EXHIBIT 10.22
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LOAN AGREEMENT
THIS LOAN AGREEMENT (this "Agreement") is made and entered into as of
September 2, 1999, by and between United International Properties, Inc., a
Colorado corporation ("United"), and Xxxx X. Xxxxxxxxx, an individual residing
in London, England ("Borrower").
RECITAL
A. Borrower is a director of United and a managing director and the chief
executive officer of United Pan-Europe Communications N.V., a Dutch
corporation and a subsidiary of United ("UPC").
B. Borrower has purchased residential property located at 00 Xxxxxxxxxx
Xxxxxxx, Xxxxxx, Xxxxxxx XX0 0XX (the "Property"), as his personal
residence in London.
C. In connection with the purchase of the Property, Borrower required
additional financing of up to US$1,200,000.00 and United made a loan to
Borrower on September 2, 1999, in the principal amount of US$723,356.37
(the "Loan"), on the terms and conditions set forth herein, in order to
fund a portion of the purchase price.
D. Borrower has financed a portion of the purchase price with loans in the
original principal amount of (pound)3,200,000 and (pound)800,000,
respectively (the "FleetBoston Loans"), from FleetBoston Financial
(Guernsey) Limited (f.k.a. BankBoston Guernsey Limited, "FleetBoston"). One
of the FleetBoston Loans is secured by a first charge in favour of
FleetBoston on the Property. The documents governing, evidencing and
securing the FleetBoston Loans are referred to herein as, the "Bank
Documents".
E. This Agreement evidences and confirms the terms and conditions on which
United made the Loan to Borrower.
NOW, THEREFORE, the parties hereto hereby agree as follows:
Article I
AMOUNT AND TERMS OF THE LOAN
1.1 LOAN. The principal amount of the Loan is Seven Hundred Twenty-three
Thousand Three Hundred Fifty-six Dollars and Thirty-seven Cents
(US$723,356.37). The Loan is evidenced by a Promissory Note of even date
herewith (the "Note"). The Note has been executed and delivered to United
in connection with the execution and delivery of this Agreement.
1.2 INTEREST. The principal balance of the Loan outstanding from time to time
shall bear interest at the annual rate of nine percent (9%), calculated on
the basis of a year of 360 days and actual number of days elapsed, from
September 2, 1999, until and through the date the principal of the Loan is
paid in full.
1.3 INTEREST PAYMENTS. Borrower shall pay interest on the Loan in arrears in
immediately available funds on the last day of each month commencing
September 30, 1999, and at maturity. Pursuant to an agreement among United,
UPC and Borrower, UPC pays Borrower an expat allowance in the amount of
(pound)5,633 per month. Borrower hereby agrees that such allowance shall be
paid to United and applied by United toward the payment of interest on the
Loan as the same becomes due from time to time. Borrower shall instruct UPC
in writing to make such payments to United.
1.4 MATURITY DATE. The outstanding principal amount of the Loan, together with
all accrued and unpaid interest thereon, shall be due and payable on the
earlier of the following: (a) the date on which Borrower sells or transfers
any legal or beneficial interest in the Property; (b) the date on which
Borrower is no longer an employee of United, UPC or any affiliate thereof;
or (c) the date on which an Event of Default (as defined below) has
occurred.
1.5 SECURITY.
(a) The Loan shall be secured by (i) a second mortgage on the Property,
(ii) contractual rights entitling United to require Borrower to
exercise vested stock options with positive value, as designated by
United from time to time, that Borrower holds from time to time in
United, UPC, chello broadband N.V. or any of their affiliates, (iii) a
security interest in any shares of such stock that Borrower acquires
and (iv) a security interest in any of the proceeds from the sale of
any such shares of stock. The documents from time to time effecting
and documenting the foregoing security are referred to herein as, the
"Security Documents";
(b) Borrower agrees to use his best efforts to obtain, and to co-operate
and assist United in obtaining, the consent of FleetBoston, the holder
of the first charge on the Property, to allow United to place a second
mortgage on the Property. Borrower agrees United may contact
FleetBoston directly concerning its consent to the second mortgage.
Upon receipt of such consent, Borrower will immediately execute the
documents necessary to effect and document such mortgage.
(c) Other than as stated in this Section 1.5, the Loan shall be
non-recourse to Borrower or any other assets of Borrower.
1.6 PREPAYMENTS. Borrower may prepay the outstanding and unpaid amount of the
Loan in whole or in part at any time without premium or penalty.
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1.7 TAXES. All payments made under this Agreement to United will be made
without withholding or deduction for or on account of any present or future
taxes, duties, assessments or governmental changes of whatever nature.
