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EXHIBIT 10.2
[LOGO]
AGREEMENT
BETWEEN
THE ROYAL BANK OF SCOTLAND PLC
AND
CORGI CLASSICS LIMITED
(in respect of a Term Loan of GBP4,000,000)
Registered in Scotland No 90312 Registered Office:
00 Xx Xxxxxx Xxxxxx, Xxxxxxxxx XX0 0XX
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THIS IS AN IMPORTANT DOCUMENT. YOU SHOULD TAKE INDEPENDENT LEGAL ADVICE BEFORE
SIGNING AND SIGN ONLY IF YOU WANT TO BE LEGALLY BOUND.
THIS AGREEMENT is made between:-
(1) CORGI CLASSICS LIMITED; and
(2) THE ROYAL BANK OF SCOTLAND plc.
By which it is agreed as follows:-
1 PURPOSE, DEFINITIONS AND INTERPRETATION
1.1 This Agreement sets out the terms and conditions upon and subject
to which the Bank agrees to make available to the Borrower a loan
of GBP4,000,000 to fund the development of the Borrower's
business based in the United States of America and to provide
working capital for the Group's businesses in the United Kingdom
and the United States of America.
1.2 In this Agreement unless the context otherwise requires:-
"BANK" means The Royal Bank of Scotland plc and its successors and
assigns;
"BASE ACCOUNTS" means the audited financial statements of the
Borrower and the consolidated audited financial statements of the
Group for the period ended 31 March 2000;
"BASE RELATED RATE" shall have the meaning ascribed to it in Clause
4.1;
"BORROWER" means Corgi Classics Limited, Company Number 03034370;
"BUSINESS DAY" means a day (other than a Saturday or Sunday) on
which banks are open for general business in London;
"CORGI CLASSICS, INC." means Corgi Classics, Inc., a company
registered in the United States of America and having its address
at Xxxxx 000, 000 Xxxx Xxxx, Xxxxxxx, XX 00000 XXX;
"CORPORATE OFFICE" means the Bank's Leicestershire Corporate
Business Centre at Xx Xxxx'x Xxxxx, Xxxx Xxxxxx, Xxxxxxxxx XX0 0XX
or such other branch/office as the Bank may notify to the Borrower
from time to time;
"EVENT OF DEFAULT" means any of the events described in Clause 13;
"GAAP" means generally accepted accounting practice in the United
Kingdom;
"GROUP" means at any time the Borrower and its Subsidiary
Undertakings at such time;
"ICON" means Icon Collectibles Limited, Company Number 03542813;
"INTEREST PERIOD" means each period for the calculation of interest
ascertained pursuant to Clause 3;
"IIH" means Interval Investment Holdings Ltd, a company registered
in the British Virgin Islands and having its address at PO Box 119,
Palm Xxxxxxxx, Road Town Tortola, British Virgin Islands;
"LIBOR" means the rate at which Sterling deposits of comparable
amount to the Loan and for the relevant Interest Period are offered
to the Bank in the London Interbank Market at or about 11 a.m. on
the first day of such Interest Period;
"LIBOR Related Rate" shall have the meaning ascribed to it in
Clause 4.1;
"LLEDO" means Lledo Collectibles Limited, Company Number 03229017;
"LOAN" means GBP4,000,000 or (as the context may require) the
principal amount owing to the Bank under this Agreement at any
relevant time;
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"MARGIN" means a rate of 1.5% per annum until 31st March 2002.
Thereafter the rate will be calculated with reference to the
following table, dependent upon the ratio of PBIT to Borrowing
Costs achieved pursuant to Clause 11.1(c). The Margin will be
reviewed annually on receipt of the audited financial statements of
the Borrower pursuant to Clause 10.3(a)(i) and the relative
certificate of compliance produced pursuant to Clause 10.3(a)(v)
and the resultant Margin will be backdated to the beginning of the
Borrower's current financial year and will apply for the whole of
that financial year.
Ratio Margin to apply
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Less than 2.25 : 1 1.75% (subject to Bank's agreement
being given pursuant to Clause 13.2)
2.25 : 1 (or greater) and less than 4 : 1 1.50%
4 : 1 and above 1.25%
The Bank will notify the Borrower in writing of any changes in the
Margin and if there is any dispute as to the calculation by the
Bank of the Margin to apply, the decision of the Bank will, in the
absence of manifest error, be conclusive and binding on the
Borrower;
"PARENT" means Corgi Classics Holdings Limited, Company Number
03811954;
"QUALIFYING BANK" means any bank which is for the purposes of
Section 349 of the Income and Corporation Taxes Act 1988 within the
charge to United Kingdom corporation tax as regards any interest
payable to it in terms of this Agreement;
"SBLC FACILITY AGREEMENT" means the facility agreement dated 28
July 1999 amongst (a) Zindart, (b) Xxx Xxxx Holdings Company
Limited and Xxx Xxxx Printing Holdings Limited, (c) ABN Amro Bank
NV and others, (d) ABN Amro Bank NV, Hong Kong Branch (as agent),
(e) ABN Amro Bank NV, Hong Kong Branch (as fronting bank) and (f)
others and the term loan between (i) the Parent and ABN Amro Bank
NV, London Branch, as such agreements may be amended, varied or
replaced;
"SUBSIDIARY" shall have the meaning ascribed to it in Section 736
of the Companies Xxx 0000;
"SUBSIDIARY UNDERTAKING" shall have the meaning ascribed to it in
Section 258 of the Companies Xxx 0000;
"TRADE RECEIVABLES" means the sum of up to US$5,400,000 outstanding
at the date hereof and due from the Borrower to Zindart (HK) in
respect of the purchase of products manufactured or sold by Zindart
(HK);
"ZINDART (BERMUDA)" means Zindart Limited, a company registered in
Bermuda and having its address at Xxxxxxxxx Xxxxx, 0 Xxxxxx Xxxxxx,
PO Box HM666, Xxxxxxxx HMCX, Bermuda ; and
"ZINDART (HK)" means Zindart Limited, a company registered in Hong
Kong and having its address at Xxxx X&X, 00 X0, Xxxxx 0, Xxx Ping
Industrial Centre, 57 Xxxx Xxx Road, Tai Po, New Territories, Hong
Kong.
1.3 Headings in this Agreement are inserted for convenience only and
shall be ignored in construing this Agreement. Unless the context
otherwise requires, words denoting the singular number only shall
include the plural and vice versa.
2 DRAWING OF THE LOAN
2.1 The Loan shall be drawn in one amount following receipt by the Bank
at the Corporate Office of a notice specifying the required date of
drawdown which must be a Business Day and, if appropriate, the
duration of the first Interest Period. Such notice must be received
not later than 11 a.m. on the drawdown date.
