Exhibit 10.14
EXPERT MASTER HOLDINGS LIMITED
AS "CHARGOR"
EASTAR GROUP HOLDINGS LIMITED
AS THE "COMPANY"
THE HONGKONG AND SHANGHAI
BANKING CORPORATION LIMITED
AS THE "SECURITY TRUSTEE"
THE HONGKONG AND SHANGHAI
BANKING CORPORATION LIMITED
AS THE "BOND TRUSTEE"
AND
THE HONGKONG AND SHANGHAI
BANKING CORPORATION LIMITED
AS THE "NOTE TRUSTEE"
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FIRST PRIORITY SHARE MORTGAGE
IN RESPECT OF SHARES OF
EASTAR GROUP HOLDINGS LIMITED
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TABLE OF CONTENTS
CLAUSE PAGE
1. INTERPRETATION.......................................................... 1
2. CHARGOR'S REPRESENTATIONS AND WARRANTIES................................ 3
3. SECURITY................................................................ 6
4. DEALINGS WITH CHARGED PROPERTY.......................................... 9
5. PRESERVATION OF SECURITY................................................ 10
6. ENFORCEMENT OF SECURITY................................................. 13
7. FURTHER ASSURANCES...................................................... 14
8. INDEMNITIES............................................................. 21
9. SUBSEQUENT INTERESTS AND ACCOUNTS....................................... 22
10. POWER OF ATTORNEY....................................................... 22
11. EXPENSES................................................................ 23
12. NOTICES................................................................. 23
13. ASSIGNMENTS............................................................. 24
14. MISCELLANEOUS........................................................... 24
15. LAW AND JURISDICTION.................................................... 26
SCHEDULE 1 FORM OF SHARE TRANSFER CERTIFICATE................................ 27
SCHEDULE 2 SHAREHOLDERS LETTER OF AUTHORITY.................................. 28
SCHEDULE 3 IRREVOCABLE APPOINTMENT OF ATTORNEY-IN-FACT....................... 32
SCHEDULE 4................................................................... 33
PART I FORM OF LETTER OF RESIGNATION AND RELEASE..............................33
PART II FORM OF LETTER OF AUTHORISATION...................................... 34
SCHEDULE 5 FORM OF UNDERTAKING TO REGISTER TRANSFERS......................... 35
THIS SHARE MORTGAGE is made on 1 December 2006 BETWEEN:
(1) Expert Master Holdings Limited (the "CHARGOR");
(2) Eastar Group Holdings Limited, an exempted company incorporated under the
laws of the Cayman Islands with company number CT-177618 (the "COMPANY");
(3) The Hongkong and Shanghai Banking Corporation Limited as security trustee
for the Bond Trustee and the Note Trustee (the "SECURITY TRUSTEE" which
expression shall include any person for the time being appointed as
Security Trustee for the purpose of, and in accordance with, the Bonds and
the Notes);
(4) The Hongkong and Shanghai Banking Corporation Limited as trustee for the
holders of the Bonds (the "BOND TRUSTEE"); and
(5) The Hongkong and Shanghai Banking Corporation Limited as trustee for the
holders of the Notes (the "NOTE TRUSTEE").
WHEREAS:
(A) The Chargor has, on or about the date hereof, issued US$20,000,000 6.00
per cent. secured exchangeable bonds due 2009 (the "BONDS") and
US$15,000,000 11.75 per cent. secured notes due 2007 (the "NOTES").
(B) The Chargor holds legal and beneficial title to 69.4 per cent. of the
entire issued capital of the Company, namely 1,388 fully paid shares each
of HK$0.01 par value (the "SHARES").
(C) As security for the Secured Obligations (as defined below) the Chargor has
agreed to charge in favour of the Security Trustee as a first priority
fixed charge all legal and beneficial title and interest in and to the
Shares.
NOW THIS SHARE MORTGAGE WITNESSETH as follows:
1. INTERPRETATION
1.1 In this Share Mortgage, unless the context otherwise requires, the
following words and expressions shall have the following meanings:
"AFFILIATE" of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified. Person;
"BOND ACCOUNT BANK AGREEMENT" means the agreement dated 1 December 2006
between the Chargor and the Bond Trustee;
"BONDHOLDERS" has the meaning given in the Bond Trust Deed;
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"BOND SUBSCRIPTION AGREEMENT" means the subscription agreement dated 1
December 2006 relating to the issue and subscription of the Bonds;
"BOND TRUST DEED" means the trust deed dated 1 December 2006 between the
Chargor and the Bond Trustee constituting the Bonds;
"BUSINESS DAY" means any day on which banks in the Xxxxxx Xxxxxxx, Xxxxxx,
Xxxx Xxxx xxx Xxx Xxxx Xxxx are open for business;
"CHARGED PROPERTY" means all beneficial and legal title in and to the
Shares and all other shares in the Company from time to time owned by the
Chargor and all dividends or other distributions, interest and other
moneys paid or payable after the date hereof in connection therewith and
all benefits, proceeds and interests in respect of or derived from all or
any of such Shares (whether by way of redemption, bonus, preference,
option, substitution, conversion or otherwise);
"EVENT OF DEFAULT" means any of the events set out in Condition 11 (Events
of Default) of the Bonds and Condition 11 (Events of Default) of the
Notes;
"NOTEHOLDERS" has the meaning given in the Note Trust Deed;
"NOTE ACCOUNT BANK AGREEMENT" means the agreement dated 1 December 2006
between the Chargor and the Note Trustee;
"NOTE SUBSCRIPTION AGREEMENT" means the subscription agreement dated 1
December 2006 relating to the issue and subscription of the Notes;
"NOTE TRUST DEED" means the trust deed dated 1 December 2006 between the
Chargor and the Note Trustee constituting the Notes;
"PARTIES" means the parties to this Share Mortgage;
"PERSON" means any individual, corporation, partnership, joint venture,
association, joint-stock company, trust, unincorporated organisation,
government or any agency or political subdivision thereof or any other
entity;
"SECURED OBLIGATIONS" means all obligations at any time due, owing or
incurred by the Chargor to any Secured Party under any of the Transaction
Finance Documents, whether present or future, actual or contingent (and
whether incurred solely or jointly and whether as principal or surety or
in some other capacity);
"SECURED PARTIES" means the Security Trustee for itself as security
trustee and on behalf of the Bond Trustee and the Note Trustee, on behalf
of the Bondholders and/or Noteholders, as the case may be;
"SECURITY" has the meaning specified in Condition 4.1 (Security) of the
Terms and Conditions of the Notes;
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"SECURITY INTEREST" means any charge, mortgage, pledge, lien, security
interest or other encumbrance;
"SHARE MORTGAGE" means this share mortgage;
"TRANSACTION FINANCE DOCUMENTS" means the Bonds, the Bond Trust Deed, the
Notes, the Note Trust Deed, this Share Mortgage, the Bond Account Bank
Agreement and the Note Account Bank Agreement; and
"TRANSACTION FINANCE PARTIES" means the Bondholders, the Bond Trustee, the
Noteholders and the Note Trustee.
1.2 In this Share Mortgage:
(a) unless the context otherwise requires or unless otherwise defined,
words and expressions defined in the Bond Trust Deed and the Note
Trust Deed shall have the same meaning when used in this Share
Mortgage;
(b) any reference to the "SECURITY TRUSTEE", the "COMPANY", any
"TRANSACTION FINANCE PARTY" or the "CHARGOR" shall be construed so
as to include its or their (and any subsequent) successors and any
permitted transferees or permitted assigns in accordance with their
respective interests;
(c) references to statutory provisions shall be construed as references
to those provisions as amended or re-enacted or as their application
is modified by other provisions from time to time and shall include
references to any provisions of which they are re-enactments
(whether with or without modification);
(d) references to clauses, recitals and schedules are references to
clauses hereof, recitals hereof and schedules hereto; references to
sub-clauses or paragraphs are, unless otherwise stated, references
to sub-clauses of the clause or paragraphs of the schedule in which
the reference appears;
(e) references to the singular shall include the plural and vice versa
and references to the masculine shall include the feminine or neuter
and vice versa;
(f) references to persons shall include companies, partnerships,
associations and bodies of persons, whether incorporated or
unincorporated;
(g) references to assets include property, rights and assets of every
description; and
(h) references to any document are to be construed as references to such
document as amended or supplemented from time to time.
