Exhibit 10.20
Lease Agreement
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Lease agreement (Tranche 3)
between
RSL Com Europe Ltd
and
AB LM Ericsson Finans
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Commercial in confidence
Lease Agreement
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Contents;
1. General Agreement
2. Tranche 3 Special Terms
3. General Terms
4. Exhibit 1 - Description of the equipment
5. Exhibit 2 - Option dates and option prices
6. Exhibit 3 - Termination value
7. Exhibit 5 - Form for supplier's consent
8. Exhibit 6 - Form for acceptance of delivery
9. Exhibit 7 - Rent payments
10. Exhibit 11 - Debenture
11. Exhibit 12 - Form for sub-lessee's consent
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Commercial in confidence
General Agreement 1(12)
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AGREEMENT
between
AB X X ERICSSON FINANS
and
RSL COM EUROPE LIMITED
relating to
Lease of Xxxxxxx 0, Xxxxxxx 0, Xxxxxxx 0 and Tranche 4 for
RSL's European Network Roll-Out
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Commercial in confidence
General Agreement 2(12)
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This agreement ("Agreement") is made and entered into between
AB X X ERICSSON FINANS, a Swedish limited liability company,
and
RSL Com Europe Ltd., a UK limited liability company with its
registered address at 0 Xxx Xxxxxx Xxxxxx Xxxxxxxxxxx Xxxxxx, XX0X
0XX England.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed in two counterparts on the last day below written.
AB LM ERICSSON RSL COM EUROPE LTD
FINANS
Date: Date: 10/4/96
By: /s/ AB LM Ericsson Finans By: /s/ X. XXXXXXXX
------------------------- -----------------------
Name: AB LM Ericsson Finans Name: X. XXXXXXXX
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Title: ______________________ Title: President & CEO
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Commercial in confidence
General Agreement 3(12)
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AGREEMENT
This agreement outlines the Special Terms for the lease agreement
under which AB LM Ericsson Finans is prepared to undertake the
commitment to provide a lease facility to RSL Com Europe Ltd up to
the equivalent of USD 10,000,000 (ten million US dollars).
Each individual lease agreement (for tranche 1, tranche 2, tranche 3
and tranche 4) will consist of the following:
o Special Terms which will consist of clauses 1 to 18 below as
modified to reflect tranche specific circumstances. Where a
clause is left blank in the Special Terms the corresponding
clause of the General Terms shall apply.
o General Terms
o Exhibits: Exhibit 1 is tranche specific.
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Commercial in confidence
General Agreement 4(12)
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1 DEFINITIONS
1.1 In each tranche specific lease agreement, the following terms and
conditions, which are not defined in the General Terms, shall have
the following meanings:
"Account": tranche specific.
There is no collateral provided for the Lessee's obligations under
the Agreement and all references to "Collateral" shall be
inoperative.
"Currency of Payment": tranche specific
"Commitment" means the commitment of Lessor to provide a lease
facility to lessee up to the equivalent of USD 10,000,000 (ten
million US dollars). This Commitment can be drawn in no more than
four tranches. Tranches shall consist of equipment as follows:
o Tranche 1, all equipment in order Y3344 (contract December 7,
1995) excluding Sweden and Finland SSP SW
o Tranche 2, equipment in respect of which lessee shall have issued
acceptance certificates issued by Lessee for the Equipment in
accordance with Clause 4.3 of the General Terms, before July 1,
1996
o Tranche 3, equipment in respect of which lessee shall have issued
acceptance certificates issued by Lessee for the Equipment in
accordance with Clause 4.3, before January 1, 1997
o Tranche 4, equipment in respect of which lessee shall have issued
acceptance certificates issued by Lessee for the Equipment in
accordance with Clause 4.3, before July 1, 1997
"Expire Date" means the date occurring 72 months after the Lease
Commencement Date, or such later date as may follow from an
agreement to extend the lease pursuant to Clause 13.8.
"Final Availability Date" means
o for Tranche 1, June 30, 1996,
o for Tranche 2, July 2, 1996,
o for Tranche 3, January 2, 1997,
o for Tranche 4, July 2, 1997.
"Language" means the English language.
"Lease Commencement Date" means,
o for Tranche 1, in respect of the AXE 10 Switching Systems at any
location, the date when the acceptance certificate is issued by
Lessee for the Equipment at that Location in accordance with
Clause 4.3 or such other date when the Equipment shall be deemed
to be accepted by the Lessee hereunder.
o for Tranche 2, 1 July 1996
o for Tranche 3, 1 January 1997
o for Tranche 4, 1 July 1997
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General Agreement 5(12)
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"LOCATION": tranche specific.
"MARGIN" means four and one half (4.5) percentage points.
"PURCHASE PRICE" means the sum specified in exhibit 1 for each
tranche.
"SECURITY DOCUMENTS" means the Debenture comprised in Exhibit 11.
There is no "SECURITY PROVIDER" under the Agreement and all
references to "SECURITY PROVIDER" shall be inoperative.
"SUPPLIER": tranche specific and means the Ericsson company with
whom a supply agreement is concluded.
"SUPPLY AGREEMENT" Tranche specific and means a Supply and
Installation Contract to be concluded between Lessee and Supplier.
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Commercial in confidence
General Agreement 6(12)
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2 CONDITIONS PRECEDENT
2.1 The following additional documents shall be delivered pursuant to
Clause 2.1:
A business plan reflecting the equity increase provided for in
Clause 2.2.
Sub-lessee's consent, in the form attached hereto as Exhibit 12,
signed and delivered by Cyberlink Sweden AB, Sweden, and Cyberlink
International OY, Finland.
Clause 2.1(g) regarding legal opinion shall not be applicable.
2.2 The following additional condition(s) shall be met pursuant to
Clause 2.2:
Lessee shall increase the value of the equity of Lessee with USD
four million six hundred thousand (4,600,000) (such equity to be
defined in accordance with the International Accounting Standards of
IASC) evidenced by a balance sheet certified by the Lessee's
auditors.
The Debenture (Exhibit 11) shall become effective.
3 ASSIGNMENT
Clause 3.1 shall read as follows:
3.1 The Lessee does hereby assign to the Lessor all of the Lessee's
rights and interest in respect of the Equipment under the Supply
Agreement, including, but not limited to, the right to acquire
ownership to hardware parts and license to use software parts of the
Equipment and the benefit of all warranties in respect of the
Equipment contained in the Supply Agreement. In the event that
ownership rights of any hardware parts have already been transferred
from Supplier to Lessee under the Supply Agreement such ownership
rights are hereby assigned to Lessor.
3.2 The Lessor hereby assumes the Lessee's obligation to pay the
Purchase Price and take delivery of the Equipment under the Supply
Agreement. The Lessor does not assume any of the Lessee's other
obligations under the Supply Agreement, and the Lessee shall in
respect of such obligations at all times remain liable to the Seller
as if this Agreement had not been executed.
3.3 When the Lessor exercises any of the rights under the Supply
Agreement or makes any claim with respect to the Equipment, the
terms and conditions of the Supply Agreement shall apply to, and be
binding upon, the Lessor.
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Commercial in confidence
General Agreement 7(12)
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3.4 The Lessor shall procure that the Seller consents to the assignment
and assumption by the Lessor of certain rights and obligations under
the Supply Agreement in the form attached hereto as Exhibit 5.
Except as provided in Exhibit 5, the Supply Agreement shall
not be modified by this Agreement.
3.5 Neither party shall enter into any other agreement that would amend,
modify or supplement the Supply Agreement without the prior written
consent of the other party.
3.6 If the Lease Commencement Date has not occurred on or prior to the
Final Availability Date, the Lessor shall be entitled to terminate
this Agreement by giving written notice to the Lessee and the
Supplier. Following such notice of termination all rights assigned
to the Lessee pursuant to Clause 3.1 shall be reassigned to the
Lessee, and the Lessor shall be released from the obligations
assumed pursuant to Clause 3.2, which shall be reassumed by the
Lessee. On receipt of the Lessor's certificate evidencing the
Lessor's costs incurred in connection with the entering into and
termination of this Agreement, the Lessee shall promptly reimburse
the Lessor for all such costs.
Clause 3 shall not apply to any services. Examples of services are
Interconnect support, On-site second line support, On-site services
and Support for maintenance.
4 SELECTION, DELIVERY AND INSPECTION
4.6 Equipment already in the possession of the lessee on the date of
this agreement shall be deemed to be delivered, and shall be
accepted by the lessee pursuant to this clause 4 unless otherwise
agreed in writing by the lessor.
5 LEASE
5.6 The following sentence shall be read in conjunction with clause 5.6
of the General Terms:
For the avoidance of doubt, the Guarantees and Warrantees and other
rights refer to the rights of the lessee arising under the supply
agreement and any reference to rights in this clause 5.6 shall
include Guarantees and Warranties.
6 PAYMENTS
6.1 Clause 6.1 shall not be applicable.
6.2 For Tranche 2, Tranche 3 and Tranche 4 only, Initial Rent Payment
shall be capitalised and added to the outstanding balance of the
Purchase Price for all purposes of this agreement.
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Commercial in confidence
General Agreement 8(12)
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The initial Rent Payment shall be calculated as follows:
Accrued interest on the aggregate amounts paid by Lessor for the
applicable items of Equipment under the terms of Supply Agreement,
up to and including the Lease Commencement Date. This payment shall
accrue at an interest rate which shall be equal to one month LIBOR,
as defined below, plus four and one half (4.5) percentage points, as
determined on the first Business Day of each month. The interest
shall be calculated on the basis of actual days elapsed, but
computed using a 360-day year, and shall be compounded monthly.
One month LIBOR shall be determined as the arithmetic mean of the
rates of interest per annum for one month's deposits of US Dollars
which are offered to prime banks that participate in the London
market
(i) as such rates appear on the page designated as page "LIBO" on
the Reuters Monitor Money Rates Service ("LIBO Page") as of
10.00 a.m. (London time) on such date, if two or more
quotations appear on the LIBO Page for such date, or
(ii) by the principal London offices of Barclays Bank plc, Xxxxxx
Guaranty Trust Company of New York, and National Westminster
Bank plc as of 10.00 a.m. (London time) on such date, if fewer
than two quotations appear on the LlBO Page for such date.
6.3 Lessee covenants and agrees to pay Lessor in immediately available
funds twenty (20) Rent Payments in arrears during the Lease Period.
The first Rent Payment shall become due on the day falling six (6)
months after the Lease Commencement Date which is for:
o Tranche 1, attributable to the date of the first AXE 10 Switching
System to be accepted.
o Tranche 2, July 1, 1996
o Tranche 3, January 1, 1997
o Tranche 4, July 1, 1997.
Thereafter, the following three (3) Rent Payments shall become due
on the last day of each following six (6) months period. Thereafter,
the following sixteen (16) Rent Payments shall become due on the
last day of each following three (3) months period, provided
however, that the last Rent Payment shall become due on the last day
of the Lease Period.
6.12 For each amount of the Purchase Price to be paid by the Lessor to
the Supplier in currency different from GBP, the Lessor will
determine the Purchase Price in GBP by converting such amount into
GBP at the rate of exchange at which the Lessor is or would be able
to purchase GBP in the foreign exchange market for spot delivery at
or around 11.00
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Commercial in confidence
General Agreement 9(12)
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a.m. Stockholm time two (2) Business Days prior to the date of
Lessor's payment.
6.13 The Lessor shall notify the Lessee of the amount of any Rent Payment
due no later than 10 working days prior to the relevant Rent Payment
date.
7 USE, MAINTENANCE AND ALTERATIONS
7.5 Subject as provided herein, the Lessee may not, without prior
written notice to the Lessor, permanently remove any part from, or
alter or make additions to, the equipment. Such written notice shall
be without responsibility on the part of the lessor for any
interference with the operations of the equipment or impairment of
its value.
7.8 Lessee may sub-lease the Equipment to Cyberlink Sweden AB and
Cyberlink International OY, provided that (i) the sub-lease shall
terminate one day prior to the expiration or termination for
whatever cause of this Agreement, (ii) the sub-lessee shall
undertake in writing to be bound by the terms and conditions of this
Agreement and accept Lessor as third party beneficiary, (iii) Lessee
shall remain responsible to Lessor in accordance with the terms of
this Agreement and shall be responsible to Lessor for any acts or
omissions of the sub-licensee as if such acts and omissions were
undertaken by Lessee, and (iv) the sub-lessees shall have executed
the sub-lessee's consent attached hereto as Exhibit 12.
