EXHIBIT 10.2
COMMERCIAL VARIABLE RATE LOAN
AGREEMENT
We, NATIONAL WESTMINSTER BANK PLC and any person to whom we transfer our rights
or duties under this agreement agree to offer you a loan under the terms and
conditions set out below and on the attached appendix. The first part of the
appendix explains some of the words and phrases used in this agreement.
1 DATE OF OFFER: 29TH AUGUST 2002
2(A) YOUR NAME: PRESTOLITE ELECTRIC LIMITED (REGISTERED NO. 1189048)
XXXXXXXXX XXXX, XXXXXXX, XXXXXXX, XXXXXXXXXX, XX0 0XX.
2(B) YOUR PARENT: PRESTOLITE ELECTRIC INCORPORATED
3 LENDING BRANCH: CHELTENHAM
4 AMOUNT:(POUND)4,066,000 (FOUR MILLION AND SIXTY SIX THOUSAND POUNDS)
5 PURPOSE OF THE LOAN: CONSOLIDATE EXISTING TERM LOANS AND ONE MILLION
POUNDS OF HARDCORE FROM WITHIN THE GROUP OVERDRAFT.
6 PERIOD OF THE LOAN: FIVE YEARS
7 INTEREST RATE: You will pay interest at a rate equal to the sum of
1.375% per year plus the Bank's base rate from time to time.
8 FEE:(pound)20,000 due on the date on which you accept our offer as set
out in paragraph 3 of thE appendix.
9 DRAWING THE LOAN: You may draw the Loan in full in one amount or in
stages. If stage drawings are required, these are permitted subject to
minimum single drawings of (pound)20,000. Full drawdown must be
achieved within 12 months of the Agreement Date. If the Loan is not
drawn in full within this period, the undrawn part of the Loan will be
deemed to be cancelled and no longer available for drawing.
10 REPAYMENT: You must have repaid the Loan in full on the last day of the
period shown in term 6 of this agreement (such period commencing on the
earlier of the date on which the Loan is drawn in full and the date on
which any undrawn part of the Loan is cancelled under term 9 of this
agreement).
Subject always to our rights under paragraph 12 of the appendix,
You will repay the Loan by 60 instalments of principal and
interest payable every month. We will tell you the amounts you
need to pay to repay the Loan in full by the last day of the
period shown in term 6 of this agreement together with
interest which will be calculated in the manner referred to in
paragraph 4 of the appendix. Such instalments will commence
one month after the date on which you draw the Loan
From time to time we will tell you the instalments you must
pay.
From the date on which a drawing is first made under the Loan
until such date as you commence your instalments of principal
and interest hereunder, interest at the rate specified in this
agreement may be debited to your loan account on our usual
charging days in March, June, September and December.
1
COMMERCIAL VARIABLE RATE LOAN
11 SECURITY:
First Legal Mortgage over premises at Xxxxxx Xxxx, Xxxxx, Xxxxxx, X0
0XX.
Unlimited Composite cross guarantee structure & Mortgage debentures
between;
Prestolite Electric Limited
Prestolite Wales Limited
H B Switchgear (Contractors) Limited
12 FINANCIAL AGREEMENTS:
You agree to the following:-
PLEASE SEE paragraph 2 of the appendix for an explanation of the words
and phrases used below.
(a) You will not allow Total Borrowing to be more than 100% of Tangible Net
Worth.
(b) You will not allow Cash Generated to be less than 110% of Debt Service
Costs.
(c) You will not allow Profit to be less than 250% of Borrowing Costs.
(d) You will not allow Capital Expenditure to be more than 100% of depreciation.
(e) Any Parental Loan plus all other payments to Parent to be subordinated to
Bank Debt.
(f) Management Information to be provided monthly within 30 days of the month
end to which the informtion relates. To include Profit & Loss, Balance
Sheet, Aged Debtor Summary, Cash Flow Statements and specific commentary on
Working Capital movements.
(g) The Bank's consent must be given prior to any non-trade related payments to
the Parent or other group subsidery.
(h) No preference shares or redeemable ordinary shares to be withdrawn/repaid
during the term of this loan.
(i) Acquisitions of more than (pound)500,000 not to be made without the Bank's
prior agreement.
