Exhibit 10.2 - Agreements for (POUND)550 million
Credit Facility, each dated July 22, 1998, for
Yorkshire Power Group Limited,
among
Yorkshire Power Group Limited
and the banks' names therein.
THIS AGREEMENT is dated 22nd July, 1998 between:-
(1) YORKSHIRE POWER GROUP LIMITED ("YPG");
(2) YORKSHIRE HOLDINGS PLC ("YH");
(3) YORKSHIRE ELECTRICITY GROUP PLC ("YEG");
(4) CITIBANK, N.A. and DEUTSCHE BANK AG LONDON (in this
capacity the
"Arrangers");
(5) THE FINANCIAL INSTITUTIONS listed in Schedule 1 as banks
(the "Banks"); and
(6) CITIBANK INTERNATIONAL plc as agent (in this capacity the
"Agent").
IT IS AGREED as follows:-
1. INTERPRETATION
1.1 Definitions
In this Agreement:-
"Act"
means the Electricity Xxx 0000 and, unless the context otherwise
requires,
all subordinate
legislation and any successive legislation thereto.
"Adjusted Share Capital and Reserves"
means the aggregate of:
(a) the amount paid up or credited as paid up on the issued
share capital of
YPG; and
(b) the amounts standing to the credit of the consolidated
capital and
revenue reserves of
the Group,
adjusted, to the extent that the following items have not already
been added,
deducted or
excluded in arriving at the figures referred to in paragraph (a)
or (b) above:
(i) by adding Subordinated Debt and the Preferred Securities;
(ii) by deducting the amounts standing to the debit of the
consolidated
reserves of the
Group;
(iii) by deducting any amounts attributable to interests of
non-Group members
in Group
subsidiaries;
(iv) by deducting any reserves set aside for deferred
taxation;
(v) by deducting the amount by which the net book value of
any fixed asset has
been
written up after the date of this Agreement (or, in the case of a
person
becoming a
member of the Group after that date, the date on which it becomes
a member of the
Group) by way of revaluation or on its transfer from one member
of the Group to
another (but no such deduction shall be made in respect of any
amount if supported by,
and not exceeding the amount shown by, an independent written
valuation),
but so that no amount to be added, deducted or excluded as a
result of any of the above shall be
added, deducted or excluded more than once in the same
calculation.
"Affiliate"
means a Subsidiary or a holding company (as defined in Section
736 of the Companies Act
1985) of a Bank or any other Subsidiary of that holding company.
"Applicable Rate"
means the rate quoted by the Agent to a Borrower to be that at
which money can be deposited
in the London interbank market on the earliest available day,
provided that the applicable rate
shall not be less than LIBID nor more than LIBOR.
"Balance Sheet"
means, at any time, the then most recent audited consolidated
annual or unaudited consolidated
half yearly balance sheet of the Group delivered to the Agent by
YPG under Clause 16.2
(Financial information).
"Borrower"
means YPG, YH or YEG.
"Borrowings"
means indebtedness in respect of:
(a) moneys borrowed or raised including (except for the
purposes of Clause 17.5 (Cross
default)) the recourse element of any asset securitisation or
other factoring but
excluding any amounts owing for assets purchased or services
obtained on trade credit
terms in the ordinary course of business;
(b) amounts raised by means of acceptances under any
acceptance credit facility or
otherwise (not being acceptances in relation to the purchase of
assets or services in the
ordinary course of business);
(c) the deferred purchase price of assets or services the
payment of which is deferred for a
period in excess of ninety days (other than assets or services
obtained on trade credit
terms normal in the business concerned);
(d) the principal amount and any premium payable by the
relevant company from time to
time owing in respect of any loan notes, debentures, bonds or
other similar
instruments;
(e) the capital value of any financial lease, hire purchase
arrangements or any arrangement
treated as a financial lease required to be capitalised and
treated as a borrowing in the
consolidated balance sheet of the Group;
(f) for the purposes of Clause 17.5 (Cross default) (only)
net indebtedness under any
currency or interest cap, swap or collar; and
(g) any guarantee or assurance against financial loss or
indemnity in respect of the
borrowings of any other person not being a member of the Group of
a type referred to
in paragraphs (a) to (f) (inclusive) above (but excluding any
such guarantee or
assurance in respect of the performance of any contract or
service not involving
financial loss or indemnity in respect of borrowings),
but shall exclude:
(A) liabilities in respect of the Pooling and Settlement
Agreement or other arrangements
which replace the Pooling and Settlement Agreement in accordance
with Clause 17.12
(Pooling and Settlement Agreement);
(B) Project Finance Borrowings; and
(C) for the avoidance of doubt, the Preferred Securities.
"Business Day"
means a day (other than a Saturday or a Sunday) on which banks
are open for business in
London.
"Capitalisation"
means, at any time, the aggregate of Adjusted Share Capital and
Reserves and Debt.
"Commitment"
means each of the Facility A Commitment, the Facility B
Commitment and the Facility C
Commitment of a Bank.
"Commitment Period"
means the Facility A Commitment Period, the Facility B Commitment
Period or the Facility C
Commitment Period.
"Debt"
means Borrowings (excluding Subordinated Debt) less Investments.
"Default"
means an Event of Default or an event which, with the giving of
notice or lapse of time
provided for in Clause 17 (Default) (or any combination of the
foregoing), would constitute an
Event of Default.
"Director General"
means the person from time to time appointed by the Secretary of
State to hold office as
Director General of Electricity Supply for the purposes of the
Act or any office which replaces
the function of the Director General of Electricity Supply.
"Drawdown Date"
means the date of the advance of a Loan.
"EBITDA"
means, in respect of any Relevant Period, the total operating
profit for continuing operations,
acquisitions (as a component of continuing operations) and
discontinued operations of the
Group before taking into account:
(a) Interest Payable and Interest Receivable and dividends in
respect of Preferred
Securities;
(b) all amounts provided for depreciation and amortisation
(including, without limitation,
amortisation of any goodwill);
(c) all exceptional and extraordinary items; and
(d) all taxes,
in each case for that Relevant Period but after:
(A) deducting any gain over book value arising in favour of
the Group on the sale, lease or
other disposal of any asset (other than on the sale of trading
stock) during the Relevant
Period and any gain arising on revaluation of any asset during
that Relevant Period, in
each case to the extent that it would otherwise be taken into
account, whether as an
exceptional item or otherwise; and
(B) excluding the earnings or profit before interest, tax
depreciation and amortisation (as
determined in accordance with the preceding paragraphs of this
definition) and
excluding all exceptional and extraordinary items of any company
referred to in
paragraph (a) of the definition of Project Finance Borrowings,
(all calculated on a consolidated basis disregarding any portion
of any item taken into account
in that calculation which is attributable to any minority
interests in Subsidiaries).
"Environmental Law"
means any applicable law (including, without limitation, common
law), regulation, directing
code of practice, circular, guidance notice or the like
concerning pollution or the protection of
human health, the environment, the conditions of the work place
or the manufacture,
processing, generation, transportation, storage, treatment or
disposal of dangerous substances,
pollutants, contaminants, chemicals or toxic or hazardous
substances or waste.
"Environmental Licence"
means any authorisation required by any Environmental Law.
"Existing Facilities"
means:
(a) the bilateral credit facility made available to YPG under
the agreement dated 31st July,
1997 and made between YPG and Union Bank of Switzerland; and
(b) each bilateral credit facility dated 2nd May, 1995 made
available to YEG by Midland
Bank PLC, Den Danske Bank Aktieselskab, The Sumitomo Bank,
Limited, Deutsche
Bank AG London, The Bank of Tokyo-Mitsubishi, Limited, National
Westminster
Bank Plc, Union Bank of Switzerland and Xxxxxx Guaranty Trust
Company of New
York.
"Event of Default"
means an event specified as such in Clause 17.1 (Events of
Default).
"Facility"
means each of Facility A, Facility B and Facility C.
"Facility A"
means the sterling credit facility designated under Clause
2.1(a)(i) (Facilities), the terms of
which are set out in this Agreement being a revolving credit
facility up to the Facility A Term
Date which then converts on that date into a term loan facility.
"Facility A Commitment"
means:
(a) in relation to a Bank which is a Bank on the date of this
Agreement, the amount in
Sterling set opposite its name under the heading "Facility A" in
Schedule 1 and the
amount of any other Bank's Facility A Commitment acquired by it
under Clause 25
(Changes to the Parties); and
(b) in relation to a Bank which becomes a Bank after the date
of this Agreement, the
amount of any other Bank's Facility A Commitment acquired by it
under Clause 25
(Changes to the Parties),
to the extent not cancelled, transferred or reduced under this
Agreement.
"Facility A Commitment Period"
means the period from the date of this Agreement to the Facility
A Term Date (both dates
inclusive).
"Facility A Loan"
means a Loan drawn down or to be drawn down under Facility A.
"Facility A Repayment Date"
means the second anniversary of the date of this Agreement.
"Facility A Term Date"
means the date falling 364 days after the date of this Agreement.
"Facility B"
means the sterling term loan facility designated under Clause
2.1(a)(ii) (Facilities), the terms of
which are set out in this Agreement.
"Facility B Commitment"
means :
(a) in relation to a Bank which is a Bank on the date of this
Agreement, the amount in
Sterling set opposite its name under the heading "Facility B" in
Schedule 1 and the
amount of any other Bank's Facility B Commitment acquired by it
under Clause 25
(Changes to the Parties); and
(b) in relation to a Bank which becomes a Bank after the date
of this Agreement, the
amount of any other Bank's Facility B Commitment acquired by it
under Clause 25
(Changes to the Parties),
to the extent not cancelled, transferred or reduced under this
Agreement.
"Facility B Commitment Period"
means the period from the date of this Agreement to the Term Date
(both dates inclusive).
"Facility B Loan"
means a Loan drawn down or to be drawn down under Facility B.
"Facility C"
means the sterling revolving credit facility designated under
Clause 2.1(a)(iii) (Facilities), the
terms of which are set out in this Agreement.
"Facility C Commitment"
means:
(a) in relation to a Bank which is a Bank on the date of this
Agreement, the amount in
Sterling set opposite its name under the heading "Facility C" in
Schedule 1 and the
amount of any other Bank's Facility C Commitment acquired by it
under Clause 25
(Changes to the Parties); and
(b) in relation to a Bank which becomes a Bank after the date
of this Agreement, the
amount of any other Bank's Facility C Commitment acquired by it
under Clause 25
(Changes to the Parties),
to the extent not cancelled, transferred or reduced under this
Agreement.
"Facility C Commitment Period"
means the period from the date of this Agreement to the Repayment
Date (both dates inclusive).
"Facility C Loan"
means a Loan drawn down or to be drawn down under Facility C.
"Facility Office"
means the office(s) in the United Kingdom notified by a Bank to
the Agent:
(a) on or before the date it becomes a Bank; or
(b) by not less than five Business Days' notice,
as the office through which it will perform all or any of its
obligations under this Agreement.
"Fee Letter"
means a letter between the Arrangers and the Borrowers or a
letter between the Agent and the
Borrowers, in each case dated 10th June, 1998, setting out,
amongst other things, the amount
of the fees referred to in Clause 19 (Fees).
"Finance Document"
means this Agreement, any Fee Letter, any Novation Agreement, any
Novation Certificate or
any other document designated as such by the Agent and YPG.
"Finance Party"
means an Arranger, a Bank or the Agent.
"Group"
means YPG and its Subsidiaries.
"Information Memorandum"
means the Information Memorandum dated June, 1998 and prepared in
connection with this
Agreement.
"Interest Payable"
means, in respect of any Relevant Period, all interest payable
and similar charges as shown in
(or in the notes to) the financial statements of the Group
(calculated on a consolidated basis)
for the Relevant Period but excluding interest payable on Project
Finance Borrowings by
companies referred to in paragraph (a) of that definition.
"Interest Period"
means each period determined in accordance with Clause 8
(Interest Periods).
"Interest Receivable"
means, in respect of any Relevant Period, all interest receivable
and similar income as shown in
(or in the notes to) the financial statements of the Group
(calculated on a consolidated basis)
for that Relevant Period but excluding interest receivable by a
company of the type referred to
in paragraph (a) of the definition of Project Finance Borrowings.
"Investments"
means, as at any date, the aggregate (calculated on a
consolidated basis) of:
(a) cash in hand in a jurisdiction where such amounts are
freely transferable out of that
jurisdiction and convertible into currencies dealt in on the
London foreign exchange
market;
(b) money at call in a jurisdiction, and freely convertible
into currencies, referred to in (a)
above;
(c) deposits and certificates of deposit the term of which
has twelve months or less
remaining to maturity in a jurisdiction, and freely convertible
into currencies, referred
to in (a) above;
(d) United Kingdom gilts;
(e) deposits made with the Commissioners of Inland Revenue in
respect of which
certificates of tax deposit have been issued by Her Majesty's
Treasury;
(f) sterling bills of exchange eligible for rediscount at the
Bank of England;
(g) bonds rated AA- (or the equivalent) or above by Standard
& Poor's Ratings Group,
The Fitch IBCA Group or Duff & Xxxxxx Credit Rating Co. or
Xxxxx'x Investors
Service, Limited; and
(h) any other negotiable money market instrument issued by an
issuer in a jurisdiction, and
convertible into currencies, referred to in (a) above with a
maximum maturity of twelve
months or less, excluding commercial paper (unless it is rated at
least A1 (or the
equivalent) by Standard & Poor's Ratings Group or The Fitch IBCA
Group or Duff &
Xxxxxx Credit Rating Co. or P1 by Xxxxx'x Investors Service,
Limited),
provided that, when the aggregate amount of Investments required
to be taken into account for
the purposes of this definition on any particular day is being
ascertained, any such Investments
denominated or repayable or in respect of which monies are
payable in a currency other than
sterling shall be taken into account at their sterling equivalent
at the rate of exchange prevailing
on that day in London using the Agent's spot rate as of 11.00
a.m. on such date for the
purchase of such currency with sterling.
"LIBID"
means, in relation to an amount received by the Agent referred to
in Clause 22.2(b) (Other
indemnities), the arithmetic mean (rounded to four decimal
places) of the rates, as supplied to
the Agent at its request, quoted by the Reference Banks to
leading banks in the London
interbank market at or about 11.00 a.m. on the relevant day for
the taking of deposits in
sterling and in an amount approximately equal to the amount so
received from a Borrower for
the period from and including the date that payment is received
by the Agent to but excluding
the last day of the Interest Period of the relevant Loan or
amount.
"LIBOR"
means, in relation to an Interest Period:
(a) the rate appearing on the Telerate Screen page 3750 or
any equivalent successor to
such page or other page as appropriate on the Telerate Service or
(failing which) such
other service as may, from time to time, display the British
Bankers' Association
Interest Settlement Rates for deposits in sterling (as agreed
between the relevant
Borrower and the Agent (acting reasonably)) (the "Telerate
Screen"); or
(b) (if no such offered rate for quotations appears on the
Telerate Screen) the arithmetic
mean (rounded to four decimal places) of the relevant offered
rates which appear on
the relevant page of the Reuters Screen; or
(c) (in the absence of manifest error, if no such offered
rate for quotations appears on the
Telerate Screen or the Reuters Screen) the arithmetic mean
(rounded to four decimal
places) of the rates, as supplied to the Agent at its request,
quoted by the Reference
Banks to leading banks in the London interbank market,
(in each case) at 11.00 a.m. on the first day of that Interest
Period, as being the interest rate(s)
quoted in the London interbank market for the offering of
deposits in sterling for a period equal
to that Interest Period.
"Licence"
means the public electricity supply licence granted by the
Secretary of State to YEG under
Section 6(I)(c) of the Act as modified or supplemented from time
to time and, if any such
licence is split by or with the consent of the Director General
into more than one new licence,
each such new licence.
"Licence Holder"
means at any time a member of the Group which then holds a
Licence.
"Loan"
means, the principal amount of each borrowing by a Borrower under
this Agreement or the
principal amount outstanding of that borrowing.
"Majority Banks"
means, at any time, Banks:-
(a) whose participations in the Loans then outstanding
aggregate more than 662/3 per cent.
of all the Loans then outstanding; or
(b) if there are no Loans then outstanding, whose Commitments
then aggregate more than
662/3 per cent. of the Total Commitments; or
(c) if there are no Loans then outstanding and the Total
Commitments have been reduced
to nil, whose Commitments aggregated more than 662/3 per cent. of
the Total
Commitments immediately before the reduction.
"Mandatory Cost"
means the cost imputed to the Banks of compliance with the
Mandatory Liquid Assets
requirements of the Bank of England and the requirements of the
Financial Services Authority
expressed as a rate per annum and determined in accordance with
Schedule 3.
"Margin"
means:-
(a) in respect of Facility A:
(i) for the period from the date of this Agreement to (and
including) the Facility A
Term Date, 0.275 per cent. per annum; and
(ii) thereafter, 0.32 per cent. per annum; and
(b) in respect of Facility B and Facility C:
(i) if Debt is less that 65 per cent. of Capitalisation, 0.3
per cent. per annum; and
(ii) otherwise, 0.325 per cent. per annum,
such changes in the Margin to be effected in accordance with
Clause 9.4 (Margin adjustment).
"Material Adverse Effect"
means a material adverse effect on:
(a) the ability of YPG to comply, from time to time, with its
obligations under
Clause 16.17 (Financial covenants);
(b) the ability of any Borrower to meet its payment
obligations under the Finance
Documents; or
(c) in respect of Clauses 15.5 (Non-conflict), 15.10
(Litigation), 15.11 (Licence), 16.15
(Licence), 16.18 (Licence undertakings), 17.11 (Licence), 17.12
(Pooling and
Settlement Agreement) and 17.13 (Compliance with the Act) only,
the ability of any
Borrower to meet any of its other material obligations under the
Finance Documents.
"Net Interest Payable"
means, in respect of any Relevant Period, Interest Payable plus
any dividends payable on the
Preferred Securities less Interest Receivable for that Relevant
Period.
"Novation Agreement"
means an agreement substantially in the form of Part II of
Schedule 5.
"Novation Certificate"
means a certificate substantially in the form of Part I of
Schedule 5.
"Original Group Accounts"
means the audited consolidated accounts of the Group for the year
ended 31st March, 1998.
"Party"
means a party to this Agreement.
"Permitted Borrower"
means:
(a) in relation to Facility A or Facility B, YPG; and
(b) in relation to Facility C, any Borrower.
"Permitted Security Interest"
means any Security Interest:
(a) arising pursuant to an order of attachment or injunction
restraining disposal of assets
or similar legal process which is contested by YPG or any of its
Subsidiaries in good
faith or created in favour of a plaintiff or defendant in any
action of the court or
tribunal before whom such action is brought as security for costs
or expenses where
YPG or one of its Subsidiaries is prosecuting or defending such
action in the bona fide
interests of the Group;
(b) arising by operation of law or contained in a contract
for the sale of goods or supply of
services entered into in the ordinary course of business of the
company creating the
same or which is a pledge over or assignment of documents of
title, insurance policies
and sale contracts in relation to commercial goods created or
made in the ordinary
course of business to secure the purchase price of goods or
indebtedness to finance
such purchase price;
(c) over or affecting (1) any asset acquired by a member of
the Group after the date hereof
and subject to which such asset is acquired or (2) any asset of
any company which
becomes a member of the Group after the date hereof, where such
Security Interest is
created prior to the date on which such company becomes a member
of the Group,
provided that in each case:
(i) the principal amount secured by such Security Interest is
not increased either
as a result of such acquisition or such company becoming a member
of the
Group or thereafter and, when aggregated with such other Security
Interests
under this paragraph (c), does not exceed (POUND)15,000,000 (or
its equivalent in any
other currency or currencies); or
(ii) that Security Interest is discharged within 180 days of
such acquisition or such
company becoming a member of the Group;
(d) which is a Security Interest (a "Substitute Security
Interest") which replaces any
Permitted Security Interest and which secures an amount not
exceeding the principal
amount secured by such Permitted Security in such circumstances
when such
Permitted Security Interest will be released as a consequence of
such Substitute
Security Interest being granted;
(e) arising in connection with any cash management or netting
arrangements made
between any banks or financial institutions and any member or
members of the Group;
(f) created prior to the date of this Agreement (including,
without limitation, any existing
Security Interest in favour of the European Investment Bank)
provided the principal
amount secured by such Security Interest shall not be increased
after the date of this
Agreement;
(g) arising out of title retention provisions in a supplier's
standard conditions of supply of
goods acquired by any member of the Group in the ordinary course
of business;
(h) over assets and/or (where such assets comprise
substantially the whole of the assets of
the owner thereof) shares or the like in the owner of such assets
securing borrowings
incurred to finance the cost of developing (or acquiring and
developing) such assets
(and/or securing any indebtedness in respect of hedging actual or
projected exposure in
respect of these borrowings) where such borrowings are Project
Finance Borrowings;
(i) created under or pursuant to, or in accordance or
connection with, the terms of any
pooling and settlement agreement (including, without limitation,
the Pooling and
Settlement Agreement) or pooling and settling arrangements of the
electricity supply
industry or any transactions or arrangements entered into in
connection with the
management of risks relating thereto;
(j) securing indebtedness not otherwise permitted to be
secured by Security Interests
provided that the aggregate principal amount of the indebtedness
so secured under this
paragraph (j) shall not at any time exceed (POUND)10,000,000 or
(if higher) 2 per cent. of
Adjusted Share Capital and Reserves; or
(k) to the creation or subsistence of which the Majority
Banks at any time consent in
writing.
"Pooling and Settlement Agreement"
means an agreement dated 30th March 1990 (as amended and restated
at 22nd April, 1994),
made by YEG with The National Grid Company plc and others setting
out the rules and
procedures for the operation of an electricity trading pool and
of a settlement system and, while
the same has effect, the Initial Settlement Agreement dated 30th
March 1990.
"Preferred Securities"
means US$275,000,000 8.08% Trust Securities due June 2038.
"Principal Subsidiary"
means YH, YEG or a Subsidiary of YPG (not being a Subsidiary
falling within category (a) of
the definition of Project Finance Borrowings or any other
Subsidiary of YPG whose only
Borrowings are Project Finance Borrowings):
(a) whose (i) net assets or (ii) turnover represent 10 per
cent. or more of the net assets of
the Group or consolidated turnover of the Group respectively, in
each case as
calculated by reference to the then latest audited financial
statements of such
Subsidiary (consolidated in the case of a company which itself
has Subsidiaries and
which, in the normal course, prepares consolidated accounts) and
the then latest
audited consolidated financial statements of the Group; or
(b) to which is transferred all or substantially all of the
business, undertaking and assets of
a Subsidiary of YPG which immediately prior to such transfer is a
Principal
Subsidiary, whereupon the transferor Subsidiary shall immediately
become a Principal
Subsidiary and the transferee Subsidiary shall cease to be a
Principal Subsidiary under
the provisions of this sub-paragraph (b) (but without prejudice
to the provisions of
sub-paragraph (a) above), upon publication of its next audited
financial statements; or
(c) which is a Licence Holder.
"Project Finance Borrowings"
means any Borrowings to finance the ownership, acquisition,
construction, development and/or
operation of an asset:
(a) made by a single purpose company (whether or not a member
of the Group) whose
principal assets and business are constituted by the ownership,
acquisition,
construction, development and/or operation of an asset and whose
liabilities in respect
of the relevant financing are not directly or indirectly the
subject of a guarantee,
indemnity or any other form of assurance, undertaking or support
from any member of
the Group except as expressly referred to in paragraph (b)(iii)
below; or
(b) in respect of which the person or persons to whom such
Borrowings are or may be
owed by the relevant borrower (whether or not a member of the
Group) has or have no
recourse whatsoever to any member of the Group for the repayment
of or payment of
any sum relating to such Borrowings other than:
(i) recourse to the relevant borrower for amounts limited to
the aggregate cash
flow or net cash flow (other than historic cash flow or historic
net cash flow)
from such asset; and/or
(ii) recourse to such borrower for the purpose only of
enabling amounts to be
claimed in respect of those Borrowings in an enforcement of any
Security
Interest given by such borrower over such asset or the income,
cash flow or
other proceeds arising therefrom (or given by any shareholder or
the like in the
borrower over its shares or the like in the capital of the
relevant borrower) to
secure those Borrowings or any recourse referred to in (iii)
below, provided
that (A) the extent of such recourse to such borrower is limited
solely to the
amount of any recoveries made on any such enforcement, and (B)
such person
or persons are not entitled, by virtue of any right or claim
arising out of or in
connection with such Borrowings, to commence proceedings for the
winding
up or dissolution of the borrower or to appoint or procure the
appointment of
any receiver, trustee or similar person or officer in respect of
the borrower or
any of its assets (save for the assets the subject of such
Security Interest);
and/or
(iii) recourse to such borrower generally, or directly or
indirectly to a member of
the Group under any form of assurance, undertaking or support,
which
recourse is limited to a claim for damages (other than liquidated
damages and
damages required to be calculated in a specified way) for breach
of an
obligation (not being a payment obligation or any obligation to
procure
payment by another or an obligation to comply or to procure
compliance by
another with any financial ratios or other tests of financial
condition) by the
person against whom such recourse is available; or
(c) which the Agent (acting on the instructions of the
Majority Banks) shall have agreed
(acting reasonably) in writing to treat as a Project Finance
Borrowing for the purposes
of this Agreement.
"Qualifying Bank"
means a bank which:
(a) is a bank within the meaning of Section 840A of the
Income and Corporation Taxes
Xxx 0000;
(b) will be beneficially entitled to any interest to be paid
to it (as a Bank) under this
Agreement; and
(c) is within the charge to United Kingdom corporation tax as
respects such interest.
"Reference Banks"
means, subject to Clause 25.4 (Reference Banks), the Agent,
Deutsche Bank AG London and
National Westminster Bank Plc.
"Relevant Period"
means each period of 12 months ending on the date of the audited
consolidated accounts for
each of YPG's financial years and on the date of YPG's unaudited
consolidated accounts for the
first half of each of YPG's financial years.
"Repayment Date"
means the fifth anniversary of the date of this Agreement.
"Request"
means a request made by a Borrower for a Loan, substantially in
the form of Schedule 4.
"Rollover Loan"
means one or more Facility A Loans or Facility C Loans:
(a) whose proposed Drawdown Date is the same as the last day
of the Interest Period of
one or more existing Facility A Loans or Facility C Loans
borrowed under the same
Facility; and
(b) whose aggregate principal amount does not exceed the
aggregate outstanding principal
amount of all existing Facility A Loans or Facility C Loans under
the relevant Facility
whose Interest Period ends on that Drawdown Date.
"Secretary of State"
means the person from time to time holding office as the
Secretary of State for Trade and
Industry or any successor office thereto;
"Security Interest"
means any mortgage, pledge, lien (other than a lien arising by
operation of law), charge or
other security interest.
"Subordinated Debt"
means, at any time, the outstanding amount (including capitalised
interest) of Borrowings
which is:
(a) owing by YPG to any of its shareholders; and
(b) fully subordinated to the indebtedness of the Borrowers
under this Agreement by a
subordination agreement in an agreed form.
"Subsidiary"
means:-
(a) a subsidiary within the meaning of Section 736 of the
Companies Xxx 0000 as
amended by Section 144 of the Companies Xxx 0000; and
(b) unless the context otherwise requires, a subsidiary
undertaking within the meaning of
Section 21 of the Companies Xxx 0000.
"Syndication Period"
means the period from the date of this Agreement to the earlier
of:
(a) the date on which the Arrangers confirm to YPG that
syndication of the Facilities is
complete; and
(b) 30th September, 1998,
or, if New Banks (as defined in Clause 25.2 (Transfers by Banks))
have agreed to commit to
join the Facilities under the syndication by the Arrangers but
the relevant Novation Agreement
or Novation Certificate has not been effected by the end of the
Syndication Period, such longer
period as YPG shall agree with the Arrangers.
"Term Date"
means the date falling ten Business Days after the date of this
Agreement.
"Total Commitments"
means the aggregate for the time being of the Commitments, being
(POUND)330,000,000 at the date of
this Agreement.
"YEG Facility"
means the agreement dated on or about the date of this Agreement
and made between YEG, the
Arrangers, the Banks and the Agent.
1.2 Construction
(a) In this Agreement, unless the contrary intention appears,
a reference to:-
(i) an "agreed form" means, in the case of a document, the
form of that document agreed
between YPG and the Agent as evidenced by the initialling of that
document (or other
written confirmation of the same) by YPG and the Agent or their
respective legal
advisers;
"assets" includes present and future properties, revenues and
rights of every
description;
an "authorisation" includes an authorisation, consent, approval,
resolution, licence,
exemption, filing and registration;
a "month" is a reference to a period starting on one day in a
calendar month and
ending on the numerically corresponding day in the next calendar
month, except that, if
there is no numerically corresponding day in the month in which
that period ends, that
period shall end on the last day in that calendar month;
a "regulation" includes any regulation, rule, official directive,
request or guideline
(whether or not having the force of law but, if not having the
force of law, being of a
type with which a relevant person is accustomed to comply) of any
governmental body,
agency, department or regulatory, self-regulatory or other
authority or organisation;
"(POUND)" and "sterling" means the lawful currency for the time
being of the United
Kingdom; and
"tax" includes any present or future tax, levy, impost, duty,
charge, fee deduction or
withholding of any nature and whatever called by whomsoever and
wherever imposed,
levied, collected, withheld or assessed;
(ii) a provision of law is a reference to that provision as
amended or re-enacted;
(iii) a Clause or a Schedule is a reference to a clause of or a
schedule to this Agreement;
(iv) a person includes its successors and assigns;
(v) a Finance Document or another document is a reference to
that Finance Document or
other document as amended, novated or supplemented; and
(vi) a time of day is a reference to London time.
(b) Unless the contrary intention 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.
(c) The index to and the headings in this Agreement are for
convenience only and are to be ignored
in construing this Agreement.