8 INDEMNITIES
8.3 The Lessee shall be responsible for and reimburse the lessor against
all taxes, duties and other charges levied or imposed by any
Government or local authority against the Lessor or the Lessee and
relating to this agreement or the Equipment except for taxes on the
Lessor's overall income.
9 INSURANCES
[ ]
10 INFORMATION
10.1 (f) budget for the current year in the form of consolidated
balance sheet, consolidated cash flow and consolidated income
statement, and projections for the following year of
consolidated balance sheet, consolidated cash flow and
consolidated income statement, and upon request from lessor,
detailed information to be reviewed at lessee's premises.
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Commercial in confidence
General Agreement 10(12)
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10.1 (h) site asset register
11 OWNERSHIP AND MARKING
11.1 [ ]
11.2 There shall be, displayed in a prominent position in the immediate
vicinity of the equipment which is subject to this lease, a notice
bearing the inscription "Any and all equipment in this room bearing
the Ericsson name is owned by AB LM Ericsson Finans." This notice
will be provided and affixed by Ericsson.
The inscription provided for in Clause 11.2 shall be in English,
Swedish or Finnish as applicable.
12 EVENTS OF DEFAULT
12.1 (a) the lessee shall fail to pay any amount due under this
agreement within five (5) business days after notice thereof
has been given to the lessee;
12.1 (q) The debt/equity ratio of Lessee exceeds one to one (1:1).
For this purpose:
(i) debt is defined as any indebtedness to a third party, any
indebtedness to any affiliate to Lessee which is not
subordinated to this Agreement, and including debt
obligations under this Agreement
(ii) equity is defined as the sum of ordinary share capital issued
and fully paid together with any fully paid share premium, any
undistributable reserves, any retained earnings and any
indebtedness which is subordinated to the obligations under
this Agreement
12.2 (a) enter the premises of the lessee or any other place where the
equipment may be located and reposess the equipment,
disconnecting and separating all thereof from any other
property using all reasonable means necessary to do so.;
13 PURCHASE OPTION
The Option Dates and the Option Prices are defined in Exhibit 2. The
Lessee shall pay to the Lessor 70% of all costs and expenses
incurred by Lessor in connection with the sale of the Equipment
under this Clause 13, where costs and expenses are defined as the
actual administrative costs at no more than (pound)19,000 (nineteen
thousand) per purchase option exercise event, where each event can
encompass one or several tranches
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Commercial in confidence
General Agreement 11(12)
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14 RETURN OF THE EQUIPMENT
14.1 The Equipment shall be returned to Stockholm, Sweden to the premises
of the Lessor, or as otherwise notified by Lessor
15 REPRESENTATIONS AND WARRANTIES
15.1 The following additional representation and warranty is made by the
Lessee:
- the business plan related to Lessee's business activities provided
for in Clause 2.1 has been prepared in accordance with generally
accepted accounting principles and practices in the UK and present
fairly and correctly the financial position of Lessee as at the date
thereof and the results of the operations of Lessee, respectively,
for the period referred to in the business plan, and as at date
referred to in the business plan, Lessee had no significant
liabilities (contingent or otherwise) which are not disclosed by, or
reserved against, in the business plan.
16 RIGHTS REMEDIES AND WAIVERS
[ ]
17 MISCELLANEOUS
17.5 Lessor AB X X ERICSSON FINANS
X-000 00 XXXXXXXXX
Xxxxxx
Telephone: x00 0 000 00 00
Telefax: x00 0 000 00 00
Telex: 14910 XXXX S
For the attention of: Finance department
Lessee: RSL COM EUROPE LTD
Victoria House
London Square
Cross Lanes
Guidford
Surrey
England
Telephone: x00 0000 000000
Telefax: x00 0000 000000
For the attention of: Mr. Xxxxxxx Xxxxxxxx
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General Agreement 12(12)
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17.11 Clause 17.11 shall not apply.
17.12 With advance notice of five (5) Business days, the lessor (or its
nominee) shall at any time during working hour have the right to
enter the premises of the lessee or any other place where the
equipment may be located for the purpose of inspecting the same or
observing its use.
17.13 Clause 17.13 shall not apply.
17.14 The following additional provisions shall apply.
The Lessee shall not, without Lessors prior written consent, create,
assume, incur or suffer to be created, assumed or incurred or permit
to subsist any mortgage, lien, pledge or other encumbrance of any
kind ("Encumbrance") upon any of its present or future revenues or
assets, for the purpose of securing any indebtedness (or any
guarantee or other obligation in respect of any indebtedness) now or
hereafter existing. Lessee shall however be entitled to make such
Encumbrance, except any Encumbrance on the equipment subject to this
Agreement without Lessor's prior consent for securing medium and
long term indebtedness with an aggregate value not exceeding USD
2,000,000.
17.15 For tranche 1 only, in the event that the Swedish Export Credit
Board (EKN) would approve a guarantee of the lease payments within
four (4) months from the date of this agreement, either party may
call for good faith negotiations as to the amendment of relevant
parts of this agreement. Should the parties not be able to agree on
such amendment within two (2) months from the date of the EKN
approval, this agreement shall remain in full force without any
changes.
18 APPLICABLE LAW AND JURISDICTION
[ ]
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Commercial in confidence
Special Terms - Tranche 3 1(11)
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LEASE AGREEMENT
between
AS X X ERICSSON FINANS
and
RSL COM EUROPE LIMITED
relating to
TRANCHE 3
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Commercial in confidence
Special Terms - Tranche 3 2(11)
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This lease agreement ("Agreement") is made and entered into between
AB X X ERICSSON FINANS, a Swedish limited liability company,
hereinafter called the "Lessor",
and
RSL Com Europe Ltd., a UK limited liability company with its
registered address at 0 Xxx Xxxxxx Xxxxxx Xxxxxxxxxxx Xxxxxx, XX0X
0XX England, hereinafter called the "Lessee".
This Agreement, consisting of this signature cover page, the general
terms of Agreement ("General Terms") and the special terms of
Agreement ("Special Terms") as well as the Exhibits (as defined
below), sets out the terms on which the Lessor agrees to lease the
Equipment (as defined below) to the Lessee. The General Terms set
out the main terms of the Agreement. The Special Terms set out the
customer specific terms of the Agreement, as an amendment or
complement to the corresponding terms (with corresponding numbering)
of the General Terms.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed in two counterparts on the last day below written.
AB X X ERICSSON RSL COM EUROPE LTD
FINANS
Date: 30 December, 1996 Date: 24th December 1996
By: /s/ AB X X Ericsson Finans By: /s/ R. E. Xxxxxxxx
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Name: /s/ AB X X Ericsson Finans Name: /s/ R. E. XXXXXXXX
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Title: ___________________ Title: President & CEO
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Special Terms - Tranche 3 3(11)
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TABLE OF CONTENTS
SPECIAL TERMS/GENERAL TERMS
1 Definitions 4
2 Conditions precedent 5
3 Assignment 5
4 Selection, delivery and inspection 6
5 Lease 6
6 Payments 7
7 Use, maintenance and alterations 8
8 Indemnities 8
9 Insurances 8
10 Information 8
11 Ownership and marking 9
12 Events of default 9
13 Purchase option 9
14 Return of the equipment 10
15 Representations and warranties 10
16 Rights, remedies and waivers 10
17 Miscellaneous 10
18 Applicable law and jurisdiction 11
EXHIBITS
1 Description of the Equipment
2 Option Dates and Option Prices
3 Termination Value
4 (Not applicable)
5 Form for Supplier's consent
6 Form for acceptance of delivery
7 Rent Payments
8 (Not applicable)
9 (Not applicable)
10 (Not applicable)
11 Debenture
12 Form for sub-lessee's consent
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Special Terms - Tranche 3 4(11)
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SPECIAL TERMS
1 DEFINITIONS
1.1 In this Agreement the following terms and conditions, which are not
defined in the General Terms, shall have the following meanings:
"ACCOUNT" means, on the date hereof, Lessors account #5554-822959
with Skandinaviska Enskilda Banken, Stockholm, Sweden.
There is no collateral provided for the Lessee's obligations under
the Agreement and all references to "COLLATERAL" shall be
inoperative.
"CONSENT AND AGREEMENT" means the document comprised in Exhibit 5
tranche 1, which shall be valid for tranche 3 also.
"CURRENCY OF PAYMENT" means Pound Sterling (GBP).
"EXPIRE DATE" means the date occurring 72 months after the Lease
Commencement Date, or such later date as may follow from an
agreement to extend the lease pursuant to Clause 13.8.
"FINAL AVAILABILITY DATE" means March 30, 1997.
"LANGUAGE" means the English language.
"LEASE COMMENCEMENT DATE" means January 1, 1997.
"LOCATION" means Chuchill House, 000-000 Xxx Xxxxxx, Xxxxxx XX0,
Xxxxxxx, Xxxxxxxxxxxxxxx 0, 00000 Xxxxx, Xxxxxxx, 000 xxx, Xxxxxx
Xxxxxxx xx Xxxxxx, 00000 Neuilly-sur-Seine, cedex, France, Xxxxxx
Xxxxxxx 00, X-00000 Xxxxxxxxx, Xxxxxxx
"MARGIN" means four and one half (4.5) percentage points.
"PURCHASE PRICE" means the sum specified in Exhibit 1, converted to
GBP as per Clause 6.12
"SECURITY DOCUMENTS" means the Debenture comprised in Exhibit 11
tranche 1.
There is no "SECURITY PROVIDER" under the Agreement and all
references to "SECURITY PROVIDER" shall be inoperative.
"SUPPLIER" means Ericsson Ltd, UK
"SUPPLY AGREEMENT" means the "Supply and Installation Contract"
concluded between Lessee and Supplier on December 7, 1995 and to
include the following amendments;
Ericsson Offer Y3659 for Cisco routers ordered by RSL 26 July 1996
(PO number RSL 96/155).
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Special Terms - Tranche 3 5(11)
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Ericsson Offer Y3663 for IDNX equipment ordered by RSL 9 September
1996.
Ericsson offer Y3665 for PFA equipment ordered by RSL 9 September
1996.
Ericsson Offer Y3709 for AXE extension ordered by RSL 22 October
1996 (PO number RSL 96/306).
Ericsson Offer C/JN:96-102 for Echo Cancellors for Finland delivered
and installed during April 1996.
2 CONDITIONS PRECEDENT
2.1 The following additional documents shall be delivered pursuant to
Clause 2.1;
Sub-lessee's consent, in the form attached hereto as Exhibit 12,
signed and delivered by RSL Com OY, Finland, RSL Com France S.A. and
RSL Com Deutschland GmbH.
Clause 2.1(g) regarding legal opinion shall not be applicable.
2.2 Clause 2.2(a) shall not be applicable.
The following additional condition(s) shall be met pursuant to
Clause 2.2:
The Debenture (Exhibit 11) shall become effective.
3 ASSIGNMENT
Clause 3.1 shall read as follows:
3.1 The Lessee does hereby assign to the Lessor all of the Lessee's
rights and interest in respect of the Equipment under the Supply
Agreement, including, but not limited to, the right to acquire
ownership to hardware parts and license to use software parts of the
Equipment and the benefit of all warranties in respect of the
Equipment contained in the Supply Agreement. In the event that
ownership rights of any hardware parts have already been transferred
from Supplier to Lessee under the Supply Agreement, such ownership
rights are hereby assigned to Lessor.
The Lease shall only apply for Equipment and installation related
thereto, and shall not apply to services such as on-site services
and support for maintenance.
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Special Terms - Tranche 3 6(11)
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3.2 The Lessor hereby assumes the Lessee's obligation to pay the
Purchase Price and take delivery of the Equipment under the Supply
Agreement. The Lessor does not assume any of the Lessee's other
obligations under the Supply Agreement, and the Lessee shall in
respect of such obligations at all times remain liable to the Seller
as if this Agreement had not been executed.
3.3 When the Lessor exercises any of the rights under the Supply
Agreement, or makes any claim with respect to the Equipment, the
terms and conditions of the Supply Agreement shall apply to, and be
binding upon, the Lessor.
3.4 The Lessor shall procure that the Seller consents to the assignment
and assumption by the Lessor of certain rights and obligations under
the Supply Agreement in the form attached hereto as Exhibit 5.