Borrower shall promptly pay any stamp duty or other charges payable in
connection with the Loan or any of the documents evidencing or governing
the Loan, and he shall indemnify and hold United harmless from all such
taxes, duties, assessments and governmental changes of whatever nature.
Article II
REPRESENTATIONS AND WARRANTIES
Borrower hereby represents and warrants to United, as of the date of this
Agreement and the date on which Borrower executes this Agreement, as follows:
2.1 AUTHORITY. Borrower is an individual who has full power and authority to
enter into this Agreement, the Note and the Security Documents
(collectively, the "Loan Documents"), to perform his obligations under the
Loan Documents and to consummate the transactions contemplated thereby.
2.2 ENFORCEABILITY. The Loan Documents are, or when executed and delivered by
Borrower will be, legal, valid and binding obligations of Borrower,
enforceable against Borrower in accordance with their respective terms,
except to the extent enforcement may be limited by applicable bankruptcy,
insolvency, reorganization and other similar laws and except that the
availability of equitable remedies, including specific performance, is
subject to the discretion of the court before which any proceeding may be
brought.
2.3 NO CONFLICT. The execution and delivery by Borrower of the Loan Documents
and consummation of all the transactions contemplated thereby do not and
will not conflict with, or be in contravention of, any law, order, rule or
regulation applicable to Borrower or any agreement or instrument to which
Borrower is a party or by which Borrower is bound or affected.
2.4 OTHER AGREEMENTS. Borrower is not a party to any indenture, loan or credit
agreement or to any lease or other agreement or instrument that could have
a material adverse effect on the ability of Borrower to carry out his
obligations under the Loan Documents. Borrower is not in default in any
material respect in the performance, observance, or fulfilment of any of
the obligations, covenants, or conditions contained in the Loan Documents
or the Bank Documents.
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2.5 TITLE, ETC. Title to and legal and beneficial ownership in the Property
and to the contract rights, shares of stock and proceeds referred to in
Section 1.5 above (collectively, the "Collateral"), is (or will be with
respect to Collateral hereafter acquired) vested solely in Borrower
free and clear of all liens, encumbrances and other claims whatsoever,
except for the first charge on the Property created by the Bank
Documents and except as granted by the Loan Documents. Borrower has
made no contract or arrangement of any kind the performance of which by
another party could give rise to a lien or security interest in the
Collateral other than the first charge on the Property created by the
Bank Documents.
2.6 USE OF FUNDS. Borrower has used the proceeds from the Loan solely towards
the purchase price of the Property.
Article III
COVENANTS OF BORROWER
Borrower covenants that until such time as all of the obligations under the
Loan Documents are indefeasibly paid or satisfied (except that, in respect of
Section 3.5, Borrower's obligations shall survive the payment of all amounts due
under the Loan Documents in the event such payment precedes the sale of the
Property):
3.1 VALUE OF THE COLLATERAL. Borrower shall not cause or suffer to be caused
any act whereby the value of any of the Collateral might be, in United's
reasonable opinion, materially and adversely lessened.
3.2 MAINTENANCE OF PROPERTY. Borrower shall pay all operating and routine
maintenance costs of the Property, including but not limited to utilities,
maid, taxes, telephone, furnishings (including furnishings owned by
United), decorating costs, required repairs and landscaping.
3.3 PAYMENT OF TAXES, ETC. Borrower shall duly and punctually pay and discharge
all taxes, assessments and other charges imposed upon the Collateral prior
to the date when the same shall become delinquent and shall duly and
punctually pay the principal and interest on all Borrower's debt
obligations that are secured by the Collateral.
3.4 SALE OF PROPERTY. If Borrower sells or transfers any legal or beneficial
interest in the Property, Borrower shall notify United at least 30 days
prior to the closing on such sale or transfer, and Borrower shall cause the
proceeds from such sale to be applied as follows: (a) first, to the payment
in full of all amounts due under the Bank Documents, (b) second, to the
payment of all amounts due under the Loan Documents, (c) third, to
reimburse Borrower for any additional principal payments made under the
Bank Documents, and (d) finally, with respect to all remaining proceeds, to
United.
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3.5 INDEMNIFICATION. Borrower shall indemnify, defend and hold harmless United,
its officers, directors and affiliates, and its and their successors and
assigns (the "Indemnified Parties") from, against and in respect of any
damages, claims, losses, charges, actions, suits, proceedings,
deficiencies, interest, penalties and reasonable costs and expenses
(including but not limited to reasonable attorneys' fees and expenses of
investigating, preparing and defending against or prosecuting any
litigation or claim indemnified against under this Agreement) imposed on,
sustained, incurred, or suffered by or asserted against any of the
Indemnified Parties, directly or indirectly relating to or arising out of
the failure of any representation or warranty made herein by Borrower to be
true and correct in all material respects on the date of this Agreement and
any breach by Borrower of any of his covenants herein, or otherwise
relating to or arising out of the Loan Documents.
3.6 COSTS, EXPENSES AND OTHER CHARGES. Borrower shall pay on demand all costs
and expenses of United, and fees and disbursements of counsel (including
allocated costs of internal counsel), in connection with the preparation of
the Loan Documents; any Event of Default; the enforcement or attempted
enforcement of, and preservation of any rights under, the Loan Documents;
any out-of-court workout or other refinancing or restructuring or any
bankruptcy case relating to Borrower or the Collateral; and the
presentation of and realization upon any of the Collateral, including any
losses, costs and expenses sustained by United as a result of any failure
by Borrower to perform his obligations contained in the Loan Documents.
3.7 BANK DOCUMENTS. Borrower shall timely observe and perform all of his
obligations under the Bank Documents.
3.8 NEGATIVE COVENANTS. Borrower shall not incur, assume, or become liable with
respect to any indebtedness on the Collateral other than indebtedness
incurred pursuant to the terms of the Bank Documents or pursuant to the
terms of this Agreement, and Borrower shall not create or incur any
mortgage, pledge, lien, charge or encumbrance on, or security interest in,
the Collateral, except as contemplated by the Bank Documents and the Loan
Documents.
3.9 ADDITIONAL CONDITIONS. Prior to or simultaneous with the execution of this
Agreement, Borrower shall:
(a) furnish to United a true and correct copy of the Bank Documents and
all other documents related thereto;
(b) execute and deliver to United, in form and substance satisfactory to
United, the Security Documents (excluding the documents with relation
to the second charge on the Property, which documents shall be
delivered as soon as practical after the date of this Agreement); and
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(c) execute and deliver to UPC, in form and substance satisfactory to
United, a letter authorizing United to withhold Borrower's foreign
housing and expense allowance as payment of interest on the loan.
Article IV
EVENTS OF DEFAULT
4.1 EVENTS OF DEFAULT. If any of the following events (each such event being
and referred to herein as an "Event of Default") occurs:
(a) Borrower fails to pay the principal of or interest on the Loan when
the same becomes due and payable;
(b) any representation or warranty made or deemed made by Borrower in any
of the Loan Documents proves to have been false, incorrect, incomplete
or misleading in any material respect on the date made or deemed made;
(c) Borrower fails to perform or observe any covenant under Article III of
this Agreement or fails in any material respect to perform or observe
any other term, covenant, or agreement contained in this Agreement or
any other of the Loan Documents;
(d) Borrower (i) fails to make any payment of any principal of, or
interest on, the FleetBoston Loans or any other indebtedness (other
than the Loan) in an aggregate principal amount outstanding of
US$50,000 or more when due or such indebtedness becomes due by
declaration or otherwise prior to the date it would otherwise have
become due, or (ii) fails to perform or observe any term, covenant or
condition on his part to be performed or observed under any agreement
or instrument relating to any such indebtedness when required to be
performed or observed if the effect of such failure to perform or
observe is to accelerate, or to permit the acceleration of, the
maturity of such indebtedness; or any such indebtedness shall be
declared due and payable, or required to be prepaid (other than by a
regularly scheduled prepayment), prior to the stated maturity thereof;
(e) Borrower becomes bankrupt or insolvent or any bankruptcy, insolvency
or analogous proceedings are commenced by or against Borrower;
(f) any of the Security Documents at any time after their execution and
delivery and for any reason cease to create a valid and perfected
second charge on the Property or a valid and perfected security
interest in the remaining Collateral; or
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(g) a circumstance or event occurs that would or is reasonably likely to
have a material adverse effect on the ability of Borrower to perform
all or any of his respective obligations under or otherwise comply
with the terms of this Agreement or any of the other Loan Documents;
then, United may, by written notice to Borrower, declare the principal of
and interest due under the Loan to be forthwith due and payable, upon which
the principal and interest due under the Loan shall immediately become
forthwith due and payable, without presentment, demand, protest or other
notice of any kind, all of which are hereby expressly waived by Borrower.
4.2 REMEDIES. If one or more Events of Default occurs, United may proceed to
protect and enforce its rights by an action at law, in equity or any other
appropriate proceeding against Borrower, including but not limited to
taking possession of and protecting the Collateral. No delay on the part of
United in exercising any rights shall operate as a waiver thereof or
otherwise prejudice its rights. No right conferred hereunder upon United
shall be exclusive of any other rights referred to herein or now or
hereafter available at law, in equity, by statute or otherwise.
