EXHIBIT 10.14
RUPEE TERM FACILITY AGREEMENT
Rs. 700,00,00,000
Dated this 18th day of August, 2004
For
BHARAT ALUMINIUM COMPANY LIMITED
Arranged by
ABN AMRO SECURITIES (INDIA) PRIVATE LIMITED
MANDATED ARRANGER
AND
UNION BANK OF INDIA AND EXPORT IMPORT BANK OF INDIA
JOINT LEAD MANAGERS
IL&FS TRUST COMPANY LIMITED
As the Agent and Security Trustee
AND
THE BANKS AND FINANCIAL INSTITUTIONS
(AS SET OUT IN THE SCHEDULE 1)
As Original Lenders
XXXX & XXXXXX & CO.
CONTENTS
CLAUSE PAGE
------ ----
CLAUSE 1................................................................. 1
INTERPRETATION........................................................... 1
CLAUSE 2................................................................. 12
THE FACILITIES AND DRAWDOWN CONDITIONS................................... 12
CLAUSE 3................................................................. 14
DRAWDOWN................................................................. 14
CLAUSE 4................................................................. 15
REPAYMENT, PREPAYMENT AND CANCELLATION................................... 15
CLAUSE 5................................................................. 16
INTEREST, INTEREST PERIODS............................................... 16
CLAUSE 6................................................................. 19
ADDITIONAL PAYMENT OBLIGATIONS........................................... 19
CLAUSE 7................................................................. 22
SECURITY INTEREST AND SECURITY DOCUMENTS................................. 22
CLAUSE 8................................................................. 23
REPRESENTATIONS, UNDERTAKINGS AND EVENTS OF DEFAULT...................... 23
CLAUSE 9................................................................. 36
EVENTS OF DEFAULT........................................................ 36
CLAUSE 10................................................................ 40
CHANGES TO PARTIES....................................................... 40
CLAUSE 11................................................................ 44
THE FINANCE PARTIES...................................................... 44
CLAUSE 12................................................................ 55
ADMINISTRATION........................................................... 55
SCHEDULE - 1 THE ORIGINAL PARTIES COMMITMENTS AND REPAYMENT INSTALMENTS.. 63
SCHEDULE - 2 CONDITIONS PRECEDENT TO DRAWDOWN............................ 64
SCHEDULE - 3 REQUESTS.................................................... 66
SCHEDULE - 4 FORM OF TRANSFER CERTIFICATE................................ 67
SCHEDULE - 5 FORM OF COMPLIANCE CERTIFICATE.............................. 69
SCHEDULE - 6 BRIEF DESCRIPTION OF ASSETS................................. 70
SCHEDULE - 7 DESCRIPTION OF SECURED INDEBTEDNESS......................... 73
THIS RUPEE TERM FACILITIES AGREEMENT is dated this 18th day of August, 2004 and
made in Mumbai between:
(1) BHARAT ALUMINIUM COMPANY LIMITED, a public company within the meaning of
the Companies Act, 1956 and having its registered office at Aluminium
Sadan, Core-6, Scope office Complex, 0, Xxxxx xxxx, Xxx Xxxxx-000000
(hereinafter referred to as the "BORROWER", "BALCO", or the "COMPANY");
(2) ABN AMRO SECURITIES (INDIA) PRIVATE LIMITED (the "MANDATED ARRANGER");
(3) UNION BANK OF INDIA AND EXPORT IMPORT BANK OF INDIA (the "JOINT LEAD
MANAGERS");
(4) THE BANKS AND FINANCIAL INSTITUTIONS listed in Part II of Schedule 1 as
lenders (the "ORIGINAL LENDERS"); and
(5) IL&FS TRUST COMPANY LIMITED, as agent and security trustee of the Finance
Parties (other than itself) (the "AGENT AND SECURITY TRUSTEE").
WHEREAS the Lenders have at the request of the Borrower agreed to make available
to the Borrower, a rupee facility on, and subject to the terms and conditions of
this Agreement.
IT IS AGREED as follows:
CLAUSE - 1
INTERPRETATION
1. DEFINITIONS AND INTERPRETATION
1.1 DEFINITIONS
In this Agreement:
"AFFILIATE" means with respect to Sterlite or the Borrower as the case may be,
any person which is a holding company or subsidiary of Sterlite or the Borrower
or any
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person which, directly or indirectly, (a) controls Sterlite or the Borrower, (b)
is controlled by Sterlite or the Borrower or (c) is controlled by the same
person who, directly or indirectly, controls Sterlite or the Borrower. For the
purposes of this Agreement, the terms "holding company" and "subsidiary" shall
have the meaning ascribed to them under Section 4 of the Companies Act, 1956 and
the term "control" shall mean:
a. control over the composition of board of directors of Sterlite, the
Borrower or any Affiliate of either of them;
b. Control of at least 51% of the issued equity share capital of a company,
which is an Affiliate of either of the Borrower or Sterlite.
"AGREEMENT" OR THE "FACILITIES AGREEMENT" means this rupee term facilities
agreement.
"ASSETS" means Immovable Properties and Other Properties of the Borrower.
"AUTHORISATION" means:
(a) An authorisation, consent, approval, resolution, licence, exemption,
filing, notarisation, lodgement or registration; or
(b) In relation to anything which will be fully or partly prohibited or
restricted by law if a Government Agency intervenes or acts in any way
within a specified period after lodgement, filing, registration or
notification, the expiry of that period without intervention or action.
"COMMITMENT A" means:
(a) In relation to an Original Lender, the amount set opposite its name under
the heading "Commitment A" in Part IIA of Schedule 1 (The Original Parties
Commitments and Repayment Instalments) and the amount of any other
Commitment transferred to it under this Agreement; and
(b) In relation to any other Lender, the amount of any Commitment A transferred
to it under this Agreement,
to the extent not cancelled, reduced or transferred by it under this Agreement.
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"COMMITMENT B" means:
(a) In relation to an Original Lender, the amount set opposite its name under
the heading "Commitment B" in Part IIB of Schedule 1 (The Original Parties
Commitments and Repayment Instalments) and the amount of any other
Commitment transferred to it under this Agreement; and
(b) In relation to any other Lender, the amount of any Commitment B transferred
to it under this Agreement,
to the extent not cancelled, reduced or transferred by it under this Agreement.
"CURRENT ASSETS" means raw materials, semi-finished goods, finished goods
including aluminium ore extracted from mines or purchased, packing materials,
consumable stores, book debts and other assets described as current assets in
financial statements of the Borrower in the form given in Schedule VI Part 1 of
the Companies Act, 1956.
"COMPLIANCE CERTIFICATE" means a certificate delivered pursuant to Clause 8.2.2
(Compliance Certificates) and signed by any director of the Borrower in form and
substance given in Schedule 5.
"DEFAULT" means an Event of Default or any event or circumstance specified in
Clause 9 (Events of Default) which would (with the expiry of a grace period, the
giving of notice, the making of any determination under the Finance Documents or
any combination of any of the foregoing) be an Event of Default.
"DRAWDOWN" means a drawdown of a Facility.
"DRAWDOWN DATE" means the date of a Drawdown.
"DRAWDOWN REQUEST" means a notice substantially in the form set out in Schedule
3 (Request).
"EVENT OF DEFAULT" means any event or circumstance specified as such in Clause 9
(Events of Default).
"EXISTING HYPOTHECATION" means a charge by way of security created on the Other
Properties for securing repayment and payment of Existing Secured Indebtedness
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"EXISTING SECURED CREDITORS" means the creditors whose Indebtedness is secured
by the charge on the Assets and the details whereof are given in Schedule 7
hereto.
"EXISTING SECURITY DOCUMENT" means an instrument, whether recording
electronically or manually, creating or evidencing the creation of any security
interest securing any Existing Secured Indebtedness
"EXISTING SECURITY INTEREST" means a Security Interest created in favour
Existing Secured Creditors particulars whereof are given in Schedule 7.
"EXISTING SECURED INDEBTEDNESS" means the existing Indebtedness, repayment and
payment of which is secured by hypothecation and/or mortgage on a pari passu
basis on the properties, details whereof are given in Schedule 7 hereto.
"FACILITY" means Facility A or Facility B, as the context may require;
"FACILITY A" means a rupee term loan facility upto an aggregate amount of Rs.
225 crores to be made available under this Agreement as described in Clause
2.1.1 ("Facility A").
"FACILITY B" means a rupee term loan facility upto an aggregate amount of Rs.
475 crores to be made available under this Agreement as described in Clause
2.1.2 ("Facility B")
"FACILITY OFFICE" means the office or offices notified by a Lender to the Agent
and Security Trustee in writing on or before the date it becomes a Lender (or,
following that date, by not less than five Business Days' written notice) as the
office or offices through which it will perform its obligations under this
Agreement.
"FEE LETTER" means any letter or letters dated on or about the date of this
Agreement between the Arranger and the Borrower (or the Agent and Security
Trustee and the Borrower) setting out any of the fees.
"FINANCE DOCUMENT" means this Agreement, a Security Document, any Fee Letter,
Transfer Certificate, any resignation letter and any other document designated
as such by the Agent and Security Trustee, a Lender and the Borrower.
"FINANCE PARTY" means the Agent and Security Trustee, the Arranger or a Lender,
as the context may require.
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"FINANCIAL INDEBTEDNESS" means any indebtedness of the Borrower for or in
respect of:
(a) Moneys borrowed;
(b) Any amount raised by acceptance under any acceptance credit facility;
(c) Any amount raised pursuant to any note purchase facility or the issue of
bonds, notes, debentures, loan stock or any similar instrument;
(d) The amount of any liability in respect of any lease or hire purchase
contract which would, in accordance with GAAP, be treated as a finance or
capital lease;
(e) Receivables sold or discounted (other than any receivables to the extent
they are sold on a non-recourse basis);
(f) Any amount raised under any other transaction (including any forward sale
or purchase agreement) having the commercial effect of a borrowing;
(g) Any derivative transaction entered into in connection with protection
against or benefit from fluctuation in any rate or price (and when
calculating the value of any derivative transaction, only marked to market
value shall be taken into account);
(h) Any counter-indemnity obligation in respect of a guarantee, indemnity,
bond, standby or documentary letter of credit or any other instrument
issued by a bank or financial institution; and
(i) The amount of any liability in respect of any guarantee or indemnity for
any of the items referred to in paragraphs (a) to (h) above.
"FUTURE INDEBTEDNESS" means any Financial Indebtedness which may be incurred by
the Borrower from any other creditor.
"GAAP" means generally accepted accounting principles in India.
"GOVERNMENTAL AGENCY" means any government or any governmental agency,
semi-governmental or judicial entity or authority (including, without
limitation, any stock exchange or any self-regulatory organisation established
under statute).
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"HOLDING COMPANY" means, in relation to a company or corporation, any other
company or corporation in respect of which that company or corporation is a
Subsidiary.
"IMMOVABLE PROPERTIES" means the immovable properties briefly described in Part
I Schedule 6.
"INDIRECT TAX" means any goods and services tax, consumption tax, value added
tax, excise, sales tax or any tax of a similar nature.
"INDEBTEDNESS" means the Financial Indebtedness, the Loan Amounts outstanding at
the time of computation, or the Future Indebtedness as the context may require.
"INTEREST PAYMENT DATE" means the last day of an Interest Period.
"INTEREST PERIOD" means, each period determined in accordance with Clause 5.2
(Interest Periods) and, in relation to an Unpaid Sum, each period determined in
accordance with Clause 5.1.3(Default interest).
"LENDER" means:
(a) Any Original Lender; or
(b) Any bank, financial institution, trust, fund or other entity which has
become a Party in accordance with Clause 10 (Changes to Parties)
which in each case has not ceased to be a Party in accordance with the terms of
this Agreement.
"LOAN" means Loan A, or Loan B as the context may require.
"LOAN A" means the outstanding amount for the time being of Facility A
disbursed.
"LOAN B" means the outstanding amount for the time being of Facility B
disbursed.
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"LOAN AMOUNT" means a Repayment Instalment of a Loan, interest, costs, charges,
expenses and any other amount by the Borrower including fees and/or remuneration
payable to a finance party.
"MAJORITY LENDERS" means:
(a) If no Loan is then outstanding, a Lender or Lenders whose Commitments
aggregate more than 66 2/3% of the Total Commitments (or, if the Total
Commitments have been reduced to zero, aggregated more than 66 2/3% of the
Total Commitments immediately prior to the reduction); or
(b) At any other time, a Lender or Lenders whose participation in the aggregate
amount of the Loans then outstanding is more than 66 2/3% of all the Loans
then outstanding.
"MATERIAL ADVERSE EFFECT" means a material adverse effect on (a) the business,
operations, property, condition (financial or otherwise) of the Borrower or any
of the Borrower's Subsidiaries, Sterlite; (b) the ability of the Borrower to
perform its obligations under the Finance Documents; or (c) the validity or
enforceability of this Agreement or the rights or remedies of any Finance Party
under the Finance Documents.
"MONTH" means a period starting on one day in a calendar month and ending on the
numerically corresponding day in the next calendar month, except that:
(a) (Subject to paragraph (c) below)] if the numerically corresponding day is
not a Business Day, that period shall end on the next Business Day in that
calendar month in which that period is to end if there is one, or if there
is not, on the immediately preceding Business Day;
(b) if there is no numerically corresponding day in the calendar month in which
that period is to end, that period shall end on the last Business Day in
that calendar month; and
(c) if an Interest Period begins on the last Business Day of a calendar month,
that Interest Period shall end on the last Business Day in the calendar
month in which that Interest Period is to end.
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The above rules will only apply to the last Month of any period.
"ORIGINAL FINANCIAL STATEMENTS" means:
(a) the audited consolidated financial statements of the Sterlite and its
subsidiaries for the financial year ended 31st March, 2004; and
(b) the Borrower's audited financial statements for its financial year ended
31st March, 2004.
"OTHER PROPERTIES" means the movable properties and assets of the Borrower other
than Current Assets, general particulars whereof are given in Part II of
Schedule 6.
"OTHER SECURED CREDITORS" means Secured Creditors other then the Lenders.
"PARTY" means a party to this Agreement.
"PROJECT" means the project of expansion and modernisation of the existing
facilities undertaken by the Borrower at Korba in the State of Chhattisgarh.
"PROMOTER" means the promoter of a company as defined Regulation 2(1)(h) of the
Take over Code.
