EXHIBIT 4.63
CONFORMED COPY
DATED 19 MAY 2003
Security Interest Agreement
Over Shares
(1) FS FINANCE CORP
(2) THE LAW DEBENTURE TRUST CORPORATION P.L.C. AS SECURITY
TRUSTEE
COLLAS DAY Advocates
X.X. Xxx 000, Xxxxx Xxxxx, Tel: + 00 (0) 0000 000000
Xx Xxxxx Xxxx, Xxxxxxxx XX0 0XX Fax: + 00 (0) 0000 000000
xxx.xxxxxxxxx.xxx E-Mail: xxxxx@xxxxxxxxx.xxx
(Ref SC/jy)
CONTENTS
CLAUSES PAGE
1. Definitions and Interpretation.............................................................. 2
2. Intercreditor Agreement..................................................................... 4
3. Creation of Security Interest in the Securities............................................. 4
4. Dividends and Voting Rights................................................................. 5
5. Continuing Security......................................................................... 5
6. Representations, Warranties and Undertakings by the Debtor.................................. 6
7. Powers of the Trustee upon Enforcement...................................................... 6
8. Restrictions on Charging and Disposal....................................................... 7
9. Power of Attorney........................................................................... 7
10. Preservation of other Security and Rights and Further Assurance............................. 7
11. Notices..................................................................................... 8
12. Expenses, Costs & Taxes..................................................................... 8
13. General..................................................................................... 9
14. Governing Law and Jurisdiction.............................................................. 9
Schedule - The Company and the Securities
THIS AGREEMENT is dated 19 day of May 2003
BETWEEN
(1) FS FINANCE CORP c/o Marconi Communications Inc., 000 Xxxxxx Xxxx - Xxxxx
000, Xxxxxx, XX 00000 Xxxxxx Xxxxxx of America (the "DEBTOR"); and
(2) THE LAW DEBENTURE TRUST CORPORATION P.L.C. (the "TRUSTEE") acting as
Security Trustee, as trustee for itself and for the benefit of the other
Secured Creditors (as defined below).
OPERATIVE PROVISIONS
1. DEFINITIONS AND INTERPRETATION
1.1 In this Agreement unless the context otherwise requires, the following
words and expressions shall have the following meanings:-
ADDRESS FOR SERVICE 0 Xx Xxxxxxxx Xxxxxx, Xx Xxxxx Xxxx,
Xxxxxxxx
COMPANY the company whose details are set out in
Part 1 of the Schedule
CONTINUING in relation to an Enforcement Event, an
acceleration of any Obligation (other than
Obligations arising under the New Bonding
Facility Agreement) where such acceleration
has not been rescinded in writing or a
declaration that the Obligations (other than
Obligations arising under the New Bonding
Facility Agreement) are prematurely due and
payable (other than solely as a result of it
becoming unlawful for a Secured Creditor to
perform its obligations under the Relevant
Documents) where such declaration has not
been revoked in writing or any failure by an
Obligor to pay any principal amount in
respect of any Obligations (other than
Obligations arising under the New Bonding
Facility Agreement) whether on maturity or
otherwise which has not been remedied or
waived in writing
ENFORCEMENT EVENT the acceleration of any Obligations or any
declaration that any Obligations are
prematurely due and payable (other than
solely as a result of it becoming unlawful
for a Secured Creditor to perform its
obligations under the Relevant Documents) or
any failure by any Obligor to pay any
principal amount in respect of any
Obligations whether on maturity or otherwise
INTERCREDITOR AGREEMENT the security trust and intercreditor
agreement dated on or about the Issue Date
between, among others, Marconi Corporation
plc as Issuer and the Trustee as Security
Trustee
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ISSUE DATE the date on which the Notes are issued
LAW the Security Interests (Guernsey) Law, 1993
OBLIGATIONS has the meaning given to the term "Secured
Obligations" in the Intercreditor Agreement
REQUIRED CURRENCY the currency or currencies in which the
Secured Obligations are expressed from time
to time
SECURED CREDITORS the Trustee, any Receiver or Delegate, the
Depositary, the Paying Agent, the Registrar,
the Senior Note Trustee (for itself and as
trustee for the holders of the Senior
Notes), the Junior Note Trustee (for itself
and as trustee for the holders of the Junior
Notes), the Escrow Bank, the New Bonding
Facility Agent and each of the New Bonding
Facility Banks and their successors and
assigns
SECURED OBLIGATIONS all present and future indebtedness,
liabilities and obligations (for the
avoidance of doubt, including any
liabilities and obligations which have been
cash-collateralised by the Obligors) at any
time of the Debtor under the Relevant
Documents, both actual and contingent
whether incurred solely or jointly or in any
other capacity together with any of the
following matters relating to or arising in
respect of those liabilities and
obligations:
(a) any refinancing, novation, deferral
or extension;
(b) any obligation relating to any
increase in the amount of such
obligations;
(c) any claim for damages or restitution;
and
(d) any claim as a result of any recovery
by an Obligor of a payment or discharge,
or non-allowability, on the grounds of
preference,
and any amounts that would be included in
any of the above but for any discharge,
non-provability or unenforceability of those
amounts in any insolvency or other
proceedings (including interest accruing
after the commencement of any insolvency or
other proceedings)
SECURITIES the securities described in Part 2 of the
Schedule
1.2 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.