1.3 Financial definitions
In this Agreement, Adjusted Share Capital and Reserves as at the
end of a Relevant Period, and
EBITDA, Interest Payable and Interest Receivable for any Relevant
Period shall be determined
or calculated by reference to the financial statements of YPG or
any other relevant entity for
that Relevant Period delivered to the Agent under Clause 16.2
(Financial information).
2. THE FACILITIES
2.1 Facilities
(a) Subject to the terms of this Agreement, the Banks agree:
(i) to make Facility A Loans (being revolving Loans up to the
Facility A Term Date and
thereafter being term Loans) available to YPG during the Facility
A Commitment
Period up to an aggregate principal amount not exceeding at any
time the aggregate of
the Facility A Commitments; and
(ii) to make Facility B Loans (being term Loans) available to
YPG during the Facility B
Commitment Period up to an aggregate principal amount not
exceeding at any time the
aggregate of the Facility B Commitments; and
(iii) to make Facility C Loans (being revolving Loans)
available to the Borrowers during
the Facility C Commitment Period up to an aggregate principal
amount not exceeding
at any time the aggregate of the Facility C Commitments.
(b) No Bank is obliged to lend more than the sum of its
Commitments or, in respect of any
Facility, its Commitment in respect of that Facility.
2.2 Nature of a Finance Party's rights and obligations
(a) The obligations of a Finance Party under the Finance
Documents are several. Failure of a
Finance Party to carry out those obligations does not relieve any
other Party of its obligations
under the Finance Documents. No Finance Party is responsible for
the obligations of any other
Finance Party under the Finance Documents.
(b) The rights of a Finance Party under the Finance Documents
are divided rights. A Finance
Party may, except as otherwise stated in the Finance Documents,
separately enforce those
rights.
2.3 Change of currency
(a) If more than one currency or currency unit denomination
are at the same time recognised by
the central bank of any country as the lawful currency of that
country, then:-
(i) any reference in the Finance Documents to, and any
obligations arising under the
Finance Documents in, the currency of that country shall be
translated into, or paid in,
the currency or currency unit of that country designated by the
Agent; and
(ii) any translation from one currency or currency unit to
another shall be at the official
rate of exchange or conversion rate recognised by the central
bank for the conversion
of that currency or currency unit into the other, rounded up or
down by the Agent
acting reasonably.
(b) If a change in any currency of a country occurs, this
Agreement will be amended to the extent
the Agent specifies to be necessary to reflect the change in
currency and to put the Banks and
the Borrowers in the same position, so far as possible, that they
would have been in if no
change in currency had occurred.
3. PURPOSE
(a) YPG shall apply each Loan made to it under Facility A or
Facility B towards its general
corporate purposes and those of its Subsidiaries including
(without limitation) prepayment of
the Existing Facilities. Each Borrower shall apply each loan
made to it under Facility C
towards its general corporate purposes and those of its
Subsidiaries.
(b) Without affecting the obligations of any Borrower in any
way, no Finance Party is bound to
monitor or verify the application of any Loan.
4. CONDITIONS PRECEDENT
4.1 Documentary conditions precedent
(a) A Borrower may not deliver a Request until the Agent has
notified that Borrower and the
Banks that it has received all the documents set out in Schedule
2 in respect of that Borrower in
the agreed form or, if not in the agreed form, in form and
substance satisfactory to the Agent;
and
(b) For the avoidance of doubt, a Borrower shall not be
prevented by paragraph (a) above from
delivering a Request solely because any other Borrower has not
satisfied the conditions
precedent relating to that Borrower in accordance with paragraph
(a) above.
4.2 Conditions precedent to first Loan
The obligation of each Bank to make the first Loan to any
Borrower is subject to the further
condition precedent that the Agent has received evidence
satisfactory to it that, on that first
Drawdown Date, the Existing Facilities have been (or will be
immediately following the making
of the first Loan) prepaid and cancelled in full.
4.3 Further conditions precedent
The obligation of each Bank to make any Loan is subject to the
further conditions precedent
that on both the date of the Request and the Drawdown Date:-
(a) the representations and warranties in Clause 15
(Representations and warranties) to be
repeated on those dates are correct in all material respects and
will be correct in all
material respects immediately after the Loan is made; and
(b) (i) (in the case of a Loan other than a Rollover
Loan) no Default;
(ii) in the case of a Rollover Loan, no Event of Default
is outstanding or would result from the making of the Loan.
5. DRAWDOWN
5.1 Commitment Period
(a) A Borrower may borrow a Loan under a Facility during the
relevant Commitment Period if the
Agent receives, not later than 10.00 a.m. on the Business Day
before the proposed Drawdown
Date a duly completed Request. Each Request is irrevocable.
(b) The undrawn amount (if any) of the Facility A Commitment
shall automatically be cancelled at
close of business on the Facility A Term Date. The undrawn
amount (if any) of the Facility B
Commitment shall automatically be cancelled in full on the Term
Date. The Facility C
Commitment shall automatically be cancelled in full on the
Repayment Date.
5.2 Completion of Requests
A Request will not be regarded as having been duly completed
unless:-
(a) the Drawdown Date is a Business Day (which, in the case
of Facility A, must fall on or
before the Facility A Term Date and, in the case of Facility B,
must fall on or before
the Term Date);
(b) the Facility under which the Loan is to be made is
specified;
(c) the proposed Borrower is a Permitted Borrower in relation
to the selected Facility;
(d) the principal amount of the Loan is a minimum of
(POUND)20,000,000 (in the case of
Facility A or Facility B) or (POUND)5,000,000 (in the case
of Facility C) and (in each case) is
an integral multiple of (POUND)5,000,000 or the balance of the
relevant undrawn
Commitment;
(e) the first Interest Period selected complies with Clause 8
(Interest Periods); and
(f) the payment instructions comply with Clause 10
(Payments).
Each Request must specify one Loan only, but a Borrower may,
subject to the other terms of
this Agreement, deliver more than one Request on any one day.
Unless otherwise agreed by the
Agent, the number of Loans outstanding, together with the number
of sterling-denominated
loans outstanding under the YEG Facility, shall not at any time
exceed ten.
5.3 Advance of Loan
(a) The Agent shall promptly notify each Bank of the details
of a requested Loan and the amount
of its participation in that Loan.
(b) Subject to the terms of this Agreement, each Bank shall
make its participation in a Loan
available to the Agent for each Borrower on the relevant Drawdown
Date.
(c) The amount of each Bank's participation in a Loan under a
Facility will be the proportion of
the Loan which its Commitment in relation to the relevant
Facility bears to the Total
Commitments in relation to that Facility on the proposed Drawdown
Date.
6. REPAYMENT
6.1 Facility A and term-out
The Borrower shall repay each Facility A Loan in full:-
(a) if the first Interest Period for that Facility A Loan
would end before the Facility A
Term Date, on the last day of the Interest Period for that
Facility A Loan; or
(b) otherwise, on the Facility A Repayment Date.
6.2 Facility B
YPG shall repay each Facility B Loan in full on the Repayment
Date.
6.3 Facility C
Each Facility C Loan shall be repaid in full by the Borrower to
whom it was made on the last
day of the Interest Period for that Facility C Loan.
6.4 Re-borrowing
(a) Amounts repaid under Facility A may be re-borrowed, in
accordance with the terms of this
Agreement, prior to the Facility A Term Date.
(b) Amounts repaid under Facility C may be re-borrowed, in
accordance with the terms of this
Agreement, prior to the Repayment Date.
(c) Subject to paragraphs (a) and (b) above, no amount repaid
under this Agreement may be re-
borrowed.
7. PREPAYMENT AND CANCELLATION
7.1 Voluntary prepayment
(a) Any Borrower may at any time, by giving not less than
five Business Days' prior notice (or
such shorter period as the Majority Banks may agree) to the
Agent, prepay any Loan made to it
multiple of (POUND)5,000,000).
(b) Any prepayment of a Loan under this Clause 7.1 shall be
applied pro rata against the
participations of each Bank participating in that Loan.
7.2 Voluntary cancellation
(a) The Borrowers (acting together) may, by giving not less
than five Business Days' prior notice
(or such lesser period as the Majority Banks may agree) to the
Agent, cancel the undrawn
amount of the Total Commitments in relation to one or more
Facilities in whole or in part (but,
if in part, in a minimum amount of (POUND)10,000,000 and an
integral multiple of (POUND)5,000,000).
(b) Any cancellation in part shall be applied pro rata
against the relevant Commitment of each
Bank.
7.3 Additional right of prepayment and cancellation
(a) If:-
(i) any Borrower is required to pay to a Finance Party any
additional amounts under
Clause 11 (Taxes); or
(ii) any Borrower is required to pay to a Finance Party any
amount under Clause 13
(Increased costs)
then, without prejudice to the obligations of the Borrowers under
those Clauses, the affected
Borrower or Borrowers may, whilst the relevant circumstances
continue, serve a notice of
prepayment and cancellation on that Bank through the Agent. In
that event:-
(i) each of the Commitments of that Bank shall be cancelled;
and
(ii) on the date falling five Business Days after the date of
service of the notice, each
Borrower shall prepay that Bank's participation in all the Loans
made to it.
(b) If interest on a Loan is being calculated in accordance
with Clause 12.2 (Alternative basis),
then, without prejudice to the obligations of the Borrowers under
that Clause, the affected
Borrower or Borrowers may, whilst the relevant circumstances
continue, serve a notice of
prepayment and cancellation on each Bank through the Agent. On
the date falling
five Business Days after the date of service of the notice, the
Borrower or Borrowers giving
such notice shall prepay all the Loans made to it (or them).
7.4 Miscellaneous provisions
(a) Any notice of prepayment and/or cancellation under this
Agreement is irrevocable.
(b) All prepayments under this Agreement shall be made
together with accrued interest on the
amount prepaid and, subject to Clause 22.2 (Other indemnities),
without premium or penalty.
(c) No prepayment or cancellation is permitted except in
accordance with the express terms of this
Agreement.
(d) No amount of a Commitment cancelled under this Agreement
may subsequently be reinstated.
No amount prepaid under Facility A on or after the Facility A
Term Date or under Facility B at
any time may subsequently be re-borrowed. Subject to the terms
of this Agreement, amounts
prepaid under Facility A before the Facility A Term Date may be
reborrowed and amounts
prepaid under Facility C at any time may be reborrowed.
8. INTEREST PERIODS
8.1 General
(a) Each Facility A Loan shall have one Interest Period only
unless that Interest Period would end
after the Facility A Term Date, in which case it shall have
successive Interest Periods.
(b) Each Facility B Loan shall have successive Interest
Periods.
(c) Each Facility C Loan shall have one Interest Period only.
(d) (i) Any Interest Period for a Facility A Loan which
would otherwise end during the week
preceding, or extend beyond, the Facility A Repayment Date shall
be of such duration
that it shall end on the Facility A Repayment Date.
(ii) Any Interest Period for a Facility B Loan or a Facility C
Loan which would otherwise
end during the week preceding, or extend beyond, the Repayment
Date shall be of such
duration that it shall end on the Repayment Date.
8.2 Selection
(a) A Borrower may select an Interest Period for a Loan in
either the relevant Request or, if (in the
case of a Facility A Loan after the Facility A Term Date or a
Facility B Loan) the Loan has
been borrowed, a notice received by the Agent not later than
11.00 a.m. on the Business Day
before the commencement of that Interest Period. Each Interest
Period for a Loan will
commence on its Drawdown Date or (in the case of a Facility A
Loan after the Facility A Term
Date or a Facility B Loan which (in either case) has already been
borrowed) the expiry of its
preceding Interest Period.
(b) Subject to the following provisions of this Clause 8,
each Interest Period will be either an
approved duration or an optional duration as so selected under
paragraph (a) above.
In this Clause 8:-
"approved duration" means one, two, three or six months; and
"optional duration" means any other period agreed by the Banks.
(c) If a Borrower fails to select an Interest Period for an
outstanding Facility A Loan after the
Facility A Term Date or a Facility B Loan in accordance with
paragraph (a) above, that
Interest Period will, subject to the other provisions of this
Clause 8, be three months.
(d) No Interest Period for a Facility A Loan may extend
beyond the Facility A Repayment Date.
No Interest Period for a Facility B Loan or a Facility C Loan may
extend beyond the
Repayment Date.
(e) The Borrowers may not select an Interest Period in excess
of one month during the Syndication
Period.
8.3 Selection of an optional duration
(a) If a Borrower selects an Interest Period of an optional
duration, it may also select an Interest
Period of an approved duration to apply if the selection of an
optional duration becomes
ineffective in accordance with paragraph (b) below.
(b) If:-
(i) a Borrower requests an Interest Period of an optional
duration; and
(ii) the Agent notifies that Borrower not later than 10.30
a.m. on the first Business Day of
that Interest Period that matching deposits are not available to
the Reference Banks in
the London interbank market to fund the Loan for that Interest
Period,
the Interest Period for that Loan shall be the alternative period
so specified or, in the absence of
any alternative selection, one month.
8.4 Non-Business Days
If an Interest Period would otherwise end on a day which is
not a Business Day, that Interest
Period shall instead end on the next Business Day in that
calendar month (if there is one) or the
preceding Business Day (if there is not).
8.5 Consolidation and splitting
(a) Notwithstanding Clause 8.2 (Selection), if YPG so
requests at any time after the Facility A
Term Date, the Facility A Loans outstanding after the Facility A
Term Date shall be
consolidated and/or split in accordance within the directions of
YPG.
(b) Notwithstanding Clause 8.2 (Selection), the first
Interest Period for each Facility B Loan shall
end on the same day as the current Interest Period for any other
Facility B Loan. On the last
day of those Interest Periods, those Loans shall be consolidated
and treated as one Loan.
(c) YPG may, subject to Clause 2.1(b) (Facilities) , in any
notice selecting an Interest Period for
an outstanding Facility B Loan under Clause 8.2 (Selection),
direct that the Facility B Loan in
question shall, at the beginning of that Interest Period be
divided into (and thereafter be treated
for all purposes under this Agreement as) two Facility B Loans in
such amount each being a
minimum of (POUND)25,000,000 and an integral multiple of
(POUND)5,000,000 as YPG shall specify and on
the first day of the Interest Period to which that notice relates
those Facility B Loans shall be so
divided.
8.6 Other adjustments
The Agent and any Borrower may enter into such other arrangements
as they may agree for the
adjustment of Interest Periods and the consolidation and/or
splitting of Facility A Loans (after
the Facility A Term Date and the Facility B Loans. Any such
arrangements shall be notified to
the relevant Banks by the Agent and shall be binding on them.
8.7 Notification
The Agent shall notify each relevant Party of the duration of
each Interest Period promptly
after ascertaining its duration.
9. INTEREST
9.1 Interest rate
The rate of interest on each Loan for each of its Interest
Periods is the rate per annum
determined by the Agent to be the aggregate of the applicable:-
(a) Margin;
(b) LIBOR; and
(c) Mandatory Cost.
9.2 Due dates
Except as otherwise provided in this Agreement, accrued interest
on each Loan is payable by
the relevant Borrower on the last day of each Interest Period for
that Loan and also, if the
Interest Period is longer than 6 months, on the date falling 6
months after the first day of that
Interest Period.
9.3 Default interest
(a) If a Borrower fails to pay any amount payable by it under
this Agreement, it shall forthwith on
demand by the Agent pay interest on the overdue amount from the
due date up to the date of
actual payment, as well after as before judgment, at a rate (the
"default rate") determined by
the Agent to be 1 per cent. per annum above the rate which would
have been payable if the
overdue amount had, during the period of non-payment, constituted
a Loan for such successive
Interest Periods of such duration as the Agent may determine
(each a "Designated Interest
Period").
(b) The default rate will be determined by the Agent on each
Business Day or the first day of, or
two Business Days before the first day of, the relevant
Designated Interest Period, as
appropriate.
(c) If the default rate is to be calculated by reference to
LIBOR and no rates are being quoted on
the Telerate Screen or the Reuters Screen and the Agent
determines that deposits of the overdue
amount are not at the relevant time being made available by the
Reference Banks to leading
banks in the London interbank market, the default rate will be
determined by reference to the
cost of funds to the Agent from whatever sources it may select.
(d) Default interest will be compounded at the end of each
Designated Interest Period.
9.4 Margin adjustment
The Margin shall be determined by reference to the most recently
delivered certificate under
Clause 16.2(c) (Financial information). If that certificate
shows that a change in the applicable
Margin is required, that change shall take effect within three
Business Days of the delivery of
that certificate to the Agent for all Loans which are outstanding
or which are to be made. That
Margin shall apply until the next change in the Margin following
delivery of a certificate under
Clause 16.2(c) (Financial information) which shows that a further
change in the Margin is
required.
9.5 Notification
The Agent shall promptly notify each relevant Party of each
determination of each rate of
interest under this Agreement.
10. PAYMENTS
10.1 Place
All payments under the Finance Documents by a Borrower or a Bank
shall be made to the
Agent to its account at such office or bank in the U.K. as it may
notify to that Borrower or
Bank for this purpose.
10.2 Funds
Payments under the Finance Documents to the Agent shall be made
for value on the due date at
such times and in such funds as the Agent may specify as being
customary at the time for the
settlement of transactions in sterling.
10.3 Distribution
(a) Each payment received by the Agent under the Finance
Documents for another Party shall,
subject to paragraphs (b) and (c) below, be made available by the
Agent to that Party by
payment (on the date and in the currency and funds of receipt) to
its account with such bank in
the principal financial centre of the country of the relevant
currency as it may notify to the
Agent for this purpose by not less than five Business Days' prior
notice.
(b) The Agent may apply any amount received by it for a
Borrower in or towards payment (on the
date and in the currency and funds of receipt) of any amount due
from a Borrower under this
Agreement or in or towards the purchase of any amount of any
currency to be so applied.
(c) Where a sum is to be paid under this Agreement to the
Agent under the Finance Documents for
another Party, the Agent is not obliged to pay that sum to that
Party until it has established that
it has actually received that sum. The Agent may, however,
assume that the sum has been paid
to it in accordance with this Agreement and, in reliance on that
assumption, make available to
that Party a corresponding amount. If the sum has not been made
available but the Agent has
paid a corresponding amount to another Party, that Party shall
refund the corresponding
amount within three Business Days of demand, together with
interest on that amount from the
date of payment to the date of receipt, calculated at a rate
determined by the Agent to reflect its
cost of funds.
10.4 Currency
(a) Amounts payable in respect of costs, expenses and taxes
and the like are payable in the
currency in which they are incurred.
(b) Any other amount payable under the Finance Documents is,
except as otherwise provided in the
Finance Documents, payable in sterling.
10.5 Set-off and counterclaim
All payments made by a Borrower under the Finance Documents shall
be made without set-off
or counterclaim.
10.6 Non-Business Days
(a) If a payment under the Finance Documents is due on a day
which is not a Business Day, the
due date for that payment shall instead be the next Business Day
in the same calendar month (if
there is one) or the preceding Business Day (if there is not).
(b) During any extension of the due date for payment of any
principal under this Agreement
interest is payable on that principal at the rate payable on the
original due date.
10.7 Partial payments
(a) If the Agent receives a payment insufficient to discharge
all the amounts then due and payable
by the Borrowers under this Agreement, the Agent shall apply that
payment towards the
obligations of the Obligors under this Agreement in the following
order:-
(i) first, in or towards payment pro rata of any unpaid fees,
costs and expenses of the
Agent under this Agreement;
(ii) secondly, in or towards payment pro rata of any accrued
interest 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 shall, if so directed by all the Banks, vary
the order set out in sub-paragraphs (a)(ii)
to (iv) above.
(c) Paragraphs (a) and (b) above will override any
appropriation made by a Borrower.
11. TAXES
11.1 Gross-up
Subject to Clause 11.4 (Exceptions from gross-up), each payment
to be made by a Borrower
under this Agreement shall be made free and clear of and without
deduction or withholding
(whether for or on account of tax or otherwise) unless the
relevant Borrower is required by law
to make such a payment subject to such deduction or withholding
in respect of any taxes
imposed by laws of the United Kingdom or any federation or
association of sovereign states of
which the United Kingdom is a member ("Relevant Taxes"). If any
Relevant Tax or amounts
in respect of Relevant Tax must be deducted, or any other
deductions must be made, from any
amounts payable or paid by a Borrower, or paid or payable by the
Agent to a Bank, under the
Finance Documents, that Borrower shall (subject as provided in
this Clause) increase the sum
payable to the extent necessary to ensure that, after the making
of such deduction or
withholding, the relevant Bank receives and retains (free from
any liability in respect of any
such deduction or withholding) a net sum equal to the sum which
it would have received and so
retained had no such deduction or withholding been made or
required to be made.
11.2 Tax receipts
Within 30 days after paying any sum from which it is required by
law to make any deduction
or withholding, the relevant Borrower shall deliver to the Agent
for the relevant Bank evidence
satisfactory to that Bank of that deduction, withholding or
payment and (where remittance is
required) of the remittance thereof to the relevant taxing or
other authority (a receipt by the
relevant taxing or other authority being deemed to be such
evidence).
11.3 Tax credits
If a Borrower makes a payment under Clause 11.1 (Gross-up) for
the account of a Bank and
that Bank determines that it has received or been granted a
credit against or relief or remission
for, or repayment of, any tax paid or payable by it in respect of
or calculated with reference to
the deduction or withholding under Clause 11.1 (Gross-up) that
Bank shall, to the extent that it
can do so without prejudice to the retention of the amount of
such credit, relief, remission or
repayment, pay to that Borrower such amount as that Bank
determines is attributable to such
deduction or withholding under Clause 11.1 (Gross-up) and which
will leave that Bank (after
such payment) in no better or worse position than it would have
been in if that Borrower had
not been required to make such deduction or withholding under
Clause 11.1 (Gross-up).
Nothing in this Clause 11.3 shall interfere with the right of a
Bank to arrange its tax affairs in
whatever manner it thinks fit nor oblige a Bank to disclose any
information relating to its tax
affairs or any computations in respect thereof.
11.4 Exceptions from gross-up
(a) If:
(i) a Bank is not or ceases to be a Qualifying Bank; and
(ii) as a result a Borrower is required to deduct or withhold
United Kingdom income tax in
respect of payments of interest to be made by that Borrower to
that Bank under this
Agreement,
then that Borrower shall not be liable to pay under Clause 11.1
(Gross-up) in respect of any
such payment of interest any amount in excess of the amount it
would have been obliged to pay
if that Bank were a Qualifying Bank provided that this Clause
11.4 shall not apply if, after the
date of this Agreement any change occurs in, or in the official
interpretation or application of,
any relevant law or the practice of the United Kingdom Inland
Revenue and as a result thereof
that Bank is not or ceases to be a Qualifying Bank.
(b) The obligation of a Borrower to pay an additional amount
under Clause 11.1 (Gross-up) shall
not apply to the extent that the tax deducted is tax on the
overall net income of a Bank save to
the extent that such tax is in respect of the relevant payment
from which the deduction must be
made.
11.5 Notification
If at any time after the date of this Agreement a Bank is aware
that it is not or will cease to be a
Qualifying Bank (for whatever reason), it shall promptly notify
the Borrowers through the
Agent.
12. MARKET DISRUPTION
12.1 Absence of quotations
If LIBOR is to be determined by reference to the Reference Banks
but a Reference Bank does
not supply an offered rate by 11.30 a.m. on the Drawdown Date,
the applicable LIBOR shall,
subject to Clause 12.2 (Market disruption), be determined on the
basis of the quotations of the
remaining Reference Banks.
12.2 Market disruption
If:
(a) LIBOR is to be determined by reference to the Reference
Banks but no, or only one,
Reference Bank supplies a rate by 11.30 a.m. on the Drawdown Date
or the Agent
otherwise determines that, by reason of circumstances affecting
the London Interbank
Market generally and not specific to the Bank or Banks concerned,
adequate and fair
means do not exist for ascertaining LIBOR; or
(b) the Agent receives notification from Banks whose
participations in a Loan exceed
50 per cent. of that Loan that, by reason of circumstances
affecting the London
Interbank Market generally and not specific to the Bank or Banks
concerned:-
(i) matching deposits will not be available to them in the
London interbank market
in the ordinary course of business to fund their participations
in that Loan for
the relevant Interest Period; or
(ii) the cost to them of matching deposits in the London
interbank market would be
in excess of LIBOR for the relevant Interest Period,
the Agent shall promptly notify each Borrower and the relevant
Banks of the fact and
that this Clause 12 is in operation.
12.3 Alternative basis
(a) If a notification under Clause 12.2 (Market disruption)
applies to a Loan which has not been
made:
(i) that Loan shall still be made;
(ii) the first Interest Period of that Loan shall be one
month; and
(iii) interest in respect of that Loan shall be calculated in
accordance with paragraph (b)
below.
(b) If a notification under Clause 12.2 (Market disruption)
applies to a Loan which is made under
paragraph (a) above or which is outstanding then, notwithstanding
any other provision of this
Agreement:
(i) within five Business Days of receipt of the notification,
the Borrower to which that was
made and the Agent shall enter into negotiations for a period of
not more than 30 days
with a view to agreeing an alternative basis for determining the
rate of interest and/or
funding applicable to that Loan and/or any other Loans;
(ii) if no alternative basis is agreed, the Agent shall
certify on or before the last day of the
Interest Period to which the notification relates an alternative
basis for maintaining that
Loan, which shall be binding on the relevant Borrower; and
(iii) any such alternative basis may include an alternative
method of fixing the interest rate,
alternative Interest Periods or alternative currencies but it
must reflect the cost to the
Banks of funding the Loan from whatever sources they may select
plus the Margin
plus any Mandatory Cost.
(c) The Agent shall consult with the relevant Borrower or
Borrowers at least once every 14 days
after the occurrence and during the continuance of the
circumstances specified in the foregoing
provisions of this Clause 12 with a view to reverting to the
normal provisions for the
determination of the rates of interest applicable to any Loan.
13. INCREASED COSTS
13.1 Increased costs
(a) Subject to Clause 13.2 (Exceptions), the Borrowers shall
within five Business Days of a
demand by a Bank pay to that Bank the amount of any increased
cost incurred by it or its
holding company as a result of any change in or change in the
interpretation or application of
any law or regulation (including any law or regulation relating
to taxation, or reserve asset,
special deposit, cash ratio, liquidity or capital adequacy
requirements or any other form of
banking or monetary control). Any such demand shall set out in
reasonable detail the
calculation and the cause of the amounts claimed and contain
confirmation that the affected
Bank is taking the same approach in relation to the majority of
its other facilities of a similar
nature.
(b) In this Agreement "increased cost" means:
(i) an additional cost incurred by a Bank or its holding
company as a result of that Bank
having entered into, or performing, maintaining or funding its
obligations under, this
Agreement; or
(ii) that portion of an additional cost incurred by a Bank or
its holding company in that
Bank making, funding or maintaining all or any advances comprised
in a class of
advances formed by or including the Loans made or to be made
under this Agreement
as is attributable to it or its holding company in that Bank
making, funding or
maintaining the Loans; or
(iii) a reduction in any amount payable to a Bank or its
holding company or the effective
return to a Bank or its holding company under this Agreement or
on its capital; or
(iv) the amount of any payment made by a Bank or its holding
company, or the amount of
any interest or other return foregone by a Bank or its holding
company, calculated by
reference to any amount received or receivable by a Bank under
this Agreement.
13.2 Exceptions
Clause 13.1 (Increased costs) does not apply to any increased
cost:-
(a) compensated for by the payment of the Mandatory Cost;
(b) compensated for by the operation of Clause 11 (Taxes) or
which would have been
compensated under that Clause but for the operation of Clause
11.4 (Exceptions from
gross-up);
(c) attributable to any change in the rate of tax on the
overall net income of a Bank;
(d) occurring as a result of any negligence or default of a
Bank, including, without
limitation, a breach by a Bank of any fiscal, monetary or capital
adequacy limit
imposed on it by any law or regulation; or
(e) occurring as a result of a transfer or novation of a
Bank's rights or obligations under
this Agreement; or
(f) any increased cost attributable to any implementation of
the proposals contained in any
of:-
(i) the statement of the Basle Committee on Banking
Regulations and Supervisory
Practices dated July 1988 and entitled "International Convergence
of Capital
Measurement and Capital Standards"; or
(ii) the EC Solvency Ratio Directive, EC Own Funds Directive,
or EC Capital
Adequacy Directive or any law, regulation, rule, official
directive, request or
guideline (whether or not having the force of law) of any
governmental body,
central bank, agency, department, regulatory, self-regulatory or
other authority
in any jurisdiction, implementing, applying or supplementing any
of them with
which a Bank complies or is required to comply,
in each case as published before the date of this Agreement
unless it results from any
change in, or change in the interpretation of or application of,
that statement, Directive,
law, regulation, rule, official directive, request or guideline
after the date of this
Agreement.
14. ILLEGALITY AND MITIGATION
14.1 Illegality
If it is or becomes unlawful in any jurisdiction for a Bank to
give effect to any of its obligations
as contemplated by this Agreement or to fund or maintain its
participation in any Loan, then:-
(a) that Bank may notify each Borrower through the Agent
accordingly; and
(b) (i) each Borrower shall forthwith prepay the
participations of that Bank in all or
part of the Loans made to it to the extent necessary to avoid the
relevant
illegality, together with accrued interest on that portion of
those Loans; and
(ii) the undrawn Commitments of that Bank shall be reduced to
such amount as
would be lawful or (if no such amount would be lawful) to zero,
in each case, on or before the last day before the relevant
unlawfulness takes effect.
14.2 Mitigation
If circumstances arise which would, or would on the giving of
notice, result in:-
(a) any additional amounts becoming payable under Clause 11
(Taxes); or
(b) any amount becoming payable under Clause 13 (Increased
costs); or
(c) any prepayment, early payment or cancellation under
Clause 14.1 (Illegality),
then, without limiting the obligations of the Borrowers under
this Agreement and without
prejudice to the terms of Clauses 11 (Taxes), 13 (Increased
costs) and 14.1 (Illegality), the
affected Finance Party may, in consultation with the relevant
Borrower or Borrowers, take
such steps as may reasonably be open to it to mitigate or remove
such circumstance, including
(without limitation) the transfer of its rights and obligations
under this Agreement to another
branch or another bank or financial institution acceptable to the
Borrowers, unless to do so
would (in the sole opinion of the affected Finance Party) be
prejudicial to it.