"PROPERTIES" means Immovable Properties and Other Properties referred to
collectively.
"REPAYMENT DATE" means the last day of each quarter in the period commencing
from the 51st month from the date of the first Drawdown of a Facility and ending
on the 72nd month from the date of the first Drawdown. .
"REPAYMENT INSTALMENT" means each instalment for repayment of Loan specified in
clause 4.1.1 (Repayment of the Loans).
"REPEATING REPRESENTATIONS" means each of the representations set out in Clauses
8.1.
"SECURED ASSETS" means the Properties on which a Security Interest is created in
favour of a Secured Creditor.
8
"SECURED CREDITORS" means the creditor in whose favour the Borrower shall have
credited Security Interest for securing the Indebtedness of the Borrower to that
creditor.
"SECURED INDEBTEDNESS" means any Indebtedness secured on any Asset
"SECURITY DOCUMENT" means an instrument in writing and whether registered or not
and includes any memorandum or record whether in writing or recorded manually or
electronically and whether or not signed by a party or parties thereto creating
and/or evidencing the creation of a Security Interest, including Security
Sharing Agreement.
"SECURITY INTEREST" means a mortgage, charge, pledge, lien or other security
interest securing an obligation of any person on any property or assets or any
other agreement or arrangement having a similar effect.
"SECURITY SHARING AGREEMENT means an agreement made by and between all the
Secured Creditors in form and substance satisfactory to the Lenders, providing
for sharing of the realization proceeds including moneys received under
insurance policies, on a pari passu basis, as between all the Secured Creditors,
notwithstanding anything to the contrary contained in any Security Document made
by and between the Borrower and any Secured Creditor and confirmed by the
Borrower by a separate letter or becoming party thereto as may be required by
the Lenders.
"STERLITE" means Sterlite Industries (India) Limited.
"STERLITE GROUP" means Sterlite and its Affiliates.
"SUBSIDIARY" means a subsidiary within the meaning of section 4 of the Companies
Xxx 0000 (1 of 1956).
"TAKEOVER CODE" means the Securities and Exchange Board of India (Substantial
Acquisition of Shares and Takeovers) Regulations, 1997.
"TAX" means any tax, levy, cess, impost, duty or other charge or withholding of
a similar nature (including any penalty or interest payable in connection with
any failure to pay or any delay in paying any of the same).
"TERMINATION DATE" means the last date of Availability Period.
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"TOTAL COMMITMENT A" means aggregate amount of the Commitment A mentioned in
Part II A of Schedule 1.
"TOTAL COMMITMENT B" means the aggregate amount of the Commitment B mentioned in
Part II B in Schedule 1.
"TRANSFER CERTIFICATE" means a certificate substantially in the form set out in
Schedule 4 (Form of Transfer Certificate) or any other form agreed between the
Agent and Security Trustee and the Borrower.
"TRANSFER DATE" means, in relation to a transfer, the later of:
(a) the proposed Transfer Date specified in the Transfer Certificate; and
(b) the date on which the Agent and Security Trustee executes the Transfer
Certificate.
"UNPAID SUM" means any sum due and payable but unpaid by the Borrower under the
Finance Documents.
"VALUE OF SECURED ASSETS" means the aggregate Written Down Value of the Assets
on which Security Interests shall have been created to secure any Indebtedness
of the Borrower.
"WRITTEN DOWN VALUE OF AN ASSET," means the cost of acquisition of that Asset as
reduced by the depreciation provided upto the date on which the written down
value is to be arrived at as provided under Schedule XIV to the Companies Act,
1956.
1.2 CONSTRUCTION
(a) Unless a contrary indication appears, any reference in this Agreement to:
(i) The "AGENT AND SECURITY TRUSTEE", the "ARRANGER", any "FINANCE PARTY", any
"LENDER", the "BORROWER" or any "PARTY" shall be construed so as to include
its successors in title, permitted assigns and permitted transferees;
(ii) A "FINANCE DOCUMENT" or any other agreement or instrument is a reference to
that Finance Document or other agreement or instrument as amended or
novated;
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(iii) A "PERSON" includes any person, firm, company, corporation, government,
state or agency of a state or any association, trust or partnership
(whether or not having separate legal personality) or two or more of the
foregoing;
(iv) A "REGULATION" includes any regulation, rule, official directive, request
or guideline (whether or not having the force of law) of any governmental,
intergovernmental or supranational body, agency, department or regulatory,
self-regulatory or other authority or organisation as amended or
re-enacted;
(v) A provision of law is a reference to that provision as amended or
re-enacted; and
(vi) A time of day is a reference to Mumbai time.
(ix) Singular includes plural and vice-versa and reference to any gender
includes other gender/s.
(b) Section, Clause and Schedule headings are for ease of reference only.
(c) Unless a contrary indication appears, a term used in any other Finance
Document or in any notice given under or in connection with any Finance
Document has the same meaning in that Finance Document or notice as in this
Agreement.
(d) A Default (other than an Event of Default) is "CONTINUING" if it has not
been remedied or waived and an Event of Default is "CONTINUING" if it has
not been [remedied or waived]
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CLAUSE 2
FACILITIES AND DRAWDOWN CONDITIONS
2.1 FACILITIES
2.1.1 FACILITY A
Subject to the terms of this Agreement, the Lenders shall make available to the
Borrower Facility A in an aggregate amount equal to the Total Commitment A as
specified for each Lender in Part II A of Schedule 1 to this Agreement and the
Borrower agrees to borrow from the Lenders a sum of money equal to the Total
Commitment A.
2.1.2 FACILITY B
Subject to the terms of this Agreement, the Lenders shall make available to the
Borrower Facility B in an aggregate amount equal to the Total Commitment B as
specified for each Lender in Part II B of Schedule 1 to this Agreement and the
Borrower agrees to borrow from the Lenders a sum of money equal to the Total
Commitment B.
2.1.3 CONVERSION OF LOAN A TO LOAN B AND VICE-VERSA:
On the day following an Interest Payment Date, a Lender may, with the consent of
the Borrower convert its participation in Loan A to Loan B or its participation
in Loan B to Loan A, subject to the Borrower executing and registering such
deeds of modification or variation to the Finance Documents, as may be required
by that Lender.
2.2 FINANCE PARTIES' RIGHTS AND OBLIGATIONS
(a) The obligations of each Finance Party under the Finance Documents are
several. Failure by a Finance Party to perform its obligations under the
Finance Documents does not affect the obligations of any other Party under
that Finance Document. No Finance Party is responsible for the obligations
of any other Finance Party under the Finance Documents.
(b) The rights of each Finance Party under or in connection with the Finance
Documents are separate and independent rights and any debt arising under
the Finance Documents to a Finance Party from the Borrower shall be a
separate and independent debt.
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(c) A Finance Party may, except as otherwise stated in the Finance Documents,
separately enforce its rights under the Finance Documents.
2.3 PURPOSE
The Borrower shall apply all amounts borrowed by it under the Facilities towards
financing of the Project.
2.4 CONDITIONS OF DRAWDOWN
2.4.1 INITIAL CONDITIONS PRECEDENT
The Borrower agrees not to deliver a Drawdown Request unless the Agent and
Security Trustee has received all of the documents including creation of
Security Interest by way of hypothecation on all its Other Properties as
provided in Clause 7 set out hereinafter and subject to such Security Interests
providing the Security cover of 1.33 times and other evidence listed in and
appearing to comply with the requirements of Schedule 2 (Conditions precedent).
The Agent and Security Trustee shall notify the Borrower and the Lenders
promptly upon receiving such documents and other evidence.
2.4.2 FURTHER CONDITIONS PRECEDENT
The Lenders will only be obliged to comply with Clause 3.2 (Lenders'
participation) if on the date of a Drawdown Request for a Loan and on the
proposed Drawdown Date for that Loan:
(i) no Default is continuing or would result from the proposed drawdown of that
Loan;
(ii) the Repeating Representations to be made by the Borrower are true in all
material respects; and
(iii) no notification from the Agent and Security Trustee is received as per
Clause 4.2.
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2.5 FACILITY DRAWDOWN
(a) Each Drawdown shall consist of the amount of participation of each of the
Lenders in the proportion which its Commitment bears to the aggregate amount of
both the Facilities.
(b) Upon receipt of a notice for a Drawdown by the Agent and Security Trustee,
the Agent and Security Trustee shall advise each Lender to provide its
proportion in the amount of the Drawdown to be provided to the Borrower by that
Lender.
(c) Each Drawdown Request for a Commitment shall be in the amount of not less
than Rs. 50 Crores or in multiple of Rs. 50 Crores.
2.6 OTHER CONDITIONS FOR DRAWDOWN
Such part of the amount of a Facility, which has not been drawn within the
Availability Period shall be cancelled and no Lender shall be obliged to provide
its part of the Available Commitment in that Facility after the end of the
Availability Period.
CLAUSE 3
DRAWDOWN
3.1 DRAWDOWN
3.1.1 DELIVERY OF DRAWDOWN REQUEST
The Borrower shall drawdown a Facility by delivery to the Agent and Security
Trustee of a duly completed request, eight Business Day before the proposed
Drawdown Date, in the form contained in Schedule 3 hereto for the amount of a
Loan in that Facility, which shall not be drawndown later than the Termination
Date.
3.1.2 DRAWDOWN REQUEST IRREVOCABLE
(a) A Drawdown Request is irrevocable and will not be regarded as having been
duly completed unless:
(i) the proposed Drawdown Date for that Drawdown is a Business Day within the
Availability Period.
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(ii) the amount of that Drawdown complies with Clause 3.2.
(b) Only one Drawdown may be requested in each Drawdown Request.
3.2 LENDERS' PARTICIPATION
Upon receiving a request for Drawdown from the Borrower the Agent and Security
Trustee will promptly notify the Lenders of the receipt of the request from the
Borrower stating the amount of such Drawdown and the amount of each Lenders
portion in that Drawdown each Loan and the amount of its participation in that
Loan.
Within two (2) Business Days from receipt of the Drawdown request from the
Borrower, and after due verification, the Agent and Security Trustee shall
notify the Lenders of the Borrowers compliance with the aforesaid conditions.
(a) If the conditions set out in this Agreement have been met, each Lender
shall make its participation in each Drawdown available by the Drawdown
Date for that Drawdown in the relevant Facility through its Facility
Office.
(b) The amount of each Lender's participation in each Loan will be equal to the
proportion borne by its relevant Available Commitment in the relevant
Facility immediately prior to the making of that Loan.
3.3 DISBURSEMENT OF LOAN
The Lenders shall make available the Drawdown requested for, on the Drawdown
Date of that Drawdown directly to the Borrower by crediting the account of the
Borrower with its bankers as specified in the notice for that Drawdown.
CLAUSE 4
REPAYMENT, PREPAYMENT AND CANCELLATION
4.1. REPAYMENT OF LOANS
The Borrower shall repay each Loan outstanding on the Termination Date in eight
equal quarterly Repayment Instalments on the successive Repayment Dates
commencing from the 51st month from the first Drawdown.
4.2 CHANGE OF CONTROL
If the Sterlite Group ceases to control the Borrower:
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(i) the Borrower shall promptly notify the Agent and Security Trustee upon
becoming aware of that event; and
(ii) if the Majority Lenders so require, the Agent and Security Trustee shall,
by not less than 7 (Seven) days notice to the Borrower, cancel the Facility
and if the Facility is drawndown, declare the Loan, together with accrued
interest, and all other amounts accrued under the Finance Documents
immediately due and payable, whereupon all such outstanding amounts will
become immediately due and payable.
4.3 VOLUNTARY CANCELLATION
The Borrower shall have no right to cancel or reduce the amount of the Facility
agreed to be provided to it.
4.4 VOLUNTARY PREPAYMENT OF THE LOANS
The Borrower may prepay all or any part of a Loan to all the Lenders
proportionately. Any such prepayment shall be applied against the Repayment
Instalments in inverse order of maturity.
CLAUSE 5
INTEREST, INTEREST PERIODS
5.1 INTEREST
5.1.1 CALCULATION OF INTEREST.
The rate of interest on each Loan for each Interest Period shall be as under:-
INTEREST ON LOAN A
The rate of interest on the Loan A for each Interest Period shall be [7]% per
annum payable on a monthly basis.
INTEREST ON LOAN B
The rate of interest on Loan B for each Interest Period shall be (6.50)% per
annum liable to be reset on the third anniversary of the first Drawdown Date.
16
The rate of interest as aforesaid may be reset by a Lender after the third
anniversary of the first Drawdown. A Lender desirous of resetting the rate of
interest as aforesaid shall sent an intimation to the Agent and Security Trustee
about the resetting of the rate of interest and advising therein the proposed
revised rate of interest. Promptly on receipt of such a request from any one or
more Lenders the Agent and Security Trustee shall give a 30 days prior notice to
the Borrower resetting therein the revised rate of interest (hereinafter
referred to as the "Reset Rate") on Loan B to be effective from the 30th day of
the date of such notice.
The Borrower, after receipt of such notice from such Agent, shall, not later
than 10 days therefrom advise the Agent as to the Reset Rate acceptable to the
Borrower. If the Reset Rate accepted by the Borrower is not acceptable to a
Lender, the Borrower shall prepay the participation of that Lender not later
than 30 days after the Reset Date together with accrued interest at the then
existing rate of interest but without prepayment penalty. If the Reset Rate
acceptable to the Borrower but is not acceptable to a Lender, that Lender shall
be entitled to call upon the Borrower to prepay its participation in that Loan
and the Borrower shall, in that event, prepay that Lender's participation in the
Loan within 30 days after the Reset Date together with accrued interest thereon
at the then existing rate of interest but without prepayment penalty.
"Reset Date" for the purpose of this clause means the date on which the Reset
Rate on Loan B comes into force following 30 days prior notice by the Lender
proposing the revision in the interest rate, varied every third year from the
first Drawdown.
5.1.2 PAYMENT OF INTEREST
The Borrower shall pay accrued interest on the Loan on the last day of each
Interest Period. The interest payments shall be made at par in Mumbai to the
Lenders.