(j) You will not and you (and your Parent (if specified in term 2(b)) will
procure that none of your (or if your Parent is specified in term 2(b) its)
subsidiary undertakings as defined by S. 258 of the Companies Xxx 0000
("Subsidiary Undertakings") will, without our prior written consent either
create, extend or increase any security interest on the whole or any part of
your or the Group's undertaking, property or assets (including uncalled
capital) whether present or future. Security interest includes (without
limitation) liens, pledges, charges, mortgages or other encumbrances.
(k) You will provide us with such financial and other information relating to
you or to the Group as we may reasonably require including (without
limitation) copies of the consolidated audited accounts of the Group not
later than six months after the end of the accounting period to which they
relate.
In order to verify whether you are complying with these covenants, we
will refer to your management accounts on a quarterly basis and audited
on an annual basis, for the consolidated accounts of Prestolite
Electric Limited.
In respect of the Cash Generated and Profit agreements (b & c detailed
above), these will be tested quarterly on a tweleve month rolling basis
(i.e. March to March, June to June, September to September and December
to December).
2
COMMERCIAL VARIABLE RATE LOAN
13 OVERDUE PAYMENTS:
If you do not make any payment under this agreement on the date it is
due, then, without prejudice to our other rights, we will charge
interest on the overdue amount from the date it was due to the date
upon which we receive payment (as well after as before judgement). This
will be calculated (and compounded in accordance with our normal
practice) on the basis of a year of 365 days and the actual number of
days elapsed.
You will pay interest to us at a rate which is equal to the sum of:-
5% per year; and
our base rate from time to time
Any late payments may be debited to a separate account.
14 EARLY REPAYMENT:
Paragraph 7 of the appendix gives details of how you may ask to repay
the Loan before the specified repayment dates. In connection with
paragraph 7 of the appendix, the prepayment fee is 0.5% of the amount
which you prepay.
15 ENVIRONMENTAL LIABILITIES
Paragraph 18 of the Appendix will apply.
16 Prestolite Electric Incorporated, a corporation incorporated under the
laws of the State of Delaware in the United States of America
("Prestolite US"), joins in the execution of this Loan Agreement for
the purpose of confirming its acknowledgement of and agreement with the
terms and conditions of this Loan Agreement.
Prestolite US is the primary Obligor. National Westminster Bank Plc,
Prestolite UK and Prestolite US acknowledge and agree as follows with
respect to the Loan established by this Loan Agreement;
Prestolite US is the primary obligor with respect to the Loan, not
withstanding any other provision of this Loan Agreement, which
may imply otherwise.
As a matter of administrative convenience, Prestolite US has determined
that its wholly owned subsidiary, Prestolite UK, will service
the Loan as an accommodation to Prestolite US.
For purpose of Prestolite US's Senior Note Indenture, the Loan is
intended to and shall be deemed to be "Indebtedness" permitted
by Section 4.3.b (ix) of such Senior Note Indenture.
The above will not prejudice the rights and actions of National
Westminster Bank Plc to exercise the terms & conditions of the Loan
Agreement with Prestolite Electric Limited.
3
COMMERCIAL VARIABLE RATE LOAN
APPENDIX
1 AGREEMENT
This appendix forms part of the agreement between us.
If we refer to a paragraph, this will mean a paragraph of this
appendix. If we refer to a term this will mean a term of the
agreement.
2 MEANINGS AND WORDS AND PHRASED USED IN THIS AGREEMENT
THE 'AGREEMENT DATE' means the date on which our offer is accepted
in the way set out in paragraph 3 of the appendix.
'BUSINESS DAY' shall mean a day on which banks in general are open
in the City of London for the transaction of business of the
nature set out in this agreement.
'EVENT OF DEFAULT' shall mean any event specified in paragraph 12
of the appendix.
'THE GROUP' means you and your (or where your Parent is specified
in term 2(b) your Parent and its) subsidiary undertakings (as
defined by Section 258 of the Companies Act 1985) taken as a whole
(and, save where the context does not admit, any of them
individually); if there are no subsidiary undertakings for the
time being, references to the Group shall be taken to be
references to you and the word "consolidated" in relation to any
accounts or other financial matters shall be ignored.
THE 'LOAN' means the loan facility which we have agreed to provide
under the terms and subject to the conditions of this agreement
and, where necessary, it will mean all amounts owed under this
agreement.
'YOUR PARENT' is the company shown in term 2(b) of the agreement
'THE OFFER DATE' is the date shown in term 1 of the agreement.
This is the date on which we make the written offer of the Loan.