2.2 The Bank unless otherwise mutually agreed shall credit the Loan
to a current account of the Borrower with the Bank.
2.3 In the event of the Loan not being drawn within 3 months from the
date this Agreement is signed on behalf of the Bank, the Bank shall
be entitled to cancel this Agreement and the Borrower shall
indemnify the Bank against any loss (including any loss of margin)
or expense which the Bank shall certify as sustained or incurred by
it as a consequence.
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3 INTEREST PERIODS
3.1 If the Borrower elects to pay interest at the LIBOR Related Rate
the first Interest Period shall begin on the date on which the Loan
is drawn or, if appropriate, the date on which conversion to the
LIBOR Related Rate pursuant to Clause 4.1 occurs and, so long as
the option to convert to the Base Related Rate pursuant to Clause
4.1 is not exercised, each subsequent Interest Period shall begin
on the expiry of the preceding Interest Period with the final
Interest Period ending on the date on which the Loan is repaid in
full.
3.2 The Borrower may by notice to be received by the Bank at the
Corporate Office not later than 11 a.m. on the first day of each
Interest Period select an Interest Period of three, six, nine or
twelve months duration (or such other period which is acceptable to
the Bank). If the Borrower should fail to select an Interest Period
the Bank shall select the Interest Period to apply.
3.3 If an Interest Period should end on a day which is not a Business
Day such Interest Period shall be extended to the next Business Day
unless the next Business Day is in the following calendar month in
which case the Interest Period shall end on the preceding Business
Day.
3.4 If a repayment instalment referred to in Clause 6 should fall to be
paid during an Interest Period the Bank may determine the Interest
Period to apply to the amount of the repayment instalment and in
such circumstances, no penalty, fees or breakage costs (including
those referred to in Clauses 6.2 and 6.3) will be due by the
Borrower to the Bank as a result of such determination.
4 INTEREST
4.1 The Borrower shall have the option of electing to pay interest at a
rate linked to the Bank's Base Rate (the "Base Related Rate") in
accordance with the provisions of Clause 4.2 or at a rate linked to
LIBOR (the "LIBOR Related Rate") in accordance with the provisions
of Clause 4.3. Furthermore the Borrower may during the term of the
Loan convert the rate at which interest is payable from the Base
Related Rate to the LIBOR Related Rate and vice versa provided
always that the option to convert may be exercised no more
frequently than once every 3 months and provided further that
conversion from the LIBOR Related Rate to the Base Related Rate may
take place only at the end of an Interest Period.
4.2 If the Borrower elects to pay interest at the Base Related Rate the
following conditions shall apply:-
(a) the Borrower shall pay to the Bank interest at a rate
which is equivalent to the Margin above the Bank's Base
Rate. As at 18th January 2001 this formula produced a
rate of 7.5% per annum. The Bank's Base Rate may vary
from time to time.
(b) interest on the Loan shall be calculated on a daily basis
and a year of 365 days and shall be payable quarterly on
the penultimate Business Day of March, June, September
and December in each year and on final repayment of the
Loan. If the option to convert to the LIBOR Related Rate
is exercised the interest outstanding shall be payable on
the date of such conversion. Any interest unpaid when
payable shall be compounded.
4.3 If the Borrower elects to pay interest at the LIBOR Related Rate
the following conditions shall apply:-
(a) the Borrower shall, in respect of each Interest Period,
pay to the Bank interest at a percentage rate per annum
equal to the aggregate of (i) the Margin above LIBOR; and
(ii) the percentage rate which represents the cost to the
Bank, relative to the Loan, of compliance with the
requirements of the Bank of England, the Financial
Services Authority or any other regulatory authority.
Such cost shall be determined by the Bank, in accordance
with the formula detailed in Schedule 1 to this
Agreement, as at 11 a.m. on the first day of the Interest
Period. A certificate by the Bank as to the amount of
such cost shall be conclusive in the absence of manifest
error; and
(b) interest shall be calculated on a day to day basis on a
year of 365 days and shall be paid quarterly on the
penultimate Business Day of March, June, September and
December in each year, and on final repayment of the
Loan. Any interest unpaid when payable shall be
compounded.
4.4 Interest shall unless otherwise mutually agreed be debited to a
current account maintained by the Borrower with the Bank.
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4.5 If a repayment installment or any interest referred to in Clause 6
and Clause 4 respectively should not be paid by the Borrower on the
due date or if the Bank has served a written notice on the Borrower
pursuant to Clause 13.1 the Borrower shall pay interest on the
amount of the repayment installment or interest or (in the case of
a written notice having been served pursuant to Clause 13.1) the
amount of the Loan outstanding from the due date until the date of
actual payment at a rate of the Margin plus 2% per annum above the
Bank's Base Rate. This interest shall be charged both before and
after court decree or judgment, shall be in substitution for any
other interest payable pursuant to this Agreement and applicable to
such outstanding amount and shall be calculated on a day to day
basis and a year of 365 days and payable quarterly on such dates as
will be notified to the Borrower by the Bank.
5 INCREASED COSTS
5.1 If by reason of (i) the introduction of or any change in law or its
interpretation or administration and/or (ii) compliance with any
request or requirement of any central bank or other fiscal,
monetary or other authority (including without limitation, a
request or requirement which affects the manner in which the Bank
allocates capital resources to its obligations hereunder):-
(a) the Bank incurs a cost as a result of entering into this
Agreement performing its obligations and/or assuming or
maintaining its commitment hereunder and/or making the
Loan available; or
(b) the Bank is unable to obtain the rate of return on its
overall capital which it would have been able to achieve
but for its entering into this Agreement, performing its
obligations and/or assuming or maintaining its commitment
hereunder and/or making the Loan available; or
(c) there is any increase in the cost to the Bank of funding
or maintaining all or any of the advances comprised in a
class of advances formed by or including the Loan; or
(d) the Bank incurs a cost as a result of its having made the
Loan available or the Bank becomes liable to make any
payment on account of tax or otherwise (other than a tax
imposed on its overall net income) on or calculated by
reference to the amount of the Loan and/or any sum
received or receivable by it hereunder, or any liability
in respect of any such payment is imposed, levied or
assessed against the Bank
then the Borrower shall from time to time within three Business
Days of a demand by the Bank, pay to the Bank amounts sufficient to
indemnify the Bank against, as the case may be, (i) such costs,
(ii) such reduction in the rate of return (or such proportion of
such reduction as is in the opinion of the Bank attributable to its
obligations hereunder), (iii) such increased costs (or such
proportion of such increased costs as is in the opinion of the Bank
attributable to its funding the Loan), or (iv) such cost or
liability (or such proportion thereof as is in the opinion of the
Bank attributable to making the Loan available) save to the extent
that the relevant cost, increased cost, reduction or liability is
compensated for by any payment calculated in accordance with point
(ii) of Clause 4.3(a).