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1.3 Any discretion or power which may be exercised or any determination which
may be made hereunder by the Trustee may (save as otherwise provided
herein) be exercised or made in its absolute and unfettered discretion.
1.4 References to "this Agreement", "Clause" or a "Schedule" are references to
this Agreement or a clause in or schedule of it.
1.5 References to statutes and/or statutory provisions shall be construed as
referring to such statutes or statutory provisions as respectively
replaced amended extended or consolidated.
1.6 The expression "person" shall be construed to include references to any
person, firm, company, partnership, corporation or any agency thereof.
1.7 Any references herein to any document shall be construed as a reference to
such document as the same may be amended, supplemented, varied,
substituted, novated or assigned.
1.8 Any reference to the Company, the Debtor, the Secured Creditors, the
Trustee or any other party shall include a reference to any successor
company and permitted assigns.
1.9 For the purposes of the Law, the Trustee shall be considered to be the
"secured party", the Debtor shall be considered to be the "debtor" and an
Enforcement Event shall be considered to be an "event of default", unless
otherwise specified in this Agreement.
1.10 Unless otherwise defined in this Agreement, capitalised words appearing in
this Agreement shall have the meanings given to such terms in the
Intercreditor Agreement.
2. INTERCREDITOR AGREEMENT
2.1 Notwithstanding any provision to the contrary contained herein, the
parties agree that this Agreement is subject in all respects to the terms
of the Intercreditor Agreement and for the avoidance of doubt, in the
event of any inconsistency, the provisions of the Intercreditor Agreement
shall prevail, provided that the terms of the Intercreditor Agreement are
not contrary to the Law.
2.2 The parties hereto each acknowledge that the Trustee, when acting
hereunder, shall be acting in accordance with and subject to the terms of
the Intercreditor Agreement.
3. CREATION OF SECURITY INTEREST IN THE SECURITIES
3.1 For the purpose of securing the discharge of the Secured Obligations, the
Debtor:-
3.1.1 assigns and transfers to the Trustee all its interest in the
Securities, all income derived from the Securities and all rights
attaching to the Securities; and
3.1.2 acknowledges and confirms delivery to the Trustee of the
certificates or documents of title to the Securities,
to the intent that a security interest in the Securities in favour of the
Trustee is created pursuant to the Law.
3.2 Subject to Clause 4, the security interest created pursuant to this
Agreement shall include all dividends, income or interest from time to
time paid on the Securities and all rights, moneys or property accruing or
offered at any time by way of redemption, bonus, splitting, preference,
option or otherwise to or in respect of the Securities.
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3.3 The Debtor will at the request of the Trustee execute or procure the
execution of legal transfers of the Securities to the Trustee or otherwise
as the Trustee directs but in the event of any such transfer being
effected the Trustee shall not be liable for any loss occasioned by any
exercise or non-exercise of rights attached to such transferred Securities
or by any failure to forward or report to the Debtor any notice or other
communication received in respect of such transferred Securities.
4. DIVIDENDS AND VOTING RIGHTS
4.1 Prior to the occurrence of an Enforcement Event and at any time when no
Enforcement Event is continuing, the Debtor shall be entitled to:
4.1.1 retain all dividends, interest and other monies arising from the
Securities; and
4.1.2 exercise all voting rights in relation to the Securities provided
that the Debtor shall not exercise such voting rights in any manner
which would constitute a Default or an Event of Default under the
Indentures (as such terms are defined in the Indentures).