'SECURITY' means the security shown in term 11 of the agreement
and any other security which you provide under paragraph 5 of the
appendix.
'SUBSIDIARY UNDERTAKING' shall mean a subsidiary undertaking (as
defined by S.258 of the Companies Act 1985).
The following definitions apply to the financial agreements in
term 13 of the agreement.
'BORROWING COSTS' means, in respect of any financial period, all
continuing, regular or periodic costs, charges and expenses
(including but not limited to, interest and any capitalised
interest) incurred by the Group in effecting, servicing or
maintaining Total Borrowing.
'CAPITAL EXPENDITURE' means, in respect of any financial period,
the aggregate expenditure of the Group on the purchase of fixed
assets (as determined in accordance with generally accepted United
Kingdom accounting principles (consistently applied)).
4
COMMERCIAL VARIABLE RATE LOAN
'CASH GENERATED' means, in respect of any financial period, the
sum of:-
(i) Profit; plus
(ii) an amount equal to the depreciation charged on fixed
assets of the Group during such period and any other non-cash
movements; plus
(iii) an amount equal to any decrease in net working capital
(being, in respect of any period, the net surplus (or deficit)
of the aggregate stock in trade of the Group and the amount
owed to members of the Group by debtors less the amount owed
by them to creditors at the end of such period); plus
(iv) the proceeds of new ordinary or other non-redeemable
shares issued by you during such period
LESS the sum of:-
(i) an amount equal to the tax paid by the Group during such
period; plus
(ii) an amount equal to any increase in net working capital
(as defined above) during such period; plus
(iii) an amount equal to the Capital Expenditure (including
investments) by the Group during such period less an amount
equal to the net proceeds of disposal of fixed assets during
such period; plus
(iv) an amount equal to the aggregate amount of dividends on
ordinary shares paid by you during such period; plus
(v) any receipts of the Group by way of extraordinary items
during such period;
'CURRENT ASSETS' means all assets of the Group which would be
classified, in accordance with generally accepted United Kingdom
accounting principles (consistently applied) as current assets.
'CURRENT LIABILITIES' means all liabilities of the Group which
would be classified, in accordance with generally accepted United
Kingdom accounting principles (consistently applied) as current
liabilities.
'DEBT SERVICE COSTS' means in respect of any financial period :-
(i) all interest, commission, periodic fees and other
financial charges payable by any member of the Group during
such period (including the interest element payable under
finance leases) ; plus
(ii) the aggregate amount of all dividend payments on
redeemable preference shares (and other shares) made by you
during such period; plus
(iii) the aggregate amount of all debt repayments made by any
member of the Group or due from any member of the Group
(including redemption of any redeemable preference shares)
during such period;
5
COMMERCIAL VARIABLE RATE LOAN
'NET CASH FLOW BEFORE FINANCING' means, in respect of any
financial period, the sum of :-
(i) Profit; plus
(ii) an amount equal to the depreciation charged on fixed
assets of the Group during such period and any other non-cash
movements during such period; plus
(iii) an amount equal to any decrease in net working capital
(being, in respect of any period, the net surplus (or deficit)
of the aggregate stock in trade of the Group and the amount
owed to members of the Group by debtors less the amount owed
by them to creditors at the end of such period);
LESS the sum of :-
(i) an amount equal to the tax paid by the Group during such
period; plus
(ii) an amount equal to any increase in net working capital
(as defined above) during such period; plus
(iii) an amount equal to the Capital Expenditure (including
investments) by the Group during such period less an amount
equal to the net proceeds of disposal of fixed assets during
such period; plus
(iv) an amount equal to the interest paid (less interest
received) by the Group for such period;
(v) an amount equal to the aggregate amount of dividends on
ordinary shares paid by you during such period; plus
(vi) any receipts of the Group by way of extraordinary items
during such period.
'NET WORKING ASSETS' means, in respect of any period, the
aggregate stock in trade of the Group and the amounts owed to
members of the Group by trade debtors less the amounts owed by
them to trade creditors at the end of such period.
'PROFIT' means, in respect of any financial period, the amount
of profit of the Group (excluding profit attributable to minority
interests) before taxation, interest payable, and any unusual,
extraordinary or exceptional items.
