AGREEMENT
DATED 9th June, 1999
U.S.$530,000,000
TERM AND REVOLVING CREDIT FACILITY
FOR
MEGGITT PLC
ARRANGED BY
BARCLAYS CAPITAL
HSBC INVESTMENT BANK plc
XXXXX & XXXXX
London
INDEX
Clause Page
1. Interpretation..................................................1
2. The Facilities.................................................16
3. Purpose........................................................17
4. Conditions Precedent...........................................18
5. Advances.......................................................19
6. Bills..........................................................21
7. Bills Procedure................................................22
8. Repayment......................................................24
9. Prepayment and Cancellation....................................25
10. Interest.......................................................27
11. Optional Currencies............................................30
12. Payments.......................................................31
13. Taxes..........................................................32
14. Market Disruption..............................................35
15. Increased Costs................................................36
16. Illegality and Mitigation......................................38
17. Guarantee......................................................38
18. Representations and Warranties.................................42
19. Undertakings...................................................46
20. Default........................................................52
21. The Agent and the Arrangers....................................56
22. Fees...........................................................60
23. Expenses.......................................................61
24. Stamp Duties...................................................62
25. Indemnities....................................................62
26. Evidence and Calculations......................................63
27. Amendments and Waivers.........................................63
28. Changes to the Parties.........................................64
29. Disclosure of Information......................................67
30. Set-Off........................................................68
31. Pro Rata Sharing...............................................68
32. Severability...................................................69
33. Counterparts...................................................69
34. Notices........................................................69
35. Language.......................................................70
36. Jurisdiction...................................................70
37. Governing Law..................................................71
Schedule Page
1. Banks and Commitments...........................................73
2. Conditions Precedent............................................74
Part I - Conditions Precedent...................................74
Part II - To be delivered before Merger Completion Advances.....76
Part III - To be delivered by an Additional Borrower............77
Part IV - To be delivered by an Additional Guarantor............78
3. Calculation of the MLA Cost.....................................80
4. Form of Request.................................................82
5. Form of Xxxx....................................................83
6. Forms of Accession Documents....................................84
Part I - Novation Certificate...................................84
Part II - Borrower Accession Agreement..........................86
Part III - Guarantor Accession Agreement........................87
7. Timetables......................................................88
Signatories.........................................................91
* Delete as appropriate.
** Complete only if the Request is for Tranche B Advances and the requested Term
is of an optional duration.
THIS AGREEMENT is dated 9th June, 1999 between:
(1) MEGGITT plc (Registered No. 432989 (the "Company");
(2) THE SUBSIDIARIES OF THE COMPANY listed in Part I of Schedule 1 as
original guarantors (the "Original Guarantors");
(3) BARCLAYS CAPITAL and HSBC INVESTMENT BANK plc as arrangers (in this
capacity the "Arrangers");
(4) THE FINANCIAL INSTITUTIONS listed in Part II of Schedule 1 as banks;
and
(5) HSBC INVESTMENT BANK plc as agent (in this capacity the "Agent").
IT IS AGREED as follows:
1. INTERPRETATION
1.1 Definitions
In this Agreement:
"Acceptance Commission Rate"
means 0.65 per cent. per annum.
"Additional Borrower"
means a member of the Group which becomes a Borrower in accordance with
Clause 28.4 (Additional Borrowers).
"Additional Guarantors"
means a member of the Group which becomes a Guarantor in accordance
with Clause 28.5 (Additional Guarantors).
"Advance"
means a Tranche A Advance, a Tranche B Advance or a Tranche C Advance.
"Affiliate"
means a Subsidiary or a holding company (as defined in Section 736
of the Companies Act 1985) of a person and any other Subsidiary of
that Holding Company.
"Agent's Spot Rate of Exchange"
means the spot rate of exchange as determined by the Agent for the
purchase of the relevant Optional Currency in the London foreign
exchange market with Dollars at the relevant time on a particular day.
"Banks"
means those banks listed in Part II of Schedule 1 and their respective
successors and assigns which are for the time being participating in
the Facilities.
2
"Bidco"
means the wholly owned subsidiary of the Company which makes the Offer.
"Xxxx"
means a Xxxxxxxx xxxx of exchange substantially in the form of
Schedule 5.
"Borrower"
means the Company (whether in its capacity as a borrower or guarantor
as the context may require) and each Additional Borrower.
"Borrower Accession Agreement"
means a letter substantially in the form of Part II of Schedule 6
with such amendments as the Agent may approve or reasonably require.
"Borrowings"
means, in relation to any person, at any time, any indebtedness in
respect of:
(a) the principal amount of moneys borrowed and any net debit
balances at banks after application of applicable account
pooling arrangements;
(b) the principal amount of any debenture, bond, note, loan stock,
commercial paper or other securities;
(c) the principal amount raised under acceptance credit facilities
other than acceptances relating to the purchase or sale of
goods in the ordinary course of trading;
(d) capital of any person to the extent treated as a borrowing by
the auditors of such person;
(e) counter-indemnity or similar obligations of that person in
respect of documentary credits, guarantees or similar
instruments issued by any person to support the Borrowings of
any person;
(f) any negotiable instrument, whether as drawer, issuer,
acceptor, endorser or otherwise, but excluding liabilities on
negotiable instruments discounted in the ordinary course of
trading;
(g) receivables sold or discounted other than receivables sold or
discounted in the ordinary course of trading;
(h) the acquisition cost of any asset to the extent payable before
or after the time of acquisition or possession by the party
liable where the advance or deferred payment was arranged
primarily as a method of raising finance or financing the
acquisition of that asset;
(i) the capitalised element of any rental payments under finance
leases (whether in respect of land, machinery, equipment or
otherwise) entered into primarily as a method of raising
finance or financing the acquisition of the asset leased;
3
(j) (for the purposes of Clause 20.5 (Cross default) only) the net
settlement amount of any liability under any swap, hedging or
similar treasury instrument, as determined in accordance with
the document evidencing that liability;
(k) principal amounts raised under any other transaction having
the commercial effect of a borrowing or the raising of money;
or
(l) any guarantee, indemnity or similar assurance given to support
any of the indebtedness of a type specified in this definition
of any person,
but no particular indebtedness shall be taken into account more than
once (so that for example, a guarantee shall be excluded to the extent
that the indebtedness guaranteed thereby is already taken into
account).
"Business Day"
means a day (other than a Saturday or Sunday) on which banks and the
interbank and foreign exchange markets are open for business in:
(a) London and, if a payment is required in Dollars, New York; and
(b) (in respect of a day on which a payment in an Optional
Currency except euros is required hereunder) the principal
financial centre of the country of such Optional Currency,
and, in relation to a payment or rate fixing in or other matter
relating to euros, a day on which the Trans-European Automated
Real-Time Gross Settlement Express Transfer System (TARGET) is
operating.
"Code"
means the United States Internal Revenue Code of 1986, as amended and
any rule or regulation issued thereunder from time to time in effect.
"Commitment"
means, in respect of a Bank, the aggregate of its Tranche A Commitment,
Tranche B Commitment and Tranche C Commitment in each case to the
extent not cancelled or reduced under this Agreement.
"Control Event"
has the meaning given to it in Clause 9.5 (Mandatory Prepayment on
change of control).
"Controlled Group"
means all members of a controlled group of corporations and all trades
or businesses (whether or not incorporated) under common control which,
together with any Obligor, are treated as a single employer under
Section 414 (b) or (c) of the Code.
4
"CULS"
means the interest bearing guaranteed redeemable convertible unsecured
loan stock of Meggitt Funding Limited, constituted by a deed poll dated
on or about the date of this Agreement made by Meggitt Funding Limited
and the Company.
"Dangerous Substance"
means any radioactive emissions and any natural or artificial substance
(in whatever form) the generation, transportation, storage, treatment,
use or disposal of which (whether alone or in combination with any
other substance) gives rise to a risk of causing harm to man or any
other living organism or damaging the Environment or public health or
welfare, including (without limitation) any controlled, special,
hazardous, toxic, radioactive or dangerous waste.
"Default"
means an Event of Default or an event which, with the giving of notice
or expiry of any grace period specified in Clause 20 (Default) (or any
combination of the foregoing), would constitute an Event of Default.
"Dollars" or "U.S.$"
means the lawful currency of the United States of America.
"EBDR"
means, in relation to any Bills, the arithmetic mean (rounded upwards,
if necessary, to the nearest 1/64) of the respective rates notified to
the Agent by each of the Reference Banks quoting (provided that at
least two Reference Banks are quoting) as the rate at which Eligible
Bills of an equivalent aggregate face amount and tenor to those Bills
can be discounted in the London discount market by that Reference Bank
at or about 11.00 a.m. on the relevant Utilisation Date.
"Eligible Xxxx"
means a Xxxxxxxx xxxx of exchange eligible for rediscounting at the
Bank of England.
"EMU"
means Economic and Monetary Union as contemplated in the Treaty on
European Union.
"EMU Legislation"
means legislative measures of the European Union for the introduction
of changeover to or operation of the euro in one or more member states.
"Environment"
means all, or any of, the following media, the air (including the air
within buildings and the air within other natural or man-made
structures above or below ground), water (including, without
limitation, ground and surface water) and land (including, without
limitation, surface and sub-surface soil).
5
"Environmental Claim"
means any claim by any person:
(a) in respect of any loss or liability suffered or incurred by
that person as a result of or in connection with any violation
of Environmental Law; or
(b) that arises as a result of or in connection with Environmental
Contamination and that could give rise to any remedy or
penalty (whether interim or final) that may be enforced or
assessed by private or public legal action or administrative
order or proceedings.
"Environmental Contamination"
means each of the following and their consequences:
(a) any release, discharge, emission, leakage or spillage of any
Dangerous Substance at or from any site owned, occupied or
used by any member of the Group into any part of the
Environment; or
(b) any accident, fire, explosion or sudden event at any site
owned, occupied or used by any member of the Group which is
directly or indirectly caused by or attributable to any
Dangerous Substance; or
(c) any other pollution of the Environment.
"Environmental Law"
means all laws, regulations, codes of practice, circulars, guidance
notices and the like having legal effect concerning the protection of
human health, the Environment, the conditions of the work place or the
generation, transportation, storage, treatment or disposal of Dangerous
Substances.
"Environmental Licence"
means any permit, licence, authorisation, consent or other approval
required by any Environmental Law.
"euro" or "euros"
means the single currency of the European Union as constituted by the
Treaty on European Union and as referred to in the EMU Legislation.
"ERISA"
means the U.S. Employee Retirement Income Security Act of 1974, as
amended, and any rule or regulation issued thereunder from time to
time.
"Event of Default"
means an event specified as such in Clause 20.1 (Events of Default).
6
"Facility"
means any of the facilities designated as Tranche A, Tranche B or
Tranche C in Clause 2.1 (Facilities).
"Facility Office"
means, subject to Clause 28.2 (Transfers and change of Facility Office
by Banks), the office(s) 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(s) through which it will perform all or any of its
obligations under this Agreement.
"Fee Letters"
means:
(a) the letter dated on or about the date of this Agreement
between the Agent and the Company; and
(b) the letter dated 24th May, 1999 between the Arrangers and the
Company,
in each case setting out the amount of various fees referred to in
Clause 22 (Fees).
"Final Maturity Date"
means the date five years after the date of this Agreement.
"Finance Document"
means this Agreement, each Fee Letter, a Xxxx, a Novation Certificate,
a Borrower Accession Agreement, a Guarantor Accession Agreement or any
other document designated as such by the Agent and the Company.
"Finance Party"
means an Arranger, a Bank or the Agent.
"Group"
means the Company and its Subsidiaries.
"Guarantors"
means the Company, each Original Guarantor and each Additional
Guarantor.
"Hedging Strategy"
means a hedging strategy for the Group on the terms set out in a letter
dated 1st June, 1999 from the Company to the Agent and countersigned by
the Agent on behalf of the Arrangers, as amended from time to time with
the prior written consent of the Majority Banks.
7
"Interest Period"
in respect of a Tranche A Advance or a Term-out Advance, has the
meaning given to it in Clause 10.1 (Selection of Interest Periods for
Tranche A Advances and Term-out Advances) or, in respect of overdue
amounts, Clause 10.4 (Default Interest).
"LIBOR"
in relation to any Advance or unpaid sum, means the rate determined by
the Agent to be either:
(i) the percentage rate per annum of the offered quotations in the
required currency and for the required period which appear on
the page of the Xxxxxx Money Rates Service Screen which
displays an average British Bankers Association Interest
Settlement Rate (being currently "LIBOR01" and subsequent
pages) (or such other page or service as may replace such
page(s)) for the purpose of displaying an average British
Bankers Association Interest Settlement Rate for such currency
as the Agent, after consultation with the Company, shall
select) as at 11.00 a.m. on the Rate Fixing Day for such
period; or
(ii) in the case of the Term or the first Interest Period of an
Offer Closing Advance or if in any case no such display rate
is then available, the arithmetic mean (rounded upwards, if
necessary, to the nearest four decimal places) of the
respective rates notified to the Agent by each of the
Reference Banks quoting (provided that at least two Reference
Banks are quoting) as the rate at which it is offered deposits
in the required currency and for the required period by prime
banks in the London interbank market at or about 11.00 a.m.
(or in the case of the Term or the first Interest Period of an
Offer Closing Advance, 1.00 p.m.) on the Rate Fixing Day for
such period,
and, for the purpose of this definition, "required currency" means, in
relation to such Advance or unpaid sum, the currency in which such
Advance or unpaid sum will be denominated during the required period
and "required period" means the applicable Interest Period for a
Tranche A Advance or a Term-out Advance, the Term of such Advance for
Tranche B Advances or Tranche C Advances (except Term-out Advances) or
the period in respect of which LIBOR falls to be determined in relation
to such unpaid sum.
"Majority Banks"
means, at any time:
(a) if any Advances are outstanding, Banks with an aggregate
Original Dollar Amount of Advances at that time of more than
66 2/3 per cent. of the aggregate Original Dollar Amount of
all Advances then outstanding; or
(b) if no Advances are outstanding, Banks whose Commitments then
aggregate more than 66 2/3 per cent. of the Total Commitments
(or if the Total Commitments have been reduced to zero,
aggregated more than 66 2/3 per cent. of the Total Commitments
immediately before the reduction).
"Mandatory Cost"
means:
8
(a) the cost of compliance with the cash ratio deposit
requirements of the Bank of England and the amount of fees
payable to the Financial Services Authority during its term or
Interest Period, determined in accordance with Schedule 3; and
(b) any other applicable regulatory or central bank requirement
relating to any utilisation made through a branch in the
jurisdiction of the currency concerned.
"Margin"
means:
(a) 0.65 per cent. per annum in respect of a Term A Advance or a
Tranche B Advance; or
(b) 0.40 per cent. per annum in respect of a Tranche C Advance.
"Maturity Date"
means the last day of the Term of an Advance under either Tranche B or
Tranche C or a Xxxx under Tranche B.
"Merger"
means the merger between Bidco and the Target on the terms set out in
the Merger Agreement.
"Merger Agreement"
means the Agreement and Plan of Merger dated on or about the date of
this Agreement between Bidco, the Target and the Company as the same
may be amended or varied from time to time (with the consent of the
Majority Banks, if required, under this Agreement).
"Multiemployer Plan"
means a "multiemployer plan" as defined in Section 4001(a)(3) of ERISA
to which any Obligor or any member of the Controlled Group has an
obligation to contribute.
"Novation Certificate"
has the meaning given to it in Clause 28.3 (Procedure for novations).
"Obligor"
means each Borrower and each Guarantor.
"Offer"
means the tender offer for the Shares made or to be made by Bidco on
the terms and conditions referred to in the Merger Agreement and set
out in the Offer Documents.
"Offer Closing Advance"
means any Advances utilised in Dollars within 3 Business Days of the
Unconditional Date for the purpose of financing the acquisition of
those Shares to be acquired by Bidco pursuant to the Offer, where the
Request for such Advance is delivered to the Agent after 3 p.m. on the
third Business Day before the Utilisation Date of such Advances.
9
"Offer Documents"
means the Statement on Schedule 14D-1, and the exhibits thereto, to be
filed with the U.S. Securities and Exchange Commission with respect to
the Offer.
"Optional Currency"
means, in relation to any Advance or proposed Advance, Sterling, euros,
Swiss Francs or any other currency (other than Dollars) approved in
writing by the Banks which is readily available and freely transferable
in the London foreign exchange market in sufficient amounts to fund
that Advance.
"Original Dollar Amount"
means:
(a) the principal amount of an Advance denominated in Dollars; or
(b) the principal amount of an Advance denominated in an Optional
Currency or a Xxxx, translated into Dollars on the basis of
the Agent's Spot Rate of Exchange on the date of receipt by
the Agent of the Request for that Advance.
"Original Group Accounts"
means the audited consolidated accounts of the Group for the year ended
31st December, 1998.
"Party"
means a party to this Agreement.
"PBGC"
means the Pension Benefit Guaranty Corporation referred to and defined
in ERISA, or any successor thereto.
"Permitted Security Interest"
means:
(a) any Security Interest created with the prior written consent
of the Majority Banks;
(b) any lien arising by operation of law (or by an agreement
evidencing the same) in the ordinary course of business of the
relevant member of the Group;
(c) any Security Interest arising out of title retention
provisions in a supplier's standard conditions of supply of
goods acquired by the relevant member of the Group in the
ordinary course of its business;
(d) any Security Interest existing at the date hereof and
disclosed in writing to the Agent by the Company prior to the
date hereof provided the principal amount secured thereby, as
so disclosed, is not exceeded;
(e) any Security Interest over the assets of any company which
becomes a Subsidiary of the Company after the date hereof,
provided that:
10
(i) such Security Interest is in existence prior to the
date that it becomes a Subsidiary and is created
otherwise than in contemplation of becoming a
Subsidiary;
(ii) the principal amount secured thereby immediately
prior to it becomes a Subsidiary of the Company is
not thereafter exceeded; and
(iii) unless otherwise agreed by the Majority Banks, the
Company will use all reasonable endeavours to
discharge or procure the discharge of such Security
Interest as soon as reasonably practicable after it
becomes a member of the Group;
(f) any Security Interest over any assets (or documents of title
thereto) which are acquired by the Company or any Subsidiary
of the Company subject to such Security Interest, provided
that:
(i) the principal amount secured thereby immediately
prior to such asset being acquired is not thereafter
exceeded; and
(ii) unless otherwise agreed by the Majority Banks, the
Company will use all reasonable endeavours to
discharge or procure the discharge of such Security
Interest as soon as reasonably practicable after such
acquisition; and
(g) any other Security Interest over any asset of the Company or
any Subsidiary of the Company so long as the lower of the
aggregate amount of the indebtedness secured by such Security
Interest and the book value of the asset subject to the
indebtedness does not exceed when aggregated with, as
relevant, the aggregate amount of the indebtedness secured by
or the book value of any other assets the subject of Security
Interests permitted under this paragraph (g), 'L'20,000,000
or its equivalent in other currencies.