15. REPRESENTATIONS AND WARRANTIES
15.1 Representations and warranties
Each Borrower makes the representations and warranties set out in
this Clause 15
(Representations and warranties) to each Finance Party.
15.2 Status
(a) It is a limited liability company, duly incorporated and
validly existing under the laws of
England;
(b) each member of the Group has the power to own its assets
and carry on its business as it is
being conducted;
(c) (i) YH is the direct, wholly owned, Subsidiary of
YPG; and
(ii) YEG is the direct, wholly owned, Subsidiary of YH; and
(d) Each Licence Holder has been duly licensed and authorised
by the Secretary of State under
Section 6(I)(c) of the Act for the generation, distribution
and/or supply of electricity and the
Licence is in full force and effect.
15.3 Powers and authority
It has the power to enter into and perform, and has taken all
necessary action to authorise the
entry into, performance and delivery of, the Finance Documents to
which it is or will be a party
and the transactions contemplated by those Finance Documents.
15.4 Legal validity
Except as stated in any qualifications as to matters of law in
any legal opinion referred to in
Schedule 2, each Finance Document to which it is or will be a
party constitutes, or when
executed in accordance with its terms will constitute, its legal,
valid and binding obligation.
15.5 Non-conflict
(a) The entry into and performance by it of, and the
transactions contemplated by, the Finance
Documents do not and will not conflict with the Licence in any
material respect.
(b) The entry into and performance by it of, and the
transactions contemplated by, the Finance
Documents do not and will not:-
(i) conflict with any law or regulation or authorisation or
judicial or official order in any
material respect; or
(ii) conflict with the constitutional documents of any member
of the Group; or
(iii) conflict with the Licence or any document which is
binding upon any member of the
Group or any asset of any member of the Group to an extent or in
a manner which
would have a Material Adverse Effect.
15.6 No default
No Event of Default or Default is outstanding which has not been
remedied or waived or would
result from the making of any Loan.
15.7 Authorisations
All authorisations which are necessary for the entry into,
performance and validity of, and the
transactions contemplated by, the Finance Documents have been
obtained or effected (as
appropriate) and are in full force and effect.
15.8 Accounts
On and from the date that audited consolidated accounts of
the Group are first delivered to the
Agent under Clause 16.2 (Financial information), the audited
consolidated accounts of the
Group most recently delivered to the Agent:-
(a) have been prepared in accordance with accounting
principles and practices generally
accepted in the United Kingdom; and
(b) (in conjunction with the notes thereto) give a true and
fair view of the consolidated
financial condition of the Group as at the date to which they
were drawn up.
15.9 Material adverse change
Since the date as at which the most recent audited
consolidated financial statements of YPG
were stated to be prepared, there has been no material adverse
change in the financial condition
of Group taken as a whole.
15.10 Litigation
Save as disclosed in writing to the Agent prior to the date of
this Agreement no litigation or
arbitration is current or, to its knowledge, pending or has been
threatened in writing, which are
likely to be determined adversely to it and, if so determined,
might reasonably be likely to have
a Material Adverse Effect.
15.11 Licence
(a) The Licence is in full force and effect and there exist
no material breaches of the terms of the
Licence.
(b) There are no circumstances in existence which would be
likely to lead the Director General or
the Secretary of State to seek to revoke the Licence except in
each case where the relevant
event or circumstances would not have a Material Adverse Effect.
(c) YEG has not breached:
(i) any requirement of the Act or any regulations made
thereunder; or
(ii) any other statutory requirement or any final order or
confirmed provisional order in
each case made under the Act; or
(iii) any undertaking given by it to the Director General or
the Secretary of State in relation
to the conduct of its business as a generator of electricity or
as a public electricity
supplier (as the case may be),
the consequence of which is reasonably likely to have a Material
Adverse Effect.
(d) Neither the Director General nor the Secretary of State
has given notice to revoke a Licence.
(e) Save as described in writing to the Agent no amendment of
any of the terms of a Licence has
been made or proposed which is reasonably likely to have a
Material Adverse Effect.
15.12 Information
To the best of the knowledge of the Borrowers after due enquiry:
(a) the factual information contained in Sections 4, 5 and 6
of the Information
Memorandum (other than the information referred to in paragraph
(b) below) was true
in all material respects as at its date;
(b) the factual information contained in the Information
Memorandum which has been
taken from the SEC filing dated 3rd June, 1998 was true in all
material respects as at
the date of that SEC filing;
(c) all estimates and projections contained in the
Information Memorandum were prepared
by the Borrowers based upon assumptions that the Borrowers
considered to be
reasonable as at the date of their preparation and on the basis
of information available
to the Borrowers provided by third parties the Borrowers
believed, in each case, to be
reliable, except that no representation is made that these
estimates or projections will
be achieved;
(d) the Information Memorandum did not omit as at its date
any information which renders
the information contained in it untrue or misleading in any
material respect; and
(e) as at the date of the Credit Agreement, nothing has
occurred since the date of the
Information Memorandum which renders the factual information
contained in
Sections 4, 5 and 6 of the Information Memorandum untrue or
misleading in any
material respect.
15.13 Times for making representations and warranties
The representations and warranties set out in this Clause 15
(Representations and warranties):-
(a) are made on the date of this Agreement; and
(b) (other than the representations in Clauses 15.2(d)
(Status), 15.5(a) (Non-conflict), 15.9
(Material adverse change), 15.10 (Litigation), 15.11(c) to (e)
(Licence) and 15.12
(Information)) are deemed to be repeated by each Borrower on the
date of each
Request made by it and the first day of each Interest Period of a
Loan made to it with
reference to the facts and circumstances then existing but as if
the words in
Clause 15.6 (No default) "or Default" had been deleted.
16. UNDERTAKINGS
16.1 Duration
The undertakings in this Clause 16 (Undertakings) remain in force
from the date of this
Agreement for so long as any amount is or may be outstanding
under this Agreement or any
Commitment is in force.
16.2 Financial information
YPG shall supply to the Agent (with sufficient copies for all the
Banks):-
(a) as soon as the same are available (and in any event
within 180 days of the end of each
of its financial years), the audited consolidated accounts of the
Group for that financial
year;
(b) as soon as the same are available (and in any event
within 90 days of the end of the
first half-year of each of its financial years), the unaudited
consolidated accounts of the
Group for that half-year; and
(c) together with the accounts specified in paragraphs (a)
and (b) above, a certificate
signed by two of its directors on its behalf setting out in
reasonable detail computations
establishing compliance with Clause 16.17 (Financial covenants);
and
(d) as soon as the same are available (and in any case within
60 days of the end of each
relevant financial quarter of each of its financial years), the
unaudited quarterly
accounts required to be registered with the U.S. Securities and
Exchange Commission,
and all such accounts supplied under paragraphs (a) or (b) above
shall be prepared in
accordance with accounting principles generally accepted in the
United Kingdom.
16.3 Information - Miscellaneous
Each Borrower shall supply to the Agent (with sufficient copies
for all the Banks, if the Agent
so requests):-
(a) all documents despatched by it to its creditors generally
or (if it is not a close company
within the meaning of Section 414 of the Income and Corporation
Taxes Act, 1988) to
its shareholders generally (or any class of its shareholders
generally) at the same time
as they are despatched;
(b) promptly upon becoming aware of them, details of any
litigation, arbitration or
administrative proceedings which are current, threatened in
writing or pending, and
which if they had been current or threatened in writing on the
date of this Agreement
would have resulted in the representation in Clause 15.10
(Litigation) being incorrect
in any material respect; and
(c) promptly upon becoming aware that any modifications to
the Licence are being
proposed by the Director General or the Secretary of State,
reasonable details thereof,
to be updated from time to time to reflect any changes, provided
that such details shall
be required to be reported to the Agent hereunder, only to the
extent that if such
proposed modifications were to be made to the Licence, compliance
with such
modification or undertaking would have a Material Adverse Effect.
16.4 Notification of Default
Each Borrower shall notify the Agent of any Default or Event of
Default affecting it (and the
steps, if any, being taken to remedy it) promptly upon its
occurrence.
16.5 Compliance certificates
Each Borrower shall supply to the Agent:-
(a) together with the accounts specified in Clause 16.2(a)
(Financial information); and
(b) promptly if the Agent so requests (but no more often than
twice in a calendar year
(excluding the certificate under paragraph (a) above)),
a certificate signed by two of its directors on its behalf
certifying that no Default is outstanding
or, if a Default is outstanding, specifying the Default and the
steps, if any, being taken to
remedy it.
16.6 Authorisations
Each Borrower shall:-
(a) use all reasonable endeavours to obtain, maintain and
comply in all material respects
with the terms of; and
(b) (if requested) supply certified copies to the Agent of,
any authorisation required under any law or regulation to enable
it to perform its obligations
under, or for the validity or admissibility in evidence of, any
Finance Document.
16.7 Pari passu ranking
Each Borrower shall procure that its obligations under the
Finance Documents do and will rank
at least pari passu with all its other present and future
unsecured obligations, except for taxes,
national insurance contributions, local or water authority rates
and employee remuneration and
benefits which are mandatorily preferred by law applying to
companies generally or by the Act.
16.8 Negative pledge
(a) No Borrower shall, and YPG shall procure that no
Subsidiary will, create or permit to subsist
any Security Interest on any of its assets.
(b) (i) YPG shall not create or permit to subsist any
Security Interest on any of its shares in
or loans to YH; and
(ii) YH shall not create or permit to subsist any Security
Interest in any of its shares in or
loans to YEG.
(c) Paragraph (a) does not apply to Permitted Security
Interests or to Security Interests arising
under the Act.
16.9 Transactions similar to security
Neither YPG nor YH shall:-
(a) sell, transfer or otherwise dispose of any of its assets
on terms whereby it is or may be
leased to or re-acquired or acquired by a member of the Group or
any of its related
entities; or
(b) (except as permitted under Clause 16.10 (Disposals))
sell, transfer or otherwise
dispose of any of its receivables on recourse terms, except for
the discounting of bills
or notes in the ordinary course of trading,
in circumstances where the transaction is entered into primarily
as a method of raising finance
or of financing the acquisition of an asset.
16.10 Disposals
(a) YPG will not sell, transfer or otherwise dispose of or
cease to exercise direct control over any
of its shares in YH.
(b) YH will not sell, transfer or otherwise dispose of or
cease to exercise direct control over any of
its shares in YEG.
(c) Neither YPG nor YH will dispose of all or any material
part of its other assets.
(d) YEG shall not, and shall procure that no other Subsidiary
of YEG shall, either in a single
transaction or in a series of transactions, whether related or
not and whether voluntarily or
involuntarily, sell, transfer, grant or lease or otherwise
dispose of all or any substantial part of
the assets of YEG and its Subsidiaries.
Paragraphs (c) and (d) above do not apply to:
(i) sales, conveyances, transfers or other disposals in the
ordinary course of business on
arm's length terms or otherwise at market value; or
(ii) sales, conveyances, transfers or other disposals the
aggregate book value of which is at
the time of the final such disposal in any financial year 7.5 per
cent. or less of Adjusted
Share Capital and Reserves (less the Preferred Securities); or
(iii) disposals to another member of the Group provided that
such disposals shall only be
made to:
(A) another Borrower;
(B) a wholly owned Subsidiary of a Borrower;
(C) another person who immediately after such disposal
becomes a wholly owned
subsidiary of a Borrower; or
(D) another member of the Group if the interest of YEG in
that transferee is no
less than its interest in the transferor; or
(iv) disposals of assets in exchange for other assets similar
as to type and value or where
all or a substantial part of the net proceeds of such disposal
are used within 60 days of
the disposal (or such longer period as the Majority Banks may
agree) in the acquisition
of such assets; or
(v) disposals of cash raised or borrowed or temporary
investments representing surplus
funds; or
(vi) the expenditure of cash in the ordinary course of
business including, without limitation,
for the repayment of any debt or the acquisition of any asset; or
(vii) the payment of any dividend or distribution whatsoever
and whether extraordinary or
special in nature or otherwise, in each case, in cash or in
specie; or
(viii) disposals on normal commercial terms of old and/or
obsolete plant or equipment; or
(ix) any distribution of the surplus assets of a Subsidiary
(not being a Principal Subsidiary)
in a liquidation or winding up not involving insolvency; or
(x) disposals (with or without recourse) of receivables at
arm's length and on normal
commercial terms (or by way of securitisation or monetisation)
provided that:
(A) the majority of the proceeds from that disposal are used
to repay the Facilities
in the following order:
first, Facility A;
second, any other Loan owing by YPG;
third, any other Facility designated by YPG; and
(B) that disposal would not of itself be reasonably likely to
result in a breach of
YPG's obligations under Clause 16.17 (Financial covenants) either
at the time
of the disposal or following the disposal; or
(xi) the sale at arm's length of any of the shares in Ionica
PLC owned by YEG; or
(xii) the sale at arm's length or otherwise at market value of
the power generation assets
owned by members of the Group; or
(xiii) with the prior written consent of the Majority Banks.
16.11 Change of business
Unless the Agent (acting on the instructions of the Majority
Banks) otherwise agrees or the
change arises by operation of law, YPG shall not permit the Group
as a whole to make any
substantial change in the nature of its business as a distributor
and/or supplier of electricity
within its authorised area which, when taken together, would
account for more than 10 per
cent. of the consolidated gross assets and/or turnover of the
Group.
16.12 Restriction on Borrowings
(a) No member of the Group will incur or have outstanding any
Borrowings other than:
(i) under the Finance Documents;
(ii) for the purpose of refinancing the Facilities in full on
the date on which such
Borrowings are first utilised;
(iii) for the purpose of refinancing part of the Facility so
long as all utilisations of such
Borrowings shall be applied first to repay outstanding Facility A
Loans (and if any
portion of the Borrowings referred to above remains unused after
the Facility A Loans
have been repaid or prepaid in full, an amount of the Facility B
Commitments equal to
the amount of that portion shall be cancelled);
(iv) Borrowings owing by one member of the Group to another
member of the Group;
(v) Subordinated Debt;
(vi) in the case of YPG and its Subsidiaries, Borrowings
secured under paragraph (c) of the
definition of Permitted Security Interests up to the amount set
out in sub-
paragraph (c)(i) of that definition unless that Security Interest
is to be discharged under
sub-paragraph (c)(ii) of that definition;
(vii) in the case of YPG and its Subsidiaries, Borrowings under
any recourse disposal of
receivables where that disposal is permitted under Clause
16.10(d)(x) (Disposals);
(viii) Project Finance Borrowings;
(ix) in the case of YPG and its Subsidiaries (other than YEG
and its Subsidiaries) any
Borrowings existing at the date of this Agreement or any
refinancing of those
Borrowings, provided that the principal amount of those
Borrowings is not increased;
(x) with the prior written consent of the Majority Banks; or
(xi) any other Borrowings of YEG or any of its Subsidiaries in
an amount which, after
deducting Investments of YEG or any of its Subsidiaries do not
exceed in aggregate
(POUND)700,000,000 (including under the Finance Documents and the
YEG Facility).
(b) YH shall not guarantee any Borrowings of Yorkshire Power
Finance Limited.
16.13 Environmental Matters
The Borrowers will ensure that each member of the Group will:
(a) obtain all necessary Environmental Licences and comply in
all material respects with
(i) the terms and conditions of all Environmental Licences
applicable to it and (ii) all
other applicable Environmental Laws in each case where failure to
do so would have a
Material Adverse Effect;
(b) promptly upon receipt of the same, notify the Agent of
any claim, notice or other
communication served on it in respect of any alleged breach of or
corrective or
remedial obligation or liability under any Environmental Law
which would or would be
likely to or (in the case of an alleged breach), if
substantiated, would have a Material
Adverse Effect.
16.14 Company distributions etc.
Subject to:
(a) compliance with all applicable laws, directives and
consents (including, without
limitation, the Act and the conditions of the Licence) by YEG or,
as the case may be,
the relevant Subsidiary; and
(b) retention of cash by YEG or, as the case may be, the
relevant Subsidiary to meet its
projected cash requirements,
YEG shall not enter into any agreement prohibiting it from, and
YPG will use all reasonable
endeavours to procure that each other member of the Group does
distribute, lend or otherwise
transfer so as to be received directly or indirectly by any
Borrower, such cash from time to time
as may be required from time to time to meet and provide for any
Borrower's payment
obligations under the Finance Documents, save to the extent to
which funds for that purpose
are provided from another source.
16.15 Licence
(a) To the extent that there would otherwise be a Material
Adverse Effect, YEG shall, and shall
ensure that each Licence Holder shall, comply with all terms and
conditions of the Licence and
with the requirements of all laws, rules, regulations, orders and
other requirements for the time
being of the Secretary of State and the Director General
applicable to each Licence Holder with
which it is obliged to comply; and
(b) YEG will promptly notify the Agent of any amendments to
the Licence occurring after the date
of this Agreement (other than those of a minor and/or technical
nature).
16.16 Change of basis
If, at any time, YPG changes or proposes to change in any
material respect the basis upon
which the Group's audited annual consolidated accounts are
prepared (whether or not by reason
of a change in accounting standards or otherwise), then:-
(a) YPG shall promptly notify the Agent of the change or
proposed change;
(b) subject to paragraph (c) below, YPG shall calculate the
financial covenants under
Clause 16.17 (Financial covenants) on the basis of the accounting
standards used for
the Original Group Accounts and shall provide appropriate
calculations with the
certificates delivered under Clause 16.2(c) (Financial
information) to show the
reconciliations and adjustments that have been made as a result
of the change in
accounting standards; and
(c) if YPG so requests at any time:
(i) YPG and the Agent shall enter into discussions for a
period of not more than
45 days with a view to agreeing the amendments which would be
required to
be made to Clause 16.17 (Financial Covenants) to procure that, so
far as
possible, the Borrowers and the Banks are in no worse position
than they
would have been in if the change in accounting standards had not
occurred;
(ii) any agreement between YPG and the Agent under sub-
paragraph (i) above
shall be, with the prior consent of the Majority Banks, binding
on all the
Parties; and
(iii) if no agreement is reached under sub-paragraph (i) above,
then YPG's auditors
shall certify the amendments which would be required to be made
to this
Agreement to place YPG, the Borrowers and the Banks in the same
position
they would have been in if the change had not taken place; a
certificate of the
auditors in accordance with the above will, in the absence of
manifest error, be
binding on all the Parties.
16.17 Financial covenants
YPG shall procure that:
(a) the ratio of Debt of the Group to Capitalisation does not
at any time exceed 75 per
cent.; and
(b) EBITDA for any Relevant Period shall not be less than
2.00 times Net Interest Payable
for that Relevant Period.
16.18 Licence undertakings
YEG shall promptly supply to the Agent:
(a) copies of all notices or orders served on it by the
Director General or the Secretary of
State in exercise of the powers conferred on him by the Act to
the extent the same
might reasonably be expected to have a Material Adverse Effect;
(b) details of any references relating to it to the
Monopolies and Mergers Commission
after the date of this Agreement; and
(c) details of the exercise by the Secretary of State or the
Director General of the powers
conferred on them by the Fair Trading Xxx 0000, the Competition
Xxx 0000 and/or
Section 12 of the Act relating to it or any business carried on
by it and regulated
thereby.
17. DEFAULT
17.1 Events of Default
Each of the events set out in Clauses 17.2 (Non-payment) to 17.16
(Expropriation) (inclusive)
is an Event of Default (whether or not caused by any reason
whatsoever outside the control of
any Borrower or any other person).
17.2 Non-payment
A Borrower does not pay any amount payable by it under the
Finance Documents on the due
date at the place at and in the currency in which it is expressed
to be payable and, but only if
such failure is due solely to administrative error or technical
difficulties, such non payment is
not remedied within 3 Business Days.
17.3 Breach of other obligations
(a) YPG does not comply with the provisions of Clause 16.17
(Financial covenants).
(b) A Borrower does not comply with any provision of the
Finance Documents (other than those
referred to in paragraph (a) above or Clause 17.2 (Non-payment))
and such default, if capable
of remedy, is not remedied within 25 days after the earlier of
the date upon which that
Borrower became aware of the same and the date on which that
Borrower receives notice from
the Agent requiring remedy.
17.4 Misrepresentation
A representation, warranty or statement made or repeated in or in
connection with any Finance
Document or in any document delivered by or on behalf of a
Borrower under or in connection
with any Finance Document is incorrect in any respect when made
or deemed to be made or
repeated.
17.5 Cross-default
(a) Any Borrowings of a member of the Group are not paid when
due; or
(b) an event of default howsoever described occurs under any
document relating to Borrowings of
a member of the Group and any financier to which those Borrowings
are owed takes any step
to improve its commercial position, whether by charging a fee not
provided for in the original
document evidencing those Borrowings, or seeking more onerous
provisions in that document;
or
(c) any Borrowings of a member of the Group become
prematurely due and payable or are placed
on demand as a result of an event of default under the document
relating to those Borrowings,
and the aggregate principal amount of Borrowings or amounts
referred to in paragraphs (a) to
(c) (inclusive) above exceeds (POUND)15,000,000 or its equivalent
in any other currency.
17.6 Administration
(a) A Borrower or any Principal Subsidiary passes an
effective resolution to present an application
for an administration order; or
(b) an application for an administration order in relation to
a Borrower or a Principal Subsidiary is
presented to the court unless the application is being contested
in good faith on reasonable
grounds by appropriate proceedings; or
(c) an administration order is made in relation to a Borrower
or any Principal Subsidiary.
17.7 Insolvency
A Borrower or any Principal Subsidiary has any voluntary
arrangement proposed in relation to
it under Section 1 of the Insolvency Xxx 0000, or enters into any
other composition, scheme of
arrangement, compromise or arrangement involving such company and
its respective creditors
generally (other than for the purposes of reconstruction or
amalgamation or other similar
arrangement).
17.8 Insolvency proceedings
(a) A Borrower or any Principal Subsidiary passes an
effective resolution for its winding up other
than a resolution previously approved in writing by the Agent; or
(b) a petition for the winding up of a Borrower or any
Principal Subsidiary is presented to the
court and either:
(i) such company does not apply to the court within 30 days
after the presentation of such
petition requesting the court to refuse such petition; or
(ii) it does so apply but such petition is not refused by such
court within 60 days after such
application for the refusal of such petition or any such company
becomes subject to a
winding up order,
provided that nothing in this Clause 17.8 shall apply to a
solvent reconstruction, amalgamation
or reorganisation of a Principal Subsidiary.
17.9 Appointment of receivers and managers
Any liquidator, trustee in bankruptcy, compulsory manager,
receiver, administrative receiver,
administrator or the like is appointed in respect of a Borrower
or any Principal Subsidiary or
any material part of its assets or undertaking or the directors
of a Borrower or a Principal
Subsidiary request the appointment of a liquidator, trustee in
bankruptcy, compulsory manager,
receiver, administrative receiver, administrator or the like
(other than an appointment to which
the Agent has approved pursuant to Clause 17.8 (Insolvency
proceedings)).
17.10 Unlawfulness
It is or becomes unlawful for a Borrower to perform any of its
obligations under the Finance
Documents.
17.11 Licence
(a) Any modification (other than a modification which is of a
minor or technical nature) is made to
the terms and conditions of the Licence and such modification
would be expected to have a
Material Adverse Effect; or
(b) the Licence (excluding any second tier supply licence) is
surrendered by the Licence Holder or
is revoked by the Secretary of State or a notice from the
Secretary of State is given to that
effect in accordance with its terms or it otherwise ceases to be
in full force and effect and, in
each case, the Licence is not replaced on substantially similar
terms except where such
surrender, cessation or revocation has been agreed between the
Company and the Secretary of
State and consented to by the Majority Banks and provided that
the giving of notice pursuant to
paragraph 3 of Part 1 of the Licence shall not be deemed to
constitute the revocation of the
Licence.
17.12 Pooling and Settlement Agreement
Any notice requiring YEG to cease to be a party to the Pooling
and Settlement Agreement is
given to YEG under clause 66.1.3 or 66.2.2 of the Pooling and
Settlement Agreement, or YEG
otherwise ceases to be a party to that agreement and the same has
a Material Adverse Effect,
unless YEG or any of its Subsidiaries enters into arrangements
which replace the Pooling and
Settlement Agreement for electricity trading and settlement
within the electricity industry and
those replacement arrangements do not have a Material Adverse
Effect.
17.13 Compliance with the Act
YEG fails to comply with a final order (within the meaning
of Section 25 of the Act) or with a
provisional order (within the meaning of that section) which has
been confirmed under that
section (and not since been revoked) or any provisions of the Act
detailing the rights, powers,
authorities, obligations and duties of the Secretary of State or
the Director General or the
manner in or time at which they are to be exercised, are repealed
or amended in a manner
which has (or is likely to have) a Material Adverse Effect.
17.14 Ownership of YPG
More than 50 per cent. of the ordinary voting shares in the
capital of YPG cease to be owned,
directly or indirectly, by American Electric Power Company Inc.
or New Century Energies,
Inc. (or their respective wholly owned Subsidiaries) taken
together.
17.15 Ownership of YH and YEG
(a) YH is not or ceases to be a direct or indirect wholly
owned Subsidiary of YPG.
(b) YEG is not or ceases to be a direct or indirect wholly
owned Subsidiary of YH.
17.16 Expropriation
All or a substantial part of the assets of a Borrower shall be
seized, renationalised or
expropriated by any governmental authority.
17.17 Acceleration
On and at any time after the occurrence of an Event of Default
while the same is continuing,
unremedied or unwaived the Agent may (and, shall if so directed
by the Majority Banks), by
notice to each of the Borrowers:
(a) cancel the Total Commitments; and/or
(b) demand that all or part of the Loans, together with
accrued interest and all other
amounts accrued under this Agreement be immediately due and
payable, whereupon
they shall become immediately due and payable; and/or
(c) demand that all or part of the Loans be payable on
demand, whereupon they shall
immediately become payable on demand by the Agent acting on the
instructions of the
Majority Banks.
18. THE AGENT AND THE ARRANGERS
18.1 Appointment and duties of the Agent
(a) Each Finance Party (other than the Agent) irrevocably
appoints the Agent to act as its agent
under and in connection with the Finance Documents.
(b) Each Party appointing the Agent irrevocably authorizes
the Agent on its behalf to:
(i) perform the duties and to exercise the rights, powers and
discretions that are
specifically delegated to it under or in connection with the
Finance Documents,
together with any other incidental rights, powers and
discretions; and
(ii) execute each Finance Document expressed to be executed by
the Agent on that Party's
behalf.
(c) The Agent shall have only those duties which are
expressly specified in the Finance
Documents. Those duties are solely of a mechanical and
administrative nature.
18.2 Role of the Arrangers
Except as otherwise provided in the Finance Documents, the
Arrangers have no obligations of
any kind to any other Finance Party under or in connection with
any Finance Document.
18.3 Relationship
The relationship between the Agent and the other Finance Parties
is that of agent and principal
only. Nothing in this Agreement constitutes the Agent as trustee
or fiduciary for any other
Party or any other person and the Agent need not hold in trust
any moneys paid to it for a Party
or be liable to account for interest on those moneys.
18.4 Majority Banks' instructions
(a) The Agent will be fully protected if it acts in
accordance with the instructions of the Majority
Banks in connection with the exercise of any right, power or
discretion or any matter not
expressly provided for in the Finance Documents. Any such
instructions given by the Majority
Banks will be binding on all the Banks. In the absence of such
instructions the Agent may act
as it considers to be in the best interests of all the Banks.
(b) The Agent is not authorized to act on behalf of a Bank
(without first obtaining that Bank's
consent) in any legal or arbitration proceedings relating to any
Finance Document.
18.5 Delegation
The Agent may act under the Finance Documents through its
personnel and agents.
18.6 Responsibility for documentation
Neither the Agent nor the Arrangers are responsible to any other
Finance Party for:-
(a) the execution, genuineness, validity, enforceability or
sufficiency of any Finance
Document or any other document;
(b) the collectability of amounts payable under any Finance
Document; or
(c) the accuracy of any statements (whether written or oral)
made in or in connection with
any Finance Document (including the Information Memorandum).
18.7 Default
(a) The Agent is not obliged to monitor or enquire as to
whether or not a Default has occurred.
The Agent will not be deemed to have knowledge of the occurrence
of a Default. However, if
the Agent receives notice from a Party referring to this
Agreement, describing the Default and
stating that the event is a Default, it shall promptly notify the
Banks.
(b) The Agent may require the receipt of security
satisfactory to it whether by way of payment in
advance or otherwise, against any liability or loss which it will
or may incur in taking any
proceedings or action arising out of or in connection with any
Finance Document before it
commences these proceedings or takes that action.
18.8 Exoneration
(a) Without limiting paragraph (b) below, the Agent will not
be liable to any other Finance Party
for any action taken or not taken by it under or in connection
with any Finance Document,
unless directly caused by its gross negligence or wilful
misconduct.
(b) No Party may take any proceedings against any officer,
employee or agent of the Agent in
respect of any claim it might have against the Agent or in
respect of any act or omission of any
kind (including gross negligence or wilful misconduct) by that
officer, employee or agent in
relation to any Finance Document.
18.9 Reliance
The Agent may:-
(a) rely on any notice or document believed by it to be
genuine and correct and to have
been signed by, or with the authority of, the proper person;
(b) rely on any statement made by a director or employee of
any person regarding any
matters which may reasonably be assumed to be within his
knowledge or within his
power to verify; and
(c) engage, pay for and rely on legal or other professional
advisers selected by it (including
those in the Agent's employment and those representing a Party
other than the Agent).