5.2 If the Bank makes a claim pursuant to Clause 5.1 it shall promptly
after it becomes aware of the circumstances giving rise to such
claim deliver to the Borrower a certificate to that effect setting
out in reasonable detail the basis of such claim. This certificate
shall be conclusive in the absence of manifest error.
6 REPAYMENT AND PREPAYMENT
6.1 The Borrower shall repay the Loan by:-
(a) 3 installments of GBP200,000;
(b) thereafter, 4 installments of GPB250,000; and
(c) thereafter, 8 installments of GBP300,000.
The first installments shall be paid on 30th September 2001 with
subsequent installments being paid quarterly thereafter until the
Loan has been repaid in full.
6.2 The Borrower may prepay the Loan or part thereof (this part to be
GBP100,000 or an integral multiple thereof) at any time (where
the Borrower has elected to pay interest at the Base Related Rate)
or (where the Borrower has elected to pay interest at the LIBOR
Related Rate) on the last day of any Interest Period (other than an
Interest Period determined by the Bank pursuant to Clause 3.4)
subject to the Borrower
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making an additional payment to the Bank equivalent to three
months' interest on the sum prepaid at the rate then current for
the Loan and subject also to notice from the Borrower to be
received by the Bank at the Corporate Office no later than 11 a.m.
two Business Days before such prepayment.
6.3 In the event of any repayment or prepayment of the Loan or part
thereof being made other than as stated in Clauses 6.1 or 6.2
(including any repayment or prepayment following the occurrence of
an Event of Default) the Borrower shall, in addition to making an
additional payment as detailed in Clause 6.2, indemnify the Bank
against any loss (including loss of margin) or expense which the
Bank shall certify as reasonably sustained or incurred by it as a
consequence of the repayment or prepayment.
6.4 Any repayment or prepayment made under Clause 6.2 and/or 6.3 shall
be applied against the outstanding instalments under Clause 6.1 in
inverse chronological order.
6.5 No amount repaid or prepaid may be redrawn under this Agreement.
7 PAYMENTS
7.1 All payments to be made by the Borrower under this Agreement shall
be made to the Bank on the due date.
7.2 The amount of any payment shall unless otherwise mutually agreed be
debited to a current account maintained by the Borrower with the
Bank and the Borrower shall if required by the Bank grant to the
Bank and maintain an appropriate Standing Order.
7.3 If any payment should become due on a day which is not a Business
Day the due date for such payment shall be extended to the next
Business Day unless the next Business Day is in the following
calendar month in which case the due date shall be the preceding
Business Day.
8 CONDITIONS PRECEDENT
8.1 The Bank shall be under no obligation to make the Loan available
until it has received the following and is satisfied with the
same:-
(a) the duplicate of this Agreement signed on behalf of the
Borrower;
(b) a certified copy of the Resolution of the Board of
Directors of the Borrower approving the transaction
contemplated by this Agreement and authorising a
specified person to sign this Agreement and any documents
required under this Agreement on behalf of the Borrower;
(c) deeds of subordination regulating the facilities granted
to the Borrower by (i) the Bank, and (ii) facilities in
aggregate of GBP8,106,000 granted by Zindart (HK) and
the Parent, in form and substance satisfactory to the
Bank;
(d) legal opinions addressed to the Bank, provided by the
Borrower's legal advisers, on Zindart (HK) and Corgi
Classics, Inc. in form and substance satisfactory to the
Bank and the Bank's legal advisers;
(e) evidence satisfactory to the Bank that (i) Corgi
Classics, Inc. and Zindart (Bermuda) are wholly owned
Subsidiaries of the Borrower;
(f) letters of consent addressed to Zindart (HK) and to the
Parent respectively from (i) ABN Amro Bank NV and the
Instructing Banks (all as defined in the SBLC Facility
Agreement) and (ii) ABN Amro Bank, London, agreeing to
the provision of the Loan to the Borrower and, where
appropriate, to the security granted or to be granted in
terms of Clause 12.1;
(g) a post closing obligations letter from Corgi Classics,
Inc. addressed to the Bank, in a form and substance
satisfactory to the Bank.
8.2 The Bank shall furthermore not be obliged to make the Loan
available unless the following conditions are satisfied on the date
on which the Loan is drawn:-
(a) the security referred to in Clause 12.1(b) has been
completed to the Bank's satisfaction;
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(b) no Event of Default (or event which with the giving of
notice, lapse of time or other conditions under this
Agreement may constitute an Event of Default) has
occurred and is continuing or might result from the
drawdown of the Loan; and
(c) the representations and warranties in Clause 9 are true
with respect to the facts and circumstances then
existing.