"Plan"
means an "employee benefit plan" as defined in section 3(3) of ERISA
which is maintained, or to which there is an obligation to pay or
contribute, by any Obligor or any member of the Controlled Group.
"Prescribed Time"
means the time set opposite the number of a sub-Clause or paragraph
of Clauses 5 (Advances) and 6 (Bills) under the heading "Time" in
Schedule 7.
"Press Release"
means the press release referred to in Part II of Schedule 2 to be made
by or on behalf of Bidco on or about the date of this Agreement
announcing an intention to make the Offer.
"Principal Subsidiary"
means:
(a) any Additional Borrower;
11
(b) any Guarantor (other than the Company); and
(c) any other Subsidiary of the Company:
(i) whose profits (before interest, taxation and before
exceptional and extraordinary items and any taxation
relating thereto) are 10 per cent. or more of the
consolidated net profits of the Group (before
interest, taxation and before exceptional and
extraordinary items and any taxation relating
thereto); or
(ii) whose gross assets are 10 per cent. or more of the
consolidated gross assets of the Group,
all as shown (in the case of any Subsidiary) in its most recent annual
accounts and (in the case of the Group) in the most recent annual
consolidated accounts of the Group after, for this purpose, deducting
from each set of figures amounts attributable to minorities.
"Qualifying Bank"
means a bank or financial institution which is:
(a) a bank as defined in Section 840A of the Income and
Corporation Taxes Act 1988 which is within the charge to
corporation tax as regards any interest received by it under
this Agreement and which is beneficially entitled to that
interest; or
(b) 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 under which that
institution is entitled to exemption from United Kingdom tax
on interest and is entitled to apply under the Double Taxation
Relief (Taxes on Income) (General) Regulations 1970 to have
interest paid to its Facility Office without withholding or
deduction for or on account of United Kingdom taxation (and
does not carry on business in the United Kingdom through a
permanent establishment with which the investments under this
Agreement in respect of which the interest is paid is
effectively connected) and for this purpose "double taxation
treaty" means any convention or agreement 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.
"Rate Fixing Day"
means:
(a) the Utilisation Date for a Xxxx or an Advance denominated in
Sterling (or, in the case of a Tranche A Advance or Term-out
Advance denominated in Sterling, the first day of each
applicable Interest Period); or
(b) (subject to paragraph (c) below) the second Business Day
before the Utilisation Date for an Advance denominated in a
currency other than Sterling (or, in the case of a Tranche A
Advance or Term-out Advance denominated in a currency other
than Sterling, the first day of each applicable Interest
Period) or
(c) in the case of the Term or the first Interest Period of an
Offer Closing Advance, the Business Day before the Utilisation
Date of such Offer Closing Advance.
12
"Reference Banks"
means, subject to Clause 28.6 (Reference Banks), the principal London
offices of Barclays Bank PLC and Midland Bank plc.
"Reportable Event"
means a reported event as defined in Section 4043 of ERISA and the
regulations issued under such section with respect of a Plan,
excluding, however, such events as to which the PBGC by regulation
waived the requirement of Section 4043(a) of ERISA that it be notified
within 30 days of the occurrence of such event, provided, however, that
a failure to meet the minimum funding standard of Section 412 of the
Code and of Section 302 of ERISA shall be a Reportable Event regardless
of the issuance of any such waiver of the notice requirement in
accordance with either Section 4043(a) of ERISA or Section 412(d) of
the Code.
"Request"
means a request made by a Borrower to utilise a Facility, substantially
in the form of Schedule 4.
"Requested Amount"
means the amount requested in a Request.
"Restricted Transaction"
means any transaction which is a Class 1 transaction as defined in
Chapter 10 of the Listing Rules of the London Stock Exchange as at 11th
January, 1999.
"Security Interest"
means any mortgage, charge, pledge, lien or other security interest
securing any obligation of any person or any other security interest
having a similar effect.
"Shares"
means all the Target's outstanding common stock and Series D
Participating Convertible Preferred Stock.
"Single Employer Plan"
means a "single employer plan" as defined in Section 4001(a)(15) of
ERISA which is maintained by any Obligor or any member of the
Controlled Group for employees of the Company or any member of the
Controlled Group.
"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) for the purposes of Clauses 19.2 and 19.16 only, a subsidiary
undertaking within the meaning of Section 258 of the Companies
Xxx 0000 (as inserted by Section 21 of the Companies Act
1989).
13
"Syndication Period"
means the period ending on the date the Arrangers notify the Company
that general syndication of the Facilities is completed.
"Target"
means Xxxxxxxxx Corporation (incorporated in Delaware with Federal
Employer Number 00-0000000).
"Term"
means the period selected by a Borrower in a Request for which the
relevant Tranche B Advance, Tranche C Advance or Xxxx is to be
outstanding.
"Term-out Advances" means the Tranche C Advances, if any, drawn under
Clause 8.3(b) (Repayment of Tranche C Advances).
"Total Commitments"
means the aggregate of the Tranche A Total Commitments, Tranche B Total
Commitments and Tranche C Total Commitments from time to time.
"Tranche A Advance"
means a cash advance made by a Bank under Tranche A.
"Tranche A Commitment"
means, in respect of a Bank, the amount in Dollars set opposite the
name of that Bank in Column 1 of Part II of Schedule 1 to the extent
not cancelled or reduced under this Agreement.
"Tranche A Commitment Period"
means the period from and including the date of this Agreement to and
including the date 180 days after the date of this Agreement or, if
earlier, the date on which the Offer lapses, terminates or is
withdrawn.
"Tranche A Total Commitments"
means the aggregate for the time being of the Tranche A Commitments,
being U.S.$250,000,000 at the date of this Agreement.
"Tranche B Advance"
means a cash advance made by a Bank under Tranche B.
"Tranche B Commitment"
means, in respect of a Bank, the amount in Dollars set opposite the
name of that Bank in Column 2 of Part II of Schedule 1 to the extent
not cancelled or reduced under this Agreement.
14
"Tranche B Total Commitments"
means the aggregate for the time being of the Tranche B Commitments,
being U.S.$180,000,000 at the date of this Agreement.
"Tranche C Advance"
means a cash advance made by a Bank under Tranche C.
"Tranche C Availability Period"
means the period from and including the date of this Agreement up to
and including the date which is 364 days after the date of this
Agreement.
"Tranche C Commitment"
means, in respect of a Bank, the amount in Dollars set opposite the
name of that Bank in Column 3 of Part II of Schedule 1 to the extent
not cancelled or reduced under this Agreement.
"Tranche C Term Date"
means the last day of the Tranche C Availability Period or, if that day
is not a Business Day, the preceding Business Day.
"Tranche C Term-out Option"
means the option available to the Borrowers to draw Term-out Advances
under Tranche C pursuant to Clause 8.3(b) (Repayment of Tranche C
Advances).
"Tranche C Total Commitments"
means the aggregate for the time being of the Tranche C Commitments,
being U.S.$100,000,000 at the date of this Agreement.
"Transaction Documents"
means the Finance Documents, the Offer Documents and the Merger
Agreement.
"UK" or "United Kingdom"
means the United Kingdom of Great Britain and Northern Ireland.
"Unconditional Date"
means the date on which the Offer expires (being either its scheduled
expiration date or any extended expiration date) and on which there
have been validly tendered in accordance with the terms of the Offer
and not withdrawn, a number of shares of the common stock of the Target
that, together with the shares then beneficially owned by the Company,
represent at least a majority of the shares of the common stock of the
Target on a fully diluted basis.
"United States"
means the United States of America.
15
"U.S. Borrower"
means a Borrower which is incorporated in the United States.
"Utilisation"
means:
(a) in the case of a Utilisation comprising Advances, all the
Advances made or to be made; or
(b) in the case of a Utilisation comprising Bills, all the Bills
accepted or to be accepted,
following the giving by a Borrower of a Request for those Advances
or Bills.
"Utilisation Date"
means:
(a) in the case of an Advance, the date for the making of the
relevant Advance; and
(b) in the case of a Xxxx, the date for the acceptance of the
relevant Xxxx.
1.2 Construction
(a) In this Agreement, unless the contrary intention appears, a reference
to:
(i) "assets" includes properties, revenues and rights of every
description;
an "authorisation" includes an authorisation, consent,
approval, resolution, licence, exemption, filing, registration
and notarisation;
"Barclays Capital" is a reference to Barclays Capital, the
investment banking division of Barclays Bank PLC (and all such
references shall include Barclays Bank PLC);
"material adverse effect" means anything which is likely to
have a material adverse effect on the financial condition of
the Group taken as a whole such that the Company is likely to
be unable to comply with its payment obligations under the
Finance Documents;
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 Business Day in
that calendar month;
a "principal amount" in relation to a Xxxx is a reference to
the face amount of that Xxxx;
a "regulation" includes any regulation, rule, official
directive, request or guideline (whether or not having the
force of law but if not, being something which persons are
accustomed to comply with) of any governmental body, agency,
department or regulatory, self-regulatory or other authority
or organisation;
16
(ii) a provision of a 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 permitted assigns;
(v) a Finance Document or another document is a reference to that
Finance Document or that 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.
2. THE FACILITIES
2.1 Facilities
The Xxxxx xxxxx to the Borrowers the following facilities:
(a) a committed multicurrency term loan facility, to be designated
as Tranche A, under which the Banks will, when requested by a
Borrower, make Advances to that Borrower;
(b) a committed multicurrency revolving credit facility, to be
designated as Tranche B, comprising:
(i) a multicurrency advance facility under which the
Banks will, when requested by a Borrower, make
Advances to that Borrower on a revolving basis; and
(ii) a Sterling bankers' acceptance facility under which
the Banks will, when requested by a Borrower, accept
Bills drawn by that Borrower on a revolving basis;
and
(c) a committed multicurrency revolving 364 day credit facility,
with an option to draw Term-out Advances, to be designated as
Tranche C, under which the Banks will, when requested by a
Borrower, make Advances to that Borrower,
in all cases subject to the terms of this Agreement.
2.2 Overall facility limit
(a) The aggregate Original Dollar Amount of all outstanding Utilisations:
(i) under Tranche A, shall not at any time exceed the Tranche A
Total Commitments at that time;
17
(ii) under Tranche B, shall not at any time exceed the Tranche B
Total Commitments at that time; and
(iii) under Tranche C, shall not at any time exceed the Tranche C
Total Commitments at that time.
(b) The aggregate Original Dollar Amount of:
(i) Tranche A Advances made by a Bank shall not at any time exceed
its Tranche A Commitment at that time;
(ii) Tranche B Advances made by a Bank and Bills accepted by that
Bank shall not at any time exceed its Tranche B Commitment at
that time; and
(iii) Tranche C Advances made by a Bank shall not at any time exceed
its Tranche C Commitment at that time.
2.3 Number of Requests and Utilisations
(a) No more than one Request may be delivered on any one day but, subject
to paragraphs (b) and (c) below, that Request may specify any number
and type of Utilisations from either Tranche A or Tranche B or Tranche
C or all of them.
(b) No more than 10 Utilisations may be outstanding at any time.
(c) No more than 5 currencies may be utilised under the Facilities at any
time.
2.4 Syndication Period
Notwithstanding any other provision of this Agreement no Borrower will
deliver a Request or interest period selection notice during the
Syndication Period, specifying a Term or an Interest Period which would
exceed one month.
2.5 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.
3. PURPOSE
(a) Each Utilisation will be applied:
(i) in the case of Tranche A in or towards:
(1) financing the acquisition of those of the Shares
to be acquired by Bidco pursuant to the Offer;
18
(2) financing the consideration payable by Bidco upon
completion of the Merger in accordance with the
Merger Agreement; or
(3) financing fees and expenses of the Group in relation
to the Offer and the Merger;
(ii) in the case of Tranche B:
(1) the purposes specified in paragraph (a)(i) above;
(2) in or towards refinancing existing indebtedness of
the Group including the Target or Subsidiaries of the
Target once the Target becomes a member of the Group;
or
(3) for general long term corporate purposes of the
Group; and
(iii) in the case of Tranche C:
(1) in or towards refinancing existing indebtedness of
the Group; or
(2) for general short term corporate purposes of the
Group.
(b) Without affecting the obligations of any Borrower in any way, no
Finance Party is bound to monitor or verify the application of the
proceeds of any Utilisation.
4. CONDITIONS PRECEDENT
4.1 Documentary conditions precedent
The obligations of each Bank to participate in the first Utilisation
are subject to the condition precedent that the Agent has notified the
Company and the Banks that it has received all of the documents set out
in Part I of Schedule 2 in form and substance satisfactory to the Agent
(acting reasonably). The Agent will promptly notify the Company upon
such receipt.
4.2 Further specific conditions precedent
(a) The obligations of each Bank to participate in the first Utilisation
are also subject to the conditions precedent that the Agent has
received evidence in form and substance satisfactory to it (acting
reasonably) that:
(i) the Company has received (or will receive simultaneously with
the first Utilisation) net proceeds of not less than
'L'70,000,000 pursuant to subscriptions for CULS; and
(ii) such proceeds have been applied in full by the Company in or
towards the purposes specified in Clause 3(a)(i)(1) (or will
be so applied simultaneously with the disbursement of the
first Utilisation).
(b) The obligations of each Finance Party to any Borrower to participate in
any Utilisation the purpose of which is to finance payments due by
Bidco upon completion of the Merger are subject to the further
conditions precedent specified in Part II of Schedule 2.
19
4.3 Further general conditions precedent
The obligations of each Bank to participate in any Utilisation are
subject to the further conditions precedent that:
(a) the representations and warranties in Clause 18
(Representations and Warranties) to be repeated on those dates
are correct and will be correct immediately after the
Utilisation;
(b) in the case of Tranche A, no Default or Control Event is
outstanding or would result from the Utilisation;
(c) in the case of Tranche B or Tranche C, no Event of Default is
outstanding or would result from the Utilisation;
(d) in the case of Tranche B or Tranche C, if, immediately
following the making of the relevant Utilisation, the amount
of either Tranche B Total Commitments or Tranche C Total
Commitments drawn by the Borrowers will have been increased,
no Default or Control Event is outstanding or would result
from the Utilisation; and
(e) the Utilisation would not cause Clause 2.2 (Overall facility
limit) to be contravened.
5. ADVANCES
5.1 Receipt of Requests
A Borrower may borrow Advances under Tranche A, Tranche B or Tranche C
if the Agent receives, not later than the Prescribed Time, a duly
completed Request.
5.2 Completion of Requests for Tranche A Advances
A Request for Tranche A Advances will not be regarded as having been
duly completed unless:
(a) the Utilisation Date is a Business Day during the Tranche A
Commitment Period;
(b) only one currency is specified for each separate Advance and
the Requested Amount for each separate Advance is:
(i) if the currency is Dollars, a minimum of U.S.
$25,000,000 and an integral multiple of
U.S.$5,000,000;
(ii) if the currency is an Optional Currency, such
comparable and convenient minimum and integral
multiples as are agreed between the Company and the
Agent before delivery of that Request; or
(iii) such other amount as the Company and the Agent may
agree;
(c) only one Interest Period for each separate Tranche A Advance
is specified which is a period of one month, two, three or six
months (or, in any case, such other period as all the Banks
may previously have agreed for the purposes of such
Utilisation); and
(d) the payment instructions comply with Clause 12.1 (Place of
Payment).
20
5.3 Completion of Requests for Tranche B Advances
A Request for Tranche B Advances will not be regarded as having been
duly completed unless:
(a) the Utilisation Date is a Business Day;
(b) only one currency is specified for each separate Utilisation
and the Requested Amount for each separate Utilisation is:
(i) if the currency is Dollars, a minimum of
U.S.$15,000,000 and an integral multiple of
U.S.$5,000,000; or
(ii) if the currency is an Optional Currency, such
comparable and convenient minimum and integral
multiples as are agreed between the Company and the
Agent before delivery of that Request; or
(iii) such other amount as the Agent and the Company may
agree;
(c) only one Term for each separate Tranche B Advance is specified
which:
(i) does not overrun the Final Maturity Date; and
(ii) is a period of one week, one month, two, three or six
months (or such other period as all the Banks may
previously have agreed for the purposes of such
Utilisation); and
(d) the payment instructions comply with Clause 12.1 (Place of
Payment).
5.4 Completion of Requests for Tranche C Advance
A request for Tranche C Advances will not be regarded as having been
duly completed unless:
(a) the Utilisation Date is a Business Day during the Tranche C
Availability Period;
(b) only one currency is specified for each Utilisation and the
Requested Amount for each separate Utilisation is:
(i) if the currency is Dollars, a minimum of
U.S.$15,000,000 and an integral multiple of
U.S.$5,000,000; or
(ii) if the currency is an Optional Currency, such
comparable and convenient minimum and integral
multiples as are agreed between the Company and the
Agent before delivery of that Request; or
(iii) such other amount as the Agent and the Company may
agree;
(c) only one Term or, in the case of Term-out Advances, Interest
Period, for each separate Advance is specified which:
21
(i) does not overrun the Tranche C Term Date (other than
a Term-out Advance); and
(ii) is a period of one month, two, three or six months
(which, in the case of Term-out Advances only, does
not overrun the date six months after the Tranche C
Term Date (or, in any case, such other period as all
the Banks may previously have agreed for the purposes
of such Utilisation; and
(d) the payment instructions comply with Clause 12.1 (Place of
Payment).
5.5 Amount of each Bank's Advance
The amount of a Bank's Advance will be the proportion of the Requested
Amount which:
(a) in the case of a Tranche A Advance, its Tranche A Commitment
bears to Tranche A Total Commitments;
(b) in the case of a Tranche B Advance, its Tranche B Commitment
bears to the Tranche B Total Commitments; and
(c) in the case of a Tranche C Advance, its Tranche Commitment
bears to the Tranche C Total Commitments
in each case on the date of receipt of the relevant Request.
5.6 Notification of the Banks
The Agent shall, not later than the Prescribed Time, notify each Bank
of the details of the requested Advances and the amount of its Advance.
5.7 Payment of Proceeds
Subject to the terms of this Agreement, each Bank shall make its
Advance available to the Agent for the Borrower for value on the
relevant Utilisation Date.
6. BILLS
6.1 Receipt of Requests
A Borrower may request the acceptance of Bills under Tranche B by
delivery to the Agent, not later than the Prescribed Time, a duly
completed Request.