18.10 Credit approval and appraisal
Without affecting the responsibility of any Borrower for
information supplied by it or on its
behalf in connection with any Finance Document, each Bank
confirms that it:-
(a) has made its own independent investigation and assessment
of the financial condition
and affairs of each 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 Agent or the Arrangers in connection with any Finance
Document; and
(b) will continue to make its own independent appraisal of
the creditworthiness of each
Borrower and its related entities while any amount is or may be
outstanding under the
Finance Documents or any Commitment is in force.
18.11 Information
(a) The Agent shall promptly forward to the person concerned
the original or a copy of any
document which is delivered to the Agent by a Party for that
person.
(b) The Agent shall promptly supply a Bank with a copy of
each document received by the Agent
under Clause 4 (Conditions precedent) upon the request and at the
expense of that Bank.
(c) Except where this Agreement specifically provides
otherwise, the Agent is not obliged to
review or check the accuracy or completeness of any document it
forwards to another Party.
(d) Except as provided above, the Agent has no duty:-
(i) either initially or on a continuing basis to provide any
Bank with any credit or other
information concerning the financial condition or affairs of any
Borrower or any
related entity of any Borrower whether coming into its possession
before, on or after
the date of this Agreement; or
(ii) unless specifically requested to do so by a Bank in
accordance with a Finance
Document, to request any certificates or other documents from any
Borrower.
18.12 The Agent and the Arrangers individually
(a) If it is also a Bank, each of the Agent and each Arranger
has the same rights and powers under
this Agreement as any other Bank and may exercise those rights
and powers as though it were
not the Agent or an Arranger.
(b) Each of the Agent and each Arranger may:-
(i) carry on any business with a Borrower or its related
entities;
(ii) act as agent or trustee for, or in relation to any
financing involving, a Borrower or its
related entities; and
(iii) retain any profits or remuneration in connection with its
activities under this
Agreement or in relation to any of the foregoing.
(c) In acting as the Agent, the agency division of the Agent
will be treated as a separate entity from
its other divisions and departments. Any information acquired by
the Agent which, in its
opinion, is acquired by it otherwise than in its capacity as the
Agent may be treated as
confidential by the Agent and will not be deemed to be
information possessed by the Agent in
its capacity as such.
(d) Each Borrower irrevocably authorizes the Agent to
disclose to the other Finance Parties any
information which is received by it in its capacity as the Agent.
(e) The Agent may deduct from any amount received by it for
the Banks pro rata any unpaid fees,
costs and expenses of the Agent incurred by it in connection with
the Finance Documents.
18.13 Indemnities
(a) Without limiting the liability of any Borrower under the
Finance Documents, each Bank shall
forthwith on demand indemnify the Agent for that Bank's
proportion of any liability or loss
incurred by the Agent in any way relating to or arising out of
its acting as the Agent, except to
the extent that the liability or loss arises directly from the
Agent's gross negligence or wilful
misconduct.
(b) A Bank's proportion of the liability or loss set out in
paragraph (a) above is the proportion
which its participation in the Loans (if any) bear to all the
Loans outstanding on the date of the
demand. However, if there are no Loans outstanding on the date
of demand, then the
proportion will be the proportion which its Commitment bears to
the Total Commitments at the
date of demand or, if the Total Commitments have been cancelled,
bore to the Total
Commitments immediately before being cancelled.
18.14 Compliance
(a) The Agent may refrain from doing anything which might, in
its opinion, constitute a breach of
any law or regulation or be otherwise actionable at the suit of
any person, and may do anything
which, in its opinion, is necessary or desirable to comply with
any law or regulation of any
jurisdiction.
(b) Without limiting paragraph (a) above, the Agent need not
disclose any information relating to
any Borrower or any of its related entities if the disclosure
might, in the opinion of the Agent,
constitute a breach of any law or regulation or any duty of
secrecy or confidentiality or be
otherwise actionable at the suit of any person.
18.15 Resignation of Agent
(a) Notwithstanding its irrevocable appointment, the Agent
may resign by giving notice to the
Banks and the Borrowers, in which case the Agent may forthwith
appoint one of its Affiliates
as successor Agent or, failing that, the Majority Banks may
(after consultation with YPG)
appoint a successor Agent.
(b) If the appointment of a successor Agent is to be made by
the Majority Banks but they have not,
within 30 days after notice of resignation, appointed a successor
Agent which accepts the
appointment, the retiring Agent may (after consultation with YPG)
appoint a successor Agent.
(c) The resignation of the Agent and the appointment of any
successor Agent will both become
effective only upon the successor Agent notifying all the Parties
that it accepts the appointment.
On giving the notification, the successor Agent will succeed to
the position of the Agent and the
term "Agent" will mean the successor Agent.
(d) The retiring Agent shall, at its own cost, make available
to the successor Agent such documents
and records and provide such assistance as the successor Agent
may reasonably request for the
purposes of performing its functions as the Agent under this
Agreement.
(e) Upon its resignation becoming effective, this Clause 18
shall continue to benefit the retiring
Agent in respect of any action taken or not taken by it under or
in connection with the Finance
Documents while it was the Agent, and, subject to paragraph (d)
above, it shall have no further
obligation under any Finance Document.
(f) The Majority Banks may, by notice to the Agent, require
it to resign in accordance with
paragraph (a) above. In this event, the Agent shall resign in
accordance with paragraph (a)
above but it shall not be entitled to appoint one of its
Affiliates as successor Agent.
18.16 Banks
(a) The Agent may treat each Bank as a Bank, entitled to
payments under this Agreement and as
acting through its Facility Office(s) until it has received not
less than five Business Days notice
from a Bank to the contrary.
(b) Each Bank, on the date on which it becomes a party to
this Agreement, represents to the Agent
and the Borrowers that it is:
(i) either:
(A) not resident in the United Kingdom for United Kingdom tax
purposes; or
(B) a "bank" as defined in section 840A of the Income and
Corporation Taxes Act
1988 and resident in the United Kingdom; and
(ii) beneficially entitled to the principal and interest
payable by the Agent to it under this
Agreement,
and shall forthwith notify the Agent and YPG if either
representation ceases to be correct.
19. FEES
19.1 Arrangement fee
YPG shall, on the earlier of the date falling three Business Days
from the date of this
Agreement and the first Drawdown Date, pay to the Arrangers an
arrangement fee in the
amount agreed in the relevant Fee Letter. This fee shall be
distributed by the Arrangers among
the Banks in accordance with the arrangements agreed by the
Arrangers with the Banks prior to
the date of this Agreement.
19.2 Agent's fee
YPG shall pay to the Agent for its own account an agency fee in
the amount and on the dates
agreed in the relevant Fee Letter. The agency fee is payable for
so long as any amount is or
may be outstanding under this Agreement or any Commitment is in
force.
19.3 Commitment fee
(a) YPG shall pay to the Agent for each Bank a commitment fee
in the amount of:-
(i) 0.075 per cent. per annum on the undrawn, uncancelled
amount of that Bank's Facility
A Commitment during the Facility A Commitment Period; plus
(ii) 0.13 per cent. per annum (or, if Debt is less than 65 per
cent. of Capitalisation, 0.12
per cent. per annum) on the undrawn, uncancelled amount of that
Banks Facility C
Commitment during the Facility C Commitment Period.
(b) Accrued commitment fee is payable quarterly in arrear.
Accrued commitment fee shall also
payable to the Agent for the relevant Bank on the cancelled
amount of its Commitment at the
time any cancellation comes into effect.
(c) Any change in the commitment fee shall take effect at the
same time as any change in the
Margin under Clause 9.4 (Margin adjustment).
19.4 VAT
Any fee referred to in this Clause 19 is exclusive of any value
added tax or any other tax which
might be chargeable in connection with that fee. If any value
added tax or other tax is so
chargeable, it shall be paid by a Borrower at the same time as it
pays the relevant fee.
20. EXPENSES
20.1 Initial and special costs
YPG shall, within 10 days of a claim being made , pay the Agent
and the Arrangers the amount
of all reasonable costs and expenses (including, for paragraph
(a) below only, legal fees only
up to a maximum of as set out in the relevant Fee Letter)
properly incurred by any of them in
connection with:
(a) the negotiation, preparation, printing and execution of:
(i) this Agreement and any other documents referred to in
this Agreement;
(ii) any other Finance Document (other than a Novation
Certificate) executed after
the date of this Agreement; and
(b) any amendment, waiver, consent or suspension of rights
(or any proposal for any of the
foregoing) requested by or on behalf of the Borrower or, in the
case of Clause 2.3
(Change of currency), the Agent, and relating to a Finance
Document or a document
referred to in any Finance Document.
20.2 Enforcement Costs
The Borrowers shall, within 10 days of demand, pay to each
Finance Party the amount of all
costs and expenses (including legal fees) incurred by it in
connection with the enforcement of,
or in preservation of any rights under, any Finance Document.
21. STAMP DUTIES
The Borrowers shall within 10 Business Days of a demand pay to a
Finance Party the amount
of any liability it incurs in respect of any United Kingdom
stamp, registration and similar tax
which is or becomes payable in connection with the entry into,
performance or enforcement of
any Finance Document.
22. INDEMNITIES
22.1 Currency indemnity
(a) If a Finance Party receives an amount in respect of a
Borrower's liability under the Finance
Documents or if that liability is converted into a claim, proof,
judgment or order in a currency
other than the currency (the "contractual currency") in which the
amount is expressed to be
payable under the relevant Finance Document:
(i) that Borrower shall indemnify that Finance Party as an
independent obligation against
any loss or liability arising out of or as a result of the
conversion;
(ii) if the amount received by that Finance Party, when
converted into the contractual
currency at a market rate in the usual course of its business is
less than the amount
owed in the contractual currency, that Borrower shall forthwith
on demand pay to that
Finance Party an amount in the contractual currency equal to the
deficit; and
(iii) that Borrower shall pay to that Finance Party forthwith
on demand any exchange costs
and taxes payable in connection with any such conversion.
(b) Each Borrower waives any right it may have in any
jurisdiction to pay any amount under the
Finance Documents in a currency other than that in which it is
expressed to be payable.
22.2 Other indemnities
(a) A Borrower shall, within 10 Business Days of a demand pay
to a Finance Party the amount of
any loss or liability which that Finance Party incurs as a
consequence of:
(i) the occurrence of any Event of Default;
(ii) the operation of Clause 17.17 (Acceleration); or
(iii) (other than by reason of negligence or default by a
Finance Party) a Loan not being
made after that Borrower has delivered a Request or a Loan (or
part of a Loan) not
being prepaid in accordance with a notice of prepayment.
That Borrower's liability in each case includes any loss or
expense on account of funds
borrowed, contracted for or utilised to fund any amount payable
under any Finance Document,
any amount repaid or prepaid or any Loan but excludes any loss of
margin.
(b) If any Finance Party receives or recovers any payment of
principal of a Loan or of an overdue
amount other than on the last day of the Interest Period relative
to that Loan or amount so
received or recovered, that Finance Party shall calculate the
difference between:
(i) the additional interest (excluding the Margin and
Mandatory Costs) which would have
been payable on the principal so received or recovered had it
been received or
recovered on the last day of the relevant Interest Period; and
(ii) the amount of interest which would have been payable to
that Finance Party on the last
day of that Interest Period in respect of the principal so
received or recovered if the
principal so received or recovered had been placed on deposit by
that Finance Party
earning interest at the Applicable Rate from (and including) the
Business Day of
receipt of that amount up to (but excluding) the last day of
applicable Interest Period.
If (i) is greater than (ii) then the Borrower to whom the
relevant Loan was made shall, within
five Business Days of a demand from the relevant Finance Party,
pay to that Finance Party an
amount equal to the difference.
23. EVIDENCE AND CALCULATIONS
23.1 Accounts
Accounts maintained by a Finance Party in connection with this
Agreement are prima facie
evidence of the matters to which they relate.
23.2 Certificates and determinations
Any certification or determination by a Finance Party of a rate
or amount under this Agreement
is prima facie evidence of the matters to which it relates.
23.3 Calculations
Interest (including any applicable Mandatory Cost), default
interest payable pursuant to Clause
9.3 (Default interest) and the fee payable under Clause 19.3
(Commitment fee) accrue from
day to day and are calculated on the basis of the actual number
of days elapsed and a year of
365 days.
24. AMENDMENTS AND WAIVERS
24.1 Procedure
(a) Subject to Clause 25.2 (Exceptions), any term of the
Finance Documents may be amended or
waived with the agreement of each of the Borrowers and the
Majority Banks. The Agent may
effect, on behalf of any Finance Party, an amendment or waiver
permitted under this Clause.
(b) The Agent shall promptly notify the other Parties of any
amendment or waiver effected under
paragraph (a) above, and any such amendment or waiver shall be
binding on all the Parties.
24.2 Exceptions
(a) An amendment or waiver which relates to:-
(i) the definition of "Majority Banks" in Clause 1.1
(Definitions);
(ii) an extension of the date for, or a decrease in an amount
or a change in the currency of,
any payment to that Bank under the Finance Documents (including
the Margin and any
fee payable under Clause 20.3 (Commitment Fee));
(iii) an increase in that Bank's Commitment;
(iv) a term of a Finance Document which expressly requires the
consent of that Bank; or
(v) Clause 2.2 (Nature of a Finance Party's rights and
obligations), Clause 25.1 (Transfers
by the Borrower), Clause 28 (Pro rata sharing) or this Clause 24,
is not binding unless all the Banks agree to it.
(b) An amendment or waiver which relates to the rights and/or
obligations of the Agent may not be
effected without the agreement of the Agent.
24.3 Waivers and remedies cumulative
The rights of each Finance Party under the Finance Documents:-
(a) may be exercised as often as necessary;
(b) are cumulative and not exclusive of its rights under the
general law; and
(c) may be waived only in writing and specifically.
Delay in exercising or non-exercise of any such right is not a
waiver of that right.
25. CHANGES TO THE PARTIES
25.1 Transfers by Borrowers
No Borrower may assign, transfer, novate or dispose of any of, or
any interest in, its rights
and/or obligations under the Finance Documents.
25.2 Transfers by Banks
(a) A Bank (the "Existing Bank") may, subject to paragraph
(b) below, at any time assign,
transfer or novate any of its Commitment and/or any of its rights
and/or obligations under this
Agreement to another bank or financial institution (the "New
Bank").
(b) (i) After the Syndication Period, a transfer of a
Commitment must be in a minimum
amount of at least (POUND)5,000,000;
(ii) no transfer of a Commitment shall take place unless the
Existing Bank simultaneously
transfers to the New Bank the same proportion of each other
Commitment and of its
commitment under the YEG Facility; and
(iii) the prior consent of YPG is required for any such
assignment, transfer or novation,
unless the New Bank is another Bank or an Affiliate of a Bank,
provided that no
consent of YPG is required during the Syndication Period if YPG
has been consulted
by the Arrangers on the approach to that New Bank.
(c) A transfer of obligations will be effective only if
either:-
(i) the obligations are novated in accordance with Clause
25.3 (Procedure for novations);
or
(ii) the New Bank confirms to the Agent and the Borrowers that
it undertakes to be bound
by the terms of this Agreement as a Bank in form and substance
satisfactory to the
Agent. On the transfer becoming effective in this manner the
Existing Bank shall be
relieved of its obligations under this Agreement to the extent
that they are transferred
to the New Bank.
(d) No Bank shall sub-participate any of its obligations
under this Agreement without the prior
written consent of YPG.
(e) On each occasion an Existing Bank assigns, transfers or
novates any of its Commitment and/or
any of its rights and/or obligations under this Agreement (other
than under the Novation
Agreement), the New Bank shall, on the date the assignment,
transfer and/or novation takes
effect, pay to the Agent for its own account a fee of (POUND)750.
(f) An Existing Bank is not responsible to a New Bank for:-
(i) the execution, genuineness, validity, enforceability or
sufficiency of any Finance
Document or any other document;
(ii) the collectability of amounts payable under any Finance
Document; or
(iii) the accuracy of any statements (whether written or oral)
made in or in connection with
any Finance Document.
(g) Each New Bank confirms to the Existing Bank and the other
Finance Parties that it:-
(i) has made its own independent investigation and assessment
of the financial condition
and affairs of each 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 Bank in connection with any Finance Document; and
(ii) will continue to make its own independent appraisal of
the creditworthiness of each
Borrower and its related entities while any amount is or may be
outstanding under the
Finance Documents or any Commitment is in force.
(h) Nothing in any Finance Document obliges an Existing Bank
to:-
(i) accept a re-transfer from a New Bank of any of the rights
and/or obligations assigned,
transferred or novated under this Clause; or
(ii) support any losses incurred by the New Bank by reason of
the non-performance by any
Borrower of its obligations under the Finance Documents or
otherwise.
(i) Any reference in this Agreement to a Bank includes a New
Bank, but excludes a Bank if no
amount is or may be owed to or by that Bank under this Agreement
and its Commitment has
been cancelled or reduced to nil.
25.3 Procedure for novations
(a) A novation is effected if:-
(i) the Existing Bank and the New Bank deliver to the
Facility Agent a duly completed
Novation Certificate and the Agent executes it; or
(ii) a Novation Agreement is executed by all the parties to
it.
(b) Each Party (other than the Existing Bank and the New
Bank) irrevocably authorizes the Agent
to execute any duly completed Novation Certificate on its behalf.
(c) To the extent that they are expressed to be the subject
of the novation in the Novation
Certificate or Novation Agreement
(i) the Existing Bank and the other Parties (the "existing
Parties") will be released from
their obligations to each other (the "discharged obligations");
(ii) the New Bank and the existing Parties will assume
obligations towards each other
which differ from the discharged obligations only insofar as they
are owed to or
assumed by the New Bank instead of the Existing Bank;
(iii) the rights of the Existing Bank against the existing
Parties and vice versa (the
"discharged rights") will be cancelled; and
(iv) the New Bank and the existing Parties will acquire rights
against each other which
differ from the discharged rights only insofar as they are
exercisable by or against the
New Bank instead of the Existing Bank,
all on the date of execution of the Novation Certificate or
Novation Agreement by the Agent or,
if later, the date specified in the Novation Certificate or
Novation Agreement.
25.4 Reference Banks
If a Reference Bank (or, if a Reference Bank is not a Bank, the
Bank of which it is an Affiliate)
ceases to be a Bank, the Agent shall (in consultation with the
Borrowers) appoint another Bank
or an Affiliate of a Bank to replace that Reference Bank.
25.5 Register
The Agent shall keep a register of all the Parties and shall
supply any other Party (at that
Party's expense) with a copy of the register on request.
26. DISCLOSURE OF INFORMATION
Any information supplied to a Finance Party pursuant to or in
connection with this Agreement
shall be held in confidence and shall not be disclosed by it to
any person (other than an Affiliate
of that Finance Party) without the prior written consent of the
Borrowers except:
(a) to that Finance Party's legal or other professional
advisers to the extent required for the
purposes of protecting its rights hereunder or by law or
regulation or pursuant to
applicable reporting requirements or any order of any court or to
bank supervisory
authorities or examining authorities unless it is or becomes a
matter of public
knowledge otherwise than as a result of a breach by it of its
obligations hereunder; or
(b) by the Arrangers to a financial institution during the
Syndication Period in connection
with the syndication of the Facilities, provided that YPG has
been consulted by the
Arrangers on the approach to that financial institution.
27. SET-OFF
A Finance Party may set off any matured obligation owed by
a Borrower under this Agreement
(to the extent beneficially owned by that Finance Party) against
any credit balance owed by that
Finance Party to a Borrower, regardless of the place of payment,
booking branch or currency
of either obligation. If the obligations are in different
currencies, a Finance Party may convert
either obligation at a market rate of exchange in its usual
course of business for the purpose of
the set-off.
28. PRO RATA SHARING
28.1 Redistribution
If any amount owing by a Borrower under the Finance Documents to
a Finance Party (the
"recovering Finance Party") is discharged by payment, set-off or
any other manner other than
through the Agent in accordance with Clause 10 (Payments) (a
"recovery"), then:-
(a) the recovering Finance Party shall, within three Business
Days, notify details of the
recovery to the Agent;
(b) the Agent shall determine whether the recovery is in
excess of the amount which the
recovering Finance Party would have received had the recovery
been received by the
Agent and distributed in accordance with Clause 10 (Payments);
(c) subject to Clause 28.3 (Exception), the recovering
Finance Party shall, within three
Business Days of demand by the Agent, pay to the Agent an amount
(the
"redistribution") equal to the excess;
(d) the Agent shall treat the redistribution as if it were a
payment by the Borrower
concerned under Clause 10 (Payments) and shall pay the
redistribution to the Finance
Parties (other than the recovering Finance Party) in accordance
with Clause 10.7
(Partial Payments); and
(e) after payment of the full redistribution, the recovering
Finance Party will be
subrogated to the portion of the claims paid under paragraph (d)
above, and that
Borrower will owe the recovering Finance Party a debt which is
equal to the
redistribution, immediately payable and of the type originally
discharged.
28.2 Reversal of redistribution
If under Clause 28.1 (Redistribution):-
(a) a recovering Finance Party must subsequently return a
recovery, or an amount
measured by reference to a recovery, to a Borrower; and
(b) the recovering Finance Party has paid a redistribution in
relation to that recovery,
each Finance Party shall, within three Business Days of demand by
the recovering Finance
Party through the Agent, reimburse the recovering Finance Party
all or the appropriate portion
of the redistribution paid to that Finance Party together with
interest on the amount to be
returned to the recovering Finance Party for the period whilst it
held the re-distribution.
Thereupon the subrogation in Clause 28.1(e) (Redistribution) will
operate in reverse to the
extent of the reimbursement.
28.3 Exceptions
(a) A recovering Finance Party need not pay a redistribution
to the extent that it would not, after
the payment, have a valid claim against the Borrower concerned in
the amount of the
redistribution pursuant to Clause 28.1(e) (Redistribution).
(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
proceedings, if the other Finance Party had an opportunity to
participate in those legal
proceedings but did not do so or did not take separate legal
proceedings.
29. SEVERABILITY
If a provision of any Finance Document is or becomes illegal,
invalid or unenforceable in any
jurisdiction, that shall not affect:
(a) the validity or enforceability in that jurisdiction of
any other provision of the Finance
Documents; or
(b) the validity or enforceability in other jurisdictions of
that or any other provision of the
Finance Documents.
30. COUNTERPARTS
This Agreement 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 Agreement.
31. NOTICES
31.1 Giving of notices
All notices or other communications under or in connection with
this Agreement shall be given
in writing or by telex or facsimile. Any such notice will be
deemed to be given as follows:
(a) if in writing, when delivered;
(b) if by 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
(c) if by facsimile, when received,
provided that any notice or communication to be made hereunder
shall only be effective when
received and then only if the same is expressly marked for the
attention of the department or
office identified in Clause 31.2 (Addresses for notices) below.
However, a notice given in accordance with the above but received
on a non-working day or
after business hours in the place of receipt will only be deemed
to be given on the next working
day in that place.
31.2 Addresses for notices
(a) The address, telex number and facsimile number of each
Party (other than the Borrowers and
the Agent) for all notices under or in connection with the
Finance Documents are:-
(i) those notified by that Party for this purpose to the
Agent on or before it becomes a
Party; or
(ii) any other notified by that Party for this purpose to the
Agent by not less than five
Business Days notice.
(b) The address, telex number and facsimile number of YPG, YH
and YEG are:
Yorkshire Power Group Limited
Xxxxxxxx Xxxx
Xxxxxxxxx
Xxxxx XX00 0XX
Telex: 55128
Facsimile: 0000 000 0000
Telephone: 0000 000 0000
Attention: Xxxx Xxxxxxxxx
or such other as YPG, YH or YEG (as appropriate) may notify to
the other Parties by not less
than five Business Days notice.
(c) The address, telex number and facsimile number of the
Agent are:
000 Xxxxxx
Xxxxxx
XX0X 0XX
Telex: 299831 CIBLA
Facsimile: 0000 000 0000/3
Telephone: [0000 000 0000
Attention: Loans Agency
or such other as the Agent may notify to the other Parties by not
less than five Business Days'
notice.
(d) All notices to or from a Borrower shall be sent through
the Agent.
(e) The Agent shall, promptly upon request from any Party,
give to that Party the address, telex
number or facsimile number of any other party applicable at the
time for the purposes of this
Clause.
32. GOVERNING LAW
This Agreement is governed by English law.
This Agreement has been entered into on the date stated at the
beginning of this Agreement.
SCHEDULE 1
BANKS AND COMMITMENTS
Commitments
Banks
Facility A
Facility B
Facility C
(POUND)
(POUND)
(POUND)
Citibank, N.A.
15,423,197.50
13,366,771.17
5,141,065.82
Deutsche Bank AG London
15,423,197.49
13,366,771.17
5,141,065.83
The Bank of Tokyo-Mitsubishi, Ltd.
12,931,034.48
11,206,896.55
4,310,344.83
Bayerische Landesbank Girozentrale
12,931,034.48
11,206,896.55
4,310,344.83
Den Danske Bank Aktieselskab
12,931,034.48
11,206,896.55
4,310,344.83
Dresdner Bank AG London Branch
12,931,034.48
11,206,896.55
4,310,344.83
Midland Bank plc
12,931,034.48
11,206,896.55
4,310,344.83
National Westminster Bank Plc
12,931,034.48
11,206,896.55
4,310,344.83
The Toronto-Dominion Bank
12,931,034.48
11,206,896.55
4,310,344.83
The Bank of New York
9,545,454.55
8,272,727.27
3,181,818.18
Barclays Bank PLC
9,545,454.55
8,272,727.27
3,181,818.18
NationsBank, N.A.
9,545,454.55
8,272,727.27
3,181,818.18
Total Commitments
(POUND)150,000,000
(POUND)130,000,000
(POUND)50,000,000
SCHEDULE 2
CONDITIONS PRECEDENT DOCUMENTS
1. A copy of the memorandum and articles of association and
certificate of incorporation of each
Borrower, such memorandum in the case of YH to have been amended
to give YH the express
power to borrow.
2. A copy of a resolution of the board of directors of each
Borrower:
(i) approving the terms of, and the transactions contemplated
by, this Agreement and
resolving that it execute this Agreement;
(ii) authorising a specified person or persons to execute this
Agreement on its behalf; and
(iii) authorising a specified person or persons, on its behalf,
to sign and/or despatch all
documents and notices to be signed and/or despatched by it under
or in connection with
this Agreement.
3. A specimen of the signature of each person authorised by
the resolution referred to in
paragraph 2 above.
4. A certificate of a director of each Borrower confirming
that the borrowing by it of the
maximum amount entitled to be borrowed by it under this Agreement
would not cause any
borrowing limit binding on it to be exceeded.
5. A certificate of an Authorised Signatory of each Borrower
certifying that each copy document
supplied by that Borrower or on its behalf 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.
6. A legal opinion of Xxxxxxxx Chance, legal advisers to
the Arrangers.
SCHEDULE 3
CALCULATION OF THE MANDATORY COST
(a) The Mandatory Cost for a Loan for each of its Interest
Periods is the rate determined by the
Agent to be equal to the arithmetic mean (rounded upward, if
necessary, to four decimal
places) of the respective rates notified by each of the Reference
Banks to the Agent and
calculated in accordance with the following formulae:
in relation to a Loan denominated in sterling:
BY + S(Y-Z) + F x 0.01 % per annum = Mandatory Cost
100-(B + S)
in relation to any other Loan:
F x 0.01 % per annum = Mandatory Cost
300
where on the day of application of the formula:
B is the percentage of the Reference Bank's eligible
liabilities (in excess of any stated
minimum) which the Bank of England requires the Reference Bank to
hold on a non-
interest-bearing deposit account in accordance with its cash
ratio requirements;
Y is the rate at which sterling deposits are offered by the
Reference Bank to leading
banks in the London interbank market at or about 11.00 a.m. on
that day for the
relevant period;
S is the percentage of the Reference Bank's eligible
liabilities which the Bank of England
requires the Reference Bank to place as a special deposit;
Z is the interest rate per annum allowed by the Bank of
England on special deposits; and
F is the charge payable by the Reference Bank to the
Financial Services Authority under
paragraph 2.02 or 2.03 (as appropriate) of the Fees Regulations
(or any succeeding
provisions to those paragraphs) (but where for this purpose, any
minimum amount for
the charge will be deemed to be zero) expressed in pounds per
(POUND)1 million of the fee
base of the Reference Bank.
(b) For the purposes of this Schedule 3:
(i) "eligible liabilities" and "special deposits" have the
meanings given to them at the time
of application of the formula by the Bank of England; and
(ii) "fee base" has the meaning given to it in the Fees
Regulations;
(iii) "Fees Regulations" means:-
(1) prior to 31st March, 1999, the Banking Supervision (Fees)
Regulations 1998;
and
(2) on and after 31st March, 1999, any regulations governing
the payment of fees
for banking supervision.
(ii) "relevant period" in relation to each Interest Period,
means:
(A) if it is three months or less, that Interest Period; or
(B) if it is more than three months, each successive period
of three months and any
necessary shorter period comprised in that Interest Period.
(c) In the application of the formula, B, Y, S and Z are
included in the formula as figures and not
as percentages, e.g. if B = 0.5% and Y = 15%, BY is calculated as
0.5 x 15.
(d) If a Reference Bank does not supply a rate to the Agent,
the applicable Mandatory Cost will be
determined on the basis of the rate(s) supplied by the remaining
Reference Banks.
(e) (i) The formula is applied on the first day of each
relevant period comprised in the
relevant Interest Period.
(ii) Each rate calculated in accordance with the formula is,
if necessary, rounded upward
to four decimal places.
(f) If the Agent determines that a change in circumstances
has rendered, or will render, the formula
inappropriate, the Agent (after consultation with the Banks)
shall notify the Company of the
manner in which the Mandatory Cost will subsequently be
calculated which shall (so far as
practicable) leave the Banks and the Borrower in no better or
worse position that they would
have been in if the relevant change in circumstances had not
occurred. The manner of
calculation so notified by the Agent shall, in the absence of
manifest error, be binding on all the
Parties.