Except as provided in Exhibit 5, the Supply Agreement shall not be
modified by this Agreement.
3.5 Neither party shall enter into any other agreement that would amend,
modify or supplement the Supply Agreement without the prior written
consent of the other party.
3.6 If the Lease Commencement Date has not occurred on or prior to the
Final Availability Date, the Lessor shall be entitled to terminate
this Agreement by giving written notice to the Lessee and the
Supplier. Following such notice of termination all rights assigned
to the Lessee pursuant to Clause 3.1 shall be reassigned to the
Lessee, and the Lessor shall be released from the obligations
assumed pursuant to Clause 3.2, which shall be reassumed by the
Lessee. On receipt of the Lessor's certificate evidencing the
Lessor's costs incurred in connection with the entering into and
termination of this Agreement, the Lessee shall promptly reimburse
the Lessor for all such costs.
4 SELECTION, DELIVERY AND INSPECTION
4.6 Equipment already in the possession of the Lessee on the date of
this agreement shall be deemed to be delivered, and shall be
accepted by the Lessee pursuant to this Clause 4 unless otherwise
agreed in writing by the Lessor.
5 LEASE
5.6 The following sentence shall be read in conjunction with Clause 5.6
of the General Terms;
For the avoidance of doubt, the Guarantees and Warrantees and other
rights refer to the rights of the Lessee arising under the supply
agreement and any reference to rights in this Clause 5.6 shall
include Guarantees and Warranties.
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Special Terms - Tranche 3 7(11)
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6 PAYMENTS
6.1 Clause 6.1 shall not be applicable.
6.2 Initial Rent Payment shall be capitalised and added to the
outstanding balance of the Purchase Price for all purposes of this
Agreement.
The initial Rent Payment shall be calculated as follows;
Accrued interest on the aggregate amounts paid by Lessor for the
applicable items of Equipment under the terms of Supply Agreement,
up to and including the Lease Commencement Date. This payment shall
accrue at an interest rate which shall be equal to one month LIBOR,
as defined below, plus four and one half (4.5) percentage points, as
determined on the first Business Day of each month. The interest
shall be calculated on the basis of actual days elapsed, but
computed using a 360-day year, and shall be compounded monthly.
One month LIBOR shall be determined as the arithmetic mean of the
rates of interest per annum for one month's deposits of US Dollars
which are offered to prime banks that participate in the London
market
(i) as such rates appear on the page designated as page "LIBO" on
the Reuters Monitor Money Rates Service ("LIBO Page"') as of
10.00 a.m. (London time) on such date, if two or more
quotations appear on the LIBO Page for such date, or
(ii) by the principal London offices of Barclays Bank plc, Xxxxxx
Guaranty Trust Company of New York, and National Westminster
Bank plc as of 10.00 a.m. (London time) on such date, if fewer
than two quotations appear on the LIBO Page for such date.
6.3 Lessee covenants and agrees to pay Lessor in immediately available
funds twenty (20) Rent Payments in arrears during the Lease Period.
The first Rent Payment shall become due on the day falling six (6)
months after the Lease Commencement Date. Thereafter, the following
three (3) Rent Payments shall become due on the last day of each
following six (6) months period. Thereafter, the following sixteen
(16) Rent Payments shall become due on the last day of each
following three (3) months period, provided however, that the last
Rent Payment shall become due on the last day of the Lease Period.
6.12 For each amount of the Purchase Price to be paid by the Lessor to
the Supplier in FIM, the Lessor will determine the Purchase Price in
GBP by converting such amount of FIM, respectively, into GBP at the
rate of exchange at which the Lessor is or would be able to purchase
GBP with FIM, respectively, in the foreign exchange market for spot
delivery at or around 11.00 a.m. Stockholm time two (2) Business
Days prior to the date of Lessor's payment.
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Commercial in confidence
Special Terms - Tranche 3 8(11)
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6.13 The Lessor shall notify the Lessee of the amount of any Rent Payment
due no later than 10 working days prior to the relevant Rent Payment
date.
7 USE, MAINTENANCE AND ALTERATIONS
7.5 Subject as provided herein, the Lessee may not, without prior
written notice to the Lessor, permanently remove any part from, or
alter or make additions to, the equipment. Such written notice shall
be without responsibility on the part of the lessor for any
interference with the operations of the equipment or impairment of
its value.
7.8 Lessee may sub-lease the Equipment to RSL Com Finland OY, RSL Com
France S.A. and RSL Com Deutschland GmbH, provided that (i) the
sub-lease shall terminate one day prior to the expiration or
termination for whatever cause of this Agreement, (ii) the
sub-lessee shall undertake in writing to be bound by the terms and
conditions of this Agreement and accept Lessor as third party
beneficiary, (iii) Lessee shall remain responsible to Lessor in
accordance with the terms of this Agreement and shall be responsible
to Lessor for any acts or omissions of the sub-licensee as if such
acts and omissions were undertaken by Lessee, and (iv) the
sub-lessees shall have executed the sub-lessee's consent attached
hereto as Exhibit 12.
8 INDEMNITIES
8.3 The Lessee shall be responsible for and reimburse the lessor against
all taxes, duties and other charges levied or imposed by any
Government or local authority against the Lessor or the Lessee and
relating to this agreement or the Equipment except for taxes on the
Lessor's overall income.
9 INSURANCES
[ ]
10 INFORMATION
10.1 (f) budget for the current year in the form of consolidated
balance sheet, consolidated cash flow and consolidated income
statement and projections for the following year of
consolidated balance sheet, consolidated cash flow and
consolidated income statement, and upon request from Lessor,
detailed information to be reviewed at Lessee's premises.
10.1 (h) site asset register
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Commercial in confidence
Special Terms - Tranche 3 9(11)
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11 OWNERSHIP AND MARKING
11.1 [ ]
11.2 There shall be, displayed in a prominent position in the immediate
vicinity of the equipment which is subject to this lease, a notice
bearing the inscription "Any and all equipment in this room bearing
the Ericsson name is owned by AB LM Ericsson Finans." This notice
will be provided and affixed by Ericsson.
The inscription provided for in Clause 11.2 shall be in English, or
Finnish as applicable.
12 EVENTS OF DEFAULT
12.1 (a) the lessee shall fail to pay any amount due under this
agreement within five (5) business days after notice thereof
has been given to the Lessee;
12.1 (q) The debt/equity ratio of Lessee exceeds one to one (1:1).
For this purpose:
(i) debt is defined as any indebtedness to a third party, any
indebtedness to any affiliate to Lessee which is not
subordinated to this Agreement, and including debt obligations
under this Agreement
(ii) equity is defined as the sum of ordinary share capital issued
and fully paid together with any fully paid share premium, any
undistributable reserves, any retained earnings and any
indebtedness which is subordinated to the obligations under
this Agreement.
12.2 (a) enter the premises of the Lessee or any other place where the
equipment may be located and reposess the equipment,
disconnecting and separating all thereof from any other
property any using all reasonable means necessary to do so.;
13 PURCHASE OPTION
The Option Dates and the Option Prices are defined in Exhibit 2. The
Lessee shall pay to the Lessor 70% of all costs and expenses
incurred by Lessor in connection with the sale of the Equipment
under this Clause 13, where costs and expenses are defined as the
actual administrative costs at no more than (pound)19,000 (nineteen
thousand) per purchase option exercise event, where each event can
encompass one or several tranches.
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Special Terms - Tranche 3 10(11)
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14 RETURN OF THE EQUIPMENT
14.1 The Equipment shall be returned to Stockholm, Sweden to the premises
of the Lessor, or as otherwise notified by Lessor.
15 REPRESENTATIONS AND WARRANTIES
15.1 The following additional representation and warranty is made by the
Lessee:
- the business plan related to Lessee's business activities provided
for in Clause 2.1 has been prepared in accordance with generally
accepted accounting principles and practices in the UK and represent
fairly and correctly the financial position of Lessee as at the date
thereof and the results of the operations of Lessee, respectively,
for the period referred to in the business plan, and as at date
referred to in the business plan, Lessee had no significant
liabilities (contingent or otherwise) which are not disclosed by, or
reserved against, in the business plan.
16 RIGHTS, REMEDIES AND WAIVERS
[ ]
17 MISCELLANEOUS
17.5 Lessor: AB X X ERICSSON FINANS
X-000 00 XXXXXXXXX
Xxxxxx
Telephone: x00 0 000 00 00
Telefax: x00 0 000 00 00
Telex: 14910 XXXX S
For the attention of: Finance department
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Commercial in confidence
Special Terms - Tranche 3 11(11)
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Lessee: RSL COM EUROPE LTD
Victoria House
London Square
Cross Lanes
Guidford
Surrey
England
Telephone: x00 0000 000000
Telefax: x00 0000 000000
For the attention of: Mr. Xxxxxxx Xxxxxxxx and copy to
Xx Xxx Xxxxx
17.11 Clause 17.11 shall not apply.
17.12 With advance notice of five (5) Business days, the Lessor (or its
nominee) shall at any time during working hour have the right to
enter the premises of the Lessee or any other place where the
equipment may be located for the purpose of inspecting the same or
observing its use.
17.13 Clause 17.13 shall not apply.
17.14 The following additional provisions shall apply.
The Lessee shall not, without Lessor's prior written consent,
create, assume, incur or suffer to be created, assumed or incurred
or permit to subsist any mortgage, lien, pledge or other encumbrance
of any kind ("Encumbrance") upon any of its present or future
revenues or assets, for the purpose of securing any indebtedness (or
any guarantee or other obligation in respect of any indebtedness)
now or hereafter existing. Lessee shall however be entitled to make
such Encumbrance, except any Encumbrance on the equipment subject to
this Agreement, without Lessor's prior consent for securing medium
and long term indebtedness with an aggregate value not exceeding USD
2,000,000.
18 APPLICABLE LAW AND JURISDICTION
[ ]
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Commercial in confidence
1(19)
GENERAL TERMS
DEFINITIONS
1.1 In this Agreement the following terms and expressions shall have the
following meanings:
"ACCOUNT" means the account specified in the Special Terms or any
other bank account designated by the Lessor from time to time.
"AGREEMENT" means this Agreement consisting of two parts, Special
Terms and General Terms, and the Exhibits hereto, as hereafter
amended from time to time.
"BUSINESS DAY" means a day on which banks are open for business in
Stockholm and, in respect of any payment to be made hereunder, also
in the principal financial center of the currency of such payment.
"COLLATERAL" means any collateral provided as security for the
Lessee's obligations under this Agreement, as specified in the
Special Terms.
"CURRENCY OF PAYMENT" means the currency of payment under the
Agreement as specified in the Special Terms.
"DEFAULT" means an event which with the giving of notice and/or the
passage of time and/or the making of any determination of
materiality or fulfilment of any other applicable condition (or any
combination of the foregoing) would constitute an Event of Default.
"DEFAULT RATE" means the interest rate calculated as two (2) per
cent per annum above the higher of the Interest Rate and the
Lessor's cost of funds from whatever sources it may select.
"DELIVERY DATE" means the date on which the Equipment is actually
delivered to the Lessee by the Supplier.
"EVENTS OF DEFAULT" means any of the events of default specified in
Clause 12 or a failure by the Lessee to meet a deferred condition
precedent as specified in Clause 2.3.
"EVENT OF LOSS" means any of the following events:
(i) the Equipment shall be lost, stolen, destroyed or irreparably
damaged;
(ii) insurance proceeds shall be received based upon an event of
total or constructive total loss with respect to the Equipment
under an insurance policy;
(iii) title to the Equipment shall be taken or requisitioned by any
governmental body by condemnation or otherwise;
(iv) the use of the Equipment shall be taken or requisitioned by
any governmental body by condemnation or otherwise for a
period
2(19)
longer than three (3) months (or the remaining term of the
Lease Period, if less); or
(v) as a result of any rule, regulation, order or other action by
the relevant authority, any governmental body having
jurisdiction or any court of competent jurisdiction, the
normal operation or use of the Equipment shall have been
prohibited for a period of six months.
"EQUIPMENT" means the equipment described in Exhibit 1 and includes
any part thereof, and all replacements, renewals and additions made
in or to such equipment together with the Technical Documents and
all handbooks, manuals, data and drawings relating thereto.
"EXPIRY DATE" means the date specified as such in the Special Terms
or such later date as may follow from an agreement to extend the
lease pursuant to Clause 13.8.