2. CHARGOR'S REPRESENTATIONS AND WARRANTIES
The Chargor makes the representations and warranties set out in this
Clause 2 to the Security Trustee (for and on behalf of the Transaction
Finance Parties) and acknowledges that the
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Transaction Finance Parties have entered into the Transaction Finance
Documents to which-they are a party in reliance upon those representations
and warranties that:
(a) it is the sole and absolute legal and beneficial owner of all of the
Charged Property free from any Security Interest (other than that
created by this Share Mortgage) and any options or rights of
pre-emption;
(b) it has full power and authority (i) to be the legal and beneficial
owner of the Charged Property (in relation to the Chargor), (ii) to
execute and deliver this Share Mortgage" and (iii) to comply with
the provisions of, and perform all its obligations under, this Share
Mortgage;
(c) this Share Mortgage constitutes its legal, valid and binding
obligations enforceable against it in accordance with the terms of
the Share Mortgage;
(d) the execution, performance of its obligations and liabilities under
this Share Mortgage will not:
(i) contravene any law or regulation or any order of any
governmental or other official authority, body or agency or
any judgment, order or decree of any court having jurisdiction
over it and which is in force as at the date on which any
representation or warranty under this paragraph (d) is made
and/or deemed to be made; or
(ii) conflict with, or result in any breach of any of the terms of,
or constitute a default under, any material agreement or other
instrument to which it is a party or any licence or other
authorisation to which it is subject or by which it or any of
its property is bound in any material respect;
(iii) conflict with, or result in any breach of any of the terms of,
or constitute a default under, any agreement or other
instrument to which it is a party or any licence or other
authorisation to which it is subject or by which it or any of
its property is bound in any way that might result in any
liability on the part of any Transaction Finance Party; or
(iv) contravene or conflict with any provision of its Memorandum
and Articles of Association;
(e) it is able to pay its debts as they fall due and it has not taken
any action nor have any steps been taken or legal proceedings been
started or threatened in writing against it for (i) winding up,
dissolution or reorganisation, (ii) the enforcement of any Security
Interest over its assets, or (iii) the appointment of a liquidator,
receiver, administrative receiver, administrator, trustee or similar
officer of it or of any or all of its assets;
(f) it is not in breach (nor would be in breach with the giving of
notice, passing of time, or satisfaction of any other condition) or
in default under any deed, instrument or any agreement to which it
is a party or which is binding on it or any of its assets which
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breach or default could reasonably be expected to have a material
adverse effect on the Chargor and its subsidiaries taken as a whole;
(g) no investigation, litigation, arbitration or administrative
proceedings of or before any court, arbitral body or agency have (to
the best of its knowledge and belief) been started or threatened, or
are pending, against it;
(h) it has taken all corporate and other action required to approve its
execution, delivery and performance of this Share Mortgage;
(i) this Share Mortgage is effective to create a valid and enforceable
first priority fixed charge upon the Charged Property in favour of
the Security Trustee ranking in priority to the interests of any
liquidator (or similar officer) or creditor of the Chargor;
(j) in any proceedings taken in its jurisdiction of incorporation and/or
the Cayman Islands in relation to this Share Mortgage, it will not
be entitled to claim for itself or any of its assets immunity from
suit, execution, attachment or other legal process;
(k) its execution of this Share Mortgage constitutes, and the
performance of its obligations hereunder will constitute, private
and commercial acts done and performed for private and commercial
purposes;
(l) it has not sold, transferred or otherwise disposed of, or agreed to
sell, transfer or otherwise dispose of, the benefit of all or any of
its rights, title and interest in the Charged Property or any part
thereof (except, for the avoidance of doubt, any dividend, interest
or other money that has been released from the charge hereunder
pursuant to Clause 4.1(b));
(m) the Shares are fully paid and there are no moneys or liabilities
payable or outstanding in respect of thereof;
(n) the constitutional documents of the Company contain all the material
terms of any and all agreements and arrangements between any or all
of the holders of any equity interest in the Company, with respect
to the affairs of the Company. None of the holders of any shares of
or equity interests in the Company, or any of their respective
Affiliates, has entered into any other binding arrangement or
understanding with respect to any of the shares of and/or equity
interests in the Company;
(o) the constitutional documents of the Company are in full force and
effect and have not been (A) terminated, rescinded or cancelled; or
(B) amended, varied, supplemented (from the form delivered to the
Subscribers under Schedule 1 (Conditions precedent) to each of the
Note Subscription Agreement and the Bond Subscription Agreement) in
any material respect except with the prior written consent of the
Bond Trustee and the Note Trustee;
(p) all licences, consents, exemptions, clearance filings, registration,
payments of taxes, notarisation and authorisations as are or may be
necessary for the proper conduct of its business, trade, and
ordinary activities for the performance and discharge of its
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obligations and liabilities under this Share Mortgage and which are
required in connection with the execution, delivery, validity,
enforceability or admissibility in evidence of this Share Mortgage
and/or the creation of security over the Charged Property have been
obtained and are in full force and effect;
(q) under the laws of its jurisdiction of incorporation and/or the
Cayman Islands in force at the date hereof, it is not necessary, or
advisable, that this Share Mortgage be filed, recorded or enrolled
with any court or other authority in such jurisdiction or that any
stamp, registration or similar tax be paid on or in relation to this
Share Mortgage except that stamp duty will be payable in the Cayman
Islands if an original of this Share Mortgage is brought into the
Cayman Islands; and
(r) no restrictions exist in relation to the voting rights associated
with any of the Shares.
The representations and warranties above shall be deemed to be repeated
(with reference to the facts and circumstances then subsisting) on each
date falling on or before the Closing Date.
3. SECURITY
3.1 In consideration of, amongst other things, the execution by the Bond
Trustee and the Note Trustee of the Bond Trust Deed and Note Trust Deed,
respectively and as a continuing security for the full and punctual
payment and discharge of all of the Secured Obligations, the Chargor as
legal and beneficial owner hereby charges to the Security Trustee by way
of a first fixed charge to the Security Trustee as trustee for the Secured
Parties, all of the legal and beneficial right, title and interest in and
to the Charged Property including all benefits, present and future, actual
and contingent accruing in respect of the Charged Property.
3.2 The Chargor and the Company hereby irrevocably:
(a) agrees to the creation of security by the Chargor over the Charged
Property under or pursuant to this Share Mortgage;
(b) waives any and all rights that it may otherwise have to object to,
the creation of security by the Chargor over the Charged Property
(or any part thereof) under or pursuant to this Share Mortgage, any
enforcement of such security in accordance with the terms of this
Share Mortgage and/or any transfer of all or any part of the Charged
Property of the Chargor pursuant to the provisions of this Share
Mortgage or any exercise by the Security Trustee of any of its
rights, powers or remedies hereunder; and
(c) waives any pre-emption rights and any other rights that it may
otherwise have to require all or any part of the Charged Property to
be transferred to it or to its order, by reason of or with respect
to the creation of security by such Chargor over the Charged
Property (or any part thereof) under or pursuant to this Share
Mortgage, any enforcement of such security in accordance with the
terms of this Share Mortgage and/or any transfer of all or any part
of the Charged Property pursuant to the provisions of this Share
Mortgage or any exercise by the Security Trustee of any of its
rights, powers or remedies hereunder.
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3.3 The Chargor hereby agrees that promptly upon execution of this Share
Mortgage to deliver, or cause to be delivered, to the Security Trustee:
(a) its corporate documents required to authorise the execution of this
Share Mortgage;
(b) a duly executed undated share transfer certificate in respect of the
Shares in favour of the Security Trustee or its nominees in
substantially the form set out in Schedule 1 to this Share Mortgage
which by the shareholders letter of authority referred to in Clause
3.3(d) below the Security Trustee will be entitled to date
following the occurrence of an Event of Default;
(c) all share certificates (if any) representing the Shares and a
certified copy of the register of members of the Company;
(d) a duly executed and dated shareholders letter of authority in the
form of Schedule 2 to this Share Mortgage and an irrevocable power
of attorney in the form annexed thereto which in accordance with
its terms shall be exercisable following the occurrence of an Event
of Default;
(e) an executed power of attorney made in respect of the Shares in
favour of the Security Trustee in respect of all written resolutions
of the Company in the form set out in Schedule 3 to this Share
Mortgage;
(f) executed but undated letters of resignation and release together
with letters of authority to date the same following the occurrence
of an Event of Default from each of the directors, alternate
directors and officers of the Company appointed by the Chargor in
the forms set out in Parts I and II of Schedule 4 to this Share
Mortgage; and
(g) an undertaking from the Company to register transfers of the Shares
to the Security Trustee or its nominee in substantially the form set
out in Schedule 5 to this Share Mortgage.
3.4 The Chargor will procure that there shall be no increase or reduction in
the authorised or issued share capital of the Company except as expressly
permitted under the Bonds, the Bond Trust Deed, the Notes and the Note
Trust Deed.
3.5 The Chargor undertakes that it will deliver, or cause to be delivered, to
the Security Trustee immediately upon (subject to Clause 3.4) the
acquisition, accrual, offer or issue of any further Shares, the items
listed in Clauses 3.3(a), 3.3(b), 3.3(c), 3.3(d), 3.3(e), 3.3(f) and
3.3(g) in respect of all such further Shares.
3.6 The Chargor undertakes that it will deliver or cause to be delivered to
the Security Trustee immediately upon the appointment of a new director,
new alternate director or new officer of the Company the items listed in
Clause 3.3(f) with respect to the newly appointed director, alternate
director or officer.
3.7 The Chargor undertakes that, prior to or immediately upon any director who
has signed any undertaking referred to in Clause 3.3(g) ceasing to be a
director of the Company, it will deliver
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or cause to be delivered to the Security Trustee or its nominee another
such undertaking executed by another director of the Company.
3.8 The Chargor covenants that it will remain the legal and beneficial owner
of the Charged Property (subject only to the Security Interests hereby
created) and that it will not:
(a) create or suffer the creation of (i) any Security Interests (other
than those created by this Share Mortgage) on or in respect of the
whole of any part of the Charged Property or any of its interest
therein; or (ii) any restriction on the ability to transfer or
realise all or any part of the Charged Property (except, for the
avoidance of doubt, any dividend, interest or other money that has
been released from the charge hereunder pursuant to Clause 4.1(b));
or
(b) sell, assign, lend, dispose of, transfer or otherwise deal with any
of its interest in the Charged Property in any such case, without
the prior consent in writing of the Security Trustee.
3.9 Without prejudice to Clause 3.8, the Chargor shall:
(a) ensure that at all times the Charged Property is free from any
restriction on transfer and that it shall procure that Memorandum
and Articles of Association of the Company will not contain any
restrictions on transfer which may restrict the ability of the
Security Trustee or any of its nominees to transfer or realise all
or any part of the Charged Property or restrict a transfer of all or
any part of the Charged Property to the Security Trustee or any of
its nominees or purchasers; and
(b) ensure that no restrictions exist in relation to the voting rights
associated with any of the Charged Property.
3.10 The Chargor shall remain liable to perform all the obligations assumed by
it in relation to the Charged Property and the Security Trustee shall be
under no obligation of any kind whatsoever in respect thereof or be under
any liability whatsoever in the event of any failure by the Chargor to
perform its obligations in respect thereof.
3.11 The Chargor shall obtain, comply with the terms of and do all that is
necessary to maintain in full force, and effect all authorisations
required in or by the laws of its jurisdiction of incorporation and/or the
Cayman Islands to enable it lawfully to enter into and perform its
obligations under this Share Mortgage and/or to ensure the legality,
validity, enforceability or admissibility in evidence in its jurisdiction
of incorporation and/or the Cayman Islands of this Share Mortgage.
3.12 The Chargor shall ensure that at all times this Share Mortgage (and the
claims of the Transaction Finance Parties against it hereunder) shall have
the priority which this Share Mortgage is expressed to have.
3.13 The Chargor agrees that no amendment or variation shall be made to the
Memorandum and Articles of Association of the Company except (a) with the
prior written consent of the Security Trustee or (b) as required pursuant
to Clause 3.9.
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3.14 Subject to Clauses 5.2 and 5.3, upon (i) all Secured Obligations having
been irrevocably discharged in full, (ii) all amounts which may be or
become payable by the Chargor under or in connection with the Transaction
Finance Documents have been irrevocably paid in full and (iii) no
Transaction Finance Party is under any further obligation (whether actual
or contingent) to provide any further advance or financial accommodation
to the Chargor under any Transaction-Finance Document, the Security
Trustee shall, at the request (with reasonable notice) and cost of the
Chargor, release and cancel the security constituted by this Share
Mortgage, without recourse to, or any representation or warranty by, the
Security Trustee or any of its nominees.