SCHEDULE 4
FORM OF REQUEST
To: [ ]
From[ ]
Date: [ ]
YORKSHIRE POWER GROUP LIMITED AND OTHERS - (POUND)330,000,000
Credit Agreement dated [
], 1998
1. We wish to borrow a Loan as follows:
(a) Drawdown Date: [
]
(b) Facility: [A/B/C]*
(c) Amount: (POUND)[
]
(d) First Interest Period: [
]/
alternative Interest Period: [
]**
(e) Payment Instructions: [
].
2. We confirm that each condition specified in Clause 4.3
(Further conditions precedent) is
satisfied on the date of this Request.
By:
[ ]
Authorised Signatory
SCHEDULE 5
PART I
FORM OF NOVATION CERTIFICATE
To: CITIBANK INTERNATIONAL plc as Agent
From: [THE EXISTING BANK] and [THE NEW BANK] Date: [ ]
YORKSHIRE POWER GROUP LIMITED and others
(POUND)330,000,000 Credit Agreement dated [
], 1998
We refer to Clause 25.3 (Procedure for novations).
1. We [ ] (the
"Existing Bank") and [ ]
(the
"New Bank") agree to the Existing Bank and the New Bank novating
all the Existing Bank's
Commitment (or part) rights and obligations referred to in the
Schedule in accordance with
Clause 25.3 (Procedure for novations).
2. The specified date for the purposes of Clause 25.3(c)
(Procedure for novations) is [date of
novation].
3. The Facility Office and address for notices of the New
Bank for the purposes of Clause 31.2
(Addresses for notices) are set out in the Schedule.
4. This Novation Certificate is governed by English law.
THE SCHEDULE
Commitment/rights and obligations to be novated
[Insert relevant details]
[New Bank]
[Facility Office] [Address for notices]
[Existing Bank] [New Bank] CITIBANK INTERNATIONAL plc
By: By: By:
Date: Date: Date:
PART II
FORM OF NOVATION AGREEMENT
NOVATION AGREEMENT
DATED [ ]
relating to a (POUND)330,000,000 Revolving Credit and Term Loan
Facility
for
YORKSHIRE POWER GROUP LIMITED
YORKSHIRE HOLDINGS PLC
and
YORKSHIRE ELECTRICITY GROUP PLC
arranged by
CITIBANK, N.A.
and
DEUTSCHE BANK AG LONDON
XXXXX & XXXXX
London
THIS AGREEMENT is dated [ ] between:
(1) YORKSHIRE POWER GROUP LIMITED, YORKSHIRE HOLDINGS PLC and
YORKSHIRE ELECTRICITY GROUP PLC (each a "Company");
(2) CITIBANK, N.A. and DEUTSCHE BANK AG LONDON (in this
capacity the "Arrangers");
(3) CITIBANK, N.A. and DEUTSCHE BANK AG LONDON as the Banks
party to the Credit
Agreement (as defined below) as at the date of this Agreement
(the "Existing Banks");
(4) THE FINANCIAL INSTITUTIONS listed in Schedule 1 as the
banks who wish to accede to
the Credit Agreement as Banks (the "New Banks"); and
(5) CITIBANK INTERNATIONAL plc as agent (in this capacity the
"Agent").
IT IS AGREED as follows:
1. INTERPRETATION
1.1 Definitions
In this Agreement, unless the contrary intention appears or the
context otherwise requires:
"Credit Agreement"
means the Credit Agreement dated [ ], 1998 between the
Companies, the Arrangers, the
Existing Banks and the Agent.
"Effective Date"
means [ ].
1.2 Incorporation of Credit Agreement definitions
Terms defined in the Credit Agreement shall, unless the contrary
intention appears or the
context otherwise requires, have the same meaning in this
Agreement.
1.3 Incorporation
Clauses 1.2 (Construction), 29 (Severability) and 30
(Counterparts) of the Credit Agreement
shall apply to this Agreement, mutatis mutandis.
2. CONSENT, CONFIRMATION AND DESIGNATION
2.1 Consent and confirmation
Each Company, each Arranger, each Existing Bank and the Agent
each consent to the New
Banks becoming Banks and confirm that, except as expressly
provided by the terms of this
Agreement, each of the Finance Documents shall continue in full
force and effect.
2.2 Designation
The Agent and the Companies hereby designate this Agreement a
Finance Document.
3. NOVATION
3.1 Novation of Commitments and related rights and
obligations
On the Effective Date (regardless of whether a Default is then
continuing):
(a) each New Bank will become a Bank under the Credit
Agreement with Commitments
set out opposite its name in Schedule 2;
(b) each Commitment of each Existing Bank shall be and be
deemed to be reduced down to
the relevant level set out opposite its name in Schedule 2; and
(c) each New Bank will automatically obtain and assume, and
undertakes to perform, all
of the rights and obligations of a Bank under and in respect of
each of the Finance
Documents in respect of the rights and obligations transferred to
it under paragraphs
(a) and (b) above.
3.2 Amounts due on or before the Effective Date
(a) All amounts (if any) payable to an Existing Bank by the
Borrowers on or before the Effective
Date (including, without limitation, all interest and fees
payable on the Effective Date) in
respect of any period ending prior to the Effective Date shall be
for the account of the Existing
Bank, and none of the New Banks shall have any interest in, or
any rights in respect of, any
such amount.
(b) If any Loan falls to be made on the Effective Date:
(i) the Agent will promptly notify each of the New Banks of
that fact (and of the amount
of its participation in that Loan in accordance with paragraph
(ii) below); and
(ii) each Existing Bank and each New Bank shall participate in
that Loan (subject to the
terms of the Credit Agreement) as if the novation of Commitments
under Clause 3.1
(Novation of Commitments and related rights and obligations) of
this Agreement had
taken effect prior to opening of business on the Business Day
before the Effective
Date,
and the Companies acknowledge that each Existing Bank will not be
obliged to participate in
any such Loan to any greater extent.
3.3 Administrative details
Each New Bank has delivered to the Agent its initial details for
the purposes of Clause 31
(Notices) of the Credit Agreement.
4. NATURE OF THIS AGREEMENT
For the avoidance of doubt, the parties to this Agreement agree
that the transfer of rights and
obligations contemplated by this Agreement shall take effect (in
accordance with its terms) as a
novation so that:
(a) Schedule 2 is substituted for Schedule 1 to the Credit
Agreement on the Effective Date;
and
(b) this Agreement being a Novation Agreement, Clause 25.3(c)
(Procedure for novations)
of the Credit Agreement shall apply to the rights and obligations
transferred, assumed
and released under Clause 3.1 (Novation of Commitments and
related rights and
obligations) of this Agreement and to the associated rights and
obligations under the
Finance Documents.
5. GOVERNING LAW
This Agreement is governed by English law.
This Agreement has been entered into on the date stated at the
beginning of this Agreement.
SCHEDULE 1
THE NEW BANKS
SCHEDULE 2
BANKS AND COMMITMENTS
Commitments
Banks
Facility A
Facility B
Facility C
(POUND)
(POUND)
(POUND)
Total Commitments
(POUND)150,000,000
(POUND)130,000,000
(POUND)50,000,000
SIGNATORIES
The Borrowers
YORKSHIRE POWER GROUP LIMITED
By: X. XXXX X. XXXXX
YORKSHIRE HOLDINGS PLC
By: X. XXXX X. XXXXX
YORKSHIRE ELECTRICITY GROUP PLC
By X. XXXX X. XXXXX
The Arrangers
CITIBANK, N.A.
By: XXXXX X. XXXX
DEUTSCHE BANK AG LONDON
By: XXXX XXXXXX
The Banks
CITIBANK, N.A.
By: XXXXX X. XXXX
DEUTSCHE BANK AG LONDON
By: XXXX XXXXXX
THE BANK OF TOKYO-MITSUBISHI, LTD.
By: XXXX XXXXXX (POWER OF ATTORNEY)
BAYERISCHE LANDESBANK GIROZENTRALE
By: XXXXXXX XXXXX
DEN DANSKE BANK AKTIESELSKAB
By: XXXX XXXXXX (POWER OF ATTORNEY)
DRESDNER BANK AG LONDON BRANCH
By: C.D.A. XXXXXX XXXXXXX XXX
MIDLAND BANK PLC
By: XXXX X. XXXXXX
NATIONAL WESTMINSTER BANK PLC
By: XXXX XXXXXXXX
THE TORONTO-DOMINION BANK
By: XXXXXX XXXXXXX
THE BANK OF NEW YORK
By: XXXXXX X. XXXXXX
BARCLAYS BANK PLC
By: XXXX XXXXXX (POWER OF ATTORNEY)
NATIONSBANK, N.A.
By: XXXX XXXXXX (POWER OF ATTORNEY)
The Agent
CITIBANK INTERNATIONAL plc
By: XXXXX X. XXXXX
B1:136040.7
CONFORMED COPY
AGREEMENT
DATED 22nd July, 1998
(POUND)330,000,000
REVOLVING CREDIT AND TERM LOAN FACILITY
FOR
YORKSHIRE POWER GROUP LIMITED
YORKSHIRE HOLDINGS PLC
and
YORKSHIRE ELECTRICITY GROUP PLC
ARRANGED BY
CITIBANK, N.A.
and
DEUTSCHE BANK AG LONDON
XXXXX & XXXXX
London
for the Borrowers
XXXXXXXX CHANCE
London
for the Finance Parties
INDEX
Clause Page
1. Interpretation 1
2. The Facilities 18
3. Purpose 19
4. Conditions Precedent 19
5. Drawdown 20
6. Repayment 21
7. Prepayment and Cancellation 21
8. Interest Periods 23
9. Interest 25
10. Payments 26
11. Taxes 28
12. Market Disruption 29
13. Increased Costs 30
14. Illegality and Mitigation 32
15. Representations and Warranties 32
16. Undertakings 36
17. Default 43
18. The Agent and the Arranger 46
19. Fees 51
20. Expenses 51
21. Stamp Duties 52
22. Indemnities 52
23. Evidence and Calculations 53
24. Amendments and Waivers 54
25. Changes to the Parties 55
26. Disclosure of Information 57
27. Set-Off 57
28. Pro Rata Sharing 58
29. Severability 59
30. Counterparts 59
31. Notices 59
32. Governing Law 60
Schedules
1. Banks and Commitments 61
2. Conditions Precedent Documents 62
3. Calculation of the Mandatory Cost 63
4. Form of Request 65
5. Part I - Form of Novation Certificate 66
Part II - Form of Novation Agreement 67
Signatories 73
THIS AGREEMENT is dated 22nd July, 1998 between:-
(1) YORKSHIRE ELECTRICITY GROUP PLC (the "Borrower");
(2) CITIBANK, N.A. and DEUTSCHE BANK AG LONDON (in this
capacity the "Arrangers");
(3) THE FINANCIAL INSTITUTIONS listed in Schedule 1 as banks;
(4) CITIBANK INTERNATIONAL PLC as facility agent (in this
capacity the "Facility Agent").
(5) CITIBANK, N.A. NEW YORK as swingline agent (in this
capacity the "Swingline Agent")
IT IS AGREED as follows:-
1. INTERPRETATION
1.1 Definitions
In this Agreement:-
"Act"
means the Electricity Xxx 0000 and, unless the context otherwise
requires, all subordinate
legislation and any successive legislation thereto.
"Adjusted Share Capital and Reserves"
means the aggregate of:
(a) the amount paid up or credited as paid up on the issued
share capital of YPG; and
(b) the amounts standing to the credit of the consolidated
capital and revenue reserves of
YPG and its Subsidiaries (the "YPG Group"),
adjusted, to the extent that the following items have not already
been added, deducted or
excluded in arriving at the figures referred to in paragraph (a)
or (b) above:
(i) by adding Subordinated Debt and the Preferred Securities;
(ii) by deducting the amounts standing to the debit of the
consolidated reserves of the
YPG Group;
(iii) by deducting any amounts attributable to interests of
non-YPG Group members in
YPG Group subsidiaries;
(iv) by deducting any reserves set aside for deferred
taxation;
(v) by deducting the amount by which the net book value of
any fixed asset has been
written up after the date of this Agreement (or, in the case of a
person becoming a
member of the YPG Group after that date, the date on which it
becomes a member of
the YPG Group) by way of revaluation or on its transfer from one
member of the
YPG Group to another (but no such deduction shall be made in
respect of any amount
if supported by, and not exceeding the amount shown by, an
independent written
valuation),
but so that no amount to be added, deducted or excluded as a
result of any of the above shall be
added, deducted or excluded more than once in the same
calculation.
"Affiliate"
means a Subsidiary or a holding company (as defined in Section
736 of the Companies Act
1985) of a Bank or any other Subsidiary of that holding company.
"Affiliated Bank"
means a Bank which is an Affiliate of another Bank.
"Agent"
means the Facility Agent or the Swingline Agent.
"Applicable Rate"
means the rate quoted by the Facility Agent to the Borrower to be
that at which money can be
deposited in the London interbank market on the earliest
available day, provided that the
applicable rate shall not be less than LIBID nor more than LIBOR.
"Balance Sheet"
means, at any time, the then most recent audited consolidated
annual or unaudited consolidated
half yearly balance sheet of the Group delivered to the Facility
Agent by the Borrower under
Clause 17.2 (Financial information).
"Bank"
means a Revolving Credit Bank or a Swingline Bank.
"Borrowings"
means indebtedness in respect of:
(a) moneys borrowed or raised including (except for the
purposes of Clause 18.5 (Cross
default)) the recourse element of any asset securitisation or
other factoring but
excluding any amounts owing for assets purchased or services
obtained on trade credit
terms in the ordinary course of business;
(b) amounts raised by means of acceptances under any
acceptance credit facility or
otherwise (not being acceptances in relation to the purchase of
assets or services in the
ordinary course of business);
(c) the deferred purchase price of assets or services the
payment of which is deferred for a
period in excess of ninety days (other than assets or services
obtained on trade credit
terms normal in the business concerned);
(d) the principal amount and any premium payable by the
relevant company from time to
time owing in respect of any loan notes, debentures, bonds or
other similar
instruments;
(e) the capital value of any financial lease, hire purchase
arrangements or any arrangement
treated as a financial lease required to be capitalised and
treated as a borrowing in the
consolidated balance sheet of the Group;
(f) for the purposes of Clause 18.5 (Cross default) (only)
net indebtedness under any
currency or interest cap, swap or collar; and
(g) any guarantee or assurance against financial loss or
indemnity in respect of the
borrowings of any other person not being a member of the Group of
a type referred to
in paragraphs (a) to (f) (inclusive) above (but excluding any
such guarantee or
assurance in respect of the performance of any contract or
service not involving
financial loss or indemnity in respect of borrowings),
but shall exclude:
(A) liabilities in respect of the Pooling and Settlement
Agreement or other arrangements
which replace the Pooling and Settlement Agreement in accordance
with Clause 18.12
(Pooling and Settlement Agreement);
(B) Project Finance Borrowings; and
(C) for the avoidance of doubt, the Preferred Securities.
"Business Day"
means a day (other than a Saturday or a Sunday) on which banks
are open for business in
London and (in relation to a transaction involving the Swingline
Facility) New York.
"Commitment"
means a Revolving Credit Commitment or a Swingline Commitment.
"Commitment Period"
means the period from the date of this Agreement to the Repayment
Date (both dates inclusive).
"Default"
means an Event of Default or an event which, with the giving of
notice or lapse of time
provided for in Clause 18 (Default) (or any combination of the
foregoing), would constitute an
Event of Default.
"Director General"
means the person from time to time appointed by the Secretary of
State to hold office as
Director General of Electricity Supply for the purposes of the
Electricity Xxx 0000 or any
office which replaces the function of the Director General of
Electricity Supply.
"Double Taxation Treaty"
means any convention between the government of the United Kingdom
and any other
government for the avoidance of double taxation and the
prevention of fiscal evasion with
respect to taxes on income and capital gains.
"Drawdown Date"
means the date of the advance of a Loan.
"EBITDA"
means, in respect of any Relevant Period, the total operating
profit for continuing operations,
acquisitions (as a component of continuing operations) and
discontinued operations of the
Group before taking into account:
(a) Interest Payable and Interest Receivable;
(b) all amounts provided for depreciation and amortisation
(including, without limitation,
amortisation of any goodwill);
(c) all exceptional and extraordinary items; and
(d) all taxes,
in each case for that Relevant Period but after:
(A) deducting any gain over book value arising in favour of
the Group on the sale, lease or
other disposal of any asset (other than on the sale of trading
stock) during the Relevant
Period and any gain arising on revaluation of any asset during
that Relevant Period, in
each case to the extent that it would otherwise be taken into
account, whether as an
exceptional item or otherwise; and
(B) excluding the earnings or profit before interest, tax
depreciation and amortisation (as
determined in accordance with the preceding paragraphs of this
definition) and
excluding all exceptional and extraordinary items of any company
referred to in
paragraph (a) of the definition of Project Finance Borrowings,
(all calculated on a consolidated basis disregarding any portion
of any item taken into account
in that calculation which is attributable to any minority
interests in Subsidiaries).
"Environmental Law"
means any applicable law (including, without limitation, common
law), regulation, directing
code of practice, circular, guidance notice or the like
concerning pollution or the protection of
human health, the environment, the conditions of the work place
or the manufacture,
processing, generation, transportation, storage, treatment or
disposal of dangerous substances,
pollutants, contaminants, chemicals or toxic or hazardous
substances or waste.
"Environmental Licence"
means any authorisation required by any Environmental Law.
"Event of Default"
means an event specified as such in Clause 18.1 (Events of
Default).
"Existing Facilities"
means:
(a) the bilateral credit facility made available to YPG under
the agreement dated 31st July,
1997 and made between YPG and Union Bank of Switzerland; and
(b) each bilateral credit facility dated 2nd May, 1995 made
available to the Borrower by
Midland Bank PLC, Den Danske Bank Aktieselskab, The Sumitomo
Bank, Limited,
Deutsche Bank AG London, The Bank of Tokyo-Mitsubishi, Limited,
National
Westminster Bank Plc, Union Bank of Scotland and Xxxxxx Guaranty
Trust Company
of New York.
"Facility"
means each of the Revolving Credit Facility and the Swingline
Facility.
"Facility Agent's Spot Rate of Exchange"
means the Facility Agent's spot rate of exchange for the purchase
of Dollars in the London
foreign exchange market with sterling at or about 11.00 a.m. on a
particular day for delivery
two days hence.
"Facility Office"
means the office(s) notified by a Bank to the Facility Agent:
(a) on or before the date it becomes a Bank; or
(b) by not less than five Business Days' notice,
as the office through which it will perform all or any of its
obligations under this Agreement.
"Federal Funds Rate"
means, on any day, the rate per annum determined by the Swingline
Agent to be the Federal
Funds Rate (as published by the Federal Reserve Bank of New York)
at or about 1.00 p.m.
(New York City time) on that day.
"Finance Document"
means this Agreement, any Novation Agreement, any Novation
Certificate or any other
document designated as such by the Facility Agent and the
Borrower.
"Finance Party"
means an Arranger, a Bank or an Agent.
"Group"
means the Borrower and its Subsidiaries.
"Information Memorandum"
means the Information Memorandum dated June, 1998 and prepared in
connection with this
Agreement.
"Interest Payable"
means, in respect of any Relevant Period, all interest payable
and similar charges as shown in
(or in the notes to) the financial statements of the Group
(calculated on a consolidated basis)
for the Relevant Period but excluding interest payable on Project
Finance Borrowings by
companies referred to in paragraph (a) of that definition.
"Interest Period"
means each period determined in accordance with Clause 9
(Interest Periods).
"Interest Receivable"
means, in respect of any Relevant Period, all interest receivable
and similar income as shown in
(or in the notes to) the financial statements of the Group
(calculated on a consolidated basis)
for that Relevant Period but excluding interest receivable by a
company of the type referred to
in paragraph (a) of the definition of Project Finance Borrowings.
"Investments"
means, as at any date, the aggregate (calculated on a
consolidated basis) of:
(a) cash in hand in a jurisdiction where such amounts are
freely transferable out of that
jurisdiction and convertible into currencies dealt in on the
London foreign exchange
market;
(b) money at call in a jurisdiction, and freely convertible
into currencies, referred to in (a)
above;
(c) deposits and certificates of deposit the term of which
has twelve months or less
remaining to maturity in a jurisdiction, and freely convertible
into currencies, referred
to in (a) above;
(d) United Kingdom gilts;
(e) deposits made with the Commissioners of Inland Revenue in
respect of which
certificates of tax deposit have been issued by Her Majesty's
Treasury;
(f) sterling bills of exchange eligible for rediscount at the
Bank of England;
(g) bonds rated AA- (or the equivalent) or above by Standard
& Poor's Ratings Group,
The Fitch IBCA Group or Duff & Xxxxxx Credit Rating Co. or
Xxxxx'x Investors
Service, Limited; and
(h) any other negotiable money market instrument issued by an
issuer in a jurisdiction, and
convertible into currencies, referred to in (a) above with a
maximum maturity of twelve
months or less, excluding commercial paper (unless it is rated at
least A1 (or the
equivalent) by Standard & Poor's Ratings Group or The Fitch IBCA
Group or Duff &
Xxxxxx Credit Rating Co. or P1 by Xxxxx'x Investors Service,
Limited),
provided that, when the aggregate amount of Investments required
to be taken into account for
the purposes of this definition on any particular day is being
ascertained, any such Investments
denominated or repayable or in respect of which monies are
payable in a currency other than
sterling shall be taken into account at their sterling equivalent
at the rate of exchange prevailing
on that day in London using the Facility Agent's Spot Rate of
Exchange.
"LIBID"
means, in relation to an amount received by the Facility Agent
referred to in Clause 23.2(b)
(Other indemnities), the arithmetic mean (rounded to four decimal
places) of the rates, as
supplied to the Facility Agent at its request, quoted by the
Reference Banks to leading banks in
the London interbank market at or about 11.00 a.m. on the
relevant day for the taking of
deposits in sterling and in an amount approximately equal to the
amount so received from the
Borrower for the period from and including the date that payment
is received by the Facility
Agent to but excluding the last day of the Interest Period of the
relevant Loan or amount.
"LIBOR"
means, in relation to an Interest Period:
(a) the rate appearing on the Telerate Screen page 3750 or
any equivalent successor to
such page or other page as appropriate on the Telerate Service or
(failing which) such
other service as may, from time to time, display the British
Bankers' Association
Interest Settlement Rates for deposits in sterling (as agreed
between the Borrower and
the Facility Agent (acting reasonably)) (the "Telerate Screen");
or
(b) (if no such offered rate for quotations appears on the
Telerate Screen) the arithmetic
mean (rounded to four decimal places) of the relevant offered
rates which appear on
the relevant page of the Reuters Screen; or
(c) (in the absence of manifest error, if no such offered
rate for quotations appears on the
Telerate Screen or the Reuters Screen) the arithmetic mean
(rounded to four decimal
places) of the rates, as supplied to the Facility Agent at its
request, quoted by the
Reference Banks to leading banks in the London interbank market,
(in each case) at 11.00 a.m. on the first day of that Interest
Period, as being the interest rate(s)
quoted in the London interbank market for the offering of
deposits in sterling for a period equal
to that Interest Period.
"Licence"
means the public electricity supply licence granted by the
Secretary of State to the Borrower
under Section 6(I)(c) of the Electricity Xxx 0000 as modified or
supplemented from time to time
and, if any such licence is split by or with the consent of the
Director General into more than
one new licence, each such new licence.
"Licence Holder"
means at any time a member of the Group which then holds a
Licence.
"Loan"
means a Revolving Loan or a Swingline Loan.
"Majority Banks"
means, at any time, Revolving Credit Banks:-
(a) whose participations in the Loans then outstanding
aggregate more than 662/3 per cent.
of all the Loans then outstanding; or
(b) if there are no Loans then outstanding, whose Commitments
then aggregate more than
662/3 per cent. of the Total Commitments; or
(c) if there are no Loans then outstanding and the Total
Commitments have been reduced
to nil, whose Commitments aggregated more than 662/3 per cent. of
the Total
Commitments immediately before the reduction.
"Mandatory Cost"
means the cost imputed to the Banks of compliance with the
Mandatory Liquid Assets
requirements of the Bank of England and the requirements of the
Financial Services Authority
expressed as a rate per annum and determined in accordance with
Schedule 3.
"Margin"
means 0.25 per cent. per annum.
"Material Adverse Effect"
means a material adverse effect on:
(a) the ability of YEG to comply, from time to time, with its
obligations under
Clause 17.14 (Financial covenants);
(b) the ability of any Borrower to meet its payment
obligations under the Finance
Documents; or
(c) in respect of Clauses 16.5 (Non-conflict), 16.10
(Litigation), 16.11 (Licence), 17.13
(Licence), 17.15 (Licence undertakings), 18.11 (Licence), 18.12
(Pooling and
Settlement Agreement) and 18.13 (Compliance with the Act) only,
the ability of any
Borrower to meet any of its other material obligations under the
Finance Documents.
"Net Interest Payable"
means, in respect of any Relevant Period, Interest Payable less
Interest Receivable for that
Relevant Period.
"New York Business Day"
means a day (other than a Saturday or Sunday) on which banks are
open for business in New
York.
"Novation Agreement"
means an agreement substantially in the form of Part II of
Schedule 5.
"Novation Certificate"
means a certificate substantially in the form of Part I of
Schedule 5.
"Original Group Accounts"
means the audited consolidated accounts of the Group for the year
ended 31st March, 1998.
"Original Sterling Amount"
in relation to a Loan, means:-
(a) if that Loan is denominated in sterling, the amount of
that Loan; or
(b) if that Loan is a Swingline Loan, the equivalent in
sterling of the amount of that
Swingline Loan calculated at the Facility Agent's Spot Rate of
Exchange on its
Drawdown Date.
"Party"
means a party to this Agreement.
"Permitted Security Interest"
means any Security Interest:
(a) arising pursuant to an order of attachment or injunction
restraining disposal of assets
or similar legal process which is contested by the Borrower or
any of its Subsidiaries
in good faith or created in favour of a plaintiff or defendant in
any action of the court
or tribunal before whom such action is brought as security for
costs or expenses where
the Borrower or one of its Subsidiaries is prosecuting or
defending such action in the
bona fide interests of the Group;
(b) arising by operation of law or contained in a contract
for the sale of goods or supply of
services entered into in the ordinary course of business of the
company creating the
same or which is a pledge over or assignment of documents of
title, insurance policies
and sale contracts in relation to commercial goods created or
made in the ordinary
course of business to secure the purchase price of goods or
indebtedness to finance
such purchase price;
(c) over or affecting any asset acquired by a member of the
Group after the date hereof
and subject to which such asset is acquired or (2) any asset of
any company which
becomes a member of the Group after the date hereof, where such
Security Interest is
created prior to the date on which such company becomes a member
of the Group,
provided that in each case:
(i) the principal amount secured by such Security Interest is
not increased either
as a result of such acquisition or such company becoming a member
of the
Group or thereafter and, when aggregated with such other Security
Interests
under this paragraph (c), does not exceed (POUND)15,000,000 (or
its equivalent in any
other currency or currencies); or
(ii) that Security Interest is discharged within 180 days of
such acquisition or such
company becoming a member of the Group;
(d) which is a Security Interest (a "Substitute Security
Interest") which replaces any
Permitted Security Interest and which secures an amount not
exceeding the principal
amount secured by such Permitted Security Interest in such
circumstances when such
Permitted Security Interest will be released as a consequence of
such Substitute
Security Interest being granted;
(e) arising in connection with any cash management or netting
arrangements made
between any banks or financial institutions and any member or
members of the Group;
(f) created prior to the date of this Agreement (including,
without limitation, any existing
Security Interest in favour of the European Investment Bank)
provided the principal
amount secured by such Security Interest shall not be increased
after the date of this
Agreement;
(g) arising out of title retention provisions in a supplier's
standard conditions of supply of
goods acquired by any member of the Group in the ordinary course
of business;
(h) over assets and/or (where such assets comprise
substantially the whole of the assets of
the owner thereof) shares or the like in the owner of such assets
securing borrowings
incurred to finance the cost of developing (or acquiring and
developing) such assets
(and/or securing any indebtedness in respect of hedging actual or
projected exposure in
respect of these borrowings) where such borrowings are Project
Finance Borrowings;
(i) created under or pursuant to, or in accordance or
connection with, the terms of any
pooling and settlement agreement (including, without limitation,
the Pooling and
Settlement Agreement) or pooling and settling arrangements of the
electricity supply
industry or any transactions or arrangements entered into in
connection with the
management of risks relating thereto;
(j) securing indebtedness not otherwise permitted to be
secured by Security Interests
provided that the aggregate principal amount of the indebtedness
so secured under this
paragraph (j) shall not at any time exceed (POUND)10,000,000 or
(if higher) 2 per cent. of
Adjusted Share Capital and Reserves; or
(k) to the creation or subsistence of which the Majority
Banks at any time consent in
writing.
"Pooling and Settlement Agreement"
means an agreement dated 30 March 1990 (as amended and restated
at 22 April 1994), made
by the Borrower with The National Grid Company plc and others
setting out the rules and
procedures for the operation of an electricity trading pool and
of a settlement system and, while
the same has effect, the Initial Settlement Agreement dated 30
March 1990;
"Preferred Securities"
means US$275,000,000 8.08% Trust Securities due June 2038.
"Prime Rate"
means the prime commercial lending rate in Dollars from time to
time announced by the
Swingline Agent; each change in the interest rate on a Swingline
Loan which results from a
change in the Prime Rate becomes effective on the day on which
the change in the Prime Rate
becomes effective.