5.1.3 DEFAULT INTEREST
(a) If the Borrower fails to pay any amount payable by it under a Finance
Document on its due date, interest shall accrue on the Unpaid Sum from the
due date up to the date of actual payment (both before and after judgment)
at a rate which, subject to paragraph (b) below, is 2 (two) per cent above
the applicable interest rates depending upon whether such Unpaid Sum
relates to Loan A or Loan B. Any interest accruing under this clause 5.1.3
shall be immediately payable by the Borrower forthwith on demand of the
Agent and Security Trustee or of the Lenders on failure of the Trustee to
make demand.
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(b) If any Unpaid Sum consists of all or part of a Loan which became due on a
day which was not the last day of an Interest Period:
(i) the first Interest Period for that Unpaid Sum shall have a duration
equal to the unexpired portion of the current Interest Period; and
(ii) the rate of interest applying to the Unpaid Sum during that first
Interest Period shall be 2 per cent higher than the rate which would
have applied if the Unpaid Sum had not become due.
(c) Default interest arising on an Unpaid Sum will be paid on a daily rest
basis and shall be paid with the Unpaid Sum at the end of each Interest
Period applicable to that Unpaid Sum but will remain immediately due and
payable.
5.2 INTEREST PERIODS
5.2.1 FIRST INTEREST PERIOD AND THE LAST INTEREST PERIOD
The first Interest Period in respect of the Drawdown of a Loan shall commence
from its Drawdown Date and end on the last day of the calendar month in which
that Drawdown shall have been drawndown. Each Interest Period, other than the
first Interest Period and the last interest Period, in respect of a Loan shall
commence from the end of the preceding Interest Period, and end on the last day
of the next succeeding calendar month in which that Interest Period has
commenced.
Provided however, the last Interest Period in respect of a Loan shall end on the
last Repayment Date for that Loan.
5.2.2 NON-BUSINESS DAYS
If an Interest Period would otherwise end on a day which is not a Business Day,
that Interest Period will instead end on the next Business Day in that calendar
month (if there is one) or the preceding Business Day (if there is not).
5.2.3 ADDITIONAL INTEREST
If the Borrower fails to execute and register (wherever required) the Mortgage
in form and substance satisfactory to the Majority Lenders (i) within six months
from the first Drawdown Date on the Immovable Properties, the Borrower shall pay
to the Finance
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Parties, additional interest @ 0.5% per month on the Loan Amounts commencing
from the expiration of six months, until such time as the Mortgage shall have
been created, registered and perfected to the satisfaction of the Agent and
Security Trustee, in addition to the interest payable as provided in Clause
5.1.1 set out hereinbefore.
CLAUSE 6
ADDITIONAL PAYMENT OBLIGATIONS
6.1 STAMP DUTY AND OTHER TAXES
The Borrower shall (a) pay and (b) within seven Business Days of demand,
indemnify each Finance Party against any cost, loss or liability that Finance
Party incurs in relation to all stamp duty, registration and other similar Taxes
payable in respect of any every Finance Document.
6.2 INDIRECT TAX
(a) All consideration expressed to be payable under a Finance Document by the
Borrower to a Finance Party shall be deemed to be exclusive of any Indirect Tax.
If any Indirect Tax is chargeable on any supply made or services rendered by any
Finance Party to any Party in connection with a Finance Document, that Party
shall pay to the Finance Party (in addition to and at the same time as paying
the consideration) an amount equal to the amount of the Indirect Tax.
(b) Where a Finance Document requires any Party to reimburse a Finance Party
for any costs or expenses, that Party shall also at the same time pay and
indemnify the Finance Party against all Indirect Tax incurred by that Finance
Party in respect of the costs or expenses to the extent the Finance Party
determines that it is not entitled to credit or repayment in respect of the
Indirect Tax.
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6.3 OTHER INDEMNITIES
6.3.1 Indemnity to Finance Parties
The Borrower shall within (7) Seven Business Days of demand, indemnify each
Finance Party against any cost, loss or liability incurred by that Finance Party
as a result of:
(a) the occurrence of any Event of Default;
(b) any information produced or provided by the Borrower being misleading
and/or deceptive in any respect;
(c) any enquiry, investigation, subpoena (or similar order) or litigation with
respect to the Borrower or with respect to the transactions contemplated or
financed under this Agreement;
(d) a failure by the Borrower to pay any amount due under a Finance Document on
its due date, including without limitation, any cost, loss or liability
arising as a result of Clause 11.3 (Sharing among the Finance Parties);
(e) funding, or making arrangements to fund, its participation in a Loan
requested by the Borrower in a Drawdown Request but not drawn down (other
than by reason of default or negligence by that Finance Party alone); or
(f) the Loan (or part of the Loan) not being prepaid in accordance with a
notice of prepayment given by the Borrower.
6.3.2 INDEMNITY TO THE AGENT AND SECURITY TRUSTEE
The Borrower shall promptly indemnify the Agent and Security Trustee against any
cost, charges, loss or liability incurred by the Agent and Security Trustee
(acting reasonably) under intimation to the Borrower as a result of:
(a) investigating any event which it reasonably believes is a Default; or
(b) acting or relying on any notice, request or instruction which it reasonably
believes to be genuine, correct and appropriately authorised.
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6.4 MITIGATION BY THE LENDERS
(a) Each Finance Party shall, in consultation with the Borrower, take all
reasonable steps to mitigate any circumstances which arise and which would
result in any amount becoming payable under or pursuant to, pursuant to,
any of Clause 6.1 (Stamp Taxes) Clause 6.2 (Indirect Taxes), including (but
not limited to) transferring its rights and obligations under the Finance
Documents to another Affiliate or Facility Office.
(b) Paragraph (a) above does not in any way limit the obligations of the
Borrower under the Finance Documents.
6.5 LIMITATION OF LIABILITY
(a) The Borrower shall indemnify each Finance Party for all costs and expenses
reasonably incurred by that Finance Party as a result of steps taken by it
under Clause 6.4 (Mitigation).
(b) A Finance Party is not obliged to take any steps under Clause 6.4
(Mitigation) if, in the opinion of that Finance Party (acting reasonably),
to do so might be prejudicial to it.
6.6 COSTS, CHARGES, EXPENSES AND FEES
6.6.1 TRANSACTION EXPENSES
The Borrower shall, within Seven Business Days of demand, pay the Agent and
Security Trustee and the Arranger the amount of all costs and expenses
(including legal fees) reasonably incurred by any of them in connection with the
negotiation, preparation, printing, execution and syndication of:
(a) this Agreement and any other documents referred to in this Agreement; and
(b) any other Finance Documents executed after the date of this Agreement.
6.6.2 AMENDMENT COSTS
If the Borrower requests an amendment, waiver or consent, the Borrower shall,
within Seven Business Days of demand, reimburse the Agent and Security Trustee
for the amount of all costs and expenses (including legal fees) reasonably
incurred by the
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Agent and Security Trustee in connection with such amendment waiver or consent
as relating to an evaluation, negotiation or compliance with that request or
requirement.
6.6.3 ENFORCEMENT COSTS
The Borrower shall, within (7) Seven Business Days of demand, pay to each
Finance Party the amount of all costs, charges and expenses (including legal
fees) incurred or to be incurred by that Finance Party in connection with the
enforcement of, or the preservation of any rights under, each Finance Document.
6.6.4 COMMITMENT FEES.
The Borrower shall pay to the Lenders on the Termination Date, Commitment Fee
calculated at the rate of 0.15% per annum accruing on a daily basis on the
undrawn amount of the portion of a Facility, commencing from the date hereof,
till the Termination Date.
CLAUSE 7
SECURITY INTEREST AND SECURITY DOCUMENTS
The Borrower hereby unconditionally and irrevocably undertakes to the Finance
Parties that it shall create and perfect the Security Interests including
registering the same in form and substance satisfactory to the Agent and
Security Trustee
a) on or before the first Drawdown, a pari passu charge on the existing
hypothecation of all the Other Properties under a registered joint deed of
hypothecation executed in favour of the Agent and Security Trustee in trust
for and for the benefit the Finance Parties; and
b) within six months after the first Drawdown mortgage of all the Immovable
Properties either by way of mortgage by deposit of title deeds or
registered English mortgage in favour of the Agent and Security Trustee in
trust for and for the benefit of the Finance Parties by executing,
delivering and registering such security documents including Security
Sharing Agreement executed between the Finance Parties and other Secured
Creditors providing for inter-se ranking of the Security Interest on a pari
passu basis,
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so as to secure repayment and payment of the Loan Amounts by the Borrower to the
Finance Parties on a pari-passu basis, as between the Finance Parties inter-se
and as between the Secured Creditors inter-se.
Provided that the aforesaid charge by way of hypothecation and mortgage shall
rank pari passu with the hypothecations and/or mortgages created or to be
created as security for repayment and payment of Existing Secured Indebtedness
in favour of or for the benefit of the Existing Secured Creditors.
Provided further that, the Borrower shall be at liberty to create any further or
other Security Interests to secure repayment and payment its Future
Indebtedness, on the condition that aggregate value of the Secured Assets shall
not be less than 1.33 times of the aggregate amount of the Secured Indebtedness.
Provided further that no Loan is sought to be secured by way of mortgage by or
under this Agreement and this Agreement is not an agreement to mortgage any
Immovable Property.
CLAUSE 8
REPRESENTATIONS, UNDERTAKINGS, COVENANTS AND EVENTS OF DEFAULT
8.1 REPRESENTATIONS
The Borrower makes the representations and warranties set out in this Clause 8
to each Finance Party on the date of this Agreement.
8.1.1 STATUS
(a) It is a company, duly incorporated and validly existing under the laws of
India.
(b) It and each of its Subsidiaries has the power to own its assets and carry
on its business as it is being conducted.
8.1.2 BINDING OBLIGATIONS
(a) The Borrower declares and confirms that the Facility agreed to be granted
to the Borrower shall be governed by the terms and conditions as herein
contained, as well as those embodied in the relative Finance Documents.
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(b) The obligations expressed to be assumed by it in each Finance Document are,
subject to any general principles of law limiting its obligations which are
specifically referred to in any legal opinion delivered in accordance with
Clause 2.4 read with Schedule 2 (Conditions Precedent of Drawdown) legal,
valid, binding and enforceable obligations.
8.1.3 NON-CONFLICT WITH OTHER OBLIGATIONS
The entry into and performance by the Borrower of, and the transactions
contemplated by, the Finance Documents do not and will not conflict with:
(a) any law or regulation applicable to it;
(b) constitutional documents of the Borrower, or any company which is the
Subsidiary of the Borrower;
(c) any agreement or instrument binding upon it or any company which is a
member of Sterlite Group; or
(d) does not cause any limitation on any of the powers whatsoever of the
Borrower however imposed, or on the right or ability of the directors of
the Borrower to exercise such powers to be exceeded.
8.1.4 POWER AND AUTHORITY
(a) It has the power to enter into, perform and deliver, and has taken all
necessary action to authorise its entry into, performance and delivery of,
the Finance Documents to which it is a party and the transactions
contemplated by those Finance Documents;
(b) the copies, certified by the Borrower's Company Secretary to be true, of
the Certificate of Incorporation and the Memorandum and Articles of
Association of the Borrower are true and effective and the Borrower shall
not during the currency of this Agreement cause any alterations to be made
in any of them which would adversely affect the financial condition of the
Borrower to service a Loan, without prior notification to and written
consent of the Agent and Security Trustee; and
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(c) the resolutions passed by the Borrower in general meeting on [July 26,
2004] consenting to the board of directors borrowing moneys in excess of
the aggregate of the paid up capital of the Borrower and its free reserves,
a certified copy of the minutes of which has been delivered by the Borrower
to the Agent and Security Trustee, is and, during the currency of this
Agreement, shall remain adequate and effective to enable the Lenders to
grant and the Borrower to receive the credit facilities aforesaid and
mortgaging and charging the Properties as security for payment of the Loan
Amounts.
8.1.5 NO MATERIAL ADVERSE CHANGE
The audited profit and loss account of the Borrower for the year ended 31st
March, 2004 and the audited balance sheet of the Borrower as of that date give a
true and fair view of the results of the operations of the Borrower for that
period and the financial position of the Borrower as of that date and that there
has been no material change adverse to the business, assets, conditions or
operations of the Borrower since that date.
8.1.6 MORTGAGE CHARGES
Other than the Existing Security Interests created in favour of the Borrower's
banks on the Assets as more particularly set out in Schedule 7, there exists no
mortgage, charge, hypothecation, pledge, lien, encumbrance or other security
interest whatsoever over the whole or any part of the undertaking or assets,
present or future, including uncalled capital of the Borrower.
8.1.7 VALIDITY AND ADMISSIBILITY IN EVIDENCE
All Authorisations required or desirable:
(a) to enable it lawfully to enter into, exercise its rights and comply with
its obligations in the Finance Documents to which it is a party;
(b) to make the Finance Documents to which it is a party admissible in evidence
in its jurisdiction of incorporation;
(c) for it and its Subsidiaries to carry on their business, and which are
material,
have been obtained or effected and are in full force and effect.
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8.1.8 NO DEFAULT
(a) No Event of Default is continuing or might reasonably be expected to result
from the making of a Loan.
(b) No other event or circumstance is outstanding which constitutes a default
under any other agreement or instrument which is binding on the Borrower or
any of its Subsidiaries or to which its (or its Subsidiaries') assets are
subject which might have a Material Adverse Effect.
8.1.9 NO MISLEADING INFORMATION
(a) Any factual information provided by the Borrower or any of its Subsidiaries
was true and accurate in all material respects as at the date it was
provided or as at the date (if any) at which it is stated.
(b) Any financial information provided to the Lenders has been prepared on the
basis of the latest information and on the basis of reasonable assumptions.
8.1.10 FINANCIAL STATEMENTS
(a) Its Original Financial Statements were prepared in accordance with GAAP
consistently applied save to the extent expressly disclosed in such
Original Financial Statements.
(b) Its Original Financial Statements give a true and fair view and represent
its financial condition and operations (consolidated in the case of the
Borrower) during the relevant financial year save to the extent expressly
disclosed in such Original Financial Statements.
8.1.11 PARI PASSU RANKING
Its payment obligations under the Finance Documents rank at least pari passu
with the claims of all its other unsecured and unsubordinated creditors, except
for obligations mandatorily preferred by law applying to companies generally.
8.1.12 NO PROCEEDINGS PENDING OR THREATENED
No litigation, arbitration or administrative proceedings of or before any court,
arbitral body or agency which, if adversely determined, might reasonably be
expected to have
26
a Material Adverse Effect have (to the best of its knowledge and belief) been
started or threatened against it or any of its Subsidiaries.