4. DEALINGS WITH CHARGED PROPERTY
4.1 Unless and until the occurrence of an Event of Default (as long as an
Event of Default is continuing):
(a) the Chargor shall be entitled to exercise all voting and consensual
powers pertaining to the Charged Property or any part thereof
PROVIDED THAT such Chargor shall not exercise such voting rights in
any manner, or otherwise permit or agree to any (i) variation of the
rights attaching to or conferred by all or any part of the Charged
Property (except as required under Clause 3.9 or with the prior
written consent of the Security Trustee), or (ii) increase in the
issued share capital of the Company, which in the opinion of the
Security Trustee would prejudice the validity, enforceability or the
value of, or the ability of the Security Trustee to realise, the
security created by this Share Mortgage or which would cause an
Event of Default to occur; and
(b) the Chargor shall only be entitled to receive and retain any
dividends, interest or other moneys or assets accruing on or in
respect of the Charged Property or any part thereof released from
the charge hereunder to the extent expressly permitted under the
Bonds, the Bond Trust Deed, the Notes, the Note Trust Deed, the Bond
Account Bank Agreement and the Note Account Bank Agreement (and if
the Chargor receives any dividends, interest or other monies arising
from the Charged Property which is not expressly permitted under the
Bonds, the Bond Trust Deed, the Notes, the Note Trust Deed, the Bond
Account Bank Agreement and the Note Account Bank Agreement, such
Chargor shall hold the same on trust for the Security Trustee and
promptly pay over the same to the Security Trustee).
4.2 The Chargor shall pay all calls, instalments or other payments and shall
discharge all other obligations, which may become due in respect of any of
the Charged Property and upon and after the occurrence of an Event of
Default (as long as an Event of Default is continuing) or in the event
that the Chargor fails to do so, the Security Trustee may if it thinks fit
make such payments or discharge such obligations on behalf of the Chargor.
Any sums so paid by the Security Trustee in respect thereof on behalf of
such Chargor shall be repayable by the Chargor on demand (together with
interest thereon, such interest shall be calculated from the due date up
to the actual date of payment (after, as well as before, judgment)
determined in accordance with the provisions of Condition 5.2 (Default
interest) of the Terms and Conditions of the Bonds or the Notes , as the
case may be, as if such reimbursement payment were an Unpaid Sum
outstanding from the Chargor thereunder) and pending such repayment shall
constitute part of the Secured Obligations.
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4.3 The Security Trustee shall not have any duty to ensure that any dividends,
interest or other moneys and assets receivable in respect of the Charged
Property are duly and punctually paid, received or collected as and when
the same become due and payable or to ensure that the correct amounts (if
any) are paid or received on or in respect of the Charged Property or to
ensure the taking up of any (or any offer of any) stocks, shares, rights,
moneys or other property paid, distributed, accruing or offered at any
time by way of redemption, bonus, rights, preference, or otherwise on or
in respect of, any of the Charged Property.
4.4 The Chargor hereby authorises the Security Trustee to arrange at any time
and from time to time (prior to or after the occurrence of an Event of
Default) for the Charged Property (in relation to such Chargor) or any
part thereof to be registered in the name of the Security Trustee (or its
nominee) thereupon to be held, as so registered, subject to the terms of
this Share Mortgage.
5. PRESERVATION OF SECURITY
5.1 It is hereby agreed and declared that:
(a) the security created by this Share Mortgage shall be held by the
Security Trustee as a continuing security for the payment and
discharge of the Secured Obligations and the security so created
shall not be satisfied by any intermediate payment or satisfaction
of any part of the Secured Obligations;
(b) the Security Trustee shall not be obliged to make any demand of the
Chargor, to take any action or obtain judgment in any court against
the Chargor or to make or file any proof or claim in a liquidation
or insolvency of the Chargor or to enforce or seek to enforce any
other security in respect of the Secured Obligations before
exercising any right, power or remedy under this Share Mortgage;
(c) no delay or omission on the part of the Security Trustee in
exercising any right, power or remedy under this Share Mortgage
shall impair such right, power or remedy or be construed as a waiver
thereof nor shall any single or partial exercise of any such right,
power or remedy preclude any further exercise thereof or the
exercise of any other right, power or remedy. The rights, powers and
remedies herein provided are cumulative and not exclusive of any
rights, powers and remedies provided by law and may be exercised
from time to time and as often as the Security Trustee may deem
expedient; and
(d) any waiver by the Security Trustee of any terms of this Share
Mortgage shall only be effective if given in writing and then only
for the purpose and upon the terms for which it is given.
5.2 Any settlement, release or discharge under this Share Mortgage between the
Security Trustee and the Chargor shall be conditional upon no security or
payment to the Security Trustee by the Chargor or any other person being
avoided or set aside or ordered to be refunded or reduced by virtue of any
law, regulation, provision or enactment relating to bankruptcy,
insolvency, administration or liquidation for the time being in force or
for any other reason and, if such condition is not or becomes not
satisfied, the obligations of the Chargor under this Share
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Mortgage and the security hereunder shall continue (as if such settlement,
release or discharge had not occurred), and the Security Trustee shall be
entitled to recover the security and/or payments hereunder from the
Chargor as if such settlement, release or discharge had not occurred. If
the Security Trustee considers that any amount paid or credited to any
Transaction Finance Party by or recovered by any Transaction Finance Party
from the Chargor is capable of being avoided or reduced by virtue of any
bankruptcy, insolvency, liquidation or similar laws, the liabilities of
the Chargor under this Share Mortgage and the security constituted hereby
shall continue and such amount shall not be considered to have been
irrevocably paid.
5.3 The obligations of the Chargor and the rights of the Security Trustee
under this Share Mortgage and the security hereby constituted shall not
be affected by any act, omission, matter or thing which, but for this
provision, might operate to impair, affect or discharge such rights and
security, in whole or in part, including without limitation, and whether
or not known to or discoverable by the Company, the Chargor, the Security
Trustee or any other person:
(a) any time or waiver granted to or composition with the Company, the
Chargor or any other person;
(b) the taking, variation, compromise, renewal or release of or refusal
or neglect to perfect or enforce any rights, remedies or securities
against the Company, the Chargor or any other person;
(c) any legal limitation, disability, incapacity or other circumstances
relating to the Company, the Chargor or any other person;
(d) any amendment, variation, or supplement to or waiver under the
Bonds, the Bond Trust Deed, the Notes or the Note Trust Deed, or any
other document or security;
(e) any amendment, variation, waiver or release of any of the Secured
Obligations (in relation to any or all of the Chargor);
(f) any failure to take or failure to realise the value of any other
collateral in respect of the Secured Obligations or any release,
discharge, exchange or substitution of any such collateral;
(g) the dissolution, liquidation, amalgamation, reconstruction or
reorganisation of the Company, the Chargor or any other person;
(h) the unenforceability, invalidity or frustration of any obligations
of the Company, the Chargor or any other person under the Bonds, the
Bond Trust Deed, the Notes and the Note Trust Deed or any other
document or security; or
(i) any other act, event or omission which but for this provision would
or might operate to impair, discharge or otherwise affect the
obligations of the Chargor hereunder.
5.4 Until (i) all Secured Obligations having been irrevocably discharged in
full, (ii) all amounts which may be or become payable by the Chargor under
or in connection with the Transaction Finance Documents have been
irrevocably paid in full and (iii) no Transaction Finance Party is
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under any further obligation (whether actual or contingent) to provide any
further advance or financial accommodation to the Chargor under any
Transaction Finance Document, the Chargor shall act by virtue of any
payment made hereunder on account of the Secured Obligations or by virtue
of any enforcement by the Security Trustee of its rights under, or the
security constituted by, this Share Mortgage or by virtue of any
relationship between or transaction involving the Chargor and the Company
(whether such relationship or transaction shall constitute the Chargor a
creditor of the Company, a guarantor of the obligations of the Company or
in part subrogated to the rights of others against the Company or
otherwise howsoever and whether or not such relationship or transaction
shall be related to, or in connection with, the subject matter of this
Share Mortgage):
(a) exercise any rights of subrogation in relation to any rights,
security or moneys held or received or receivable by the Security
Trustee or any person;
(b) exercise any right of contribution from any co-surety liable in
respect of such moneys and liabilities under any other guarantee,
security or agreement;
(c) exercise any right of set-off or counterclaim against the Company or
any such co-surety;
(d) receive, claim or have the benefit of any payment, distribution,
security or indemnity from the Company or any such co-surety; or
(e) unless so directed by the Security Trustee (when the Chargor will
prove in accordance with such directions), claim as a creditor of
the Company or any such co-surety in competition with the Security
Trustee.
The Chargor shall hold in trust for the Security Trustee and forthwith pay
or transfer (as appropriate) to the Security Trustee any such payment
(including an amount to any such set-off), distribution or benefit of such
security, indemnity or claim in fact received by it.
5.5 The Chargor shall not accept or permit to subsist any collateral from any
other person in respect of any right which the Chargor may have arising
out of this Share Mortgage. Notwithstanding the foregoing, if any such
collateral shall be accepted or subsisting, the Chargor shall hold any and
all rights under such collateral on trust for the Security Trustee.
5.6 Until (i) all Secured Obligations have been irrevocably discharged in
full, (ii) all amounts which may be or become payable by any or all of the
Chargor under or in connection with the Transaction Finance Documents have
been irrevocably paid in full and (iii) no Transaction Finance Party is
under any further obligation (whether actual or contingent) to provide any
further advance or financial accommodation to the Chargor under any
Transaction Finance Document, the Security Trustee may at any time keep in
a separate account or accounts (without liability to pay interest thereon)
in the name of the Security Trustee for as long as it may think fit, any
moneys received recovered or realised under this Share Mortgage or under
any other guarantee, security or agreement relating in whole or in part to
the Secured Obligations (and whether or not any such Secured Obligations
shall have become due) without being under any intermediate obligation to
apply the same or any part thereof in or towards the discharge of such
amount pending any further application of such moneys (as the Security
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Trustee shall be entitled, but not obliged, to do in its discretion) in
accordance with the provisions of Clause 9.