"Principal Subsidiary"
means the Borrower or a Subsidiary of the Borrower (not being a
Subsidiary falling within
category (a) of the definition of Project Finance Borrowings or
any other Subsidiary of the
Borrower whose only Borrowings are Project Finance Borrowings):
(a) whose (i) net assets or (ii) turnover represent 10 per
cent. or more of the net assets of
the Group or consolidated turnover of the Group respectively, in
each case as
calculated by reference to the then latest audited financial
statements of such
Subsidiary (consolidated in the case of a company which itself
has Subsidiaries and
which, in the normal course, prepares consolidated accounts) and
the then latest
audited consolidated financial statements of the Group; or
(b) to which is transferred all or substantially all of the
business, undertaking and assets of
a Subsidiary of the Borrower which immediately prior to such
transfer is a Principal
Subsidiary, whereupon the transferor Subsidiary shall immediately
become a Principal
Subsidiary and the transferee Subsidiary shall cease to be a
Principal Subsidiary under
the provisions of this sub-paragraph (b) (but without prejudice
to the provisions of
sub-paragraph (a) above), upon publication of its next audited
financial statements; or
(c) which is a Licence Holder.
"Project Finance Borrowings"
means any Borrowings to finance the ownership, acquisition,
construction, development and/or
operation of an asset:
(a) made by a single purpose company (whether or not a member
of the Group) whose
principal assets and business are constituted by the ownership,
acquisition,
construction, development and/or operation of an asset and whose
liabilities in respect
of the relevant financing are not directly or indirectly the
subject of a guarantee,
indemnity or any other form of assurance, undertaking or support
from any member of
the Group except as expressly referred to in paragraph (b)(iii)
below; or
(b) in respect of which the person or persons to whom such
Borrowings are or may be
owed by the relevant borrower (whether or not a member of the
Group) has or have no
recourse whatsoever to any member of the Group for the repayment
of or payment of
any sum relating to such Borrowings other than:
(i) recourse to the relevant borrower for amounts limited to
the aggregate cash
flow or net cash flow (other than historic cash flow or historic
net cash flow)
from such asset; and/or
(ii) recourse to such borrower for the purpose only of
enabling amounts to be
claimed in respect of those Borrowings in an enforcement of any
Security
Interest given by such borrower over such asset or the income,
cash flow or
other proceeds arising therefrom (or given by any shareholder or
the like in the
borrower over its shares or the like in the capital of the
relevant borrower) to
secure those Borrowings or any recourse referred to in (iii)
below, provided
that (A) the extent of such recourse to such borrower is limited
solely to the
amount of any recoveries made on any such enforcement, and (B)
such person
or persons are not entitled, by virtue of any right or claim
arising out of or in
connection with such Borrowings, to commence proceedings for the
winding
up or dissolution of the borrower or to appoint or procure the
appointment of
any receiver, trustee or similar person or officer in respect of
the borrower or
any of its assets (save for the assets the subject of such
Security Interest);
and/or
(iii) recourse to such borrower generally, or directly or
indirectly to a member of
the Group under any form of assurance, undertaking or support,
which
recourse is limited to a claim for damages (other than liquidated
damages and
damages required to be calculated in a specified way) for breach
of an
obligation (not being a payment obligation or any obligation to
procure
payment by another or an obligation to comply or to procure
compliance by
another with any financial ratios or other tests of financial
condition) by the
person against whom such recourse is available; or
(c) which the Facility Agent (acting on the instructions of
the Majority Banks) shall have
agreed (acting reasonably) in writing to treat as a Project
Finance Borrowing for the
purposes of this Agreement.
"Qualifying Bank"
means:
(a) a bank which:
(i) is a bank within the meaning of Section 840A of the
Income and Corporation
Taxes Xxx 0000;
(ii) will be beneficially entitled to any interest to be paid
to it (as a Bank) under
this Agreement; and
(iii) is within the charge to United Kingdom corporation tax as
respects such
interest; or
(b) a Treaty Bank.
"Reference Banks"
means, subject to Clause 26.4 (Reference Banks), the Agent,
Deutsche Bank AG London and
National Westminster Bank Plc.
"Relevant Period"
means each period of 12 months ending on the date of the audited
consolidated accounts for
each of the Borrower's financial years and on the date of the
Borrower's unaudited consolidated
accounts for the first half of each of the Borrower's financial
years.
"Repayment Date"
means the fifth anniversary of the date of this Agreement.
"Request"
means a request made by the Borrower for a Loan, substantially in
the form of Schedule 4.
"Revolving Credit Bank"
means, subject to Clause 26.2 (Transfers by Banks), a bank or
financial institution listed in
Part I of Schedule 1 in its capacity as a participant in the
Revolving Credit Facility.
"Revolving Credit Commitment"
means :
(a) in relation to a Revolving Credit Bank which is a
Revolving Credit Bank on the date of
this Agreement, the amount in Sterling set opposite its name in
Part I of Schedule 1
and the amount of any other Bank's Revolving Credit Commitment
acquired by it
under Clause 26 (Changes to the Parties); and
(b) in relation to a Revolving Credit Bank which becomes a
Revolving Credit Bank after
the date of this Agreement, the amount of any other Bank's
Revolving Credit
Commitment acquired by it under Clause 26 (Changes to the
Parties),
to the extent not cancelled, transferred or reduced under this
Agreement.
"Revolving Credit Facility"
means the sterling revolving credit facility referred to in
Clause 2.1(a) (Facilities)
"Revolving Loan"
means the principal amount of each borrowing by the Borrower
under the Revolving Credit
Facility or the principal amount outstanding of that borrowing.
"Rollover Loan"
means one or more Revolving Loans:
(a) whose proposed Drawdown Date is the same as the last day
of the Interest Period of
one or more existing Revolving Loans borrowed under the same
Facility; and
(b) whose aggregate principal amount does not exceed the
aggregate outstanding principal
amount of all existing Revolving Loans under the relevant
Facility whose Interest
Period ends on that Drawdown Date.
"Secretary of State"
means the person from time to time holding office as the
Secretary of State for Trade and
Industry or any successor office thereto;
"Security Interest"
means any mortgage, pledge, lien (other than a lien arising by
operation of law), charge or
other security interest.
"Subordinated Debt"
means, if the YPG Facility has been cancelled in full, the
outstanding amount at any time
(including capitalised interest) of Borrowings which is:
(a) owing by the Borrower to any of the shareholders of YPG;
and
(b) fully subordinated to the indebtedness of the Borrower
under this Agreement by a
subordination agreement in an agreed form.
"Subsidiary"
means:-
(a) a subsidiary within the meaning of Section 736 of the
Companies Xxx 0000 as
amended by Section 144 of the Companies Xxx 0000; and
(b) unless the context otherwise requires, a subsidiary
undertaking within the meaning of
Section 21 of the Companies Xxx 0000.
"Swingline Bank"
means, subject to Clause 26.2 (Transfers by Banks), a bank or
financial institution listed in
Part II of Schedule 1 in its capacity as a participant in the
Swingline Facility.
"Swingline Commitment"
means:-
(a) in the case of a Swingline Bank which is a Swingline Bank
on the date of this
Agreement, the amount in sterling set opposite its name in Part
II of Schedule 1 and the
amount of any other Bank's Swingline Commitment acquired by it
under Clause 26
(Changes to the Parties); or
(b) in the case of a Swingline Bank which becomes a Swingline
Bank after the date of this
Agreement, the amount of any other Bank's Swingline Commitment
acquired by it
under Clause 26 (Changes to the Parties),
to the extent not transferred, cancelled or reduced under this
Agreement.
"Swingline Facility"
means the Dollar swingline facility referred to in Clause 2.1(b)
(Facilities).
"Swingline Loan"
means the principal amount of each borrowing by the Borrower
under the Swingline Facility or
the principal amount outstanding of that borrowing.
"Swingline Rate"
means, on any day, the higher of:
(a) the Prime Rate; and
(b) the aggregate of the Federal Funds Rate and 0.5 per cent.
per annum.
"Syndication Period"
means the period from the date of this Agreement to the earlier
of:
(a) the date on which the Arrangers confirm to YEG that
syndication of the Facility is
complete; and
(b) 30th September, 1998,
or, if New Banks (as defined in Clause 26.2 (Transfers by Banks))
have agreed to commit to
join the Facility under the syndication by the Arrangers but the
relevant Novation Agreement or
Novation Certificate has not been effected by the end of the
Syndication Period, such longer
period as YEG shall agree with the Arrangers.
"Total Revolving Credit Commitments"
means the aggregate for the time being of the Revolving Credit
Commitments, being
(POUND)220,000,000 at the date of this Agreement.
"Total Swingline Commitments"
means the aggregate for the time being of the Swingline
Commitments, being equivalent in
Dollars of (POUND)110,000,000 calculated at the Facility Agent's
Spot Rate of Exchange at the date of
this Agreement.
"Treaty Bank"
means an institution which is resident (as such term is defined
in the appropriate Double
Taxation Treaty) in a country with which the United Kingdom has
an appropriate Double
Taxation Treaty giving residents of that country exemption from
UK taxation on interest and
does not carry on business in the United Kingdom through a
permanent establishment with
which the facility provided under this Agreement is effectively
connected.
"YH"
means Yorkshire Holdings plc.
"YPG"
means Yorkshire Power Group Limited.
"YPG Facility"
means the agreement dated on or about the date of this Agreement
and made between YPG,
YH, the Borrower, the Arrangers, the Banks and the Facility
Agent.
1.2 Construction
(a) In this Agreement, unless the contrary intention appears,
a reference to:-
(i) an "agreed form" means, in the case of a document, the
form of that document agreed
between the Borrower and the Facility Agent as evidenced by the
initialling of that
document (or other written confirmation of the same) by the
Borrower and the Facility
Agent or their respective legal advisers;
"assets" includes present and future properties, revenues and
rights of every
description;
an "authorisation" includes an authorisation, consent, approval,
resolution, licence,
exemption, filing and registration;
a "month" is a reference to a period starting on one day in a
calendar month and
ending on the numerically corresponding day in the next calendar
month, except that, if
there is no numerically corresponding day in the month in which
that period ends, that
period shall end on the last day in that calendar month;
a "regulation" includes any regulation, rule, official directive,
request or guideline
(whether or not having the force of law but, if not having the
force of law, being of a
type with which a relevant person is accustomed to comply) of any
governmental body,
agency, department or regulatory, self-regulatory or other
authority or organisation;
"(POUND)" and "sterling" means the lawful currency for the time
being of the United
Kingdom; and
"tax" includes any present or future tax, levy, impost, duty,
charge, fee deduction or
withholding of any nature and whatever called by whomsoever and
wherever imposed,
levied, collected, withheld or assessed.; and
"US$" or "Dollars" means the lawful currency for the time being
of the United States
of America.
(ii) a provision of law is a reference to that provision as
amended or re-enacted;
(iii) a Clause or a Schedule is a reference to a clause of or a
schedule to this Agreement;
(iv) a person includes its successors and assigns;
(v) a Finance Document or another document is a reference to
that Finance Document or
other document as amended, novated or supplemented; and
(vi) a time of day is a reference to London time.
(b) Unless the contrary intention 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.
(c) The index to and the headings in this Agreement are for
convenience only and are to be ignored
in construing this Agreement.
1.3 Financial definitions
In this Agreement, EBITDA, Interest Payable and Interest
Receivable for any Relevant Period
shall be determined or calculated by reference to the financial
statements of the Borrower or,
for Adjusted Share Capital and Reserves, by reference to the
financial statements of YPG or
any other relevant entity for that Relevant Period delivered to
the Facility Agent under
Clause 17.2 (Financial information).
2. THE FACILITIES
2.1 Facilities
Subject to the terms of this Agreement:-
(a) the Revolving Credit Xxxxx xxxxx to the Borrower a
sterling revolving credit facility;
and
(b) the Swingline Xxxxx xxxxx to the Borrower a Dollar
swingline facility.
2.2 Facility limits
(a) The Swingline Facility is not independent of the
Revolving Credit Facility. The aggregate
Original Sterling Amount of all outstanding Loans (including
Swingline Loans) shall not at any
time exceed the Total Revolving Credit Commitments at that time.
(b) The aggregate Original Sterling Amount of all outstanding
Swingline Loans shall not at any
time exceed the Total Swingline Commitments at that time.
2.3 A Bank's individual limit
(a) A Bank is not obliged to participate in a Loan if it
would cause its applicable Outstandings to
exceed its Overall Commitment.
(b) For the purpose of this Clause 2.3:-
(i) the "applicable Outstandings" of a Bank on any Drawdown
Date means the aggregate
Original Sterling Amount of the participations of that Bank and
its Affiliated Bank(s)
in all outstanding Loans which would be outstanding on that
Drawdown Date, if:-
(1) all outstanding Loans having Maturity Dates which fall on
or before that
Drawdown Date are repaid; and
(2) all Loans to be made on or before that Drawdown Date and
in respect of
which a Request has been received by an Agent are made;
and
(ii) the "Overall Commitment" of a Bank means, in the case of
a Revolving Credit Bank,
its Revolving Credit Commitment or, in the case of a Swingline
Bank which is not a
Revolving Credit Bank, the Revolving Credit Commitment of its
Affiliated Bank which
is a Revolving Credit Bank.
(c) If the operation of Clause 5.3 (Advance of Revolving
Loans) or 6.3 (Advance of Swingline
Loans) would cause the applicable Outstandings of a Bank (the
"affected Bank") to exceed its
Overall Commitment, then:-
(i) the affected Bank will participate in the relevant Loan
only to the extent that its
applicable Outstandings will not exceed its Overall Commitment;
(ii) each other Bank's participation in the Loan under the
relevant Clause will be re-
calculated in accordance with that Clause, but for the purpose of
the recalculation the
affected Bank's Commitment will be deducted from the Total
Revolving Credit
Commitments or the Total Swingline Commitments (as appropriate)
and the amount of
the affected Bank's participation in that Loan (if any) will be
deducted from the
requested amount of the Loan; and
(iii) the calculation in sub-paragraph (ii) above will be
applied to each Bank in turn until
the amount of its participation in the Loan under that Clause is
determined.
2.4 Nature of a Finance Party's rights and obligations
(a) The obligations of a Finance Party under the Finance
Documents are several. Failure of a
Finance Party to carry out those obligations does not relieve any
other Party of its obligations
under the Finance Documents. No Finance Party is responsible for
the obligations of any other
Finance Party under the Finance Documents.
(b) The rights of a Finance Party under the Finance Documents
are divided rights. A Finance
Party may, except as otherwise stated in the Finance Documents,
separately enforce those
rights.
2.5 Change of currency
(a) If more than one currency or currency unit denomination
are at the same time recognised by
the central bank of any country as the lawful currency of that
country, then:-
(i) any reference in the Finance Documents to, and any
obligations arising under the
Finance Documents in, the currency of that country shall be
translated into, or paid in,
the currency or currency unit of that country designated by the
Facility Agent; and
(ii) any translation from one currency or currency unit to
another shall be at the official
rate of exchange or conversion rate recognised by the central
bank for the conversion
of that currency or currency unit into the other, rounded up or
down by the Facility
Agent acting reasonably.
(b) If a change in any currency of a country occurs, this
Agreement will be amended to the extent
the Facility Agent specifies to be necessary to reflect the
change in currency and to put the
Banks and the Borrower in the same position, so far as possible,
that they would have been in if
no change in currency had occurred.
3. PURPOSE
(a) The Borrower shall apply each Loan made to it under the
Revolving Credit Facility towards its
general corporate purposes and those of its Subsidiaries.
(b) The proceeds of a Swingline Loan may not be applied
towards repayment of an outstanding
Swingline Loan.
(c) Without affecting the obligations of any Borrower in any
way, no Finance Party is bound to
monitor or verify the application of any Loan.
4. CONDITIONS PRECEDENT
4.1 Documentary conditions precedent
The Borrower may not deliver the first Request until the
Facility Agent has notified the
Borrower and the Banks that it has received all the documents set
out in Schedule 2 in the
agreed form or, if not in the agreed form, in form and substance
satisfactory to the Facility
Agent; and
4.2 Conditions precedent to first Loan
The obligation of each Bank to make the first Loan to the
Borrower is subject to the further
condition precedent that the Agent has received evidence
satisfactory to it that, on that first
Drawdown Date, the Existing Facilities have been (or will be
immediately following the making
of the first Loan) prepaid and cancelled in full.
4.3 Further conditions precedent
The obligation of each Bank to make any Loan is subject to the
further conditions precedent
that:
(a) on both the date of the Request and the Drawdown Date:-
(i) the representations and warranties in Clause 16
(Representations and
warranties) to be repeated on those dates are correct in all
material respects
and will be correct in all material respects immediately after
the Loan is made;
and
(ii) (A) (in the case of a Loan other than a Rollover
Loan) no Default
(B) in the case of a Rollover Loan, no Event of Default
is outstanding or would result from the making of the Loan.
(b) the loan would not cause Clause 2.2 (Facility limits) to
be contravened).
5. REVOLVING LOANS
5.1 Commitment Period
The Borrower may borrow a Revolving Loan during the
Commitment Period if the Facility
Agent receives, not later than 10.00 a.m. on the Business Day
before the proposed Drawdown
Date a duly completed Request. Each Request is irrevocable.
5.2 Completion of Requests
A Request for a Revolving Loan will not be regarded as having
been duly completed unless:-
(a) it specifies that it is a utilisation of the Revolving
Credit Facility;
(b) the Drawdown Date is a Business Day falling before the
Repayment Date;
(c) the principal amount of the Loan is a minimum of
(POUND)5,000,000 and is an integral
multiple of (POUND)5,000,000 or the balance of the undrawn Total
Revolving Credit
Commitments;
(e) the Interest Period selected complies with Clause 9
(Interest Periods); and
(f) the payment instructions comply with Clause 11
(Payments).
Each Request must specify one Loan only, but the Borrower may,
subject to the other terms of
this Agreement, deliver more than one Request on any one day.
Unless otherwise agreed by the
Facility Agent, the number of Revolving Loans outstanding,
together with the number of loans
outstanding under the YPG Facility, shall not at any time exceed
ten.
5.3 Advance of Revolving Loans
(a) The Facility Agent shall promptly notify each Revolving
Credit Bank of the details of a
requested Revolving Loan and the amount of its participation in
that Revolving Loan.
(b) Subject to the terms of this Agreement, each Revolving
Credit Bank shall make its participation
in a Revolving Loan available to the Facility Agent for the
Borrower on the relevant
Drawdown Date.
(c) The amount of each Bank's participation in a Revolving
Loan will be the proportion of the
Revolving Loan which its Revolving Credit Commitment bears to the
Total Revolving Credit
Commitments on the proposed Drawdown Date, adjusted, if necessary
to reflect the operation
of Clause 2.3 (A Bank's individual limit).
6. SWINGLINE LOANS
6.1 Commitment Period
The Borrower may borrow a Swingline Loan during the Commitment
Period if the Swingline
Agent receives, not later than 10.00 a.m. (New York City time) on
the proposed Drawdown
Date, a duly completed Request. Each Request must be copied to
the Facility Agent and is
irrevocable.
6.2 Completion of Requests
A Request for a Swingline Loan will not be regarded as having
been duly completed unless:-
(a) it specifies that it is a utilisation of the Swingline
Facility;
(b) the Drawdown Date is a New York Business Day falling
before the Repayment Date;
(c) the amount of the Loan is:-
(i) the equivalent in Sterling of a minimum of US$5,000,000
and an integral
multiple of US$1,000,000; or
(ii) the balance of the undrawn Total Swingline Commitments;
or
(iii) such other amount as the Swingline Agent and the Borrower
may agree;
(d) the amount selected under paragraph (c) does not cause
Clause 2.2 (Facility limits) to
be contravened and no more than three Swingline Loans will be
outstanding at any one
time as a result of the making of that Swingline Loan;
(e) the Interest Period selected complies with Clause 9
(Interest Periods); and
(f) the payment instructions comply with Clause 11
(Payments).
6.3 Advance of Swingline Loans
(a) The Swingline Agent shall, not later than 12.00 (noon)
(New York City time) on the proposed
Drawdown Date, notify each Swingline Bank of the details of the
requested Swingline Loan
and the amount of its participation in the Swingline Loan.
(b) Subject to the terms of this Agreement, each Swingline
Bank shall make its participation in the
Swingline Loan available to the Swingline Agent for the Borrower
on the relevant Drawdown
Date.
(c) The amount of each Swingline Bank's participation in the
Swingline Loan will be the
proportion of the Swingline Loan which its Swingline Commitment
bears to the Total
Swingline Commitments on the date of receipt of the relevant
Request, adjusted, if necessary,
to reflect the operation of Clause 2.3 (A Bank's individual
limit).
(d) A Swingline Loan cannot be used to repay another
Swingline Loan.
7. REPAYMENT
7.1 Repayment
The Borrower shall repay each Loan in full on the last day of the
Interest Period for that Loan:
(a) in the case of a Revolving Loan, to the Facility Agent;
or
(b) in the case of a Swingline Loan, to the Swingline Agent.
7.2 Re-borrowing
Subject to the other terms of this Agreement amounts repaid
under this Agreement may be re-
borrowed.
8. PREPAYMENT AND CANCELLATION
8.1 Automatic cancellation
The Commitments of each Bank shall be automatically cancelled at
the close of business on the
Repayment Date.
8.2 Voluntary prepayment
(a) The Borrower may at any time, by giving not less than
five Business Days' prior notice (or
such shorter period as the Majority Banks may agree) to the
Facility Agent, prepay a
Revolving Loan in whole or in part (but, if in part, in a minimum
amount of (POUND)10,000,000 and
an integral multiple of (POUND)5,000,000).
(b) The Borrower may at any time prepay a Swingline Loan in
whole or in part (but, if in part, in a
minimum amount of US$10,000,000 and an integral multiple of
US$5,000,000).
(c) Any prepayment of a Loan under this Clause 8.2 shall be
applied pro rata against the
participations of each Bank participating in that Loan.
8.3 Voluntary cancellation
(a) The Borrower may, by giving not less than five Business
Days' prior notice (or such lesser
period as the Majority Banks may agree) to the Facility Agent,
cancel the undrawn amount of
the Total Revolving Credit Commitments in whole or in part (but,
if in part, in a minimum
amount of (POUND)10,000,000 and an integral multiple of
(POUND)5,000,000).
(b) The Borrower may, by giving not less than five Business
Days' prior notice to the Swingline
Agent, cancel the unutilised portion of the Total Swingline
Commitments in whole or in part
(but, if in part, in a minimum amount of (POUND)10,000,000 and an
integral multiple of (POUND)5,000,000).
(c) Any cancellation in part shall be applied pro rata
against the relevant Commitment of each
Bank.
(d) The Borrower may not cancel the Total Revolving Credit
Commitments if it would result in the
Total Swingline Commitments exceeding the Total Revolving Credit
Commitments.
8.4 Additional right of prepayment and cancellation
(a) If:-
(i) any Borrower is required to pay to a Finance Party any
additional amounts under
Clause 12 (Taxes); or
(ii) any Borrower is required to pay to a Finance Party any
amount under Clause 14
(Increased costs)
then, without prejudice to the obligations of the Borrower under
those Clauses, the Borrower
may, whilst the relevant circumstances continue, serve a notice
of prepayment and cancellation
on that Bank through the Facility Agent. In that event:-
(i) each of the Commitments of that Bank and its Affiliated
Bank (if any) shall be
cancelled; and
(ii) on the date falling five Business Days after the date of
service of the notice, the
Borrower shall prepay the participation of that Bank and its
Affiliated Bank (if any) in
all the Loans made to it.
(b) If interest on a Loan is being calculated in accordance
with Clause 13.3 (Alternative basis),
then, without prejudice to the obligations of the Borrower under
that Clause, the Borrower
may, whilst the relevant circumstances continue, serve a notice
of prepayment and cancellation
on each Bank through the Facility Agent. On the date falling
five Business Days after the date
of service of the notice, the Borrower giving such notice shall
prepay all the Loans made to it.
8.5 Miscellaneous provisions
(a) Any notice of prepayment and/or cancellation under this
Agreement is irrevocable.
(b) All prepayments under this Agreement shall be made
together with accrued interest on the
amount prepaid and, subject to Clause 23.2 (Other indemnities),
without premium or penalty.
(c) No prepayment or cancellation is permitted except in
accordance with the express terms of this
Agreement.
(d) No amount of a Commitment cancelled under this Agreement
may subsequently be reinstated.
9. INTEREST PERIODS
9.1 General
Each Loan shall have one Interest Period only.
9.2 Selection
(a) The Borrower may select an Interest Period for a Loan in
the relevant Request. Each Interest
Period for a Loan will commence on its Drawdown Date.
(b) Subject to the following provisions of this Clause 9:
(i) each Interest Period for a Revolving Loan will be either
an approved duration or an
optional duration as so selected under paragraph (a) above; and
(ii) each Interest Period for a Swingline Loan will be a
period not exceeding seven New
York Business Days.
(c) No Interest Period for a Loan may extend beyond the
Repayment Date.
(d) In this Clause 8:-
"approved duration" means one, two, three or six months; and
"optional duration" means any other period agreed by the Banks.
(e) The Borrower may not select an Interest Period in excess
of one month during the Syndication
Period.
9.3 Selection of an optional duration
(a) If the Borrower selects an Interest Period for a
Revolving Loan of an optional duration, it may
also select an Interest Period of an approved duration to apply
if the selection of an optional
duration becomes ineffective in accordance with paragraph (b)
below.
(b) If:-
(i) the Borrower requests an Interest Period for a Revolving
Loan of an optional duration;
and
(ii) the Facility Agent notifies the Borrower not later than
10.30 a.m. on the first Business
Day of that Interest Period that matching deposits are not
available to the Reference
Banks in the London interbank market to fund the Revolving Loan
for that Interest
Period,
the Interest Period for that Revolving Loan shall be the
alternative period so specified or, in the
absence of any alternative selection, one month.
9.4 Non-Business Days
If an Interest Period for a Revolving Loan would otherwise
end on a day which is not a
Business Day, that Interest Period shall instead end on the next
Business Day in that calendar
month (if there is one) or the preceding Business Day (if there
is not).
9.5 Notification
The Facility Agent shall notify each relevant Party of the
duration of each Interest Period
promptly after ascertaining its duration.
10. INTEREST
10.1 Interest rate
(a) The rate of interest on each Revolving Loan for each its
Interest Period is the rate per annum
determined by the Facility Agent to be the aggregate of the
applicable:-
(i) Margin;
(ii) LIBOR; and
(iii) Mandatory Cost.
(b) The rate of interest on each Swingline Loan for its
Interest Period is the rate per annum
determined by the Swingline Agent to be the Swingline Rate for
each day during the Interest
Period.
10.2 Due dates
Except as otherwise provided in this Agreement, accrued interest
on each Loan is payable by
the Borrower on the last day of each Interest Period for that
Loan and also, if the Interest
Period is longer than six months and the Loan is a Revolving
Loan, on the date falling six
months after the first day of that Interest Period.
10.3 Default interest
(a) If the Borrower fails to pay any amount payable by it
under this Agreement, it shall forthwith
on demand by the Facility Agent pay interest on the overdue
amount from the due date up to
the date of actual payment, as well after as before judgment, at
a rate (the "default rate")
determined by the Facility Agent to be 1 per cent. per annum
above the higher of:
(i) the rate on the overdue amount under Clause 10.1
(Interest rate) immediately before
the due date (if of principal); and
(ii) (1) if the overdue amount relates to a Swingline
Loan, the Swingline Rate; or
(2) in all other cases, the rate which would have been
payable if the overdue
amount had, during the period of non-payment, constituted a
Revolving Loan
in the currency of the overdue amount for such successive
Interest Periods of
such duration as the Facility Agent may determine (each a
"Designated
Interest Period").
(b) The default rate will be determined:
(i) if calculated by reference to the Swingline Rate, on each
day; or
(ii) if calculated by reference to LIBOR, on each Business Day
or the first day of, or two
Business Days before the first day of, the relevant Designated
Interest Period, as
appropriate.
(c) If the default rate is to be calculated by reference to
LIBOR and not rates are being quoted on
the Telerate Screen or the Reuters Screen and the Facility Agent
determines that deposits in
sterling are not at the relevant time being made available by the
Reference Banks to leading
banks in the London interbank market, the default rate will be
determined by reference to the
cost of funds to the Facility Agent from whatever sources it may
select.
(d) Default interest will be compounded daily (if calculated
by reference to the Swingline Rate) or
at the end of each Designated Interest Period (if calculated by
reference to LIBOR).
10.4 Notification
The relevant Agent shall promptly notify each relevant Party of
each determination of each rate
of interest under this Agreement.
11. PAYMENTS
11.1 Place
All payments by the Borrower or a Bank under the Finance
Documents shall be made to the
Agent or (if the payment relates to the Swingline Facility) the
Swingline Agent to its account at
such office or bank in the United Kingdom (or, in the case of the
Swingline Agent, the United
States of America) as it may notify to the other Parties for this
purpose.
11.2 Funds
Payments under the Finance Documents to the Agent shall be made
for value on the due date at
such times and in such funds as the Facility Agent may specify as
being customary at the time
for the settlement of transactions in the relevant currency in
the place for payment.
11.3 Distribution
(a) Each payment received by an Agent under the Finance
Documents for another Party shall,
subject to paragraphs (b) and (c) below, be made available by
that Agent to that Party by
payment (on the date and in the currency and funds of receipt) to
its account with such bank in
the principal financial centre of the United Kingdom (or, in the
case of payments relating to the
Swingline , the United States of America) as it may notify to
that Agent for this purpose by not
less than five Business Days' prior notice.
(b) Each Agent may 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
this Agreement or in or towards the purchase of any amount of any
currency to be so applied.
(c) Where a sum is to be paid under this Agreement to an
Agent under the Finance Documents for
another Party, that Agent is not obliged to pay that sum to that
Party until it has established
that it has actually received that sum. Each Agent may, however,
assume that the sum has
been paid to it in accordance with this Agreement and, in
reliance on that assumption, make
available to that Party a corresponding amount. If the sum has
not been made available but an
Agent has paid a corresponding amount to another Party, that
Party shall refund the
corresponding amount within three Business Days of demand,
together with interest on that
amount from the date of payment to the date of receipt,
calculated at a rate determined by that
Agent to reflect its cost of funds.