9 REPRESENTATIONS AND WARRANTIES
9.1 The Borrower represents and warrants (save as disclosed to and
agreed by the Bank) that:-
STATUS
(a) it and its Subsidiaries are duly incorporated and validly
existing and have power to own their property and assets
and carry on their business as presently conducted;
POWERS AND AUTHORITY
(b) it has power to execute, deliver and perform its
obligations under this Agreement and it and its
Subsidiaries have power to execute, deliver and perform
their obligations under any security provided by them
pursuant to Clause 12, all necessary corporate,
shareholder or other action has been taken to authorise
the execution, delivery and performance of this Agreement
and of any security provided, and no limitation on its
powers or the powers of its Directors shall be exceeded
as a result of the drawdown of the Loan;
LEGAL VALIDITY
(c) this Agreement and any security provided by it and its
Subsidiaries pursuant to Clause 12 constitute legal,
valid and binding obligations on it and its Subsidiaries
respectively;
NON-CONFLICT
(d) the entry into and performance of the terms and
conditions of this Agreement and of any security provided
by it and its Subsidiaries pursuant to Clause 12 do not
and shall not contravene or conflict with their
respective memoranda and articles of association, any
law, statute, regulation or other instrument binding on
it and its Subsidiaries or any of its/their assets, or
any agreement or document to which they are a party or is
binding on it or its Subsidiaries or any of their assets;
AUTHORISATIONS AND COMPLIANCE
(e) it and its Subsidiaries hold and are in compliance in all
material respects with (i) all necessary licences,
permits, consents or other authorisations required for
conducting their business and (ii) all applicable laws
and regulations or other legal requirements;
BREACH OF OTHER AGREEMENTS
(f) it is not (nor with the giving of notice, lapse of time
or satisfaction of any other condition would be) in
breach of or in default under any agreement or document
to which it is party or by which it or any part of its
assets may be bound which could have a material adverse
effect on the business, assets or financial condition of
the Borrower or on its ability to perform fully its
obligations under this Agreement or under any security
provided pursuant to Clause 12;
ACCOUNTS
(g) the Base Accounts/its latest audited financial statements
and the latest consolidated audited financial statements
of the Group as provided to the Bank have been prepared
in accordance with GAAP and fairly represent its
financial condition and the financial condition of the
Group and there has been no material adverse change in
its business or financial condition or the business or
financial condition of the Group since the date of those
financial statements;
LITIGATION
(h) no litigation, arbitration or administrative proceeding
is taking place (including without limitation any action
under any environmental law or regulation), pending or to
the knowledge of its officers threatened against it or
its Subsidiaries or any part of their undertaking, assets
or revenues which, if adversely determined would give
rise to a judgement or enforcement action for an amount
(in any one case) of more than GBP50,000;
ENCUMBRANCES
(i) no charges or other encumbrances in the nature of a
security interest exist on its assets or the assets of
any of its Subsidiaries other than any charges or
encumbrances in favour of the Bank
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or security rights arising in the ordinary course of
business by operation of law;
ENVIRONMENT
(j) so far as it is aware, it and its Subsidiaries (i) are in
compliance with all applicable environmental laws,
regulations and practices, (ii) hold and are in
compliance with all necessary licences, permits, consents
or other authorisations essential for the conduct of
their business; and (iii) has not previously conducted
nor are currently conducting their business in any manner
which could form the basis of any environmental claim
against them;
INFORMATION
(k) all written information provided to the Bank by the
Borrower regarding the Group is, so far as it relates to
facts, true and accurate in all material respects and, so
far as it consists of projections, such projections, when
made, were prepared in good faith, after careful
consideration and on the basis of reasonable assumptions
and there is no additional undisclosed information which
is in the possession of the Borrower, had it been
disclosed to the Bank, could have been reasonably
expected to cause the Bank to withdraw its offer of Loan
to the Borrower; and
NO DEFAULT
(l) no Event of Default has occurred.
REPETITION
9.2 The representations and warranties contained in Clause 9.1, (other
than 9.1(g) in respect of the Base Accounts, and 9.1k in respect of
information provided to the Bank prior to the date of this
Agreement) shall survive the signing of this Agreement and shall be
deemed repeated on the date on which the Loan is drawn and on each
date on which interest is payable.
10 UNDERTAKINGS
10.1 The undertakings in this Clause 10 shall remain in force until the
Loan has been repaid in full.
USE OF LOAN
10.2 The Borrower shall use the Loan for the purpose specified in Clause
1.1.
FINANCIAL INFORMATION
10.3 (a) The Borrower shall supply to the Bank:-
(i) as soon as they become available but in any
event within 180 days after the end of its
financial year the audited financial
statements of the Borrower and the
consolidated audited financial statements of
the Group for that year;
(ii) as soon as they become available but in any
event within 30 days after the end of the
accounting period to which they relate, and in
a format acceptable to the Bank, monthly
management accounts of the Borrower and
consolidated monthly management accounts of
the Group incorporating balance sheet and
profit and loss account, cash flow statement
and aged lists of debtors and creditors;
(iii) promptly all notices or other documents sent
by the Borrower to all or a class of its
shareholders and/or its creditors;
(iv) promptly such further information in the
possession of the Borrower regarding the
financial condition and operations of the
Borrower and the Group as the Bank may
reasonably request provided that (i) the Bank
will only be entitled to request additional
accounts of the Borrower if the Borrower is in
breach of the financial covenants set out in
Clause 11.1 or the Bank believes the Borrower
may be in breach of such covenants and (ii)
the Borrower will only be requested to pass
information to the Bank which may be subject
to confidentiality agreements if the Bank
satisfies any or all confidentiality requests
set out in such agreements;
(v) on each occasion financial statements are
supplied to the Bank pursuant to Clause
10.3(a)(i), a certificate, in a format annexed
as Schedule 2 to this Agreement, signed by a
Director/the Secretary of the Borrower
confirming compliance or otherwise with the
financial covenants detailed in Clause 11.1
outlining the financial covenant levels and
including detailed workings.
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(b) The Borrower undertakes to ensure that all accounts and
other financial information submitted to the Bank
pursuant to Clause 10.3(a) are prepared consistently and
in accordance with GAAP.
NOTIFICATION OF DEFAULT
10.4 The Borrower shall notify the Bank of any Event of Default
immediately upon becoming aware of its occurrence.
NEGATIVE PLEDGE
10.5 The Borrower shall not, nor shall it permit any of its Subsidiaries
to, create nor permit to subsist any charge, lien or other
encumbrance in the nature of a security interest (except a lien or
other security interest arising by the operation of law in the
ordinary course of business) on the whole or any part of the
present or future assets of the Borrower or its Subsidiaries except
with the prior written consent of the Bank.
OTHER OBLIGATIONS
10.6 The Borrower shall not, nor shall it permit any of its Subsidiaries
to, enter into any obligations whether by way of borrowing from
another source, leasing commitments, factoring of debts, granting
of guarantees or by any other means (other than as already
disclosed to the Bank prior to the date of this Agreement) except
(i) with the prior written consent of the Bank or (ii) any
liability in respect of any purchase price for products
manufactured or sold by Zindart (HK) or any of its Subsidiary
Undertakings or any manufacturer or supplier to the Group in the
normal course of business on arm's length commercial terms and, for
the avoidance of doubt, the Borrower shall not be prevented from
repaying such liabilities as referred to in points (i) and (ii) or
Trade Receivables to Zindart (HK).
MATERIAL CHANGE IN BUSINESS
10.7 The Borrower shall not, nor shall it permit any of its Subsidiaries
to, make or threaten to make any material change in the nature of
its business as presently conducted except with the prior written
consent of the Bank.
DISPOSAL OF ASSETS
10.8 The Borrower shall not, nor shall it permit any of its Subsidiaries
to, sell, transfer, lease (or where a lease is already in
existence, consent to the lease being assigned) or otherwise
dispose of all or a substantial part of the assets of the Borrower
or its Subsidiaries except with the prior written consent of the
Bank provided that, with the specific exception of those assets
detailed in Clause 10.10, disposals of assets (i) not exceeding
GBP50,000 in aggregate in any financial year or (ii) subject to
a floating charge only, made in the ordinary course of business of
the Borrower or the business of its Subsidiaries, shall be
permitted.
