest (except under or as permitted by this Deed) over all or any
part of the Collateral or any third party asserts a claim in respect
thereof, and
the Security Trustee shall be entitled, without prior or further notice
and whether or not it shall have appointed a Receiver, to exercise the
power to sell or otherwise dispose of the whole or any part of the
Collateral.
9.2 EXCLUSION OF LIMITATION
No restrictions imposed by any ordinance or other statutory provision in
relation to the exercise of any power of sale or consolidation shall apply
to this Deed.
9.3 APPOINTMENT AND POWERS OF RECEIVER
(a) At any time after the security hereby created has become
enforceable, or if requested by the Mortgagor, the Security Trustee
may in writing either under seal or under the hand of a duly
authorised officer of the Security Trustee, appoint any person or
persons to be a Receiver of the Collateral and may from time to time
fix its or their remunerations and may remove any Receiver so
appointed and appoint another in its place. Where more than one
Receiver is so appointed, any reference in this Deed to a Receiver
shall apply to both or all of the Receivers so appointed and the
appointment shall be deemed to be a joint and several appointment so
that the rights, powers, duties and discretions vested in the
Receiver may be exercised jointly by the Receivers so appointed or
severally by each of them.
(b) The Receiver shall be the agent of the Mortgagor and the Mortgagor
shall be solely responsible for the Receiver's acts or defaults and
for the Receiver's remuneration and the Receiver shall have all the
powers conferred from time to time on mortgagees or receivers by law
or otherwise (but without the restrictions imposed by law or any
ordinance or other statutory provision in relation to the
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exercise of any power of sale or consolidation) and power on behalf
and at the cost of the Mortgagor (notwithstanding any liquidation of
the Mortgagor) to do or omit to do anything which the Mortgagor
could do or omit to do in relation to the Collateral or any part
thereof.
(c) The Receiver shall in the exercise of the Receiver's powers,
authorities and discretions conform to the directions and
regulations from time to time given or made by the Security Trustee.
9.4 POWERS TO BE GIVEN WIDE CONSTRUCTION
The powers of the Security Trustee and the Receiver hereunder shall be
construed in the widest possible sense to the intent that the Security
Trustee and the Receiver shall be afforded as wide and flexible a range of
powers as possible.
9.5 NO LIABILITY TO ACCOUNT AS MORTGAGEE IN POSSESSION
Nothing that shall be done by or on behalf of the Security Trustee shall
render it liable to account as a mortgagee in possession for any sums
other than actual receipts.
9.6 AMENDMENT
Any amendment or waiver of any provision of this Deed and any waiver of
any default under this Deed shall only be effective if made in writing and
signed by the Security Trustee.
9.7 EVIDENCE OF DEBT
Any statement of account signed as correct by the Security Trustee showing
any amount due under the Facility Agreement or under this Deed or under
any other Finance Document shall, in the absence of manifest error, be
conclusive evidence of the amount so due.
9.8 SALE OF COLLATERAL
(a) Each of the Security Trustee and the Receiver shall be entitled to
exercise such power of sale in such manner and at such time or times
and for such consideration (whether payable immediately or by
instalments) as it shall in its absolute discretion think fit
(whether by private sale or otherwise) and so that the Collateral
(or any relevant part thereof) may be sold (i) subject to any
conditions which the Security Trustee or the Receiver may think fit
to impose, (ii) to any person (including, without limitation, any
person connected with the Mortgagor or the Security Trustee) and
(iii) at any price which the Security Trustee or the Receiver in its
absolute discretion considers to be the best obtainable in the
circumstances.
(b) If the Security Trustee exercises the rights conferred on it by this
Clause 9 any sale or disposal of any of the Collateral pursuant to
those rights shall not be treated as an absolute appropriation of or
foreclosure on the Collateral to the exclusion of the Mortgagor and
in extinguishment of its interest therein, unless the Security
Trustee shall otherwise notify the Mortgagor (whether before or
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after the relevant appropriation or foreclosure has been effected),
in which latter event any such appropriation or foreclosure shall be
treated as a sale of the Collateral at a fair market value and the
Secured Obligations shall be reduced by an equivalent amount.