11.4 Currency
(a) A repayment or prepayment of a Loan or any part of a Loan
is payable in the currency in
which the Loan is denominated on its due date.
(b) Interest is payable in the currency in which the relevant
amount in respect of which it is
payable is denominated.
(c) Amounts payable in respect of costs, expenses and taxes
and the like are payable in the
currency in which they are incurred.
(d) Any other amount payable under the Finance Documents is,
except as otherwise provided in the
Finance Documents, payable in sterling.
11.5 Set-off and counterclaim
All payments made by the Borrower under the Finance Documents
shall be made without set-
off or counterclaim.
11.6 Non-Business Days
(a) If a payment under the Finance Documents is due on a day
which is not a Business Day, the
due date for that payment shall instead be the next Business Day
in the same calendar month (if
there is one) or the preceding Business Day (if there is not).
(b) During any extension of the due date for payment of any
principal under this Agreement
interest is payable on that principal at the rate payable on the
original due date.
11.7 Partial payments
(a) If the Facility Agent receives a payment insufficient to
discharge all the amounts then due and
payable by the Borrower under this Agreement, the Facility Agent
shall apply that payment
towards the obligations of the Borrower under this Agreement in
the following order:-
(i) first, in or towards payment pro rata of any unpaid fees,
costs and expenses of the
Agents under this Agreement;
(ii) secondly, in or towards payment pro rata of any accrued
interest 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) If the Swingline Agent receives a payment insufficient to
discharge all the amounts then due
and payable by the Borrower to the Swingline Banks under this
Agreement, the Swingline
Agent shall apply that payment towards the obligations of the
Borrower under the Finance
Documents in respect of the Swingline Facility in the following
order:-
(i) first, in or towards payment pro rata of any unpaid fees,
costs and expenses of the
Swingline Agent under the Finance Documents;
(ii) secondly, in or towards payment pro rata of any accrued
interest on a Swingline Loan
due but unpaid under this Agreement; and
(iii) thirdly, in or towards payment pro rata of the principal
of any Swingline Loan due but
unpaid under this Agreement.
(c) The relevant Facility Agent shall, if so directed by all
the Banks in the case of paragraph (a)
above or all the Swingline Banks in the case of paragraph (b)
above, vary the order set out in
sub-paragraphs (a)(ii) to (iv) above or b(ii) and (iii) above as
appropriate.
(d) Paragraphs (a), (b) and (c) above will override any
appropriation made by the Borrower.
12. TAXES
12.1 Gross-up
Subject to Clause 12.4 (Exceptions from gross-up), each payment
to be made by the Borrower
under this Agreement shall be made free and clear of and without
deduction or withholding
(whether for or on account of tax or otherwise) unless the
Borrower is required by law to make
such a payment subject to such deduction or withholding in
respect of any taxes imposed by
laws of the United Kingdom or any federation or association of
sovereign states of which the
United Kingdom is a member ("Relevant Taxes"). If any Relevant
Tax or amounts in respect
of Relevant Tax must be deducted, or any other deductions must be
made, from any amounts
payable or paid by the Borrower, or paid or payable by an Agent
to a Bank, under the Finance
Documents, the Borrower shall (subject as provided in this
Clause) increase the sum payable
to the extent necessary to ensure that, after the making of such
deduction or withholding, the
relevant Bank receives and retains (free from any liability in
respect of any such deduction or
withholding) a net sum equal to the sum which it would have
received and so retained had no
such deduction or withholding been made or required to be made.
12.2 Tax receipts
Within 30 days after paying any sum from which it is required by
law to make any deduction
or withholding, the Borrower shall deliver to the relevant Agent
for the relevant Bank evidence
satisfactory to that Bank of that deduction, withholding or
payment and (where remittance is
required) of the remittance thereof to the relevant taxing or
other authority (a receipt by the
relevant taxing or other authority being deemed to be such
evidence).
12.3 Tax credits
If the Borrower makes a payment under Clause 12.1 (Gross-up) for
the account of a Bank and
that Bank determines that it has received or been granted a
credit against or relief or remission
for, or repayment of, any tax paid or payable by it in respect of
or calculated with reference to
the deduction or withholding under Clause 12.1 (Gross-up) that
Bank shall, to the extent that it
can do so without prejudice to the retention of the amount of
such credit, relief, remission or
repayment, pay to the Borrower such amount as that Bank
determines is attributable to such
deduction or withholding under Clause 12.1 (Gross-up) and which
will leave that Bank (after
such payment) in no better or worse position than it would have
been in if the Borrower had not
been required to make such deduction or withholding under Clause
12.1 (Gross-up). Nothing
in this Clause 12.3 shall interfere with the right of a Bank to
arrange its tax affairs in whatever
manner it thinks fit nor oblige a Bank to disclose any
information relating to its tax affairs or
any computations in respect thereof.
12.4 Exceptions from gross-up
(a) If:
(i) a Revolving Bank is not or ceases to be a Qualifying
Bank; and
(ii) as a result the Borrower is required to deduct or
withhold United Kingdom income tax
in respect of payments of interest to be made by the Borrower to
that Revolving Bank
under this Agreement,
then the Borrower shall not be liable to pay under Clause 12.1
(Gross-up) in respect of any
such payment of interest any amount in excess of the amount it
would have been obliged to pay
if that Revolving Bank were a Qualifying Bank provided that this
Clause 12.4 shall not apply
if, after the date of this Agreement any change occurs in, or in
the official interpretation or
application of, any relevant law or the practice of the United
Kingdom Inland Revenue and as a
result thereof that Bank is not or ceases to be a Qualifying
Bank.
(b) The obligation of the Borrower to pay an additional
amount under Clause 12.1 (Gross-up) shall
not apply to the extent that the tax deducted is tax on the
overall net income of a Bank save to
the extent that such tax is in respect of the relevant payment
from which the deduction must be
made.
(c) A Borrower is not obliged to pay any additional amounts
under Clause 12.1 (Gross-up) in
respect of any deduction which, if the relevant Finance Party had
completed a declaration,
claim, exemption or other form which it is able to complete,
would not have been required.
12.5 Notification
If at any time after the date of this Agreement a Revolving Bank
is aware that it is not or will
cease to be a Qualifying Bank (for whatever reason), it shall
promptly notify the Borrower
through the Facility Agent.
13. MARKET DISRUPTION
13.1 Absence of quotations
If LIBOR is to be determined by reference to the Reference Banks
but a Reference Bank does
not supply an offered rate by 11.30 a.m. on the Drawdown Date,
the applicable LIBOR shall,
subject to Clause 13.2 (Market disruption), be determined on the
basis of the quotations of the
remaining Reference Banks.
13.2 Market disruption
If:
(a) LIBOR is to be determined by reference to the Reference
Banks but no, or only one,
Reference Bank supplies a rate by 11.30 a.m. on the Drawdown Date
or the Facility
Agent otherwise determines that, by reason of circumstances
affecting the London
Interbank Market generally and not specific to the Revolving
Credit Bank or Revolving
Credit Banks concerned, adequate and fair means do not exist for
ascertaining LIBOR;
or
(b) the Facility Agent receives notification from Revolving
Credit Banks whose
participations in a Revolving Loan exceed 50 per cent. of that
Loan that, by reason of
circumstances affecting the London Interbank Market generally and
not specific to the
Revolving Credit Bank or Revolving Credit Banks concerned:-
(i) matching deposits will not be available to them in the
London interbank market
in the ordinary course of business to fund their participations
in that Loan for
the relevant Interest Period; or
(ii) the cost to them of matching deposits in the London
interbank market would be
in excess of LIBOR for the relevant Interest Period,
the Facility Agent shall promptly notify the Borrower and the
Revolving Credit Banks
of the fact and that this Clause 13 is in operation.
13.3 Alternative basis
(a) If a notification under Clause 13.2 (Market disruption)
applies to a Loan which has not been
made:
(i) that Loan shall still be made;
(ii) the first Interest Period of that Loan shall be one
month; and
(iii) interest in respect of that Loan shall be calculated in
accordance with paragraph (b)
below.
(b) If a notification under Clause 13.2 (Market disruption)
applies to a Loan which is made under
paragraph (a) above or which is outstanding then, notwithstanding
any other provision of this
Agreement:
(i) within five Business Days of receipt of the notification,
the Borrower and the Facility
Agent shall enter into negotiations for a period of not more than
30 days with a view to
agreeing an alternative basis for determining the rate of
interest and/or funding
applicable to that Loan and/or any other Loans;
(ii) if no alternative basis is agreed, the Facility Agent
shall certify on or before the last
day of the Interest Period to which the notification relates an
alternative basis for
maintaining that Loan, which shall be binding on the Borrower;
and
(iii) any such alternative basis may include an alternative
method of fixing the interest rate,
alternative Interest Periods or alternative currencies but it
must reflect the cost to the
Revolving Credit Banks of funding the Loan from whatever sources
they may select
plus the Margin plus any Mandatory Cost.
(c) The Facility Agent shall consult with the Borrower at
least once every 14 days after the
occurrence and during the continuance of the circumstances
specified in the foregoing
provisions of this Clause 13 with a view to reverting to the
normal provisions for the
determination of the rates of interest applicable to any Loan.
14. INCREASED COSTS
14.1 Increased costs
(a) Subject to Clause 14.2 (Exceptions), the Borrower shall
within five Business Days of a demand
by a Bank pay to that Bank the amount of any increased cost
incurred by it or its holding
company as a result of any change in or change in the
interpretation or application of any law
or regulation (including any law or regulation relating to
taxation, or reserve asset, special
deposit, cash ratio, liquidity or capital adequacy requirements
or any other form of banking or
monetary control). Any such demand shall set out in reasonable
detail the calculation and the
cause of the amounts claimed and contain confirmation that the
affected Bank is taking the
same approach in relation to the majority of its other facilities
of a similar nature.
(b) In this Agreement "increased cost" means:
(i) an additional cost incurred by a Bank or its holding
company as a result of that Bank
having entered into, or performing, maintaining or funding its
obligations under, this
Agreement; or
(ii) that portion of an additional cost incurred by a Bank or
its holding company in that
Bank making, funding or maintaining all or any advances comprised
in a class of
advances formed by or including the Loans made or to be made
under this Agreement
as is attributable to it or its holding company in that Bank
making, funding or
maintaining the Loans; or
(iii) a reduction in any amount payable to a Bank or its
holding company or the effective
return to a Bank or its holding company under this Agreement or
on its capital; or
(iv) the amount of any payment made by a Bank or its holding
company, or the amount of
any interest or other return foregone by a Bank or its holding
company, calculated by
reference to any amount received or receivable by a Bank under
this Agreement.
14.2 Exceptions
Clause 14.1 (Increased costs) does not apply to any increased
cost:-
(a) compensated for by the payment of the Mandatory Cost;
(b) compensated for by the operation of Clause 12 (Taxes) or
which would have been
compensated under that Clause but for the operation of Clause
12.4 (Exceptions from
gross-up);
(c) attributable to any change in the rate of tax on the
overall net income of a Bank;
(d) occurring as a result of any negligence or default of a
Bank, including, without
limitation, a breach by a Bank of any fiscal, monetary or capital
adequacy limit
imposed on it by any law or regulation; or
(e) occurring as a result of a transfer or novation of a
Bank's rights or obligations under
this Agreement; or
(f) any increased cost attributable to any implementation of
the proposals contained in any
of:-
(i) the statement of the Basle Committee on Banking
Regulations and Supervisory
Practices dated July 1988 and entitled "International Convergence
of Capital
Measurement and Capital Standards"; or
(ii) the EC Solvency Ratio Directive, EC Own Funds Directive,
or EC Capital
Adequacy Directive or any law, regulation, rule, official
directive, request or
guideline (whether or not having the force of law) of any
governmental body,
central bank, agency, department, regulatory, self-regulatory or
other authority
in any jurisdiction, implementing, applying or supplementing any
of them with
which a Bank complies or is required to comply,
in each case as published before the date of this Agreement
unless it results from any
change in, or change in the interpretation of or application of,
that statement, Directive,
law, regulation, rule, official directive, request or guideline
after the date of this
Agreement.
15. ILLEGALITY AND MITIGATION
15.1 Illegality
If it is or becomes unlawful in any jurisdiction for a Bank to
give effect to any of its obligations
as contemplated by this Agreement or to fund or maintain its
participation in any Loan, then:-
(a) that Bank may notify the Borrower through the Facility
Agent accordingly; and
(b) (i) the Borrower shall forthwith prepay the
participations of that Bank in all or
part of the Loans made to it to the extent necessary to avoid the
relevant
illegality, together with accrued interest on that portion of
those Loans; and
(ii) the undrawn Commitments of that Bank shall be reduced to
such amount as
would be lawful or (if no such amount would be lawful) to zero,
in each case, on or before the last day before the relevant
unlawfulness takes effect.
15.2 Mitigation
If circumstances arise which would, or would on the giving of
notice, result in:-
(a) any additional amounts becoming payable under Clause 12
(Taxes); or
(b) any amount becoming payable under Clause 14 (Increased
costs); or
(c) any prepayment, early payment or cancellation under
Clause 15.1 (Illegality),
then, without limiting the obligations of the Borrower under this
Agreement and without
prejudice to the terms of Clauses 12 (Taxes), 14 (Increased
costs) and 15.1 (Illegality), the
affected Finance Party may, in consultation with the Borrower,
take such steps as may
reasonably be open to it to mitigate or remove such circumstance,
including (without limitation)
the transfer of its rights and obligations under this Agreement
to another branch or another
bank or financial institution acceptable to the Borrower, unless
to do so would (in the sole
opinion of the affected Finance Party) be prejudicial to it.
16. REPRESENTATIONS AND WARRANTIES
16.1 Representations and warranties
The Borrower makes the representations and warranties set out in
this Clause 16
(Representations and warranties) to each Finance Party.
16.2 Status
(a) It is a limited liability company, duly incorporated and
validly existing under the laws of
England;
(b) each member of the Group has the power to own its assets
and carry on its business as it is
being conducted;
(c) Each Licence Holder has been duly licensed and authorised
by the Secretary of State under
Section 6(I)(c) of the Act for the generation, distribution
and/or supply of electricity and the
Licence is in full force and effect.
16.3 Powers and authority
It has the power to enter into and perform, and has taken all
necessary action to authorise the
entry into, performance and delivery of, the Finance Documents to
which it is or will be a party
and the transactions contemplated by those Finance Documents.
16.4 Legal validity
Except as stated in any qualifications as to matters of law in
any legal opinion referred to in
Schedule 2, each Finance Document to which it is or will be a
party constitutes, or when
executed in accordance with its terms will constitute, its legal,
valid and binding obligation.
16.5 Non-conflict
(a) The entry into and performance by it of, and the
transactions contemplated by, the Finance
Documents do not and will not conflict with the Licence in any
material respect.
(b) The entry into and performance by it of, and the
transactions contemplated by, the Finance
Documents do not and will not:-
(i) conflict with any law or regulation or authorisation or
judicial or official order in any
material respect; or
(ii) conflict with the constitutional documents of any member
of the Group; or
(iii) conflict with the Licence or any document which is
binding upon any member of the
Group or any asset of any member of the Group to an extent or in
a manner which
would have a Material Adverse Effect.
16.6 No default
No Event of Default or Default is outstanding which has not been
remedied or waived or would
result from the making of any Loan.
16.7 Authorisations
All authorisations which are necessary for the entry into,
performance and validity of, and the
transactions contemplated by, the Finance Documents have been
obtained or effected (as
appropriate) and are in full force and effect.
16.8 Accounts
On and from the date that audited consolidated accounts of
the Group are first delivered to the
Facility Agent under Clause 17.2 (Financial information), the
audited consolidated accounts of
the Group most recently delivered to the Facility Agent:-
(i) have been prepared in accordance with accounting
principles and practices generally
accepted in the United Kingdom; and
(ii) (in conjunction with the notes thereto) give a true and
fair view of the consolidated
financial condition of the Group as at the date to which they
were drawn up.
16.9 Material adverse change
Since the date as at which the most recent audited
consolidated financial statements of YPG
were stated to be prepared, there has been no material adverse
change in the financial condition
of Group taken as a whole.
16.10 Litigation
Save as disclosed in writing to the Facility Agent prior to the
date of this Agreement no
litigation or arbitration is current or, to its knowledge,
pending or has been threatened in
writing, which are likely to be determined adversely to it and,
if so determined, might
reasonably be likely to have a Material Adverse Effect.
16.11 Licence
(a) The Licence is in full force and effect and there exist
no material breaches of the terms of the
Licence.
(b) There are no circumstances in existence which would be
likely to lead the Director General or
the Secretary of State to seek to revoke the Licence except in
each case where the relevant
event or circumstances would not have a Material Adverse Effect.
(c) YEG has not breached:
(i) any requirement of the Act or any regulations made
thereunder; or
(ii) any other statutory requirement or any final order or
confirmed provisional order in
each case made under the Act; or
(iii) any undertaking given by it to the Director General or
the Secretary of State in relation
to the conduct of its business as a generator of electricity or
as a public electricity
supplier (as the case may be),
the consequence of which is reasonably likely to have a Material
Adverse effect.
(d) Neither the Director General nor the Secretary of State
has given notice to revoke a Licence.
(e) Save as described in writing to the Agent no amendment of
any of the terms of a Licence has
been made or proposed which is reasonably likely to have a
Material Adverse Effect.
16.12 Information
To the best of the knowledge of the Borrower after due enquiry:
(a) the factual information contained in Sections 4, 5 and 6
of the Information
Memorandum (other than the information referred to in paragraph
(b) below) was true
in all material respects as at its date;
(b) the factual information contained in the Information
Memorandum which has been
taken from the SEC filing dated 3rd June, 1998 was true in all
material respects as at
the date of that SEC filing;
(c) all estimates and projections contained in the
Information Memorandum were prepared
by the Borrower based upon assumptions that the Borrower
considered to be
reasonable as at the date of their preparation and on the basis
of information available
to the Borrower provided by third parties the Borrower believed,
in each case, to be
reliable, except that no representation is made that these
estimates or projections will
be achieved;
(d) the Information Memorandum did not omit as at its date
any information which renders
the information contained in it untrue or misleading in any
material respect; and
(e) as at the date of the Credit Agreement, nothing has
occurred since the date of the
Information Memorandum which renders the factual information
contained in Sections
4, 5 and 6 of the Information Memorandum untrue or misleading in
any material
respect.
16.13 Times for making representations and warranties
The representations and warranties set out in this Clause 16
(Representations and warranties):-
(a) are made on the date of this Agreement; and
(b) (other than the representations in Clauses 16.2(c)
(Status), 16.5(a) (Non-conflict),16.9
(Material adverse change), 16.10 (Litigation), 16.11(c) to (e)
(Licence) and 16.12
(Information)) are deemed to be repeated by the Borrower on the
date of each Request
made by it and the first day of each Interest Period of a Loan
made to it with reference
to the facts and circumstances then existing but as if the words
in Clause 16.6 (No
default) "or Default" had been deleted.
17. UNDERTAKINGS
17.1 Duration
The undertakings in this Clause 17 (Undertakings) remain in force
from the date of this
Agreement for so long as any amount is or may be outstanding
under this Agreement or any
Commitment is in force.
17.2 Financial information
The Borrower shall supply to the Facility Agent (with sufficient
copies for all the Banks):-
(a) as soon as the same are available (and in any event
within 180 days of the end of each
of its financial years), the audited consolidated accounts of the
Group and for YPG for
that financial year;
(b) as soon as the same are available (and in any event
within 90 days of the end of the
first half-year of each of its financial years), the unaudited
consolidated accounts of the
Group and for YPG for that half-year; and
(c) together with the accounts specified in paragraphs (a)
and (b) above, a certificate
signed by two of its directors on its behalf setting out in
reasonable detail computations
establishing compliance with Clause 17.14 (Financial covenants);
and
(d) as soon as the same are available (and in any case within
60 days of the end of each
relevant financial quarter of each of its financial years), the
unaudited quarterly
accounts required to be registered by YPG with the U.S.
Securities and Exchange
Commission,
and all such accounts supplied under paragraphs (a) or (b) above
shall be prepared in
accordance with accounting principles generally accepted in the
United Kingdom.
17.3 Information - Miscellaneous
The Borrower shall supply to the Facility Agent (with sufficient
copies for all the Banks, if the
Facility Agent so requests):-
(a) all documents despatched by it to its creditors generally
or (if it is not a close company
within the meaning of Section 414 of the Income and Corporation
Taxes Act, 1988) to
its shareholders generally (or any class of its shareholders
generally) at the same time
as they are despatched;
(b) promptly upon becoming aware of them, details of any
litigation, arbitration or
administrative proceedings which are current, threatened in
writing or pending, and
which if they had been current or threatened in writing on the
date of this Agreement
would have resulted in the representation in Clause 16.10
(Litigation) being incorrect
in any material respect; and
(c) promptly upon becoming aware that any modifications to
the Licence are being
proposed by the Director General or the Secretary of State,
reasonable details thereof,
to be updated from time to time to reflect any changes, provided
that such details shall
be required to be reported to the Agent hereunder, only to the
extent that if such
proposed modifications were to be made to the Licence, compliance
with such
modification or undertaking would have a Material Adverse Effect.
17.4 Notification of Default
The Borrower shall notify the Facility Agent of any Default or
Event of Default affecting it
(and the steps, if any, being taken to remedy it) promptly upon
its occurrence.
17.5 Compliance certificates
The Borrower shall supply to the Facility Agent:-
(a) together with the accounts specified in Clause 17.2(a)
(Financial information); and
(b) promptly if the Facility Agent so requests (but no more
often than twice in a calendar
year (excluding the certificate under paragraph (a) above)),
a certificate signed by two of its directors on its behalf
certifying that no Default is outstanding
or, if a Default is outstanding, specifying the Default and the
steps, if any, being taken to
remedy it.
17.6 Authorisations
The Borrower shall:-
(a) use all reasonable endeavours to obtain, maintain and
comply in all material respects
with the terms of; and
(b) (if requested) supply certified copies to the Facility
Agent of,
any authorisation required under any law or regulation to enable
it to perform its obligations
under, or for the validity or admissibility in evidence of, any
Finance Document.
17.7 Pari passu ranking
The Borrower shall procure that its obligations under the Finance
Documents do and will rank
at least pari passu with all its other present and future
unsecured obligations, except for taxes,
national insurance contributions, local or water authority rates
and employee remuneration and
benefits which are mandatorily preferred by law applying to
companies generally or by the Act.
17.8 Negative pledge
(a) The Borrower shall not and shall procure that no
Subsidiary will, create or permit to subsist
any Security Interest on any of its assets.
(b) Paragraph (a) does not apply to Permitted Security
Interests or to Security Interests arising
under the Act.
17.9 Disposals
The Borrower shall not, and shall procure that no other
Subsidiary of the Borrower shall, either
in a single transaction or in a series of transactions, whether
related or not and whether
voluntarily or involuntarily, sell, transfer, grant or lease or
otherwise dispose of all or any
substantial part of the assets of the Group.
The paragraph above does not apply to:
(a) sales, conveyances, transfers or other disposals in the
ordinary course of business on
arm's length terms or otherwise at market value; or
(b) sales, conveyances, transfers or other disposals the
aggregate book value of which is at
the time of the final such disposal in any financial year 7.5% or
less of Adjusted Share
Capital and Reserves (less the Preferred Securities); or
(c) disposals to another member of the Group provided that
such disposals shall only be
made to:
(A) a wholly owned Subsidiary of the Borrower;
(B) another person who immediately after such disposal
becomes a wholly owned
subsidiary of the Borrower; or
(C) another member of the Group if the interest of the
Borrower in that transferee
is no less than its interest in the transferor; or
(d) disposals of assets in exchange for other assets similar
as to type and value or where
all or a substantial part of the net proceeds of such disposal
are used within 60 days of
the disposal (or such longer period as the Majority Banks may
agree) in the acquisition
of such assets; or
(e) disposals of cash raised or borrowed or temporary
investments representing surplus
funds; or
(f) the expenditure of cash in the ordinary course of
business including, without limitation,
for the repayment of any debt or the acquisition of any asset; or
(g) the payment of any dividend or distribution whatsoever
and whether extraordinary or
special in nature or otherwise, in each case, in cash or in
specie; or
(h) disposals on normal commercial terms of old and/or
obsolete plant or equipment; or
(i) any distribution of the surplus assets of a Subsidiary
(not being a Principal Subsidiary)
in a liquidation or winding up not involving insolvency; or
(j) disposals (with or without recourse) of receivables at
arm's length and on normal
commercial terms (or by way of securitisation or monetisation)
provided that:
(A) the majority of the proceeds from that disposal are used
to repay the YPG
Facility and this Agreement in the following order:
first, Facility A;
second, any other loan owing by YPG under the YPG Facility;
third, any other amount under the YPG Facility or this Agreement
designated
by YEG; and
(B) that disposal would not of itself be reasonably likely to
result in a breach of the
Borrower's obligations under Clause 17.14 (Financial covenants)
either at the
time of the disposal or following the disposal; or
(k) the sale at arm's length or otherwise at market value of
the any of the shares in
Ionica PLC owned by the Borrower; or
(l) the sale at arm's length of power generation assets owned
by members of the Group; or
(m) with the prior written consent of the Majority Banks.
17.10 Change of business
Unless the Facility Agent (acting on the instructions of the
Majority Banks) otherwise agrees or
the change arises by operation of law, the Borrower shall not
permit the Group as a whole to
make any substantial change in the nature of its business as a
distributor and/or supplier of
electricity within its authorised area which, when taken
together, would account for more than
10 per cent. of the consolidated gross assets and/or turnover of
the Group.
17.11 Restriction on Borrowings
No member of the Group will incur or have outstanding any
Borrowings other than:
(a) under the Finance Documents;
(b) for the purpose of refinancing the Facility in full on
the date on which such Borrowings
are first utilised;
(c) for the purpose of refinancing part of the Facility;
(d) Borrowings owing by one member of the Group to another
member of the Group;
(e) Subordinated Debt;
(f) Borrowings secured under paragraph (c) of the definition
of Permitted Security
Interests up to the amount set out in sub-paragraph (c)(i) of
that definition unless that
Security Interest is to be discharged under sub-paragraph (c)(ii)
of that definition;
(g) Borrowings under any recourse disposal of receivables
where that disposal is permitted
under Clause 17.9(j) (Disposals);
(h) Project Finance Borrowings; or
(i) with the prior written consent of the Majority Banks;
(j) any other Borrowings of the Borrower or any of its
Subsidiaries in an amount which,
after deducting Investments of the Borrower or any of its
Subsidiaries do not exceed in
aggregate (POUND)700,000,000 (including under the Finance
Documents and the YPG
Facility).
17.12 Environmental Matters
The Borrower will, and will ensure that each member of the Group
will:
(a) obtain all necessary Environmental Licences and comply in
all material respects with
(i) the terms and conditions of all Environmental Licences
applicable to it and (ii) all
other applicable Environmental Laws in each case where failure to
do so would have a
Material Adverse Effect;
(b) promptly upon receipt of the same, notify the Facility
Agent of any claim, notice or
other communication served on it in respect of any alleged breach
of or corrective or
remedial obligation or liability under any Environmental Law
which would or would be
likely to or (in the case of an alleged breach), if
substantiated, would have a Material
Adverse Effect.
17.13 Licence
(a) To the extent that there would otherwise be a Material
Adverse Effect, the Borrower shall, and
shall ensure that each Licence Holder shall, comply with all
terms and conditions of the
Licence and with the requirements of all laws, rules,
regulations, orders and other requirements
for the time being of the Secretary of State and the Director
General applicable to Licence
Holder with which it is obliged to comply; and
(b) The Borrower will promptly notify the Facility Agent of
any amendments to the Licence
occurring after the date of this Agreement (other than those of a
minor and/or technical nature).
17.14 Financial covenants
The Borrower shall procure that EBITDA for any Relevant Period
shall not be less than 2.5
times Net Interest Payable for that Relevant Period.
17.15 Licence undertakings
The Borrower shall promptly supply to the Agent:
(a) copies of all notices or orders served on it by the
Director General or the Secretary of
State in exercise of the powers conferred on him by the Act to
the extent the same
might reasonably be expected to have a Material Adverse Effect;
(b) details of any references relating to it to the
Monopolies and Mergers Commission
after the date of this Agreement; and
(c) details of the exercise by the Secretary of State or the
Director General of the powers
conferred on them by the Fair Trading Xxx 0000, the Competition
Xxx 0000 and/or
Section 12 of the Act relating to it or any business carried on
by it and regulated
thereby,
17.16 Change of basis
If, at any time, the Borrower changes or proposes to change in
any material respect the basis
upon which the Group's audited annual consolidated accounts are
prepared (whether or not by
reason of a change in accounting standards or otherwise), then:-
(a) the Borrower shall promptly notify the Facility Agent of
the change or proposed
change;
(b) subject to paragraph (c) below, the Borrower shall
calculate the financial covenants
under Clause 17.14 (Financial covenants) on the basis of the
accounting standards
used for the Original Group Accounts and shall provide
appropriate calculations with
the certificates delivered under Clause 17.2(c) (Financial
information) to show the
reconciliations and adjustments that have been made as a result
of the change in
accounting standards; and
(c) if the Borrower so requests at any time:-
(i) the Borrower and the Facility Agent shall enter
into discussions for a period of
not more than 45 days with a view to agreeing the amendments
which would
be required to be made to Clause 17.14 (Financial Covenants) to
procure that,
as far as possible, the Borrower and the Banks are in no worse
position than
they would have been in if the change in accounting standards had
not
occurred,
(ii) any agreement between the Borrower and the Facility Agent
under sub-
paragraph (i) above shall be, with the prior consent of the
Majority Banks,
binding on all the Parties; and
(iii) if no agreement is reached under sub-paragraph (i) above,
then the Borrower's
auditors shall certify the amendments which would be required to
be made to
this Agreement to place the Borrower, the Borrower and the Banks
in the same
position they would have been in if the change had not taken
place; a
certificate of the auditors in accordance with the above will, in
the absence of
manifest error, be binding on all the Parties.