8.1.13 AUTHORISED SIGNATURES
Any person specified as its authorised signatory under Schedule 2 (Conditions
precedent to Drawdown ) or Clause 8.2.4 (d) is authorised to sign Drawdown
Requests and other notices on its behalf.
8.1.14 AUTHORISATIONS
The Borrower has obtained and will obtain all authorizations from the relevant
Governmental Agencies required for the business or activities of the Borrower
including:
(a) all necessary environment and other clearances for the expansion and
modernization; and
(b) the necessary licenses/agreement/contracts and the regulatory approvals
required for expansion and Modernization Project to be financed under this
Facility.
8.1.15 WINDING UP
No action for the voluntary or compulsory winding up of the Borrower has been
initiated by the Borrower or any creditors or shareholders.
8.1.16 REPETITION.
The Repeating Representations are deemed to be made by the Borrower by reference
to the facts and circumstances then existing on the date of the Drawdown Request
and the first day of each Interest Period.
8.1.17 SECURITY.
Each Security Document to which the Borrower is a party validly creates or will,
upon execution thereof by the Borrower, create each of the encumbrances which is
expressed to be created by that Security Document and evidences each of the
encumbrance it is expressed to evidence.
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8.1.18 GOOD TITLE TO ASSETS.
The Borrower has good, valid and marketable title to, or valid leases or
licences of, and all appropriate Authorisations to use, the Assets necessary to
carry on its business as presently conducted.
8.1.19 LEGAL AND BENEFICIAL OWNER.
The Borrower is the absolute legal owner and beneficial owner of all the Assets
excluding mining leases, which it is entitled, in accordance with the terms of
the respective leases and the Assets other than Current Assets are free from
encumbrances.
8.1.20 INSURANCE.
The Borrower has taken insurance of all its assets on the replacement value
basis and shall modify the same on such terms and conditions as may be
stipulated by the Agent and Security Trustee in consultation with the Lenders.
8.2 OTHER FINANCIAL STATEMENTS AND COMPLIANCE CERTIFICATES
8.2.1 OTHER FINANCIAL STATEMENTS
The Borrower shall supply to the Agent and Security Trustee in sufficient copies
for all the Lenders:
(a) as soon as the same become available, but in any event within 90 (ninety)
days after the end of each of its financial years its audited consolidated
financial statements for that financial year;
(b) as soon as the same become available, but in any event within 60 (sixty)
days after the end of each half of each of its financial years its
consolidated financial statements for that financial half year.
8.2.2 COMPLIANCE CERTIFICATES
(a) The Borrower shall supply to the Agent and Security Trustee, with each set
of financial statements delivered pursuant to paragraph (a) or (b) of
Clause 8.1.10 (Financial statements), a Compliance Certificate setting out
(in reasonable
28
detail) computations as to compliance with Clause 8.3 (Financial covenants)
as at the date as at which those financial statements were drawn up.
(b) Each Compliance Certificate delivered pursuant to paragraph (a) of Clause
8.1.10 (Financial statements) shall in addition be reported on by the
Borrower's auditors in the form agreed by the Borrower and all the Lenders
before the date of this Agreement.
8.2.3 REQUIREMENTS AS TO FINANCIAL STATEMENTS
(a) Each set of financial statements delivered by the Borrower pursuant to
Clause 8.1.10 (Financial statements) shall be certified by a director of
the Borrower as fairly representing its financial condition as at the date
as at which those financial statements were drawn up.
(b) The Borrower shall provide a certificate to the effect that each set of
Financial Statements delivered pursuant to Clause 8.1.10 (Financial
statements) is prepared using GAAP.
(c) The Borrower shall confirm to the Finance Parties that each set of
financial statements is delivered pursuant to Clause 8.1.10 (Financial
statements) and prepared using GAAP, accounting practices and financial
reference periods is consistent with those applied in the preparation of
the Original Financial Statements for the Borrower unless, in relation to
any set of financial statements, it notifies the Agent and Security Trustee
that there has been a change in GAAP, the accounting practices or reference
periods and its auditors deliver to the Agent and Security Trustee:
(i) a description of any change necessary for those financial statements
to reflect the GAAP, accounting practices and reference periods upon
which that Borrower's Original Financial Statements were prepared; and
(ii) sufficient information, in form and substance as may be reasonably
required by the Agent and Security Trustee, to enable the Lenders to
determine whether Clause 8.3 (Financial covenants) has been complied
with and make an accurate comparison between the financial position
29
indicated in those financial statements and that in the Borrower's
Original Financial Statements.
Any reference in this Agreement to those financial statements shall be
construed as a reference to those financial statements as adjusted to
reflect the basis upon which the Original Financial Statements were
prepared.]
8.2.4 INFORMATION: MISCELLANEOUS
The Borrower shall supply to the Agent and Security Trustee (in sufficient
copies for all the Lenders, if the Agent and Security Trustee so requests):
(a) all documents dispatched by the Borrower to its shareholders (or any class
of them) or its creditors generally at the same time as they are
despatched;
(b) promptly upon becoming aware of them, the details of any litigation,
arbitration or administrative proceedings which are current, threatened or
pending against, the Borrower or any of its subsidiaries and which might,
if adversely determined, have a Material Adverse Effect;
(c) promptly, such further information regarding the financial condition,
business and operations of any Member of Sterlite Group as any Finance
Party (through the Agent and Security Trustee) may reasonably request; and
(d) promptly, notice of any change in authorised signatories of the Borrower
signed by a director or company secretary of the Borrower accompanied by
specimen signatures of any new authorised signatories.
8.2.5 NOTIFICATION OF DEFAULT
(a) The Borrower shall notify the Agent and Security Trustee of any Default
(and the steps, if any, being taken to remedy it) promptly upon becoming
aware of its occurrence.
(b) Promptly upon a request by the Agent and Security Trustee, the Borrower
shall supply to the Agent and Security Trustee a certificate signed by one
of its directors or senior officers on its behalf certifying that no
Default is continuing (or if a Default is continuing, specifying the
Default and the steps, if any, being taken to remedy it).
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8.2.6 INFORMATION UNDERTAKINGS
The undertakings in this Clause 8 shall remain in force from the date of this
Agreement for so long as any amount is outstanding under the Finance Documents
or any Commitment is in force.
8.3 FINANCIAL COVENANTS
8.3.1 FINANCIAL CONDITIONS
The Borrower shall ensure that:
(a) the Total Debt over the Tangible Net Worth, which includes deferred
taxation will not at any time be greater than 1.5X.
(b) Interest Cover Ratio is greater than or equal to 2X. (EBITDA/ Gross
interest);
(c) the minimum Asset Cover is 1.33X.
(d) DSCR is greater than or equivalent to 1.25X (PBDIT-Tax) / (Interest +
Current maturities of long term debt)
(e) Minimum Networth shall be Rs. 1000 crores by 31st March 2006 onwards and
Rs. 600 crores prior to 31st March 2006.
For the purpose of this Clause 8.3.1:
"ASSET COVER" means aggregate of the assets consisting of net block,
investments, as increased by the capital works in progress divided by the
loans secured by such Assets, from time to time.
"DEBT SERVICE COVER RATIO" "DSCR" means EBITDA minus tax divided by interest and
current maturity of long term debts.
"EBITDA" means, in relation to any Relevant Period, the total operating profit
of the Borrower for that Relevant Period before taking into account:
(a) Interest Expense;
(b) Tax;
(c) Any share of the profit of any associated company or undertaking, except
for dividends received in cash by the Borrower; and
(d) Extraordinary and exceptional items,
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after adding back all amounts provided for depreciation and amortisation for
that Relevant Period, as determined (except as needed to reflect the terms of
this Clause 8.3) from the financial statements of the Borrower and Compliance
Certificates delivered under Clause 8.2 (Other Financial statements) and Clause
8.2.2 (Compliance Certificates).
"INTEREST COVER" means EBITDA divided by Gross Interest.
"GROSS INTEREST" means interest expenses shown in the profit and loss account
schedule and excludes any interest income.
"TOTAL DEBT" means all secured and unsecured liabilities such as loans,
difference of current liabilities over current assets as disclosed in the
financial statements of the Borrower prepared from time to time, as reduced by
cash balances and liquid investments.
"TANGIBLE NET WORTH" means net worth of the Borrower excluding deferred revenue
expenditure and goodwill but including deferred taxation.
8.4 OTHER COVENANTS
8.4.1 AFFIRMATIVE COVENANTS
The Borrower covenants that :
(a) the majority stake of not less than 51% of the paid up equity share capital
or voting share capital whichever is higher shall remain with the Sterlite
Group.
(b) any loans/deposits by the Borrower to any member of Sterlite Group shall be
undertaken with the prior consent of the Lenders.
(c) independent certified engineer appointed by the Lenders shall certify the
Project completion activities for the entire expansion and monitor and
report progress on a six monthly basis. Project milestones as well as
project completion date as certified by the independent certified engineer
will be adhered to.
(d) all subsequent financing shall be with permission of the Original Lenders
and shall at all times rank pari-passu or subordinated with the terms and
conditions
32
and repayment schedule under this agreement. Such covenant shall not have
any cure period and shall be considered an accelerated Event of Default.
(e) Assignment of the performance/completion guarantees for the project
components other than the captive power plant, shall be made in favour of
the Agent and Security Trustee in the event of the occurrence of any Event
of Default under this Agreement.
(f) No dividend shall be paid by the Borrower where any of the terms of lending
or conditions defined in this Agreement is in default. Such events shall
include without limitation cross default, payment default, other breaches
of facility agreement, misrepresentation, insolvency (and insolvency
proceedings), cessation or material change of business, attachment or
execution, changes in the constitution of the Borrower and Material and
Adverse Effect in the Financial condition or operation of the Borrower.
8.4.2 AUTHORISATIONS
The Borrower shall promptly:
(a) obtain, comply with and do all that is necessary to maintain in full force
and effect; and
(b) supply certified copies to the Agent and Security Trustee of,
any Authorisation required to enable it to perform its obligations under the
Finance Documents and to ensure the legality, validity, enforceability or
admissibility in evidence in its jurisdiction of incorporation of any Finance
Document.
8.4.3 COMPLIANCE WITH LAWS
The Borrower shall comply in all respects with all laws to which it may be
subject, if failure so to comply would materially impair its ability to perform
its obligations under the Finance Documents.
8.4.4 INSURANCE.
(a) The Borrower has obtained and shall always maintain insurances on all its
Assets on replacement value basis or on such other basis and against fire,
earthquake,
33
riots, civil commotion and such other risks as may be reasonably prescribed by
the Agent and Security Trustee from time to time in consultation with the
Lenders. The insurance policies in this regard shall be either assigned to the
Agent and Security Trustee in trust for and for the benefit of the Finance
Parties or the Agent and Security Trustee and the Finance Parties may be
notified therein as loss payees with a suitable mortgage and hypothecation
clause as may be required by the Agent and Security Trustee.
(b) The insurance policies shall, if so required by the Agent and Security
Trustee be deposited with the Agent and Security Trustee and may be made
available by the Agent and Security Trustee for inspection by the Borrower or
for lodgement of any claim by the Borrower.
(c) The Borrower shall take forthwith insurance against such risk and on such of
the assets as and when they are brought into existence.
(d) The interest of each Secured Creditor in the proceeds of any claim under an
insurance policy shall rank pari passu inter-se.
8.5 NEGATIVE COVENANTS
8.5.1 MAINTENANCE OF SECURITY COVER
The Borrower shall not borrow and / or create or permit to subsist any Security
Interest over any of the Secured Assets if as a result of such borrowing or
creation of Security Interest, the Borrower is not in a position to maintain the
security cover of 1.33 times of the aggregate value of the Secured Assets over
the Indebtedness including the Future Indebtedness proposed to be incurred by
the Borrower.
8.5.2 DISPOSALS
(a) The Borrower shall not and shall ensure that none of its Subsidiaries shall
enter into any transaction or a series of transaction (whether related or
not) and whether voluntary or involuntary to sell, lease, transfer or
otherwise dispose off any of the assets of the value of which exceeds Rs.
10 crores (Rupees ten crores) in a single transaction.
34
(b) Paragraph (a) above does not apply to any sale, lease, transfer or other
disposal:
(i) made in the ordinary course of trading of the disposing entity;
(ii) of assets in exchange for other assets comparable or superior as to
type, value and quality and for a similar purpose; or
(iii) where the higher of the market value or consideration receivable
(when aggregated with the higher of the market value or consideration
receivable for any other sale, lease, transfer or other disposal,
other than any permitted under paragraphs (i) to (ii) above) does not
exceed Rs. 10 crores (Rupees ten crores) (or its equivalent in another
currency or currencies) in any financial year.
8.5.3 MERGER
Without the approval of the Agent and Security Trustee the Borrower shall not
and shall also ensure that no Subsidiary of the Borrower, enters into any
amalgamation, demerger, merger or corporate reconstruction.
8.5.4 CHANGE OF BUSINESS
The Borrower shall procure that no substantial change is made to the general
nature of the business of the Borrower or the Sterlite Group from that carried
on at the date of this Agreement without prior written approval of Majority
Lenders.
8.6 GENERAL UNDERTAKINGS
The covenants and undertakings in this Clause 8 shall remain in force from the
date of this Agreement for so long as any amount is outstanding under the
Finance Documents or any Commitment is in force.
8.7 COVENANT TESTING
All covenants and terms and conditions unless otherwise specified, will be
tested annually on audited statement of accounts.
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8.8 GRANT OF WAIVER
Any waiver in the observance or in the compliance of any of the covenants or any
change therein shall be granted to the Borrower only with the consent of the
Majority Lenders.
CLAUSE 9
EVENTS OF DEFAULT
Each of the events or circumstances set out in Clause 9 below is an Event of
Default.
9.1 NON-PAYMENT
The Borrower does not pay on the due date any amount payable pursuant to a
Finance Document at the place at and in the currency in which it is expressed to
be payable unless:
(a) its failure to pay is caused by administrative or technical error; and
(b) payment is made within 3 (three) Business Days of its due date.