"FINAL AVAILABILITY DATE" has the meaning specified in the Special
Terms.
"GENERAL TERMS" means the second part of this Agreement.
"INITIAL RENT PAYMENT" means the payment of the initial rent in the
Currency of Payment calculated in accordance with Clause 6.2.,
Special Terms.
"INITIAL RENT PAYMENT DATE" means each date on which an Initial Rent
Payment shall be made as set forth in Clause 6.2, Special Terms.
"INTEREST RATE" means, in respect of each Rent Payment, LIBOR (as
quoted on the fifth Business Day prior to the preceding Rent Payment
Date, or, in the case the first Rent Payment Date, the Lease
Commencement Date) in each case plus the Margin.
"LANGUAGE" has the meaning specified in the Special Terms.
"LEASE COMMENCEMENT DATE" means the last day of the month when an
acceptance certificate is issued by Lessee in accordance with Clause
4.4 or such other date when the Equipment shall be deemed to be
accepted by the Lessee hereunder.
"LEASE PERIOD" means the period commencing on the Lease Commencement
Date and ending on the earlier of (i) the Expiry Date, (ii) the day
on which this Agreement or the leasing of the Equipment is
terminated pursuant to the terms hereof, and (iii) the Rent Payment
Date on which the Lessee has exercised its option to purchase the
Equipment pursuant to Clause 13.
"LIBOR" means the arithmetic mean (rounded to the next higher one
hundred thousandth of a percentage point) of the rates of interest
per annum for three months' deposits of US Dollars which are offered
to prime banks in the London interbank market (i) as such rates
appear on the page designated as page "LIBO" on the Reuters Monitor
Money Rates Service ("LIBO Page") as of 10.00 a.m. (London time) on
such date, if two or more quotations appear on the LIBO Page for
such date, or (ii) by the principal London offices of Barclays Bank
plc, Xxxxxx Guaranty Trust Company of New York, and National
Westminster Bank plc as of 10.00 a.m. (London time) on such date, if
fewer than two quotations appear on the LIBO Page for such date.
"LOCATION" means the location specified in the Special Terms.
3(19)
"MARGIN" has the meaning specified in the Special Terms.
"MANAGEMENT FEE PAYMENT" means the payment of the management fee,
calculated in accordance with Clause 6.1.. Special Terms
"MANAGEMENT FEE PAYMENT DATE" means the date on which the Management
Fee shall be made as set forth in Clause 6.1.. Special Terms
"OPTION PRICE" means the price specified in Exhibit 2 for the
relevant Option Date.
"OPTION DATE" means the date(s) on which Lessee is granted an option
to purchase the Equipment pursuant to Clause 13, Special Terms.
"PURCHASE PRICE" means the sum of the purchase price payable to the
Supplier under the Supply Agreement and all other costs and expenses
of whatever nature payable by the Lessor in respect of the
acquisition of the Equipment. The purchase price under the Supply
Agreement is set out in the Special Terms.
"RENT PAYMENT" means the periodical payment for the lease of the
Equipment in the Currency of Payment, calculated in accordance with
Clause 6.4.
"RENT PAYMENT DATE" means each date on which a Rent Payment shall be
made as set forth in Clause 6.3.. Special Terms.
"SECURITY DOCUMENT" means any pledge agreement, guarantee or other
document providing security for the Lessee's obligations under this
Agreement, as specified in the Special Terms.
"SECURITY PROVIDER" means any party to a Security Document other
than the Lessor.
"SPECIAL TERMS" means the first part of this Agreement.
"SUPPLIER" has the meaning specified in the Special Terms.
"SUPPLY AGREEMENT" has the meaning specified in the Special Terms.
"TECHNICAL DOCUMENTS" means all documentation in respect of the
Equipment delivered by the Supplier under the Supply Agreement.
"TERMINATION VALUE" means the value specified in Exhibit 3.
1.2 The terms and conditions in the General Terms are complemented and
amended by the Special Terms and in case of any discrepancy, the
Special Terms shall prevail.
1.3 Any reference to a clause with a certain number shall, unless the
context otherwise requires, be construed as a reference to the
clause with such number in the General Terms, as amended or
complemented by the corresponding clause in the Special Terms. In
case a clause with such number does not exist in the General Terms,
the reference shall be solely to the clause with such number in the
Special Terms.
2 CONDITIONS PRECEDENT
2.1 The obligations of the Lessor under this Agreement are subject to
the receipt of the following documents, in form and substance
satisfactory to the Lessor, on or
4(19)
before the earlier of (i) the day falling thirty (30) Business Days
after the date hereof and (ii) the Lease Commencement Date:
(a) a certified copy of the constituent documents for the Lessee
and each Security Provider;
(b) evidence that the Lessee and each Security Provider is duly
registered at the relevant authority as a limited liability
company or other kind of business entity, as described in the
recital to this Agreement or the relevant Security Document;
(c) evidence that the Lessee has all necessary licenses and
permits to operate the Equipment and enter into this Agreement
and the Supply Agreement;
(d) evidence that the person(s) which has (have) signed this
Agreement and the Supply Agreement on behalf of the Lessee are
duly authorised to do so;
(e) evidence that the person(s) which has (have) signed the
Security Documents on behalf of each Security Provider are
duly authorised to do so;
(f) the latest available finance report of the Lessee and each
Security Provider;
(g) a legal opinion from independent counsel acceptable to Lessor,
substantially in the form of Exhibit 4 at the expense of
Lessee; and
(h) other document(s) specified in the Special Terms.
2.2 The obligation of the Lessor to lease the Equipment to the Lessee is
subject to the following conditions having been met on or before the
Lease Commencement Date:
(a) the Initial Rent Payment shall have been received by the
Lessor;
(b) the Lessor shall have acquired such rights and title to the
Equipment as is provided in the Supply Agreement;
(c) the Lessor shall have received a certified copy of an
insurance certificate evidencing that the Equipment is insured
in accordance with Clause 9;
(d) no Default shall have occurred or would occur as a result of
the commencement of the Lease Period; and
(e) other condition(s) specified in the Special Terms.
2.3 The conditions precedent set out in Clauses 2.1 and 2.2 are inserted
for the sole benefit of the Lessor and may be waived or deferred,
with or without conditions, by the Lessor. If the Lessor agrees to
the commencement of the Lease Period without all conditions having
been met, such conditions shall, unless otherwise is agreed, be
deferred for ten (10) Business Days from the Lease Commencement
Date. If any condition is not met on the date to which it has been
deferred, it shall constitute an Event of Default hereunder.
5(19)
3 ASSIGNMENT
3.1 The Lessee does hereby assign to the Lessor all of the Lessee's
rights and interest in respect of the Equipment under the Supply
Agreement, including, but not limited to, the right to acquire
ownership to hardware parts and license to use software parts of the
Equipment and the benefit of all warranties in respect of the
Equipment contained in the Supply Agreement.
3.2 The Lessor hereby assumes the Lessee's obligation to pay the
Purchase Price and take delivery of the Equipment under the Supply
Agreement. The Lessor does not assume any of the Lessee's other
obligations under the Supply Agreement and the Lessee shall in
respect of such obligations at all times remain liable to the Seller
as if this Agreement had not been executed.
3.3 When the Lessor exercises any of the rights under the Supply
Agreement, or makes any claim with respect to the Equipment, the
terms and conditions of the Supply Agreement shall apply to, and be
binding upon, the Lessor.
3.4 The Lessor shall procure that the Seller consents to the assignment
and assumption by the Lessor of certain rights and obligations under
the Supply Agreement in the form attached hereto as Exhibit 5.
Except as provided in Exhibit 5, the Supply Agreement shall not be
modified by this Agreement.
3.5 Neither party shall enter into any other agreement that would amend,
modify or supplement the Supply Agreement without the prior written
consent of the other party.
3.6 If the Lease Commencement Date has not occurred on or prior to the
Final Availability Date, the Lessor shall be entitled to terminate
this Agreement by giving written notice to the Lessee and the
Supplier. Following such notice of termination all rights assigned
to the Lessee pursuant to Clause 3.1 shall be reassigned to the
Lessee, and the Lessor shall be released from the obligations
assumed pursuant to Clause 3.2, which shall be reassumed by the
Lessee. On receipt of the Lessor's certificate evidencing the
Lessors costs incurred in connection with the entering into and
termination of this Agreement the Lessee shall promptly reimburse
the Lessor for all such costs.
4 SELECTION, DELIVERY AND INSPECTION
4.1 The Lessee has been responsible for agreeing the design, capacity,
quality and specification of the Equipment with the Supplier. The
Lessor is only responsible for the financing of the Equipment and
the Lessee accepts that the Lessor shall have no responsibility
whatsoever for the design, capacity, quality and specification of
the Equipment.
4.2 Unless otherwise instructed in writing by the Lessor, the Lessee
shall be responsible for and arrange to take delivery of the
Equipment from the Supplier at a place to be agreed between the
Lessee and the Supplier and notified by the Lessee to the Lessor.
The Lessor shall not be liable for any damage or loss arising
directly or indirectly from any delay or failure in delivery (or,
where applicable, installation) of the Equipment.
4.3 The Lessee shall on behalf of the Lessor issue the final acceptance
certificate to the Supplier under the Supply Agreement and any
defect or other objection relating to any part of the Equipment
shall be dealt with by the Lessee directly with the Supplier.
Simultaneously with the issuance of the acceptance certificate the
Lessee shall send a copy of the said certificate to Lessor. The
Lessee's
6(19)
acceptance of delivery from the Supplier on behalf of the Lessor
shall constitute conclusive acceptance also under this Agreement. If
the Lessee fails to give timely notice under the Supply Agreement of
any defect or other objection to the Supplier, the Equipment shall
as between the Lessor and the Lessee be considered to have been
property and timely delivered in good condition and satisfactory
working order.
4.4 The Lessee shall, within five (5) Business Days after the last of
the Delivery Dates, sign and deliver to the Lessor a certificate of
delivery in the form attached hereto as Exhibit 6. This certificate
shall be in addition to any certificates or acknowledgements that
may be required by the Supplier.
4.5 All risk of loss or damage to the Equipment shall as between the
Lessor and the Lessee pass to the Lessee when such risk passes from
the Supplier to the Lessor under the Supply Agreement.
4.6 Equipment already in the possession of the Lessee on the date of
this Agreement shall be deemed to be delivered to and accepted by
the Lessee pursuant to this Clause 4 unless otherwise agreed in
writing by the Lessor.
5 LEASE
5.1 The Lessor agrees to lease to the Lessee, and the Lessee agrees to
lease from the Lessor, the Equipment upon the terms set forth in
this Agreement.
5.2 The term of this Agreement shall, unless earlier terminated pursuant
to the express provisions hereof, expire on the Expiry Date. The
Lessee shall have no right to request an extension of the Lease
Period other than in accordance with Clause 13.8.
5.3 The Lessee leases the Equipment "as is". The Lessor does not let or
supply the Equipment to the Lessee with or subject to any condition
or warranty, express or implied, whether statutory or otherwise,
whether as to the state of quality of the Equipment or as to
description, repair or fitness for any purpose or otherwise, and all
such conditions and warranties are herein expressly excluded.
5.4 No third party (including any affiliate of the Lessor) has any
authority to bind the Lessor or make any representation or give any
warranty or guarantee on behalf the Lessor.
5.5 The Lessor shall not be liable for any defects or deficiencies in
the Equipment or for any direct or consequential damages therefrom
or for any interruption in the Lessee's business occasioned by the
Lessee's inability to use the Equipment for any reason whatsoever.
The Lessor shall under no circumstances be liable to provide the
Lessee with any replacement equipment.
5.6 The Lessor hereby assigns to the Lessee for the Lease Period any and
all guarantees, warranties and other rights (ownership excluded)
which may have been (or in the future are) given to the Lessor in
respect of the Equipment and which the Lessor has the right to
assign. The Lessor shall take all reasonable steps, at the cost and
expense of the Lessee, to obtain all necessary consents to so
assign. To the extent that any rights may not be assigned to the
Lessee, such rights shall, as between the Lessor and the Lessee,
solely inure to the benefit of the Lessee, and the Lessor shall, at
the Lessee's sole expense and risk, enforce such rights or give the
Lessee a power of attorney to enforce in the Lessor's name.
7(19)
6 PAYMENTS
6.1 The Lessee shall make the Management Fee Payment on the Management Fee
Payment Date, as set forth in the Special Terms.