6. ENFORCEMENT OF SECURITY
6.1 Upon or at any time after the occurrence of an Event of Default (as long
as an Event of Default is continuing) or a demand being made for the
payment of the Secured Obligations the security hereby constituted shall
become immediately enforceable and the rights of enforcement of the
Security Trustee under this Share Mortgage shall be immediately
exercisable upon and at any time thereafter and, without prejudice to the
generality of the foregoing the Security Trustee without further notice to
the Chargor:
(a) may solely and exclusively exercise all voting and/or consensual
powers pertaining to the Charged Property or any part thereof and
may exercise such powers in a such manner as the Security Trustee
may think fit; and/or
(b) may receive and retain all dividends, interest or other moneys or
assets accruing on or in respect of the Charged Property or any part
thereof, such dividends, interest or other moneys or assets to be
held by the Security Trustee, until applied in the manner described
in Clause 9 as additional security charged under and subject to the
terms of this Share Mortgage and any such dividends, interest and
other moneys or assets received by the Chargor after such time shall
be held in trust by such Chargor for the Security Trustee and paid
or transferred to the Security Trustee on demand; and/or
(c) may sell, transfer, grant options over or otherwise dispose of the
Charged Property or any part thereof at such place and in such
manner and at such price or prices as the Security Trustee may deem
fit, and thereupon the Security Trustee shall have the right to
deliver, assign and transfer in accordance therewith the Charged
Property so sold, transferred, granted options over or otherwise
disposed of.
6.2 The Security Trustee shall not be obliged to make any enquiry as to the
nature or sufficiency of any payment received by it under this Share
Mortgage or to make any claim or to take any action to collect any moneys
assigned by this Share Mortgage or to enforce any rights or benefits
assigned to the Security Trustee by this Share Mortgage or to which the
Security Trustee may at any time be entitled hereunder.
6.3 A certificate in writing by an officer or agent of the Security Trustee
that any power of sale or other disposal has arisen and is exercisable
shall be conclusive prima facie evidence of that fact, in favour of a
purchaser of all or any part of the Charged Property.
6.4 Upon any sale or disposal of the Charged Property or any part thereof by
the Security Trustee in accordance with the provisions of this Share
Mortgage, the purchaser shall not be bound to see or enquire whether the
Security Trustee's power of sale has become exercisable in the manner
provided in this Share Mortgage and the sale shall be deemed to be within
the power of the Security Trustee, and the receipt of the Security Trustee
for the purchase money shall effectively discharge the purchaser who shall
not be concerned with the manner of application of the proceeds of sale or
be in any way answerable therefor.
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6.5 In making any sale or disposal of any of the Charged Property or making
any acquisition, the Security Trustee may do so for such consideration, in
such manner and on such terms as it thinks fit.
6.6 Neither the Security Trustee nor its agents, managers, officers,
employees, delegates and advisers shall be liable for any claim, demand,
liability, loss, damage, cost or expense incurred or arising in connection
with the exercise or purported exercise of any rights, powers and
discretions hereunder in the absence of gross negligence, or wilful
default (in each case as finally judicially determined).
6.7 The Security Trustee shall not by reason of the taking of possession of
the whole or any part of the Charged Property or any part thereof be
liable to account as mortgagee-in-possession or for anything except actual
receipts or be liable for any loss upon realisation or for any default or
omission for which a mortgagee-in-possession might be liable.
7. FURTHER ASSURANCES
The Chargor shall execute and do all such assurances, acts and things as
the Security Trustee in its absolute discretion may require for:
(a) perfecting, protecting or ensuring the priority of the security
hereby created (or intended to be created);
(b) preserving or protecting any of the rights of the Security Trustee
under this Share Mortgage;
(c) ensuring that the security constituted by this Share Mortgage and
the covenants and obligations of the Chargor under this Share
Mortgage shall inure to the benefit of any assignee of the Security
Trustee;
(d) facilitating the appropriation or realisation of the Charged
Property or any part thereof; or
(e) the exercise of any power, authority or discretion vested in the
Security Trustee under this Share Mortgage,
in any such case, forthwith upon demand by the Security Trustee and at the
expense of the Chargor.
7.1 Following execution of this Share Mortgage, the Chargor shall create and,
for so long as the Secured Obligations remain outstanding maintain, a
register of mortgages, charges and encumbrances (the "Charges Register")
at its registered office in the British Virgin Islands which contains
particulars of this Share Mortgage in a form to the reasonable
satisfaction of the Security Trustee.
7.2 Within 7 Business Days of the execution of this Share Mortgage, the
Chargor shall register the Charges Register containing particulars of this
Share Mortgage with the Registrar of Corporate Affairs in the British
Virgin Islands and, immediately upon receipt by the Chargor of the
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Charges Register duly stamped by the Registrar of Corporate Affairs in the
British Virgin Islands, provide a copy thereof to the Security Trustee.
8. TRUST FOR THE SECURED PARTIES
8.1 Trust
8.1.1 The Security Trustee declares that it shall hold the Charged
Property on trust for the Secured Parties on the terms contained
in this Share Mortgage.
8.1.2 Each of the parties to this Share Mortgage agrees that the
Security Trustee shall have only those duties, obligations and
responsibilities expressly specified in this Share Mortgage (and
no others shall be implied).
8.2 No Independent Power
The Secured Parties shall not have any independent power to enforce, or
have recourse to, any of the Charged Property or to exercise any rights or
powers arising under this Share Mortgage except through the Security
Trustee.
8.3 Security Trustee's instructions
The Security Trustee shall:
8.3.1 unless a contrary indication appears in this Share Mortgage, act
in accordance with any reasonable instructions given to it by the
Bond Trustee and the Note Trustee and shall be entitled to assume
that (i) any instructions received by it from the Bond Trustee and
the Note Trustee are duly given in accordance with the terms of
the Transaction Finance Documents and (ii) unless it has received
actual notice of revocation, that those instructions or directions
have not been revoked;
8.3.2 be entitled to request instructions, or clarification of any
direction, from the Bond Trustee and the Note Trustee as to
whether, and in what manner, it should exercise or refrain from
exercising any rights, powers and discretions and the Security
Trustee may refrain from acting unless and until those
instructions or clarification are received by it; and
8.3.3 be entitled to carry out all dealings with the Secured Parties
through the Bond Trustee and the Note Trustee and may give to the
Bond Trustee and the Note Trustee any notice or other
communication required to be given by the Security Trustee to the
Secured Parties.
8.4 Security Trustee's actions
Subject to the provisions of Clause 8.3 (Security Trustee's instructions):
8.4.1 the Security Trustee may, in the absence of any instructions to
the contrary, take such action in the exercise of any of its
powers and duties under the Transaction Finance Documents which in
its absolute discretion it considers to be for the protection and
benefit of all the Secured Parties; and
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8.4.2 at any time after receipt by the Security Trustee of notice from
the Bond Trustee and/or the Note Trustee directing the Security
Trustee to exercise all or any of its rights, remedies, powers or
discretions under any of the Transaction Finance Documents, the
Security Trustee may, and shall if so directed by the Bond Trustee
and/or the Note Trustee, take any action as in its sole discretion
it thinks fit to enforce the Secured Obligations.
8.5 Security Trustee's discretions
The Security Trustee may:
8.5.1 assume (unless it has received actual notice to the contrary from
one of the Bond Trustee and/or the Note Trustee in its capacity as
trustee for the Secured Parties) that (i) no Event of Default has
occurred and the Chargor is not in breach of or default under its
obligations under any of the Transaction Finance Documents and
(ii) any right, power, authority or discretion vested by any
Transaction Finance Document in any person has not been exercised;
8.5.2 if it receives any instructions or directions from the Bond
Trustee and/or the Note Trustee, assume that all applicable
conditions under the Transaction Finance Documents for taking that
action have been satisfied;
8.5.3 engage, pay for and rely on the advice or services of any lawyers,
accountants, surveyors or other experts (whether obtained by the
Security Trustee or by any other Secured Party) whose advice or
services may at any time seem necessary, expedient or desirable;
8.5.4 rely upon any communication or document believed by it to be
genuine and, as to any matters of fact which might reasonably be
expected to be within the knowledge of a Secured Party or the
Chargor, upon a certificate signed by or on behalf of that person;
and
8.6 Refrain from acting in accordance with the instructions of the Bond
Trustee or the Note Trustee (including bringing any legal action or
proceeding arising out of or in connection with the Transaction Finance
Documents) until it has received any indemnification and/or security that
it may in its absolute discretion require (whether by way of payment in
advance or otherwise) for all costs, losses and liabilities which it may
incur in bringing any action or proceedings.
8.7 Excluded obligations
Notwithstanding anything to the contrary expressed or implied in the
Transaction Finance Documents, the Security Trustee shall not:
8.7.1 be bound to enquire as to (i) whether or not any Event of Default
has occurred or (ii) the performance, default or any breach by the
Chargor of its obligations under any of the Transaction Finance
Documents;
8.7.2 be bound to account to any other party for any sum or the profit
element of any sum received by it for its own account;
8.7.3 be bound to disclose to any other person (including but not
limited to any Secured Party) (i) any confidential information or
(ii) any other information if disclosure would or
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might in its reasonable opinion constitute a breach of any law or
be a breach of fiduciary duty;
8.7.4 be under any obligations other than those which are specifically
provided for in the Transaction Finance Documents; or
8.7.5 have or be deemed to have any duty, obligation or responsibility
to, or relationship of trust or agency with, the Chargor.
8.8 Exclusion of Security Trustee's liability
The Security Trustee shall not accept responsibility or be liable for:
8.8.1 the adequacy, accuracy and/or completeness of any information
(whether oral or written) supplied by the Security Trustee or any
other person in or in connection with any Transaction Finance
Document or the transactions contemplated in the Transaction
Finance Documents, or any other agreement, arrangement or document
entered into, made or executed in anticipation of, under or in
connection with any Transaction Finance Document;
8.8.2 the legality, validity, effectiveness, adequacy or enforceability
of any Transaction Finance Document or the Secured Obligations or
any other agreement, arrangement or document entered into, made or
executed in anticipation of, or in connection with any Transaction
Finance Document, the Charged Property or the Secured Obligations;
8.8.3 any losses to any person or any liability arising as a result of
taking or refraining from taking any action in relation to any of
the Transaction Finance Documents or the Secured Obligations or
otherwise, whether in accordance with an instruction from the Bond
Trustee or the Note Trustee or otherwise unless directly caused by
its gross negligence or wilful misconduct;
8.8.4 the exercise of, or the failure to exercise, any judgment,
discretion or power given to it by or in connection with any of
the Transaction Finance Documents, the Secured Obligations or any
other agreement, arrangement or document entered into, made or
executed in anticipation of, or in connection with the Transaction
Finance Documents or the Secured Obligations; or
8.8.5 any shortfall which arises on the enforcement of the Secured
Obligations.
8.9 No proceedings
No Party (other than the Security Trustee) may take any proceedings
against any officer, employee or agent of the Security Trustee in respect
of any claim it might have against the Security Trustee or in respect of
any act or omission of any kind by that officer, employee or agent in
relation to any Transaction Finance Document or any Secured Obligations
and any officer, employee or agent of the Security Trustee may rely on
this Clause 8.