(c) In any disposal pursuant to this Clause 9, the Security Trustee or
the Finance Parties may, provided that they shall first have used
reasonable efforts to dispose of the relevant Collateral or rights
to third parties subject to compliance with any rules or regulations
laid down by any governmental or other agency or authority,
themselves purchase the whole or any part of the Collateral or
rights disposed of free from any rights of redemption on the part of
the Mortgagor which are hereby waived and released.
9.9 DIVIDENDS
At any time after the power of sale has arisen, any dividends which have
been or may be received or receivable by the Security Trustee or the
Receiver may be applied by the Security Trustee or the Receiver as though
they were proceeds of sale hereunder.
9.10 PURCHASER NOT BOUND TO ENQUIRE
Each of the Security Trustee and the Receiver is authorised to give a good
discharge for any monies received by it pursuant to the exercise of its
power of sale and no purchaser or other person shall be bound to enquire
whether the power of sale has arisen as herein provided nor be concerned
with the manner of application of the proceeds of sale.
9.11 NO LIABILITY FOR LOSSES
The Mortgagor shall not have any claim against the Receiver or the
Security Trustee in respect of any loss arising out of the exercise by the
Security Trustee or the Receiver of their respective powers hereunder
including without limitation out of any such sale or any postponement
thereof howsoever caused and whether or not a better price could or might
have been obtained upon the sale of the Collateral or any part thereof by
deferring or advancing the date of such sale or otherwise howsoever.
9.12 WAIVER OF PRE-EMPTION RIGHTS
The Mortgagor hereby irrevocably and unconditionally waives any rights it
may have under the constitutional documents of the Borrower or otherwise
to purchase the Shares or Related Assets or other Collateral in the event
that they are or are proposed to be transferred, sold or otherwise
disposed of pursuant to the provisions of this Deed.
10. DIVIDENDS AND VOTING RIGHTS
10.1 After the security under this Deed has become enforceable and subject to
Clause 10.2, the Security Trustee shall have complete discretion to retain
the dividends, interest and other moneys received by the Security Trustee
in respect of the Collateral and to exercise or abstain from exercising
all voting and other rights and powers attaching to the Collateral as the
Security Trustee in its absolute discretion thinks fit without being
liable for any losses which the Mortgagor may suffer as a result thereof
(except in case
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[Mortgage of Shares]
of gross negligence or wilful default on the part of the Security Trustee)
and in this respect the Mortgagor will, or will procure its Nominee to act
or refrain from acting in accordance with the directions given by the
Security Trustee from time to time.
10.2 The Security Trustee agrees with the Mortgagor that until the security
under this Deed shall have become enforceable:
(a) the Mortgagor shall be entitled to receive and retain all dividends,
interest or other distributions or payments paid to and received by
the Mortgagor in respect of the Collateral; and
(b) the Mortgagor shall be entitled to exercise all voting and other
rights and powers attaching to the Collateral or any part thereof
for all purposes, including but not limited to, exercising any
option, warrant, conversion right or any other right, power or other
privilege attaching to the Collateral provided that the same does
not adversely affect or prejudice the rights of the Finance Parties
or the security hereby created.
11. APPLICATION OF PROCEEDS
All monies received by the Security Trustee or the Receiver hereunder
shall be applied in or towards satisfaction of the Secured Obligations
(subject to the prior discharge of all liabilities having priority thereto
by law) in the following order of priority:-
(a) in payment or satisfaction of all costs, charges, expenses and
liabilities properly incurred and payments made by or on behalf of
the Security Trustee or the Receiver in connection with the exercise
of any powers hereunder and in preserving or attempting to preserve
this security or the Collateral and of all outgoings in respect of
the Collateral paid by the Security Trustee or the Receiver pursuant
to this Deed;
(b) in payment to the Receiver of all remuneration as may be agreed
between it and the Security Trustee to be paid to it at, or at any
time after, its appointment;
(c) in or towards reduction of the remaining Secured Obligations in such
manner as is provided in the Facility Agreement; and
(d) surplus (if any) to the Mortgagor.