6.2 The Lessee shall make the Initial Rent Payments on the Initial Rent
Payment Dates, as set forth in the Special Terms.
6.3 The Lessee shall make the Rent Payments on the Rent Payment Dates, as set
forth in the Special Terms.
6.4 The Rent Payments due on each Rent Payment Date shall consist of the sum
of (i) an amount equivalent to the percentage of the Purchase Price set
forth opposite such Rent Payment Date in Exhibit 7 under the heading "Per
cent of the Purchase Price in each Rent Payment" and (ii) an amount equal
to the interest that would xxxx accrued (calculated at the Interest Rate
on the actual number of days elapsed on a 360 day/year basis) on the
outstanding balance of the Purchase Price during the period commencing on
the preceding Rent Payment Date (or, in the case of the first Rent
Payment, the Lease Commencement Date) set fourth in Exhibit 7 under the
heading "Outstanding balance in per cent of the Purchase Price".
6.5 Lessor shall not later than two (2) Business Days before the commencement
of each rent period in writing quote to Lessee the Interest Rate and the
Rent Payment for the subsequent period. Unless Lessee has raised any
objections to the quotation no later than five (5) Business Days after the
receipt of the quotation, it shall be deemed valid for the relevant rent
period.
6.6 The Lessee shall make any payment to be made to the Lessor under this
Agreement (by telex advice) in immediately available funds to the Account.
6.7 In event that the Lessor does not receive on the due date any amount due
under this Agreement, the Lessee shall pay to the Lessor on demand
interest on such amount from and including the due date to the date of
actual payment at the Default Rate.
6.8 Whenever a payment is due on a day which is not a Business Day, such
payment shall be made on the next Business Day.
6.9 The Lessee undertakes an unconditional obligation to make the Initial Rent
Payment and the Rent Payments as specified in this Clause 6. The Lessee
shall not be released from the obligation to pay any sum due hereunder by
reason of any defect or deficiency in the Equipment, or the Equipment
becoming wholly or partially unserviceable for any reason, including
reasons beyond the Lessee's control. All payments hereunder shall be made
by the Lessee free and clear of any right of set-off or counterclaim.
6.10 The Lessee shall pay all taxes and other governmental charges on any
payment hereunder, and the Lessee shall pay to the Lessor together with
any payment hereunder, the applicable amount of value added tax (if any)
at the then applicable rate thereon. If value added tax or any other tax
or charge is assessed on a payment already made hereunder, the Lessee
shall at the request of the Lessor promptly reimburse the Lessor for such
tax or charge.
6.11 All payments hereunder shall be made free and clear of all deductions or
withholdings whatsoever. In the event that the Lessee is required by law
to make any deduction or withholding on account of tax or otherwise from
any such payments, or any new taxes or levies are imposed on such
payments, or there is
8(19)
an increase in the existing taxes or levies on such payments, the sum due
from the Lessee shall be increased to the extent necessary to ensure that,
after such deduction or withholding is made, the Lessor receives a net sum
equal to the sum which the Lessor would have received had no deduction or
withholding been made.
7 USE, MAINTENANCE AND ALTERATIONS
7.1 The Lessee shall use the Equipment in a careful and proper manner and in
accordance with the Technical Documents and any insurance required
hereunder. The Lessee shall ensure that the Equipment is only used and
operated by properly skilled personnel. The Lessee shall not use or permit
the Equipment to be used in contravention of any law or regulation or for
any purpose for which the Equipment is not designed and suitable.
7.2 The Lessee shall not do or permit to be done anything which may expose any
part of the Equipment to penalty, forfeiture, impounding, detention or
destruction and not abandon any part of the Equipment.
7.3 The Lessee shall, at its own expense, keep the Equipment in good working
order and condition and make all necessary adjustments, repairs and
replacements. The Lessee shall procure that all parts of the Equipment are
properly serviced in accordance with recommendations of the manufacturer
thereof and the Technical Documents. The lessee shall keep such records of
the maintenance and use of the Equipment as the Lessor from time to time
specifies.
7.4 The Lessee shall, at its own expense, obtain and keep in full force and
effect all permissions, licences and other authorisations which may at any
time be required in connection with the possession or use of the Equipment
and the due performance by the Lessee of its obligations under this
Agreement. The Lessee shall comply with all statutory and other official
obligations relating to the possession and use of the Equipment and shall
at its own expense add to or install with the Equipment any safety or
other equipment required by any applicable law or regulation to be so
added or installed for the lawful use or operation of the Equipment.
7.5 Subject as provided herein, the Lessee may not, without the prior written
approval of the Lessor, permanently remove any part from, or alter or make
additions to Equipment. Such written approval shall be without
responsibility on the part of the Lessor for any interference with the
operation of the Equipment or impairment of its value.
7.6 The Lessee shall solely bear the responsibility for theft of the
Equipment, and all damage to the Equipment, whether caused by criminal
actions or vandalism or otherwise arising. If the Equipment is lost or
damaged in whole or in part, the Lessee shall promptly replace or repair
the Equipment as appropriate. Any insurance proceeds received by the
Lessor in respect of any such loss or damage shall be paid to the Lessee
when the Lessor has received satisfactory evidence that the Equipment has,
or will be, replaced or repaired in accordance with this Agreement.
7.7 All alterations and additions to the Equipment and all replacements of the
Equipment shall, unless otherwise agreed in writing by the Lessor,
immediately upon installation or replacement, as the case may be, become
the property of the Lessor.
9(19)
7.8 The Lessee shall keep the Equipment at the Location and may not remove it
to a different location without the prior written approval of the Lessor.
The Lessee may not sublease or part with possession of the Equipment
without the prior written approval of the Lessor.
8 INDEMNITIES
8.1 The Lessee shall be liable for any personal injury or death or property
damage arising from or related to the possession, use or operation of the
Equipment.
8.2 The Lessee shall indemnify and hold the Lessor harmless from and against
any and all liabilities, claims, proceedings, costs and expenses
whatsoever arising out of or in any way connected with any breach of this
Agreement by the Lessee, or the possession, use or operation of the
Equipment or arising on the grounds that any part of the Equipment or the
use thereof constitutes an infringement of any patent, copyright, design
or similar right.
8.3 The Lessee shall be responsible for and reimburse the Lessor against all
taxes, duties and other charges levied or imposed against the Lessor or
the Lessee and relating to this Agreement or the Equipment except for
taxes on the Lessor's overall income.
8.4 The indemnities contained in this Clause 8 shall not extend to any loss to
the extent that such loss is caused by the wilful misconduct or gross
negligence of the Lessor or the failure by the Lessor to comply with this
Agreement.
8.5 The indemnities contained in this Clause 8 shall continue in full force
and effect notwithstanding the expiry of the Lease Period or the
termination of this Agreement.
9 INSURANCES
9.1 From the Delivery Date until the Equipment has been returned to the Lessor
or purchased by the Lessee hereunder, the Lessee shall purchase and
maintain an all-risk insurance covering loss, damage or destruction of the
Equipment in an amount equal to or in excess of the Termination Value from
time to time, and all other risks normally covered by an insurance of
equipment of the same kind, including third party liability and product
liability. Should an Event of Loss occur, the procedure set forth in this
Article 9 below will apply.
9.2 All insurances shall be placed with an international insurer with
recognized reputation and responsibility satisfactory to Lessor.
Furthermore, the insurances shall name the Lessor as the owner of the
Equipment and shall be made payable, in the case of policies covering loss
or damage to the Equipment, to the Lessor.
9.3 The Lessee shall before each renewal date of an insurance furnish to the
Lessor evidence that the insurance required to be maintained hereunder
remains in full force and effect. On request, the Lessee shall provide the
Lessor with all other information about, or documents regarding, the
insurances maintained in respect of the Equipment.
9.4 If the Lessee does not provide evidence that the insurance coverage
complies with this Agreement, the Lessor shall be entitled to take out
such insurance, and all costs therefor shall be reimbursed by the Lessee
on demand.
10(19)
9.5 The Lessee will not do, or omit to do, or permit to be done anything
whereby any required insurance would be rendered invalid or unenforceable
or the Equipment in any respect not covered by the required insurance.
9.6 As between Lessor and Lessee, it is hereby agreed that all insurance
proceeds received under policies required hereby, with respect to the
Equipment, will be applied as follows:
Upon the occurrence of any Event of Loss, with respect to the Equipment or
any part of the Equipment, Lessor shall be entitled to and shall receive
the entire award, judgement, settlement insurance proceeds or payments and
all instalments thereof. Lessee hereby assigns to Lessor any right or
interest Lessee may have or may hereafter acquire in any such award or
payment; provided that unless an Event of Default shall have occurred and
be continuing, Lessee shall be entitled to reimbursement for the amount of
such award, judgement, settlement, insurance proceeds or payments actually
received by Lessor upon the fulfilment of Lessee's obligation to pay any
amount stipulated under Subarticle 9.7 hereof
9.7 Upon the occurrence of any Event of Loss with respect to the Equipment,
Lessee shall, on the 30th day following the date on which the Event of
Loss shall have been declared by Lessor, pay or cause to be paid in
immediately available funds:
(i) the Termination Value in effect as of such date for the Equipment
and
(ii) any other unpaid amounts due hereunder.
At such time as Lessor has received the sum of (i) and (ii) above, with
any applicable reduction where insurance proceeds have been applied to pay
the sum of (i) and (ii) above, the obligation of Lessee to pay rent
hereunder shall terminate and Lessor will transfer to Lessee, without
recourse or warranty, all of Lessor's right, title and interest, if any,
in and to the Equipment (except software which Lessee takes possession of
but not title, as fully described under the heading Software License of
the Supply Agreement). The balance, if any, of such insurance proceeds
remaining thereafter will be paid to the order of Lessee.
9.8 In the event of damage to the Equipment or any part thereof not
constituting an Event of Loss, Lessee shall promptly notify Lessor in
writing of such damage and shall remain obligated to make all payments of
rent which may become due hereunder in the same manner as if such damage
had not occurred. Lessee shall repair and restore the Equipment or any
part thereof to the condition required by Article 7 hereof. So long as no
Event of Default shall have occurred and be continuing, Lessee shall be
entitled to receive the entire award, judgement, settlement, insurance
proceeds or payments and all instalments thereof with respect to such
damage, to the extent received by Lessor and as provided in this Article
9.
9.9 Notwithstanding anything to the contrary contained in this Article 9, upon
the occurrence of an Event of Loss with respect to any part of the
Equipment under circumstances where there has not been an Event of Loss
with respect to the Equipment, Lessee shall, as promptly as is reasonably
possible, duly convey to Lessor, as replacement for any part of the
Equipment having suffered an Event of Loss, title to another part of the
Equipment of the same manufacturer and of the same or an improved model
suitable for installation and use on the Equipment as the part of the
Equipment having suffered an Event of Loss. Such replacement part shall be
free and clear of all liens, encumbrances or rights of others whatsoever
(other than a lien, mortgage or other encumbrance arising from Lessor's
own act of default and have a value and utility at least equal to, and be
in as good operating condition as, the part of the Equipment with respect
to which an Event of Loss has occurred [illegible]
11(19)
such part of the Equipment were in the condition and repair as required by
Article 7 hereof prior to such Event of Loss.
10 INFORMATION
10.1 At the request of the Lessor, the Lessee shall promptly furnish to the
Lessor:
(a) a detailed inventory of the Equipment, specifying the condition;
(b) all records of the maintenance and use of the Equipment;
(c) all other information in the Lessee's possession regarding the
Equipment, its use, location and condition;
(d) certified copies or other satisfactory evidence of certificates,
licences, permits and authorisations necessary or desirable in
connection with the possession or use of the Equipment or the due
performance by the Lessee of its obligations under this Agreement;
(e) a written confirmation, signed by a duly authorised officer of the
Lessee, confirming that no Default is subsisting;
(f) budget and projections for the Lessee's operations during the
current calendar year; and
(g) other information specified in the Special Terms.
10.2 The Lessee shall send to the Lessor within thirty (30) days of the
completion of the preparation of, but in any event not later than six
months after the expiry of the financial year, the annual financial report
of the Lessee and each Security Provider for the preceding financial year.
The Lessee shall also send to the Lessor within thirty (30) days of the
completion of the preparation of the quarterly financial reports of
Lessee.