'TANGIBLE NET WORTH' means the amount for the time being paid up
or credited as paid up on your (or where your Parent is specified
in term 2(b), your Parent's) issued share capital plus all
reserves of the Group which would, in accordance with generally
accepted United Kingdom accounting principles consistently applied
be classified as shareholders capital plus retained earnings but
deducting assets of the Group which would, in accordance with such
principles, be classified as intangible assets.
'TOTAL BORROWING' means the total outstanding principal amount
of all borrowings or monies otherwise raised by the Group from all
sources whatever, whether by way of debenture, mortgage, unsecured
loan, overdraft or in any other manner (including redeemable
preference shares) plus the aggregate face amount of all
discounted acceptance credits.
3 AVAILABILITY OF LOAN
From the Agreement Date you will have 12 months in which you can
draw the Loan.
6
COMMERCIAL VARIABLE RATE LOAN
However, you can only accept this offer and draw the Loan if we
have received the following items from you and are satisfied with
them:-
a)A copy of this agreement with the acceptance form signed on
your behalf (and if your Parent is specified in term 2(b) on
behalf of your Parent).
b)A certified copy of a resolution of your board of directors
(and if your Parent is specified in term 2(b) a certified copy
of a resolution of its board of directors) showing that you
(and if applicable your Parent)
- accept the terms and conditions of the Loan;
- agree to give the security set out in term 11 of the
agreement; and
- authorise a person or persons to take such other
action on your behalf (and if applicable your
Parent's behalf) as may be necessary for the purpose
of the agreement.
You must give us three days' notice of your intention to draw the
Loan or any part of it. These days must be Business Days. We will
repay the existing loans and consolidate one million of the group
overdraft hardcore.
ACCEPTANCE OF THE OFFER CONTAINED IN THIS AGREEMENT MAY BE
EFFECTED BY RECEIPT BY US AT THE LENDING BRANCH (PLEASE SEE TERM 3
OF THE AGREEMENT) WITHIN THIRTY DAYS OF THE DATE SPECIFIED IN TERM
1 OF THE AGREEMENT OF THE ITEMS SPECIFIED IN THIS PARAGRAPH.
4 INTEREST
We will work out interest on the balance of the Loan outstanding
from day to day on the basis of the actual number of days elapsed
and a 365 day year.
You must pay interest to us on our usual charging days in March,
June, September and December or by combined interest and principal
instalments (where specified under term 10) on such dates as are
specified under term 10 of the agreement.
You will pay interest at the rate shown in term 7 of the
Agreement.
We may charge interest to your current account or to your loan
account.
If you do not make any payments on the due date under this
agreement, then the rate of interest specified in term 14 shall
apply to any overdue amounts.
5 SECURITY
You must give us the security shown in term 11 of the agreement
and this will be a continuing security for the discharge on demand
of all your indebtedness and your other liabilities to us from
time to time.
The open market value of the Security shall be determined at our
option from time to time by an independent professional valuation.
You will have to pay for this valuation.
6 FEES AND COSTS
We have the right to debit your current account with the fees set
out in term 8 and 15 of the agreement.
7
COMMERCIAL VARIABLE RATE LOAN
7 EARLY REPAYMENT
We may (but are not obliged to) agree to let you repay the Loan
early if you ask us in writing. You must give us five days notice
in writing to do this. This notice shall be irrevocable and these
days must be Business Days. If we allow you to repay the Loan
early, the prepayment will be on such terms as we may require
including (without limitation) you indemnifying us against any
funding or other costs, losses, expenses or liabilities (including
loss of profit) sustained or incurred by us as a result of such
prepayment.
If we allow you to repay the loan early you will also have to pay
us the prepayment fee set out in term 15 of the agreement.
You cannot reborrow any amount you have prepaid.
8 LIABILITY
If you are more than one person then the expression "you" shall
mean all of such persons and (save where the context does not so
admit) any of them and the obligation of those persons shall be
joint and several.
Each such person irrevocably appoints each other person as his
agent for the service of any demand or notice under this
agreement.
9 CURRENT ACCOUNTS
You agree to maintain a current account with us throughout the
period of the Loan.
10 PAYMENTS
We may transfer amounts from your current account to meet the
repayments set out in term 10 of the agreement.
We may use any repayment instalment (including instalments of
principal and interest) or any part of any repayment instalment
to:
- reduce the amount of principal outstanding on the Loan.
- pay interest accrued on the Loan.
- discharge any other payment due under this agreement.