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8.10 No responsibility to perfect security
The Security Trustee shall not be liable for any failure to:
8.10.1 require the deposit with it of any deed or document certifying,
representing or constituting the title of the Chargor to any of
the Charged Property;
8.10.2 obtain any licence, consent or other authority for the execution,
delivery, legality, validity, enforceability or admissibility in
evidence of any of the Transaction Finance Documents or the
Secured Obligations;
8.10.3 register, file or record or otherwise protect any of the Secured
Obligations (or the priority of any of the Secured Obligations)
under any applicable laws in any jurisdiction or to give notice to
any person of the execution of any of the Transaction Finance
Documents or of the Secured Obligations;
8.10.4 take, or to require the Chargor to take, any steps to perfect its
title to any of the Charged Property or to render the Secured
Obligations effective or to secure the creation of any ancillary
Security under the laws of any jurisdiction; or
8.10.5 require any further assurances in relation to this Share Mortgage.
8.11 Insurance by Security Trustee
8.11.1 The Security Trustee shall not be under any obligation to insure
any of the Charged Property, to require any other person to
maintain any insurance or to verify any obligation to arrange or
maintain insurance contained in the Transaction Finance Documents.
The Security Trustee shall not be responsible for any loss which
may be. suffered by any person as a result of the lack of or
inadequacy of any such insurance.
8.11.2 Where the Security Trustee is named on any insurance policy as an
insured party, it shall not be responsible for any loss which may
be suffered by reason of, directly or indirectly, its failure to
notify the insurers of any material fact relating to the risk
assumed by such insurers or any other information of any kind,
unless the Bond Trustee or the Note Trustee shall have requested
it to do so in writing and the Security Trustee shall have failed
to do so within fourteen days after receipt of that request.
8.12 Custodians and nominees
The Security Trustee may appoint and pay any person to act as a custodian
or nominee on any terms in relation to any assets of the trust as the
Security Trustee may determine, including for the purpose of depositing
with a custodian this Agreement or any document relating to the trust
created under this Share Mortgage and the Security Trustee shall not be
responsible for any loss, liability, expense, demand, cost, claim or
proceedings incurred by reason of the misconduct, omission or default on
the part of any person appointed by it under this Share Mortgage or be
bound to supervise the proceedings or acts of any person.
8.13 Acceptance of title
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The Security Trustee shall be entitled to accept without enquiry, and
shall not be obliged to investigate, any right and title that the Chargor
may have to any of the Charged Property and shall not be liable for or
bound to require the Chargor to remedy any defect in its right or title.
8.14 Refrain from illegality
The Security Trustee may retrain from doing anything which in its opinion
will or may be contrary to any relevant law, directive or regulation of
any jurisdiction which would or might otherwise render it liable to any
person, and the Security Trustee may do anything which is, in its opinion,
necessary to comply with any such law, directive or regulation.
8.15 Business with the Chargor
The Security Trustee may accept deposits from, lend money to, and
generally engage in any kind of banking or other business with the
Chargor.
8.16 Winding up of trust
If the Security Trustee, with the approval of each of the Bond Trustee and
the Note Trustee, determines that (a) all of the Secured Obligations have
been fully and finally discharged and (b) none of the Secured Parties is
under any commitment, obligation or liability (actual or contingent) to
make advances or provide other financial accommodation to the Chargor
pursuant to the Transaction Finance Documents, the trusts set out in this
Agreement shall be wound up and the Security Trustee shall release,
without recourse or warranty, all of the Secured Obligations and the
rights of the Security Trustee under this Share Mortgage.
8.17 Security Trustee division separate
8.17.1 In acting as security trustee for the Secured Parties, the
Security Trustee shall be regarded as acting through its trustee
division which shall be treated as a separate entity from any of
its other divisions or departments.
8.17.2 If information is received by another division or department of
the Security Trustee, it may be treated as confidential to that
division or department and the Security Trustee shall not be
deemed to have notice of it.
9. APPLICATION OF PROCEEDS
9.1 Order of Application
All amounts from time to time received or recovered by the Security
Trustee in connection with the realisation or enforcement of all or any
part of the Secured Obligations shall be held by the Security Trustee on
trust to apply them at any time the Security Trustee sees fit, to the
extent permitted by applicable law (subject to the provisions of this
Clause 9 (Application of Proceeds)), in the following order of priority:
9.1.1 in discharging any sums owing to the Security Trustee (in its
capacity as such), or any receiver or delegate;
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9.1.2 in discharging any sums owing to the Bond Trustee and the Note
Trustee (in their, capacity as such);
9.1.3 in payment to the Bond Trustee and the Note Trustee, on behalf of
their respective Bondholders and Noteholders, for application
towards the discharge of all sums due and payable by the Chargor
under any of the Transaction Finance Documents in the proportions
borne by the aggregate of the outstanding amounts of each of their
respective Bondholders and Noteholders to the aggregate of
outstanding amounts of all of the Bondholders and Noteholders;
9.1.4 if the Chargor is not under any further actual or contingent
liability under any Transaction Finance Document, in payment to
any person to whom the Trustee is obliged to pay in priority to
the Chargor; and
9.1.5 the balance, if any, in payment to the Chargor.
9.2 Investment of Proceeds
Prior to the application of proceeds in accordance with Clause 9.1 (Order
of Application) the Security Trustee may, at its discretion, hold all or
part of those proceeds in an interest bearing suspense or impersonal
account(s) in the name of the Security Trustee with a financial
institution (including itself) for so long as the Security Trustee shall
think fit (the interest being credited to the relevant account) pending
the application from time to time of those monies at the Security
Trustee's discretion in accordance with the provisions of this Clause 9
(Application of Proceeds).
9.3 Currency Conversion
9.3.1 For the purpose of, or pending the discharge of, any of the
Secured Obligations the Security Trustee may convert any moneys
received or recovered by the Security Trustee from one currency to
another, at the spot rate at which the Security Trustee is able to
purchase the currency in which the Secured Obligations are due
with the amount received.
9.3.2 The obligations of the Chargor to pay in the due currency shall
only be satisfied to the extent of the amount of the due currency
purchased after deducting the costs of conversion.
9.4 Permitted Deductions
The Security Trustee shall be entitled (a) to set aside by way of reserve
amounts required to meet and (b) to make and pay, any deductions and
withholdings (on account of taxes or otherwise) which it is or may be
required by any applicable law to make from any distribution or payment
made by it under this Share Mortgage, and to pay all taxes which may be
assessed against it in respect of any of the Charged Property, or as a
consequence of performing its duties, or by virtue of its capacity as
Security Trustee under any of the Transaction Finance Documents or
otherwise (other than in connection with its remuneration for performing
its duties under this Share Mortgage).
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9.5 Discharge of Secured Obligations
9.5.1 Any payment to be made in respect of the Secured Obligations by
the Security Trustee may be made to the Bond Trustee and/or the
Note Trustee, as the case may be on behalf of the Bondholders
and/or the Noteholders, as the case may be, and any payment so
made shall be a good discharge to the extent of that payment, to
the Security Trustee.
9.5.2 The Security Trustee is under no obligation to make the payment to
the Agents under Clause 2.5.1 above in the same currency as that
in which the Bonds and the Notes are denominated.
9.6 Sums received by Chargor
If the Chargor receives any sum which, pursuant to any of the Transaction
Finance Documents, should have been paid to the Security Trustee, that sum
shall promptly be paid to the Security Trustee for application in
accordance with this Clause 9 (Application of Proceeds).
10. INDEMNITIES
10.1 The Chargor will, indemnify and hold harmless the Security Trustee and
each agent or attorney appointed under or pursuant to this Share Mortgage
from and against any and all expenses, claims, liabilities, losses, taxes,
costs, duties, fees and charges suffered, incurred or made by the Security
Trustee or such agent or attorney:
(a) in the exercise or purported exercise of any rights, powers or
discretions vested in them pursuant to this Share Mortgage;
(b) in the preservation or enforcement of the Security Trustee's rights
under this Share Mortgage or the priority thereof;
(c) on the release of any part of the Charged Property from the security
created by this Share Mortgage; or
(d) arising out of any breach by the Chargor of any term of this Share
Mortgage,
and the Security Trustee or such agent or attorney may retain and pay all
sums in respect of the same out of money received under the powers
conferred by this Share Mortgage. All amounts suffered, incurred or paid
by the Security Trustee or such agent or attorney or any of them shall be
recoverable on a full indemnity basis provided that nothing in this Clause
10.1 shall require the Chargor to indemnify and save harmless the Security
Trustee from and against any expenses, claims, liabilities, losses, taxes,
costs, duties, fees and charges suffered, incurred or made by the Security
Trustee as a result of the Security Trustee's gross negligence or wilful
default (in each case as finally judicially determined).
10.2 If, under any applicable law or regulation, and whether pursuant to a
judgment being made or registered against the Chargor or the bankruptcy or
liquidation of the Chargor or for any other reason any payment under or in
connection with this Share Mortgage is made or fails to be satisfied in a
currency (the "PAYMENT CURRENCY") other than the currency in which such
payment is due under or in connection with this Share Mortgage (the
"CONTRACTUAL
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CURRENCY"), then to the extent that the amount of such payment actually
received by the Security Trustee when converted into the Contractual
Currency at the rate of exchange, falls short of the amount due under or
in connection with this Share Mortgage, the Chargor, as a separate and
independent obligation, shall, indemnify and hold harmless the Security
Trustee against the amount of such shortfall. For the purposes of this
Clause 10.2, "rate of exchange" means the rate at which the Security
Trustee is able on or about the date of such payment to purchase, from
such source as it may select in its ordinary course of business (acting
reasonably) the Contractual Currency with the Payment Currency and shall
take into account any premium and other costs of exchange with respect
thereto.
11. SUBSEQUENT INTERESTS AND ACCOUNTS
If the Security Trustee or any other Transaction Finance Party at any time
receives notice of any subsequent mortgage, assignment, charge or other
interest affecting all or any part of the Charged Property, all payments
made by the Chargor to the Security Trustee or any of the Transaction
Finance Parties after that time shall be treated as having been credited
to a new account of the Chargor and not as having been applied in
reduction of the Secured Obligations as at the time when the Security
Trustee or such other Transaction Finance Party received notice.