10.3 The Lessee shall forthwith notify the Lessor of the occurrence of a
Default and of any other event which might adversely affect the Lessee's
ability to perform any of its obligations under this Agreement, or the
ability of any Security Provider to perform any of its obligations under
the Security Document to which it is a party, (including in particular
fire, theft, logistical problems, strikes, breakdown of any item of the
Equipment), and provide the Lessor with full details of any steps which
the Lessee (or the relevant Security Provider) is taking, or is
considering taking, in order to remedy or mitigate the effect of the
Default or otherwise in connection with such events.
10.4 The Lessee shall promptly inform the Lessor of the expiry, or termination
of any licence consent or authorisation which the Lessee is obliged to
maintain under this Agreement and provide the Lessor with evidence of any
new or renewed licences, consents and authorisations, as they become
effective.
11 OWNERSHIP AND MARKING
11.1 The Equipment shall at all times be and remain the sole and exclusive
property of the Lessor. The Lessee shall at its own cost and expense
protect and defend the ownership of the Lessor against all claims, liens
and legal proceedings of creditors of the Lessee and other persons, and
keep the Equipment free and clear from all claims, liens and proceedings
except for liens and charges created by or through
12(19)
the Lessor. The Lessee shall have no right, title or interest in or to the
Equipment except as expressly set forth in this Agreement. The Lessee
shall not hold itself out as owner of the Equipment and the Lessee may not
in its accounts or in any other document treat, or account for, the
Equipment as assets of the Lessee.
11.2 On each part of Equipment there shall at all times be affixed, and shall
not be removed or covered up, a fireproof plate or another permanent
marking, specifically approved by the Lessor bearing the inscription in
the Language: "This equipment is owned by AB X X ERICSSON FINANS". The
Lessee shall ensure that such name plates are not, during the term of this
Agreement, at any time obscured or removed.
12 EVENTS OF DEFAULT
12.1 The following events shall constitute Events of Default:
(a) the Lessee shall fail to pay any amount due under this Agreement
within three (3) Business Days after notice thereof has been given
to the Lessee;
(b) the Lessee shall fail to perform or observe any obligation, covenant
or agreement to be performed or observed by it hereunder (other than
the obligation to pay any amount due) and such failure shall, if
capable of being remedied, continue unremedied for a period of ten
(10) Business Days after notice of such breach has been given to the
Lessee;
(c) this Agreement for any reason shall become wholly or partially
unenforceable as against the Lessee;
(d) the Lessee or any Security Provider is or becomes insolvent or makes
a general assignment for the benefit of, or a composition with, its
creditors or any steps are taken or legal proceedings are started
for the bankruptcy or winding-up of the Lessee or any Security
Provider or for the appointment of a receiver, administrator or
similar officer of the Lessee or any Security Provider or all of its
assets;
(e) any officer of any court or any other person takes any step towards
attaching, sequestrating, requisitioning, seizing or levying
distress on any part of the Equipment, or any part of the Equipment
is in fact so attached, sequestrated, requisitioned, seized or
distrained upon;
(f) the Lessee shall do or permit any act or thing which may adversely
affect the ownership or the rights of the Lessor in the Equipment or
any part thereof;
(g) the Lessee or any Security Provider shall discontinue all or a
substantial part of its business operations or transfer or dispose
of all or a material part of its assets;
(h) any representation or warranty made or repeated by the Lessee herein
shall prove to be incorrect or misleading in any respect deemed
material by the Lessor;
(i) the Lessee or any Security Provider shall not pay any indebtedness
when due or any indebtedness of the Lessee or any Security
13(19)
Provider shall become prematurely due or placed on demand as a
result of an event of default (howsoever described);
(j) the Equipment, the Lessee, any Security Provider, the business of
the Lessee or any Security Provider or any substantial part thereof
shall become nationalized;
(k) the Equipment shall become subject to a lien, charge or encumbrance
of any kind which is not created by or through the Lessor;
(l) any event or series of events shall occur which, in the reasonable
opinion of the Lessor, might have a materially adverse effect on the
business or financial condition of the Lessee or any Security
Provider, or on its ability to fully perform its obligations under
this Agreement or the Security Document to which it is a party, as
the case may be;
(m) any decision or agreement being made or entered into to merge or
consolidate the Lessee or any Security Provider, or its business
with any other company or business;
(n) any Security Document shall not constitute a legally valid and
enforceable security or guarantee, as the case may be;
(o) the realisable value of the Collateral shall be less than the
Termination Value; or
(p) other Event(s) of Default specified in the Special Terms.
12.2 Upon the occurrence of any Event of Default and at any time thereafter so
long as the same shall be continuing, the Lessor may, at its option,
declare this Agreement to be in default and the Lessor may, in addition to
any other remedies provided herein or by applicable law, exercise one or
more of the following remedies, as the Lessor shall in its sole discretion
elect:
(a) enter the premises of the Lessee or any other place where the
Equipment may be located and repossess the Equipment, disconnecting
and separating all thereof from any other property and using all
means necessary to do so;
(b) terminate this Agreement, which termination shall be effective
immediately upon the Lessor having given notice of termination to
the Lessee, whereupon the Lessee's right to possess and use the
Equipment shall immediately cease;
(c) recover all Rent Payments and other payments due as of the date of
such default;
(d) request payment of the Termination Value for the Equipment, upon
payment of which the Lessor shall take all steps necessary for the
transfer of title to and ownership of the Equipment (except
software, which the Lessee takes possession of but not title to as
described in the Supply Agreement) "as is" and "where is" to the
Lessee;
(e) demand compensation against any loss, damage, cost, expense or
liability which the Lessor may sustain or incur as a consequence of
the occurrence of the Event of Default or in connection with the
14(19)
enforcement or preservation of any rights under this Agreement or
any Security Document.
12.3 The Lessee hereby waives any right of action against the Lessor arising
from the removal, repossession or retention of the Equipment following an
Event of Default. The Lessee undertakes to provide the Lessor with all
necessary assistance to perform the repossession of the Equipment
following an Event of Default.
12.4 If the Lessee fails to perform any of its obligations under this Agreement
and continues to do so thirty (30) days from receipt of notice from the
Lessor or when an Event of Default has occurred and is continuing, the
Lessor may itself perform such obligations for the account of the Lessee
without thereby waiving any rights hereunder, and any amount paid or
expense incurred in connection with such performance shall be reimbursed
by the Lessee on demand.
13 PURCHASE OPTION
13.1 The Lessor hereby grants to the Lessee an option to purchase the Equipment
(except software, which the Lessee takes possession of but not title as
described in the Supply Agreement) on the terms and conditions set out in
this Clause 13 and upon exercise of such option agrees to transfer to the
Lessee or its nominee title to and ownership of the Equipment.
13.2 The Lessee can exercise its purchase option on each Option Date, by paying
on the relevant Option Date the relevant Option Price to the Lessor, as
set forth in the Exhibit 2.
13.3 The right of the Lessee to exercise its purchase option is subject to the
following conditions:
(a) the Lessor shall have received, not later then three (3) months
prior to the relevant Option Date written notice of the Lessee's
intention to exercise the option; and
(b) no Default shall have occurred and be continuing when notice is
given or occur prior to the relevant Option Date or as a result of
the Lessee exercising the purchase option.
13.4 Once given, notice of the Lessee's intention to exercise the purchase
option shall be irrevocable.
13.5 When the Lessor has received the Option Price and all other amounts due
hereunder on the relevant Option Date, title to the Equipment (except
software, which the Lessee takes possession of but not title as described
in the Supply Agreement) shall vest in the Lessee.
13.6 The Equipment is sold "as is" and "where is". The Lessor warrants that,
immediately prior to transferring title to the Equipment, the Lessor will
have good title to the Equipment free from any liens, charges or
encumbrances created by or through the Lessor other than such that have
been agreed to by the Lessee. Except as aforesaid, the Lessor makes no
warranties, express or implied, whether statutory or otherwise, whether as
to the state of quality of the Equipment or as to description, repair or
fitness for any purpose or otherwise, and all such warranties are hereby
expressly excluded.
13.7 The Lessee shall pay to the Lessor on demand all costs and expenses
incurred. [illegible] Lessor in connection with the sale of the Equipment
under this Clause 13.
15(19)
13.8 Should the Lessee not exercise the purchase option, the Lessee may request
an extension of the Lease Period at market conditions to be agreed upon
between the parties. Such request shall be furnished to the Lessor in
writing six (6) months prior to the last day of the Lease Period. Should
the parties not have agreed on the conditions for the extension on the
last day of the Lease Period then the Equipment shall be returned in
accordance with Clause 14.
14 RETURN OF THE EQUIPMENT
14.1 On the last day of the Lease Period, the Lessee shall, unless the Lessee
has acquired title to the Equipment, at its own risk and expense,
forthwith return the Equipment together with the Technical Documents
unencumbered to the location the Lessor designates. The Equipment shall be
returned in good repair, only ordinary wear and tear resulting from proper
use in compliance with this Agreement excepted. The Lessee shall have no
right to be reimbursed for any improvement of the Equipment.
14.2 The Lessee shall be responsible for the proper packing of the Equipment
and for shipment and delivery (including payment of freight and insurance)
of the Equipment to the place designated by the Lessor.
15 REPRESENTATIONS AND WARRANTIES
15.1 The Lessee represents and warrants to the Lessor that:
(a) it is duly organised and validly existing under the laws of the
relevant jurisdiction as a limited liability company or other kind
of business entity as described in the recital to this Agreement,
with full power, authority and legal right to carry on its business
as presently conducted, to own its property and to execute, and to
perform all of its obligations under, this Agreement, and all action
required to authorise such execution and performance has been duly
taken;
(b) its operations, and the execution and performance of this Agreement,
have not and will not violate any applicable law or regulation or
contravene any provision of its constituent documents;
(c) all governmental or other licences, consents and authorisations
necessary or desirable for the execution and performance of this
Agreement have been obtained and are in full force and effect;
(d) this Agreement constitutes legally valid and binding obligations of
the Lessee, enforceable in accordance with its terms;
(e) it is not in breach of or in default under any agreement to which it
is a party or by which it or any of its assets is bound, which
breach or default might have a materially adverse affect on the
business or financial condition of the Lessee;
(f) no litigation, arbitration or administrative proceedings are current
or pending or, to its knowledge threatened, which might, if
adversely determined, have a materially adverse effect on its
business or financial condition, or its ability to perform its
obligations under this Agreement;
16(19)
(g) no Default is subsisting;
(h) the latest annual financial report of the Lessee has been prepared
in accordance with law and generally accepted accounting principles
in the relevant jurisdiction and represents fairly its financial
condition;
(i) all information provided to the Lessor in connection with this
Agreement is true, complete and accurate in all respects and the
Lessee is not aware of any fact or circumstance which has not been
disclosed to the Lessor and which might, if disclosed, be reasonably
expected to adversely affect the decision of a person considering
whether or not to enter into an agreement of this type with the
Lessee;
(j) there are no deductions or withholdings whatsoever, which have to be
made by the Lessee in respect of any payments hereunder;
(k) the copy of the Supply Agreement provided to the Lessor is true,
correct and complete;
(l) the Supply Agreement is in full force and effect and constitutes
legally valid and enforceable obligations of both parties thereto;
(m) it has fully complied with, and duly performed, its obligations
under the Supply Agreement;
(n) other representations and warranties specified in the Special Terms.
15.2 The representations and warranties set out in Clause 15.1 shall survive
the execution of this Agreement and shall be deemed to be repeated on the
Delivery Date, on the Initial Rent Payment Date, on the Lease Commencement
Date and on each Rent Payment Date, with reference to the facts and
circumstances then existing, as made at each such time.
16 RIGHTS, REMEDIES AND WAIVERS
16.1 The rights and remedies of the Lessor in relation to any misrepresentation
or breach of warranty on the part of the Lessee shall not be prejudiced by
any investigation by or on behalf of the Lessor or any of its affiliates
into the affairs of the Lessee, by the execution or the performance of
this Agreement or by any other act or thing which may be done by or on
behalf of the Lessor or any of its affiliates in connection with this
Agreement.
16.2 No course of dealing or waiver by the Lessor in connection with any
provision in this Agreement shall impair any right, power or remedy of the
Lessor with respect to any other provision, or be construed to be a waiver
thereof.