18. DEFAULT
18.1 Events of Default
Each of the events set out in Clauses 18.2 (Non-payment) to 18.15
(Expropriation) (inclusive)
is an Event of Default (whether or not caused by any reason
whatsoever outside the control of
the Borrower or any other person).
18.2 Non-payment
The Borrower does not pay any amount payable by it under the
Finance Documents on the due
date at the place at and in the currency in which it is expressed
to be payable and, but only if
such failure is due solely to administrative error or technical
difficulties, such non payment is
not remedied within 3 Business Days.
18.3 Breach of other obligations
(a) The Borrower does not comply with the provisions of
Clause 17.14 (Financial covenants).
(b) The Borrower does not comply with any provision of the
Finance Documents (other than those
referred to in paragraph (a) above or Clause 18.2 (Non-payment))
and such default, if capable
of remedy, is not remedied within 25 days after the earlier of
the date upon which the Borrower
became aware of the same and the date on which the Borrower
receives notice from the Facility
Agent requiring remedy.
18.4 Misrepresentation
A representation, warranty or statement made or repeated in or in
connection with any Finance
Document or in any document delivered by or on behalf of the
Borrower under or in connection
with any Finance Document is incorrect in any respect when made
or deemed to be made or
repeated.
18.5 Cross-default
(a) Any Borrowings of a member of the Group are not paid when
due; or
(b) an event of default howsoever described occurs under any
document relating to Borrowings of
a member of the Group and any financier to which those Borrowings
are owed takes any step
to improve its commercial position, whether by charging a fee not
provided for in the original
document evidencing those Borrowings, or seeking more onerous
provisions in that document;
or
(c) any Borrowings of a member of the Group become
prematurely due and payable or are placed
on demand as a result of an event of default under the document
relating to those Borrowings,
and the aggregate principal amount of Borrowings or amounts
referred to in paragraphs (a) to
(c) (inclusive) above exceeds (POUND)15,000,000 or its equivalent
in any other currency.
18.6 Administration
(a) The Borrower or any Principal Subsidiary passes an
effective resolution to present an
application for an administration order; or
(b) an application for an administration order in relation to
the Borrower or a Principal Subsidiary
is presented to the court unless the application is being
contested in good faith on reasonable
grounds by appropriate proceedings; or
(c) an administration order is made in relation to the
Borrower or any Principal Subsidiary.
18.7 Insolvency
The Borrower or any Principal Subsidiary has any voluntary
arrangement proposed in relation
to it under Section 1 of the Insolvency Xxx 0000, or enters into
any other composition, scheme
of arrangement, compromise or arrangement involving such company
and its respective
creditors generally (other than for the purposes of
reconstruction or amalgamation or other
similar arrangement).
18.8 Insolvency proceedings
(a) The Borrower or any Principal Subsidiary passes an
effective resolution for its winding up
other than a resolution previously approved in writing by the
Facility Agent; or
(b) a petition for the winding up of the Borrower or any
Principal Subsidiary is presented to the
court and either:
(i) such company does not apply to the court within 30 days
after the presentation of such
petition requesting the court to refuse such petition; or
(ii) it does so apply but such petition is not refused by such
court within 60 days after such
application for the refusal of such petition or any such company
becomes subject to a
winding up order,
provided that nothing in this Clause 18.8 shall apply to a
solvent reconstruction, amalgamation
or reorganisation of a Principal Subsidiary.
18.9 Appointment of receivers and managers
Any liquidator, trustee in bankruptcy, compulsory manager,
receiver, administrative receiver,
administrator or the like is appointed in respect of the Borrower
or any Principal Subsidiary or
any material part of its assets or undertaking or the directors
of the Borrower or a Principal
Subsidiary request the appointment of a liquidator, trustee in
bankruptcy, compulsory manager,
receiver, administrative receiver, administrator or the like
(other than an appointment to which
the Facility Agent has approved pursuant to Clause 18.8
(Insolvency proceedings)).
18.10 Unlawfulness
It is or becomes unlawful for the Borrower to perform any of its
obligations under the Finance
Documents.
18.11 Licence
(a) Any modification (other than a modification which is of a
minor or technical nature) is made to
the terms and conditions of the Licence and such modification
would be expected to have a
Material Adverse Effect; or
(b) the Licence (excluding any second tier supply licence) is
surrendered by the Licence Holder or
is revoked by the Secretary of State or a notice from the
Secretary of State is given to that
effect in accordance with its terms or it otherwise ceases to be
in full force and effect and, in
each case, the Licence is not replaced on substantially similar
terms except where such
surrender, cessation or revocation has been agreed between the
Borrower and the Secretary of
State and consented to by the Majority Banks and provided that
the giving of notice pursuant to
paragraph 3 of Part 1 of the Licence shall not be deemed to
constitute the revocation of the
Licence.
18.12 Pooling and Settlement Agreement
Any notice requiring the Borrower to cease to be a party to the
Pooling and Settlement
Agreement is given to the Borrower under clause 66.1.3 or 66.2.2
of the Pooling and
Settlement Agreement, or the Borrower otherwise ceases to be a
party to that agreement and
the same has a Material Adverse Effect, unless the Borrower or
any of its Subsidiaries enters
into arrangements which replace the Pooling and Settlement
Agreement for electricity trading
and settlement within the electricity industry and those
replacement arrangements do not have a
Material Adverse Effect.
18.13 Compliance with the Act
YEG fails to comply with a final order (within the meaning
of Section 25 of the Act) or with a
provisional order (within the meaning of that section) which has
been confirmed under that
section (and not since been revoked) or any provisions of the Act
detailing the rights, powers,
authorities, obligations and duties of the Secretary of State or
the Director General or the
manner in or time at which they are to be exercised, are repealed
or amended in a manner
which has (or is likely to have) a Material Adverse Effect.
18.14 Ownership of the Borrower
The Borrower is not or ceases to be a direct or indirect
wholly owned Subsidiary of YH.
18.15 Expropriation
All or a substantial part of the assets of the Borrower shall be
seized, renationalised or
expropriated by any governmental authority.
18.16 Acceleration
On and at any time after the occurrence of an Event of Default
while the same is continuing,
unremedied or unwaived the Facility Agent may (and, shall if so
directed by the Majority
Banks), by notice to the Borrower:
(a) cancel the Total Revolving Credit Commitments and the
Total Swingline
Commitments; and/or
(b) demand that all or part of the Loans, together with
accrued interest and all other
amounts accrued under this Agreement be immediately due and
payable, whereupon
they shall become immediately due and payable; and/or
(c) demand that all or part of the Loans be payable on
demand, whereupon they shall
immediately become payable on demand by the Facility Agent acting
on the
instructions of the Majority Banks.
19. THE AGENT AND THE ARRANGERS
19.1 Appointment and duties of the Facility Agent
(a) Each Finance Party (other than the Facility Agent)
irrevocably appoints the Facility Agent to
act as its agent under and in connection with the Finance
Documents.
(b) Each Swingline Bank irrevocably appoints the Swingline
Agent to act as its agent under this
Agreement in connection with the Swingline Facility.
(c) Each Party appointing an Agent irrevocably authorizes
that Agent on its behalf to:
(i) perform the duties and to exercise the rights, powers and
discretions that are
specifically delegated to it under or in connection with the
Finance Documents,
together with any other incidental rights, powers and
discretions; and
(ii) execute each Finance Document expressed to be executed by
that Agent on that Party's
behalf.
(d) The Agents shall have only those duties which are
expressly specified in the Finance
Documents. Those duties are solely of a mechanical and
administrative nature.
19.2 Role of the Arrangers
Except as otherwise provided in the Finance Documents, the
Arrangers have no obligations of
any kind to any other Finance Party under or in connection with
any Finance Document.
19.3 Relationship
The relationship between an Agent and the other Finance Parties
is that of agent and principal
only. Nothing in this Agreement constitutes an Agent as trustee
or fiduciary for any other
Party or any other person and an Agent need not hold in trust any
moneys paid to it for a Party
or be liable to account for interest on those moneys.
19.4 Majority Banks' instructions
(a) Each Agent will be fully protected if it acts in
accordance with the instructions of the Majority
Banks in connection with the exercise of any right, power or
discretion or any matter not
expressly provided for in the Finance Documents. Any such
instructions given by the Majority
Banks will be binding on all the Banks. In the absence of such
instructions an Agent may act
as it considers to be in the best interests of all the Banks.
(b) No Agent is authorized to act on behalf of a Bank
(without first obtaining that Bank's consent)
in any legal or arbitration proceedings relating to any Finance
Document.
19.5 Delegation
Each Agent may act under the Finance Documents through its
personnel and agents.
19.6 Responsibility for documentation
No Agent or Arranger is responsible to any other Finance Party
for:-
(a) the execution, genuineness, validity, enforceability or
sufficiency of any Finance
Document or any other document;
(b) the collectability of amounts payable under any Finance
Document; or
(c) the accuracy of any statements (whether written or oral)
made in or in connection with
any Finance Document (including the Information Memorandum).
19.7 Default
(a) No Agent is obliged to monitor or enquire as to whether
or not a Default has occurred. No
Agent will not be deemed to have knowledge of the occurrence of a
Default. However, if an
Agent receives notice from a Party referring to this Agreement,
describing the Default and
stating that the event is a Default, it shall promptly notify the
Banks.
(b) An Agent may require the receipt of security satisfactory
to it whether by way of payment in
advance or otherwise, against any liability or loss which it will
or may incur in taking any
proceedings or action arising out of or in connection with any
Finance Document before it
commences these proceedings or takes that action.
19.8 Exoneration
(a) Without limiting paragraph (b) below, no Agent will be
liable to any other Finance Party for
any action taken or not taken by it under or in connection with
any Finance Document, unless
directly caused by its gross negligence or wilful misconduct.
(b) No Party may take any proceedings against any officer,
employee or agent of an Agent in
respect of any claim it might have against an Agent or in respect
of any act or omission of any
kind (including gross negligence or wilful misconduct) by that
officer, employee or agent in
relation to any Finance Document.
19.9 Reliance
Each Agent may:-
(a) rely on any notice or document believed by it to be
genuine and correct and to have
been signed by, or with the authority of, the proper person;
(b) rely on any statement made by a director or employee of
any person regarding any
matters which may reasonably be assumed to be within his
knowledge or within his
power to verify; and
(c) engage, pay for and rely on legal or other professional
advisers selected by it (including
those in an Agent's employment and those representing a Party
other than an Agent).
19.10 Credit approval and appraisal
Without affecting the responsibility of the Borrower for
information supplied by it or on its
behalf in connection with any Finance Document, each Bank
confirms that it:-
(a) has made 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 Agents or the Arrangers in connection with any Finance
Document; and
(b) will continue to make its own independent appraisal of
the creditworthiness of the
Borrower and its related entities while any amount is or may be
outstanding under the
Finance Documents or any Commitment is in force.
19.11 Information
(a) Each Agent shall promptly forward to the person concerned
the original or a copy of any
document which is delivered to that Agent by a Party for that
person.
(b) The Facility Agent shall promptly supply a Bank with a
copy of each document received by it
under Clause 4 (Conditions precedent) upon the request and at the
expense of that Bank.
(c) Except where this Agreement specifically provides
otherwise, no Agent is obliged to review or
check the accuracy or completeness of any document it forwards to
another Party.
(d) Except as provided above, no Agent has a duty:-
(i) either initially or on a continuing basis to provide any
Bank with any credit or other
information concerning the financial condition or affairs of the
Borrower or any related
entity of the Borrower whether coming into its possession before,
on or after the date
of this Agreement; or
(ii) unless specifically requested to do so by a Bank in
accordance with a Finance
Document, to request any certificates or other documents from the
Borrower.
19.12 The Agents and the Arrangers individually
(a) If it is also a Bank, each of the Agents and each
Arranger has the same rights and powers under
this Agreement as any other Bank and may exercise those rights
and powers as though it were
not an Agent or an Arranger.
(b) Each Agent and each Arranger may:-
(i) carry on any business with the Borrower or its related
entities;
(ii) act as agent or trustee for, or in relation to any
financing involving, the Borrower or its
related entities; and
(iii) retain any profits or remuneration in connection with its
activities under this
Agreement or in relation to any of the foregoing.
(c) In acting as an Agent, the agency division of each Agent
will be treated as a separate entity
from its other divisions and departments. Any information
acquired by an Agent which, in its
opinion, is acquired by it otherwise than in its capacity as the
Agent may be treated as
confidential by that Agent and will not be deemed to be
information possessed by it in its
capacity as such.
(d) The Borrower irrevocably authorizes each Agent to
disclose to the other Finance Parties any
information which is received by it in its capacity as an Agent.
(e) Each Agent may deduct from any amount received by it for
the Banks pro rata any unpaid fees,
costs and expenses of that Agent incurred by it in connection
with the Finance Documents.
19.13 Indemnities
(a) Without limiting the liability of any Borrower under the
Finance Documents, each Bank shall
forthwith on demand indemnify each Agent for that Bank's
proportion of any liability or loss
incurred by that Agent in any way relating to or arising out of
its acting as that Agent, except
to the extent that the liability or loss arises directly from
that Agent's gross negligence or wilful
misconduct.
(b) A Bank's proportion of the liability or loss set out in
paragraph (a) above is the proportion
which its participation in the Revolving Loans (if any) bear to
all the Revolving Loans
outstanding on the date of the demand. However, if there are no
Revolving Loans outstanding
on the date of demand, then the proportion will be the proportion
which its Revolving Credit
Commitment bears to the Total Revolving Credit Commitments at the
date of demand or, if the
Total Revolving Credit Commitments have been cancelled, bore to
the Total Revolving Credit
Commitments immediately before being cancelled.
19.14 Compliance
(a) Each Agent may refrain from doing anything which might,
in its opinion, constitute a breach of
any law or regulation or be otherwise actionable at the suit of
any person, and may do anything
which, in its opinion, is necessary or desirable to comply with
any law or regulation of any
jurisdiction.
(b) Without limiting paragraph (a) above, no Agent need
disclose any information relating to the
Borrower or any of its related entities if the disclosure might,
in the opinion of that Agent,
constitute a breach of any law or regulation or any duty of
secrecy or confidentiality or be
otherwise actionable at the suit of any person.
19.15 Resignation of Agent
(a) Notwithstanding its irrevocable appointment, an Agent may
resign by giving notice to the
Banks and the Borrower, in which case that Agent may forthwith
appoint one of its Affiliates
as successor Agent or, failing that, the Majority Banks may
(after consultation with the
Borrower) appoint a successor Agent.
(b) If the appointment of a successor Agent is to be made by
the Majority Banks but they have not,
within 30 days after notice of resignation, appointed a successor
Agent which accepts the
appointment, the retiring Agent may (after consultation with the
Borrower) appoint a successor
Agent.
(c) The resignation of an Agent and the appointment of any
successor Agent will both become
effective only upon the successor Agent notifying all the Parties
that it accepts the appointment.
On giving the notification, the successor Agent will succeed to
the position of the relevant
Agent and the term "Agent" or "Swingline Agent", as appropriate
will mean the successor
Agent.
(d) The retiring Agent shall, at its own cost, make available
to the successor Agent such documents
and records and provide such assistance as the successor Agent
may reasonably request for the
purposes of performing its functions as an Agent under this
Agreement.
(e) Upon its resignation becoming effective, this Clause 19
shall continue to benefit the retiring
Agent in respect of any action taken or not taken by it under or
in connection with the Finance
Documents while it was an Agent, and, subject to paragraph (d)
above, it shall have no further
obligation under any Finance Document.
(f) The Majority Banks may, by notice to an Agent, require it
to resign in accordance with
paragraph (a) above. In this event, that Agent shall resign in
accordance with paragraph (a)
above but it shall not be entitled to appoint one of its
Affiliates as successor Agent.
19.16 Banks
(a) The Agents may treat each Bank as a Bank, entitled to
payments under this Agreement and as
acting through its Office(s) until it has received not less than
five Business Days notice from a
Bank to the contrary.
(b) Each Revolving Bank, on the date on which it becomes a
party to this Agreement, represents to
the Agent and the Borrower that it is:
(i) either:
(A) not resident in the United Kingdom for United Kingdom tax
purposes; or
(B) a "bank" as defined in section 840A of the Income and
Corporation Taxes Act
1988 and resident in the United Kingdom; and
(ii) beneficially entitled to the principal and interest
payable by the Agent to it under this
Agreement,
and shall forthwith notify the Agent and the Borrower if either
representation ceases to be
correct.
20. FEES
20.1 Commitment fee
(a) The Borrower shall pay to the Facility Agent for each
Revolving Credit Bank a commitment
fee in the amount of 0.1 per cent. per annum on the undrawn,
uncancelled amount of that
Bank's Revolving Credit Commitment during the Commitment Period.
(b) Accrued commitment fee is payable quarterly in arrear.
Accrued commitment fee shall also
payable to the Facility Agent for the relevant Revolving Credit
Bank on the cancelled amount
of its Revolving Credit Commitment at the time any cancellation
comes into effect.
20.2 VAT
Any fee referred to in this Clause 20 is exclusive of any value
added tax or any other tax which
might be chargeable in connection with that fee. If any value
added tax or other tax is so
chargeable, it shall be paid by the Borrower at the same time as
it pays the relevant fee.
21. EXPENSES
21.1 Initial and special costs
The Borrower shall, within 10 days of a claim being made, pay the
Agents and the Arrangers
the amount of all reasonable costs and expenses (including, for
paragraph (a) below only, legal
fees only up to a maximum of as set out in the relevant Fee
Letter) properly incurred by any of
them in connection with:
(a) the negotiation, preparation, printing and execution of:
(i) this Agreement and any other documents referred to in
this Agreement;
(ii) any other Finance Document (other than a Novation
Certificate) executed after
the date of this Agreement; and
(b) any amendment, waiver, consent or suspension of rights
(or any proposal for any of the
foregoing) requested by or on behalf of the Borrower or, in the
case of Clause 2.5
(Change of currency), the Agents, and relating to a Finance
Document or a document
referred to in any Finance Document.
21.2 Enforcement Costs
The Borrower shall, within 10 days of demand, pay to each Finance
Party the amount of all
costs and expenses (including legal fees) incurred by it in
connection with the enforcement of,
or in preservation of any rights under, any Finance Document.
22. STAMP DUTIES
The Borrower shall within 10 Business Days of a demand pay to a
Finance Party the amount of
any liability it incurs in respect of any United Kingdom stamp,
registration and similar tax
which is or becomes payable in connection with the entry into,
performance or enforcement of
any Finance Document.
23. INDEMNITIES
23.1 Currency indemnity
(a) If a Finance Party receives an amount in respect of the
Borrower's liability under the Finance
Documents or if that liability is converted into a claim, proof,
judgment or order in a currency
other than the currency (the "contractual currency") in which the
amount is expressed to be
payable under the relevant Finance Document:
(i) the Borrower shall indemnify that Finance Party as an
independent obligation against
any loss or liability arising out of or as a result of the
conversion;
(ii) if the amount received by that Finance Party, when
converted into the contractual
currency at a market rate in the usual course of its business is
less than the amount
owed in the contractual currency, the Borrower shall forthwith on
demand pay to that
Finance Party an amount in the contractual currency equal to the
deficit; and
(iii) the Borrower shall pay to that Finance Party forthwith on
demand any exchange costs
and taxes payable in connection with any such conversion.
(b) The Borrower waives any right it may have in any
jurisdiction to pay any amount under the
Finance Documents in a currency other than that in which it is
expressed to be payable.
23.2 Other indemnities
(a) The Borrower shall, within 10 Business Days of a demand
pay to a Finance Party the amount
of any loss or liability which that Finance Party incurs as a
consequence of:
(i) the occurrence of any Event of Default;
(ii) the operation of Clause 18.16 (Acceleration); or
(iii) (other than by reason of negligence or default by a
Finance Party) a Loan not being
made after the Borrower has delivered a Request or a Loan (or
part of a Loan) not
being prepaid in accordance with a notice of prepayment.
The Borrower's liability in each case includes any loss or
expense on account of funds
borrowed, contracted for or utilised to fund any amount payable
under any Finance Document,
any amount repaid or prepaid or any Loan but excludes any loss of
margin.
(b) If any Finance Party receives or recovers any payment of
principal of a Loan or of an overdue
amount other than on the last day of the Interest Period relative
to that Loan or amount so
received or recovered, that Finance Party shall calculate the
difference between:
(i) the additional interest (excluding the Margin and
Mandatory Costs) which would have
been payable on the principal so received or recovered had it
been received or
recovered on the last day of the relevant Interest Period; and
(ii) the amount of interest which would have been payable to
that Finance Party on the last
day of that Interest Period in respect of the principal so
received or recovered if the
principal so received or recovered had been placed on deposit by
that Finance Party
earning interest at the Applicable Rate from (and including) the
Business Day of
receipt of that amount up to (but excluding) the last day of
applicable Interest Period.
If (i) is greater than (ii) then the Borrower shall, within five
Business Days of a demand from
the relevant Finance Party, pay to that Finance Party an amount
equal to the difference.
24. EVIDENCE AND CALCULATIONS
24.1 Accounts
Accounts maintained by a Finance Party in connection with this
Agreement are prima facie
evidence of the matters to which they relate.
24.2 Certificates and determinations
Any certification or determination by a Finance Party of a rate
or amount under this Agreement
is prima facie evidence of the matters to which it relates.
24.3 Calculations
Interest (including any applicable Mandatory Cost), default
interest payable pursuant to Clause
10.3 (Default interest) and the fee payable under Clause 20.1
(Commitment fee) accrue from
day to day and are calculated on the basis of the actual number
of days elapsed and a year of
365 days.
25. AMENDMENTS AND WAIVERS
25.1 Procedure
(a) Subject to Clause 25.2 (Exceptions), any term of the
Finance Documents may be amended or
waived with the agreement of the Borrower and the Majority Banks.
The Facility Agent may
effect, on behalf of any Finance Party, an amendment or waiver
permitted under this Clause.
(b) The Facility Agent shall promptly notify the other
Parties of any amendment or waiver effected
under paragraph (a) above, and any such amendment or waiver shall
be binding on all the
Parties.
25.2 Exceptions
(a) An amendment or waiver which relates to:-
(i) the definition of "Majority Banks" in Clause 1.1
(Definitions);
(ii) an extension of the date for, or a decrease in an amount
or a change in the currency of,
any payment to that Bank under the Finance Documents (including
the Margin and any
fee payable under Clause 20.1 (Commitment Fee));
(iii) an increase in that Bank's Commitment;
(iv) a term of a Finance Document which expressly requires the
consent of that Bank; or
(v) Clause 2.2 (Nature of a Finance Party's rights and
obligations), Clause 26.1 (Transfers
by the Borrower), Clause 29 (Pro rata sharing) or this Clause 25,
is not binding unless all the Banks agree to it.
(b) An amendment or waiver which relates to the rights and/or
obligations of an Facility Agent
may not be effected without the agreement of that Facility Agent.
25.3 Waivers and remedies cumulative
The rights of each Finance Party under the Finance Documents:-
(a) may be exercised as often as necessary;
(b) are cumulative and not exclusive of its rights under the
general law; and
(c) may be waived only in writing and specifically.
Delay in exercising or non-exercise of any such right is not a
waiver of that right.
26. CHANGES TO THE PARTIES
26.1 Transfers by the Borrower
The Borrower may not assign, transfer, novate or dispose of any
of, or any interest in, its rights
and/or obligations under the Finance Documents.
26.2 Transfers by Banks
(a) A Bank (the "Existing Bank") may, subject to paragraph
(b) below, at any time assign,
transfer or novate any of its Commitments and/or any of its
rights and/or obligations under this
Agreement to another bank or financial institution (the "New
Bank").
(b) (i) After the Syndication Period, a transfer of a
Commitment must be in a minimum
amount of at least (POUND)5,000,000;
(ii) no transfer of a Commitment shall take place unless the
Existing Bank simultaneously
transfers to the New Bank the same proportion of its other
Commitment and of each of
its commitments under the YPG Facility; and
(iii) no transfer by a Bank of its Revolving Credit Commitment
may result in its Swingline
Commitment or that of its Affiliated Bank exceeding its Revolving
Credit
Commitment;
(iv) a Bank may only transfer its Swingline Commitment to a
New Bank if the New Bank
is, or will be, a Revolving Credit Bank or an Affiliate of a
Revolving Credit Bank; and
(v) the prior consent of the Borrower is required for any
such assignment, transfer or
novation, unless the New Bank is another Bank or an Affiliate of
a Bank, provided that
no consent of the Borrower is required during the Syndication
Period if the Borrower
has been consulted by the Arrangers on the approach to that New
Bank.
(c) A transfer of obligations will be effective only if
either:-
(i) the obligations are novated in accordance with Clause
26.3 (Procedure for novations);
or
(ii) the New Bank confirms to the Facility Agents and the
Borrower that it undertakes to
be bound by the terms of this Agreement as a Bank in form and
substance satisfactory
to the Facility Agents. On the transfer becoming effective in
this manner the Existing
Bank shall be relieved of its obligations under this Agreement to
the extent that they
are transferred to the New Bank.
(d) No Bank shall sub-participate any of its obligations
under this Agreement without the prior
written consent of the Borrower.
(e) On each occasion an Existing Bank assigns, transfers or
novates any of its Commitment and/or
any of its rights and/or obligations under this Agreement (other
than under the Novation
Agreement), the New Bank shall, on the date the assignment,
transfer and/or novation takes
effect, pay to the Facility Agent for its own account a fee of
(POUND)750.
(f) An Existing Bank is not responsible to a New Bank for:-
(i) the execution, genuineness, validity, enforceability or
sufficiency of any Finance
Document or any other document;
(ii) the collectability of amounts payable under any Finance
Document; or
(iii) the accuracy of any statements (whether written or oral)
made in or in connection with
any Finance Document.
(g) Each New Bank confirms to the Existing Bank and the other
Finance Parties that it:-
(i) has made 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 Bank 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 while any amount is or may be
outstanding under the
Finance Documents or any Commitment is in force.
(h) Nothing in any Finance Document obliges an Existing Bank
to:-
(i) accept a re-transfer from a New Bank of any of the rights
and/or obligations assigned,
transferred or novated under this Clause; or
(ii) support any losses incurred by the New Bank by reason of
the non-performance by the
Borrower of its obligations under the Finance Documents or
otherwise.
(i) Any reference in this Agreement to a Bank includes a New
Bank, but excludes a Bank if no
amount is or may be owed to or by that Bank under this Agreement
and its Commitment has
been cancelled or reduced to nil.
26.3 Procedure for novations
(a) A novation is effected if:-
(i) the Existing Bank and the New Bank deliver to the
Facility Agent a duly completed
Novation Certificate and the Facility Agent executes it; or
(ii) a Novation Agreement is executed by all the parties to
it.
(b) Each Party (other than the Existing Bank and the New
Bank) irrevocably authorizes the
Facility Agent to execute any duly completed Novation Certificate
on its behalf.
(c) To the extent that they are expressed to be the subject
of the novation in the Novation
Certificate or Novation Agreement
(i) the Existing Bank and the other Parties (the "existing
Parties") will be released from
their obligations to each other (the "discharged obligations");
(ii) the New Bank and the existing Parties will assume
obligations towards each other
which differ from the discharged obligations only insofar as they
are owed to or
assumed by the New Bank instead of the Existing Bank;
(iii) the rights of the Existing Bank against the existing
Parties and vice versa (the
"discharged rights") will be cancelled; and
(iv) the New Bank and the existing Parties will acquire rights
against each other which
differ from the discharged rights only insofar as they are
exercisable by or against the
New Bank instead of the Existing Bank,
all on the date of execution of the Novation Certificate or
Novation Agreement by the Facility
Agent or, if later, the date specified in the Novation
Certificate or Novation Agreement .
26.4 Reference Banks
If a Reference Bank (or, if a Reference Bank is not a Bank, the
Bank of which it is an Affiliate)
ceases to be a Bank, the Facility Agent shall (in consultation
with the Borrower) appoint
another Bank or an Affiliate of a Bank to replace that Reference
Bank.
26.5 Register
The Facility Agent shall keep a register of all the Parties and
shall supply any other Party (at
that Party's expense) with a copy of the register on request.
27. DISCLOSURE OF INFORMATION
Any information supplied to a Finance Party pursuant to or in
connection with this Agreement
shall be held in confidence and shall not be disclosed by it to
any person other than an Affiliate
of that Finance Party without the prior written consent of the
Borrower except:
(a) to that Finance Party's legal or other professional
advisers to the extent required for the
purposes of protecting its rights hereunder or by law or
regulation or pursuant to
applicable reporting requirements or any order of any court or to
bank supervisory
authorities or examining authorities unless it is or becomes a
matter of public
knowledge otherwise than as a result of a breach by it of its
obligations hereunder; or
(b) by the Arrangers to a financial institution during the
Syndication Period in connection
with the syndication of the Facility, provided that the Borrower
has been consulted by
the Arrangers on the approach to that financial institution.
28. SET-OFF
A Finance Party may set off any matured obligation owed by
the Borrower under this
Agreement (to the extent beneficially owned by that Finance
Party) against any credit balance
owed by that Finance Party to the Borrower, regardless of the
place of payment, booking
branch or currency of either obligation. If the obligations are
in different currencies, a Finance
Party may convert either obligation at a market rate of exchange
in its usual course of business
for the purpose of the set-off.
29. PRO RATA SHARING
29.1 Redistribution
If any amount owing by the Borrower under the Finance Documents
to a Finance Party (the
"recovering Finance Party") is discharged by payment, set-off or
any other manner other than
through the Facility Agent in accordance with Clause 11
(Payments) (a "recovery"), then:-
(a) the recovering Finance Party shall, within three Business
Days, notify details of the
recovery to the Facility Agent;
(b) the Facility Agent shall determine whether the recovery
is in excess of the amount
which the recovering