You must make all payments under this agreement in full in pounds
sterling without any deduction or withholding (whether in respect
of set-off, counterclaim, duties, taxes, charges or otherwise
howsoever). If you are compelled by law to make any deduction or
withholding, you will promptly pay to us such additional amounts
as will make the net amount received by us equal to the full
amount payable by you had there been no deduction or withholding.
11 SET-OFF
We shall be entitled to set-off against any of your liabilities to
us under this agreement (whether present, future, actual or
contingent) any of your credit balances on any of your accounts
with us or in your name. We do not have to give you any prior
notice to do this.
12 DEFAULT
If any of the following events occur, WE MAY, by giving you
written notice, cancel our outstanding commitments to you
(including the availability of the Loan if you have not drawn it
in full) and demand immediate repayment of your indebtedness to us
and exercise our rights under any Security:-
8
COMMERCIAL VARIABLE RATE LOAN
(a) If you breach any term or condition (including any covenant)
of this agreement.
(b) If you do not make any payment on the date it is due under
this agreement and whether by way of principal, interest or
otherwise.
(c) If you do not use the Loan for the purpose set out in term 5
of the agreement.
(d) If the Security or any part of the Security shall cease to be
fully enforceable in accordance with its terms or with effect
from the date on which the determination of the continuing
nature of the Security or any part thereof occurs, such
continuing nature is determined whether such determination be
by actual or constructive notice or be deemed to have
occurred or any binding undertaking provided in the Security
or any part of the Security shall be breached or any
guarantor gives or purports to give notice to terminate its
liabilities under any guarantee in respect of the Loan.
(e) If you sell or dispose of any asset listed in term 11 of the
agreement or it ceases to be in your sole possession.
(f) If your current account becomes overdrawn after the debiting
of any payment due from you under the Loan or it becomes
overdrawn in excess of any limit agreed with us and you do
not offer payment in cash to us when we inform you of this.
(g) If any representation, warranty or statement made to us by
you in connection with the Loan is breached or is false or if
you fail to tell us anything which in our opinion is material
to the Loan.
(h) If you or any member of the Group make any default in the
performance of any other agreement for borrowed money whether
with us or any other lender whereby the due date of repayment
thereunder is rendered capable of acceleration; or
if any of your indebtedness or the indebtedness of any member
of the Group becomes or is declared by the holder or the
lender thereof to be due and payable prior to its stated
maturity or such indebtedness is not repaid in full at its
stated maturity; or
if such indebtedness (including the indebtedness of any
member of the Group) is repayable on demand and is not repaid
in full immediately upon demand being made or if any
guarantee or indemnity given by any giver of security in
connection with any of your liabilities to us or any other
lender is not honoured when due and called upon.
(i) If a petition is presented or a resolution passed for your
winding up or that of any member of the Group or a petition
is presented for an administration order to be made in
relation to you or any member of the Group; or
your directors or the directors of any member of the Group
make a proposal for a voluntary arrangement with your
creditors or the creditors of any member of the Group; or
you are unable to pay your debts within the meaning of
Section 123 of the Insolvency Xxx 0000 or any member of the
Group is unable to pay its debts within the meaning of such
section or an encumbrancer takes possession of or a receiver
or an administrative receiver is appointed over any of your
assets or over the assets of any member of the Group;
(j) If there shall occur in our opinion a material effective
change of control (as defined by Section 840 of the Income
and Corporation Taxes Act 1988) of you or your Parent;
(k) If there has occurred any change which in our reasonable
opinion is a material adverse change in your business, assets
or financial condition or in the business, assets or
financial condition of the Group or any member of the Group
which, in our
9
COMMERCIAL VARIABLE RATE LOAN
reasonable opinion, may affect your ability to comply with
your obligations under this agreement.
(l) If any judgement, distress, warrant of attachment, writ of
execution or similar process is issued, levied or enforced
upon any of your assets or the assets of any member of the
Group or if any asset held by the Bank as security for the
Loan is charged or becomes encumbered elsewhere.
(m) If you or any member of the Group ceases or threatens to
cease to carry on its business or sells, transfers or
otherwise disposes of in any one transaction or series of
related transactions any substantial part of its assets.
(n) If you cease to be a Subsidiary Undertaking of your Parent
("Prestolite Electric Holding Incorporated").
13 DELAY IN EXERCISING OUR RIGHTS
If we delay in giving any notice or exercising any of our rights
under this agreement this should not be construed as a waiver of
any of our rights.