4.2 Subject to Clause 7, the Trustee may, upon the occurrence of an
Enforcement Event and at any time thereafter while such Enforcement Event
is continuing, at its discretion (in the name of the Debtor or otherwise
and without any further consent or authority from the Debtor):
4.2.1 exercise (or refrain from exercising) any voting rights in respect
of any of the Securities;
4.2.2 transfer any of the Securities into the name of such nominee(s) of
the Trustee as it shall require; and
4.2.3 exercise (or refrain from exercising) the powers and rights
conferred on or exercisable by the legal or beneficial owner of any
of the Securities, including the right to concur or participate in:
4.2.3.1 the reconstruction, amalgamation, sale or other disposal of
the Company or any of its assets or undertaking (including
the exchange, conversion or reissue of any shares or
securities as a consequence thereof),
4.2.3.2 the release, modification or variation of any rights or
liabilities attaching to the Securities, and
4.2.3.3 the exercise, renunciation or assignment of any right to
subscribe for any shares or securities
in each case in such manner and on such terms as the Trustee may
think fit, and the proceeds of any such action shall form part of
the Securities.
4.3 In this Clause 4, "Enforcement Event" shall have the meaning given to such
term in the Intercreditor Agreement.
5. CONTINUING SECURITY
5.1 The security interest created pursuant to this Agreement shall continue in
full force and effect until released or otherwise terminated in accordance
with this Clause 5.1. The Trustee shall, at the cost of the Debtor,
release and cancel the security constituted by this Agreement and procure
the reassignment to the Debtor of the property and assets assigned to the
Trustee pursuant to this Agreement in accordance with the terms and
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subject to the conditions and circumstances set out in the Intercreditor
Agreement and without recourse to, or any representation or warranty by,
the Trustee or any of its nominees.
5.2 Upon the release or termination of the security interest created pursuant
to this Agreement in accordance with Clause 5.1 the Trustee shall furnish
to the Debtor a duly completed certificate of discharge.
6. REPRESENTATIONS, WARRANTIES AND UNDERTAKINGS BY THE DEBTOR
6.1 The Debtor represents and warrants to the Trustee that it is:
6.1.1 the sole beneficial owner of the Securities; and
6.1.2 the sole legal (except for one Ordinary Share of L1 in the Company
which is registered in the name of Associated Electrical Industries
Holdings Limited ("AEIHL") and held by AEIHL as nominee for the
Debtor) and beneficial owner of all the Securities;
free from any Security (as such term is defined in the Intercreditor
Agreement) except as created by this Agreement.
6.2 The Debtor represents and warrants to the Trustee that the Securities are
fully paid up.
6.3 The Debtor further undertakes to deliver to or to the order of the Trustee
all certificates of title to any shares or other securities in the Company
issued after the date of this Agreement ("New Securities") whether or not
forming part of the Securities, and agrees that to the extent that such
New Securities do not form part of the Securities, the Debtor will, at its
own cost, as soon as practicable, execute a security interest agreement
(in form and substance similar to this Agreement) over the New Securities
in favour of the Trustee.
7. POWERS OF THE TRUSTEE UPON ENFORCEMENT
7.1 At any time after the occurrence of an Enforcement Event, and the Trustee
(acting on instructions received pursuant to the terms of the
Intercreditor Agreement) giving notice to the Issuer thereof and subject
to the giving of notice by the Trustee in accordance with the Law, the
security interest created pursuant to this Agreement shall become
immediately enforceable and the Trustee may in its absolute discretion:-
7.1.1 exercise all its rights and powers under the Law;
7.1.2 pay any calls or other payments due from time to time in respect of
the Securities or payable in respect of any rights attaching to the
Securities;
7.1.3 exercise any rights attaching to the Securities for the purpose of
preserving the value of the Securities;
7.1.4 in addition to any lien or right to which the Trustee may be
entitled by law, without notice set off the whole or any part of the
Secured Obligations against any amount or other obligation
(contingent or otherwise) owing by the Trustee to the Debtor.
7.2 The Trustee may exchange or convert to the Required Currency any currency
held or received.