12. INDEMNITY
12.1 GENERAL INDEMNITY
The Mortgagor hereby undertakes with the Security Trustee to indemnify and
keep indemnified the Security Trustee and each other Finance Party, any
nominee, agent, officer or employer thereof for whose liability the
Security Trustee may be answerable, the Receiver and each of them (each an
"INDEMNITEE") from and against all losses, actions, claims, demands,
liabilities, costs, charges and expenses which such indemnitee shall
properly incur in connection with anything done or omitted to be done in
the
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exercise or purported exercise of any powers conferred by this Deed or
occasioned by any breach by the Mortgagor of any of its covenants or other
obligations to the Security Trustee hereunder or the perfection,
preservation or enforcement of the security created by this Deed (unless
and to the extent that any of the foregoing results directly from the
fraud, gross negligence or wilful misconduct of that indemnitee).
12.2 CURRENCY INDEMNITY
(a) If an amount due to the Security Trustee or any Receiver from the
Mortgagor under this Deed (a "SUM"), or any order, judgment or award
given or made in relation to a sum, has to be converted from the
currency (the "FIRST CURRENCY") in which that sum is payable into
another currency (the "SECOND CURRENCY") for the purpose of:
(i) making or filing a claim or proof against the Mortgagor;
(ii) obtaining or enforcing an order, judgment or award in relation
to any litigation or arbitration proceedings,
the Mortgagor shall, as an independent obligation to the Security
Trustee or such Receiver, indemnify the Security Trustee or such
Receiver to whom that sum is due against any cost, loss or liability
arising out of or as a result of the conversion including any
discrepancy between (A) the rate of exchange used to convert that
sum from the first currency into the second currency and (B) the
rate or rates of exchange available to that person at the time of
its receipt of that sum.
(b) The Mortgagor waives any right it may have in any jurisdiction to
pay any amount under this Deed in a currency or currency unit other
than that in which it is expressed to be payable.
12.3 PAYMENT AND SECURITY
The Security Trustee or any Finance Party may retain and pay out of any
money in the hands of the Security Trustee or such Finance Party all sums
necessary to effect the indemnity contained in this Clause and all sums
payable by the Mortgagor under this Clause shall form part of the monies
hereby secured.
13. SUSPENSE ACCOUNT
The Security Trustee may, notwithstanding Clause 11 (Application of
Proceeds) place and keep any monies received under this Deed, before or
after the insolvency of the Mortgagor, to the credit of a suspense account
in order to preserve the rights of the Security Trustee or the Receiver or
the Lenders to xxx or prove for the whole amount in respect of claims
against the Mortgagor or any other person.
14. SET-OFF
(a) Without prejudice to any right of set-off, combination of accounts,
lien or other
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rights which the Security Trustee or the Receiver is at any time
entitled whether by operation of law or contract or otherwise, the
Security Trustee and the Receiver may (but shall not be obliged to)
set off against any obligation of the Mortgagor due and payable by
it hereunder without prior notice any moneys held by the Security
Trustee or such Receiver for the account of the Mortgagorat any
office of the Security Trustee or such Receiver anywhere and in any
currency. The Security Trustee or such Receiver may effect such
currency exchanges as are appropriate to implement such set-off.
(b) If the obligations are in different currencies, the Security Trustee
or such Receiver may convert either obligation at a market rate of
exchange in its usual course of business for the purpose of the
set-off.