16.3 No course of dealing and no delay in exercising, or omission to exercise,
any right, power or remedy accruing to the Lessor upon any default under
this Agreement or any other agreement shall impair any such right, power
or remedy or be construed to be a waiver thereof or an acquiescence
therein. Nor shall the action of the Lessor in respect of any such
default, or any acquiescence by it therein, affect or impair any right,
power or remedy of the Lessor in respect of any other default.
17(19)
17 MISCELLANEOUS
17.1 The Lessor shall have the right to assign as security its rights under
this Agreement in whole or in part, and to pledge the Equipment as
security for any financing obtained by it. The Lessee undertakes to
respect and comply with any such assignment or pledge and to do all things
necessary or desirable to perfect and evidence any such assignment or
pledge.
17.2 Without prejudice to the Lessor's right to create a security over its
rights hereunder or over the Equipment, the Lessor may assign absolutely
its rights and obligations hereunder without the consent of the Lessee,
provided the Equipment is sold simultaneously to the assignee. The Lessee
shall at the request of the Lessor take all action necessary or
desirable in connection with any such assignment and sale. The Lessee may
not without the prior written consent of the Lessor assign any rights or
obligations hereunder.
17.3 Each party shall appoint an authorised representative who shall be
entitled to deal with all matters arising under this Agreement and sign
any certificate hereunder or under the Supply Agreement. Each authorised
representative may by notice in writing to the representative of other
party appoint a new authorised representative in his own place or as an
alternate for him.
17.4 All information, notices, communications, opinions and the like required
to be given by the Lessee or to be delivered to the Lessor hereunder, if
not in the English language, shall be accompanied by an English
translation. The English version of all such information, notices,
communications, opinions and other documents shall as between the parties
prevail in the event of any conflict with the non-English versions
thereof.
17.5 All notices and other communications under this Agreement shall be in
writing and either delivered by hand or sent by telex, telefax, registered
first-class mail or courier, in each case to the address, telex or telefax
number of the intended recipient as set out in the Special Terms or as
subsequently notified to the other party in accordance herewith. In case
of communication by telex or telefax, the original of the communication
shall be sent by first-class mail to the recipient. A notice delivered by
hand or sent by courier shall be effective when delivered at the address
specified for the recipient. A notice given by any other means shall be
effective when received by the recipient. A notice received on a
non-working day in the place of receipt or after office hours shall be
deemed to have been delivered on the following working day.
17.6 This Agreement supersedes all other agreements, oral or written, with
respect to the subject matter hereof, and contains the entire agreement
between the Lessor and the Lessee with respect to the transactions
contemplated hereunder.
17.7 The Lessee and the Lessor shall, from time to time, do and perform such
other and further acts and execute and deliver any and all other further
instruments as may be required by law or reasonably requested by either
party to establish, maintain and protect the respective rights and
remedies of the other party and to carry out and effect the intent and
purpose of this Agreement.
17.8 The terms and conditions of this Agreement are confidential and shall
neither in whole or in part be disclosed to any person nor published
without the prior written consent of the parties hereto, provided that
this Clause 17.8 shall not prevent disclosure as required by law or
ministerial or judicial or parliamentary authority or to the legal or
audit or taxation advisers or bankers of any party.
18(19)
17.9 Notwithstanding anything in this Agreement to the contrary, if any payment
by Lessee under this Agreement or the obligation to make the same or the
receipt of the same or the performance by either of the parties hereto of
any other of their obligations hereunder is following the execution of
this Agreement rendered unlawful or illegal in whole or in part by the act
of any government entity so as to render it impossible for the parties
hereto to comply with their respective obligations under this Agreement
then:
(a) the parties hereto shall forthwith negotiate with each other in good
faith with a view to making arrangements whereby such payment can be
made or received or other obligations performed in such manner,
place, currency, and other circumstances as shall be lawful and
legal and so as to achieve substantially the same result so far as
concerns the Lessor and the Lessee as would have been achieved had
such payment receipt or other obligation not been rendered unlawful
or illegal;
(b) if the parties hereto are unable to reach agreement under Subarticle
(a) above within one month after the date on which the relevant
payment was due to be made or received hereunder or the other
obligations were due to be performed either party hereto shall be
entitled, by notice in writing to the other, to terminate the Lease
Period on the latest date permitted by the relevant act of any
government entity.
On any termination of the Lease Period pursuant to this Subarticle 17.9
the Lessee shall pay to the Lessor an amount equivalent to the Termination
Value.
If and when Lessor has received full payment under this Subarticle 17.9 in
respect of the Equipment, title to the Equipment (except Software, which
Lessee takes possession of but not title as described the Supply
Agreement) shall be transferred from Lessor to Lessee or its designee, and
Lessor shall issue all other relevant documents necessary for such
transfer of title and change of registration of the Equipment, subject,
however, to Lessee indemnifying Lessor with respect to past and future
operations and obligations relating to the Equipment in accordance with
Article 8 of this Agreement. Lessee has no right to claim compensation
from Lessor with respect to the condition of the Equipment and confirm
that the condition of the Equipment on such transfer or title shall be
"as is, where is".
17.10 Lessor may set-off or withhold from any amount due and payable to Lessee
under this Agreement, any amount due and payable from Lessee under this
Agreement or any other agreement between the parties hereto.
(The following additional provisions shall only apply to this Agreement to
the extent provided in the Special Terms.)
17.11 At the request of the Lessor, the Lessee shall promptly sign and deliver
to the Lessor the required number of bills of exchange in the Language. In
the bills of exchange the date and the amount shall be left open. The
bills of exchange shall be in the form attached hereto as Exhibit 8. If
any amount hereunder is not paid when due, the Lessor shall be authorised
to date one or several of such bills of exchange, fill in the amount of
the overdue payment and to use such xxxx(s) of exchange to recover the
overdue payment.
17.12 Without advance notice the Lessor (or its nominee) shall at any time
during working hours have the right to enter the premises of the Lessee or
any other place where the Equipment may be located for the purpose of
inspecting the same or observing its use. Upon the execution of this
Agreement the Lessee shall
19(19)
provide the Lessor with an authorisation to this effect in the
Language, substantially in the form of Exhibit 9.
17.13 Upon the execution of this Agreement the Lessee shall provide the Lessor
with an unconditional authorisation for the Lessor (or its nominee) to
repossess the Equipment in the Language. Such authorisation shall be
substantially in the form attached hereto as Exhibit 10.
18 APPLICABLE LAW AND JURISDICTION
18.1 This Agreement shall in all respects be governed by and construed in
accordance with Swedish law.
18.2 Any dispute, controversy or claim arising out of or in connection with
this Agreement, or the breach, termination or invalidity thereof shall be
finally settled by arbitration in accordance with the Rules of the
Arbitration Institute of the Stockholm Chamber of Commerce. The arbitral
tribunal shall be composed of three arbitrators. The proceedings shall
take place in Stockholm and be conducted in the English language.
18.3 Notwithstanding Clause 18.2, the Lessor shall be entitled to institute
proceedings for the payment of any amount due hereunder, to enforce its
rights hereunder to inspect the Equipment, to repossess the Equipment and
to enforce bills of exchange in any competent court of law.
Exhibit 1 - Tranche 3
UK
Cisco* (pound) 21,425
IDNX* (pound) 36,606
PFA* (pound) 4,837
DASS2 (Part of Y3709 order) (pound) 70,400
--------------
Total (pound)133,268
--------------
FINLAND
Echo cancellors 61,600 FIM
* Note: Products marked with an asterix (*) include deliveries to RSL in France
and Germany.
1(1)
EXHIBIT 2
OPTION DATES AND PRICES
Option Price in per cent of the
Rent Payment Date Purchase Price
----------------- -------------------------------
8 71,63
12 40
16 25,81
19 14,12
1(1)
EXHIBIT 3
TERMINATION VALUE
Termination Value in
percent of the
Rent Payment Date Purchase Price
----------------- --------------------
1 100.00
2 100.00
3 100.00
4 100.00
5 93.19
6 86.20
7 79.01
8 71.63
9 64.04
10 56.24
11 48.23
12 40.00
13 36.60
14 33.10
15 29.51
16 25.81
17 20.02
18 18.12
19 14.12
20 10.00
If the Termination Value becomes due and payable on a Rent Payment Date, it
shall be the amount set out above. If the Termination Value becomes due and
payable on any other day, it shall be the amount set out above for the preceding
Rent Payment Date plus interest on such amount at the Interest Rate from the
preceding Rent Payment Date to the day when the Termination Value becomes due
and payable. If the Termination Value is not paid on the due date, Default
Interest will be payable on the Termination Value in accordance with Clause 6.7.
1(3)
EXHIBIT 5
CONSENT AND AGREEMENT
relating to
a supply agreement made between Ericsson Ltd., UK (the "Supplier") and RSL Com
Europe Ltd., UK (the "Assignor") and dated December 6, 1995 (the "Supply
Agreement")
and
a lease agreement made between AB X X Ericsson Finans (the "Assignee") as lessor
and the Assignor as lessee and dated April 10, 1996 (the "Lease Agreement").
Terms defined in the Lease Agreement and not otherwise defined herein shall bear
the same meaning when used herein.
1. Pursuant to Clause 3.1 of the Lease Agreement, the Assignor has assigned
to the Assignee all of the Assignor's rights and interest in respect of
the Equipment under the Supply Agreement, including in particular the
right to acquire title to and ownership of the Equipment Pursuant to
Clause 3.2 of the Lease Agreement, the Assignee has assumed certain of the
Assignor's obligations under the Supply Agreement, including in particular
the obligation to pay the Purchase Price. The Supplier hereby acknowledges
notice of and consents to the aforementioned assignment and assumption and
to all terms of Clause 3 of the Lease Agreement.
2. If the Lease Commencement Date has not occurred on or prior to the Final
Availability Date, the Assignee shall under Clause 3.6 of the Lease
Agreement be entitled to terminate the Lease Agreement by giving written
notice to the Supplier and the Assignor. Following such notice, the
Supplier agrees that the Supply Agreement shall apply between the Assignor
and the Supplier as if this Consent and Agreement had never been executed
and the Assignee shall have no rights or obligations under the Supply
Agreement.
3. The Supplier hereby acknowledges and accepts that the Assignor shall prior
to the Lease Commencement Date, in accordance with the Lease Agreement and
the authorities and instructions from time given by the Assignee, be
entitled to exercise certain of the rights under the Supply Agreement
assigned to the Assignee.
2(3)
4. The Supplier hereby acknowledges and accepts the assignment contained in
Clause 5.6 of the Lease Agreement, according to which any and all
guarantees, warranties and other rights (ownership excluded) given in
respect of the Equipment under the Supply Agreement and assigned to the
Assignee absolutely (as described in paragraph 1 hereof) shall for the
Lease Period be assigned to the Assignor. Following written notice from
the Assignee that the Lease Period has expired or terminated otherwise
than by the Assignor purchasing the Equipment, the aforementioned
assignment shall immediately terminate.
5. Amendments to the Supply Agreement:
[ ]
6. All notices and other communications under this consent an Agreement shall
be in writing and either delivered by hand sent by telex, telefax,
registered first class mail or courier in case of the Assignor or the
signer to the address, telex or telefax number set out in the Lease
Agreement, and in case of the Supplier to the address, telex or telefax
number set out in the Supply Agreement, or as subsequently notified by any
party to the other parties in accordance herewith. In case of
communication by telex or telefax, the original of the communication shall
be sent by first-class mail to the recipient. A notice delivered by hand
or sent by courier shall be effective when delivered at the address
specified for the recipient. A notice given by any other means shall be
effective when received by the recipient. A notice received on a
non-working day in the place of receipt or after office hours shall be
deemed to have been delivered on the following working day.
7. This Consent and Agreement shall in all respects be governed by and
construed in accordance with Swedish law.
8. Any dispute, controversy or claim arising out of or in connection with
this Consent and Agreement, or the breach, termination or invalidity
thereof, shall be finally settled by arbitration in accordance with the
Rules of the Arbitration Institute of the Stockholm Chamber of Commerce
(the "Institute"). The arbritral tribunal shall be composed of three
arbitrators. Unless the parties agree otherwise all arbitrators shall be
nominated by the Institute. The proceedings shall take place in Stockholm
and be conducted in the English language.