14 DEMANDS AND NOTICES
Any demand or notice to you will be made in writing and be signed
by one of our officers and served either by personal delivery on
you at any place or by post addressed to you at your place of
business last known to us.
Service by post on you shall be deemed to be effective on the next
Business Day after the date of posting even if it is returned
undelivered.
Any notice to us under this agreement must be made in writing and
signed by you or where you are a company, by a duly authorised
officer on your behalf. It must be delivered by hand or by post to
the Lending Branch specified in term 3 of the agreement.
15 COSTS AND EXPENSES
You will pay all costs, charges and expenses arising in connection
with the Loan and the Security including the negotiation and
preparation of this agreement and the Security and all costs,
charges and expenses arising in connection with the preservation
and/or enforcement of our rights under this agreement or under the
Security and will indemnify us for any and all losses, costs and
expenses occasioned by the occurrence of an Event of Default.
16 GENERAL POINTS
(a) If at any time any one or more of the provisions in this
agreement is or becomes invalid, illegal or unenforceable in any
respect, the validity, legality or enforceability of the remaining
provisions hereof shall not in any way be affected or impaired
thereby.
(b) Unless we expressly agree to do so in writing we do not hold
ourselves out as providing advice on or considering the general
suitability of this Loan for your particular circumstances
(including tax circumstances ) and neither we nor our employees
shall be liable for any indications given as to such suitability.
We make no warranties or representations about the advisability of
any underlying transaction entered into by you. You should obtain
independent professional advice on such matters and upon any
Security required by us.
(c) If we determine in our opinion that as a result of any
Requirement or compliance by us with any Requirement the cost to
us of funding, maintaining or making available the
10
COMMERCIAL VARIABLE RATE LOAN
Loan (or any undrawn amount of the Loan) is increased or the
effective return to us on the Loan or on our capital is reduced,
then you shall pay to us on demand such sums as may be certified
to you by us as shall compensate us for the increased cost or
reduction. `Requirement' means any law, regulation, directive or
official request (whether or not having the force of law) and
includes any change in its interpretation or application. It also
includes any Requirement relating to a change in currency of a
country.
(d) If more than one currency or currency unit are at the same
time recognised by the Bank of England as the lawful currency of
the United Kingdom then:
any reference in this agreement to, and any obligations arising
under this agreement in, the currency of the United Kingdom shall
be translated into, or paid in, the currency or currency unit of
the United Kingdom designated by us; and
any translation from one currency or currency unit to another
shall be at the official rate of exchange recognised by the Bank
of England for the conversion of that currency or currency unit
into the other, rounded up or down by us acting reasonably.
(e) If a change in any currency of the United Kingdom occurs, this
agreement will be amended to the extent we specify to be necessary
to reflect the change in currency and to put us in the same
position, so far as possible, that we would have been in if no
change in currency had occurred.
(f) We may assign or transfer all or any of our rights and
obligations under the Loan. You may not assign or transfer any of
your rights or obligations under the Loan.
(g) This agreement is governed by the laws of England.
(h) All expressions in this letter bearing a plural meaning shall
(where the context so admits) also bear the singular meaning and
vice versa.
(i) All references in this letter to any statutory provision shall
be deemed to include any statutory modification or re-enactment of
such provision.
(j) If the effect of the introduction of or any change in
applicable law or directive or the interpretation of such law or
directive is to make or purport to make the Loan unlawful then our
obligations under this agreement shall cease and you will on
demand pay to us all amounts outstanding under the Loan.
17 REPRESENTATIONS AND WARRANTIES
You represent and warrant that you have full power to accept and
be bound by the terms and conditions set out in this agreement and
to draw the Loan and that you have taken all necessary steps and
obtained all necessary consents and authorisations to do so and
that accordingly this agreement constitutes your legal, valid and
binding obligations fully enforceable in accordance with their
terms.
You represent and warrant as follows:-
(a) You are duly incorporated and validly existing under the laws
of England.
(b) No Event of Default has occurred or is outstanding and no
event has occurred which with the giving of notice or the
lapse of time would constitute an Event of Default.
(c) All information, exhibits and reports furnished to us in
connection with this agreement were and remain true and
accurate in all respects and do not omit any facts thereby
rendering misleading any statement contained therein.