4.3 UNITED NOT RESPONSIBLE. Whether or not United elects to employ any or all
of the remedies available to it upon an occurrence of an Event of Default,
United shall not be liable for and assumes no responsibility for the
Collateral and United shall not be liable for the performance,
non-performance or delay in performance of any obligation of Borrower or
for the failure to protect or insure the Collateral or for the payment of
any cost or expense incurred in connection therewith. Nothing herein shall
be construed as establishing a relationship between United and any other
party, except the lender-borrower relationship between United and Borrower.
United shall owe no duty to any person by reason of this Agreement to
protect the Collateral nor shall United be under any duty to apply any
undispersed portion of the Loan to claims arising out of any of the
foregoing or to exercise any of its rights of powers hereunder.
Article V
MISCELLANEOUS
5.1 AMENDMENT; WAIVER. This Agreement may not be altered or amended except by
the written agreement of the United and Borrower. No provision of this
Agreement or right of United hereunder can be waived nor can Borrower be
released from his obligations hereunder except by a writing duly executed
by United.
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5.2 NOTICES. All notices, demands, requests or other communications to be sent
by one party to the other hereunder or required by law shall be in writing
and shall be deemed to have been validly given or served by delivery of the
same in person to the intended addressee, by telefacsimile transmission to
such party at the telecopy number set forth for such party below, or by
depositing the same with Federal Express or other reputable private
international courier service for next business day delivery to the
intended addressee at the address set forth below or at such other address
or telecopy number as need be designated by such party as herein provided,
addressed as follows:
If to Borrower: Xxxx X. Xxxxxxxxx
UPC Services Ltd.
00 Xxxxxxxx Xxxx
Xxxxxx X0X 0XX
(O) 44 20 7518 7980
(F) 44 20 7518 7981
If to United: United International Properties, Inc.
0000 Xxxxx Xxxxxx Xxxxxx
00xx Xxxxx
Xxxxxx, XX 00000
Attn: Chairman
Copy: Legal Department
(O) 000-000-0000
(F) 000-000-0000
All notices, demands and requests shall be effective upon such personal
delivery or upon confirmation of delivery by telefacsimile transmission or
three business days after being deposited with the private courier service.
Rejection or other refusal to accept or the inability to deliver because of
change of address of which no notice was given as herein required shall be
deemed to be receipt of the notice, demand or request sent.
5.3 SEVERABILITY. If any provision of this Agreement or the application thereof
to any person or circumstance shall be invalid or unenforceable to any
extent, the remainder of this Agreement and the application of such
provision to other persons or circumstances shall not be affected thereby
and shall be enforced to the greatest extent permitted by law.
5.4 ENTIRE AGREEMENT. This Agreement and the other Loan Documents contain the
entire agreement between the parties relating to the subject matter hereof
and supersede all oral statements and prior writings with respect thereto.
5.5 GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the laws of the State of Colorado, USA.
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5.6 JURISDICTION. Borrower hereby consents to the jurisdiction of any state or
federal court sitting in Denver, Colorado, USA, for purposes of all legal
proceedings brought under or arising out of this Agreement, and irrevocably
waives, to the fullest extent permitted by law, any claim or defense that
such forum is not convenient or proper. Notwithstanding the preceding
sentence, United retains the right to bring any suit, action or proceeding
seeking to enforce any provision of, or based on any matter arising out of
or in connection with this Agreement in any court that has jurisdiction
over the parties or subject matter.
5.7 COUNTERPARTS. This Agreement may be executed in any number of counterparts
or counterpart signature pages with each party executing the counterpart on
a different copy of the Agreement, each of which when so executed shall be
an original, but all of which together shall constitute one and the same
instrument.
5.8 TIME OF THE ESSENCE. Time is of the essence in regard to the various rights
and obligations contained in any of the Loan Documents.
5.9 FURTHER ASSURANCES. From time to time and at any time, upon United's
request, Borrower shall take all such further actions and shall execute and
deliver all such further documents as United reasonably deems necessary or
proper to effect the purposes and intents of this Agreement and the other
Loan Documents.
5.10 NOT ASSIGNABLE. This Agreement may not be assigned by Borrower without the
prior written consent of United. Any such assignment without consent shall
be void, and shall constitute a default hereunder. Subject to the foregoing
restriction, this Agreement shall inure to the benefit of United, its
successors and assigns and bind Borrower, his heirs and assigns.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date first set forth above.
UNITED:
United International Properties, Inc.
By:
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Its:
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BORROWER:
/s/ Xxxx X. Xxxxxxxxx
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Xxxx X. Xxxxxxxxx
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