6.2 Form of Requests
A Request will not be regarded as being duly completed unless:
(a) the Utilisation Date is a Business Day;
(b) the Requested Amount is a minimum of 'L'15,000,000 and an
integral multiple of 'L'5,000,000 or such other amount as
the Agent and the Company may agree;
(c) only one Term is specified which:
22
(i) does not overrun the Final Maturity Date; and
(ii) is a period of not less than 14 days nor more than
187 days; and
(d) the payment instructions comply with Clause 12.1 (Place of
Payment).
6.3 Amount of Bills to be accepted by each Bank
The aggregate principal amount of the Bills to be accepted by a Bank
will be the proportion of the Requested Amount which its Tranche B
Commitment bears to the Tranche B Total Commitments on the date of
receipt of the relevant Request.
6.4 Notification of the Banks
The Agent shall, not later than the Prescribed Time, notify each Bank
of the details of the requested Bills and the aggregate principal
amount of the Bills to be accepted by it.
6.5 Advances as an alternative
(a) If any Bank is not willing to accept any Bills, then it may, not later
than the Prescribed Time, notify the Agent accordingly and the Agent
shall promptly thereafter notify the Company.
(b) If a Bank notifies the Agent in accordance with paragraph (a) above,
then, subject to the terms of this Agreement, the Bank shall instead
make a Tranche B Advance in accordance with Clause 5 (Advances) in
Sterling on the relevant Utilisation Date in a principal amount equal
to the aggregate principal amount of the Bills which it would otherwise
have been obliged to accept pursuant to this Clause 6 (Bills) and for a
Term equal to the Term of those Bills.
6.6 Acceptance of Bills
(a) The Agent shall, not later than the Prescribed Time, deliver Bills to
each Bank which is to accept Bills completed in accordance with Clause
7.1 (Holding and completion of Bills).
(b) Each Bank shall accept the Bills so delivered to it.
(c) The Agent shall, not later than the Prescribed Time, notify the
Borrower and each Bank of the applicable EBDR.
(d) Subject to the terms of this Agreement, each Bank shall pay to the
Agent for the Borrower an amount equal to:
(i) the amount which the Bank would have received as the proceeds
of discounting if it had discounted the Bills accepted by it
at the applicable EBDR; less
(ii) acceptance commission calculated at the Acceptance Commission
Rate on the aggregate principal amount of those Bills.
7. BILLS PROCEDURE
7.1 Holding and completion of Bills
(a) Subject to sub-clause 7.1(c) below, the Borrower shall ensure that the
Agent receives, by no later than the Prescribed Time, Bills which
shall:
23
(i) be drawn by the Borrower in its own favour and endorsed by it
in blank;
(ii) be undated;
(iii) have the Maturity Date, the drawee and the face amount left
blank; and
(iv) be claused as specified in the Request (which must be in a
manner which complies with the Bank of England's requirements
for Eligible Bills at that time).
(b) Subject to the terms of this Agreement, the Agent shall:
(i) date each Xxxx with its Utilisation Date;
(ii) insert in each Xxxx the name of the Bank on which it is drawn,
its face amount and its Maturity Date; and
(iii) deliver the requisite number of completed Bills to the Banks
for acceptance in accordance with this Agreement.
(c) Each Borrower hereby appoints the Agent as its attorney to draw,
endorse and deliver Bills complying with the requirements of sub-clause
7.1(a) and (b) on behalf of such Borrower to implement the relevant
drawing in satisfaction of that Borrower's obligations thereunder.
7.2 Rounding of principal amount of Bills
The Agent may round the principal amount of the relevant Bills to be
accepted by each Bank to ensure that each Xxxx has a principal amount
of not more than 'L'5,000,000.
7.3 Discounting of Bills
Each Bank may arrange for a Xxxx accepted by it to be discounted on its
behalf in the London discount market or elsewhere or discount the Xxxx
itself.
7.4 Information relating to Bills
Each Borrower shall, promptly on request by a Finance Party through the
Agent, supply to the Agent for that Finance Party any information
relating to any Xxxx (including the underlying trade transaction for
that Xxxx) as that Finance Party may reasonably require or which may be
required by the Bank of England or any other fiscal or monetary
authority in the U.K.
7.5 Eligible Bills
A Borrower shall ensure that each Xxxx drawn by it and accepted by a
Bank is, assuming that the relevant Bank is a bank whose acceptances
are then being treated as eligible acceptances by the Bank of England,
eligible for rediscounting at the Bank of England.
7.6 Indemnity
The Agent shall indemnify each Borrower and hold it harmless against
all or any proceedings, action, claims and demands which may be brought
or made against the Borrower and all losses, costs, charges, damages
and expenses ("Losses") the Borrower may incur or sustain or for which
the Borrower may become liable by reason of the completion by the Agent
of the
24
Bills otherwise than in accordance with instructions given under
the Request or by reason of the theft, loss, misappropriation or
conversion of the Bills whilst in the Agent's possession provided that
this indemnity shall only apply to the extent that such Losses arise
from the negligence or wilful misconduct of the Agent.
8. REPAYMENT
8.1 Repayment of Tranche A Advances
The Borrowers shall repay the Tranche A Advances in full by five
instalments. The instalments shall be paid on the dates set out in
Column (1) below and in the case of the first four instalments shall
have an Original Dollar Amount equal as nearly possible (rounded
upwards if necessary) to the amount set opposite the date of the
relevant instalment in Column (2) below. The fifth instalment shall be
paid on the Final Maturity Date and shall comprise all Tranche A
Advances which then remain outstanding.
(1) (2)
Repayment Date Original Dollar Amount of
Repayment Instalment
The first anniversary of the date of this U.S.$20,000,000
Agreement.
The second anniversary of the date of this U.S.$30,000,000
Agreement.
The third anniversary of the date of this U.S.$40,000,000
Agreement.
The fourth anniversary of the date of this U.S.$60,000,000
Agreement.
The Final Maturity Date. The balance of the Tranche A Advances then
outstanding.
8.2 Repayment of Tranche B Advances
Each Borrower shall repay each Tranche B Advance made to it in full on
its Maturity Date to the Agent for the relevant Bank but since Tranche
B is available on a revolving basis amounts repaid may be reborrowed or
redrawn subject to the terms of this Agreement. No Tranche B Advance
may be outstanding after the Final Maturity Date.
8.3 Repayment of Tranche C Advances
(a) Each Borrower shall repay each Tranche C Advance made to it in full on
its Maturity Date to the Agent for the relevant Bank but since Tranche
C is available on a revolving basis amounts repaid may be reborrowed
subject to the terms of this Agreement. Subject to paragraph (b) below,
no Tranche C Advance may be outstanding after the Tranche C Term Date.
(b) At any time and from time to time prior to the Tranche C Term Date, any
Borrower may, by delivery of a duly completed Request to the Agent
under Clause 5 (Advances) (who shall send a copy of the same to the
Banks), elect to draw one or more Advances (each a "Term-out Advance")
under Tranche C with a Maturity Date after the Tranche C Term Date.
25
No Term-out Advance, once repaid or prepaid, may be reborrowed (other
than under Clause 10.6) (Optional Currency).
(c) No Tranche C Advance, other than a Term-out Advance, may be outstanding
after the Tranche C Term Date. No Term-out Advance may be outstanding
after the date falling six months after the Tranche C Term Date.
8.4 Payment of Bills
Each Borrower shall pay an amount equal to the principal amount of each
Xxxx drawn by it on its Maturity Date to the Agent for the relevant
Bank but since Tranche B is available on a revolving basis amounts paid
may be redrawn or reborrowed subject to the terms of this Agreement. No
Xxxx may be outstanding after the Final Maturity Date.
9. PREPAYMENT AND CANCELLATION
9.1 Automatic Cancellation of the Tranche A Total Commitments
The Tranche A Commitment of each Bank shall be automatically cancelled
at close of business in London on the last day of the Tranche A
Commitment Period or, if earlier, when fully drawn.
9.2 Automatic Cancellation of the Tranche B Total Commitments
The Tranche B Commitment of each Bank shall be automatically cancelled
at the close of business in London on the Final Maturity Date.
9.3 Automatic Cancellation of the Tranche C Total Commitments
Without prejudice to the Term-Out Advances then outstanding, the
Tranche C Commitment of each Bank shall be automatically cancelled at
the close of business in London on the last day of the Tranche C Term
Date.
9.4 Voluntary Cancellation
The Company may, by giving not less than 5 Business Day's prior notice
to the Agent, cancel the unutilised portion of the Tranche A Total
Commitments, Tranche B Total Commitments and/or Tranche C Total
Commitments in whole or in part (but, if in part, in an aggregate
minimum amount of U.S.$25,000,000 and an integral multiple of
U.S.$5,000,000). Any cancellation shall be applied against Tranche A,
Tranche B and/or Tranche C in such proportions as the Company may
designate in the notice of cancellation. Any cancellation in part shall
be applied against the relevant Commitment of each Bank pro rata in
relation to the Tranche concerned.
9.5 Voluntary prepayment of Advances
(a) Any Borrower may, by giving not less than five Business Days' prior
notice to the Agent, prepay without premium or penalty (but subject to
payment of any amounts payable under Clause 25.2(c)) the whole or any
part of the Tranche A Advances or the Tranche B Advances or the Tranche
C Advances (but if in part in a minimum Original Dollar Amount of
U.S.$25,000,000 or, if more, integral multiples in an Original Dollar
Amount of U.S.$5,000,000).
26
(b) Any prepayment of Advances will:
(i) be applied pro rata to all the Tranche A Advances, Tranche B
Advances or, as the case may be, Tranche C Advances made by
the Banks; and
(ii) (in the case of a prepayment of Tranche A Advances) be applied
pro rata in reduction of the repayment instalments specified
in Clause 8.1(a) (Repayment of Tranche A Advances).
9.6 Mandatory prepayment on change of control
If at any time any single person or group of persons acting in concert
(as defined in the City Code on Takeovers and Mergers), acquires
control (as defined in Section 416 of the Income and Corporation Taxes
Act 1988) after the date of this Agreement of the Company (a "Control
Event") then the Agent shall, if instructed to do so by the Majority
Banks, by notice to the Company:
(a) call for prepayment of all Utilisations on a date which is the
earlier of (1) the date 30 days after the date on which the
Company notifies the Agent of the Control Event or (2) the
date which is 45 days after the day on which the Control Event
occurred (the "Prepayment Date") and the Borrowers shall on
the Prepayment Date (i) prepay all Advances in full together
with all other amounts payable by any of them under this
Agreement and (ii) immediately perform their obligations under
Clause 8.4 (Payment of Bills); and/or
(b) cancel the Total Commitments in full, with effect on the
Prepayment Date.
9.7 Mandatory Prepayment by Additional Borrowers
If any Additional Borrower ceases to be a Subsidiary of the Company it
shall forthwith prepay all Advances made to it together with all
amounts payable by it under this Agreement, immediately perform its
obligations under Clause 8.4 (Payment of Bills) and thereupon cease to
be a Borrower.
9.8 Removal of Borrowers
Any Additional Borrower in respect of which no Advance or Xxxx is
outstanding hereunder (including any other amounts outstanding in
relation thereto) may, at the request of the Company cease to be a
Borrower hereunder by entering into a supplemental agreement to this
Agreement in such form as the Agent may reasonably require which shall
discharge that Borrower's obligations hereunder.
9.9 Right of prepayment and cancellation
If any Borrower is required to pay or is notified by any Bank in
writing that it will be required to pay any amount to a Bank under
Clause 13 (Taxes) or Clause 15 (Increased Costs), or if circumstances
exist such that a Borrower will be required to pay any amount to a Bank
under Clause 13 (Taxes), the Company may, whilst the circumstances
giving rise or which will give rise to the requirement continue, serve
a notice of prepayment and cancellation on that Bank through the Agent.
On the date falling five Business Days after the date of service of the
Notice:
27
(a) each Borrower shall prepay any Advances made to it by that
Bank together with all other amounts payable by it to that
Bank under this Agreement;
(b) each Borrower shall immediately perform its obligations under
Clause 8.4 (Payment of Bills) in respect of all outstanding
Bills accepted by that Bank; and
(c) the Bank's Tranche A Commitment, Tranche B Commitment and
Tranche C Commitment shall be cancelled on the date of service
of the notice.
9.10 Miscellaneous provisions
(a) Any notice of prepayment and/or cancellation under this Agreement is
irrevocable. The Agent shall notify the Banks promptly of receipt of
any such notice.
(b) All prepayments under this Agreement shall be made together with
accrued interest on the amount prepaid and any other amounts due under
this Agreement in respect of that prepayment.
(c) No prepayment or cancellation is permitted except in accordance with
the express terms of this Agreement.
(d) No amount repaid under Clause 8.1 (Repayment of Tranche A Advances) or
prepaid under Clause 9.5 (Voluntary Prepayment of Advances) or Clause
9.9 (Right of prepayment and cancellation) may subsequently be
re-borrowed. Subject to the terms of this Agreement, any amount prepaid
in respect of Tranche B or Tranche C (other than Term-out Advances)
under Clause 9.7 (Mandatory Prepayment by Additional Borrowers) may be
reborrowed by other Borrowers. No amount of the Tranche A Total
Commitments, Tranche B Total Commitments or Tranche C Total Commitments
cancelled under this Agreement may subsequently be reinstated.
9.11 Discounted amount
If under this Agreement any Borrower is required, in relation to any
Xxxx, to comply with its obligations under Clause 8.4 (Payment of
Bills) before the Maturity Date of that Xxxx by reason of Clause 16.1
(Illegality), then the amount (the "Discounted Amount") payable by that
Borrower will be such amount (calculated by the Agent) as would be
necessary to ensure that the relevant Bank would receive, on the
Maturity Date of that Xxxx, the face amount of the Xxxx assuming that
the amount received were deposited on the Business Day of receipt of
that amount by 12 noon from (and including) that date up to (but
excluding) the original Maturity Date accruing interest at the rate at
which that Bank bids for Sterling deposits for that period from prime
banks in the London interbank market at or about 10.00 a.m. on the date
of receipt.
10. INTEREST
10.1 Selection of Interest Periods for Tranche A Advances and Term-out
Advances
The life of each Tranche A Advance or Term-out Advance will be divided
into successive periods (each an "Interest Period") for the calculation
of interest. The first Interest Period will be the period selected in
the Request for that Tranche A Advance or Term-out Advance (as
applicable) and each subsequent Interest Period will be the period
selected by the Borrower by notice to the Agent received not later than
the Prescribed Time (being one, two,
28
three or six months or in any case such other period as the Borrower
and all the Banks may agree from time to time) except that:
(a) if no such selection notice is received by the Prescribed Time
the Interest Period concerned will be three months; and
(b) Interest Periods in respect of Advances in an Original Dollar
Amount not less than the amount of each repayment instalment
specified in Clause 8.1 (Repayment of the Tranche A Advances)
must end on the date for the payment of each such repayment
instalment.
10.2 Interest rate for all Advances
The rate of interest on each Tranche A Advance or Term-out Advance for
each applicable Interest Period and each Tranche B Advance or Tranche C
Advance for its Term is the rate per annum determined by the Agent to
be the aggregate of:
(a) the Margin;
(b) LIBOR; and
(c) the Mandatory Cost.
10.3 Due dates
Except as otherwise provided in this Agreement, accrued interest on
each Advance is payable by the relevant Borrower:
(a) in the case of a Tranche A Advance or Term-out Advance, on the
last day of each Interest Period applicable to that Advance;
and
(b) in the case of a Tranche B Advance or a Tranche C Advance, on
its Maturity Date,
and also, in the case of any Advance with an Interest Period or a Term
longer than six months, at six monthly intervals after its Utilisation
Date for so long as the Interest Period or Term is outstanding.
10.4 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,
both before and after judgment, at a rate (the "default rate")
determined by the Agent to be one per cent per annum above the higher
of:
(i) the rate on the overdue amount under Clause 10.2 (Interest
rate for all Advances) immediately before the due date (if of
principal); and
(ii) the rate which would have been payable if the overdue amount
had, during the period of non-payment, constituted a Tranche B
Advance in the currency of the overdue amount for such
successive Interest Periods or Terms of such duration as the
Agent may determine (each a "Designated Term").
29
(b) The default rate will be determined on each Business Day or the first
day of, or two Business Days before the first day of, the relevant
Designated Term, as appropriate.
(c) If the Agent determines that deposits in the currency 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 selects after consultation with the
Reference Banks.
(d) Default interest will be compounded at the end of each Designated Term.
10.5 Change of currency
(a) If a Tranche A Advance or a Term-out Advance is to be continued during
its next Interest Period in a different currency (the "new currency")
from that in which it is currently denominated, the Tranche A Advance
or Term-out Advance shall be repaid by the relevant Borrower in full at
the end of its current Interest Period in the currency in which it is
then denominated and, subject to the terms of this Agreement, shall be
forthwith re-advanced by the Banks in the new currency.
(b) If the new currency is Dollars, the amount of each Bank's participation
in that Tranche A Advance or Term-out Advance will be its participation
in the Original Dollar Amount of that Tranche A Advance or Term-out
Advance for that Interest Period.
(c) If the new currency is an Optional Currency, the amount of each Bank's
participation in that Tranche A Advance or Term-out Advance will be
determined by converting into the new currency its participation in the
Original Dollar Amount of that Tranche A Advance or Term-out Advance on
the basis of the Agent's Spot Rate of Exchange three Business Days
before the commencement of that Interest Period.
10.6 Same Optional Currency
(a) If a Tranche A Advance or Term-out Advance is to be continued during
its next Interest Period in the same Optional Currency as that in which
it is denominated during its current Interest Period, there shall be
calculated the difference between the amount of the Tranche A Advance
or Term-out Advance (in that Optional Currency) for the current
Interest Period and for the next Interest Period. The amount of the
Tranche A Advance or Term-out Advance for the next Interest Period will
be determined by notionally converting into that Optional Currency the
Original Dollar Amount of the Tranche A Advance or Term-out Advance on
the basis of the Agent's Spot Rate of Exchange three Business Days
before the commencement of that Interest Period.
(b) At the end of the current Interest Period (but subject always to
paragraph (c) below):
(i) if the amount of the Tranche A Advance or Term-out Advance for
the next Interest Period is less than for the preceding
Interest Period, the relevant Borrower shall repay the
difference; or
(ii) if the amount of the Tranche A Advance or Term-out Advance for
the next Interest Period is greater, each Bank shall forthwith
make available to the Agent for the relevant Borrower its
participation in the difference.
(c) If the Agent's Spot Rate of Exchange for the next Interest Period shows
an appreciation or depreciation of the Optional Currency against
Dollars of less than five per cent. when
30
compared with the Original Exchange Rate, no amounts are payable in
respect of the difference. In this Clause 10.6 and in Clause 10.7
(Prepayments and repayments) "Original Exchange Rate" means the Agent's
Spot Rate of Exchange used for determining the amount of the Optional
Currency for the Interest Period which is the later of the following:
(i) the Interest Period during which the Tranche A Advance or
Term-out Advance was first denominated in that Optional
Currency if the Tranche A Advance or Term-out Advance has
since then remained denominated in that Optional Currency; and
(ii) the most recent Interest Period immediately prior to which a
difference was required to be paid under this Clause 10.6.
10.7 Prepayments and repayments
If a Tranche A Advance or Term-out Advance is to be repaid or prepaid
by reference to an Original Dollar Amount, the Optional Currency amount
to be repaid or prepaid shall be determined by reference to the Agent's
Spot Rate of Exchange last used for determining the Optional Currency
amount of that Tranche A Advance or Term-out Advance under this Clause
10 or, if applicable, the Original Exchange Rate.
10.8 Notification of rates of interest
The Agent will promptly notify each relevant Party of the determination
of a rate of interest under this Agreement.
11. OPTIONAL CURRENCIES
11.1 Change of Currency
If, before 9.00 a.m. on the Rate Fixing Date of an Advance to be
denominated in an Optional Currency other than Sterling, the Agent
receives notice from a Bank that:
(a) it is unable to fund the Advance in that Optional Currency by
reason of any circumstance affecting the London interbank
market generally; or
(b) the advance by the Bank of the proposed Optional Currency
might contravene any law or regulation applicable to that
Bank,
then:
(i) the Agent shall promptly and in any event before 9.30am on
that day notify the relevant Borrower;
(ii) unless the Agent receives notice from the Borrower by
10.00a.m. on that day, the Advance shall not be made;
(iii) if the Agent receives a notice under sub-paragraph (ii) above,
the Advance will be denominated instead in U.S. Dollars in an
amount equal to its Original Dollar Amount; and
(iv) the Borrower shall forthwith on demand indemnify the Bank
concerned against any broken funding loss or liability
incurred by it as a consequence of the occurrence of any such
event and the operation of this Clause 11.1.
31
11.2 Notification of rates and amounts
The Agent shall notify each relevant Party of any applicable Agent's Spot
Rate of Exchange or Original Dollar Amount promptly after it is
ascertained.
12. PAYMENTS
12.1 Place of Payment
All payments by a Borrower or a Bank under this Agreement shall be made
to the Agent to its account at such office or bank in the principal
financial centre of the country of the currency concerned as it may
notify to the Borrower or Bank for this purpose.
12.2 Funds
Payments under this Agreement to the Agent shall be made for value on the
due date at such times and in such funds as the Agent may specify to the
Party concerned as being customary at the time for the settlement of
transactions in the relevant currency in the place for payment.
12.3 Distribution
(a) Each payment received by the Agent under this Agreement 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 for the
account of 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 forthwith on demand refund the corresponding
amount to the Agent together with interest on that amount from the date
of payment to the date of receipt, calculated at a rate reasonably
determined by the Agent to reflect its cost of funds.
12.4 Currency
(a) A repayment or prepayment of a Utilisation is payable in the currency in
which the Advance is denominated.
(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, taxes and the like are
payable in the currency in which they are incurred.
32
(d) Any other amount payable under this Agreement is, except as otherwise
provided in this Agreement, payable in Dollars.
12.5 Set-off and counterclaim
All payments made by a Borrower under this Agreement shall be made
without set-off or counterclaim.
12.6 Non-Business Days
(a) If a payment under this Agreement 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 the principal at the rate payable
on the original due date.
12.7 Partial payments
(a) If the Agent receives a payment insufficient to discharge all the amounts
then due and payable by a Borrower under this Agreement, the 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 costs, fees
and expenses of the Agent under this Agreement;
(ii) secondly, in or towards payment pro rata of any accrued fees due
but unpaid under Clause 22 (Fees);
(iii) thirdly, in or towards payment pro rata of any interest due but
unpaid under this Agreement;
(iv) fourthly, in or towards payment pro rata of any principal due but
unpaid under this Agreement; and
(v) fifthly, in or towards payment pro rata of any other sum due but
unpaid under this Agreement.
(b) The Agent shall, if so directed by all the Banks, vary the order set out
in sub-paragraphs (a)(ii) to (v) above.
(c) Paragraphs (a) and (b) above shall override any appropriation made by any
Obligor.
13. TAXES
13.1 Gross-up
(a) All payments by an Obligor under the Finance Documents shall be made free
and clear of and without deduction for or on account of any taxes, except
to the extent that the Obligor is required by law to make payment subject
to any taxes. Subject to paragraph (b) below, if any tax or amounts in
respect of tax must be deducted from any amounts payable or paid by an
Obligor, or paid or payable by the Agent to a Finance Party, under the
Finance Documents, the Obligor shall pay such additional amounts as may
be necessary to ensure that the relevant
33
Finance Party receives a net amount equal to the full amount which it
would have received had payment not been made subject to tax.
(b) A Borrower is not obliged to pay any additional amount pursuant to
paragraph (a) above in respect of any deduction which would not have been
required if the relevant Finance Party had completed a declaration, claim
or exemption or other form which it is able to complete.
13.2 Tax receipts
All taxes required by law to be deducted or withheld by an Obligor from
any amounts paid or payable under the Finance Documents shall be paid by
the relevant Obligor when due and the Obligor concerned shall, within 15
days of the payment being made, deliver to the Agent for the relevant
Bank evidence satisfactory to that Bank (including all relevant tax
receipts received by it) that the payment has been duly remitted to the
appropriate authority.
13.3 Qualifying Bank
If:
(a) at the date of this Agreement any Bank is not a Qualifying Bank;
or
(b) a Bank ceases to be a Qualifying Bank other than as a direct
result of the introduction of, suspension, withdrawal or
cancellation of, or change in, or change in the official
interpretation, administration or official application of, any
law or regulation having the force of law or any published
practice or published concession of the UK Inland Revenue or any
other relevant taxing or fiscal authority in any jurisdiction
with which the relevant Bank has a connection, occurring after
the date of this Agreement; or
(c) on the date of any novation under Clause 28 (Changes to the
Parties) a New Bank (as such term is defined in that Clause) is
not a Qualifying Bank,
then no Obligor shall be liable to pay to that Bank under Clause 13.1
(Gross-up) any amount in respect of taxes levied or imposed by the UK or
any taxing authority of or in the UK in excess of the amount it would
have been obliged to pay if that Bank had been a Qualifying Bank.
13.4 U.S. Taxes
(a) No U.S. Borrower shall be required to pay any additional amount pursuant
to Clause 13.1 (Gross-up) in respect of United States taxes (including,
without limitation, federal, state, local or other income taxes), branch
profits or franchise taxes with respect to a sum payable by it pursuant
to this Agreement to a Bank if:
(i) on the date such Bank becomes a Party to this Agreement or has
designated a new Facility Office either:
(1) in the case of a Bank which is not a United States person
(as such term is defined in Section 7701(a)(30) of the
Code), such Bank is not entitled to submit a Form 1001 or
Form W-8 (relating to such Bank and claiming a complete
exemption from withholding on interest payable pursuant to
this Agreement) (or successor forms including a Form W-8BEN)
or a Form 4224 (or successor forms including a Form W-8EC1)
with respect to interest payable pursuant to this Agreement; or
34
(2) such Bank is subject to such tax by reason of any connection
between the jurisdiction imposing such tax and the Bank or
its Facility Office other than a connection arising solely
from this Agreement or any transaction contemplated hereby;
or
(ii) such Bank has (unless the relevant U.S. Borrower failed to make a
request referred to in paragraph (b) or (c) below) failed to
submit any form, certificate or other information with respect to
such sum payable that it was required to file pursuant to
paragraph (b) or (c) below and is entitled to file under
applicable law.
(b) If a Bank is not a United States person (as such term is defined in
Section 7701(a)(30) of the Code) it shall (if and to the extent that it
is entitled to do so under applicable law) submit, as soon as reasonably
practicable, (i) after it has become a Party to this Agreement or (ii)
designated a new Facility Office or, (iii) as the case may be, after
there is any U.S. Borrower, and before any payment is made under this
Agreement after an event described in (i), (ii) or (iii) of this
paragraph (b) has occurred, in duplicate to each U.S. Borrower duly
completed and signed copies of either Form 1001 (or successor form
including a Form W-8BEN) of the United States Internal Revenue Service
(relating to such Bank and claiming complete exemption from withholding
on all amounts (to which such withholding would otherwise apply) to be
received by such Bank, including fees, pursuant to this Agreement in
connection with any borrowing by such U.S. Borrower) as a result of a tax
treaty concluded with the United States or Form 4224 (or successor form
including a Form W-8EC1)of the United States Internal Revenue Service
(relating to all amounts (to which such withholding would otherwise
apply) to be received by such Bank, including fees, pursuant to this
Agreement in connection with any borrowing by such U.S. Borrower).
Thereafter and from time to time upon the reasonable request of a U.S.
Borrower, such Bank shall (if and to the extent that it is entitled to do
so under applicable law) submit to such U.S. Borrower such additional
duly completed and signed copies of one or the other such forms (or such
successor forms as shall be adopted from time to time by the relevant
United States taxation authorities) or any additional information, in
each case as may be required under then current United States law or
regulations to claim the inapplicability of or exemption from United
States withholding taxes on payments in respect of all amounts (to which
such withholding would otherwise apply) to be received by such Bank,
including fees, pursuant to this Agreement in connection with any
borrowing by such U.S. Borrower.
(c) If a Bank is a United States person (as such term is defined in Section
7701(a)(30) of the Code) it shall, as soon as practicable after it has
become a Party to this Agreement or designated a new Facility Office or,
as the case may be, after there is any U.S. Borrower, and thereafter upon
the reasonable request of a U.S. Borrower, submit in duplicate to such
U.S. Borrower a certificate to the effect that it is such a United States
person and shall (if and to the extent that it is entitled to do so under
applicable law) upon the reasonable request of a U.S. Borrower submit any
additional information that may be necessary to avoid United States
withholding taxes on all payments, including fees, (to which such
withholding would otherwise apply) to be received pursuant to this
Agreement in connection with any borrowing by such U.S. Borrower.
13.5 Collecting Agents Rules
Each Bank represents to the Agent that, in the case of a Bank which is a
Bank, on the date of this Agreement and, in the case of a Bank which
becomes a Bank after the date of this Agreement, on the date it becomes a
Bank, in relation to the Facilities, it is:
35
(a) either:
(i) not resident in the United Kingdom for United Kingdom tax
purposes; or
(ii) a bank as defined in section 840A of the Income and Corporation
Taxes Act 1988 and resident in the United Kingdom; and
(b) beneficially entitled to the principal and interest payable by the
Agent to it under this Agreement,
(or, if it is not able to make those representations, will ensure that it
assigns, transfers or novates its rights in respect of each Advance then
made (or, if made later, when made) to an entity in respect of which both
representations are correct) and, if it is able to make those
representations on the date of this Agreement or the date it becomes a
Bank, shall forthwith notify the Agent if either representation ceases to
be correct.
13.6 Tax Credit
(a) If an Obligor makes a payment pursuant to Clause 13.1 (Gross-up) for the
account of any Finance Party and such Finance Party has received or been
granted a credit against, or relief or remission or repayment of, any tax
paid or payable by it (a "Tax Credit") which is attributable to that
payment or the corresponding payment under the Finance Document such
Finance Party 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 Obligor concerned such amount as the Finance Party
shall have reasonably determined to be attributable to such payments and
which will leave the Finance Party (after such payment) in no better or
worse position than it would have been if the Obligor concerned had not
been required to make any deduction or withholding.
(b) Nothing in this Clause 13.4 shall interfere with the right of a Finance
Party to arrange its tax affairs in whatever manner it thinks fit and
without limiting the foregoing no Finance Party shall be under any
obligation to claim a Tax Credit or to claim a Tax Credit in priority to
any other claims, relief, credit or deduction available to it. No Finance
Party shall be obliged to disclose any information relating to its tax
affairs or any computations in respect thereof.
14. MARKET DISRUPTION
14.1 Market disturbance
Notwithstanding anything to the contrary herein contained, if and each
time that prior to or on a Utilisation Date relative to an Advance to be
made (or the first day of any Interest Period in the case of an
outstanding Tranche A Advance or Term-out Advance) or Xxxx to be drawn
hereunder:
(a) in the case of Advances, it is not possible to determine LIBOR in
accordance with paragraph (i) of the definition of LIBOR and only
one or no Reference Bank supplies a rate for the purposes of
determining LIBOR in accordance with paragraph (ii) of such
definition or the Agent is notified by the Majority Banks that by
reason of circumstances affecting the London interbank market
generally, adequate and fair means do not exist for ascertaining
the LIBOR applicable to such Advance during its Interest Period
or Term or LIBOR does not adequately represent the cost of
funding to the Banks; or
36
(b) in the case of Bills, the Agent shall have been notified by the
Majority Banks that the Bills do not comply with the then current
Bank of England regulations for Sterling bankers' acceptances or
that, by reason of circumstances affecting the London discount
market generally, adequate and fair means do not exist for
ascertaining the EBDR applicable to such Xxxx,
the Agent shall promptly give written notice of such notification to the
Company and to each of the Banks.
14.2 Alternative Rates
If the Agent gives a notice under Clause 14.1 (Market Disturbance):
(a) the Company and the Banks may (through the Agent) agree that
(except in the case of any Interest Period for a Tranche A
Advance or a Term-out Advance other than the first) the Advances
or Bills concerned shall not be borrowed or accepted; and
(b) during the period of 21 days after the giving of any notice by
the Agent pursuant to Clause 14.1 (Market disturbance), the Agent
(in consultation with the Banks) shall at the Company's request
negotiate with the Company in good faith with a view to
ascertaining whether a substitute basis (a "Substitute Basis")
may be agreed for the making of further Utilisations and/or the
maintaining of any existing Utilisations. If a Substitute Basis
is agreed by all the Banks and the Company it shall apply in
accordance with its terms from the Utilisation Date of each
Utilisation which is drawndown thereafter. The Agent shall not
agree any Substitute Basis on behalf of any Bank without any
prior consent of that Bank and such Substitute Basis shall be
reviewed by the Agent (acting on the instructions of the Banks)
on a monthly basis; and
(c) in the absence of an agreement under (a) above or a Substitute
Basis:
(i) if Clause 14.1(b) applies, the Banks which were to accept
Bills will make Tranche B Advances in Sterling to the Borrower
concerned in their place in an amount equal to the amount of
the Bills to be accepted;
(ii) the Interest Period or Term of the Advances concerned (which
includes any Advance made as a result of the operation of
sub-clause 14.2(c)(i) above) shall be one month; and
(iii) during the Interest Period or Term of each Advance the rate
of interest applicable to such Advance shall be the
applicable Margin plus applicable Mandatory Costs plus the
rate per annum notified by each Bank concerned to the Agent
before the last day of such Interest Period or Term to be
that which expresses as a percentage rate per annum the cost
to such Bank of funding such Advances from whatever sources
it may reasonably select.
15. INCREASED COSTS
15.1 Increased costs
(a) Subject to Clause 15.2 (Exceptions), the Company shall within 5 Business
Days of demand by a Finance Party pay that Finance Party the amount of
any increased cost incurred by it as a
37
result of any change in or introduction of any law or regulation
(including any relating to taxation or reserve asset, special deposit,
cash ratio, liquidity or capital adequacy requirements or any other form
of banking or monetary control).
(b) In this Agreement "increased cost" means:
(i) an additional cost incurred by a Finance Party or any of its
holding companies as a result of it performing, maintaining or
funding its obligations under, this Agreement; or
(ii) that portion of an additional cost incurred by a Finance Party or
any of its holding companies in making, funding or maintaining
all or any advances comprised in a class of advances formed by or
including the Advances made or to be made by it under this
Agreement as is attributable to it making, funding or maintaining
its Advances; or
(iii) a reduction in any amount payable to a Finance Party or the
effective return to a Finance Party under this Agreement or on
its capital (or the capital of any of its holding companies); or
(iv) the amount of any payment made by a Finance Party, or the amount
of interest or other return foregone by a Finance Party,
calculated by reference to any amount received or receivable by a
Finance Party from any other Party under this Agreement.
15.2 Exceptions
Clause 15.1 (Increased costs) does not apply to any increased cost:
(a) compensated for by the payment of the Mandatory Cost;
(b) attributable to any tax or amounts in respect of tax which must
be deducted from any amounts payable or paid by a Borrower or
paid or payable by the Agent to a Bank under the Finance
Documents;
(c) which is, or is attributable to, any tax on the overall net
income, profits or gains of a Bank or any of its holding
companies (or the overall net income, profits or gains of a
division or branch of the Bank or any of its holding companies);
(d) arising directly out of the implementation by the applicable
authorities having jurisdiction over such Bank and/or its
Facility Office of the matters set out in 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 the directives of
the European Council (as amended or supplemented prior to the
date of this Agreement) of 17th April, 1989 on the own funds of
credit institutions (89/229/EEC) and of 18th December, 1989 on
the solvency ratio for credit institutions (89/647/EEC), in each
case to the extent and according to the timetable provided for
therein.
38
16. ILLEGALITY AND MITIGATION
16.1 Illegality
If it 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 any Advance or Xxxx, then the Bank may notify the Company
through the Agent accordingly and thereupon:
(a) each Borrower shall, to the extent required and within the period
allowed or if no period is allowed, forthwith, repay any Advances
made to it by that Bank together with all other amounts payable
by it to that Bank under this Agreement;
(b) each Borrower shall, to the extent required and within the period
allowed or if no period is allowed, forthwith, perform its
obligations under Clause 8.3 (Payment of Bills) in respect of all
outstanding Bills accepted by that Bank; and
(c) the Bank's Tranche A Commitment, Tranche B Commitment and Tranche
C Commitment shall be cancelled.