12. POWER OF ATTORNEY
12.1 The Chargor, by way of security and in order more fully to secure the
performance of its obligations hereunder pursuant to the Power of Attorney
Law (1996 Revision), hereby irrevocably appoints the Security Trustee and
the persons deriving title under it jointly and also severally to be its
attorney to execute and complete in favour of the Security Trustee or its
nominees or of any purchaser any documents which the Security Trustee may
from time to time require for perfecting its title to or for vesting any
of the assets and property hereby charged or assigned in the Security
Trustee or its nominees or in any purchaser and to give effectual
discharges for payments, to take and institute on non-payment (if the
Security Trustee in its sole discretion so decided) all steps and
proceedings in the name of the Chargor or of the Security Trustee for the
recovery of such moneys, property and assets hereby charged and to agree
accounts and make allowances and give time or other indulgence to any
surety or other person liable and otherwise generally for it and in its
name and on its behalf and as its act and deed or otherwise execute, seal
and deliver and otherwise perfect and do any such legal assignments and
other assurances, charges, authorities and documents over the moneys,
property and assets hereby charged, and all such deeds, instruments, acts
and things (including, without limitation, those referred to in Clause 7)
which may be required for the full exercise of all or any of the powers
conferred or which may be deemed proper on or in connection with any of
the purposes aforesaid. Notwithstanding any other provision of this Clause
12.1, such power shall not be exercisable by or on behalf of the Security
Trustee as the case may be until an Event of Default has occurred and such
Event of Default is continuing.
12.2 The power hereby conferred shall be a general power of attorney and the
Chargor hereby ratifies and confirms and agrees to ratify and confirm any
instrument, act or thing which any such attorney may execute or do
pursuant to Clausel2.1. In relation to the power referred to
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herein, the exercise by the Security Trustee of such power shall be
conclusive evidence of its right to exercise the same.
13. EXPENSES
13.1 The Chargor shall pay to the Security Trustee on demand all costs, fees
and expenses (including, but not limited to, legal fees and expenses) and
taxes thereon (together with interest from the date the costs, fees,
expenses and/or taxes were incurred to the date of payment calculated in
accordance with the provisions of Condition 5.2 (Default interest) of the
Terms and Conditions of the Bonds or the Notes, as the case may be, as if
they were Unpaid Sums thereunder) incurred by the Security Trustee or for
which the Security Trustee may become liable in connection with:
(a) the preserving or enforcing of, or attempting to preserve or
enforce, any of its rights under this Share Mortgage or the priority
hereof;
(b) any variation of, or amendment or supplement to, any of the terms of
this Share Mortgage; and/or
(c) any consent or waiver required by the Chargor from the Security
Trustee in relation to this Share Mortgage,
and in the case referred to in Clauses 13.1(b) and 13.1(c) provided that
such costs, fees and/or expenses are reasonably incurred but regardless of
whether any such variation, amendment, supplement, consent or waiver is
actually implemented, completed or granted, as the case may be.
13.2 The Chargor shall, pay promptly all stamp, documentary and other like
duties and taxes to which this Share Mortgage may be subject or give rise
and shall indemnify the Security Trustee on demand against any and all
liabilities with respect to or resulting from any delay or omission on the
part of the Chargor to pay any such duties or taxes.
14. NOTICES
14.1 Any communication to be made by a party hereto to another party hereto
under or in connection with this Share Mortgage shall be made in writing
and, unless otherwise stated, may be made by fax or letter.
14.2 The address and fax number (and the department or officer, if any, for
whose attention the communication is to be made) of each party hereto for
any communication or document to be made or delivered under or in
connection with this Share Mortgage is that identified with its name
below, or any substitute address or fax number or department or officer as
that party may notify the Security Trustee (or the Security Trustee may
notify to the other parties hereto, if a change is made by the Security
Trustee) by not less than five Business Days' notice.
14.3 Subject to Clause 14.4, any communication or document made or delivered by
any party hereto to another, party hereto under or in connection with this
Share Mortgage will only be effective:
(a) if by way of fax, when received in legible form; or
- 23 -
(b) if by way of letter, when it has been left at the relevant address
or five Business Days after being deposited in the post postage
prepaid in an envelope addressed to it at that address,
and, if a particular department or officer is specified as part of its
address details provided under Clause 14.2, if addressed to that
department or officer.
14.4 Any communication or document to be made or delivered to the Security
Trustee will be effective only when actually received by the Security
Trustee and then only if it is expressly marked for the attention of the
department or officer identified with the Security Trustee's signature
below (or any substitute department or officer as the Security Trustee
shall specify for that purpose).
14.5 Any notice given under or in connection with this Share Mortgage must be
in English.
14.6 All other documents provided under or in connection with this Share
Mortgage must be:
(a) in English; or
(b) if not in English, and if so required by the Security Trustee,
accompanied by a certified English translation and, in this case,
the English translation will prevail unless the document is a
constitutional, statutory or other official document.
15. ASSIGNMENTS
15.1 This Share Mortgage shall be binding upon and shall inure to the benefit
of the Chargor, the Company and the Security Trustee and each of their
respective successors and (subject as hereinafter provided) assigns and
references in this Share Mortgage to any of them shall be construed
accordingly.
15.2 Neither the Chargor nor the Company may assign or transfer all or any part
of its rights and/or obligations under this Share Mortgage,
15.3 The Security Trustee may assign or transfer all or any part of its rights
or obligations under this Share Mortgage to any assignee or transferee
without the consent of the Chargor or the Company. The Security Trustee
shall notify the Chargor promptly following any such assignment or
transfer. The Chargor and the Company agrees to any disclosure of any
information by the Security Trustee to its successors, assignees and
transferees.
16. MISCELLANEOUS
16.1 The Security Trustee, at any time and from time to time, may delegate by
power of attorney or. in any other manner to any person or persons all or
any of the powers, authorities and discretions which are for the time
being exercisable by the Security Trustee under this Share Mortgage in
relation to the Charged Property or any part thereof. Any such delegation
may be made upon such terms and be subject to such regulations as the
Security Trustee may think fit and provided the Security Trustee has
exercised reasonable care in the selection of such person or persons to
which any such delegation may be made it shall not be bound to supervise
the
- 24 -
proceedings or acts of and shall not in any way or to any extent be
responsible for any liability incurred by reason of the misconduct
omission or default on the part of any such person.
16.2 If any clause, condition, covenant or restriction (the "Provision") of
this Share Mortgage or any deed or document emanating from it shall be
found to be void but would be valid if some part thereof were deleted or
modified, then the Provision shall apply with such deletion or
modification as may be necessary to make it valid and effective.
16.3 This Share Mortgage (together with any documents referred to herein)
constitutes the whole agreement between the Parties relating to its
subject matter and no variations hereof shall be effective unless made in
writing and signed by each of the Parties.
16.4 The headings in this Share Mortgage are inserted for convenience only and
shall not affect the construction of this Share Mortgage.
16.5 This Share Mortgage may be executed in counterparts each of which when
executed and delivered shall constitute an original but all such
counterparts together shall constitute one and the same instrument.
16.6 All payments to be made by the Chargor under this Share Mortgage shall be
made free and clear of and without deduction for or on account of tax
unless the Chargor are required to make such payment subject to the
deduction or withholding of tax, in which case the sum payable by the
Chargor in respect of which such deduction or withholding is required to
be made shall be increased to the extent necessary to ensure that, after
the making of such deduction or withholding, the person on account of
whose liability to tax such deduction or withholding has been made
receives and retains (free from any liability in respect of any such
deduction or withholding) a net sum equal to the sum which it would have
received and so retained had no such deduction or withholding been made or
required to be made.
16.7 The Company is party to this Share Mortgage for the purpose of Clause 3.2
but the Company shall have no rights under this Share Mortgage or any
provision hereof.
16.8 Without prejudice to any other mode of service allowed under any relevant
law, the Chargor:
(a) irrevocably appoints Codan Trust Company (Cayman) Limited of Cricket
Square, Xxxxxxxx Drive, XX Xxx 0000, Xxxxx Xxxxxx XX0-0000, Xxxxxx
Islands as its agent for service of process in relation to any
proceedings before the courts of the Cayman Islands in connection
with this Share Mortgage; and
(b) agrees that failure by a process agent to notify the Chargor of any
process will not invalidate the proceedings concerned.
- 25 -
17. LAW AND JURISDICTION
17.1 GOVERNING LAW
This Share Mortgage is governed by and shall be construed in accordance
with Cayman Islands law.
17.2 CAYMAN ISLAND COURTS
The courts of the Cayman Islands have jurisdiction to settle any disputes
(a "DISPUTE") arising out of, or connected with this Share Mortgage
(including a dispute regarding the existence, validity or termination of
this Share Mortgage or the consequences of its nullity) and each of the
Chargor and the Company irrevocably submits to the jurisdiction of such
courts. Each of the Chargor and the Company agrees that the process by
which any proceedings in the Cayman Islands are begun may be served on it
by being delivered to the Chargor at the address specified in Clause 14
above.
17.3 CONVENIENT FORUM
The Parties agree that the courts of the Cayman Islands are the most
appropriate and convenient courts to settle Disputes between them and,
accordingly, that they will not argue to the contrary.
17.4 NON-EXCLUSIVE JURISDICTION
This Clause 17 (Law and Jurisdiction) is for the benefit of the Security
Trustee only. As a result and notwithstanding Clause 17.2 (Cayman Island
Courts), it does not prevent the Security Trustee from taking proceedings
relating to a Dispute in any other courts with jurisdiction, nor shall the
taking of proceedings in any one or more jurisdictions preclude the taking
of proceedings in any other jurisdiction (whether concurrently or not) if
and to the extent permitted by law.
- 26 -
SCHEDULE 1
FORM OF SHARE TRANSFER CERTIFICATE
EASTAR GROUP HOLDINGS LIMITED (THE "COMPANY")
SHARE TRANSFER CERTIFICATE
We, Expert Master Holdings Limited (the "TRANSFEROR"), for good and valuable
consideration received by us from The Hongkong and Shanghai Banking Corporation
Limited (the "TRANSFEREE"), do hereby:
(1) transfer to the Transferee 1,388 Shares (the "SHARES") standing in
our name in the register of the Company, free of any liens,
encumbrances or other restrictions thereon; and
(2) consent that our name remains on the register of the Company until
such time as the Company enters the Transferee's name in the
register of the Company.
And we, the Transferee, do hereby agree to take the Shares subject to the same
conditions.