9.2 BREACH OF COVENANTS/UNDERTAKINGS
(i) Any of the requirements set out in Clause 8.2 (Financial Statements and
Compliance certificates) is not complied with or the Borrower fails to
carry out its obligations, as provided therein;
(ii) The Borrower fails to satisfy and/or comply with any of the Financial
Covenants set out in Clause 8.3 (Financial Covenants) is not satisfied;
(iii) Any of the covenants set out in Clause 8.4 (Other Covenants) is not
satisfied, carried out or complied with as provided therein; or
(iv) There is a breach of any of the Negative Covenants set out in Clause 8.5
(Negative Covenants).
(v) If the Borrower fails to create a first pari passu charge of the existing
hypothecation of all the Other Properties as provided in Clause 7 or fails
to create a first pari passu mortgage of all the Immovable Properties as
provided in Clause 7 within the time therein specified notwithstanding the
Borrower's liability to pay Additional Interest as provided in Clause
5.2.3.
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(vi) The Borrower fails to take or maintain insurance of its Properties as
provided in Clause 8.4.4 set out hereinbefore.
9.3 OTHER OBLIGATIONS
The Borrower does not comply with any provision of the Finance Documents (other
than those referred to in Clause 9.1 (Non-payment) [and Clause 8.3 (Financial
covenants)]).
Provided that no Event of Default under paragraph (a) above in relation to
Clause 9 will be deemed to have occurred, if the failure to comply is capable of
remedy and is remedied within:
(i) in relation to Clause 9.1 (Non-payment) 7 Business Days; or
(ii) in relation to any other Event of Default three months,
of the Agent and Security Trustee giving notice to the Borrower or the Borrower
becoming aware of the failure to comply.
9.4 MISREPRESENTATION
Any representation or statement made or deemed to be made by the Borrower in
Clause 8.1 or in any other Finance Document or any other document delivered by
or on behalf of the Borrower under or in connection with any Finance Document is
or proves to have been incorrect or misleading in any material respect when made
or deemed to be made.
9.5 CROSS DEFAULT
(a) Any Financial Indebtedness of the Borrower or any of its Subsidiaries is
not paid when due nor within any originally applicable grace period.
(b) Any Financial Indebtedness of the Borrower or any of its subsidiaries is
declared to be or otherwise becomes due and payable prior to its specified
maturity as a result of an event of default (however described).
(c) Any commitment for any Financial Indebtedness of the Borrower or any of its
Subsidiaries is cancelled or suspended by a creditor of as a result of an
event of default (however described).
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(d) Any creditor of the Borrower or any of its Subsidiaries becomes entitled to
declare any Financial Indebtedness of the Borrower or any of its
Subsidiaries due and payable prior to its specified maturity as a result of
an Event of Default (however described).
(e) No Event of Default will be deemed to have occurred under this clause 9 if
the aggregate amount of Financial Indebtedness falling within paragraphs
(a) to (d) above is less than Rs 50 Crores (or its equivalent in any other
currency or currencies).
9.6 INSOLVENCY
(a) The Borrower or any of its Subsidiaries is or is presumed or deemed to be
unable or admits inability to pay its debts as they fall due, suspends
making payments on any of its debts or, by reason of actual or anticipated
financial difficulties, commences negotiations with one or more of its
creditors with a view to rescheduling any of its indebtedness.
(b) The value of the assets of the Borrower or its Subsidiaries is less than
its liabilities (taking into account contingent and prospective
liabilities).
(c) A moratorium is declared in respect of any indebtedness of the Borrower or
its Subsidiaries.
9.7 INSOLVENCY PROCEEDINGS
Any corporate action, legal proceedings or other procedure or step is taken in
relation to:
(a) the suspension of payments, a moratorium of any indebtedness, winding-up,
dissolution, administration, provisional supervision or reorganisation (by
way of voluntary arrangement, scheme of arrangement or otherwise) of the
Borrower or its Subsidiaries other than a solvent liquidation or
reorganisation of the Borrower or its Subsidiaries;
(b) a composition, assignment or arrangement with any creditor of the Borrower
or its Subsidiaries;
(c) the appointment of a liquidator (other than in respect of a solvent
liquidation of the Borrower or its Subsidiaries, receiver, administrator,
administrative
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receiver, compulsory manager, provisional supervisor or other similar
officer in respect of any of the Borrower or its Subsidiaries or any of its
assets; or
(d) enforcement of any Security Interest over any assets of the Borrower or its
Subsidiaries,
or any analogous procedure or step is taken in any jurisdiction.
9.8 CREDITORS' PROCESS
Any expropriation, attachment, sequestration, distress or execution affects any
asset or assets of the Borrower or its Subsidiaries having an aggregate value of
Rupees one crore and is not discharged within 30 (thirty) days.
9.9 OWNERSHIP OF THE BORROWER
The Borrower is not or ceases to be an Affiliate of the Sterlite Group.
9.10 UNLAWFULNESS
It is or becomes unlawful for the Borrower to perform any of its obligations
under the Finance Documents.
9.11 REPUDIATION
The Borrower repudiates a Finance Document or evidences an intention to
repudiate a Finance Document.
9.12. MATERIAL ADVERSE CHANGE
Any event or circumstance occurs which in the opinion of the Majority Lenders
might have a Material Adverse Effect.
9.13 ACCELERATION
On and at any time after the occurrence of an Event of Default [which is
continuing] the Agent and Security Trustee shall if so directed by the Majority
Lenders, by notice to the Borrower:
(a) cancel the Total Commitments whereupon they shall immediately be cancelled;
39
(b) declare that all or part of the Loan, together with accrued interest, and
all other amounts accrued or outstanding under the Finance Documents be
immediately due and payable, whereupon they shall become immediately due
and payable; and/or
(c) declare that all or part of the Loan be payable on demand, whereupon they
shall immediately become payable on demand by the Agent and Security
Trustee on the instructions of the Majority Lenders.
CLAUSE 10
CHANGES TO PARTIES
10. CHANGES TO THE LENDERS
10.1 ASSIGNMENTS AND TRANSFERS BY THE LENDERS
Subject to this Clause 10, a Lender (the "EXISTING LENDER") may:
(a) assign any of its rights; or
(b) transfer by novation any of its rights and obligations,
to another bank or financial institution or to a trust, fund or other entity
which is regularly engaged in or established for the purpose of making,
purchasing or investing in loans, securities or other financial assets (the "NEW
LENDER").
10.1.1 CONDITIONS OF ASSIGNMENT OR TRANSFER
(a) The consent of the Borrower is required for a transfer by a Lender of any
of its obligations under the Finance Documents in respect of its Commitment
unless the transfer is to another Lender or an Affiliate of a Lender.
(b) The consent of the Borrower to a transfer must not be unreasonably withheld
or delayed. The Borrower will be deemed to have given its consent seven
Business Days after the Lender has requested it unless consent is expressly
refused by the Borrower within that time for reasons to be recorded in
writing.
(c) Transfer will only be effective on receipt by the Agent and Security
Trustee of written confirmation from the New Lender (in form and substance
satisfactory
40
to the Agent and Security Trustee) that the New Lender will assume the same
obligations to the other Finance Parties as it would have been under if it
was an Original Lender.
(d) A transfer will only be effective if the procedure set out in Clause 10.1.3
(Procedure for transfer) is complied with.
(e) If:
(i) A Lender assigns or transfers any of its rights or obligations under the
Finance Documents or changes its Facility Office; and
(ii) as a result of circumstances existing at the date of the assignment,
transfer or change occurs, the Borrower becomes obliged to make extra
payment to the New Lender or Lender acting through its new Facility Office.
then the New Lender or Lender acting through its new Facility Office is only
entitled to receive payment under those Clauses to the same extent as the
Existing Lender or Lender acting through its previous Facility Office would have
been if the assignment, transfer or change had not occurred.
10.1.2 LIMITATION OF RESPONSIBILITY OF EXISTING LENDERS.
(a) Unless expressly agreed to the contrary, an Existing Lender shall not make
any representation or warranty and assumes any responsibility to a New
Lender for:
(i) the legality, validity, effectiveness, adequacy or enforceability of
the Finance Documents or any other documents;
(ii) the financial condition of the Borrower;
(iii) the performance and observance by the Borrower of its obligations
under the Finance Documents or any other documents; or
(iv) the accuracy of any statements (whether written or oral) made in or in
connection with any Finace Document or any other document,
and any representations or warranties implied by law are excluded.
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(b) Each New Lender shall be deemed to confirm to the Existing Lender and the
other Finance Parties that it:
(i) has made (and shall continue to make) its own independent
investigation and assessment of the financial condition and affairs of
the Borrower and its related entities in connection with its
participation in this Agreement and has not relied exclusively on any
information provided to it by the Existing Lender in connection with
any Finance Document; and
(ii) will continue to make its own independent appraisal of the
creditworthiness of the Borrower and its related entities whilst any
amount is or may be outstanding under the Finance Documents or any
Commitment is in force.
(c) Nothing in any Finance Document obliges an Existing Lender to:
(i) accept a re-transfer from a New Lender of any of the rights and
obligations assigned or transferred under this Clause 10.1.2; or
(ii) support any losses directly or indirectly incurred by the New Lender
by reason of the non-performance by the Borrower of its obligations
under the Finance Documents or otherwise.
10.1.3 PROCEDURE FOR TRANSFER
(a) Subject to the conditions set out in Clause 10.1.1 (Conditions of
assignment or transfer) a transfer is effected in accordance with paragraph
(b) below when the Agent and Security Trustee executes an otherwise duly
completed Transfer Certificate delivered to it by the Existing Lender and
the New Lender. The Agent and Security Trustee shall, as soon as reasonably
practicable after receipt by it of a duly completed Transfer Certificate
appearing on its face to comply with the terms of this Agreement and
delivered in accordance with the terms of this Agreement, execute that
Transfer Certificate.
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(b) On the Transfer Date:
(i) to the extent that in the Transfer Certificate, the Existing Lender
seeks to transfer by novation its rights and obligations under the
Finance Documents the Borrower and the Existing Lender shall be
released from further obligations towards one another under the
Finance Documents and their respective rights against one another
shall be cancelled (being the "DISCHARGED RIGHTS AND OBLIGATIONS");
(ii) the Borrower and the New Lender shall assume obligations towards one
another and/or acquire rights against one another which differ from
the Discharged Rights and Obligations only insofar as the Borrower and
the New Lender have assumed and/or acquired the same in place of the
Borrower and the Existing Lender;
(iii) the Agent and Security Trustee, the Arranger, the New Lender and
other Lenders shall acquire the same rights and assume the same
obligations between themselves as they would have acquired and assumed
had the New Lender been an Original Lender with the rights and/or
obligations acquired or assumed by it as a result of the transfer and
to that extent the Agent and Security Trustee, the Arranger and the
Existing Lender shall each be released from further obligations to
each other under this Agreement; and
(iv) the New Lender shall become a Party as a "Lender".
10.1.4 DISCLOSURE OF INFORMATION
Any Lender may disclose to any of its Affiliates and any other person:
(a) to (or through) whom that Lender assigns or transfers (or may potentially
assign or transfer) all or any of its rights and obligations under this
Agreement;
(b) with (or through) whom that Lender enters into (or may potentially enter
into) any sub-participation in relation to, or any other transaction under
which payments are to be made by reference to, this Agreement or the
Borrower; or
43
(c) to whom, and to the extent that, information is required to be disclosed by
any applicable law or regulation,
any information about the Borrower, the Sterlite Group and the Finance Documents
as that Lender shall consider appropriate [if, in relation to paragraphs (a) and
(b) above, the person to whom the information is to be given has entered into a
Confidentiality Undertaking.
10.1.5 DISCLOSURE OF DEFAULT
Provided that, the Borrower hereby unconditionally and irrevocably gives its
consent to and authorises and acknowledges that each of the Finance Parties has
unqualified right to disclose all or any data relating to the Borrower, the
Facility, obligations assumed/to be assumed by the Borrower in relation thereto
and default if any committed by the Borrower in discharge thereof, as a Finance
Party deems appropriate and necessary to disclose and furnish to the Reserve
Bank of India ("RBI"), Credit Information Bureau (India) Limited ("CIBIL"), any
other bank, financial institution or non-banking finance company, and to any
other agency so authorised in this behalf by the RBI, and to publish the name of
the Borrower and its directors in a newspaper or other media or in private
correspondence as may be considered appropriate by the Finance Party and that
the RBI, CIBIL, banks, financial institutions, CIBIL or any other agency as
aforesaid may use, process such information and data disclosed by the Finance
Parties in the manner as deemed fit by any of them and any of them may furnish
for consideration, the processed information and data or products thereof
prepared by them, to any banks or financial institutions and other credit
grantors or registered users.
CLAUSE 11
THE FINANCE PARTIES
11. ROLE OF THE AGENT AND SECURITY TRUSTEE AND THE ARRANGER
11.1.1 APPOINTMENT OF THE AGENT AND SECURITY TRUSTEE
(a) Each of the other Finance Parties appoints the Agent and Security Trustee
to act as its agent under and in connection with the Finance Documents.
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(b) Each of the other Finance Parties authorises the Agent and Security Trustee
to exercise the rights, powers, authorities and discretions specifically
given to the Agent and Security Trustee under or in connection with the
Finance Documents together with any other incidental rights, powers,
authorities and discretions.
(c) The Agent and Security Trustee agrees and accepts its appointment to act as
such for and on behalf and for the benefit of the Lenders. The Borrower
shall be required to pay the Agent and Security Trustee fees in the amount
and at the time as negotiated and agreed between the Agent and Security
Trustee and the Borrower.
11.1.2 DUTIES OF THE AGENT AND SECURITY TRUSTEE
(a) The Agent and Security Trustee shall promptly forward to a Party the
original or a copy of any document, which is delivered to the Agent and
Security Trustee for that Party by any other Party.
(b) Except where a Finance Document specifically provides otherwise, the Agent
and Security Trustee is not obliged to review or check the adequacy,
accuracy or completeness of any document it forwards to another Party.
(c) If the Agent and Security Trustee receives notice from a Party referring to
this Agreement, describing a Default and stating that the circumstance
described is a Default, it shall promptly notify the Finance Parties.
(d) If the Agent and Security Trustee is aware of the non-payment of any
principal, interest, commitment fee or other fee payable to a Finance Party
(other than the Agent and Security Trustee or the Arranger) under this
Agreement it shall promptly notify the other Finance Parties.
(e) The Agent and Security Trustee's duties under the Finance Documents are
solely mechanical and administrative in nature. The Agent and Security
Trustee shall have no other duties save as expressly provided for in the
Finance Documents.