16.2 Mitigation
Notwithstanding the provisions of Clauses 13 (Taxes), 15 (Increased
Costs) and 16.1 (Illegality), if in relation to a Bank or (as the case
may be) the Agent circumstances arise which would result in:
(a) any deduction, withholding or payment of the nature referred to
in Clause 13 (Taxes); or
(b) any increased cost of the nature referred to in Clause 15
(Increased Costs); or
(c) a notification pursuant to Clause 16.1 (Illegality),
then without in any way limiting, reducing or otherwise qualifying the
rights of such Bank or the Agent, such Bank shall promptly upon becoming
aware of the same notify the Agent thereof (whereupon the Agent shall
promptly notify the Company) and such Bank shall use reasonable
endeavours to transfer its participation in the Facility and its rights
hereunder and under the Finance Documents to another financial
institution or Facility Office not affected by the circumstances having
the results set out in (a), (b) or (c) above and shall otherwise take
such reasonable steps as may be open to it to mitigate the effects of
such circumstances provided that such Bank shall not be under any
obligation to take any such action if, in its bona fide written opinion,
to do so would or would be likely to have a material adverse effect upon
its business, operation or financial condition or would involve it in any
unlawful activity or any activity that is contrary to any request,
guidance or directive of any competent authority (whether or not having
the force of law) or (unless indemnified to its satisfaction) would
involve it in any expense or tax disadvantage.
17. GUARANTEE
17.1 Guarantee
Each Guarantor irrevocably and unconditionally:
39
(a) as principal obligor and notwithstanding the release of any other
Obligor or any other person under the terms of any composition or
arrangement with any creditors of any member of the Group,
guarantees to each Finance Party prompt performance by each
Borrower of all its obligations under the Finance Documents;
(b) undertakes with each Finance Party that whenever a Borrower does
not pay any amount when due under or in connection with any
Finance Document, such Guarantor shall forthwith on demand by the
Agent pay that amount as if such Guarantor instead of the
relevant Borrower were expressed to be the principal obligor; and
(c) indemnifies each Finance Party on demand against any loss or
liability suffered by it if any obligation guaranteed by that
Guarantor is or becomes unenforceable, invalid or illegal.
17.2 Continuing guarantee
This guarantee is a continuing guarantee and will extend to the ultimate
balance of all sums payable by the Borrowers under the Finance Documents,
regardless of any intermediate payment or discharge in whole or in part.
17.3 Reinstatement
(a) Where any discharge (whether in respect of the obligations of any Obligor
or any security for those obligations or otherwise) is made in whole or
in part or any arrangement is made on the faith of any payment, security
or other disposition which is avoided or must be restored on insolvency,
liquidation or otherwise without limitation, the liability of the
Guarantors under this Clause 17 shall continue as if the discharge or
arrangement had not occurred (but only to the extent that such payment,
security or other disposition is avoided or restored).
(b) Each Finance Party may concede or compromise any claim that any payment,
security or other disposition is liable to avoidance or restoration.
17.4 Waiver of defences
The obligations of the Guarantors under this Clause 17 will not be
affected by any act, omission, matter or thing which, but for this
provision, would reduce, release or prejudice any of its obligations
under this Clause 17 or prejudice or diminish those obligations in whole
or in part, including (whether or not known to it or any Finance Party):
(a) any time or waiver granted to, or composition with, any Obligor
or other person;
(b) the taking, variation, compromise, exchange, renewal or release
of, or refusal or neglect to perfect, take up or enforce, any
rights against, or security over assets of, any Obligor or other
person or any non-presentation or non-observance of any formality
or other requirement in respect of any instrument or any failure
to realise the full value of any security;
(c) any incapacity or lack of powers, authority or legal personality
of or dissolution or change in the members or status of any
Obligor or any other person;
40
(d) any variation (however fundamental) or replacement of a Finance
Document or any other document or security so that references to
that Finance Document in this Clause 17 shall include each
variation or replacement;
(e) any unenforceability, illegality or invalidity of any obligation
of any person under any Finance Document or any other document or
security, to the intent that each Guarantor's obligations under
this Clause 17 shall remain in full force and its guarantee be
construed accordingly, as if there were no unenforceability,
illegality or invalidity; and
(f) any postponement, discharge, reduction, non-provability or other
similar circumstance affecting any obligation of any Obligor
under a Finance Document resulting from any insolvency,
liquidation or dissolution proceedings or from any law,
regulation or order so that each such obligation shall for the
purposes of each Guarantor's obligations under this Clause 17
shall be construed as if there were no such circumstance.
17.5 Immediate recourse
Each Guarantor waives any right it may have of first requiring any
Finance Party (or any trustee or agent on its behalf) to proceed against
or enforce any other rights or security or claim payment from any person
before claiming from that Guarantor under this Clause 17.
17.6 Appropriations
(a) Until all amounts which may be or become payable by the Borrowers under
or in connection with the Finance Documents have been irrevocably paid in
full, each Finance Party (or any trustee or agent on its behalf) may:
(i) refrain from applying or enforcing any other moneys, security or
rights held or received by that Finance Party (or any trustee or
agent on its behalf) in respect of those amounts, or apply and
enforce the same in such manner and order as it sees fit (whether
against those amounts or otherwise) and no Guarantor shall be
entitled to the benefit of the same; and
(ii) hold in a suspense account any moneys received from a Guarantor
or on account of that Guarantor's liability under this Clause 17.
(b) If:
(i) the amount of any moneys in the suspense account referred to
in sub-paragraph (a)(ii) equals or exceeds the maximum
amount which may be or become payable under the Finance
Documents; and
(ii) the relevant Finance Party is satisfied that payment of the
moneys in discharge of all amounts which are or may be
outstanding under the Finance Documents will not be
subsequently clawed-back, avoided or restored,
then each Finance Party (or its trustee or agent on its behalf)
shall apply those moneys in discharge of all amounts outstanding
under the Finance Documents.
41
17.7 Non-competition
Until all amounts which may be or become payable by the Borrowers under
or in connection with the Finance Documents have been paid in full, no
Guarantor shall, after a claim has been made or by virtue of any payment
or performance by it under this Clause 17:
(a) be subrogated to any rights, security or moneys held, received or
receivable by any Finance Party (or any trustee or agent on its
behalf) or be entitled to any right of contribution or indemnity
in respect of any payment made or moneys received on account of
any Guarantor's liability under this Clause 17;
(b) claim, rank, prove or vote as a creditor of any Borrower or its
estate in competition with any Finance Party (or any trustee or
agent on its behalf); or
(c) receive, claim or have the benefit of any payment, distribution
or security from or on account of any Borrower, or exercise any
right of set-off as against any Borrower.
Each Guarantor shall hold in trust for and forthwith pay or transfer to
the Agent for the Finance Parties any payment or distribution or benefit
of security received by it contrary to this Clause 17.7.
17.8 Additional security
This guarantee is in addition to and is not in any way prejudiced by any
other security now or hereafter held by any Finance Party.
17.9 Limitation on guarantee of U.S. Guarantors
Notwithstanding any other provision of this Clause 17, the obligations of
each Guarantor incorporated in the United States (a "U.S. Guarantor")
under this Clause 17 shall be limited to a maximum aggregate amount equal
to the largest amount that would not render its obligations hereunder
subject to avoidance as a fraudulent transfer or conveyance under Section
548 of Title 11 of the United States Bankruptcy Code or any applicable
provisions of comparable state law (collectively, the "Fraudulent
Transfer Laws"), in each case after giving effect to all other
liabilities of such U.S. Guarantor, contingent or otherwise, that are
relevant under the Fraudulent Transfer Laws (specifically excluding,
however, any liabilities of such U.S. Guarantor in respect of
intercompany indebtedness to the Borrowers or Affiliates of the Borrowers
to the extent that such indebtedness would be discharged in an amount
equal to the amount paid by such U.S. Guarantor hereunder) and after
giving effect as assets to the value (as determined under the applicable
provisions of the Fraudulent Transfer Laws) of any rights to subrogation,
contribution, reimbursement, indemnity or similar rights of such U.S.
Guarantor pursuant to (a) applicable law or (b) any agreement providing
for an equitable allocation among such U.S. Guarantor and other
Affiliates of the Borrowers of obligations arising under guarantees by
such parties.
17.10 Release of Guarantee
(a) The Company may from time to time deliver a request to the Agent for a
Guarantor (other than the Company) to be released as a Guarantor.
(b) Each request under paragraph (a) above shall be accompanied by a
certificate addressed to the Finance Parties from a director of the
Company:
42
(i) certifying that no Default is subsisting or would result from the
proposed release;
(ii) setting out in reasonable detail calculations demonstrating that
the Company will continue to be in compliance with Clause 19.11
(Subsidiary Borrowings) after the release of the Guarantor.
(c) As soon as reasonably practicable following receipt of a certificate
complying with paragraph (b) above the Agent shall, if it has not
received notice of any Default that is subsisting, execute on behalf of
the Finance Parties such documents as are required to effect the release
of the relevant Guarantor.
(d) The Guarantor concerned shall cease to be a Guarantor on the date the
release document referred to in paragraph (c) above is executed by the
Agent.
18. REPRESENTATIONS AND WARRANTIES
18.1 Representations and warranties
(a) Each Obligor makes the representations and warranties set out in this
Clause 18 (Representations and Warranties) to each Finance Party (but in
the case of an Obligor other than the Company only in respect of
themselves).
(b) The representations and warranties set out in this Clause 18
(Representations and Warranties) which relate to Bidco shall not apply to
Bidco after completion of the Merger.
18.2 Status
(a) It is a limited liability company and Bidco is a corporation, duly
incorporated and validly existing under the laws of the jurisdiction of
its incorporation; and
(b) each member of the Group has the power to own its assets and carry on its
business as it is being conducted.
18.3 Powers and authority
It and Bidco has the power to enter into and perform, and has taken all
necessary action to authorise the entry into, performance and delivery
of, the Transaction Documents to which it is or will be a party and the
transactions contemplated by those Transaction Documents.
18.4 Legal validity
Each Transaction Document to which it or Bidco is or will be a party
constitutes, or when executed in accordance with its terms will
constitute, its legal, valid and binding obligations enforceable in
accordance with its terms subject, as to matters of law, to the
qualifications contained in the legal opinions referred to in Schedule 2.
18.5 Non-conflict
The entry into and performance by it and Bidco of, and the transactions
contemplated by, the Transaction Documents do not and will not conflict
with:
(a) any law or regulation or judicial or official order; or
43
(b) the constitutional documents of any member of the Group; or
(c) 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.
18.6 No default
(a) No Event of Default is outstanding or would result from any Utilisation;
and
(b) no other event is outstanding which constitutes (or, with the giving of
notice, lapse of time, determination of materiality or the fulfilment of
any other applicable condition or any combination of the foregoing, is
reasonably likely to constitute) a default under any document which is
binding on any member of the Group or any asset of any member of the
Group to an extent or in a manner which is reasonably likely to have a
material adverse effect.
18.7 Authorisations
All authorisations required in connection with the entry into,
performance, validity and enforceability of, and the transactions
contemplated by, the Transaction Documents have been obtained or effected
(as appropriate) and are in full force and effect.
18.8 Accounts
(a) In the case of the Company, the audited consolidated accounts of the
Group most recently delivered to the Agent (which, at the date of this
Agreement, are the Original Group Accounts):
(i) have been prepared in accordance with accounting principles and
practices generally accepted in the United Kingdom consistently
applied; and
(ii) fairly represent the consolidated financial condition of the
Group as at the date to which they were drawn up,
and, excluding for this purpose only any reduction in tangible net worth
or interest cover or any increased indebtedness immediately following the
acquisition of the Target directly resulting from the acquisition, as at
the date of this Agreement or, in the case of audited accounts delivered
to the Agent after the date of this Agreement, the date such accounts are
delivered to the Agent there has been no change in the consolidated
financial condition of the Group since the date to which those accounts
were drawn up which would be reasonably likely to have a material adverse
effect.
(b) In the case of each Additional Borrower, its accounts most recently
delivered to the Agent under Clause 19.2(a)(ii):
(i) have been prepared in accordance with accounting principles and
practices generally accepted in the place of its incorporation
consistently applied; and
(ii) fairly represent its financial condition as at the date to which
they were drawn up.
44
18.9 Litigation
No litigation, arbitration or administrative proceedings in relation to
any member of the Group are current or, to its knowledge, pending or
threatened, which is reasonably likely to have a material adverse effect.
18.10 Information Memorandum
(a) The information contained in the information memorandum referred to in
Clause 19.15 (Syndication) (the "Information Memorandum") supplied by the
Company or on its behalf was true in all material respects as at its
date, opinions expressed in the Information Memorandum by or on behalf of
any member of the Group were honestly held, all projections in the
Information Memorandum were based on assumptions reasonably made, and all
such opinions and assumptions were provided in good faith and after
reasonable enquiry as to their accuracy.
(b) To the best of its knowledge, having made all reasonable enquiries, the
Information Memorandum did not omit as at that date any material
information which, if disclosed, could reasonably be expected to
adversely affect the decision of a person considering whether to enter
into this Agreement.
(c) Since the date of the material contained in the Information Memorandum,
so far as the Company is aware after making all reasonable enquiries,
nothing has occurred or come to light which renders any of the
information, expressions of opinion or intention, forecasts, projections
or conclusions and contained in the Information Memorandum inaccurate or
misleading to a material extent.
(d) In accordance with the obligations of the Company in Clause 19.14
(Syndication), the Company shall represent, on the date five Business
Days (the "relevant date") after the date on which the Arrangers notify
the Company that syndication of the Facilities has closed, that (except
as disclosed in writing by the Company to the Agent on or before the
relevant date) the Information Memorandum remains true and accurate in
all material respects and that opinions expressed in the Information
Memorandum remain honestly held and that the projections therein continue
to be based on assumptions reasonably made, such opinions and assumptions
being provided in good faith and after reasonable enquiry as to their
accuracy.
18.11 Security Interests
No Security Interest exists over the assets of any member of the Group
which would cause a breach of Clause 19.7 (Negative pledge).
18.12 Year 2000
Any reprogramming required to permit the proper functioning, in and
following the Year 2000 of (a) the Group's computer systems and (b)
equipment containing embedded microchips (including, systems and
equipment supplied by others or with which the Group's systems interface)
and the testing of all such systems and equipment, as so reprogrammed,
has been completed or will be completed in all material respects by 31st
August, 1999 (or, in the case of Target and its Subsidiaries, by 30th
September, 1999). The cost to the Group of such reprogramming and testing
and of the reasonably foreseeable consequences of Year 2000 to the Group
in respect of the matters referred to in the previous sentence
(including, without limitation, reprogramming errors and the failure of
others' systems or equipment) will not result in a Default or a material
adverse effect.
45
18.13 Environmental Matters
(a) Subject to sub-paragraph (c) below, each member of the Group has obtained
all material Environmental Licences required for the carrying on of its
business as currently conducted and has at all times on and from the date
this representation and warranty is first made in relation to it complied
in all material respects with (i) the terms and conditions of such
Environmental Licences and (ii) all other applicable Environmental Laws,
in each case, where failure to comply with such Environmental Licences
and Environmental Laws is reasonably likely to have a material adverse
effect. There are to its knowledge no circumstances currently existing
which would prevent or interfere with such compliance in the future (to
the extent any such failure to comply would have a material adverse
effect).
(b) There is no Environmental Claim pending or to the best of its knowledge
threatened, and to the best of its knowledge, having made all reasonable
enquiries, there are no past or present acts, omissions, events or
circumstances that would be reasonably likely to form the basis of any
Environmental Claim (including, without limitation, any arising out of
the generation, storage, transport, disposal or release of any Dangerous
Substance), against any member of the Group which if adversely determined
would have a material adverse effect.
(c) The representations and warranties in paragraphs (a) and (b) above shall
not apply to the Target and its Subsidiaries during the period ending on
the date three months after the date on which the Target becomes a
Subsidiary of the Company.
18.14 ERISA
Each member of the Controlled Group has fulfilled its obligations under
the minimum funding standards of ERISA and the Code with respect to each
Plan. Each member of the Controlled Group is in compliance with the
applicable provisions of ERISA, the Code and any other applicable United
States Federal or State law with respect to each Plan except where such
non-fulfilment or non compliance could not reasonably be expected to have
a material adverse effect. Each Plan complies in all material respects
with all applicable requirements of law and regulations, no Reportable
Event has occurred with respect to any Plan, and no steps have been taken
to reorganise or terminate any Single Employer Plan or by Obligors to
effect a complete or partial withdrawal from any Multiemployer Plan
except where such non compliance, Reportable Event, reorganisation,
termination or withdrawal could not reasonably be expected to have a
material adverse effect. No member of the Controlled Group has (a) sought
a waiver of the minimum funding standard under Section 412 of the Code in
respect of any Plan, (b) failed to make any contribution or payment to
any Single Employer Plan or Multiemployer Plan, or made any material
amendment to any Plan, and no other event, transaction or condition has
occurred which has resulted or could result in the imposition of a lien
or the posting of a bond or other security under ERISA or the Code or (c)
incurred any material, actual liability under Title I or Title IV of
ERISA other than a liability to the PBGC for premiums under Section 4007
of ERISA, except where any such event in (a), (b) or (c) could not
reasonably be expected to have a material adverse effect.
18.15 U.S. Borrowers
(a) No U.S. Borrower is an investment company under the United States
Investment Company Act of 1940, as amended, or is exempt from the
provisions of that Act pursuant to an exemption under that Act, all of
the conditions of which have been and are being fulfilled.
46
(b) None of the transactions contemplated in this Agreement (including,
without limitation, the borrowings hereunder and the use of the proceeds
thereof) will violate or result in a violation of Section 7 of the
Securities Exchange Act of 1934 (or any regulations issued pursuant
thereto, including, without limitation, Regulations G, T, U and X).
18.16 Times for making representations and warranties
The representations and warranties set out in this Clause 18:
(a) (except in the case of Clause 18.10 (Information Memorandum)) in
the case of the Company and the Original Guarantors, are made on
the date of this Agreement;
(b) (except in the case of Clause 18.10 (Information Memorandum)) in
the case of an Obligor which becomes a Party after the date of
this Agreement, will be deemed to be made by that Obligor on the
date it executes a Borrower Accession Agreement or, as the case
may be a Guarantor Accession Agreement (subject to any
disclosures agreed in writing by the Majority Banks before such
date);
(c) (except in the case of Clause 18.10 (Information Memorandum) and,
after 31st January, 2000, Clause 18.12 (Year 2000)) are deemed to
be repeated by each Obligor on:
(i) the date of each Request;
(ii) the first day of each Interest Period; and
(iii) each Utilisation Date with reference to the facts and
circumstances then existing; and
(d) (in the case of Clause 18.10 (Information Memorandum)) is made by
each Obligor on the date on which the Information Memorandum is
approved in writing by the Company (such approval not to be
unreasonably withheld or delayed).
19. UNDERTAKINGS
19.1 Duration
The undertakings in this Clause 19 (Undertakings) will 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.
19.2 Financial Information
Each Borrower shall supply to the Agent in 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):
(i) in the case of the Company, the audited consolidated
accounts of the Group for that financial year; and
(ii) in the case of each Borrower (other than the Company), its
accounts for that financial year, which accounts shall be
audited if required by applicable law;
47
(b) in the case of the Company, as soon as the same are available
(and in any event within 120 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;
(c) in the case of the Company, together with the accounts specified
in paragraphs (a)(i) and (b) above, a certificate signed by two
of its senior officers on its behalf:
(i) setting out in reasonable detail computations establishing
compliance with Clause 19.16 (Financial covenants) as at the
date to which those accounts were drawn-up;
(ii) identifying the Principal Subsidiaries on the basis of those
accounts; and
(iii) 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; and
(d) in the case of the Company, together with the accounts specified
in paragraph (a)(i) above, a certificate signed by its auditors:
(i) setting out in reasonable detail compositions establishing
compliance with Clause 19.16 (Financial covenants) as at the
date to which those accounts were drawn up; and
(ii) identifying the Principal Subsidiaries on the basis of those
accounts.
19.3 Information - Miscellaneous
The Company shall supply to the Agent:
(a) all documents despatched by it to all its shareholders (or any
class of them) or its creditors generally (or any class of them)
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 or pending, and which would, in the opinion of the
Directors of the Company be reasonably likely to be adversely,
determined and, if adversely determined, have a material adverse
effect; and
(c) promptly, such further information in the possession or control
of any member of the Group regarding its financial condition as
any Finance Party through the Agent may reasonably request,
in sufficient copies for all of the Banks, if the Agent so requests,
provided that the Company shall be under no obligation to supply:
(i) its or any of its Subsidiaries management accounts;
(ii) any information the supply of which would be contrary to its
obligations under its undertaking given to the Stock Exchange in
London or any other confidentiality obligation binding on the
Company or any of its Subsidiaries; or
48
(iii) any information which is, in the Company's reasonable opinion,
unpublished price-sensitive information within the meaning of the
Company Securities (Insider Dealing) Xxx 0000.
19.4 Notification of Default and Control Event
(a) The Company shall notify the Agent of any Default (and the steps, if any,
being taken to remedy it) promptly upon becoming aware of it.
(b) The Company shall notify the Agent in writing of any Control Event within
14 days after the Company becomes aware of such Control Event.
19.5 Authorisations
Each Obligor shall promptly:
(a) obtain, maintain and comply with the terms of; and
(b) at the Agent's reasonable request, 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 enforceability of,
any Finance Document.
19.6 Pari passu ranking
Each Obligor 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 obligations which from time
to time are mandatorily preferred by law applying to companies generally.
19.7 Negative pledge
No Obligor shall, and the Company shall procure that no other member of
the Group will, create or permit to subsist any Security Interest on any
of its assets other than Permitted Security Interests.
19.8 Disposals
No Obligor shall, and the Company shall procure that no other member of
the Group will, either in a single transaction or in a series of
connected transactions, and whether voluntarily or involuntarily, sell,
transfer, grant or lease or otherwise dispose of all or any part of its
assets where:
(a) the transaction or series of connected transactions concerned
constitute a Restricted Transaction; and
(b) the aggregate market value of the assets to be disposed of
pursuant to such Restricted Transaction exceeds 'L'30,000,000
or its equivalent in other currencies.
19.9 Acquisitions
No Obligor shall, and the Company shall procure that no other member of
the Group will, either in a single transaction or a series of connected
transactions, acquire any assets where:
49
(a) the transaction or series of connected transactions concerned
constitute a Restricted Transaction; and
(b) the aggregate value of the cash and non-cash consideration
(as valued by the Company's auditors) payable by the Group
in respect of such Restricted Transaction exceeds
'L'30,000,000 or its equivalent in other currencies.
19.10 Change of business
Save for disposals permitted by this Agreement, the Company shall procure
that no substantial change is made to the general nature of the Group's
business as it is conducted on the date of this Agreement and assuming
that the acquisition of the Target is completed in accordance with the
Offer Documents and the Merger Agreement.
19.11 Subsidiary Borrowings
The Company shall procure that no member of the Group which is not a
Guarantor has or incurs any Borrowing other than:
(a) any Borrowings incurred with the prior written consent of the
Majority Banks; or
(b) any Borrowings from the Company or any other member of the
Group; or
(c) any currency Borrowings subject to back to back currency
deposits used for the purposes of currency hedging; or
(d) any Borrowings of any company which becomes a new
Subsidiary of the Company after the date hereof, provided that
(i) the amount of such Borrowings is not increased over the
amount outstanding at the date it becomes a Subsidiary, and
(ii) all such Borrowings are repaid in full within six months
of the date on which such company became a Subsidiary; or
(e) Borrowings of Meggitt Funding Limited pursuant to the
CULS, provided that all the CULS are converted into ordinary
shares in Meggitt Funding Limited within 5 Business Days after
the Unconditional Date; or
(f) any other Borrowings, provided that (excluding for this
purpose Borrowings permitted under sub-clauses (a) to (e)
above) the maximum aggregate principal amount of such
Borrowings does not exceed 'L'40,000,000 or its equivalent
in other currencies.
19.12 The Offer and the Merger
(a) The Company shall not, and shall procure that Bidco and each other
member of the Group will not amend, waive or vary any Offer Document or
the Merger Agreement (or agree to any of the foregoing) in any respect
which would:
(i) result in the aggregate cash consideration payable by the
Group in respect of the Offer and the Merger exceeding the sum
of US$330,000,000 and the net proceeds applied in accordance
with Clause 4.2(a)(ii);
50
(ii) result in the "Minimum Condition" (as defined in the
Merger Agreement) being reduced below a majority of the common
stock of Target on a fully diluted basis;
(iii) waive or dispense with any requirement for any material
authorisation or regulatory waiting period pursuant to the
Offer Documents or the Merger Agreement; or
(iv) result in any amendment, waiver or variation of or to any
of the conditions specified in Annex I of the Merger Agreement
in a manner and to an extent which could reasonably be
expected to materially and adversely affect the interests of
the Finance Parties under the Finance Documents.
(b) The Company shall not, and shall procure that Bidco and no other member
of the Group will, issue or allow to be issued any press release or other
publicity, the text of which has not previously been agreed with the
Arrangers (such agreement not to be unreasonably withheld or delayed),
which makes reference to the Facilities or any Finance Party unless the
publicity is required by law, any applicable regulation or any stock
exchange (in which case the Company shall (i) notify the Agent and the
Arrangers as soon as it becomes aware that the publicity is required and
(ii) consult with the Arrangers in good faith as to the contents of the
publicity).
(c) The Company shall, and shall ensure that Bidco and each other member of
the Group will, comply in all material respects with all applicable laws
and regulations in relation to the Offer and the Merger.
(d) The Company will procure that the Merger is completed in the manner
contemplated in the Merger Agreement as soon as practicable after the
Unconditional Date and in any event within 120 days after the
Unconditional Date.
(e) The Company will procure that the Target becomes a Guarantor in
accordance with Clause 28.5 within ten Business Days after the date on
which the Merger is completed.
(f) The Company shall ensure that within 5 Business Days of the Unconditional
Date the CULS are converted into ordinary shares in Meggitt Funding
Limited and those ordinary shares are exchanged for ordinary shares in
the Company, in each case in accordance with the deed poll constituting
the CULS.
19.13 Insurance
Each Obligor will, and the Company shall procure that each of its
Subsidiaries will, effect insurances over and in respect of its assets
and business against such risks and to such extent and in such a manner
as is usual for companies carrying on such a business in the country
concerned.
19.14 Syndication
At the request of the Arrangers, the Company will assist the Arrangers in
syndicating the Facilities, including (a) the preparation with the
Arrangers of a confidential information memorandum and the supply of
other marketing and financial materials reasonably required for use in
syndication and (b) direct contact, including the hosting of one or more
bank meetings, between senior management of the Company on the one hand
and potential Banks and prospective participants (in each case chosen by
the Arrangers in consultation with the
51
Company) on the other hand, and comply with all reasonable requests for
information from potential Banks and participants made through the
Arrangers.
19.15 Hedging Strategy
The Company shall procure that the Hedging Strategy is implemented
substantially in accordance with its terms.
19.16 Financial covenants
(a) In this Clause 19.16:
"Cash and Investments" means cash in hand, cash at bank, deposits,
negotiable or other readily marketable investments or securities and
other investments of a similar nature;
"Net Debt" at any time, means the aggregate consolidated Borrowings of
the Group from sources external to the Group, less all Cash and
Investments of the Group;
"Net Interest Costs" means, in respect of any 12 month period of the
Group, the sum of (a) the amount of interest and similar charges payable
by the Group during such financial period determined by reference to the
latest audited annual consolidated accounts or the latest interim
financial statements of the Company less (b) the amount of interest
received or receivable and any similar income of the Group during such
financial period determined as aforesaid;
"EBITA" means, in respect of any 12 month period of the Group, Profit
Before Net Interest adjusted to eliminate any deduction for amortisation.
"EBITDA" means, in respect of any 12 month period of the Group, Profit
Before Net Interest adjusted to eliminate any deduction for depreciation
or amortisation.
"Profit Before Net Interest" means, in respect of any 12 month period of
the Group, the consolidated pre-tax profits of the Group for that period
but before deducting Net Interest Costs and before crediting or deducting
(as the case may be):
(a) amounts applicable to minorities, dividends or exceptional items; and
(b) items under (i) operating profits or losses of discontinued operations or
operations under review, (ii) provisions for profits or losses on
operations to be discontinued, (iii) profits or losses on disposal of
discontinued operations or (iv) provisions released against such items,
all as classified in or determined by reference to the latest financial
statements provided under Clause 19.2(a) or (b) and after annualising the
contribution to EBITDA of any company (including the Target) that becomes
a member of the Group after the beginning of any such 12 month period.
"Ratio Period" means each period of 12 months ending on 30th June and
31st December in each year.
(b) All the terms used in paragraph (a) above are to be calculated in
accordance with the accounting principles applied in connection with the
Original Group Accounts.
52
(c) If there is a dispute as to any interpretation of or computation for
paragraph (a) above, the interpretation or computation of the Company's
auditors will prevail.
(d) The Company shall procure that:
(i) Interest Cover
the ratio of EBITA to Net Interest Costs is not less than
3.00:1 in any Ratio Period; and
(ii) Debt/EBITDA
the ratio of Net Debt (as determined on the last day of each
Ratio Period in respect of which this ratio is tested) to
EBITDA shall not, in respect of any Ratio Period which ends in
a period set out in Column (1) below, exceed the ratio set
opposite such period in Column (2) below:
Column (1) Column (2)
Period Ratio
Up to and including 30th June, 2000 3.5:1
Thereafter 3.0:1
20. DEFAULT
20.1 Events of Default
Each of the events set out in Clauses 20.2 (Non-Payment) to 20.17
(Material adverse effect) (inclusive) is an Event of Default (whether or
not caused by any reason whatsoever outside the control of any Obligor or
any other person).
20.2 Non-payment
An Obligor does not pay any amount payable by it under the Finance
Documents at the place at and in the currency in which it is expressed to
be payable except where the failure to pay is due solely to technical or
administrative problems or delays in the transmission of funds which are
beyond the Obligor's control and payment is made within three Business
Days of the due date.
20.3 Breach of other obligations
(a) Any Obligor fails to comply with any of Clauses 19.6 (pari passu
ranking), 19.7 (Negative Pledge), 19.8 (Disposals), 19.9 (Acquisitions),
19.10 (Change of business), 19.11 (Subsidiary Borrowings), 19.12 (the
Offer and the Merger) or 19.16 (Financial covenants).
(b) An Obligor does not comply with any provision of the Finance Documents
(other than those referred to in Clause 20.2 (Non-Payment) and paragraph
(a) above) and such failure (if capable of remedy before the expiry of
such period) continues unremedied for a period of 30 days from the
earlier of (i) the date on which the Agent gives notice to the Company
requiring the same to be remedied and (ii) the date on which an Obligor
becomes aware of the same.
53
20.4 Misrepresentation
A representation, warranty or statement made or repeated by any Obligor
in or in connection with any Finance Document or in any document
delivered by or on behalf of any Obligor under or in connection with any
Finance Document is incorrect in any material respect when made or deemed
to be made or repeated.
20.5 Cross-default
(a) Any Borrowings of a member of the Group are not paid when due or within
any applicable grace period provided in the documentation therefor; or
(b) any Borrowings of a member of the Group become prematurely due and
payable or are placed on demand (or become capable of being declared
prematurely due and payable or placed on demand) in each case as a result
of an event of default (howsoever described) under the document relating
to those Borrowings; or
(c) any Security Interest securing Borrowings over any asset of a member of
the Group becomes enforceable,
except that this Clause 20.5 shall not apply to:
(i) Borrowings of Group members the principal or settlement
amounts of which are in aggregate 'L'10,000,000 or less;
or
(ii) during the period of three months beginning on the date the
Target becomes a member of the Group, Borrowings of the Target
or its Subsidiaries outstanding as at the date it became a
member of the Group; or
(iii) during the period of three months starting on the date of this
Agreement, any Borrowings in a principal amount not exceeding
U.S.$60,000,000 under the 7 year private placement with certain
United States investors maturing in April 2000, to the extent
any circumstances described in paragraph (b) above are caused
by the execution of this Agreement, the Utilisation of all or
any part of the Total Commitments or the acquisition of the
Target pursuant to the Offer Documents and the Merger Agreement
and provided that any such Borrowings which are declared
prematurely due and payable are repaid within 5 Business Days
of becoming due and payable.
20.6 Insolvency
(a) An Obligor or a Principal Subsidiary is, or is deemed for the purposes of
any law to be, unable to pay its debts as they fall due, or to be
insolvent, or admits inability to pay its debts as they fall due;
(b) an Obligor or a Principal Subsidiary suspends making payments on all or
any class of its debts or announces an intention to do so, or a
moratorium is declared in respect of any of its indebtedness; or
(c) an Obligor or a Principal Subsidiary by reason of financial difficulties,
begins negotiations with all of its creditors or any class of them with a
view to the readjustment or rescheduling of any of its indebtedness.
54
20.7 Administration
(a) Any meeting of an Obligor or any Principal Subsidiary is convened for the
purpose of considering any resolution to present an application for an
administration order; or
(b) an Obligor or any Principal Subsidiary passes a resolution to present an
application for an administration order; or
(c) an application for an administration order in relation to an Obligor or
any Principal Subsidiary is presented to the court and either (i) such
Obligor or such Principal Subsidiary does not apply to the court within 7
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 21 days after such application for the
refusal of such petition; or
(d) an Obligor or any Principal Subsidiary has an administration order made
in relation to it.
20.8 Compositions etc.
An Obligor or any Principal Subsidiary has any voluntary arrangement
proposed in relation to it under Section 1 of the Insolvency Act 1986 or
enters into any other composition, scheme of arrangement, compromise or
arrangement involving an Obligor or such Principal Subsidiary and their
respective creditors generally (other than for the purposes of
reconstruction or amalgamation which is on a solvent basis and does not
involve any Obligor or which is otherwise upon terms and within such
period as may previously have been approved in writing by the Majority
Banks).
20.9 Winding up
(a) Any meeting of the shareholders of an Obligor or any Principal Subsidiary
is convened for the purpose of considering any resolution for (or to
petition for) its winding up (other than in connection with a
reconstruction or amalgamation which is on a solvent basis and does not
involve any Obligor or which is otherwise upon terms and within such
period as may previously have been approved in writing by the Majority
Banks); or
(b) An Obligor or any Principal Subsidiary passes any resolution for its
winding up other than a resolution previously approved in writing by the
Majority Banks (other than in connection with a reconstruction or
amalgamation which is on a solvent basis and does not involve any Obligor
or which is otherwise upon terms and within such period as may previously
have been approved in writing by the Majority Banks); or
(c) A petition for the winding up of an Obligor or any Principal Subsidiary
is presented to the court and either (i) such Obligor or such Principal
Subsidiary does not apply to the court within 7 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 21 days after such application for the refusal of such
petition; or
(d) An Obligor or any Principal Subsidiary becomes subject to a winding up
order.
20.10 Appointment of receivers and managers
(a) Any liquidator, trustee in bankruptcy, judicial custodian, compulsory
manager, receiver, administrative receiver, administrator or the like is
appointed in respect of an Obligor or any Principal Subsidiary or any
material part of its assets or undertaking; or
55
(b) the directors of an Obligor or any Principal Subsidiary request the
appointment of a liquidator, trustee in bankruptcy, judicial custodian,
compulsory manager, receiver, administrative receiver, administrator or
the like.
20.11 Creditors' process
Any attachment, sequestration, distress or execution affects any material
asset of an Obligor or any Principal Subsidiary and is not discharged
within 21 days.
20.12 Analogous proceedings
There occurs, in relation to an Obligor or any Principal Subsidiary, any
event anywhere which is analogous with any of those mentioned in Clauses
20.6 (Insolvency) to 20.9 (Winding up) (inclusive).
20.13 Unlawfulness
It is or becomes unlawful for any Obligor to perform any of its
obligations under the Transaction Documents unless, in the case of any
Guarantor, the provisions of Clause 20.14 apply and such Guarantor is
replaced in accordance with those provisions.
20.14 Guarantee
The guarantee of any Guarantor (other than the Company) under Clause 17:
(a) is not effective (unless replaced by a guarantee granted in
accordance with Clause 28.5 by either a Subsidiary or
Subsidiaries which can demonstrate equal or greater Profit
Before Net Interest (as defined in Clause 19.6(a)) and equal or
greater gross assets (in each case by reference to the most
recent annual or interim financial statements of the relevant
Subsidiary) or by another replacement Guarantor(s) acceptable
to the Majority Banks within 5 Business Days of such guarantee
becoming ineffective); or
(b) is alleged by any Obligor to be ineffective for any reason.
Where a Guarantor is replaced in accordance paragraph (a) above, it shall
cease to be a Guarantor for the purposes of this Agreement (including,
but not limited to, Clause 19.11) on the date the replacement Guarantor
becomes a Guarantor.
20.15 Ownership
Any Guarantor or Borrower (other than the Company) ceases to be (directly
or indirectly) a wholly owned Subsidiary of the Company other than
pursuant to a disposal in accordance with the terms of this Agreement.
20.16 Cessation of business
Any Obligor or Principal Subsidiary ceases, or threatens to cease, to
carry on all or a substantial part of its business other than by reason
of:
(a) the transfer of such business to an Obligor or from a Principal
Subsidiary which is not an Obligor to another Principal
Subsidiary which is not an Obligor;
56
(b) a disposal permitted by this Agreement; or
(c) a reconstruction or amalgamation which is on a solvent basis
and does not involve any Obligor or which is otherwise on terms
and within such period as may previously have been approved in
writing by the Majority Banks.