15. POWER OF ATTORNEY
15.1 POWER OF ATTORNEY
The Mortgagor irrevocably appoints the Security Trustee, the Receiver and
any persons deriving title under either of them by way of security jointly
and severally to be its attorney (with full power of substitution) and in
its name or otherwise on its behalf and as its act and deed to sign, seal,
execute, deliver, perfect and do all deeds, instruments, acts and things
which may be required or which the Security Trustee or the Receiver shall
think proper or reasonably expedient for carrying out any obligations
imposed on the Mortgagor hereunder or for exercising, following the
security constituted by this Deed becoming enforceable, any of the powers
conferred by this Deed or in connection with any sale or disposition of
the Collateral or the exercise of any rights in respect thereof or for
giving to the Security Trustee and the Receiver the full benefit of this
security and so that this appointment shall operate to authorise the
Security Trustee and the Receiver to do on behalf of the Mortgagor
anything it can lawfully do by an attorney. The Mortgagor ratifies and
confirms and agrees to ratify and confirm any deed, instrument, act or
thing which such attorney or substitute may execute or do in exercising
its powers under this Clause.
15.2 DELEGATION
The Security Trustee and/or the Receiver may delegate to any person all or
any of the rights or powers conferred on it by this Deed or by law. Any
such delegation may be made upon such terms and conditions (including
power to sub-delegate) as the Security Trustee or the Receiver thinks fit.
16. FURTHER ASSURANCE
The Mortgagor agrees that at any time and from time to time upon the
written request of the Security Trustee it will promptly and duly execute
and deliver any and all such further instruments and documents as the
Security Trustee may reasonably require for the purpose of obtaining the
full benefit of this Deed and of the rights and powers herein granted.
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[Mortgage of Shares]
17. NOTICES
17.1 NOTICES
Any notice or communication under or in connection with this Deed shall be
in writing and shall be delivered personally or by prepaid letter (airmail
if available) or facsimile transmission to the addresses or facsimile
numbers set out below or at such other address as the recipient may have
notified to the other parties in writing. Proof of posting or despatch of
any notice or communication to any party hereto shall be deemed to be
proof of receipt:-
(a) in the case of a letter, on the fifth Business Day after posting if
airmail or second Business Day if local mail;
(b) in the case of a facsimile transmission, on the Business Day
immediately following the date of despatch with confirmed facsimile
report.
All communications or other correspondence between the Mortgagor and any
of the Lenders in connection with this Deed shall be made through the
Security Trustee.
17.2 ADDRESSES
Notices or communications shall be sent to the following addresses:-
To the Mortgagor:-
Address c/o Asia Netcom Corporation Limited
00/X Xxxxxx Xxxx Xxxxxx
0 Xxxxx'x Xxxx Xxxxxxx
Xxxx Xxxx
Fax (000) 0000 0000
Attention Xxxxxxx Xxxxxxxx/Wenlong Sun
To the Security Trustee:-
Address Industrial and Commercial Bank of China (Asia) Limited
10/F., ICBC Asia Xxxxxxxx
000-000 Xxxxx'x Xxxx Xxxxxxx
Xxxx Xxxx
Fax (000) 0000 0000
Attention Xx. Xxxxxx Xxxxx/Ms. Xxx Xxxx
17.3 Each notice or document referred to in this Deed or to be delivered under
this Deed shall be in the English language.
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18. WAIVERS, AMENDMENTS AND CONSENTS, REMEDIES, SEVERABILITY, ASSIGNMENT AND
COUNTERPARTS
18.1 WAIVERS
No failure or delay on the part of the Security Trustee or any Lender to
exercise any power, right or remedy under this Deed shall operate as a
waiver thereof, nor shall any single or partial exercise by the Security
Trustee or any Lender of any power, right or remedy preclude any other or
further exercise thereof or the exercise of any other power, right or
remedy.
18.2 AMENDMENTS AND CONSENTS
(a) Any amendment of any provision of this Deed shall only be effective
if made in accordance with the provisions of this Deed and the
Mortgagor and the Security Trustee so agree in writing and any
waiver of any breach or default under this Deed shall only be
effective if the Security Trustee acting on the instructions of the
Lenders or the Majority Lenders, as the case may be, agrees in
writing. Any consent by the Security Trustee under this Deed must be
made in writing.
(b) Any such waiver or consent may be given subject to any conditions
thought fit by the Security Trustee acting or the instructions of
the Lenders or the Majority Lenders, as the case may be, and shall
be effective only in the instance and for the purpose for which it
is given.
18.3 REMEDIES
The remedies provided in this Deed are cumulative and are not exclusive of
any remedies provided by law.
18.4 SEVERABILITY
If any provision of this Deed is prohibited or unenforceable in any
jurisdiction such prohibition or unenforceability shall not invalidate the
remaining provisions hereof or affect the validity or enforceability of
such provision in any other jurisdiction.
18.5 ASSIGNMENT
The Security Trustee may assign its rights under this Deed in accordance
with the provisions of the Facility Agreement. The Mortgagor may not
assign any of its rights hereunder without the prior written consent of
the Security Trustee.
18.6 COUNTERPARTS
This Deed may be executed in any number of counterparts including by
facsimile and all of which taken together shall constitute one and the
same instrument, and any party hereto may execute this Deed by signing any
such counterpart.
18.7 It is intended that this document takes effect as a deed notwithstanding
the fact that a party may only execute this document under hand.
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19. GOVERNING LAW AND JURISDICTION
19.1 GOVERNING LAW
This Deed shall be governed by and construed in accordance with the laws
of Bermuda.
19.2 SUBMISSION TO JURISDICTION
For the benefit of the Security Trustee and the other Finance Parties, the
Mortgagor irrevocably agrees that the courts of the Bermuda and Hong Kong
are to have non-exclusive jurisdiction to settle any disputes which may
arise out of or in connection with this Deed and that, accordingly, any
legal action or proceedings arising out of or in connection with this Deed
("PROCEEDINGS") may be brought in those courts and the Mortgagor
irrevocably submits to the jurisdiction of those courts.
19.3 OTHER JURISDICTIONS
Nothing in this Clause shall limit the right of the Security Trustee to
take proceedings against the Mortgagor in any other court of competent
jurisdiction nor shall the taking of Proceedings in one or more
jurisdictions preclude the Security Trustee from taking Proceedings in any
other jurisdiction, whether concurrently or not.
19.4 WAIVER OF INCONVENIENT FORUM
The Mortgagor irrevocably waives any objection which it may at any time
have to the laying of the venue of any Proceedings in any court referred
to in this Clause 19 (Governing Law and Jurisdiction) and any claim that
any such Proceedings have been brought in an inconvenient forum.
19.5 PROCESS AGENT
The Mortgagor hereby irrevocably appoints Asia Netcom Asia Pacific
Commercial Limited of 00xx Xxxxx, Xxxxxx Xxxx Xxxxxx, 0 Xxxxx'x Xxxx,
Xxxxxxx, Xxxx Xxxx to receive, for it and on its behalf, service of
process in any Proceedings in Hong Kong. Such service shall be deemed
completed on delivery to the process agent whether or not it is forwarded
to and received by the Mortgagor. If for any reason the process agent
ceases to be able to act as such or no longer has an address in Hong Kong,
the Mortgagor irrevocably agrees to appoint a substitute process agent
acceptable to the Security Trustee, and to deliver to the Security Trustee
a copy of the new process agent's acceptance of that appointment, within
30 days.
19.6 SERVICE
The Mortgagor irrevocably consents to any process in any Proceedings
anywhere being served by mailing a copy by post in accordance with the
Clause 17 (Notices) provision of this Deed. Nothing shall affect the right
to serve any process in any other manner permitted by law.
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19.7 Waiver of Immunities
To the extent that the Mortgagor has or hereafter may acquire any immunity
(sovereign or otherwise) from any legal action, suit or proceeding, from
jurisdiction of any court or from set-off or any legal process (whether
service or notice, attachment prior to judgment, attachment in aid of
execution of judgment, execution of judgment or otherwise) with respect to
itself or any of its property, the Mortgagor hereby irrevocably waives and
agrees not to plead or claim such immunity in respect of its obligations
under this Deed.
IN WITNESS whereof this Deed has been executed by the parties hereto and is
intended to be and is hereby delivered by the Mortgagor as a deed on the day and
year first above written.