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11.1.3 ROLE OF THE ARRANGER
Except as specifically provided in the Finance Documents, the Arranger has no
obligations of any kind to any other Party under or in connection with any
Finance Document.
11.1.4 NO FIDUCIARY DUTIES
(a) Nothing in this Agreement constitutes the Agent and Security Trustee or the
Arranger as a trustee or fiduciary of any other person.
(b) Neither the Agent and Security Trustee nor the Arranger shall be bound to
account to any Lender for any sum or the profit element of any sum received
by it for its own account.
11.1.5 BUSINESS WITH THE STERLITE GROUP
The Agent and Security Trustee and the Arranger may accept deposits from, lend
money to and generally engage in any kind of banking or other business with any
Member of Sterlite Group.
11.1.6 RIGHTS AND DISCRETIONS OF THE AGENT AND SECURITY TRUSTEE
(a) The Agent and Security Trustee may rely on:
(i) any representation, notice or document, resolution, certificate,
report, request, consent, order or approval furnished by the Borrower
and/or the Lender/s and believed by it to be genuine, correct and
appropriately authorised and shall have no duty to verify any
signature on any document; and
(ii) any statement purportedly made by a director, authorised person or
employee of the Borrower regarding any matters which may reasonably be
assumed to be within his knowledge or within his power to verify.
46
(b) The Agent and Security Trustee may assume (unless it has received notice to
the contrary in its capacity as agent for the Lenders) that:
(i) no Default has occurred (unless it has actual knowledge of a Default
arising) under Clause 9.1 (Non-payment));
(ii) any right, power, authority or discretion vested in any Party or the
Majority Lenders has not been exercised; and
(iii) any notice or request made (other than a Drawdown Request) is made on
behalf of and with the consent and knowledge of the Borrower.
(c) The Agent and Security Trustee may engage, pay for and rely on the advice
or services of any lawyers, accountants, surveyors or other experts under
intimation to the Borrower and shall be fully protected in so relying upon
the advice of professionals and/or experts as may be engaged in pursuance
of this Agreement.
(d) The Agent and Security Trustee may act in relation to the Finance Documents
through its personnel and agents.
(e) The Agent and Security Trustee may disclose to any other Party any
information it reasonably believes it has received as agent under this
Agreement.
(f) Notwithstanding any other provision of any Finance Document to the
contrary, neither the Agent and Security Trustee nor the Arranger is
obliged to do or omit to do anything if it would or might in its reasonable
opinion constitute a breach of any law or a breach of a fiduciary duty or
duty of confidentiality.
11.1.7 MAJORITY LENDERS' INSTRUCTIONS.
(a) Unless a contrary indication appears in a Finance Document, the Agent and
Security Trustee shall (i) exercise any right, power, authority or
discretion vested in it as Agent and Security Trustee in accordance with
any instructions given to it by the Majority Lenders (or, if so instructed
by the Majority Lenders, refrain from exercising any right, power,
authority or discretion vested in it as Agent and Security Trustee) and
(ii) not be liable for any act (or
47
omission) if it acts (or refrains from taking any action) in accordance
with an instruction of the Majority Lenders.
(b) The Agent and Security Trustee may assume that all instructions received by
it from the Majority Lenders are consistent with this Agreement and the
other Finance Documents.
(c) Unless a contrary indication appears in a Finance Document, any
instructions given by the Majority Lenders will be binding on all the
Finance Parties.
(d) The Agent and Security Trustee may refrain from acting in accordance with
the instructions of the Majority Lenders (or, if appropriate, the Lenders)
or under paragraph (d) below until it has received such security as it may
require for any cost, loss or liability (together with any associated
Indirect Tax) which it may incur in complying with the instructions.
(e) In the absence of instructions from the Majority Lenders, (or, if
appropriate, the Lenders) the Agent and Security Trustee may act (or
refrain from taking action) as it considers to be in the best interest of
the Lenders.
(f) The Agent and Security Trustee is not authorised to act on behalf of a
Lender (without first obtaining that Lender's consent) in any legal or
arbitration proceedings relating to any Finance Document.
11.1.8 RESPONSIBILITY FOR DOCUMENTATION
Neither the Agent and Security Trustee nor the Arranger:
(a) is responsible for the adequacy, accuracy and/or completeness of any
information (whether oral or written) supplied by the Agent and Security
Trustee, the Arranger, the Borrower or any other person given in or in
connection with any Finance Document; or
(b) is responsible for the legality, validity, effectiveness, adequacy or
enforceability of any Finance Document or any other agreement, arrangement
or document entered into, made or executed in anticipation of or in
connection with any Finance Document.
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(c) is responsible for the validity, effectiveness, adequacy and completeness
of the representations and warranties made by the Borrower and Sterlite.
11.1.9 EXCLUSION OF LIABILITY
(a) Without limiting paragraph (b) below, the Agent and Security Trustee will
not be liable for any action taken by it or omitting to take action under
or in connection with any Finance Document, unless directly caused by its
gross negligence or wilful misconduct.
(b) No Party (other than the Agent and Security Trustee) may take any
proceedings against any officer, employee or agent of the Agent and
Security Trustee in respect of any claim it might have against the Agent
and Security Trustee or in respect of any act or omission of any kind by
that officer, employee or agent in relation to any Finance Document and any
officer, employee or agent of the Agent and Security Trustee may rely on
this Clause unless caused by their gross negligence or wilful default.
(c) The Agent and Security Trustee will not be liable for any delay (or any
related consequences) in crediting an account with an amount required under
the Finance Documents to be paid by the Agent and Security Trustee if the
Agent and Security Trustee has taken all necessary steps as soon as
reasonably practicable to comply with the regulations or operating
procedures of any recognised clearing or settlement system used by the
Agent and Security Trustee for that purpose.
11.1.10 LENDERS' INDEMNITY TO THE AGENT AND SECURITY TRUSTEE
Each Lender shall (in proportion to its share of the Total Commitments or, if
the Total Commitments are then zero, to its share of the Total Commitments
immediately prior to their reduction to zero) indemnify the Agent and Security
Trustee, within seven Business Days of demand, against any cost, loss or
liability incurred by the Agent and Security Trustee (otherwise than by reason
of the Agent and Security Trustee's gross negligence or wilful misconduct) in
acting as Agent and Security Trustee under the Finance Documents (unless if the
Agent and Security Trustee fails to be reimbursed by the Borrower pursuant to a
Finance Document).
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11.1.11 RESIGNATION OF THE AGENT AND SECURITY TRUSTEE
(a) The Agent and Security Trustee may resign and appoint one of its Affiliates
acting through an office in Mumbai as successor by giving notice to the
other Finance Parties and the Borrower.
(b) Alternatively the Agent and Security Trustee may resign by giving notice to
the other Finance Parties and the Borrower, in which case the Majority
Lenders (after consultation with the Borrower) may appoint a successor
Agent and Security Trustee.
(c) If the Majority Lenders have not appointed a successor Agent and Security
Trustee in accordance with paragraph (b) above within 30 days after notice
of resignation was given, the Agent and Security Trustee (after
consultation with the Borrower) may appoint a successor Agent and Security
Trustee [(acting through an office in Mumbai
(d) The retiring Agent and Security Trustee shall make available to the
successor Agent and Security Trustee such documents and records and provide
such assistance as the successor Agent and Security Trustee may reasonably
request for the purposes of performing its functions as Agent and Security
Trustee under the Finance Documents.
(e) The Agent and Security Trustee's resignation notice shall only take effect
upon the appointment of a successor.
(f) Upon the appointment of a successor, the retiring Agent and Security
Trustee shall be discharged from any further obligation in respect of the
Finance Documents but shall remain entitled to the benefit of this Clause
11.1.11. Its successor and each of the other Parties shall have the same
rights and obligations amongst themselves as they would have had if such
successor had been an original Party.
(g) After consultation with the Borrower, the Majority Lenders may, by notice
to the Agent and Security Trustee, require it to resign in accordance with
paragraph (b) above. In this event, the Agent and Security Trustee shall
resign in accordance with paragraph (b) above.
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11.1.12 CONFIDENTIALITY
(a) In acting as agent for the Finance Parties, the Agent and Security Trustee
shall be regarded as acting through its agency division which shall be
treated as a separate entity from any other of its divisions or
departments.
(b) If information is received by another division or department of the Agent
and Security Trustee, it may be treated as confidential to that division or
department and the Agent and Security Trustee shall not be deemed to have
notice of it.
11.1.13 RELATIONSHIP WITH THE LENDERS
The Agent and Security Trustee may treat each Lender as a Lender, entitled to
payments under this Agreement and acting through its Facility Office unless it
has received not less than five Business Days prior notice from that Lender to
the contrary in accordance with the terms of this Agreement.
11.1.14 CREDIT APPRAISAL BY THE LENDERS
Without affecting the responsibility of the Borrower for information supplied by
it or on its behalf in connection with any Finance Document, each Lender
confirms to the Agent and Security Trustee and the Arranger that it has been,
and will continue to be, solely responsible for making its own independent
appraisal and investigation of all risks arising under or in connection with any
Finance Document including but not limited to:
(a) the financial condition, status and nature of each Member of Sterlite
Group;
(b) the legality, validity, effectiveness, adequacy or enforceability of any
Finance Document and any other agreement, arrangement or document entered
into, made or executed in anticipation of, under or in connection with any
Finance Document;
(c) whether that Lender has recourse, and the nature and extent of that
recourse, against any Party or any of its respective assets under or in
connection with any Finance Document, the transactions contemplated by the
Finance Documents or any other agreement, arrangement or document entered
into,
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made or executed in anticipation of, under or in connection with any
Finance Document; and
(d) the adequacy, accuracy and/or completeness of the information provided by
the Agent and Security Trustee, any Party or by any other person under or
in connection with any Finance Document, the transactions contemplated by
the Finance Documents or any other agreement, arrangement or document
entered into, made or executed in anticipation of, under or in connection
with any Finance Document.
11.1.15 DEDUCTION FROM AMOUNTS PAYABLE BY THE AGENT AND SECURITY TRUSTEE
If any Party owes an amount to the Agent and Security Trustee under the Finance
Documents the Agent and Security Trustee may, after giving notice to that Party,
deduct an amount not exceeding that amount from any payment to that Party which
the Agent and Security Trustee would otherwise be obliged to make under the
Finance Documents and apply the amount deducted in or towards satisfaction of
the amount owed. For the purposes of the Finance Documents that Party shall be
regarded as having received any amount so deducted.
11.1.16 AGENT SECURITY TRUSTEE'S MANAGEMENT TIME
Any amount payable to the Agent and Security Trustee under Clause 6.6 (Costs and
expenses) and Clause 11.1.10 (Lenders' indemnity to the Agent and Security
Trustee) shall include the cost of utilising the Agent and Security Trustee's
management time or other resources and will be calculated on the basis of such
reasonable daily or hourly rates as the Agent and Security Trustee may notify to
the Borrower and the Lenders and shall be paid by the Borrower to the Agent and
Security Trustee forthwith on demand of the Agent and Security Trustee.
11.2 CONDUCT OF BUSINESS BY THE FINANCE PARTIES
No provision of this Agreement will:
(a) interfere with the right of any Finance Party to arrange its affairs (tax
or otherwise) in whatever manner it thinks fit;
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(b) oblige any Finance Party to investigate or claim any credit, relief,
remission or repayment available to it or the extent, order and manner of
any claim; or
(c) oblige any Finance Party to disclose any information relating to its
affairs (tax or otherwise) or any computations in respect of Tax.
11.3 SHARING AMONG THE FINANCE PARTIES
11.3.1 PAYMENTS TO FINANCE PARTIES
If a Finance Party (a "RECOVERING FINANCE PARTY") receives or recovers any
amount from the Borrower other than in accordance with Clause 12.1 (Payment
Mechanics) and applies that amount to a payment due under the Finance Documents
then:
(a) the Recovering Finance Party shall, within three Business Days, notify
details of the receipt or recovery, to the Agent and Security Trustee;
(b) the Agent and Security Trustee shall determine whether the receipt or
recovery is in excess of the amount the Recovering Finance Party would have
been paid had the receipt or recovery been received or made by the Agent
and Security Trustee and distributed in accordance with Clause 12.1
(Payment mechanics), without taking account of any Tax which would be
imposed on the Agent and Security Trustee in relation to the receipt,
recovery or distribution; and
(c) the Recovering Finance Party shall, within three Business Days of demand by
the Agent and Security Trustee, pay to the Agent and Security Trustee an
amount (the "SHARING PAYMENT") equal to such receipt or recovery less any
amount which the Agent and Security Trustee determines may be retained by
the Recovering Finance Party as its share of any payment to be made, in
accordance with Clause 12.1.5 (Partial payments).
11.3.2 REDISTRIBUTION OF PAYMENTS
The Agent and Security Trustee shall treat the Sharing Payment as if it had been
paid by the Borrower and distribute it between the Finance Parties (other than
the Recovering Finance Party) in accordance with Clause 12.1.5 (Partial
payments).
53
11.3.3 RECOVERING FINANCE PARTY'S RIGHTS
(a) On a distribution by the Agent and Security Trustee under Clause 11.3.2
(Redistribution of payments), the Recovering Finance Party will be
subrogated to the rights of the Finance Parties which have shared in the
redistribution.
(b) If and to the extent that the Recovering Finance Party is not able to rely
on its rights under paragraph (a) above, the Borrower shall be liable to
the Recovering Finance Party for a debt equal to the Sharing Payment which
is immediately due and payable.
11.3.4 REVERSAL OF REDISTRIBUTION
If any part of the Sharing Payment received or recovered by a Recovering Finance
Party becomes repayable and is repaid by that Recovering Finance Party, then:
(a) each Finance Party which has received a share of the relevant Sharing
Payment pursuant to Clause 11.3.2 (Redistribution of payments) shall, upon
request of the Agent and Security Trustee, pay to the Agent and Security
Trustee for account of that Recovering Finance Party an amount equal to the
appropriate part of its share of the Sharing Payment (together with an
amount as is necessary to reimburse that Recovering Finance Party for its
proportion of any interest on the Sharing Payment which that Recovering
Finance Party is required to pay); and
(b) that Recovering Finance Party's rights of subrogation in respect of any
reimbursement shall be cancelled and the Borrower will be liable to the
reimbursing Finance Party for the amount so reimbursed
11.3.5 EXCEPTIONS
(a) This Clause 11.3.5 shall not apply to the extent that the Recovering
Finance Party would not, after making any payment pursuant to this Clause,
have a valid and enforceable claim against the Borrower
(b) A Recovering Finance Party is not obliged to share with any other Finance
Party any amount which the Recovering Finance Party has received or
recovered as a result of taking legal or arbitration proceedings, if:
54
(i) it notified that other Finance Party of the legal or arbitration
proceedings; and
(ii) that other Finance Party had an opportunity to participate in those
legal or arbitration proceedings but did not do so as soon as
reasonably practicable having received notice and did not take
separate legal or arbitration proceedings.
11.3.6 CHANGE OF FACILITY OFFICE
A Finance Party shall be entitled to change its Lending Office or any other
office, through which it will be carrying out the purpose of this Agreement and
shall upon such change of office advise the Borrower and other parties about the
change of the office.
CLAUSE 12
ADMINISTRATION
12.1 PAYMENT MECHANICS
12.1.1 PAYMENTS TO THE AGENT AND SECURITY TRUSTEE
(a) On each date on which the Borrower or a Lender is required to make a
payment under a Finance Document, the Borrower or Lender shall make the
same available to the Agent and Security Trustee (unless a contrary
indication appears in a Finance Document) for value on the due date at the
time and in such funds specified by the Agent and Security Trustee as being
customary at the time for settlement of transactions in the relevant
currency in the place of payment.
(b) Payment shall be made to such account in the city of Mumbai with such bank
as the Agent and Security Trustee specifies.
55
12.1.2 DISTRIBUTIONS BY THE AGENT AND SECURITY TRUSTEE
Each payment received by the Agent and Security Trustee under the Finance
Documents for another Party shall, subject to Clause 12.1.3 (Distributions to
the Borrower) and Clause 12.1.4 (Clawback) be made available by the Agent and
Security Trustee as soon as practicable after receipt to the Party entitled to
receive payment in accordance with this Agreement (in the case of a Lender, for
the account of its Facility Office), to such account as that Party may notify to
the Agent and Security Trustee by not less than five Business Days' notice with
a bank in the city of Mumbai.
12.1.3 DISTRIBUTIONS TO THE BORROWER
The Agent and Security Trustee may (with the consent of the Borrower or in
accordance with Clause 12.2 (Set-off)) apply any amount received by it for the
Borrower in or towards payment (on the date and in the currency and funds of
receipt) of any amount due from the Borrower under the Finance Documents or in
or towards purchase of any amount of any currency to be so applied.
12.1.4 CLAWBACK
(a) Where a sum is to be paid to the Agent and Security Trustee under the
Finance Documents for another Party, the Agent and Security Trustee is not
obliged to pay that sum to that other Party (or to enter into or perform
any related exchange contract) until it has been able to establish to its
satisfaction that it has actually received that sum.
(b) If the Agent and Security Trustee pays an amount to another Party and it
proves to be the case that the Agent and Security Trustee had not actually
received that amount, then the Party to whom that amount (or the proceeds
of any related exchange contract) was paid by the Agent and Security
Trustee shall on demand refund the same to the Agent and Security Trustee
together with interest on that amount from the date of payment to the date
of receipt by the Agent and Security Trustee, calculated by the Agent and
Security Trustee to reflect its cost of funds.
56
12.1.5 PARTIAL PAYMENTS
(a) If the Agent and Security Trustee receives a payment that is insufficient
to discharge all the amounts then due and payable by the Borrower under the
Finance Documents, the Agent and Security Trustee shall apply that payment
towards the obligations of the Borrower under the Finance Documents in the
following order:
(i) FIRST, in or towards payment pro rata of any unpaid fees of the Agent
and Security Trustee under the Finance Documents;
(ii) SECONDLY, in or towards payment pro rata of any accrued interest, fee
(other than as provided in (i) above) or commission due but unpaid
under this Agreement;
(iii) THIRDLY, in or towards payment pro rata of any principal due but
unpaid under this Agreement; and
(iv) FOURTHLY, in or towards payment pro rata of any other sum due but
unpaid under the Finance Documents.
(b) The Agent and Security Trustee shall, if so directed by the Majority
Lenders, vary the order set out in paragraphs (a)(ii) to (iv) above.
(c) Paragraphs (a) and (b) above will override any appropriation made by the
Borrower.
12.1.6 NO SET-OFF BY THE BORROWER
All payments to be made by the Borrower under the Finance Documents shall be
calculated and be made without (and free and clear of any deduction for) set-off
or counter claim.
12.1.7 BUSINESS DAYS
(a) Any payment which is due to be made on a day that is not a Business Day
shall be made on the next Business Day in the same calendar month (if there
is one) or the preceding Business Day (if there is none).
57
(b) During any extension of the due date for payment of any principal or Unpaid
Sum under this Agreement interest is payable on the principal or Unpaid Sum
at the rate payable on the original due date.
12.2 SET-OFF
A Finance Party may under notification to the Agent and Security Trustee set off
any matured obligation due from the Borrower under the Finance Documents (to the
extent beneficially owned by that Finance Party) against any matured obligation
owed by that Finance Party to the Borrower, regardless of the place of payment,
booking.
12.3 NOTICES
12.3.1 COMMUNICATIONS IN WRITING
Any communication to be made under or in connection with the Finance Documents
shall be made in writing and, unless otherwise stated, may be made by fax,
letter or telex.
12.3.2 ADDRESSES
The address, fax number and telex number (and the department or officer, if any,
for whose attention the communication is to be made) of each Party for any
communication or document to be made or delivered under or in connection with
the Finance Documents is:
(a) in the case of the Borrower, that identified with its name below;
(b) in the case of each Lender, that notified in writing to the Agent and
Security Trustee on or prior to the date on which it becomes a Party; and
(c) in the case of the Agent and Security Trustee, that identified with its
name below,
or any substitute address, fax number, telex number or department or officer as
the Party may notify to the Agent and Security Trustee (or the Agent and
Security Trustee may notify to the other Parties, if a change is made by the
Agent and Security Trustee) by not less than five Business Days' notice.
58
12.3.3 DELIVERY
(a) Any communication or document made or delivered by one person to another
under or in connection with the Finance Documents will only be effective:
(i) if by way of fax, when received in legible form; or
(ii) if by way of letter, when it has been left at the relevant address or
[five] Business Days after being deposited in the post, postage
prepaid in an envelope addressed to it at that address; or
(iii) if by way of telex, when despatched, but only if, at the time of
transmission, the correct answerback appears at the start and at the
end of the sender's copy of the notice;
and, if a particular department or officer is specified as part of its
address details provided under Clause 12.3.2 (Addresses), if addressed to
that department or officer.
(b) Any communication or document to be made or delivered to the Agent and
Security Trustee will be effective only when actually received by the Agent
and Security Trustee and then only if it is expressly marked for the
attention of the department or officer identified with the Agent and
Security Trustee's signature below (or any substitute department or officer
as the Agent and Security Trustee shall specify for this purpose).
(c) All notices from or to the Borrower shall be sent through the Agent and
Security Trustee.
(d) Any communication or document made or delivered to the Borrower in
accordance with this Clause will be deemed to have been made or delivered
to the Borrower.
(e) Electronic communication.
(f) Any communication to be made between the Agent and Security Trustee and a
Lender under or in connection with the Finance Documents may be made by
electronic mail or other electronic means, if the Agent and Security
Trustee and the relevant Lender:
59
(i) agree that, unless and until notified to the contrary, this is to be
an accepted form of communication;
(ii) notify each other in writing of their electronic mail address and/or
any other information required to enable the sending and receipt of
information by that means; and
(iii) notify each other of any change to their address or any other such
information supplied by them.
(g) Any electronic communication made between the Agent and Security Trustee
and a Lender will be effective only when actually received in readable form
and in the case of any electronic communication made by a Lender to the
Agent and Security Trustee only if it is addressed in such a manner as the
Agent and Security Trustee shall specify for this purpose.
12.3.4 ENGLISH LANGUAGE
(a) Any notice given under or in connection with any Finance Document must be
in English.
(b) All other documents provided under or in connection with any Finance
Document must be:
(i) in English; or
(ii) if not in English, and if so required by the Agent and Security
Trustee, accompanied by a certified English translation and, in this
case, the English translation will prevail unless the document is a
constitutional, statutory or other official document.
12.4 CALCULATIONS AND CERTIFICATES
12.4.1 ACCOUNTS
In any litigation or arbitration proceedings arising out of or in connection
with a Finance Document, the entries made in the accounts maintained by a
Finance Party shall be prima facie evidence of the matters to which they relate.
60
12.4.2 CERTIFICATES AND DETERMINATIONS
Any certification or determination by a Finance Party of a rate or amount under
any Finance Document is, in the absence of manifest error, conclusive evidence
of the matters to which it relates.
12.4.3 DAY COUNT CONVENTION
Any interest, commission or fee accruing under a Finance Document will accrue
from day to day and is calculated on the basis of the actual number of days
elapsed and a year of 365 days or, in any case where the practice in the
Relevant Interbank Market differs, in accordance with that market practice.
12.4.4 PARTIAL INVALIDITY
If, at any time, any provision of the Finance Documents is or becomes illegal,
invalid or unenforceable in any respect under any law of any jurisdiction,
neither the legality, validity or enforceability of the remaining provisions nor
the legality, validity or enforceability of such provision under the law of any
other jurisdiction will in any way be affected or impaired.
12.4.5 REMEDIES AND WAIVERS
No failure to exercise, nor any delay in exercising, on the part of any Finance
Party, any right or remedy under the Finance Documents shall operate as a
waiver, nor shall any single or partial exercise of any right or remedy prevent
any further or other exercise or the exercise of any other right or remedy. The
rights and remedies provided in this Agreement are cumulative and not exclusive
of any rights or remedies provided by law.
12.5 AMENDMENTS AND WAIVERS
12.5.1 REQUIRED CONSENTS
(a) Subject to Clause 12.5.2 (Exceptions) any term of the Finance Documents may
be amended or waived only with the written consent of the Majority Lenders
and the Borrower and any such amendment or waiver will be binding on all
Parties.
(b) The Agent and Security Trustee may effect, on behalf of any Finance Party,
any amendment or waiver permitted by this Clause.
61
12.5.2 EXCEPTIONS
(a) An amendment or waiver that has the effect of changing or which relates to:
(i) an extension to the date of payment of any amount under the Finance
Documents;
(ii) an increase in or an extension of any Commitment;
(iii) any provision which expressly requires the consent of all the
Lenders; or
(iv) Clause 2.2 (Finance Parties rights and obligations), Clause 10
(Changes to the Lenders) or this Clause 12.5.2; and
(v) Definition of "Majority Lenders"
shall not be made without the prior written consent of all the Lenders.
(b) An amendment or waiver which relates to the rights or obligations of the
Agent and Security Trustee or the Arranger may not be effected without the
consent of the Agent and Security Trustee or the Arranger.
12.6 COUNTERPARTS
Each Finance Document may be executed in any number of counterparts, and this
has the same effect as if the signatures on the counterparts were on a single
copy of the Finance Document.
12.7 JURISDICTION
This Agreement shall be governed by and construed in accordance with the laws of
India. This Agreement has been signed by all the parties in Mumbai and the
Facility is to be disbursed in Mumbai and payment of all amounts for repayment
of the Loan, payment of interest, fees, costs, charges and expenses and all
other amounts are also to be made in Mumbai. The Debt Recovery Tribunal in
Mumbai shall therefore have exclusive jurisdiction for any claim of the Lenders
on the Borrower.
62
SCHEDULE - 1
THE ORIGINAL PARTIES COMMITMENTS
AND REPAYMENT INSTALMENTS
PART I
THE BORROWER
Name of the Borrower
BHARAT ALUMINIUM COMPANY LIMITED
PART II A
COMMITMENT A
Name of Original Lender Commitment
----------------------- ----------
1. Union Bank of India Rupees one hundered fifty crores
2. Export Import Bank of India Rupees seventy five crores
PART II B
COMMITMENT B
Name of Original Lender Commitment
----------------------- ----------
1. Uco Bank Rupees one hundred crores
2. State Bank of Travancore Rupees one hundred crores
3. Export Import Bank of India Rupees seventy five crores
4. State Bank of Saurashtra Rupees fifty crores
5. State Bank of Hyderabad Rupees fifty crores
6. State Bank of Patiala Rupees fifty crores
7. State Bank of Indore Rupees fifty crores
63
SCHEDULE - 2
CONDITIONS PRECEDENT TO DRAWDOWN
1. THE BORROWER
(a) A copy certified by an Authorised Signatory as true copy of the original
each of the constitutional documents of the Borrower.
(b) A copy certified as true copy of the original resolution of the board of
directors of the Borrower:
(i) approving the terms of, and the transactions contemplated by, the
Finance Documents to which it is a party and resolving that it execute
the Finance Documents to which it is a party;
(ii) authorising a specified person or persons to execute the Finance
Documents to which it is a party on its behalf; and
(iii) authorising a specified person or persons, on its behalf, to sign
and/or despatch all documents and notices (including, if relevant, any
Drawdown Request) to be signed and/or despatched by it under or in
connection with the Finance Documents to which it is a party.
(c) A specimen of the signature of each person authorised by the resolution
referred to in paragraph (b) above.
(d) A certificate of the Borrower (signed by a director) confirming that
borrowing of the Total Commitments would not cause any borrowing, limit
binding on the Borrower to be exceeded.
(e) A certificate of an authorised signatory of the Borrower certifying that
each copy document relating to it specified in this Schedule 2 is correct,
complete and in full force and effect as at a date no earlier than the date
of this Agreement.
(f) A copy certified as true copy of the original of each of the resolutions
passed in the general meeting(s) of the Borrower authorising the directors
of the Borrower to borrow in excess of the paid up capital and free
reserves of the Company upto the
64
limit specified therein and to mortgage and charge the Properties of the
Borrower as security for the payment of the Loan Amounts.
2. LEGAL OPINION
(a) A legal opinion from legal advisors to the Arranger and the Agent, and
Security Trustee substantially in the form distributed to the Original
Lenders regarding the validity and enforceability of the Facility Agreement
under the laws of India.
(b) A legal opinion from the legal advisors to the Borrower in the form by the
Agent and Security Trustee provided to the Borrower.