20.17 Material adverse effect
Any change occurs in the financial condition of the Group taken as a
whole which, in the reasonable opinion of the Majority Banks is
reasonably likely to have a material adverse effect.
20.18 Acceleration
On and at any time after the occurrence of an Event of Default while
such event is continuing the Agent may, and shall if so directed by
the Majority Banks, by notice to the Company:
(a) cancel the Total Commitments; and/or
(b) declare that each Borrower's obligations under Clause 8.3
(Payment of Bills) in respect of all outstanding Bills are
immediately due and payable, whereupon they shall become
immediately due and payable; and/or
(c) demand that all the Advances, 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
(d) demand that all the Advances be payable on demand, whereupon
they shall immediately become payable on demand.
21. THE AGENT AND THE ARRANGERS
21.1 Appointment and duties of the Agent
Each Finance Party (other than the Agent) irrevocably appoints the
Agent to act as its agent under and in connection with the Finance
Documents, and irrevocably authorises the Agent on its behalf to
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. The Agent shall have only those duties which are
expressly specified in this Agreement. Those duties are solely of a
mechanical and administrative nature.
21.2 Role of the Arrangers
Except as otherwise provided in this Agreement, no Arranger has any
obligations of any kind to any other Party under or in connection with
any Finance Document.
21.3 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
57
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.
21.4 Majority Banks' directions
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.
21.5 Delegation
The Agent may act under the Finance Documents through its personnel and
agents.
21.6 Responsibility for documentation
Neither the Agent nor any Arranger is responsible to any other 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.
21.7 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.
21.8 Exoneration
(a) Without limiting paragraph (b) below, the Agent will not be liable to any
other 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 negligence or
wilful misconduct) by that officer, employee or agent in relation to any
Finance Document.
58
21.9 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).
21.10 Credit approval and appraisal
Without affecting the responsibility of any Obligor 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 Obligor 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 Obligor and its related entities while
any amount is or may be outstanding under the Finance Documents
or any Commitment is in force.
21.11 Information
(a) The Agent shall promptly forward to the person concerned the original or
a copy of any document which is delivered to the Facility 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), 28.5
(Additional Borrowers) or 28.6 (Additional Guarantors) 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 Obligor or any related
entity of any Obligor whether coming into its possession or
that of any of its related entities before, on or after the
date of this Agreement; or
(ii) unless specifically requested to do so by a Bank in
accordance with this Agreement, to request any certificates
or other documents from any Obligor.
59
21.12 The Agent and the Arrangers individually
(a) If it is also a Bank, each of the Agent and the Arrangers 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 the Arrangers.
(b) Each of the Agent and Arrangers may:
(i) carry on any business with any Obligor or its related entities;
(ii) act as agent or trustee for, or in relation to any financing
involving, any Obligor 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.
21.13 Indemnities
(a) Without limiting the liability of any Borrower under the Finance
Documents, each Bank shall forthwith on demand indemnify the Agent for
its 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
negligence or wilful misconduct.
(b) A Bank's proportion of the liability or loss set out in paragraph (a)
above is the proportion which the Dollar Sterling Amount of its
Advance(s) and Bills (if any) bears to the Original Dollar Amount of all
Advances or Bills outstanding on the date of the demand. If, however, no
Advances or Bills are 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.
(c) The Company shall forthwith on demand reimburse each Bank for any payment
made by it under paragraph (a) above except to the extent it arises out
of the Bank's negligence or wilful misconduct.
21.14 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.
21.15 Resignation of Agent
(a) Notwithstanding its irrevocable appointment, the Agent may resign by
giving notice to the Banks and the Company, in which case the Agent may
forthwith appoint one of its Affiliates as successor Agent or, failing
that, the Majority Banks may, with the approval of the
60
Company such approval not to be unreasonably withheld or delayed, 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 and has been
approved by the Company such approval not to be unreasonably withheld or
delayed, the retiring Agent may, following consultation with the Company,
appoint a successor Agent.
(c) The resignation of the retiring 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 and provided
the successor Agent has, if required under paragraph (a) above, been
approved by the Company. On giving the notification and receiving such
approval, the successor Agent will succeed to the position of the
retiring 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 21 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.
21.16 Banks
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 notice from the Bank to the contrary by not less than five
Business Days prior to the relevant payment.
21.17 Chinese Wall
In acting as Agent or Arranger, the agency and syndications division of
each of the Agent and Arranger shall be treated as a separate entity from
its other divisions and departments. Any information acquired by the
Agent or any Arranger otherwise than in the capacity of Agent or Arranger
through its agency and syndications division may be treated as
confidential by the Agent or Arranger and shall not be deemed to be
information possessed by the Agent or Arranger in their capacity as such.
22. FEES
22.1 Commitment fee
(a) The Company shall pay to the Agent for distribution to each Bank pro rata
to, as the case may be, the proportion its Tranche A Commitment bears to
the Tranche A Total Commitments or its Tranche B Commitment bears to the
Tranche B Total Commitments or its Tranche C Commitment bears to the
Tranche C Total Commitment from time to time a commitment fee at the rate
of:
(i) 0.125 per cent. per annum on any undrawn, uncancelled amount
of the Tranche A Total Commitments on each day until the
last day of the Tranche A Commitment Period;
61
(ii) 0.30 per cent. per annum on any undrawn, uncancelled amount
of the Tranche B Total Commitments on each day; and
(iii) 0.125 per cent. per annum on any undrawn, uncancelled amount
of the Tranche C Total Commitments on each day until the
Tranche C Term Date.
(b) Commitment fee is calculated and accrues on a daily basis and is
payable quarterly in arrear with the first payment due three months
after the date of this Agreement. Accrued commitment fee is also
payable to the Agent for the relevant Bank(s) on the cancelled amount
of its Tranche A Commitment, Tranche B Commitment or Tranche C
Commitment at the time the cancellation takes effect.
22.2 Agent's fee
The Company shall pay to the Agent for its own account an agency fee in
the amounts and on the dates agreed in the relevant Fee Letter.
22.3 Arrangement fee
The Company shall pay to the Arrangers an arrangement fee in the amount
and on the dates specified in the relevant Fee Letter.
22.4 VAT
Any fee referred to in this Clause 22 or Clause 23 (Expenses) is
exclusive of any value added or similar tax. If any value added tax is
so chargeable, it shall be paid by the Company at the same time as it
pays the relevant fee subject (where applicable) to it having received
a valid tax invoice.
23. EXPENSES
23.1 Initial and special costs
The Company shall within 5 Business Days of demand pay the Agent and
the Arrangers the amount of all reasonable out-of-pocket costs and
expenses (including legal fees) reasonably incurred by either 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;
(b) any amendment, waiver, consent or suspension of rights (or any
proposal for any of the foregoing) requested by or on behalf
of a Borrower and relating to a Transaction Document or a
document referred to in any Transaction Document;
(c) the release of any Guarantor under Clause 17.10 (Release of
Guarantor); and
(d) any other matter, not of an ordinary administrative nature,
arising out of or in connection with a Finance Document.
62
23.2 Enforcement costs
The Company shall forthwith on demand pay to each Finance Party the
amount of all costs and expenses (including legal fees) properly
incurred by it:
(a) in connection with the enforcement of, or the preservation of
any rights under, any Finance Document; or
(b) in investigating any possible Default of which an Obligor has
given notice or the Majority Banks have reasonable grounds for
believing has occurred.
24. STAMP DUTIES
The Company shall pay and forthwith on demand indemnify each Finance
Party against any liability it incurs in respect of any stamp,
registration and similar tax which is or becomes payable in connection
with the entry into, performance or enforcement of any Finance Document
other than a Novation Certificate.
25. INDEMNITIES
25.1 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, the Borrower concerned 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 the Finance Party concerned 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.
25.2 Other indemnities
The Company shall forthwith on demand indemnify each Finance Party
against any loss or liability which that Finance Party incurs as a
consequence of:
(a) the occurrence of any Event of Default;
(b) the operation of Clause 20.18 (Acceleration) or Clause 31 (Pro
Rata Sharing);
63
(c) any payment of principal or an overdue amount being received
from any source otherwise than, in the case of Tranche A
Advances or Term-out Advances, on the last day of applicable
Interest Periods and, in the case of Tranche B Advances or
Tranche C Advances, on its Maturity Date (and, for the
purposes of this paragraph (c), the Maturity Date of an
overdue amount is the last day of each Designated Term (as
defined in Clause 10.4 (Default interest))); or
(d) (other than by reason of negligence or default by a Finance
Party) a Utilisation not being effected after the Borrower has
delivered a Request for that Utilisation.
The Company's liability in each case includes any loss of margin or
other 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 Advance or Xxxx. However, the Company
is only required to indemnify a Finance Party against loss of Margin
for the unexpired portion of the Interest Period or Term in which the
relevant amount is received, after taking into account the amount that
Finance Party certifies it was able to earn by redeploying the amount
received by it for the same period in the ordinary course of business.
26. EVIDENCE AND CALCULATIONS
26.1 Accounts
Accounts maintained by a Finance Party in connection with this
Agreement are prima facie evidence of the matters to which they relate.
26.2 Certificates and determinations
Any certification or determination by a Finance Party of a rate or
amount under this Agreement is, in the absence of manifest error,
conclusive evidence of the matters to which it relates.
26.3 Calculations
Interest (including any applicable Mandatory Cost) and the fee payable
under Clause 22.1 (Commitment fee) accrue from day to day and are
calculated on the basis of the actual number of days elapsed and a year
of 360 days, or, in the case of interest payable on an amount
denominated in Sterling, 365 days (or, in any case where market
practice differs, in accordance with market practice). Acceptance
commission is calculated on the basis of the number of days in the
relevant Term and a year of 365 days.
27. AMENDMENTS AND WAIVERS
27.1 Procedure
(a) Subject to Clause 27.2 (Exceptions), any term of the Finance Documents
may be amended or waived with the agreement of the Company, the
Majority Banks and the Agent. The Agent may effect, on behalf of the
Majority Banks, an amendment to which they have agreed.
(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.
64
27.2 Exceptions
An amendment or waiver which relates to:
(a) the definition of "Majority Banks" in Clause 1.1;
(b) an extension of the date for, or a decrease in an amount or a
change in the currency of, any payment under the Finance
Documents;
(c) an increase in a Bank's Commitment;
(d) the incorporation of additional borrowers and/or drawers or a
change in the guarantee of the Guarantors otherwise than in
accordance with Clauses 17.10 (Release of Guarantor), 20.14
(Guarantee) and 28.5 (Additional Borrowers);
(e) a term of a Finance Document which expressly requires the
consent of each Bank; or
(f) Clause 31 (Pro Rata Sharing) or this Clause 27 (Amendments
and Waivers),
may not be effected without the consent of each Bank.
27.3 Waivers and remedies cumulative
The rights of each Party under the Finance Documents:
(i) may be exercised as often as necessary;
(ii) are cumulative and not exclusive of its rights under the
general law; and
(iii) 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.
28. CHANGES TO THE PARTIES
28.1 Transfers by Obligors
No Obligor may assign, transfer, novate or dispose of any of, or any
interest in, its rights and/or obligations under this Agreement.
28.2 Transfers by Banks
(a) A Bank (the "Existing Bank") may at any time assign, transfer or novate
any of its rights and/or obligations under this Agreement to another
person (the "New Bank") provided that:
(i) in the case of a partial assignment, transfer or novation of
rights and/or obligations, a minimum amount of U.S.$7,500,000
in aggregate (unless to an Affiliate or to a Bank or the Agent
and the Company agree otherwise) must be assigned, transferred
or novated; and
(ii) after the Syndication Period, the prior written consent of the
Company is required for any such assignment, transfer or
novation which is not to another Bank or to an Affiliate of
any Bank (provided that the Company may not unreasonably
withhold or
65
delay its consent and will be deemed to have consented to
any such assignment, transfer or novation if it has not
been expressly refused in writing by the Company within
10 Business Days of a written request to the Company for
such consent); and
(iii) except in the case of an assignment, transfer or novation to
an Affiliate, a rateable proportion of each of Tranche A,
Tranche B and Tranche C must be assigned, transferred or
novated (unless the Agent agrees otherwise).
(b) A transfer of obligations will be effective only if either:
(i) the obligations are novated in accordance with Clause 28.3
(Procedure for novations); or
(ii) the New Bank gives notice to the Company and confirms to the
Agent and the Borrowers' Agent 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.
(c) After the Syndication Period, a Bank may only sub-contract an
obligation hereunder with the consent of the Company (such consent not
to be unreasonably withheld or delayed).
(d) On each occasion an Existing Bank assigns, transfers or novates any of
its rights and/or obligations under this 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 U.S.$1,000.
(e) 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 connection with any Finance Document.
(f) 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 Obligor 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 Obligor and its related entities
while any amount is or may be outstanding under this Agreement
or any Commitment is in force.
(g) 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
66
(ii) support any losses incurred by the New Bank by reason of the
non-performance by any Obligor of its obligations under this
Agreement or otherwise.
(h) 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 it under this
Agreement and its Commitment has been cancelled or reduced to nil.
28.3 Procedure for novations
(a) A novation is effected if:
(i) the Existing Bank and the New Bank deliver to the Agent a duly
completed certificate, substantially in the form of Part I of
Schedule 6 (a "Novation Certificate"); and
(ii) the Agent executes it.
(b) Each Party (other than the Existing Bank and the New Bank) irrevocably
authorises 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:
(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 by the Agent
or, if later, the date specified in the Novation Certificate.
28.4 Additional Borrowers
(a) If the Company wishes one of its wholly owed Subsidiaries to become an
Additional Borrower, then it may (if all the Banks have approved the
identity of the Additional Borrower in writing) deliver to the Agent
the documents listed in Part III of Schedule 2, in each case in form
and substance satisfactory to the Agent.
(b) On delivery of a Borrower Accession Agreement, executed by the relevant
Subsidiary and the Company, the Subsidiary concerned will become an
Additional Borrower. However, it may not utilise either of the
Facilities until the Agent confirms to the other Finance Parties and
the Company that it has received all the documents referred to in
paragraph (a) above in form and substance satisfactory to it. The Agent
will promptly give that confirmation upon such receipt.
67
(c) Delivery of a Borrower Accession Agreement, executed by the Subsidiary
and the Company, constitutes confirmation by that Subsidiary and the
Company that the representations and warranties set out in Clause 18
(Representations and Warranties) and to be made by them on the date of
the Borrower Accession Agreement are correct, as if made with reference
to the facts and circumstances then existing.
28.5 Additional Guarantors
(a) (i) Subject to paragraph (b) below, a Subsidiary of the
Company may become an Additional Guarantor by delivering to
the Agent a Guarantor Accession Agreement, duly executed by
that company.
(ii) Upon execution and delivery of a Guarantor Accession
Agreement, the relevant Subsidiary will become an Additional
Guarantor.
(iii) The Company shall procure that, at the same time as a
Guarantor Accession Agreement is delivered to the Agent, there
is also delivered to the Agent all those other documents
listed in Part IV of Schedule 2, in each case in form and
substance satisfactory to the Agent.
(b) The execution of a Guarantor Accession Agreement constitutes
confirmation by the Subsidiary concerned that the representations and
warranties set out in Clause 18 (Representations and Warranties) to be
made by it on the date of the Guarantor Accession Agreement are
correct, as if made with reference to the facts and circumstances then
existing.
28.6 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 one of the Banks, the Agent
shall (in consultation with the Company) appoint another Bank or an
Affiliate of a Bank to replace that Reference Bank.
28.7 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.
29. DISCLOSURE OF INFORMATION
A Bank may disclose to one of its Affiliates or any person with whom it
is proposing to enter, or has entered into, any kind of transfer,
participation or other agreement in relation to this Agreement:
(a) a copy of any Finance Document; and
(b) any information which that Bank has acquired under or in
connection with any Finance Document,
Provided that a Bank shall not disclose any such information to a
person other than one of its Affiliates unless that person has provided
that Bank with a confidentiality undertaking.
68
30. SET-OFF
A Finance Party may set off any matured obligation owed by an Obligor
under this Agreement (to the extent beneficially owned by that Finance
Party) against any obligation (whether or not matured) owed by that
Finance Party to that Obligor, regardless of the place of payment,
booking branch or currency of either obligation. If the obligations are
in different currencies, the 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. If either obligation is unliquidated or
unascertained, the Finance Party may set off in an amount estimated by
it in good faith to be the amount of that obligation.
31. PRO RATA SHARING
31.1 Redistribution
If any amount owing by an Obligor under this Agreement 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 12 (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 12 (Payments);
(c) subject to Clause 31.3 (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 12 (Payments)
and shall pay the redistribution to the Finance Parties (other
than the recovering Finance Party) in accordance with Clause
12.7 (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 Obligor will owe the
recovering Finance Party a debt which is equal to the
redistribution, immediately payable and of the type originally
discharged.
31.2 Reversal of redistribution
If under Clause 31.1 (Redistribution):
(a) a recovering Finance Party must subsequently return a
recovery, or an amount measured by reference to a
recovery, to an Obligor; 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. Thereupon the subrogation in Clause 31.1(e) will
operate in reverse to the extent of the reimbursement.
69
31.3 Exception
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
Obligor concerned in the amount of the redistribution pursuant to
Clause 31.1(e) (Redistribution).
32. SEVERABILITY
If a provision of any Finance Document is or becomes illegal, invalid
or unenforceable in any jurisdiction, that shall not affect:
(a) the legality, validity or enforceability in that jurisdiction
of any other provision of the Finance Documents; or
(b) the legality, validity or enforceability in other
jurisdictions of that or any other provision of the Finance
Documents.
33. 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.
34. NOTICES
34.1 Giving of notices
All notices or other communications under or in connection with this
Agreement shall be given in writing or by facsimile. Any such notice
will be deemed to be given as follows:
(a) if in writing, when delivered; and
(b) if by facsimile, when received.
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.
Facsimile Requests are to be confirmed by the relevant Borrower in
writing (but may be relied upon by the Agent and the Banks irrespective
of receipt of such confirmation).
34.2 Addresses for notices
(a) The address and facsimile number of each Party (other than the Agent)
for all notices under or in connection with this Agreement are:
(i) that 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 and facsimile numbers of the Agent are HSBC Loan
Syndication, Execution and Agency, Vintners Place, 00 Xxxxx Xxxxxx
Xxxxxx, Xxxxxx XX0X 0XX, Facsimile No. 0171
70
336 9372/9293 or such other as the Agent may notify to the other
Parties by not less than five Business Days' notice.
(c) The Agent shall, promptly upon request from any Party, give to that
Party the address or facsimile number of any other Party applicable at
the time for the purposes of this Clause.