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7.3 Subject to Clause 7.1, the Securities shall be applied by the Trustee in
the manner set out in the Intercreditor Agreement.
8. RESTRICTIONS ON CHARGING AND DISPOSAL
The Debtor shall not, except as not expressly prohibited under the terms
of the Indentures:-
8.1 create or permit to arise any mortgage, charge, lien or other security
interest on the Securities or any interest in or part of the Securities;
or
8.2 sell or attempt to sell or otherwise dispose of the Securities or any
interest in or part of the Securities.
9. POWER OF ATTORNEY
9.1 The Debtor by way of security irrevocably appoints the Trustee and each
Delegate severally to be its attorney (the "Attorney") and in its name, on
its behalf and as its act and deed to execute, deliver and perfect all
documents and do all things which the Attorney may consider to be required
or desirable for:
9.1.1 carrying out any obligation imposed on the Debtor by this Agreement
(including the execution and delivery of any notices, deeds,
charges, assignments or other security and any transfers of the
Securities); and
9.1.2 enabling the Trustee and each Delegate to exercise, or delegate the
exercise of, any of the rights, powers and authorities conferred on
them by or pursuant to this Agreement or by law (including, after
the occurrence of an Enforcement Event, the exercise of any right of
a legal or beneficial owner of the Securities).
9.2 The Debtor shall ratify and confirm all things done and all documents
executed by any Attorney in the exercise or purported exercise of all or
any of his powers.
9.3 The Debtor shall indemnify the Attorney and keep the Attorney indemnified
against any and all costs, claims, and liabilities which the Attorney may
incur as a result of anything done by the Attorney in the proper exercise
of any of the powers conferred, or purported to be conferred, on him or
her by this Agreement unless such cost, claim or liability arises as a
result of the negligence or wilful misconduct of the Attorney.
10. PRESERVATION OF OTHER SECURITY AND RIGHTS AND FURTHER ASSURANCE
10.1 The security created pursuant to this Agreement is in addition to any
other security present or future held by the Trustee for the Secured
Obligations and shall not merge with or prejudice such other security or
any contractual or legal rights of the Trustee.
10.2 The security created by this Agreement shall not be affected by any other
security held by the Trustee in respect of the Secured Obligations being
void or unenforceable.
10.3 The Debtor shall do all such acts and execute all such documents
(including assignments, transfers, mortgages, charges, notices and
instructions) as the Trustee may specify (and in such form as the Trustee
may require in favour of the Trustee or its nominee(s)):
10.3.1 to perfect the security created or intended to be created in
respect of the Securities or for the exercise of all rights, powers
and remedies of the Trustee provided by or pursuant to this
Agreement or by the Law;
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10.3.2 to confer on the Trustee security over the Securities; and/or
10.3.3 to facilitate the realisation of the Securities.
11. NOTICES
11.1 Any notice or demand by the Trustee may effectually be made by notice in
writing to the Debtor under the hand of any one of the Trustee's officers
served in accordance with Section 13 of the Law.
11.2 Any notice of default required to be given pursuant to Section 7(3) of the
Law shall be deemed to have been received by the Debtor:-
11.2.1 when delivered to the Debtor, or
11.2.2 when left at the Debtor's proper address, or
11.2.3 if posted to the Debtor at the Debtor's proper address on the day
immediately following the posting of such notice notwithstanding
that it be returned undelivered.
11.3 For the purpose of this Agreement the term "proper address" shall mean:-
11.3.1 the address of the Debtor as provided in this Agreement; and/or
11.3.2 such other address as the Debtor shall have notified in writing to
the Trustee in advance; and/or
11.3.3 the Address for Service.
11.4 Subject as otherwise provided in this Agreement, each communication to be
made under this Agreement shall be made and delivered in accordance with
the provisions of the Intercreditor Agreement.