RESTRICTIONS ON REPAYMENT OF EQUITY/LOAN
10.9 The Borrower shall not without the prior written consent of the
Bank:-
(a) declare or pay or permit the payment of any dividend on
any of its shares; or
(b) pay or permit the payment of any unpaid arrears and
accruals of any dividend in respect of its share capital;
or
(c) any other distribution of income to any of its members;
or
(d) make any distribution of capital (whether in cash or in
specie) to its members; or
(e) redeem or purchase any of its shares; or
(f) otherwise reduce its capital; or
(g) without the prior consent of the Bank, repay any
equity/loan funding provided to it by any person other
than the Bank unless and until the Loan has been repaid
in full; or
(h) pay or permit the payment of any interest in respect of
any such loans or any fees, costs, expenses or
commission to the relevant lender.
TRADENAMES
10.10 The Borrower shall procure that all trademarks, tradenames, service
marks, logos, designs and emblems relating to the 'Corgi', 'Lledo'
and 'Icon' businesses shall, throughout the term of the Loan,
remain the sole and exclusive property of the Borrower or a Group
company which has granted appropriate security to the Bank and that
all other intellectual property rights used by the Borrower and the
Group in connection with its/their business shall throughout the
term of the Loan remain either the sole and exclusive property of
the Borrower or a Group company which has granted appropriate
security to the Bank or be used under valid licence agreements.
HEDGING
10.11 The Borrower shall, within 3 months from the date of drawdown of
the Loan, enter into an interest rate hedging instrument acceptable
to the Bank and the Borrower at a level, for a period and for a
notional
10
amount acceptable to the Bank and the Borrower.
INSURANCES
10.12 The Borrower shall, and shall procure that each of its Subsidiaries
shall, effect and maintain such insurance over its assets and
business in such manner and to such extent as is reasonable and
customary for a business engaged in the same or a similar activity
and the same or similar localities to the Borrower or its
Subsidiaries subject to the terms of any security provided by the
Borrower or its Subsidiaries.
CURRENT ACCOUNT
10.13 The Borrower shall maintain its current account banking business
with the Bank and with Standard Xxxxxxxxx Xxxx, XXX Xxx 00, Xxxx
Xxxx and Corgi Classics, Inc. shall maintain its current account
banking business with La Salle, 000 Xxxxx Xx Xxxxx Xxxxxx, Xxxxxxx,
XXX.
ENVIRONMENT
10.14 The Borrower shall, and shall procure that each of its Subsidiaries
shall:-
(a) comply with any applicable environmental laws,
regulations or practices and comply with and renew all
licences, permits, consents or other authorisations held
in respect of the Borrower's/its Subsidiaries business;
(b) conduct its business in a manner which cannot form the
basis of an environmental claim against it; and
(c) as soon as it becomes aware of the same, promptly notify
the Bank of any breach of any environmental law,
regulation or practice or any licence, permit, consent or
other authorisation held and remedy at the Borrower's
expense any such breach by the use of best available
techniques not entailing excessive cost.
AUTHORISATIONS AND COMPLIANCE
10.15 The Borrower shall, and shall procure that each of its Subsidiaries
shall:-
(a) comply in all material respects with all licences,
permits, consents or other authorisations held and with
any applicable laws, regulations or other legal
requirements; and
(b) as soon as it becomes aware of the same, promptly notify
the Bank of any breach of (i) any law, regulation or
other legal requirement and/or (ii) any licence, permit,
consent or other authorisation held, and immediately
remedy such breach.
ILLEGALITY
10.16 The Borrower shall on receiving notice from the Bank repay the Loan
either forthwith or on a future specified date together with
interest accrued to the date of repayment and all other amounts
payable under this Agreement by the Borrower if any change in or
the introduction of any law, regulation, treaty, official directive
or rule of any regulatory authority or organisation having
jurisdiction or any change in the interpretation or application
thereof should render it unlawful or a breach thereof for the Bank
to make available, fund or maintain the Loan or to give effect to
its obligations and exercise its rights contemplated by this
Agreement.
POST CLOSING OBLIGATIONS LETTER
10.17 The Borrower shall procure that Corgi Classics, Inc. satisfies its
obligations under the post completion obligations letter, dated of
even date herewith, from Corgi Classics, Inc. to the Bank.
11 FINANCIAL COVENANTS
COVENANTS
11.1 The Borrower undertakes that, in relation to the financial covenant
in (a) below at each date for compliance specified in Clause 11.3
and in relation to the financial covenants in (b) and (c) below for
each accounting period ending on such date, the financial
position/performance of the Group shall be/have been such that:-
MINIMUM NET TANGIBLE ASSETS
(a) Consolidated Net Tangible Assets are not less than the
amount set out in Column A below at any date for
compliance falling within the period detailed in Column B
below opposite such amount:-
11
Column A Column B
-------- --------
GBP9,000,000 date of drawdown of the Loan to 31 March 2003
GBP10,000,000 1 April 2003 to date of final repayment of the Loan
Net Cash Flow:Borrowing Costs Paid
(b) the ratio of Consolidated Net Cash Flow to Consolidated
Borrowing Costs Paid shall not be less than 1 : 1
PBIT:Borrowing Costs
(c) the ratio of Consolidated PBIT to Consolidated Borrowing
Costs shall not be less than the ratio set out in Column
A below for any accounting period ending during the
period detailed in Column B below opposite such ratio:-
Column A Column B
-------- --------
2.25:1 date of drawdown of the Loan to 31 March 2002
3:1 1 April 2002 to 31 March 2003
4:1 1 April 2003 to date of final repayment of the Loan
FINANCIAL DEFINITIONS
11.2 For the purposes of Clause 11.1 the following definitions shall
have the meanings shown opposite them:-
"Consolidated Borrowing Costs" means, in relation to any accounting
period of the Group, the aggregate of all interest, commission,
fees, and charges payable by the Group in respect of its
Consolidated Gross Borrowings during such period including without
limitation:-
(i) capitalised interest;
(ii) finance lease charges; and
(iii) dividends on shares issued on the basis that they are or
may become redeemable; but excluding interest payable by
associates and joint ventures;
"Consolidated Borrowing Costs Paid" means, in relation to any
accounting period of the Group, the aggregate of all interest,
commission, fees, and charges paid and due to be paid by the Group
in respect of its Consolidated Gross Borrowings during such period
including without limitation:-
(i) capitalised interest;
(ii) finance lease charges; and
(iii) dividends on shares issued on the basis that they are or
may become redeemable; but excluding interest paid by
associates and joint ventures;
"Consolidated Gross Borrowings" means at any time the aggregate of
all obligations of the Group for the repayment of money, whether
present or future, actual or contingent incurred in respect of:-
(i) money borrowed from all sources;
(ii) any bonds, notes, loan stock, debentures or similar
instruments;
(iii) acceptance credits, bills of exchange or documentary
credits;
(iv) shares issued on the basis that they are or may become
redeemable (at redemption value); (v) gross obligations
under finance leases;
(vi) the factoring of debts;
(vii) guarantees, indemnities or other assurances against
financial loss; and
(viii) amounts raised or obligations incurred in respect of any
other transaction which has the commercial effect of
borrowing.
For the avoidance of doubt, any liabilities in relation to trade
debts, including any amounts owing to Zindart (HK) and any of its
Subsidiary Undertakings which arise as a result of the supply of
goods and services to the Group in the normal course of business
and in relation to the Trade Receivables (the "Trade Debt"), shall
be excluded in computing Consolidated Gross Borrowings. However,
any amounts owed to Zindart (HK) and the Parent by the Group other
than the Trade Debt (including the GBP8,106,000 subordinated
loans outstanding at the date of this Agreement) shall be included
in computing Consolidated Gross Borrowings;
"Consolidated Net Cash Flow" means in relation to any accounting
period of the Group, the Group's net cash flow from operating
activities less the aggregate of (i) tax paid and (ii) Dividends
paid;
"Consolidated Net Tangible Assets" means at any time the aggregate
of the amount paid up or credited as paid up on the issued share
capital of the Borrower plus or minus (a) any amount standing to
the credit or debit of the consolidated capital and revenue
reserves of the Group (including any share premium account or
capital redemption reserve) and (b) any credit or debit balance on
the consolidated profit and loss account of the Group (excluding
for the avoidance of doubt any amount attributable to minority
interests),
12
LESS the aggregate of any amounts attributable to:-
(i) pension fund prepayments (net of related deferred tax
provisions), capitalised goodwill or any other intangible
assets;
(ii) shares issued on the basis that they are or may become
redeemable (at redemption value);
(iii) advance corporation tax recoverable or deferred tax assets;
and
(iv) the upward revaluation of any asset after 31 March 2000
except to the extent that such revaluation is approved in
writing for the purposes of this definition by the Bank;
"Consolidated PBIT" means, in relation to any accounting period of
the Group, the profit/loss of the Group on ordinary activities
before tax and after exceptional items but after ADDING back:-
(i) Consolidated Borrowing Costs (net of capitalised
interest and dividends on redeemable shares);
(ii) amortisation of goodwill and other intangible assets;
(iii) interest payable by associates and joint ventures;
(iv) the Group's share of operating losses arising in associates
and joint ventures; and
(v) the Group's share of exceptional losses arising in
associates and joint ventures;
and after DEDUCTING:-
(vi) the Group's share of operating profits arising in
associates and joint ventures;
(vii) interest receivable by associates and joint ventures;
(viii) the Group's share of exceptional gains arising in
associates and joint ventures;
(ix) interest receivable and other similar income; and
(x) income from fixed asset investments; and
"Dividends" means, in relation to any accounting period of the
Group, all dividends on the Borrower's:- (i) ordinary share
capital; and (ii) preference share capital (other than redeemable
preference shares).
COMPLIANCE DATES
11.3 (a) The dates for compliance with Clauses 11.1 are:-
(i) each date as at which the financial statements
produced pursuant to Clause 10.3(a)(i) are
prepared;
(ii) each date as at which the management accounts
produced pursuant to Clause 10.3(a)(ii) are
prepared for the financial periods ended 31
March and 30th September each year (commencing
30 September 2001); and
(iii) each date as at which any additional accounts
produced pursuant to Clause 10.3(a)(iv) are
prepared.
CALCULATION
11.4 The calculation of the financial covenants detailed in Clause 11.1
shall :-
(a) be confirmed by the Bank with reference to the financial
statements/accounts/compliance certificates produced
pursuant to Clause 10.3(a). The calculation of financial
covenants detailed in Clause 11.1 (b) and (c) which are
undertaken with reference to management accounts produced
in accordance with Clause 10.3(a)(ii) shall be based on
cumulative figures for the 12-month period ended on each
relevant date for compliance;
(b) be in accordance with the accounting principles and
policies applied in connection with the Base Accounts.
CONSISTENT APPLICATION OF ACCOUNTING PRINCIPLES
11.5 If any member of the Group (a) changes its accounting policies as
applied in connection with the preparation of the Base Accounts
whether as a result of a change in GAAP or otherwise, and/or (b)
changes its financial year end, it shall immediately notify the
Bank to determine whether the change affects the financial
covenants detailed in Clause 11.1 and the Borrower and the Bank
shall at the Bank's request negotiate in good faith with a view to
agreeing such amendments to the financial covenants and/or the
relevant definitions as set out in Clause 11.2 as may be necessary
to provide the Bank with protection comparable to that granted as
at the date of this Agreement. Any such amendments will be
documented by means of a Supplementary Agreement between the
Borrower and the Bank.
COMPUTATION
11.6 If there is any dispute as to any computation under this Clause 11
(including any amendment sought pursuant to Clause 11.5) or as to
the interpretation of any of the relevant definitions in Clause
11.2, the
13
decision of the Bank shall, in the absence of manifest error, be
conclusive and binding on the Borrower.
DURATION
11.7 The financial covenants set out in this Clause 11 shall remain in
force until the Loan has been repaid in full.
12 SECURITY
12.1 The obligations of the Borrower to the Bank under this Agreement
shall be secured by:-
(a) all existing security, if any, held by the Bank for the
Borrower's liabilities;
(b) security in the Bank's preferred form as follows:-
(i) a Debenture creating fixed and floating
charges over the Borrower's whole property and
assets;
(ii) an Unlimited Inter-company Guarantee among the
Borrower, Corgi Classics, Inc., Lledo and Icon
supported by:-
(first) a Security Agreement by Corgi
Classics, Inc. creating fixed and
floating charges over its whole
property and assets;
(second) a Debenture by Lledo creating fixed
and floating charges over its whole
property and assets; and
(third) a Debenture by Icon creating fixed
and floating charges over its whole
property and assets;
(iii) a charge in a form satisfactory to the Bank of
sums standing to the credit of all its
accounts at La Salle Bank, 000 Xxxxx Xx Xxxxx
Xxxxxx, Xxxxxxx, Xxxxxxxx in the name of Corgi
Classics, Inc.;
(iv) a Letter of Non-reactivation in a form
satisfactory to the Bank in relation to Corgi
Sales Limited, Company Number 3057179, Corgi
Toys Limited, Company Number 3057178, Xxxxxxx
Lowke Limited, Company Number 3228564,
Xxxxxxx-Xxxxx (Railways) Limited, Company
Number 3240766, Blow-ko Limited, Company
Number 3228159, Zindart (Bermuda) and IIH; and
(c) all future security which the Bank may from time to time
hold for the Borrower's liabilities.
12.2 The Bank reserves the right to exercise at any time and from time
to time hereafter at its discretion to require the Borrower or any
Group company to enter into or procure the entering into of such
additional or replacement security acceptable to the Bank as the
Bank may specify.
12.3 For the avoidance of doubt the Borrower acknowledges that all
security held and to be held by the Bank shall unless the security
document expressly states otherwise secure all the liabilities of
the Borrower to the Bank of whatsoever nature.
13 EVENTS OF DEFAULT
13.1 In the event that:-
NON PAYMENT
(a) the Borrower fails to pay on the due date any amount
payable under this Agreement (other than where the
Borrower demonstrates to the satisfaction of the Bank
that such failure is due to an administrative or
technical payment error, in which case the Borrower shall
have 3 Business Days from the due date to make such
payment); or
MISREPRESENTATION
(b) any representation or warranty made or repeated by the
Borrower in this Agreement is or proves to have been
incorrect in any material respect when made or repeated;
or
14
BREACH OF OTHER OBLIGATIONS
(c) the Borrower fails to comply with any provision of this
Agreement or the Borrower or any other grantor of
security fails to comply with any provision of the
security provided pursuant to Clause 12 and, where
capable of remedy, such failure is not remedied to the
reasonable satisfaction of the Bank within 10 Business
Days of the Bank giving notice to the Borrower or other
grantor requiring the Borrower or other grantor to remedy
the same; or
CROSS DEFAULT
(d) the Borrower or any of its Subsidiaries defaults in the
performance of any other agreement for borrowed monies so
as to accelerate the due date of repayment thereunder or
such borrowed monies are not repaid in full on the due
date or repayment of any such borrowed monies is due on
demand and is not paid in full forthwith on such demand
being made provided that, in the absence of any other
Event of Default, this provision shall not apply to
demand being made in respect of on demand facilities
being made available by the Bank to the Borrower from
time to time; or
INSOLVENCY AND ANALOGOUS PROCEEDINGS
(e) the Borrower or any of its Subsidiaries is unable to pay
its debts within the meaning of Section 123 of the
Insolvency Xxx 0000 or the Borrower or any of its
Subsidiaries otherwise becomes insolvent or suspends
making payments to all or any class of its creditors or
announces an intention to do so; or
(f) any distress, diligence, execution, attachment or other
legal process affects the whole or a material part of the
assets of the Borrower or any of its Subsidiaries and is
not discharged within 21 days; or
(g) an administrative or other receiver or similar officer is
appointed of the whole or any part of the assets of the
Borrower or any of its Subsidiaries or the Borrower or
any of its Subsidiaries requests any person to appoint
such a receiver or similar officer or any other steps are
taken to enforce any charge or other security over any of
the property of the Borrower or any of its Subsidiaries;
or
(h) any order is made or any effective resolution is passed
or a petition (other than a petition which is frivolous
or vexatious or which is withdrawn within 21 days of
presentation for advertisement provided the Bank has been
notified of such petition prior to its advertisement) is
presented or other steps are taken for:-
(i) the winding up, dissolution or liquidation of
the Borrower or any of its Subsidiaries other
than for the purpose of a reconstruction or
amalgamation the terms of which have
previously been approved by the Bank in
writing; or
(ii) the making of an administration order against
the Borrower or any of its Subsidiaries; or
(i) any steps are taken by another creditor to repossess any
goods in the possession of the Borrower or any of its
Subsidiaries under any hire purchase, conditional sale,
leasing, retention of title or similar agreement in
relation to an undischarged debt in excess of
GBP50,000; or
CONTROL
(j) control of the Borrower passes without the consent of the
Bank to any person, firm or company acting either
individually or in concert or control of any of its
Subsidiaries passes without the consent of the Bank to
any party outside the Group; or
US BANK ACCOUNT
(k) any steps are taken by another creditor which affect the
Bank's security over Corgi Classics, Inc.'s bank account
at La Salle Bank; or
MATERIAL ADVERSE CHANGE
(k) any event occurs which in the reasonable opinion of the
Bank is likely to have a material adverse effect on the
ability of the Borrower to comply with its obligations
under this Agreement; or
OTHER JURISDICTIONS
(l) any event occurs which, under the applicable law of any
relevant jurisdiction, has an analogous
15
or equivalent effect to any of the events detailed in
this Clause 13.1
then in any such case and at any time thereafter while such event
is continuing the Bank may by written notice to the Borrower
declare the Loan, all interest accrued and all other sums payable
by the Borrower under this Agreement including the additional
payment detailed in Clauses 6.2 and 6.3 to be immediately due and
payable and/or terminate the obligations of the Bank under this
Agreement.
13.2 Without prejudice to the Bank's rights and remedies upon the
occurrence of an Event of Default as detailed in Clause 13.1, in
the event of a breach of the financial covenant detailed in Clause
11.1(c), the Bank may, at its sole discretion, agree to waive the
default in which case, interest will be charged at the Margin over
LIBOR/the Bank's Base rate applicable at the relevant time.
14 FEES AND EXPENSES
14.1 The Borrower shall meet all costs, charges and expenses reasonably
incurred (including the fees and expenses of any legal advisers
whether directly employed by the Bank or who provide other services
to the Bank) in connection with:-
(a) the preparation and execution of this Agreement; and
(b) the constitution and discharge of the security detailed
in Clause 12 and any further security granted in favour
of the Bank pursuant to Clause 12.
14.2 The Borrower shall meet all costs, charges and expenses incurred
(including the fees and expenses of any legal advisers whether
directly employed by the Bank or who provide other services to the
Bank) in connection with:-
(a) the occurrence of any Event of Default;
(b) the enforcement or preservation of the Bank's rights
under this Agreement and any security held by the Bank in
terms of Clause 12; and
(c) any breach of any environmental law or regulation by the
Borrower or its Subsidiaries.
14.3 The Borrower shall pay to the Bank an arrangement fee of
GBP40,000 on the date which is the earlier of (i) the date on
which the Loan is drawn and (ii) the date which is 5 Business Days
after this Agreement is signed on behalf of the Borrower.
14.4 The Borrower authorises the Bank to debit any unpaid fees and
expenses to a current account maintained by the Borrower with the
Bank.
15 NOTICES
15.1 Every notice or other communication made under this Agreement shall
unless otherwise stated be in writing (by way of letter, telex or
facsimile transmission) and shall be given:-
(a) in the case of the Borrower to its registered office
marked for the attention of "The Company Secretary";
(b) in the case of the Bank to the Corporate Office.
15.2 Every notice or other communication shall be deemed to have been
received:-
(a) in the case of a letter when delivered personally or two
days after its posting by first class post;
(b) in the case of a telex or facsimile transmission when
despatched.
16 MISCELLANEOUS
16.1 The Borrower may not assign or transfer any of its rights or
obligations under this Agreement.
16.2 The Bank may assign all or any part of its rights or benefits under
this Agreement to a Qualifying Bank
16
without the consent of the Borrower provided that following any
such assignment the Borrower will have no greater obligation to the
assignee than it had to the Bank under the terms of this Agreement
prior to such assignment and the Borrower will not be liable for
any costs and expenses incurred in relation to any such assignment.
The Bank may disclose to a prospective assignee or to any other
person who may propose entering into contractual relations with the
Bank in relation to this Agreement such information about the
Borrower as the Bank shall consider appropriate.
16.3 No delay or omission on the part of the Bank in exercising any of
its rights powers or privileges under this Agreement shall operate
as a waiver thereof nor shall any single or partial exercise of any
right power or privilege preclude any other or further exercise
thereof or the exercise of any other right power or privilege.
16.4 This Agreement supersedes all prior agreements, arrangements or
correspondence between the Bank and the Borrower in relation to the
Loan.
16.5 To the extent that there is any conflict between the terms of this
Agreement and the security referred to in Clause 12, the provisions
of this Agreement shall prevail.
17 LAW
17.1 This Agreement shall be governed by and construed in accordance
with the laws of England.
IN WITNESS whereof this Agreement is executed by the duly authorised
representatives of the Bank and the Borrower.
For and on behalf of the Bank
Signature /s/ XXXX XXXXX
......................
Date January 24, 2001
...........................
For and on behalf of the Borrower
Signature /s/ XXX XXXXXX
......................
Date January 24, 2001
...........................
17
SCHEDULE 1
The cost to the Bank referred to in Clause 4.3(a) will be calculated in
accordance with the following formula:-
XL + S(L - D) + F x 0.01
------------------------
100 - (X + S)
where on the day(s) of application of the formula:
X - is the percentage of Eligible Liabilities (in excess of any stated
minimum) by reference to which the Bank is required under or
pursuant to the Bank of England Act 1998 to maintain cash ratio
deposits with the Bank of England;
L - is the percentage rate per annum at which sterling deposits for the
relevant period are offered to the Bank by leading banks in the
London Inter-Bank Market at or about 11.00 a.m. on that day;
F- is the rate of charge payable by the Bank to the Financial Services
Authority pursuant to paragraph 2 of the Fees Regulations (but where
for this purpose, the figure at paragraph 2.02b/2.03b shall be deemed
to be zero) and expressed in pounds per GBP1 million of the Fee
Base of the Bank;
S - is the level of interest-bearing Special Deposits, expressed as a
percentage of Eligible Liabilities, which the Bank is required to
maintain by the Bank of England (or other United Kingdom governmental
authorities or agencies); and
D - is the percentage rate per annum payable by the Bank of England to
the Bank on Special Deposits
X, L, S and D are to be expressed in the formula as numbers and not as
percentages. A negative result obtained from subtracting D from L shall be given
the value of zero.
Each calculation will be rounded up to the next one sixty-fourth of one per
cent.
For the purposes of this Schedule:-
ELIGIBLE LIABILITIES and SPECIAL DEPOSITS shall bear the meanings ascribed to
them under or pursuant to the Bank of Xxxxxxx Xxx 0000 or by the Bank of England
(as may be appropriate), on the day of the application of the formula.
FEE BASE has the meaning ascribed to it for the purposes of, and shall be
calculated in accordance with, the Fees Regulations.
FEES REGULATIONS means, as appropriate, either the Banking Supervision (Fees)
Regulations 1998 or such regulations as from time to time may be in force,
relating to the payment of fees for banking supervision in respect of periods
subsequent to 31 March 1999.
Any reference to a provision of any statute, directive, order or regulation
herein is a reference to that provision as amended or re-enacted from time to
time.
If alternative or additional financial requirements are imposed which in the
Bank's opinion make the formula set out above no longer appropriate, the Bank
shall be entitled to stipulate such other formula as shall be suitable to apply
in substitution for the formula set out above.
18
SCHEDULE 2
CERTIFICATE OF COMPLIANCE
To: The Royal Bank of Scotland plc
Leicestershire Corporate Business Centre
Xx Xxxxx Xxxxx
Xxxx Xxxxxx
Xxxxxxxxx
XX0 0XX
Dear Sirs
CORGI CLASSICS LIMITED -(GBP)4,000,000 TERM LOAN FACILITY AGREEMENT DATED
[ ] 2001 (THE "FACILITY AGREEMENT")
CERTIFICATE OF COMPLIANCE IN RESPECT OF THE FINANCIAL YEAR ENDED [ ]
The calculations of the tests set out in the financial covenants detailed in
Clause 11.1 are attached and the Borrower hereby confirms that the financial
covenants have been complied with on the Compliance Dates referred to in Clause
11.3 of the Facility Agreement.
Yours faithfully
for and on behalf of
CORGI CLASSICS LIMITED
.........................................
Director/Secretary
19
Extract from the Minutes of a Meeting of the Directors of
CORGI CLASSICS LIMITED (the "Company")
"After due consideration of all the circumstances and on being satisfied that it
is for the benefit of the Company and in the interests of the Company for the
purpose of carrying on its business to enter into a loan agreement (the
"Agreement") in the form now produced in respect of a loan of GBP4,000,000
(FOUR MILLION POUNDS STERLING) from The Royal Bank of Scotland plc (the "Bank").
IT WAS RESOLVED THAT * be authorised
to sign on behalf of the Company the Agreement and any documents required by the
Bank in connection with the Agreement."
I HEREBY CERTIFY that the foregoing is a true extract from the Minutes of a
Meeting of the Directors of the Company at which (all appropriate interests
having been declared) a quorum entitled to vote was present duly held on the *
day of and that a true copy of the Agreement has been retained by the Company.
Secretary________________________________________________
* Please complete