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SCHEDULE 1
PARTICULARS OF THE SHARES
REGISTERED
SHAREHOLDERS AND
DESCRIPTION AND NUMBER OF SHARES
NAME OF COMPANY NUMBER OF SHARES HELD
Asia Netcom Corporation 120,000,000 shares of US$0.01 China Netcom Corporation
Limited each International Limited
(120,000,000 shares)
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SCHEDULE 2
FORM OF INSTRUMENT OF TRANSFER
INSTRUMENT OF TRANSFER
ASIA NETCOM CORPORATION LIMITED
We, China Netcom Corporation International Limited of [ ] in consideration of
the Sum of ____________ hereby paid to me by ________________ of
______________________ (the "TRANSFEREE"), do hereby transfer to the said
Transferee the _______ Shares standing in our name in the Register of Members of
Asia Netcom Corporation Limited to hold unto the said Transferee, its executors,
administrators or assigns, subject to the several conditions upon which we hold
the same at the time of execution hereof. And we the said Transferee do hereby
agree to take the said Shares subject to the same conditions.
Witness our hands the day of , .
Witness to the signature(s) of
Name
----------------------------------------
Address
----------------------------------------
---------------------------------------- ------------------------------------
CHINA NETCOM CORPORATION
INTERNATIONAL LIMITED
----------------------------------------
Witness to the signature(s) of
Name
----------------------------------------
Address
----------------------------------------
---------------------------------------- ------------------------------------
[THE TRANSFEREE]
---------------------------------------- ------------------------------------
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SCHEDULE 3
FORM OF LETTER OF RESIGNATION
To: The Board of Directors
of Asia Netcom Corporation Limited (the "COMPANY")
Date: __________________
I, [Name of director/secretary], hereby resign my position as a
director/secretary of the Company with effect from and waive all claims to fees
or compensation in connection with or arising from my employment and/or
resignation save as provided by law in Bermuda.
SIGNED, SEALED AND DELIVERED by
[Name of director/secretary]
in the presence of:
Signature of witness:____________________________
Name of witness: ____________________________
Address of witness: ____________________________
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SCHEDULE 4
FORM OF WRITTEN RESOLUTION
ASIA NETCOM CORPORATION LIMITED
Written Resolutions of all the Directors of the Company dated the day of
We, the undersigned, being all the Directors of the Company, hereby resolve:-
1. Appointment of Directors/Secretary
That the following persons be appointed as Directors and/or Secretary of
the Company with immediate effect:-
2. Resignation of Directors
That the Letters of Resignation signed by [names of all
Directors/Secretary] be accepted and that the same shall take effect
forthwith.
[signed by all Directors]
---------------------------- -----------------------------
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[Mortgage of Shares]
SCHEDULE 5
FORM OF AUTHORISATION FROM DIRECTORS/SECRETARY
[Date]
To: Industrial and Commercial Bank of China (Asia) Limited
10/F., ICBC Asia Xxxxxxxx
000-000 Xxxxx'x Xxxx Xxxxxxx
Xxxx Xxxx
We are, at the date hereof, all the directors and the sole secretary of Asia
Netcom Corporation Limited (the "COMPANY").
We refer to (a) the Facility Agreement dated [-], 2004, as amended and restated
by the Supplemental Amendment and Restatement Deed dated [-], 2004 (the
"FACILITY AGREEMENT") entered into between (1) the Company, as borrower (2) the
banks and financial institutions named therein as lender (the "LENDERS") and (3)
Industrial and Commercial Bank of China (Asia) Limited as arranger and facility
agent (b) the Deed of Mortgage of Shares dated [-], 2004 (the "MORTGAGE") made
between China Netcom Corporation International Limited as mortgagor and
yourselves as Security Trustee in relation the Shares in the Company; and (c) an
undated written resolution of all the directors and secretary of the Company
signed by us resolving to approve the appointment of new director(s) and/or new
secretary of the Company and the resignation of us as directors and/or secretary
of the Company (the "WRITTEN RESOLUTIONS").