(d) The representations and warranties set out above shall survive
your acceptance of this agreement and the drawing of the Loan
and shall be deemed to be repeated on each
11
COMMERCIAL VARIABLE RATE LOAN
day throughout the period of the Loan with reference to the
facts and circumstances existing at that time.
18 ENVIRONMENTAL MATTERS
(a) We may at any time during the period of the Loan require you
to obtain a written up-date of the environmental audit referred to
in paragraph 3 of the appendix (or if no audit was required under
paragraph 3, a written confirmation that neither your assets nor
the use of those assets has broken or is likely to break any
Environmental Law). This must be done by an environmental
consultant acceptable to us and at your expense.
b) You must notify us immediately if you receive any claim, notice
or other communication in respect of any alleged breach of
Environmental Law.
(c) You undertake to notify us immediately if any Environmental
Licence is withdrawn or is not renewed.
(d) You must give us certified copies of any new Environmental
Licence and any renewal of any Environmental Licences within
twenty-eight days of issue and you must meet all associated costs
and expenses.
(e) You represent and warrant to us that you have obtained all
necessary Environmental Licences and you have at all times
complied in all material respects with the terms and conditions of
the Environmental Licences applicable to you and all other
applicable Environmental Law. You also confirm that no Hazardous
Materials (other than those incidental to your business and which
are stored in full compliance with Environmental Licence(s)) have
been used, disposed of, generated, stored, transported, deposited,
buried or emitted at, on, from or under any premises (whether or
not owned, leased, occupied or controlled by you) in circumstances
where this might result in a liability on you.
(f) You represent that you have not received any notices of
withdrawal, violations and/or advisory action by regulatory
agencies regarding environmental control matters or Environmental
Licence compliance.
(g) You will indemnify and hold us and our respective officers,
directors, employees and agents (the 'Indemnified Parties') free
and harmless from and against any and all actions, causes of
action, losses, costs, liabilities and damages of any kind and
every kind of character known or unknown, fixed or contingent, out
of pocket or consequential and all expenses incurred in connection
therewith including reasonable legal fees and disbursements
irrespective of whether any such Indemnified Parties are a party
to the action for which indemnification is sought) (the
"Indemnified Environmental Liabilities") incurred by the
Indemnified Parties or any of them as a result of or arising out
of or relating to:-
(i) The imposition or recording of any liens, pledges, charges or
mortgages on or over any of your assets by any government
agency or local governmental agency or authority pursuant to
any Environmental Law or the removal of any such liens,
pledges, charges or mortgages over any of your assets.
(ii) The claims of any private parties or local government or
government agency or authority regarding violations of
Environmental Law in connection with your operations or the
effect of the presence of any Hazardous Material on the value
of the assets belonging to you or in connection with
compliance by you or the Indemnified Parties with any
regulation or order issued pursuant to Environmental Law.
Your obligations to the Indemnified Parties shall continue
after you have repaid the Loan. For the purposes of this
agreement:-
12
COMMERCIAL VARIABLE RATE LOAN
"Environmental Law" shall mean any law, regulation, code of
practice, circular, guidance notes or the like (whether in the
United Kingdom or elsewhere and whether now existing or
subsequently enacted or promulgated) or any judicial or
administrative interpretation thereof concerning the protection of
human health or the environment or the conditions of the work
place or the generation, transportation, storage, treatment and
disposal of hazardous materials.
"Hazardous Materials" shall mean any radioactive emissions and any
natural or artificial substance (whether in solid or liquid form
or in the form of a gas or vapour and whether alone or in
combination with any other substance) which are defined,
determined identified prohibited, limited or regulated by
Environmental Law or any other chemical, material, substance or
element existing now or in the future and which is capable of
causing harm to man or any other living organism which is capable
of damaging the environment or public health or welfare including
any controlled, special, dangerous, toxic, radioactive or
hazardous waste.
"Environmental Licence" shall mean any permit, licence or
authorisation, consent or other approval required by Environmental
Law.
------------------------------------
For and on behalf of
National Westminster Bank Plc
Date
--------------------------------
13
COMMERCIAL VARIABLE RATE LOAN
FORM OF ACCEPTANCE
We accept the Loan on the terms and conditions set out in this letter
By:
-------------------------------------------------------
For and on behalf of Prestolite Electric Limited
Date:
------------------------------------------------------
By:
-------------------------------------------------------
For and on behalf of Prestolite Electric Incorporated
Date:
------------------------------------------------------
14