3. OTHER DOCUMENTS AND EVIDENCE
(a) A copy certified as true copy by an Authorised Signatory of the Borrower of
any other Authorisation or other document, opinion or assurance which the
Agent and Security Trustee considers to be necessary or desirable (if it
has notified the Borrower accordingly) in connection with the entry into
and performance of the transactions contemplated by any Finance Document or
for the validity and enforceability of any Finance Document.
(b) The Original Financial Statements of the Borrower.
(c) Evidence that the fees, costs and expenses then due from the Borrower
pursuant to Clause 6.6 (Costs and expenses) have been paid or will be paid
by the first Drawdown Date.
(d) the Borrower shall provide the Lenders a detailed project update report on
the viability of the project.
65
SCHEDULE-3
REQUESTS
DRAWDOWN REQUEST
From: [Borrower]
To: [Agent and Security Trustee]
Dated: ______________________________
Dear Sirs
[BORROWER] - [_____] RUPEE TERM FACILITIES AGREEMENT
DATED [_____] (THE "FACILITIES AGREEMENT")
1. We refer to the Facilities Agreement. This is a Drawdown Request. Terms
defined in the Facilities Agreement shall have the same meaning in this
Drawdown Request.
2. We wish to avail of a Facility A/B on the following terms:
Proposed Drawdown Date: [_____] (or, if that is not a Business Day, the
next Business Day)
Amount: [_____] or, if less, the Available Commitment
3. We confirm that each condition specified in Clause 2.4.2 (Further
conditions precedent) is satisfied on the date of this Drawdown Request.
4. The proceeds of this Facility A/B should be credited to the account of the
Borrower bearing No. ___________ with ___________ (Bank's Name).
5. This Drawdown Request is irrevocable.
Yours faithfully
----------------------------------------
authorised signatory for
[name of Borrower]
66
SCHEDULE 4
FORM OF TRANSFER CERTIFICATE
To: [_____] as Agent and Security Trustee
From: [The Existing Lender] (the "EXISTING LENDER") and [The New Lender] (the
"NEW LENDER")
Dated: _________________
[BORROWER] - [_____] RUPEE TERM FACILITIES AGREEMENT
DATED [_____] (THE "FACILITIES AGREEMENT")
1. We refer to the Facilities Agreement. This is a Transfer Certificate. Terms
used in the Facility Agreement shall have the same meaning in this Transfer
Certificate.
2. We refer to Clause 10.1.3(ii) (Procedure for transfer):
(a) The Existing Lender and the New Lender agree to the Existing Lender
transferring to the New Lender by novation all or part of the Existing
Lender's Commitment, rights and obligations referred to in the
Schedule in accordance with Clause 10.1.3(ii) (Procedure for
transfer).
(b) The proposed Transfer Date is [_____].
(c) The Facility Office and address, fax number and attention details for
notices of the New Lender for the purposes of Clause 12.3.2
(Addresses) are set out in the Schedule.
3. The New Lender expressly acknowledges the limitations on the Existing
Lender's obligations set out in paragraph (c) of Clause 10.1.2 (Limitation
of responsibility of Existing Lenders).
4. This Transfer Certificate may be executed in any number of counterparts and
this has the same effect as if the signatures on the counterparts were on a
single copy of this Transfer Certificate.
67
SCHEDULE 4 (CONTD.)
COMMITMENT/RIGHTS AND OBLIGATIONS TO BE TRANSFERRED
TRANSFER DETAILS:
Nature: [insert description of Facility(ies) transferred]
Final Maturity: [_____]
PARTICIPATION TRANSFERRED
Commitment Transferred
Drawn Amount: [_____]
Undrawn Amount: [_____]
ADMINISTRATION DETAILS:
New Lender's Receiving Account: [_____]
Process Agent: [_____]
Address: [_____]
Telephone: [_____]
Facsimile: [_____]
Telex: [_____]
Attn/Ref: [_____]
[Existing Lender] [New Lender]
By: By:
--------------------------------- ------------------------------------
This Transfer Certificate is accepted by the Agent and Security Trustee and the
Transfer Date is confirmed as [_____].
[Agent and Security Trustee]
By:
---------------------------------
68
SCHEDULE 5
Form of Compliance Certificate
To: [_____] as Agent and Security Trustee
From: [Borrower]
Dated: ______________________________
Dear Sirs
[BORROWER] - [_____] RUPEE TERM FACILITIES AGREEMENT
DATED [_____] (THE "FACILITIES AGREEMENT")
1. We refer to the Facilities Agreement. This is a Compliance Certificate.
Terms used in the Facilities Agreement shall have the same meaning in this
Compliance Certificate.
2. We confirm that: [Insert details of covenants to be certified including
calculations]
3. [We confirm that no Default is continuing.] *
Signed:
----------------------------- --------------------------------
Director Of Director Of
[Borrower] [Borrower]
[insert applicable certification language]**
-------------------------------------
for and on behalf of
[name of auditors of the Borrower]***
* If this statement cannot be made, the certificate should identify any
Default that is continuing and the steps, if any, being taken to remedy it.
** To be agreed with the Borrower's auditors and the Lenders prior to signing
the Agreement.
*** Only applicable if the Compliance Certificate accompanies the audited
financial statements and is to be signed by the auditors. To be agreed with
the Borrower's auditors prior to signing the Agreement.
69
SCHEDULE 6
BRIEF DESCRIPTION OF ASSETS
PART -I
BRIEF DESCRIPTION OF THE IMMOVABLE PROPERTIES
(A) All pieces and parcels of lands as mentioned hereinbelow:
Brief description of Free Hold Lands as mentioned hereinbelow
Date of
Sr. No. acquisition Survey No/PC NO. Village Area (Acres)
------- ------------- ---------------- --------- ------------
1. 11.06.74 24 Chotipani 3.07
2. 21.06.74 21 Rumgara 3.62
3. 12.10.74 20 Tanakhar 15.04
4. 12.04.74 21 Risda 253.02
5. 05.12.73 20 Rogbahari 88.67
6. November 1973 21 Rumgara 16.87
7. 05.12.73 20 Padhimar 184.74
8. November 1973 21 Risda 145.37
9. 12.10.1973 21 Kohadia 176.42
10. 16.11.76 4A21 Rogbahari 33.28
11. 16.11.76 5A 21 Rogbahari 3.55
12. 24.09.90 Rogbahari 20.7
------
944.65
======
70
(B) Description of Lease Hold Lands
Sr. No. Date of grant Place Areas (Acres)
------- ------------- ----- -------------
1. 29.03.72 Korba 1136
(C) Brief Description of Mining Leases
Date of Area in
Sr. NO. mining lease hectares Village
------- ------------ -------- ---------------------
1. 21.3.1997 626.117 Rajandgaon (Kaverdha)
2. 9.07.92 639.169 Surguja (Maispat)
(D) Brief Description of Flats and Offices
LOCATION
SR. NO. FLAT NO./ADDRESS (PLACE)
------- ---------------- ---------
1 66, Jolly Maker Xxxxxxxx XX, Xxxx Xx. 000, Xxxxxx
Backbay Reclamation, Nariman Point, Mumbai
400 020
2. 67, Jolly Maker Xxxxxxxx XX, Xxxx Xx. 000, Xxxxxx
Backbay Reclamation, Nariman Point, Mumbai
400
3. 000/000, 0xx xxx 0xx Xxxxx, Xxxxxx Xxx. Xxx Xxxxxx
Prabhadevi Road, Lower Parel
4. Garage No. X-0, Xxxxxx Xxx. Xxx Xxxxxxxxxx Xxxxxx
Xxxx, Xxxxx Xxxxx
0. Xx. 000& 000, 0xx xxxxx, Xxxxx Xxxx Apt Mumbai
Plot No. CTS 240, Mogra Village, Andheri
6. A 4 to X 0, Xx 00 X Xxxxxxxxxxx Xxxx Xxxxxxx
0. A 000, Xxx Xxxxxxx Xxxxxx Xxx Xxxxx
8. Crescent Court Xx. 000, Xxxxxxxxxxx Xxxx Xxxxxx
Xxxxx, Xxxxxxx
71
with buildings, factories and other structures standing thereon, godowns, water
tanks together with fixed plant, machinery, fixtures and fittings,
air-conditioning and cooling equipment, civil constructions,hoists, lifts and
any thing permanently attached to the earth, or permanently fastened or embedded
in anything attached to the earth
PART II
BRIEF DESCRIPTION OF OTHER PROPERTIES
All the movable properties, both present and future, tangible or intangible
excluding, however, Current Assets, but including such as but not limited to
plant and machinery equipment, tools, accessories, uncalled capital, goodwill,
trade xxxx, software, patents copy rights including any other intellectual
property such as confidential information, control systems, office furniture,
type writers, computers, computer systems including computer software, drilling
machines, dyes, ropes and whether installed or not, and lying loose or in cases
or being in or upon or about the Borrower's premises and godowns or wherever
else the same may be or be held by any party anywhere to the order or
disposition of the Borrower or in the course of transit or delivery howsoever or
wheresoever and whether in actual possession of the Borrower or in possession of
any other person for and on behalf of the company and all other assets (not
being current assets) investments, including either by way of substitution,
addition or replacement thereof.
72
SCHEDULE 7
Description of Existing Secured Indebtedness
Outstanding Amount
of Indebtedness (Rs Date of security
SI. NO. Name of Creditor Crs) Nature of Security Document
------- ------------------------------ ------------------- --------------------- -----------------
1 Bank of India 25
2 Allahahad Bank 10
3 Corporation Bank 50
4 HDFC 50
5 Oriental Bank of Commerce 100
6 State Bank of Bikaner & Jaipur 50
7 State Bank of Hyderabad 50
8 State Bank of Indore 50
9 State Bank of Mysore 50 Hypothecation on
Movable Property and 16-Oct-03
10 State Bank of Patiala 50 Mortgage over the
Immovable Property
11 State Bank of Saurashtra 50
12 Syndicate Bank 100
13 The Federal Bank Ltd 50
14 The Jammu & Kashmir Bank Ltd 100
15 The Kartnataka Bank Ltd 50
16 The Karur Vysya Bank Ltd 50
17 The Xxxxx Xxxxx Bak Ltd 15
18 Uco Bank 50
19 Vijaya Bank 50
Total 1000
73
IN WITNESS WHEREOF the Parties have caused this Agreement to be executed on
their behalf respectively on the Day and Year first hereinabove mentioned and in
the manner hereinafter provided:
BORROWER
The Common Seal of BHARAT ALUMINIUM
COMPANY LIMITED has been hereunto
affixed by Mr. T.L Palehi Kumar /s/ T.L. Palehi Kumar
----------------------------------------
withinnamed, who have been duly
authorised for the purpose pursuant
to a resolution passed at a meeting
of its committee of directors held on
the ___ day of ___________ 2004 and
who have accordingly signed these
presents in token of the common seal
having been affixed
ARRANGER
Signed and delivered for and on
behalf of the Arranger, withinnamed,
namely
ABN AMRO SECURITIES (INDIA) PRIVATE
LIMITED by the hand of
Mr. (SIGNED)
--------------------------------- ----------------------------------------
Mr. (SIGNED)
--------------------------------- ----------------------------------------
ITS AUTHORISED SIGNATORY
AGENT AND SECURITY TRUSTEE
Signed and delivered for and on
behalf of the Agent and Security
Trustee, withinnamed, namely
IL&FS TRUST COMPANY LIMITED
by the hand of
MS XXXXXX XXXXXXXX /s/ Xxxxxx Xxxxxxxx
----------------------------------------
ITS AUTHORISED SIGNATORY
74
LENDERS
Signed And Delivered For And On
Behalf Of The Lenders, Withinnamed,
Namely
1. UNION BANK OF INDIA
By Hand Of
Mr T L V Xxx and Xxxx Xxxxxxx /s/ T L V Xxx
----------------------------------------
ITS AUTHORISED SIGNATORY
/s/ Xxxx Xxxxxxx
----------------------------------------
2. EXPORT IMPORT BANK OF INDIA
By Hand Of
Mr Xxxxxxx Xxxxxxxxxxxx /s/ Xxxxx Xxxxxxxxxxxx
----------------------------------------
ITS AUTHORISED SIGNATORY
3. UCO BANK
By Hand Of
Xx X.X. Xxxxxxxx & A. Roychourdhauy /s/ X.X. Xxxxxxxx
----------------------------------------
ITS AUTHORISED SIGNATORY
/s/ A. Roychourdhauy
----------------------------------------
4. STATE BANK OF TRAVANCORE
By Hand Of
Xx X.X. Xxxxx /s/ S.K. Birla
----------------------------------------
ITS AUTHORISED SIGNATORY
5. STATE BANK OF SAURASHTRA
By Hand Of
Xx X.X. Xxxxxxxxx & X.X. Xxxxxx /s/ X.X. Xxxxxxxxx
----------------------------------------
ITS AUTHORISED SIGNATORY
/s/ X.X. Xxxxxx
----------------------------------------
6. STATE BANK OF HYDERABAD
By Hand Of
Mr K. Rapech Babu /s/ K. Rapech Babu
----------------------------------------
ITS AUTHORISED SIGNATORY
75
7. STATE BANK OF PATIALA
By Hand Of
Mr (SIGNED)
---------------------------------- -------------------------------
ITS AUTHORISED SIGNATORY
8. STATE BANK OF INDORE
By Hand Of
Mr (SIGNED)
---------------------------------- -------------------------------
ITS AUTHORISED SIGNATORY
76
DATED THIS 18TH DAY OF AUGUST 2004
BHARAT ALUMINIUM COMPANY LIMITED
... BORROWER
ABN AMRO SECURITIES (INDIA) PRIVATE
LIMITED
... MANDATED ARRANGER
AND
UNION BANK OF INDIA
AND
EXPORT IMPORT BANK OF INDIA
... JOINT LEAD MANAGERS
IL&FS TRUST COMPANY LIMITED
.... AGENT AND SECURITY TRUSTEE
AND
THE BANKS AND FINANCIAL INSTITUTIONS
... ORIGINAL LENDERS
RUPEE TERM FACILITIES AGREEMENT
XXXX & GIRISH & CO.,
ADVOCATES
1ST FLOOR, SETHNA BUILDING
55 XXXXXXXX XXXXX ROAD,
MARINE LINES,
MUMBAI - 400 002
77