9. The parties agree that in the event that there are, at the time any party
desires to initiate arbitration proceedings against any other party
hereunder, pending or contemplated proceedings under the Lease Agreement
or the Supply Agreement, all proceedings shall be cumulated. If
3(3)
proceedings are pending under the Lease Agreement or the Supply Agreement,
the proceedings hereunder shall be referred to the arbitral tribunal for
such pending proceedings, unless the tribunal decides that a cumulation is
not expedient. If no proceedings are pending, one arbitral tribunal shall
be nominated for all proceedings. All arbitrators in such tribunal shall,
unless the parties agree otherwise, be nominated by the Institute.
Date: [ILLEGIBLE] Date: 10/4/96
ERICSSON LTD. RSL COM EUROPE LTD.
/s/ [ILLEGIBLE] /s/ [ILLEGIBLE]
-------------------------------- -----------------------------------
Date: 10 APRIL - 96
AB X X ERICSSON FINANS
/s/ [ILLEGIBLE]
--------------------------------
EXHIBIT 6
CERTIFICATE OF DELIVERY/ACCEPTANCE*
LEASE AGREEMENT dated
We hereby confirm that the equipment is duly delivered to/accepted by* us in
accordance with and subject to the provisions of the Supply Agreement, and that
the conditions of such equipment in all respects complies with the provisions of
the Lease Agreement.
The equipment __________________________________________________________________
was delivered to/Accepted by* us on ____________________________________________
in accordance with the invoice(s) No.___________________________________________
_______________________________________ __________________________________
(place) (Date)
RSL COM EUROPE LTD
_______________________________
(Signature)
* Delete as appropriate.
1(1)
EXHIBIT 7
RENT PAYMENTS
(Lease Commencement Date 0)
Percent of the Purchase Outstanding balance in
Rent Payment Date Price in each Rent Payment percent of the Purchase Price
----------------- -------------------------- -----------------------------
1 0 100
2 0 100
3 0 100
4 0 100
5 6,81 93,19
6 6,99 86,20
7 7,19 79,01
8 7,38 71,63
9 7,59 64,04
10 7,80 56,24
11 8,01 48,23
12 8,23 40,00
13 3,40 36,60
14 3,50 33,10
15 3,59 29,51
16 3,69 25,81
17 3,79 22,02
18 3,90 18,12
19 4,01 14,12
20 4,12 10,00
EXHIBIT 11
DATED 10 APRIL 0000
XXX COM EUROPE LIMITED
to
AB LM ERICSSON FINANS
DEBENTURE
THIS DEBENTURE is made the day of April 1996
BETWEEN:
(1) RSL COM EUROPE LIMITED (registration number 3040192) whose registered office
is at 0 Xxx Xxxxx Xxxxxx, Xxxxxxxxxxx, Xxxxxx XX0X 0XX, Xxxxxxx ("the Company");
and
(2) AB LM ERICSSON FINANS, a Swedish limited liability company ("the Chargee").
NOW THIS DEED WITNESSETH as follows:
1. The Company hereby:
1.1 COVENANTS with the Chargee to pay and discharge as and when the same
fall due all its indebtedness and other obligations to the Chargee both present
and future and howsoever arising whether solely or jointly with any other person
and whether as principal or surety including interest thereon at such rate as
may be agreed in writing from time to time between the Company and the Chargee
and whether before or after the execution of this Debenture and together also
with all charges costs and expenses payable in connection therewith
(collectively "the Secured Liabilities"); and
1.2 with full title CHARGES in favour of the Chargee by way of floating
charge the whole of its undertaking and all its property assets and rights
(collectively "the Charged Property") as a continuing security for the payment
and discharge of the Secured Liabilities.
2. Power is hereby reserved to the Company to create or leave outstanding any
Debenture, fixed charge or other security of whatsoever kind over the whole or
any part of the Charged Property but not a floating charge, such Debenture,
charge or security but not a floating charge to rank in point of security in
priority to the floating charge hereby created and the Chargee agrees at the
cost of the Company to execute such documents as the Company may reasonably
request to give effect hereto.
3. The moneys hereby secured shall become payable and all rights of the Company
to deal for any purpose whatever with the Charged Property or any part thereof
shall forthwith cease on the happening of any of the following events:-
3.1 if an order is made or an effective resolution passed for winding up
the Company
3.2 if a petition is presented or an order is made against the Company for
the appointment of an administrator
3.3 if the Company stops payment or ceases to carry on its business or
substantially the whole of its business or threatens to cease to carry on the
same or if the Company without the prior consent in writing of the Chargee shall
sell assign, charge, hire, lease or part with or share possession of or
otherwise dispose of the Charged Property or any part thereof or any interest of
the Company therein or purport to do so
3.4 if any encumbrancer takes possession or a receiver administrative
receiver or manager is appointed of all or any part of the property of the
Company;
3.5 if the Company makes any agreement or composition with its creditors
4. Further, the Chargee may under the hand of any of its officers or managers or
by deed appoint a Receiver or Receivers of the whole or any part of the Charged
Property only if at the time of such appointment a petition shall have been
presented applying for an administration order to be made in respect of the
Company.
A Receiver so appointed may (subject to statute) be removed in like
manner.
5. Every such Receiver shall:-
5.1 be the agent of the Company (which shall be solely responsible for his
acts defaults expenses and remuneration);
5.2 be remunerated at such rate as the Chargee shall determine;
5.3 have (and if more than one may exercise severally or jointly) the
powers set out in Schedule 1 to the Insolvency Xxx 0000;
5.4 (subject to the discharge of liabilities having priority to the
Secured Liabilities and save insofar as otherwise directed by the Chargee) apply
all money received by him first in the payment and discharge of his borrowings,
expenses, other liabilities and remuneration secondly, in or towards discharge
of the Secured Liabilities in such order as the Chargee may require and thirdly
in payment of any surplus to the Company or other person entitled thereto.
6. 6.1 This Debenture shall be in addition to and shall be independent of
every other security which the Chargee may at any time hold for any of the
liabilities of the Company to the Chargee. No prior security held by the
Chargee over the whole or any part of the Charged Property shall merge in the
security hereby constituted.
6.2 This Debenture shall remain in full force and effect as a continuing
security until discharge by the Chargee.
6.3 Nothing contained in this Debenture is intended to, or shall operate
so as to, prejudice or affect any xxxx, note, guarantee, Debenture, pledge,
charge or other security of any kind whatsoever which the Chargee may have for
the liabilities of the Company or any of them or any right, remedy or privilege
of the Chargee thereunder.
7. The Chargee shall not nor shall any Receiver appointed as aforesaid by reason
of him or the Receiver entering into possession of the Charged Property or any
part thereof be liable to account as chargee in possession or be liable for any
loss on realisation or for any default or omission for which a chargee in
possession might be liable but every Receiver duly appointed by the Chargee
under the powers in that behalf hereinbefore contained shall be deemed to be the
agent of the Company for all purposes and shall as sub-agent for all purposes be
deemed to be in the same position as a Receiver duly appointed by a chargee
under the Law of Property Xxx 0000 and every such Receiver and the Chargee shall
be
entitled to all the rights powers privileges and immunities by the said Act
conferred on chargees and receivers when such receivers have been duly appointed
under the Act
8. No purchaser chargee or other person or company dealing with the Chargee or
the Receiver or their respective agents shall be concerned to enquire whether
the moneys hereby secured have become payable or whether the power which the
Receiver is purporting to exercise has become exercisable or whether any money
remains due on this Debenture or to see to the application of any money paid to
the Chargee or to such Receiver
9. The Chargee and every Receiver attorney manager agent or other person
appointed by the Chargee hereunder shall be entitled to be indemnified out of
the Charged Property on a full indemnity basis in respect of all liabilities and
expenses incurred by him in the execution or purported execution of any of the
powers authorities or discretions vested in him pursuant to these conditions and
against all actions proceedings costs claims and demands in respect of any
matter or thing done or omitted in anyway relating to the Charged Property or
in connection with the perfection or enforcement or attempted enforcement of the
security hereby constituted or any other security held by the Chargee for the
liabilities of the Company to the Chargee or any guarantee to the Company in
respect thereof and the Chargee and any such Receiver may retain and pay all
sums in respect of the same out of any moneys received under the powers hereby
conferred
10. A notice may be served by leaving it at or by sending it through the post to
the registered office of the Company or to the Chargee at the address
hereinbefore set out (as the case may be) and any notice posted shall be deemed
to have been served at the expiration of seventy-two hours after it has been
posted and in proving service of such notice it shall be sufficient to prove
that the envelope containing the same was properly addressed stamped and posted
11. This Debenture shall be governed by and construed in accordance with English
law, and the Company hereby irrevocably submits to the non-exclusive
jurisdiction of the English courts.
12. Each of the provision contained in this Debenture shall be severable and
distinct from one another and if at any time any one or more of such provisions
is or becomes invalid, illegal or unenforceable, the validity, the legality and
unenforceability of each of the remaining provision of this Debenture shall not
in any way be affected, prejudiced or impaired thereby.
l3. The Chargee shall have a full and unfettered right to assign the whole or
any part of the benefit of this Debenture and the expression "the Chargee"
wherever used herein shall be deemed to include the assignees and other
successors, whether immediate or derivative, of the Chargee, who shall be
entitled to enforce and proceed upon this Debenture in the same manner as if
named herein. The Chargee shall be entitled to impart any information concerning
the Company to any such assignee or other successor or any participant or
proposed assignee, successor or participant.
14. 14.1 Any reference herein to any statute or to any provision of any statute
shall be construed as a reference to any statutory modification or re-enactment
thereof and to any regulations or orders made thereunder and from time to time
in force.
14.2 The Clause headings shall not affect the construction hereof.
15. The Company hereby certifies that its creation by this Debenture in favour
of the Chargee does not contravene any of the provisions of its Memorandum and
Articles of Association
IN WITNESS whereof the Company and the Chargee have executed this deed the day
and year first above written.
THE COMMON SEAL of )
RSL COM EUROPE LIMITED )
was hereunto affixed in )
the presence of: )
Director /s/ RSL Com Europe Limited
Secretary
SIGNED as a DEED by )
AB LM ERICSSON FINANS )
acting by )
)
Director /s/ AB LM Ericsson Finans
Director /s/ AB LM Ericsson Finans
EXHIBIT 12
SUB-LESSEE'S CONSENT
relating to a lease agreement made between AB X X Ericsson Finans ("Ericsson")
as lessor and RSL Com Europe Ltd ("RSL") as lessee and dated
_____________________ (the "Lease Agreement").
Terms defined in the Lease Agreement and not otherwise defined herein shall bear
the same meaning when used herein.
1. Pursuant to Clause 7.8 of the Lease Agreement, Ericsson has accepted that
RSL may sublease the Equipment to RSL Com OY, Finland, RSL Com France S.A.
and RSL Com Deutschland GmbH, on terms and conditions set out therein.
2. We, the undersigned sub-lessee hereby acknowledge and agree that (i) the
sub-lease arrangement between us and RSL shall terminate one day prior to
the expiration or termination for whatever cause of the Lease Agreement,
(ii) we shall be bound by the terms and conditions of the Lease Agreement,
including but not limited to provisions regarding the use and ownership of
the Equipment, (iii) Ericsson shall be third party beneficiary to the
sub-lease arrangement between us and RSL, and (iv) we will not in any way
hinder or obstruct Ericsson from re-taking possession of the Equipment
under the Lease Agreement.
3. We, the undersigned sublessee, hereby acknowledge and agree that (i)
Ericsson shall not be responsible for any loss or damage to us or any
third parties caused by the Equipment or Ericsson's performance of the
Lease Agreement, including but not limited to direct or indirect damages
such as loss of profit and (ii) we shall defend, indemnify and hold
harmless Ericsson from all claims, losses, damages, expenses (including
attorneys' fees), and other liabilities arising out of our use or
possession of the Equipment, to the fullest extent permitted by law.
4. The Consent shall in all respects be governed by and construed in
accordance with Swedish law.
5. Any dispute, controversy or claim arising out of or in connection with
this Consent or the breach, termination or invalidity thereof, shall be
finally settled by arbitration in accordance with the Rules of the
Arbitration Institute of the Stockholm Chamber of Commerce (the
"Institute"). The arbitral tribunal shall be composed of three
arbitrators. Unless the parties agree otherwise all arbitrators shall be
nominated by the Institute. The proceedings shall take place in Stockholm
and be conducted in the English language.
Date:
(SUB-LESSEE)
_______________________________
Date:
AB X X ERICSSON FINANS
_______________________________