12. EXPENSES, COSTS AND TAXES
12.1 EXPENSES
The Debtor shall, from time to time and promptly on demand by the Trustee
reimburse to the Trustee all costs and expenses (including legal fees) on
a full indemnity basis together with any applicable VAT incurred by the
Trustee and any Delegate (provided that in relation to sub-clause 12.1.1
of this Clause 12, such costs and expenses must be properly incurred) in
connection with:
12.1.1. the execution, release and discharge of this Agreement and the
security created or intended to be created in respect of the
Securities and perfection of the Security contemplated in this
Agreement or in any such documents or forming part of the Security
created or intended to be created in respect of the Securities;
12.1.2. the actual or contemplated exercise, preservation and/or
enforcement of any of the rights, powers and remedies of, or the
performance of the duties and obligations of, the Trustee or any
Delegate, or any amendment or waiver in respect of this Agreement;
12.1.3. the foreclosure of any Securities; and
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12.1.4. the preservation and/or enforcement of the Security created or
intended to be created in respect of the Securities;
which shall carry interest from the date of such demand until so
reimbursed at the rate and on the basis as mentioned in clause
18.4 (Interest on Demands) of the Intercreditor Agreement.
12.2 TAXES
The Debtor shall pay, promptly on demand of the Trustee all stamp,
registration, notarial and other similar Taxes or fees paid or payable by
the Trustee in connection with any action taken or contemplated by or on
behalf of the Trustee for perfecting, enforcing, releasing, cancelling,
reassigning or resolving any doubt concerning, or for any other purpose in
relation to this Agreement, any amendment thereto, any transfer and/or
assignment of the rights and/or obligations under the same or the Security
created or intended to be created in respect of the Securities and shall,
from time to time, indemnify the Trustee promptly on demand against any
liabilities, costs, claims and expenses resulting from any failure to pay
by the Debtor or any delay by the Debtor in paying any such Taxes or fees.
13. GENERAL
13.1 Each of the provisions of this Agreement shall be severable and distinct
from one another and if one or more of such provisions is invalid or
unenforceable the remaining provisions shall not in any way be affected.
13.2 The Trustee may assign and transfer all or any of its rights and
obligations under this Agreement in accordance with the Intercreditor
Agreement. The Trustee shall be entitled to disclose such information
concerning the Debtor and this Agreement as the Trustee considers
appropriate to any actual or proposed direct or indirect successor or to
any person to whom information may be required to be disclosed by any
applicable law.
13.3 This Agreement may be executed in any number of counterparts and by
different parties hereto in separate counterparts, each of which when so
executed shall be deemed to be an original and all of which when so
executed shall constitute one and the same binding agreement between the
parties.
14. GOVERNING LAW AND JURISDICTION
14.1 This Agreement shall be governed by and construed in accordance with the
laws of Guernsey.
14.2 For the benefit of the Trustee the Debtor irrevocably submits to the
jurisdiction of the Guernsey Courts and the Debtor irrevocably agrees that
a judgment in any proceedings in connection with this Agreement by the
Guernsey Courts shall be conclusive and binding upon the Debtor and may be
enforced against the Debtor in the Courts of any other jurisdiction. The
Trustee shall also be entitled to take proceedings in connection with this
Agreement against the Debtor in the Courts of any country in which the
Debtor has assets or in any other Courts of competent jurisdiction.
14.3 The Debtor irrevocably waives:-
14.3.1 any objection which the Debtor may now or in the future have to the
Guernsey Courts or other Courts referred to in Clause 14.2 as a
venue for any proceedings in connection with this Agreement; and
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14.3.2 any claim which the Debtor may now or in the future be able to make
that any proceedings in the Guernsey Courts or other Courts
referred to in Clause 14.2 have been instituted in an inappropriate
forum.
IN WITNESS whereof this Agreement has been duly executed.
XXXXXXXX X XXXXXXX
SIGNED by XXXXXXXX X XXXXXXX
duly authorised signatory
for and on behalf of
FS FINANCE CORP
X X XXXXX
SIGNED by X X XXXXX
duly authorised signatory
for and on behalf of
THE LAW DEBENTURE TRUST CORPORATION P.L.C.
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SCHEDULE
PART 1 - THE COMPANY
Xxxxxx Street Overseas Investments Limited
Registered Number: 33433
Registered Office: 0 Xx Xxxxxxxx Xxxxxx, Xx. Xxxxx Xxxx, Xxxxxxxx
PART 2 - THE SECURITIES
The entire issued share capital of the Company, being
- 1,000 Cumulative Preference Shares of L0.01 each registered in the
name of the Debtor;
- 99 Ordinary Shares of L1 each registered in the name of the Debtor;
- 1 Ordinary Share of L1 registered in the name of Associated
Electrical Industries Holdings Limited
all of which are fully paid up.
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