35. LANGUAGE
(a) Any notice given under or in connection with any Finance Document
shall be in English.
(b) All other documents provided under or in connection with any Finance
Document shall be:
(i) in English; or
(ii) if not in English, accompanied by a certified English
translation and, in this case, the English translation shall
prevail unless the document is a statutory or other official
document.
36. JURISDICTION
36.1 Submission
(a) For the benefit of each Finance Party, each Obligor agrees that the
courts of England have jurisdiction to settle any disputes in
connection with any Finance Document and accordingly submits to the
jurisdiction of the English courts.
(b) Without prejudice to paragraph (a) above, each Obligor agrees that any
New York State court or Federal court sitting in New York City has
jurisdiction to settle any disputes in connection with any Finance
Document and accordingly submits to the jurisdiction of those courts.
36.2 Service of process
Without prejudice to any other mode of service, each Obligor:
(a) irrevocably appoints:
(i) (other than an Obligor incorporated in England and
Wales) the Company as its agent for service of
process relating to any proceedings before the
English courts in connection with any Finance
Document (and the Company irrevocably accepts this
appointment); and
(ii) Meggitt USA, Inc. as its agent for service of process
in relation to any proceedings before any courts in
the State of New York in connection with any Finance
Document (and Meggitt USA, Inc. irrevocably accepts
this appointment);
(b) agrees that failure by a process agent to notify the Obligor
of the process will not invalidate the proceedings concerned;
(c) consents to the service of process relating to any such
proceedings by prepaid posting of a copy of the process to its
address for the time being applying under Clause 34.2
(Addresses for notices); and
71
(d) agrees that if the appointment of any person mentioned in
paragraph (a) above ceases to be effective, the relevant
Obligor shall immediately appoint a further person in England
or New York, as appropriate, to accept service of process on
its behalf in England or New York, as appropriate, and,
failing such appointment within 15 days, the Agent is entitled
to appoint such a person by notice to the Company.
36.3 Forum convenience and enforcement abroad
Each Obligor:
(a) waives objection to the English and New York courts on grounds
of inconvenient forum or otherwise as regards proceedings in
connection with a Finance Document; and
(b) agrees that a judgment or order of an English and New York
court in connection with a Finance Document is conclusive and
binding on it and may be enforced against it in the courts of
any other jurisdiction.
36.4 Non-exclusivity
Nothing in this Clause 36 limits the right of a Finance Party to bring
proceedings against an Obligor in connection with any Finance Document:
(a) in any other court of competent jurisdiction; or
(b) concurrently in more than one jurisdiction.
36.5 WAIVER OF RIGHT TO TRIAL BY JURY
EACH OF THE PARTIES IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED
BY APPLICABLE LAW, ANY RIGHT TO TRIAL BY JURY (WHETHER IN NEW YORK OR
ELSEWHERE) OF ANY CLAIM, DEMAND OR CAUSE OF ACTION RELATING IN ANY WAY
TO THIS AGREEMENT, WHETHER SOUNDING IN CONTRACT OR TORT OR OTHERWISE,
AND AGREES THAT ANY PARTY MAY FILE A COPY OF THIS SECTION WITH ANY
COURT AS EVIDENCE OF THE WAIVER OF ITS JURY TRIAL RIGHTS.
37. 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.
72
SCHEDULE 1
PART I
ORIGINAL GUARANTORS
Meggitt USA, Inc., incorporated in Delaware, U.S.A. and registered on 8th
December, 1980 with Federal Employer Identification Number 00-0000000.
73
PART II
BANKS AND COMMITMENTS
Column 1 Column 2 Column 3
Bank Tranche A Tranche B Tranche C
Commitments Commitments Commitments
U.S.$ U.S.$ U.S.$
Barclays Bank PLC 125,000,000 90,000,000 50,000,000
HSBC Investment Bank plc 125,000,000 90,000,000 50,000,000
----------- ----------- -----------
Total 250,000,000 180,000,000 100,000,000
=========== =========== ===========
74
SCHEDULE 2
CONDITIONS PRECEDENT
PART I
TO BE DELIVERED BEFORE THE FIRST DRAWING
1. A copy of the memorandum and articles of association and certificate of
incorporation (or equivalent) of the Company, each Original Guarantor
and Bidco.
2. (a) A copy of a resolution of the board of directors (or
equivalent) of the Company, each Original Guarantor and Bidco:
(i) approving the terms of, and the transactions
contemplated by the Transaction Documents to which it
is party and resolving that it execute such
Transaction Documents;
(ii) authorising a specified person or persons to execute
such Transaction Document on its behalf; and
(iii) (in the case of the Company) authorising a specified
person or persons, on its behalf, to sign and endorse
Bills and to sign and/or despatch all other documents
and notices (including Requests) to be signed and/or
despatched by it under or in connection with this
Agreement;
(b) a specimen of the signature of each person (an
"Authorised Signatory") authorised by the
resolutions referred to in paragraph (a) above; and
(c) a certificate from a director of the Company certifying that
the borrowing of the Total Commitments by the Borrowers in
full will not cause any borrowing limit binding on any Obligor
to be exceeded; and
(d) a certificate of an Authorised Signatory of the Company
certifying that each copy document specified in Part I of this
Schedule 2 is correct, complete and in full force and effect
as at a date no earlier than the date of this Agreement.
3. (a) A copy of the circular sent to shareholders in the Company
in relation to the Offer, the Merger and the CULS;
(b) a certified copy of a shareholders' resolution of the Company
approving the Offer, the Merger and the CULS.
4. Evidence that the Company has received underwriting commitments on
terms acceptable to the Arrangers which will generate net proceeds of
not less than 'L' 70,000,000 in respect of the CULS.
5. Certified copies of:
(a) the Press Release;
(b) the Offer Documents; and
75
(c) the Merger Agreement.
6. A certificate from a director of the Company certifying that the
Unconditional Date has occurred.
7. The Original Group Accounts.
8. Evidence of cancellation of all commitments under the Company's
'L' 115,000,000 (in aggregate) bilateral facilities with each of
Midland Bank plc, Den Danske Bank Aktieselskab, Barclays Bank PLC, N.M.
Rothschild and Sons Limited, The Chase Manhattan Bank and Banque
Paribas, together with an irrevocable direction from the Company to the
Agent to repay all outstanding amounts under those facilities out of
the proceeds of the first Utilisation.
9. A legal opinion addressed to the Finance Parties from Xxxxx & Xxxxx in
relation to English, New York and Delaware law.
76
SCHEDULE 2
CONDITIONS PRECEDENT
PART II
TO BE DELIVERED BEFORE MERGER
COMPLETION ADVANCES
The conditions referred to in Clause 4.2(b) are that the Agent has received a
certificate from a director of the Company:
(a) certifying that completion of the Merger has occurred in
accordance with the Merger Agreement; and
(b) specifying which (if any) of the conditions to the Merger
specified in the Merger Agreement has been amended, varied or
waived.
77
SCHEDULE 2
CONDITIONS PRECEDENT
PART III
TO BE DELIVERED BY AN ADDITIONAL BORROWER
1. A Borrower Accession Agreement, duly executed by the Additional
Borrower and the Company;
2. A copy of the memorandum and articles of association and certificate of
incorporation (or equivalent) of the Additional Borrower;
3. A copy of a resolution of the board of directors (or equivalent) of the
Additional Borrower:
(i) approving the terms of, and the transactions contemplated by,
the Borrower Accession Agreement and resolving that it execute
the Borrower Accession Agreement;
(ii) authorising a specified person or persons to execute the
Borrower Accession Agreement on its behalf; and
(iii) authorising a specified person or persons, on its behalf, to
sign and endorse Bills and to sign and/or despatch all other
documents and notices (including Requests) to be signed and/or
despatched by it under or in connection with this Agreement;
4. A certificate from a director of the Additional Borrower that the
borrowing by it of the Total Commitments in full would not cause any
borrowing limit binding on it to be breached.
5. A copy of any other authorisation or other document, opinion or
assurance which the Agent reasonably considers to be necessary in
connection with the entry into and performance of, and the transactions
contemplated by, the Borrower Accession Agreement or for the validity
and enforceability of any Finance Document;
6. A specimen of the signature of each person authorised by the resolution
referred to in paragraph 3 above;
7. The latest audited accounts of the Additional Borrower (if any);
8. A legal opinion of Xxxxx & Overy, legal advisers to the Agent and, if
applicable, other lawyers approved by the Agent in the place of
incorporation of the Additional Borrower, addressed to the Finance
Parties; and
9. A certificate of an Authorised Signatory of the Additional Borrower
certifying that each copy document specified in Part III of this
Schedule 2 is correct, complete and in full force and effect as at a
date no earlier than the date of the Borrower Accession Agreement.
78
PART IV
TO BE DELIVERED BY AN ADDITIONAL GUARANTOR
1. A Guarantor Accession Agreement, duly executed under seal by the
Additional Guarantor.
2. A copy of the memorandum and articles of association and certificate of
incorporation (or other equivalent constitutional documents) of the
Additional Guarantor.
3. A copy of a resolution of the board of directors (or equivalent) of the
Additional Guarantor:
(i) approving the terms of, and the transactions contemplated by,
the Guarantor Accession Agreement and resolving that it
execute the Guarantor Accession Agreement as a deed;
(ii) authorising a specified person or persons to execute the
Guarantor Accession Agreement as a deed; and
(iii) authorising a specified person or persons, on its behalf, to
sign and/or despatch all documents to be signed and/or
despatched by it under or in connection with this Agreement.
4. If the lawyers referred to in paragraph 10 below advise it to be
necessary or desirable, a copy of a resolution, signed by all the
holders of the issued or allotted shares in the Additional Guarantor,
approving the terms of, and the transactions contemplated by, the
Guarantor Accession Agreement.
5. A copy of a resolution of the Board of Directors (or equivalent) of
each corporate shareholder in the Additional Guarantor:
(i) approving the terms of the resolution referred to in paragraph
4 above (if any); and
(ii) authorising a specified person or persons to sign the
resolution on its behalf.
6. A certificate of a director of the Additional Guarantor certifying that
the borrowing of the Total Commitments in full by the Borrowers would
not cause any borrowing limit binding on it to be exceeded.
7. A copy of any other authorisation or other document, opinion or
assurance which the Agent considers to be necessary or desirable in
connection with the entry into and performance of, and the transactions
contemplated by, the Guarantor Accession Agreement or for the validity
and enforceability of any Finance Document.
8. A specimen of the signature of each person authorised by the
resolutions referred to in paragraphs 3 and 5 above.
9. A copy of the latest audited accounts of the Additional Guarantor
(if any).
10. A legal opinion of Xxxxx & Xxxxx, legal advisers to the Agent, and, if
applicable, other lawyers approved by the Agent in the place of
incorporation of the Additional Guarantor addressed to the Finance
Parties.
79
11. A certificate of an Authorised Signatory of the Additional Guarantor
certifying that each copy document specified in Part IV of this
Schedule 2 is correct, complete and in full force and effect as at a
date no earlier than the date of the Guarantor Accession Agreement.
80
SCHEDULE 3
CALCULATION OF THE MANDATORY COST
(a) The Mandatory Cost for an Advance 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 an Advance denominated in Sterling:
BY + S(Y-Z) + F x 0.01% per annum = Mandatory Cost
----------------------
100-(B + S)
in relation to any other Advance:
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 but where for this
purpose, the figure in paragraph 2.02b and 2.03b will be
deemed to be zero expressed in pounds per 'L' 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
81
(2) on and after 31st March, 1999, any regulations
governing the payment of fees for banking
supervision.
(iv) "relevant period" in relation to each Term or Interest Period,
means:
(A) if it is three months or less, that Term or Interest
Period; or
(B) if it is more than three months, three months.
(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 Term or 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. The manner of
calculation so notified by the Agent shall, in the absence of manifest
error, be binding on all the Parties.
82
SCHEDULE 4
FORM OF REQUEST
To: [AGENT]
From: [BORROWER]
Date: [ ]
Meggitt PLC - U.S.$530,000,000 Term and Revolving Credit Agreement
dated
[ ], 1999
1. We wish to utilise Tranche A* and/or*/Tranche B* and/or */Tranche C by
way of Advances* and/or*/Bills* as follows:
(a) Utilisation Date: Tranche A: [ ]*
Tranche B: [ ]*
Tranche C: [ ]*
(b) Requested Amount: Tranche A: [ ]*
(including currency): Tranche B: [ ]*
Tranche C: [ ]*
(c) Interest Period*: Tranche A: [ ]* /Term-out
Advance [ ]*
Term*/alternative Term:** Tranche B: [ ]*
Tranche C: [ ]*
(d) Xxxxxxxx (for Bills):
(e) Payment Instructions: Tranche A: [ ]*
Tranche B: [ ]*
Tranche C: [ ]*
(f) Initial Interest Period
(for Term-out Advances only)*
(g) Maturity Date
(for Term-out Advances only)* Tranche C [ ]*
We confirm that each condition specified in Clause 4.3 (Further
conditions precedent) is satisfied on the date of this Request and this
Utilisation would not cause any borrowing limit binding on us or any
other Obligor to be exceeded.
By:
[BORROWER]
Authorised Signatory
--------------------
* Delete as appropriate.
** Complete only if the Request is for Tranche B Advances and the requested
Term is of an optional duration.
83
SCHEDULE 5
FORM OF XXXX
Face of Xxxx
No. for 'L'..............
....................19....
To
On.................19... pay against this Xxxx of Exchange to our order the
sum of ............................... for value received against [ ].
Accepted by:
For and on behalf of For and on behalf of
[ACCEPTING BANK] [BORROWER]
..................... ....................
Authorised Signatory Authorised Signatory
Reverse of Xxxx
For and on behalf of
[BORROWER]
.................... .....................
Authorised Signatory Authorised Signatory
84
SCHEDULE 6
FORMS OF ACCESSION DOCUMENTS
PART I
NOVATION CERTIFICATE
To: [AGENT]
From: [THE EXISTING BANK] and [THE NEW BANK] Date: [ ]
Meggitt plcU.S.$530,000,000 Term and Revolving Credit Agreement dated
[ ], 1999
We refer to Clause 28.4 (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 rights
and obligations referred to in the Schedule in accordance with Clause
28.4 (Procedure for novations).
2. The specified date for the purposes of Clause 28.4(c) is [date of
novation].
3. The Facility Office and address for notices of the New Bank for the
purposes of Clause 34.2 (Addresses for notices) are set out in the
Schedule.
4. This Novation Certificate is governed by English law.
85
THE SCHEDULE
Rights and obligations to be novated
[Details of the rights and obligations of the Existing Bank to be novated].
[New Bank]
[Facility Office Address for notices]
[Existing Bank] [New Bank] [AGENT]
By: By: By:
Date: Date: Date:
86
SCHEDULE 6
PART II
BORROWER ACCESSION AGREEMENT
To: [AGENT]
From: [PROPOSED BORROWER] and Meggitt plc
[Date]
Meggitt plc - U.S.$530,000,000 Term and Revolving Credit Agreement
dated [ ], 1999 (the "Credit Agreement")
We refer to Clause 28.4 (Additional Borrowers).
[Name of company] of [Registered Office] (Registered no. [ ]) (the "Proposed
Borrower") agrees to become an Additional Borrower and to be bound by the terms
of the Credit Agreement as an Additional Borrower in accordance with Clause 28.4
(Additional Borrowers).
The address for notices of the Proposed Borrower for the purposes of Clause 34.2
(Addresses for notices) is:
[
]
This Agreement is governed by English law.
By:
[PROPOSED BORROWER]
Authorised Signatory
By:
Meggitt plc
Authorised Signatory
87
PART III
GUARANTOR ACCESSION AGREEMENT
To: [AGENT] as Agent
From: [PROPOSED GUARANTOR]
Date: [ ]
Meggitt plc - U.S.$530,000,000 Term and Revolving Credit Agreement dated
[ ], 1999 (the "Credit Agreement")
We refer to Clause 26.5 (Additional Guarantors).
We, [name of company] of [Registered Office] (Registered no. [ ]) agree
to become an Additional Guarantor and to be bound by the terms of the Credit
Agreement as an Additional Guarantor in accordance with Clause 28.5 (Additional
Guarantors).
Our address for notices for the purposes of Clause 34.2 (Addresses for notices)
is:
[
]
This Deed is governed by English law.
Executed as a deed by ) Director
[PROPOSED GUARANTOR] )
acting by ) Director/Secretary
and )
88
SCHEDULE 7
TIMETABLES
In this Schedule 7:
D-[x] = x Business Days before the relevant Utilisation Date
A = Agent
B = Bank
CLAUSE 5 - TRANCHE A ADVANCES OR TERM-OUT ADVANCES
Clause Event Time
5.1 A receives Request (or D 8.30 a.m. (in respect
selection notice for of Sterling)
Interest Period) D-3 3.00 p.m. (in
respect of other
Currencies)
D-1 9.00 a.m. (in
respect of the first
Interest Period of an
Offer Closing Advance)
5.6 A notifies B's of As soon as practicable
details of Request (or
selection notice for
Interest Period) and, in
the case of a Request,
the amount of each B's
Advance
CLAUSE 5 - TRANCHE B ADVANCES OR TRANCHE C ADVANCES
Clause Event Times
5.1 A receives Request D 8.30 a.m. (in respect
of Sterling)
D-3 3.00 p.m. (in
respect of other
Currencies)
D-1 9.00 a.m. (in
respect of an Offer
Closing Advance)
5.5 A notifies B's of details As soon as practicable
of Request and
89
the amount
of each B's Advance
90
CLAUSE 6 - BILLS
Clause Event Time
6.1 A Receives Request D-1 12 noon
6.4 A notifies B's of details of D-1 3 p.m.
Request and Bills to be
accepted by each B
7.1(a) Borrower delivers Bills to A D-1 4 p.m.
(unless 7.1(c) applies)
6.5(a) B notifies A it does not wish D-1 5 p.m.
to accept Bills
6.6(a) A delivers Bills to B's D-11.00 a.m.
6.6(c) A notifies B's of EBDR As soon as practicable.
91
SIGNATORIES
Company
MEGGITT plc
By: XXXXX XXXXXXX
Original Guarantors
MEGGITT USA, INC.
By: XXXXX XXXXXXX
Arrangers
BARCLAYS CAPITAL
By: XXXX XXXXXX
HSBC INVESTMENT BANK plc
By: XXXX XXXXX
Agent
HSBC INVESTMENT BANK plc
By: XXXX XXXXX
Banks
BARCLAYS BANK PLC
By: XXXX XXXXXX
HSBC INVESTMENT BANK plc
By: XXXX XXXXX