AS WITNESS OUR HANDS
Signed by the Transferor on
the day of , 20_____,
in the presence of:
____________________________ ____________________________
Witness Transferor
Signed by the Transferee on
the day of , 20_____,
in the presence of:
____________________________ ____________________________
Witness Transferee
- 27 -
SCHEDULE 2
SHAREHOLDERS LETTER OF AUTHORITY
To: The Security Trustee (as defined in the Share Mortgage), which expression
shall include its successors, assigns and transferees
Date: 1 December 2006
Dear Sirs
EASTAR GROUP HOLDINGS LIMITED (the "COMPANY")
We hereby unconditionally and irrevocably authorise you to date, deliver, give
full effect to and otherwise complete the share transfer (in respect of our
shares in the Company) deposited by us with yourselves pursuant to the Share
Mortgage dated 1 December 2006 (as amended, varied, novated or supplemented from
time to time, the "SHARE MORTGAGE") between ourselves and yourselves, following
the occurrence of an Event of Default (as defined in the Share Mortgage whether
by incorporation by reference or otherwise) and for such purposes we attach a
duly executed and dated irrevocable power of attorney in the form as annexed
hereto.
Yours faithfully,
EXPERT MASTER HOLDINGS LIMITED
By:
By: _______________________________
Name:
Title:
- 28 -
ANNEX TO SCHEDULE 2
FORM OF SECURITY POWER OF ATTORNEY
THIS POWER OF ATTORNEY is made the 1st day of December 2006.
BY: EXPERT MASTER HOLDINGS LIMITED (the "CHARGOR", which expression
shall include its successors, assigns and transferees)
WHEREAS The Chargor has determined to appoint the Attorneys (as defined
below) to be the Chargor's attorney-in-fact for the purposes noted
below.
NOW IT IS AGREED AND DECLARED AS FOLLOWS:
THE CHARGOR HEREBY IRREVOCABLY MAKES, CONSTITUTES AND APPOINTS any officer or
agent from time to time of The Hongkong and Shanghai Banking Corporation Limited
(the "ATTORNEYS") to be the true and lawful attorneys-in-fact of the Chargor for
and in the name of and on behalf of the Chargor, acting jointly or singly
following the occurrence of an Event of Default (as defined in the Share
Mortgage defined below), to do and execute all and any of the acts, things and
other matters following, namely:
1. To approve, amend, complete, date, execute and deliver any share transfer
form(s) (the "DOCUMENT") in relation to the share(s) (the "SHARES") held
by the Chargor in the capital of Eastar Group Holdings Limited (the
"CAYMAN ENTITY").
2. To act as the proxy and attorneys-in-fact of the Chargor to vote the
Shares at all or any general meetings of shareholders or stockholders of
the Cayman Entity and to requisition and convene a meeting or meetings of
the shareholders or stockholders of the Cayman Entity.
3. To approve, amend, complete, date, execute and deliver any other document
(including any document appointing a substitute Attorney) which the
Attorneys or any of them shall think necessary, advisable, convenient or
otherwise desirable for the purposes of implementing or otherwise giving
effect to the transactions contemplated by the Document and/or the matters
referred to in paragraph 2 above (such documents being referred to in this
Power of Attorney as "ANCILLARY DOCUMENTS").
4. To execute under hand, personal seal or the common seal of the Chargor and
deliver on behalf of and in the name of the Chargor the Document and all
or any of the Ancillary Documents.
5. To make any amendments to the Document and any of the Ancillary Documents
(including any change of parties thereto) as the Attorneys or any of them
think necessary, advisable, convenient or otherwise desirable and to
approve, amend, complete, date, execute under hand, personal seal or the
common seal of the Chargor and deliver any document which effects or
otherwise evidences such amendment.
6. To do any act or other thing which the Attorneys or any of them shall
think necessary, advisable, convenient or otherwise desirable in
connection with or in relation to the transactions contemplated by the
Document and / or any of the Ancillary Documents.
- 29 -
7. To make any payment(s) and accept any payment(s) on behalf of the Chargor
which are required to be made or accepted for the purposes of the
transactions contemplated by the Documents and / or any of the Ancillary
Documents
AND IT IS FURTHER AGREED AND DECLARED THAT:
1. The Chargor hereby ratifies and confirms, and agrees to ratify and
confirm, any acts and other things whatsoever that the Attorneys or any of
them shall do or purport to do by virtue of this Power of Attorney
including (without prejudice to paragraph 3 below) any such acts and
things done between the time of revocation of this Power of Attorney and
the time of that revocation becoming known to the Attorneys.
2. The Chargor hereby authorizes and empowers the Attorneys and any of them
to acknowledge in the name and as the act and deed of the Chargor this
Power of Attorney, that this Power of Attorney has been executed as a deed
and to register and record this Power of Attorney in any office and/or
registry in any country and to procure to be done any and every other act
and thing whatsoever which may in any way be necessary, advisable,
convenient or otherwise desirable for authenticating and otherwise giving
full effect to this Power of Attorney according to the law and usages of
any country as fully and effectually as could the Chargor.
3. This Power of Attorney is irrevocable and shall remain irrevocable and in
full force and effect until such time as the Secured Obligations (as that
expression is defined in a certain share mortgage (as amended, varied,
novated or supplemented from time to time, the "SHARE MORTGAGE") dated 1
December 2006 between, among others, the Chargor and The Hongkong and
Shanghai Banking Corporation Limited have been paid, performed and
discharged in full and the Share Mortgage has been fully and irrevocably
discharged and released by The Hongkong and Shanghai Banking Corporation
Limited.
4. This Power of Attorney is coupled with an interest and is given as further
security for the due and punctual performance, payment and discharge of
the Secured Obligations (as that expression is defined in the Share
Mortgage).
5. By the execution of this Power of Attorney, the Chargor undertakes to
indemnify, and hereby indemnifies, each of the persons named above as
Attorneys (and any substitutes or delegates of such Attorneys) of the
Chargor from and against all actions, proceedings, losses, costs, damages,
expenses, claims, demands and other liabilities of any nature whatsoever
which any or all of them may suffer or otherwise incur by reason of their
acting pursuant to or in reliance on this Power of Attorney.
6. This Power of Attorney shall be governed by and construed in accordance
with the laws of the Cayman Islands.
IN WITNESS WHEREOF the Chargor has executed this Power of Attorney as a deed the
day and year first above written.
- 30 -
Executed as a deed by:
EXPERT MASTER HOLDINGS LIMITED )
in the presence of: )
)
____________________________________________________)
Address: ___________________________________________)
____________________________________________________)
Telephone: _________________________________________)
Fax: _______________________________________________)
Attention: _________________________________________)
- 31 -
SCHEDULE 0
XXXXXXXXXXX XXXXXXXXXXX XX XXXXXXXX-XX-XXXX
Dated: 1 December 2006
We, EXPERT MASTER HOLDINGS LIMITED (INCLUDING OUR SUCCESSORS, ASSIGNS AND
TRANSFEREES), hereby irrevocably appoint any officer or agent from time to time
of The Hongkong and Shanghai Banking Corporation Limited as our duly authorised
representative and attorney-in-fact to, following the occurrence of an Event of
Default (as defined in a share mortgage dated 1 December 2006 between, among
others, ourselves and The Hongkong and Shanghai Banking Corporation Limited, as
the same may be amended, varied, novated or supplemented from time to time),
sign resolutions in writing of EASTAR GROUP HOLDINGS LIMITED (the "COMPANY") in
respect of any existing or further shares in the Company which may have been or
may from time to time be issued and/or registered in our name. This power of
attorney is irrevocable by reason of being coupled with the interest of The
Hongkong and Shanghai Banking Corporation Limited as chargee of the aforesaid
shares.
IN WITNESS WHEREOF EXPERT MASTER HOLDINGS LIMITED has executed this deed of
appointment as a deed the day and year first above written.
Executed as a deed by:
EXPERT MASTER HOLDINGS LIMITED )
in the presence of: )
)
____________________________________________________)
Address: ___________________________________________)
____________________________________________________)
Telephone: _________________________________________)
Fax: _______________________________________________)
Attention: _________________________________________)
- 32 -
SCHEDULE 4
PART I
FORM OF LETTER OF RESIGNATION AND RELEASE
Date____________________
The Board of Directors
EASTAR GROUP HOLDINGS LIMITED
Codan Trust Company (Cayman) Limited
Cricket Square, Xxxxxxxx Drive, PO Box 2681
Grand Cayman KY1-1111
Cayman Islands
Dear Sirs,
RESIGNATION OF DIRECTOR
I hereby tender my resignation as a Director of the Company with effect from the
date of this resignation letter.
I confirm that I have no claims or rights of action against the Company for
compensation for loss of office.
Yours faithfully,
[DIRECTOR]
- 33 -
PART II
FORM OF LETTER OF AUTHORISATION
The Hongkong and Shanghai Banking Corporation Limited
Xxxxx 00, XXXX Xxxx Xxxxxxxx
0 Xxxxx'x Xxxx Xxxxxxx
Xxxx Xxxx
Dear Sirs,
SHARE MORTGAGE BETWEEN EXPERT MASTER HOLDINGS LIMITED (AS CHARGOR), EASTAR GROUP
HOLDINGS LIMITED (AS THE COMPANY) AND THE HONGKONG AND SHANGHAI BANKING
CORPORATION LIMITED (AS THE SECURITY TRUSTEE) DATED 1 DECEMBER 2006 (AS AMENDED,
VARIED, NOVATED OR SUPPLEMENTED FROM TIME TO TIME, THE "SHARE MORTGAGE")
I refer to my executed but undated letter of resignation as director of EASTAR
GROUP HOLDINGS LIMITED provided in accordance with the Share Mortgage and I
hereby authorise you to date the letter following the occurrence of an Event of
Default under the Share Mortgage.
Yours faithfully,
[DIRECTOR]
- 34 -
SCHEDULE 5
FORM OF UNDERTAKING TO REGISTER TRANSFERS
EASTAR GROUP HOLDINGS LIMITED
TO:
The Security Trustee (as defined in the Share Mortgage (as defined below)),
which expression shall include its successors, assigns and transferees.
Dated: 1 December 2006
Dear Sirs
EASTAR GROUP HOLDINGS LIMITED
We refer to the bond trust deed and the note trust deed each dated 1 December
2006, as amended, varied, novated or supplemented from time to time, made
between the Company, Piao Longhua, The Hongkong and Shanghai Banking Corporation
Limited as the Bond Trustee, Note Trustee and Security Trustee. We also refer to
the share mortgage dated 1 December 2006 between Expert Master Holdings Limited
as chargor (the "CHARGOR"), Eastar Group Holdings Limited and the Security
Trustee (as amended, varied, novated or supplemented from time to time, the
"SHARE MORTGAGE") whereby, inter alia, the Chargor granted a charge over the
Charged Property in favour of the Security Trustee.