We hereby irrevocably authorise you, at any time after the Mortgage has become
enforceable without our consent, to nominate such person(s) as you may in your
absolute discretion determine to be the director(s) and secretary of the Company
and to complete the written resolutions in such manner as you may think fit,
including to insert the date (which can be any date after the date hereof) and
the name(s) of the additional director(s) and/or the secretary. We confirm and
declare that the written resolutions as completed by you shall in all respects
be valid and effective as a board resolutions of the Company on the date and to
the effect as stated therein, and be binding on us and on the Company.
We also refer to the undated letters of resignation as directors and/or the
secretary of the Company signed by us. Each of us hereby irrevocably authorises
you at any time after the Mortgage has become enforceable without our consent to
insert a date (which can be any date after the date hereof) on the letters of
resignation, upon which our resignation of directorship and/or as secretary
shall take immediate effect.
[signed by all Directors and Secretary]
-------------------------------- -------------------------------
-------------------------------- -------------------------------
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[Mortgage of Shares]
SCHEDULE 6
FORM OF LETTER OF UNDERTAKING
[Date]
To: Industrial and Commercial Bank of China (Asia) Limited
10/F., ICBC Asia Xxxxxxxx
000-000 Xxxxx'x Xxxx Xxxxxxx
Xxxx Xxxx
We, the undersigned Directors of Asia Netcom Corporation Limited (the
"COMPANY"), refer to the Deed of Mortgage of Shares dated [ ], 2004 and made
between China Netcom Corporation International Limited as mortgagor and
yourselves as Security Trustee, and in pursuance thereof hereby undertake not to
appoint any additional or substitute Directors or Secretary of the Company
without your written consent.
[signed by all Directors]
-------------------------------- -------------------------------
-------------------------------- -------------------------------
-29-
[Mortgage of Shares]
SCHEDULE 7
FORM OF ACKNOWLEDGEMENT OF NOMINEE
To: Industrial and Commercial Bank of China (Asia) Limited
_________________, 2004
Dear Sirs,
RE: ASIA NETCOM CORPORATION LIMITED (THE "COMPANY")
I/We acknowledge that by a deed of mortgage of shares dated [___________], 2004
(the "SHARE MORTGAGE"), China Netcom Corporation International Limited (the
"MORTGAGOR") has agreed to mortgage the entire issued share capital of the
Company (the "SHARES") of which the Mortgagor is the sole beneficial owner to
you.
I/We hereby agree to deposit with you the certificates in respect of the
Share(s) of which I/we are the registered holder and to execute and deliver to
you such instruments of transfer, contract note, and other documents in respect
of such Share(s), including a power of attorney to sell, transfer or otherwise
dispose of the same, in such form as you may at any time and from time to time
require.
I/We [jointly and severally], until such time as I/we receive written notice
from you stating that the Share Mortgage has been released or otherwise
discharged:
1. warrant that I/we are the registered holder(s) of a total of [____]
[ordinary share(s)] of $[_______] each, in the Company;
2. confirm that I/we hold such share(s) as nominee(s) on trust for you and
that I/we shall hereafter hold such share(s) on you behalf as mortgagee in
accordance with the terms of the Share Mortgage; and
3. grant to you a power of attorney in the terms of clause 15 of the Share
Mortgage as if references therein to the Mortgagor were references to
me/us and undertake to grant you such further powers of attorney in such
form as you may at any time and from time to time require.
EITHER:
SIGNED, SEALED AND DELIVERED )
by [___________________________] )
in the presence of: )
OR:
THE COMMON SEAL of )
[___________________________] )
was hereunto affixed in )
the presence of: )
-30-
[Mortgage of Shares]
EXECUTION PAGE
THE MORTGAGOR
SIGNED, SEALED AND DELIVERED )
as a Deed by its duly authorised attorney )
)
for and on behalf of )
CHINA NETCOM CORPORATION )
INTERNATIONAL LIMITED )
in the presence of:- )
THE SECURITY TRUSTEE
SIGNED BY )
for and on behalf of )
INDUSTRIAL AND COMMERCIAL BANK )
OF CHINA (ASIA) LIMITED )
in the presence of: )
-31-