Capitalised words and expressions used in this letter which are not expressly
defined herein have the meanings ascribed to them in the Share Mortgage.
This letter of undertaking is given pursuant to clause 3.3(g) of the Share
Mortgage.
The Company hereby irrevocably and unconditionally undertakes to register in the
Company's register of members any and all share transfers to or by the Security
Trustee or its nominee in respect of any or all of the Shares submitted to the
Company by the Security Trustee.
EXECUTED AS A DEED by:
EASTAR GROUP HOLDINGS LIMITED )
in the presence of )
)
____________________________________________________)
Address:____________________________________________)
____________________________________________________)
- 35 -
Telephone: _________________________________________)
Fax: _______________________________________________)
Attention: _________________________________________)
- 36 -
IN WITNESS WHEREOF the parties hereto have caused this Share Mortgage to be duly
executed as a deed the day and year first before written.
EXECUTED AS A DEED by:
EXPERT MASTER HOLDINGS LIMITED )
in the presence of )
/s/ (Seal) )
----------------------------------------------------
Address: No.38 Zhujiang Road, Waxi High & )
-------------------------------------------
New Technology Industrial Development Zing, China )
----------------------------------------------------
Telephone: 00-000-00000000-0000 )
-----------------------------------------
Fax: 00-000-00000000 )
-----------------------------------------------
Attention: _________________________________________)
EXECUTED AS A DEED by:
EASTAR GROUP HOLDINGS LIMITED )
in the presence of )
/s/ (Seal) )
----------------------------------------------------
Address: No.38 Zhujiang Road, Waxi High & )
-------------------------------------------
New Technology Industrial Development Zing, China )
----------------------------------------------------
Telephone: 00-000-00000000-0000 )
-----------------------------------------
Fax: 00-000-00000000 )
-----------------------------------------------
Attention: _________________________________________)
- 37-
EXECUTED AS A DEED )
by the Security Trustee )
in the presence of: ) Per: /s/
-----------------
) Eva X X Xxx
3266
/s/ )
-------------------------------------
Witness
Address: The Hong Kong and Shanghai Banking Corporation Limited, Xxxxx 00, XXXX
Xxxx Xxxxxxxx, 0 Xxxxxx Xxxx Xxxxxxx, Xxxx Xxxx
Telephone: N/A
Fax: x000 0000 0000
Attention: Corporate Trust and Loan Agency
EXECUTED AS A DEED )
by the Bond Trustee )
in the presence of: ) Per: /s/
-----------------
) Eva X X Xxx
3266
/s/ )
-------------------------------------
Witness
Address: The Hong Kong and Shanghai Banking Corporation Limited, Xxxxx 00, XXXX
Xxxx Xxxxxxxx, 0 Xxxxxx Xxxx Xxxxxxx, Xxxx Xxxx
Telephone: N/A
Fax: x000 0000 0000
Attention: Corporate Trust and Loan Agency
- 38 -
EXECUTED AS A DEED )
by the Note Trustee )
in the presence of: ) Per: /s/
------------------
) Eva X X Xxx
3266
/s/ )
-------------------------------------
Witness
Address: The Hong Kong and Shanghai Banking Corporation Limited, Xxxxx 00, XXXX
Xxxx Xxxxxxxx, 0 Xxxxxx Xxxx Xxxxxxx, Xxxx Xxxx
Telephone: N/A
Fax: x000 0000 0000
Attention: Corporate Trust and Loan Agency
#227506
- 39 -
EXPERT MASTER HOLDINGS LIMITED
AS "CHARGOR"
EASTAR GROUP HOLDINGS LIMITED
AS THE "COMPANY"
THE HONGKONG AND SHANGHAI
BANKING CORPORATION LIMITED
AS THE "SECURITY TRUSTEE"
THE HONGKONG AND SHANGHAI
BANKING CORPORATION LIMITED
AS THE "BOND TRUSTEE"
AND
THE HONGKONG AND SHANGHAI
BANKING CORPORATION LIMITED
AS THE "NOTE TRUSTEE"
---------------------------------------------
FIRST AMENDMENT TO THE FIRST PRIORITY SHARE MORTGAGE
IN RESPECT OF SHARES OF
EASTAR GROUP HOLDINGS LIMITED
DATED AUGUST 23, 2007
---------------------------------------------
THIS FIRST AMENDMENT TO THE SHARE MORTGAGE (the "AMENDMENT") is made on August
23, 2007
BETWEEN:
(1) Expert Master Holdings Limited (the "CHARGOR");
(2) Eastar Group Holdings Limited, an exempted company incorporated under
the laws of the Cayman Islands with company number CT-177618 (the
"COMPANY");
(3) The Hongkong and Shanghai Banking Corporation Limited as security
trustee for the Bond Trustee and the Note Trustee (the "SECURITY
TRUSTEE" which expression shall include any person for the time being
appointed as Security Trustee for the purpose of, and in accordance
with, the Bonds and the Notes);
(4) The Hongkong and Shanghai Banking Corporation Limited as trustee for
the holders of the Bonds (the "BOND TRUSTEE"); and
(5) The Hongkong and Shanghai Banking Corporation Limited as trustee for
the holders of the Notes (the "NOTE TRUSTEE").
WHEREAS:
(A) The parties have entered into a first priority share mortgage in
respect of shares of the Company on 1 December 2006 (the "SHARE
MORTGAGE");
(B) The Company will increase its share capital and offer share incentives
to certain of its employees and directors and other eligible persons;
(C) The Noteholders and Bondholders agreed to amend the Note Trust Deed and
the Bond Trust Deed to allow the issuance of share incentives to
certain of its employees and directors of the Company and other
eligible persons pursuant to the Company's share incentive plan; and
(D) The amendments to the Note Trust Deed and the Bond Trust Deed may
affect the obligations of the Chargor and the rights of the Security
Trustee under the Share Mortgage.
NOW THIS FIRST AMENDMENT TO THE SHARE MORTGAGE WITNESSETH as follows:
1. INTERPRETATION
In this Amendment, unless the context otherwise requires, words and
expressions defined in the Bond Trust Deed and the Note Trust Deed
shall have the same meaning when used in this Amendment.
2. AMENDMENT TO CLAUSE 5.3(D) OF THE SHARE MORTGAGE
Paragraph (d) of Clause 5.3 of the Share Mortgage shall be deleted and
replaced with the following:
"(d) any amendment, variation, or supplement to or waiver under the
Bonds, the Bond Trust Deed, the Notes or the Note Trust Deed,
or any other document or security, except for such amendment,
variation, or supplement to or waiver under the Bonds, the
Bond Trust Deed, the Notes or the Note Trust Deed approved by
an Extraordinary Resolution of the Bondholders and the
Noteholders;"
3. APPLICATION OF THE SHARE MORTGAGE
The provisions of Clauses 13 (Expenses), 14 (Notices) and 15
(Assignments) of the Share Mortgage shall apply to this Amendment
mutatis mutandis.
4. SHARE MORTGAGE
Except as expressly amended herein, the Share Mortgage remains in full
force and effect.
5. LAW AND JURISDICTION
5.1 GOVERNING LAW
This Amendment is governed by and shall be construed in accordance with
Cayman Islands law.
5.2 CAYMAN ISLAND COURTS
The courts of the Cayman Islands have jurisdiction to settle any
disputes (a "DISPUTE") arising out of, or connected with this Amendment
(including a dispute regarding the existence, validity or termination
of this Amendment or the consequences of its nullity) and each of the
Chargor and the Company irrevocably submits to the jurisdiction of such
courts. Each of the Chargor and the Company
agrees that the process by which any proceedings in the Cayman Islands
are begun may be served on it by being delivered to the Chargor at the
address specified in Clause 14 of the Share Mortgage.
5.3 CONVENIENT FORUM
The Parties agree that the courts of the Cayman Islands are the most
appropriate and convenient courts to settle Disputes between them and,
accordingly, that they will not argue to the contrary.
5.4 NON-EXCLUSIVE JURISDICTION
This Clause 5 (Law and Jurisdiction) is for the benefit of the Security
Trustee only. As a result and notwithstanding Clause 5.2 (Cayman Island
Courts), it does not prevent the Security Trustee from taking
proceedings relating to a Dispute in any other courts with
jurisdiction, nor shall the taking of proceedings in any one or more
jurisdictions preclude the taking of proceedings in any other
jurisdiction (whether concurrently or not) if and to the extent
permitted by law.
6. COUNTERPARTS
This Amendment may be executed in counterparts each of which when
executed and delivered shall constitute an original but all such
counterparts together shall constitute one and the same instrument.
(Signature page follows)
IN WITNESS WHEREOF for the parties hereto have caused this Amendment to be duly
executed as a deed the day and year first before written.
EXECUTED AS A DEED by:
EXPERT MASTER HOLDINGS LIMITED
In the presence of
/s/
Address:
Telephone:
Fax:
Attention:
EXECUTED AS A DEED by:
EASTAR GROUP HOLDINGS LIMITED
In the presence of
/s/
Address: 0 Xxxxxx Xxxx
Xxxxxxx, Xxxx Xxxx
Telephone: x0000000000000
Fax: x00000000000
Attention:
EXECUTED AS A DEED by:
THE HONG KONG AND SHANGHAI BANKING CORPORATION LIMITED
as Security Trustee
In the presence of Per: /s/ Eva X X Xxx
-----------------------
0000
Xxxxxxx /x/ Xxxx XX Xxxxx
000000
Address: 0 Xxxxx'x Xxxx,
Xxxxxxx, Xxxx Xxxx
Telephone: x000 00000000
Fax: x000 00000000
Attention:
EXECUTED AS A DEED by:
THE HONG KONG AND SHANGHAI BANKING CORPORATION LIMITED
as Bond Trustee
In the presence of Per: /s/ Eva X X Xxx
/s/ Xxx Twtam -----------------------
0000
Xxxxxxx /x/ Xxxx XX Xxxxx
000000
Address: 0 Xxxxx'x Xxxx,
Xxxxxxx, Xxxx Xxxx
Telephone: x000 00000000
Fax: x000 00000000
Attention:
EXECUTED AS A DEED by:
THE HONG KONG AND SHANGHAI BANKING CORPORATION LIMITED
as Note Trustee
In the presence of Per: /s/ Eva X X Xxx
-----------------------
0000
Xxxxxxx /x/ Xxxx XX Xxxxx
000000
Address: 0 Xxxxx'x Xxxx,
Xxxxxxx, Xxxx Xxxx
Telephone: x000 00000000
Fax: x000 00000000
Attention:
