1
EXECUTION COPY
Exhibit 10.9
================================================================================
Dated 30 May 2000
NTI COMMUNICATIONS CORP.
as Parent
NTL (UK) GROUP, INC.
as Intermediate Parent
NTL COMMUNICATIONS LIMITED
as Borrower
XXXXXX XXXXXXX XXXX XXXXXX BANK LIMITED
AND CHASE MANHATTAN PLC
as Arrangers and Joint Book Managers
and
CHASE MANHATTAN INTERNATIONAL LIMITED
as Agent and Security Trustee
and
OTHERS
--------------------
L1,300,000,000
CREDIT AGREEMENT
--------------------
===============================================================================
WHITE & CASE
0-00 Xxxxxxxx
Xxxxxx XX0X 0XX
2
THIS AGREEMENT is made on 30 May 2000
BETWEEN:
(1) NTL COMMUNICATIONS CORP., a company incorporated in Delaware (the
"PARENT");
(2) NTL (UK) GROUP, INC., a company incorporated in Delaware (the
"INTERMEDIATE PARENT");
(3) NTL COMMUNICATIONS LIMITED, a company incorporated in England and Wales
with company number 3521915 (the "BORROWER");
(4) XXXXXX XXXXXXX XXXX XXXXXX BANK LIMITED AND CHASE MANHATTAN PLC as
arrangers and joint book managers of the Facility (the "ARRANGERS");
(5) CHASE MANHATTAN INTERNATIONAL LIMITED as agent for the Banks (the
"AGENT");
(6) CHASE MANHATTAN INTERNATIONAL LIMITED as security trustee for the
Finance Parties (the "SECURITY Trustee"); and
(7) THE BANKS (as defined below).
IT IS AGREED as follows:
1. DEFINITIONS AND INTERPRETATION
1.1 DEFINITIONS
In this Agreement:
"ACCOUNTANTS' REPORT" means the report prepared by the Target's
accountants, Xxxxxx Xxxxxxxx, dated 14 February 2000 and splitting the
Target's financial statements for its financial years ended 31 March
1997, 31 March 1998 and 31 March 1999 between the CWC ConsumerCo
Business and the CWC DataCo Business (as set out in Part A of Appendix 8
of the CWC Circular).
"ACQUISITION" means the acquisition by NTL Holdings of the issued share
capital of CWC Holdings pursuant to the Transaction Agreement.
"ACQUISITION DATE" means the date on which the Acquisition is completed,
being a date on or prior to 31 March 2001.
"ADDITIONAL INCREMENTAL AMOUNT" means the next L500,000,000 of Financial
Indebtedness incurred pursuant to clause (i) of the definition of
Permitted Indebtedness after the Incremental Amount.
"ADVANCE" means an advance (as from time to time consolidated, divided
or reduced by repayment in accordance with the terms hereof) made or to
be made by the Banks under the Facility.
1
3
"ASSET ADJUSTMENT PAYMENTS" means:
(a) a payment made by a member of the Target Group to a company
carrying on the CWC DataCo Business, in respect of a transfer of
assets from that company carrying on the CWC DataCo Business to
such a member of the Target Group; or
(b) a payment made by a company carrying on the CWC DataCo Business
to a member of the Target Group, in respect of a transfer of
assets from such a member of the Target Group to that company
carrying on the CWC DataCo Business,
in each case in accordance with the terms of the Transaction Agreement
and where either Cable & Wireless is obliged to reimburse NTL Holdings
in respect of a payment made by a member of the Target Group under
paragraph (a) or NTL Holdings is obliged to reimburse Cable & Wireless
in respect of a payment received by a member of the Target Group
pursuant to paragraph (b).
"ASSET PASSTHROUGH" means a series of transactions, commencing with a
transaction between the Parent and a member of the Covenant Group, which
may be followed by one or more similar transactions between various
members of the Covenant Group and culminating with a similar transaction
between a member of the Covenant Group and a Final Asset Transferee, the
purpose of which is to enable the Parent to indirectly transfer assets
to that Final Asset Transferee by way of transfers of those assets to
and from (and, if necessary, between) one or more members of the
Covenant Group in such a matter as to be neutral to the Covenant Group
taken as a whole, PROVIDED THAT:
(a) the consideration payable (if any) by the first member of the
Covenant Group to acquire such assets to the Parent comprises
either (i) cash funded or to be funded directly or indirectly by
a payment from the Final Asset Transferee in connection with
that series of transactions or (ii) Subordinated Funding;
(b) if the Intermediate Parent (having acquired such assets from the
Parent) transfers them on to another member of the Covenant
Group, the consideration payable by such a member of the
Covenant Group comprises either (i) cash funded or to be funded
directly or indirectly by a payment from the Final Asset
Transferee in connection with that series of transactions or
(ii) Parent Funding;
(c) the consideration payable by the Final Asset Transferee is equal
to the consideration received or receivable by the Parent;
(d) the consideration payable by each member of the Covenant Group
participating in such a series of transactions is equal in
value;
(e) all of the transactions comprising such a series of transactions
(from and including the transfer of the assets by the Parent to
and including the acquisition of those assets by the Final Asset
Transferor) are completed within two Business Days; and
(f) upon completion of all of the transactions comprising such a
series of transactions, no person (other than another member of
the Covenant Group) has any recourse to any member of the
Covenant Group in relation to such a series
2
4
of transactions (other than in respect of (i) the Subordinated
Funding mentioned in paragraph (a) above) and (ii) covenants as
to title provided in favour of the Final Asset Transferee on the
same terms as such covenants were provided in favour of the
Initial Asset Transferor in respect of the relevant assets.
"ASSIGNED DEBT" means any loan made by the Parent to the Intermediate
Parent or by the Intermediate Parent to the Borrower where the lender's
rights in respect of any such loan have been assigned to the Security
Trustee pursuant to the Inter-Company Loan Assignment.
"AUTHORISED SIGNATORY" means, in relation to an Obligor, any person who
is duly authorised (in such manner as may be reasonably acceptable to
the Agent) and in respect of whom the Agent has received a certificate
signed by a director or another Authorised Signatory of such Obligor
setting out the name and signature of such person and confirming such
person's authority to act.
"AVAILABLE COMMITMENT" means, in relation to a Bank at any time and save
as otherwise provided herein, its Commitment at such time LESS the
aggregate amount which it has advanced hereunder at such time (but not
including any amount added to the Advances pursuant to Clause 4.3
(Limitations on Cash Interest)), PROVIDED THAT such amount shall not be
less than zero.
"AVAILABLE EXCESS CASH FLOW" means, at any time, the aggregate Excess
Cash Flow generated in respect of each financial year of the Borrower,
commencing with the financial year ended 31 December 2003, less the
amount of such Excess Cash Flow (in respect of each such financial year)
which:
(a) is required to be used (in respect to such financial year) to
prepay the Senior Bank Loan in accordance with clause 10.1 of
the Senior Bank Credit Agreement or the Loan in accordance with
Clause 9.1 (Mandatory Prepayment from Excess Cash Flow) of this
Agreement; and
(b) has, on or after 1 January 2003, already been used to fund a
Permitted Payment.
"AVAILABLE FACILITY" means, at any time, the aggregate amount of the
Available Commitments adjusted, in the case of any proposed drawdown, so
as to take into account any reduction in the Available Commitment of a
Bank pursuant to the terms hereof.
"AVERAGE REVENUE CONTRIBUTIONS" means, in respect of any asset at any
time:
A + B
-------
2
where:
A = the revenue generated by, or attributable (whether
in whole or in part) to, such asset during the
immediately preceding financial year of the Borrower,
expressed as a percentage of the aggregate of the
consolidated revenue of the UK Group and, prior to
the Pushdown Date, the consolidated revenue of the
Target Group for such a financial year; and
3
5
B = the revenue generated by, or attributable (whether
in whole or in part) to, such asset during the
financial year of the Borrower preceding that
referred to in A above, expressed as a percentage of
the aggregate of the consolidated revenue of the UK
Group and, prior to the Pushdown Date, the
consolidated revenue of the Target Group for such
financial year.
"BANK" means any financial institution:
(a) named in Schedule 1 (The Banks); or
(b) which has become a party hereto as a Bank in accordance with
Clause 30.4 (Assignments by Banks) or Clause 30.5 (Transfers by
Banks),
and which has not ceased to be a party hereto in accordance with the
terms hereof.
"BUDGET" means a budget delivered by the Borrower to the Agent pursuant
to Clause 16.5 (Budgets).
"BUSINESS DAY" means a day (other than a Saturday or Sunday) which is
not a public holiday and on which banks are open for general business in
both London and New York.
"BUSINESS PLAN" means the financial model including profit and loss
accounts, balance sheets and cashflow projections, in the agreed form,
relating to the UK Group (for these purposes assuming that the Pushdown
has been completed) as set out in annex 16 to the Information
Memorandum.
"C&W (UK) HOLDINGS" means Cable & Wireless (UK) Holdings plc, a company
incorporated in England and Wales (company number 3888319), being (on
and after the Scheme Effective Date) a wholly owned subsidiary of Cable
& Wireless.
"CABLE & WIRELESS" means Cable & Wireless plc, a company incorporated in
England and Wales (company number 238525).
"CABLE BUSINESS" means (i) any person directly or indirectly operating,
or owning a license to operate, a cable and/or television and/or
telephone and/or telecommunications system or service principally within
the United Kingdom and/or in Ireland and (ii) any Cable Related
Business.
"CABLE RELATED BUSINESS" means a person which directly, or indirectly,
owns or provides a service or product used in a Cable Business,
including, without limitation, any television programming, production
and/or licensing business or any programming guide or telephone
directory business or content or software related thereto.
"CAPITAL EXPENDITURE" means expenditure on the acquisition or
improvement of an asset which would be treated as a capital asset in
accordance with generally accepted accounting principles in the United
Kingdom.
"CAPITAL EVENT PROCEEDS" means the net cash proceeds received by any
member of the Group from the issuance or sale of Financial Indebtedness
or equity interests to persons which are not members of the Group other
than:
4
6
(a) Financial Indebtedness under the Senior Bank Credit Agreement
(other than the Incremental Amount);
(b) Financial Indebtedness constituting the Additional Incremental
Amount;
(c) Financial Indebtedness incurred or equity proceeds raised by the
Group's Australian companies to the extent that the net cash
proceeds thereof do not exceed L250,000,000;
(d) Financial Indebtedness used for the Group's working capital,
capital expenditure and other general corporate purposes, in
each case incurred in the ordinary course of business to the
extent that the aggregate principal amount of such Financial
Indebtedness does not exceed L50,000,000 at any one time
outstanding;
(e) Financial Indebtedness incurred for working capital purposes
pursuant to commitments existing on the Execution Date;
(f) Non-Recourse Bank Indebtedness incurred by a Non-Recourse
Subsidiary;
(g) Net cash proceeds received from the issuance of equity interests
(including, without limitation, warrants and options) to
officers, directors and employees pursuant to stock option or
other incentive plans, to the extent that the aggregate amount
of such net cash proceeds received after the Execution Date does
not exceed L50,000,000;
(h) amounts equal to Debt Adjustment Payments from time to time
invested as contemplated in Clause 19.15 (Debt Adjustment
Payments); and
(i) any net cash proceeds received on conversion and/or cancellation
and reissue of securities.
"CAPITAL EVENT PROCEEDS AMOUNT" means at any time of the receipt by the
Group of Capital Event Proceeds (x) the aggregate amount of Capital
Event Proceeds (including the Capital Event Proceeds then being
received) received after the Execution Date multiplied by the
applicable Required Percentage less (y) the amount of such Capital
Event Proceeds which have been applied in accordance with Clause 9.6
(Application of Proceeds), provided (i) any product of such calculation
which is negative shall be treated as zero and (ii) the Capital Event
Proceeds Amount for any Capital Event Proceeds received during a Remedy
Restriction Period shall be an amount equal to 100% of such Capital
Event Proceeds.
For the avoidance of doubt, the net cash proceeds of the Incremental
Amount shall constitute Capital Event Proceeds.
"CAXTON" means Caxton Holdings Limited, a company incorporated in
England and Wales (company number 3840888), being (prior to the First
Caxton Sale) a wholly owned subsidiary of the Target and, together with
its subsidiaries, comprising the CWC DataCo Business.
"CHARGED ACCOUNT" means an account, bearing interest at a commercially
reasonable rate in relation to the given circumstances, in the name of
any member of the NTL
5
7
Holding Group over which security has been granted in favour of the
Finance Parties (or the Security Trustee on their behalf) on terms
acceptable to the Agent (or if the Senior Bank Credit Agreement is in
effect, in favour of the banks under the Senior Bank Credit Facility (or
a security trustee on their behalf)), into which members of the UK Group
make deposits for the purpose of making Permitted Payments in accordance
with paragraph (e) of the definition thereof.
"CODE" means the City Code on Takeovers and Mergers.
"COMMITMENT" means, in relation to a Bank at any time and save as
otherwise provided herein, the amount set opposite its name under the
heading "COMMITMENT" in Schedule 1 (The Banks). The Commitments of
Xxxxxx Xxxxxxx Xxxx Xxxxxx Bank Limited and Xxxxxx Xxxxxxx Senior
Funding, Inc. shall be determined in accordance with Clause 30.11
(Xxxxxx Xxxxxxx Commitment).
"COMPLIANCE CERTIFICATE" means a certificate substantially in the form
set out in Schedule 6 (Form of Compliance Certificate).
"CONFIDENTIALITY UNDERTAKING" means a confidentiality undertaking in the
standard form from time to time of the LMA or in such other form as may
be agreed between the Borrower and the Agent.
"COURT" means the High Court of Justice of England and Wales.
"COURT MEETING" means the meeting of the holders of the shares of Target
summoned by the Court and directed to consider and vote on whether to
approve the Scheme pursuant to Section 425.
"COVENANT GROUP" means the Intermediate Parent, any subsidiary of the
Intermediate Parent which is a direct or indirect holding company of the
Borrower, the Borrower and the other members of the UK Group. For the
avoidance of doubt, the Parent is not a member of the Covenant Group.
"COVENANT GROUP OBLIGOR" means each member of the Covenant Group which
is an Obligor.
"CWC CIRCULAR" means the circular to the Target's shareholders dated 14
February 2000 (as supplemented by a circular dated 3 March 2000),
relating to the Scheme and the proposed acquisition of the CWC DataCo
Business by Cable & Wireless and the CWC ConsumerCo Business by NTL
Holdings.
"CWC CONSUMERCO BUSINESS" means the residential cable, business cable,
indirect residential telephony, residential internet and digital
television development and services businesses owned and operated by the
Target and its subsidiaries.
"CWC DATACO BUSINESS" means the corporate, business, internet protocol
and wholesale operations carried on by the Target and its subsidiaries
prior to the First Caxton Sale.
"CWC HOLDINGS" means Cable & Wireless Communications (Holdings) plc, a
company incorporated in England and Wales with company number 3922682.
6
8
"CWC HOLDINGS CAPITAL REDUCTION" means the reduction in the share
capital of CWC Holdings occurring prior to the Acquisition, such a
reduction being confirmed by the Court in accordance with section 135 of
the Companies Xxx 0000.
"DEBT ADJUSTMENT PAYMENTS means:
(a) in the event that the members of the Target Group are found to
have had excessive indebtedness as at the Acquisition Date, the
issue and/or transfer of Cable & Wireless shares to NTL
Holdings; or
(b) in the event that the members of the Target Group are found to
have had insufficient indebtedness as at the Acquisition Date,
the payment of a sum equal to such an insufficient amount of
indebtedness by NTL Holdings to Cable & Wireless.
"DIAMOND NOTES" means the:
(a) 13-1/4% senior discount notes due 30 September, 2004, with a
principal amount at maturity of $285,000,000, issued by Diamond
Cable Communications plc;
(b) 11-3/4% senior discount notes due 15 December, 2005, with a
principal amount at maturity of $531,000,000, issued by Diamond
Cable Communications plc;
(c) 10-3/4% senior discount notes due 15 February, 2007, with a
principal amount at maturity of $421,000,000, issued by Diamond
Cable Communications plc;
(d) 10% senior notes due 1 February, 2008, with a principal amount
at maturity of L135,000,000, issued by Diamond Holdings plc; and
(e) 9-1/8% senior notes due 1 February, 2008, with a principal
amount at maturity of $110,000,000, issued by Diamond Holdings
plc.
"DISCLOSURE LETTER" means the letter, in the agreed form, dated on or
about the Execution Date from the Borrower to the Agent (on behalf of
the Finance Parties) setting out various matters to be excluded from
certain representations and covenants in this Agreement.
"DISPUTE" means any dispute referred to in Clause 39 (Jurisdiction).
"DORMANT SUBSIDIARY" means, at any time, any subsidiary of the Borrower
which is "dormant" as defined in Section 250(3) of the Companies Xxx
0000.
"EBITDA" has the meaning given to it in Clause 17.2 (Financial
Definitions).
"EGM" means the extraordinary general meeting of Target convened to
consider and vote on the resolutions necessary to implement the Scheme.
"EMU" means Economic and Monetary Union as contemplated in the Treaty on
European Union.
"EMU LEGISLATION" means legislative measures of the European Union for
the introduction of, changeover to or operation of the euro in one or
more member states, being in part legislative measures to implement the
third stage of EMU.
7
9
"ENCUMBRANCE" means (a) a mortgage, charge, pledge, lien or other
encumbrance securing any obligation of any person, (b) any arrangement
under which money or claims to, or the benefit of, a bank or other
account may be applied, set off or made subject to a combination of
accounts so as to effect discharge of any sum owed or payable to any
person or (c) any other type of preferential arrangement (including any
title transfer and retention arrangement) having a similar effect.
"ENVIRONMENTAL CLAIM" means any claim, proceeding or investigation by
any person pursuant to any Environmental Law.
"ENVIRONMENTAL LAW" means any applicable law in any jurisdiction in
which any member of the Covenant Group conducts business which relates
to the pollution or protection of the environment or harm to or the
protection of human health or the health of animals or plants.
"ENVIRONMENTAL PERMITS" means any permit, licence, consent, approval and
other authorisation and the filing of any notification, report or
assessment required under any Environmental Law for the operation of the
business of any member of the Covenant Group conducted on or from the
properties owned or used by the relevant member of the Covenant Group.
"EVENT OF DEFAULT" means any circumstance described as such in Clause 19
(Events of Default).
"EXCESS CAPACITY NETWORK SERVICES" means the provision of network
services, or agreement to provide network services, by a member of the
UK Group in favour of one or more of its affiliates where such network
services are only provided in respect of the capacity available to such
a member of the UK Group in excess of that network capacity it requires
to continue to provide current services to its existing and projected
future customers and to allow it to provide further services to both its
existing and projected future customers in accordance with the Business
Plan.
"EXCESS CASH FLOW" has the meaning given to it in Clause 17.2 (Financial
Definitions).
"EXCESS CASH FLOW PAYMENT AMOUNT" means for any financial year an amount
equal to (x) 50 per cent. of Excess Cash Flow for such financial year
less (y) the permanent reductions to the advances and loans under the
Senior Bank Credit Agreement required to be made from such Excess Cash
Flow for such financial year pursuant to clause 10.1 of the Senior Bank
Credit Agreement.
"EXECUTION DATE" means the date of this Agreement.
"EXISTING PERFORMANCE BONDS" means:
(a) performance bonds in an aggregate amount of up to L7,100,000
issued by Zurich Re at the request of certain members of the
Target Group;
(b) performance bonds in an aggregate amount of up to L1,139,199
issued by National Westminster Bank Plc at the request of
certain members of the Target Group; and
8
10
(c) performance bonds in an aggregate amount of up to L2,800,000
issued by National Westminster Bank Plc at the request of
certain members of the UK Group.
"FACILITY" means the L1,300,000,000 multiple draw loan facility granted
to the Borrower in this Agreement.
"FACILITY OFFICE" means, in relation to the Agent, the office identified
with its signature below or such other office as it may select by notice
and, in relation to any Bank, the office notified by it to the Agent in
writing prior to the date hereof (or, in the case of a Transferee, at
the end of the Transfer Certificate to which it is a party as
Transferee) or such other office as it may from time to time select by
notice to the Agent.
"FINAL ASSET TRANSFEREE" means the member of the Group, other than a
member of the Covenant Group, who is the final transferee in respect of
a transfer from the Parent, through one or more members of the Covenant
Group.
"FINAL MATURITY DATE" means 31 March 2006.
"FINANCE DOCUMENTS" means this Agreement, the fee letters referred to in
Clause 21.4 (Agency and other Fees), the Security Documents, the
Security Trust Agreement, any Guarantor Accession Memorandum, the Parent
Subordination Agreement, the Intermediate Parent Subordination
Agreement, the Intercreditor Agreement and any other document designated
as such by the Agent and the Borrower.
"FINANCE PARTIES" means, at any time, the Agent, the Arrangers, the
Security Trustee and the Banks at such time.
"FINANCIAL INDEBTEDNESS" means any indebtedness for or in respect of:
(a) Indebtedness for Borrowed Money;
(b) any documentary or standby letter of credit facility or
performance bond facility;
(c) any Hedging Agreement (and the amount of the Financial
Indebtedness in relation thereto shall be calculated by
reference to the xxxx-to-market valuation of such transaction at
the relevant time); and
(d) (without double counting) any guarantee or indemnity for any of
the items referred to in paragraphs (a) to (c) above.
"FINANCIAL QUARTER" has the meaning given to it in Clause 17.2
(Financial Definitions).
"FIRST CAXTON SALE" means the transfer, after the Scheme Effective Date,
of Caxton by the Target to CWC Holdings, as authorised by the Scheme,
such a transfer being made at book value (subject to adjustment under
Schedule 19 of the Transaction Agreement), on terms that the price
payable by CWC Holdings is left outstanding to the extent that CWC
Holdings does not assume at least a corresponding amount of indebtedness
of the Target in consideration for the sale of Caxton.
"FULL FUNDING DATE" has the meaning given to it in the Intercreditor
Agreement as in effect on the Execution Date.
9
11
"FUNDED EXCLUDED SUBSIDIARY" means a UK Group Excluded Subsidiary which:
(a) indirectly receives funding from the Parent; and/or
(b) by way of dividend or other distribution, loan or payment of
interest on or the repayment of the principal amount of any
indebtedness owed by it, makes a payment to the Parent,
in each case by way of a Funding Passthrough.
"FUNDING PASSTHROUGH" means a series of transactions between the Parent,
one or more members of the Covenant Group and a Funded Excluded
Subsidiary where:
(a) in the case of funding being provided by the Parent to the
Funded Excluded Subsidiary, that funding is:
(i) first made available by the Parent to the Intermediate
Parent by way of Subordinated Funding;
(ii) secondly made available by the Intermediate Parent to
the Borrower by way of Parent Funding; and
(iii) thirdly (if relevant) made available by one or more
transactions between members of the UK Group and finally
made available by a member of the UK Group to the Funded
Excluded Subsidiary in all such cases by way of either
the subscription for new equity capital, the advancing
of loans or capital contribution; or
(b) in the case of a payment to be made by the Funded Excluded
Subsidiary to the Parent, that payment is:
(i) first made by the Funded Excluded Subsidiary to a member
of the UK Group, and thereafter between members of the
UK Group (as relevant), by way of dividend or other
distribution, loan or payment of interest on or the
repayment of the principal amount of any indebtedness
owed by such Funded Excluded Subsidiary or relevant UK
Group; and
(ii) finally made by a member of the UK Group to the Parent
by way of dividend or other distribution, loan or the
payment of interest on or the repayment of the principal
amount of any Subordinated Debt owed to the Parent by
the Intermediate Parent.
"GROUP" means NTL Holdings and its subsidiaries.
"GROUP STRUCTURE CHARTS" means:
(a) the structure chart showing (at least) the UK Group and the NTL
Holding Group, in the agreed form; and
(b) the structure chart showing the Target Group (in a form similar
to the structure chart referred to in paragraph (a) above).
10
12
"GUARANTOR" means the Parent, the Intermediate Parent and any other
person who becomes a guarantor pursuant to Clause 37.
"GUARANTOR ACCESSION MEMORANDUM" means a memorandum substantially in the
form set out in Schedule 10.
"HEDGING AGREEMENT" means an agreement in respect of an interest rate
swap, currency swap, forward foreign exchange transaction, cap, floor,
collar or option transaction or any other treasury transaction or any
combination thereof or any other transaction entered into in connection
with protection against or benefit from fluctuation in any rate or
price.
"HEDGING STRATEGY" means the hedging strategy adopted by the Borrower
from time to time for the sole purpose of hedging the UK Group's
then existing interest rate or currency risk exposure in connection with
its ordinary business acting reasonably and prudently and not for
speculative or proprietary trading purposes.
"ICTA" means the Income and Corporation Taxes Xxx 0000.
"INCREMENTAL AMOUNT" means the first L500,000,000 of Financial
Indebtedness incurred pursuant to clause (i) of the definition of
Permitted Indebtedness.
"INDEBTEDNESS FOR BORROWED MONEY" means any indebtedness for or in
respect of:
(a) moneys borrowed;
(b) any amount raised by acceptance under any acceptance credit
facility;
(c) any amount raised pursuant to any note purchase facility or the
issue of bonds, notes, debentures, loan stock or any similar
instrument (for the avoidance of doubt excluding any such
instrument issued solely by way of consideration for the
acquisition of assets where such an instrument is not issued for
the purpose of raising finance);
(d) any amount raised pursuant to any issue of shares which are
expressed to be redeemable in cash (other than (i) shares
redeemable after 31 March 2007 and (ii) redeemable shares issued
by way of consideration for the acquisition of assets where such
shares are not issued for the purpose of raising finance);
(e) the amount of any liability in respect of any lease or hire
purchase contract which would, in accordance with generally
accepted accounting principles in the relevant jurisdiction, be
treated as a finance or capital lease;
(f) the amount of any liability in respect of any advance or
deferred purchase agreement if the primary reason for entering
into such agreement is to raise finance;
(g) receivables sold or discounted (other than on a non-recourse
basis);
(h) any agreement or option to re-acquire an asset if the primary
reason for entering into such agreement or option is to raise
finance;
11
13
(i) any amount raised under any other transaction (including any
forward sale or purchase agreement) having the commercial effect
of a borrowing; and
(j) (without double counting) the amount of any liability in respect
of any guarantee or indemnity for any of the items referred to
in paragraphs (a) to (i) above.
"INFORMATION MEMORANDUM" means the document concerning the CWC
ConsumerCo Business and the UK Group and the Target Group which, at,
inter alia, the Borrower's request and on its behalf, was prepared in
relation to the Senior Bank Credit Agreement and distributed by the
Arrangers to selected banks during May 2000 (as the same may be updated
on or before the Syndication Date).
"INTEREST PERIOD" means, save as otherwise provided herein:
(a) any of those periods mentioned in Clause 4.5 (Interest Periods);
and
(b) in relation to an Unpaid Sum, any of those periods mentioned in
Clause 23.1 (Default Interest Periods).
"INITIAL ADVANCE DATE" means the first date on which Advances are made
under the Facility.
"INSTRUCTING GROUP" means:
(a) before any Advances have been made, a Bank or Banks whose
Commitments amount in aggregate to more than sixty-six and two
thirds per cent. of the Total Commitments; and
(b) thereafter, a Bank or Banks to whom in aggregate more than
sixty-six and two thirds per cent. of the amount of the Loan is
(or, immediately prior to its repayment, was then) owed.
"INSURANCE PROCEEDS" means the proceeds of any insurance claim intended
to compensate for damage to any asset or interruption of business
received by any member of the UK Group after deducting:
(a) any reasonable out of pocket expenses incurred by any member of
the UK Group in relation to such a claim; and
(b) proceeds relating to third party claims, which are applied
towards meeting such claims.
"INTELLECTUAL PROPERTY" means all patents, trade marks, service marks,
designs, copyrights, design rights, moral rights, inventions,
confidential information, know-how and other intellectual property
rights and interests, whether registered or unregistered, and the
benefit of all licences, applications and rights to use such
intellectual property now or hereafter belonging to any member of the
Covenant Group.
"INTERCREDITOR AGREEMENT" means the agreement dated on or about the
Execution Date between (inter alia) the Banks, the lenders under the
Senior Bank Credit Agreement, the Agent and the Security Trustee, by
which the Banks undertake certain obligations in respect of their rights
under this Agreement.
12
14
"INTER-COMPANY LOAN ASSIGNMENT" means the Assignment Agreement among the
Parent, the Intermediate Parent and the Security Trustee dated on or
about the Execution Date.
"INTERMEDIATE SUBORDINATION AGREEMENT" means the subordination agreement
in the agreed form between the Intermediate Parent (as the lender) and
the Security Trustee, pursuant to which, whilst sums remain outstanding
under the Finance Documents, no payment of interest, repayment of
principal or any other payments of any kind can be made in respect of
indebtedness owed by the Borrower to the Intermediate Parent, save for
certain Permitted Payments.
"INTRA-GROUP SERVICES" means:
(a) the provision of services by a member of the UK Group to a
member of the Group, where such member of the Group requires
those services to enable it to carry on its business and
PROVIDED THAT the consideration for the provision thereof is in
the reasonable opinion of the Borrower no less than the cost
(save in any immaterial respect) incurred by such a member of
the UK Group in providing such services;
(b) the provisions of services constituted by NTL Group Limited
employing personnel, acting as agent to buy equipment or other
assets or trade with residential customers on behalf of other
members of the Group, where the costs of such employment or
purchasing and the costs and revenues generated by such trading
are in the reasonable opinion of the Borrower reimbursed by or
distributed (save in any immaterial respect) to the relevant
Group member; and
(c) the provision of services constituted by NTL Business Limited
(formerly named NTL Technologies Limited) acting as agent to
trade with business customers on behalf of other members of the
Group, where the costs and revenues of such trading are in the
reasonable opinion of the Borrower reimbursed by or distributed
(save in any immaterial respect) to the relevant Group member.
"IRELAND" means the Republic of Ireland.
"LIBOR" means, in relation to any amount to be advanced to or owing by
an Obligor under the Finance Documents on which interest for a given
period is to accrue:
(a) the percentage rate per annum equal to the offered quotation
which appears on the page of the Telerate Screen which displays
the British Bankers Association Interest Settlement Rate for
sterling (being currently "3750") or the currency of any Unpaid
Sum for such period as of 11.00 a.m. on the Quotation Date for
such period or, if such page or such service shall cease to be
available, such other page or such other service for the purpose
of displaying the British Bankers Association Interest
Settlement Rate for sterling (or the currency of such Unpaid
Sum) as the Agent, after consultation with the Banks and the
Borrower, shall select; or
(k) if no quotation for sterling (or the currency of such Unpaid
Sum) and the relevant period is displayed and the Agent has not
selected an alternative service on which a quotation is
displayed, the arithmetic mean (rounded
13
15
upwards to five decimal places) of the rates (as notified to the
Agent) at which each of the Reference Banks was offering to
prime banks in the London interbank market deposits in sterling
(or the currency of such Unpaid Sum) for such period as of 11.00
a.m. on the Quotation Date for such period.
"LICENCES" means each licence which is material to the conduct of the
business of any member of the Covenant Group.
"LMA" means the Loan Market Association.
"LOAN" means, at any time, the aggregate principal amount of the
outstanding Advances at such time.
"MANDATORY COST RATE" means the rate determined in accordance with
Schedule 7 (Mandatory Costs).
"MARGIN" means 4.50 per cent. per annum, provided that the Margin shall
increase by 0.50 per cent. per annum on the three month anniversary of
the Initial Advance Date and by an additional 0.50 per cent. per annum
on each subsequent three month anniversary of the Initial Advance Date.
"MATERIAL ADVERSE EFFECT" means a material adverse effect on (a) the
business, operations, property or condition (financial or otherwise) of
a Covenant Group Obligor or the UK Group taken as a whole or if on or
prior to the Pushdown Date, the UK Group taken as a whole (assuming that
the Pushdown had occurred on the Execution Date) or (b) the ability of
any Covenant Group Obligor to perform its material obligations under the
Finance Documents to which it is a party.
"MATERIAL COMMERCIAL CONTRACTS" means any commercial agreements entered
into by any member of the Covenant Group which are reasonably likely to
be material to the business or prospects of the Covenant Group taken as
a whole.
"MEETINGS" means each of the Court Meeting and EGM.
"NET AVERAGE REVENUE CONTRIBUTIONS" means, at any time:
(a) the aggregate of the Average Revenue Contributions of all assets
disposed of by members of the UK Group under paragraph (f) of
the definition of Permitted Disposals,
less
(b) the aggregate of the estimated Average Revenue Contributions of
all assets acquired by members of the UK Group either in
exchange for, or out of the proceeds of the disposal of, assets
disposed of under paragraph (f) of the definition of Permitted
Disposals (such estimated Average Revenue Contributions to be
reasonably agreed between the Borrower and the Agent on the
basis of the revenues such acquired assets could have reasonably
been expected to have generated for the two financial years of
the Borrower immediately preceding the date of their
acquisition, had such assets been owned by the relevant member
of the UK Group throughout those two financial years).
14
16
"NEW YORK OFFICE EXPENSES" means, in relation to any financial year of
NTL Holdings, the expenses (including taxes) so described and specified
in relation to such financial year in the Business Plan.
"NON-RECOURSE BANK INDEBTEDNESS" means any Financial Indebtedness
incurred by a Non-Recourse Subsidiary from financial institutions
pursuant to a bank credit or loan agreement where the liabilities of
such Non-Recourse Subsidiary in respect of such Financial Indebtedness
are not directly or indirectly the subject of a guarantee, indemnity or
any other form of assurance, undertaking or support from any other
member of the Group (other than the subsidiaries of such person).
"NON-RECOURSE SUBSIDIARY" means a person which is a member of the Group
(other than a member of the Covenant Group, a member of the Target
Group, the Parent and any direct or indirect parent company of the
Parent) and whose creditors have no recourse to any other member of the
Group (other than the subsidiaries of such person) in respect of any
Financial Indebtedness of that person or any of its subsidiaries (other
than recourse to any member of the Group which has granted security over
its shares or other interests in such a Non-Recourse Subsidiary
beneficially owned by it provided that such recourse is limited to the
realisation of such security).
"NOTICE OF DRAWDOWN" means a notice substantially in the form set out in
Schedule 4 (Notice of Drawdown).
"NOTICE PERIOD" means the period commencing ten Business Days before the
proposed date for the making of an Advance and ending 2.00 p.m. three
Business Days before the proposed date for the making of such Advance
(or such later time as all of the Banks may agree).
"NTL CC NOTES" means, to the extent such have been issued in either the
domestic or international capital markets, the bonds, notes or similar
public debt instruments issued by the Parent and outstanding on the
Execution Date.
"NTL HOLDING GROUP" means NTL Holdings and the Borrower's other holding
companies.
"NTL HOLDINGS" means NTL Incorporated (formerly named NTL Holdings
Incorporated), a company incorporated in Delaware which became the
holding company of NTL Delaware Inc. with effect from the effective date
of the CWC Holdings Capital Reduction.
"NTL DELAWARE INC." means NTL (Delaware) Incorporated (formerly named
NTL Incorporated), a company incorporated in Delaware.
"NTL TRIANGLE ACCESSION" means the accession of the members of the NTL
Triangle Sub-Group as guarantors under the Senior Bank Credit Agreement
in accordance with Clause 34.5 (NTL Triangle Accession) of the Senior
Bank Credit Agreement.
"NTL TRIANGLE SUB-GROUP" means NTL Triangle LLC and its subsidiaries
from time to time.
15
17
"NTLIH" means NTL Investment Holdings Limited, a company incorporated in
England and Wales with company number 3173552.
"OBLIGORS" means the Borrower and the Guarantors.
"OFTEL" means the Director General of Telecommunications and/or any
other successor or other body or authority having, inter alia, the
right, function and/or obligation to monitor and enforce compliance with
the provisions of licences issued pursuant to the Telecommunications Xxx
0000.
"ORIGINAL FINANCIAL STATEMENTS" means:
(a) in relation to the Borrower, its audited consolidated financial
statements for its financial year ended 31 December 1998; and
(b) in relation to Intermediate Parent, its audited unconsolidated
financial statements for the financial year ended 31 December
1998; and
(c) in relation to the Target (and insofar as they relate to the CWC
ConsumerCo Business), the consolidated financial statements of
the Target and its subsidiaries, prepared by its auditors, for
the financial year ended 31 March 1999 (as set out in the
Accountants Report) and the consolidated financial statements of
the Target and its subsidiaries, prepared by its management for
the six month period ended 30 September 1999 (as set out in the
CWC Circular).
"OVERDRAFT FACILITY" means any facility provided by a United Kingdom
clearing bank to a member of the UK Group.
"PANEL" means the Panel on Takeovers and Mergers.
"PARENT COVENANT GROUP" means the Parent and each Guarantor.
"PARENT FUNDING" means:
(a) the subscription by the Intermediate Parent for new equity
capital of the Borrower; and
(b) Subordinated Debt incurred by the Borrower from the Intermediate
Parent.
"PARENT SUBORDINATION AGREEMENT" means the subordination agreement in
the agreed form between the Parent (as the lender) and the Security
Trustee, pursuant to which, whilst sums remain outstanding under the
Finance Documents, no payment of interest, repayment of principal or any
other payments of any kind can be made in respect of indebtedness owed
by the Borrower to the Parent, save for certain Permitted Payments.
"PARTICIPATING MEMBER STATE" means any member state of the European
Union which has adopted the euro as its lawful currency at the relevant
time.
"PERMITTED ACQUISITIONS" means:
(a) the Acquisition or any acquisitions necessary to effect either
the issues or transfers of shares referred to in paragraphs (a),
(b), (c), (d), (e) and (f) of the
16
18
definition of the Pushdown set forth in the Senior Bank Credit
Agreement as in effect on the Execution Date;
(b) with respect to any member of the UK Group at any time, any
acquisition of (or of any interests in) (A) companies,
partnerships, consortia, joint ventures or other arrangements or
(B) businesses, licences, revenues or assets provided that:
(i) the relevant company, partnership, consortium, joint
venture or other arrangement or the acquired business,
licence, revenues or asset engages in, or, as the case
may be, relates to, a Cable Business;
(ii) if the total consideration (including, without
limitation, assumed debt, deferred consideration and any
consideration comprising of the issue of either debt
instruments or shares) for such acquisition either (A)
exceeds L80,000,000 (or its equivalent in other
currencies) or (B) when aggregated with the
consideration (determined as aforesaid) arising in
respect of all such other acquisitions (save for any
acquisitions permitted by paragraphs (a), (c), (d), (e)
or (g) of this definition of Permitted Acquisitions)
made by members of the UK Group during the then current
financial year, exceeds L100,000,000 (or its equivalent
in other currencies):
(1) the Borrower has provided the Agent with a pro
forma business plan (over a period ending at least
one year after the Final Maturity Date), together
with the key operating assumptions relating
thereto, has provided representations to the
Finance Parties (in the form agreed by the Agent
(acting reasonably) with respect thereto) in
relation to such business plan and has confirmed
that no Event of Default or Potential Event of
Default has occurred and is continuing or would
occur following such acquisition;
(2) the pro forma business plan demonstrates pro forma
compliance with the financial covenants set out in
Clause 17 (Financial Condition) until the Final
Maturity Date; and
(3) the pro forma business plan demonstrates that
amounts available for drawdown under the Senior
Bank Credit Agreement (following any planned
drawdown to finance the contemplated acquisition)
and under other financing sources committed to the
UK Group are sufficient to meet the UK Group's
projected financing needs until the Final Maturity
Date (excluding the amount of principal to be
repaid in respect to the Senior Bank Credit
Agreement and this Agreement on the respective
maturity date thereof);
(c) the incorporation of a company or the acquisition of the shares
in a newly incorporated company from its subscribing
shareholders, where such a company at all times carries on
business in an administrative capacity, supporting the business
of the UK Group (as carried on in accordance with
17
19
Clause 18.25 (Change of Business) or acts as a holding company
for a Permitted Acquisition within paragraph (b) above;
(d) any acquisition made by a member of the UK Group pursuant to the
implementation of an Asset Passthrough or a member of the UK
Group pursuant to a Funding Passthrough;
(e) any acquisition by a member of the UK Group pursuant to a
Permitted Disposal within paragraphs (g) or (h) of the
definition thereof;
(f) any acquisition by any member of the UK Group of the minority
shareholdings in Northampton Cable Television Limited and/or
Herts Cable Limited; and
(g) any acquisition of assets as referred to in paragraph (a) of the
definition of Asset Adjustment Payments.
"PERMITTED DISPOSAL" means any disposal:
(a) made in the ordinary and usual course of business;
(b) on arm's length commercial terms of an asset by a member of the
UK Group who is not an Obligor;
(c) for cash (if the relevant asset has any value) on arm's length
commercial terms of any surplus or obsolete assets no longer
required for the efficient operation of the business of the UK
Group;
(d) of cash, where such a disposal is not otherwise prohibited by
the Finance Documents;
(e) by way of a realisation of a Permitted Investment;
(f) on (A) arm's length commercial terms for cash consideration or
(B) in exchange for similar assets located in either the United
Kingdom or Ireland which the Agent (acting reasonably)
determines to be of a comparable or superior quality, provided
that:
(i) in each case the Net Average Revenue
Contributions at no time exceed 15 per cent; and
(ii) the proceeds of any disposal under (A) of this
paragraph (f) are applied in accordance with
Clause 9.2 (Mandatory Prepayment from Asset
Disposals);
(g) of an interest in real property by way of a lease or licence
granted by a member of the UK Group to a member of the UK Group;
(h) by a member of the UK Group to another member of the UK Group;
(i) (by way of share sale) of any UK Group Excluded Subsidiary or
any Target Group Excluded Subsidiary (other than Cable &
Wireless Communications (B) Limited) (or any interest therein);
18
20
(j) necessary to effect the transfers of shares referred to in
paragraphs (d), (e) and (j) of the definition of the Pushdown;
(k) (by way of share sale) of NTL Insurance Limited, for fair market
value, to any member of the NTL Holding Group;
(l) (by way of share sale) of Lanbase Xxxxxxx XX, for fair market
value;
(m) of any assets as referred to in paragraph (b) of the definition
of Asset Adjustment Payments; and
(n) of any assets pursuant to the implementation of an Asset
Passthrough or of any funds received pursuant to the
implementation of a Funding Passthrough.
For the avoidance of doubt, in no event shall the transfer of the
shares of the Borrower or any Guarantor to a person which is not a
Guarantor constitute a Permitted Disposal.
"PERMITTED ENCUMBRANCE" means:
(a) any Encumbrance specified in Schedule 5 (Existing Encumbrances),
if the principal amount thereby secured is not increased;
(b) any Encumbrance over or affecting any asset acquired by a member
of the UK Group after the date hereof and subject to which such
asset is acquired, if:
(i) such Encumbrance was not created in contemplation of the
acquisition of such asset by a member of the UK Group;
and
(ii) the Financial Indebtedness secured by such Encumbrance
at all times falls within paragraph (o) of the
definition of Permitted Indebtedness;
(c) any Encumbrance over or affecting any asset of any company
(other than a member of the Target Group) which becomes a member
of the UK Group after the date hereof, where such Encumbrance is
created prior to the date on which such company becomes a member
of the UK Group, if:
(i) such Encumbrance was not created in contemplation of the
acquisition of such company; and
(ii) the Financial Indebtedness secured by such Encumbrance
at all times falls within paragraph (l) or (o) of the
definition of Permitted Indebtedness;
(d) any netting or set-off arrangement entered into by the
Intermediate Parent or any member of the UK Group in the normal
course of its banking arrangements for the purpose of netting
debit and credit balances;
(e) any right of set-off or any title transfer or retention of title
arrangement entered into by the Intermediate Parent or any
member of the UK Group in the normal course of its trading
activities on the counterparty's standard or usual terms (where
such terms reasonably accord with the terms generally adopted in
the market to which such a trading activity relates);
19
21
(f) any lien arising by operation of law or by a contract having a
similar effect and in each case arising or entered into in the
normal course of business, if such lien is discharged within
thirty days of arising;
(g) any Encumbrance created pursuant to, arising under or evidenced
by the Security Documents;
(h) any Encumbrance granted by a member of the UK Group over the
shares or other interests it holds in, or over the assets
attributable to, a Project Company;
(i) any Encumbrance created by any arrangements referred to in
paragraph (e) or paragraph (f) of the definition of Indebtedness
for Borrowed Money;
(j) any Encumbrance arising pursuant to an order of attachment, an
injunction restraining the disposal of assets or any similar
legal process in each case arising in connection with court
proceedings being diligently conducted by a member of the
Covenant Group in good faith;
(k) any Encumbrance over cash deposited as security for the
obligations of a member of the UK Group in respect of a
performance bond, guarantee, standby letter of credit or similar
facility entered into by such a member of the UK Group in the
ordinary course of business;
(l) any Encumbrance on assets of the UK Group or the Intermediate
Parent securing the obligations under the Senior Bank Credit
Agreement;
(m) any Encumbrance securing Permitted Indebtedness falling within
paragraph (i) of the definition of that term;
(n) any Encumbrance constituted by a rent deposit deed entered into
on arm's length terms and in the ordinary course of business
securing the obligations of a member of the UK Group in relation
to property leased to a member of the UK Group; and
(o) any Encumbrance securing Permitted Indebtedness falling within
paragraph (p) of the definition of that term.
"PERMITTED INDEBTEDNESS" means any Financial Indebtedness:
(a) arising under or permitted pursuant to the Finance Documents;
(b) of the Intermediate Parent, any other Guarantor (other than the
Parent) or the Borrower, in respect of the Subordinated Debt and
provided, in the case of the Intermediate Parent and the
Borrower, that the indebtedness in respect of it constitutes
Assigned Debt;
(c) of a member of the UK Group, from the Borrower or any other
member of the UK Group;
(d) of members of the UK Group under the Senior Bank Credit
Agreement which does not exceed L2,500,000,000 at any time
outstanding less the amount of permanent repayment of amounts
outstanding thereunder and/or (without
20
22
duplication) permanent reductions in the commitments thereunder
(whether the occurring prior to the Pushdown Date or
thereafter);
(e) of the UK Group arising in relation to the implementation of the
Hedging Strategy;
(f) of the Parent, under the NTL CC Notes;
(g) of the Parent, where:
(i) such Financial Indebtedness does not have any scheduled
repayments or other amortisations prior to, and has a
final maturity date no earlier than, the date one year
after the Final Maturity Date;
(ii) after giving effect thereto, the requirements of
subclause 17.1.1 through 17.1.4 would be satisfied on a
pro forma basis; and
(iii) Capital Event Proceeds of such Financial Indebtedness
are applied by the Borrower in cancellation of the Loan
in accordance with Clause 9.6 (Application of Proceeds)
to the extent required by Clause 9.5 (Mandatory
Prepayment from Capital Event Proceeds);
(h) of the Covenant Group, arising under Permitted Loans and
Guarantees;
(i) on and after the Pushdown Date, of the UK Group, arising under
one or more credit facilities which does not exceed
L1,000,000,000 in the aggregate principal amount at any one time
outstanding less the amount of permanent repayment of amounts
outstanding thereunder and/or (without duplication) permanent
reductions in the commitments thereunder (it being understood
that the Financial Indebtedness permitted by this clause (i)
may, but shall not be required to be, incurred under the Senior
Bank Credit Agreement);
(j) of the UK Group, falling within paragraph (e) of the definition
of Indebtedness for Borrowed Money ("FINANCE LEASE DEBT") which,
when aggregated with any other Finance Lease Debt incurred in
reliance on this paragraph (j) by each member of the UK Group
does not exceed L45,000,000 (or its equivalent);
(k) arising in respect of Existing Performance Bonds;
(l) of any company which becomes a member of the UK Group after the
date hereof, where such Financial Indebtedness arose prior to
the date on which such company becomes a member of the UK Group,
if:
(i) such Financial Indebtedness was not created in
contemplation of the acquisition of such company;
(ii) the aggregate amount of all Financial Indebtedness
falling within this paragraph (l) does not exceed
L20,000,000 (or its equivalent); and
(iii) such Financial Indebtedness is repaid within three
months of such company becoming a member of the UK
Group;
21
23
(m) of members of the UK Group under the Secured Ancillary
Facilities or in relation to any documentary or standby letter
of credit facility or performance bond facility made available
by a financial institution on an unsecured basis PROVIDED THAT
the aggregate indebtedness of all members of the UK Group in
relation to such facilities and the Secured Ancillary Facilities
does not exceed L40,000,000 (or its equivalent);
(n) of the UK Group in respect of Permitted Overdraft Borrowings,
provided that the aggregate amount of such Financial
Indebtedness does not exceed L20,000,000 (or its equivalent);
(o) arising in relation to either an Asset Passthrough or a Funding
Passthrough PROVIDED THAT any such Financial Indebtedness is
Subordinated Debt if it is owed by a Covenant Group Obligor to a
member of the Group and Assigned Debt if it is owed by the
Borrower to the Intermediate Parent or by the Intermediate
Parent to the Parent; and
(p) not falling within paragraphs (a) through (o) above, of any
member of the UK Group, PROVIDED THAT the aggregate amount of
such Financial Indebtedness does not exceed L20,000,000 (or its
equivalent).
"PERMITTED INVESTMENTS" means:
(a) any debt securities which are readily marketable and which are
rated at least "AA" by Standard & Poor's Corporation or "Aa2" by
Xxxxx'x Investors Service, Inc.;
(b) certificates of deposit and deposits with banks and bankers
acceptances in each case with a bank rated at least A- (or the
equivalent thereof) by Xxxxx'x Investors Service, Inc. or
Standard & Poor's Corporation; or
(c) commercial paper rated at least A-1 (or the equivalent thereof)
by Xxxxx'x Investors Service, Inc. or Standard & Poor's
Corporation.
"PERMITTED LOANS AND GUARANTEES" means:
(a) trade credit or guaranties or indemnities granted in the
ordinary course of business on usual and customary terms;
(b) loans made by any member of the UK Group to its employees either
(i) in the ordinary course of its employees' employment or (ii)
to fund the exercise of share options by its employees;
(c) loans permitted pursuant to subclauses (b) and (c) of the
definition of Permitted Indebtedness;
(d) loans made by a member of the UK Group to a member of the
Covenant Group where the proceeds of such a loan are either
directly or indirectly used to fund a Permitted Payment;
(e) loans made, credit granted and guarantees or indemnities given
in an aggregate amount not exceeding L200,000 (or its
equivalent);
22
24
(f) any loan made to a UK Group Excluded Subsidiary made out of
Available Excess Cash Flow;
(g) any guarantee or indemnity given by a member of the UK Group in
respect of any Permitted Indebtedness, or other obligation not
restricted by the terms of the Finance Documents, of another
member of the UK Group;
(h) credits granted by any member of the UK Group to a member of the
Group, where the indebtedness outstanding thereunder relates to
Intra-Group Services; and
(i) loans made to either of the Telecential Partnerships outstanding
on the Execution Date or made in accordance with Clause 18.16
(Telecential Partnerships).
"PERMITTED OVERDRAFT BORROWINGS" means Financial Indebtedness in respect
of an Overdraft Facility if such Financial Indebtedness:
(a) has been incurred solely for short term cash management purposes
in the ordinary course of business;
(b) is fully repaid within three Business Days of it having been
incurred (from available funds other than Permitted Overdraft
Borrowings); and
(c) is not outstanding at any time between the date on which the
Pushdown Condition is satisfied and the Pushdown Date.
"PERMITTED PAYMENT" means a Restricted Payment which is:
(a) made after 31 December 2003 and funded from Available Excess
Cash Flow;
(b) made, at any time, to fund the payment of New York Office
Expenses, the amount of such payments during each financial year
of the Borrower being no greater than the amount of New York
Office Expenses so attributed for that financial year in the
Business Plan;
(c) made, at any time, to fund the cash payment obligations of the
Parent or any other member of the NTL Holding Group in relation
to:
(i) the NTL CC Notes;
(ii) any Permitted Refinancings within either paragraph (a)
of the definition thereof or any refinancing of this
Facility;
(iii) subject to the NTL Triangle Accession having been
completed, any Permitted Refinancings within paragraph
(c) of the definition thereof; or
(iv) any bonds, notes or similar public debt instruments
issued by any member of the NTL Holding Group after the
date hereof, in either the domestic or the international
capital markets, to the extent that the proceeds thereof
have been invested into the Borrower;
23
25
which, in either case, has fallen due or will fall due within
five Business Days; or
(d) made pursuant to an Asset Passthrough and funded solely from
cash generated by entities outside of the Covenant Group or made
available pursuant to a Funding Passthrough and funded solely
from cash generated by entities outside of the Covenant Group;
or
(e) deposited in the Charged Account and:
(i) represents the proceeds from a payment of interest on
Subordinated Debt, being paid by the Borrower to the
Intermediate Parent and then paid by the Intermediate
Parent to the Parent and by the Parent to NTL (Delaware)
Inc. in accordance with arrangements the Group has with
the Inland Revenue; and
(ii) is reinvested in the Borrower within ten Business Days
of the date of the Restricted Payment, such an
investment being by way of Subordinated Funding or
Parent Funding;
(f) of an amount of up to L2,000,000 made to NTL, Inc. to finance
payments to be made by NTL, Inc. to Cable & Wireless in relation
to certain Acquisition overhead costs; or
(g) made out the proceeds of an Asset Adjustment Payment referred to
in paragraph (b) of the definition thereof received by a member
of the Target Group; or
(h) made by either a member of the Target Group or NTL Business
Limited where the proceeds of such a Restricted Payment are to
be used by NTL Holdings to make a Debt Adjustment Payment to
Cable & Wireless in accordance with paragraph (b) of the
definition thereof,
and provided in each case that such payment shall only be permitted if
and to the extent that no Event of Default has occurred (and is
continuing) or would result from the making of such payment.
"PERMITTED REFINANCINGS" means any refinancing of:
(a) the NTL CC Notes by the Parent;
(b) the Diamond Notes, by the Parent; or
(c) the Triangle Notes, by the Parent;
PROVIDED THAT, in each case, the final maturity date of the indebtedness
incurred in respect of such refinancing is a date no earlier than the
day falling one year after the Final Maturity Date.
"PLEDGE AGREEMENT" means the Pledge Agreement in agreed form executed or
to be executed by the Parent in favour of the Security Trustee relating
to 100% of the capital stock of the Intermediate Parent.
24
26
"POTENTIAL EVENT OF DEFAULT" means any event which would become (with
the passage of time, the giving of notice, the making of any
determination hereunder or any combination thereof) an Event of Default.
"PREPAYMENT ESCROW ACCOUNT" means an account, bearing interest at a
commercially reasonable rate in relation to the given circumstances,
held with the Agent (or such other financial institution reasonably
acceptable to the Agent) in the name of the Borrower, over which the
Borrower has granted or will grant security in favour of the Security
Trustee and into which sums are deposited in accordance with Clause 9
(Mandatory Prepayment).
"PROJECT COMPANY" means a subsidiary of the Borrower (or a person in
which a subsidiary of the Borrower has an interest), which has a special
purpose and whose creditors have no recourse to any other member of the
Covenant Group in respect of any Financial Indebtedness of that person
or any of its subsidiaries (other than recourse to any member of the UK
Group which has granted security over its shares or other interest in
such a Project Company beneficially owned by it provided that such
recourse is limited to the realisation of such security).
"PROPERTIES" means the properties owned or leased by members of the UK
Group.
"PUSHDOWN" has the meaning given to it in the Senior Bank Credit
Agreement as in effect on the Execution Date.
"PUSHDOWN CONDITION" means that each of the following conditions has
been satisfied:
(a) the Pushdown has been completed in all material respects in
accordance with the terms of the Senior Bank Credit Agreement as
in effect on the Execution Date;
(b) on the Pushdown Date, and after giving effect to the Pushdown,
all representations and warranties set forth in this Agreement
are true in all material respects;
(c) on the Pushdown Date and prior to giving effect to the Pushdown,
the Target Group shall be in compliance with all of the
covenants set forth in the Senior Bank Credit Agreement as in
effect on the Execution Date;
(d) on the Pushdown Date, and after giving effect to the Pushdown,
no Event of Default or Potential Event of Default shall be
continuing; and
(e) the Agent shall have received a certificate of the Borrower
certifying that the conditions set forth in paragraphs (a)
through (d) above have been satisfied.
"PUSHDOWN DATE" means the date upon which the Pushdown is completed.
"QUALIFYING LENDER" means:
(a) a Bank which is (on the date a payment of interest falls due
under a Finance Document) beneficially entitled to and within
the charge to United Kingdom corporation tax in respect of that
payment provided that the advance in respect of which the
payment is made was made by a bank for the purposes of section
349 of ICTA at the time that the advance was made; or
25
27
(b) a Treaty Lender.
"QUARTER DATE" has the meaning given to it in Clause 17.2 (Financial
Definitions).
"QUOTATION DATE" means, in relation to any period for which an interest
rate is to be determined under the Finance Documents, the day on which
quotations would ordinarily be given by prime banks in the London
Interbank Market for deposits in the currency of the relevant sum for
delivery on the first day of that period, PROVIDED THAT, if, for any
such period, quotations would ordinarily be given on more than one date,
the Quotation Date for that period shall be the last of those dates.
"REFERENCE BANKS" means:
(a) whilst the financial institutions named in Schedule 1 (The
Banks) are the only Banks hereunder, the principal London
offices of The Chase Manhattan Bank; and
(b) at any other time, the principal London offices of The Chase
Manhattan Bank, and the principal London offices of two other
Banks agreed between the Agent and the Borrower on or before the
Syndication Date,
or such other bank or banks as may from time to time be agreed between
the Borrower and the Agent acting on the instructions of an Instructing
Group.
"RELEVANT PERIOD" has the meaning given to it in Clause 17.2 (Financial
Definitions).
"REMEDY RESTRICTION PERIOD" means any period during which the rights and
remedies of the Banks which would otherwise arise by reason of an Event
of Default (whether or not such Event of Default is deemed waived
pursuant to the Intercreditor Agreement) are restricted, delayed or
suspended, or the Banks are required to waive (or are deemed to have
waived) conditions to drawdown hereunder, pursuant to the terms of the
Intercreditor Agreement as in effect on the Execution Date.
"REPEATED REPRESENTATIONS" means each of the representations set out in
Clause 15.2 (Status and Due Authorisation), Clause 15.4 (No Immunity),
Clause 15.7 (Binding Obligations), Clause 15.9 (No Material Defaults) to
Clause 15.11 (Audited Financial Statements), Clause 15.16 (Budgets),
Clause 15.21 (Execution of this Agreement), Clause 15.25 (Intellectual
Property), Clause 15.26 (Security Interest) and Clause 15.27 (Group
Structure).
"REQUIRED PERCENTAGE" means:
(a) in the case of the first L700,000,000 of Capital Event Proceeds
(other than Capital Event Proceeds arising from the Incremental
Amount) received by the Group after the Execution Date, 50 per
cent.;
(b) in the case of Capital Event Proceeds (other than Capital Events
Proceeds arising from the Incremental Amount) received by the
Group after the Execution Date which exceed L700,000,000, 70 per
cent.; and
(c) in the case of Capital Event Proceeds arising from the
Incremental Xxxxxx, 000 per cent.
26
28
"RESERVATIONS" means:
(a) the principle that equitable remedies are remedies which may be
granted or refused at the discretion of the court, the
limitation of enforcement by laws relating to bankruptcy,
insolvency, liquidation, reorganisation, court schemes,
moratoria, administration and other laws generally affecting the
rights of creditors, the time barring of claims under any
applicable law, the possibility that an undertaking to assume
liability for or to indemnify against non-payment of any stamp
duty or other tax may be void, defences of set-off or
counterclaim and similar principles;
(b) anything analogous to any of the matters set out in paragraph
(a) above under any laws of any applicable jurisdiction; and
(c) the reservations in or anything disclosed by any of the legal
opinions delivered pursuant to Clause 2.4 (Conditions Precedent)
and Schedule 3 (Conditions Precedent).
"RESTRICTED GROUP" means any member of the Group other than a member of
the UK Group.
"RESTRICTED PAYMENT" means any payment by a member of the Covenant Group
to a member of the Restricted Group whether by way of dividend or other
distribution, loan, interest or the payment of interest on or repayment
of the principal amount of inter-company Indebtedness for Borrowed
Money.
"SCHEME" means the scheme of arrangement under Section 425 in relation
to the Target, as detailed in appendix 12 of the CWC Circular (or with
such modifications, additions or conditions as may be approved or
imposed by the Court).
"SCHEME DOCUMENTS" means the CWC Circular, including the notice of Court
Meeting and of the EGM set out therein and the resolutions of such Court
Meeting and EGM.
"SCHEME EFFECTIVE DATE" the date upon which an office copy of the order
of the Court sanctioning the Scheme and the cancellation of the Target's
shares covered by the Scheme was registered by the Registrar of
Companies being 12 May 2000.
"SECOND CAXTON SALE" means the transfer of Caxton by CWC Holdings to C&W
(UK) Holdings in part satisfaction of the CWC Holdings Capital
Reduction.
"SECTION 425" means section 425 of the Companies Xxx 0000.
"SECURED ANCILLARY FACILITIES" has the meaning given to it in the Senior
Bank Credit Agreement as in effect on the Execution Date.
"SECURITY" means the security from time to time constituted by or
pursuant to the Security Documents and the guarantees provided
hereunder.
27
29
"SECURITY DOCUMENTS" means the Pledge Agreement, the Share Charge, the
Inter-Company Loan Assignment and any other agreement or document
pursuant to which any member of the Group creates any security interest
in favour of the Finance Parties (or the Security Trustee on their
behalf) for all or any part of the obligations of the Obligors or any of
them under any of the Finance Documents.
"SECURITY TRUST AGREEMENT" means the security trust agreement entered
into or to be entered into in connection herewith between the Parent,
the Intermediate Parent and the Security Trustee.
"SENIOR AGENT" means the person from time to time appointed as agent of
the banks under the Senior Bank Credit Agreement.
"SENIOR BANK CREDIT AGREEMENT" means the L2,500,000,000 Credit Agreement
dated on or about the date hereof among the Borrower, NTL Technologies,
the Parent, Chase Manhattan Plc and Xxxxxx Xxxxxxx Xxxx Xxxxxx Bank
Limited, as arrangers and joint book managers, Chase Manhattan
International Limited, as agent and security trustee and others.
"SHARE CHARGE" means the share charge in agreed form executed or to be
executed by the Intermediate Parent in favour of the Security Trustee
relating to 65% of the issued share capital of the Borrower.
"SPECIFIED FINANCIAL INDEBTEDNESS" means any Financial Indebtedness of
the Parent or any Guarantor (other than arising in respect of any
letters of credit or performance bonds issued at the request of a member
of the Group in the ordinary course of its business) arising under (a)
the NTL CC Notes, (b) any Permitted Refinancing and (c) any Financial
Indebtedness incurred to refinance the Facility in whole or in part.
"STATUTORY REQUIREMENTS" means any applicable provision or requirement
of any Act of Parliament including the Telecommunications Xxx 0000, the
Cable and Xxxxxxxxxxxx Xxx 0000 and the Cable and the Broadcasting Xxx
0000 or any instrument, rule or order made under any Act of Parliament
or any regulation or by-law of any local or other competent authority or
any statutory undertaking or statutory company which has jurisdiction in
relation to the carrying out, use, occupation, operation of the
properties or the businesses of any member of the UK Group (or, prior to
the Pushdown Date, the Target Group) carried out thereon.
"STEERING COMMITTEE GROUP" means the Arrangers.
"SUBORDINATED DEBT" means any loan made by the Parent to any Guarantor
which is a direct subsidiary of the Parent or by any Guarantor to the
Borrower or any other Guarantor provided that in each case (x) the
lender of such loan is the direct parent of the borrower of such loan
and (y) such loan has been subordinated to the Loan on the terms of a
Subordination Agreement.
"SUBORDINATED FUNDING" means:
(a) the subscription by the Parent for new equity capital of the
Intermediate Parent; and
28
30
(b) Subordinated Debt.
"SUBORDINATION AGREEMENT" means each subordination agreement in the
agreed form executed or to be executed in connection herewith pursuant
to which the indebtedness identified therein owed by any Guarantor
(including, without limitation, the Intermediate Parent) or the
Borrower, as the case may be, is subordinated to the obligations of the
Obligors under the Finance Documents.
"SUBSEQUENT PARTICIPANT" means a member state that adopts the euro as
its lawful currency after 1 January 1999.
"SYNDICATION DATE" means the earlier of (a) the day specified by the
Arrangers, after having given five Business Days prior notice to the
Borrower, as the day on which primary syndication of the Facility is
completed and (b) the day falling six months after the date hereof.
"TARGET" means Cable and Wireless Communications plc (company number
3288998).
"TARGET GROUP" means CWC Holdings, Target and its direct and indirect
subsidiaries (other than the Target Group Excluded Subsidiaries (as
defined in the Senior Bank Credit Agreement)) immediately after the
Second Caxton Sale, such comprising the CWC ConsumerCo Business and, for
the purpose of Clause 17.2 (Financial Definitions) and any other
provisions of this Agreement using the definitions defined in Clause
17.2 (Financial Definitions), NTL Business Limited.
"TELECENTIAL PARTNERSHIPS" means:
(a) Telecential Communications (Herts) Partnership, a partnership
between CableTel Limited and CableTel Investments Limited
(acting through the Telecential Communications Partnership),
Maza Limited and Herts Cable Limited; and
(b) Telecential Communications (Northants) Partnership, a
partnership between CableTel Limited and CableTel Investments
Limited (acting through the Telecential Communications
Partnership), Maza Limited and Northampton Cable Television
Limited.
"TOTAL COMMITMENTS" means, at any time, the aggregate of the Banks'
Commitments.
"TOTAL NET CASH FINANCE CHARGES" has the meaning given to it in Clause
17.2 (Financial Definitions).
"TRANSACTION AGREEMENT" means the restated agreement dated as of 26 July
1999 between Xxxx Atlantic Corporation, Cable & Wireless, the Target and
NTL Delaware Inc. (as amended from time to time before the date of this
Agreement).
"TRANSFER CERTIFICATE" means a certificate substantially in the form set
out in Schedule 2 (Form of Transfer Certificate) or in such other form
as may be agreed between the Borrower and the Agent signed by a Bank and
a Transferee under which:
(a) such Bank seeks to procure the transfer to such Transferee of
all or a part of such Bank's rights, benefits and obligations
under the Finance Documents upon
29
31
and subject to the terms and conditions set out in Clause 30.3
(Assignments and Transfers by Banks); and
(b) such Transferee undertakes to perform the obligations it will
assume as a result of delivery of such certificate to the Agent
as contemplated in Clause 30.5 (Transfers by Banks).
"TRANSFER DATE" means, in relation to any Transfer Certificate, the date
for the making of the transfer as specified in such Transfer
Certificate.
"TRANSFEREE" means a person to which a Bank seeks to transfer by
novation all or part of such Bank's rights, benefits and obligations
under the Finance Documents.
"TREATY LENDER" means a Bank which is (on the date a payment falls due
under a Finance Document) entitled to that payment under a double
taxation agreement in force with the United Kingdom on that date
(subject to the completion of any necessary procedural formalities)
without a deduction or withholding for or on account of tax imposed by
the United Kingdom from such a payment.
"TREATY ON EUROPEAN UNION" means the Treaty of Rome of 25 March 1957, as
amended by the Single Xxxxxxxx Xxx 0000 and the Maastricht Treaty (which
was signed at Maastricht on 7 February 1992 and came into force on 1
November 1993).
"TRIANGLE NOTES" means the 11.2% senior discount debentures due 15
November 2007, with a principal amount at maturity of $517,300,000,
issued by NTL Triangle LLC (formerly known as Comcast UK Cable Partners
Limited).
"UNPAID SUM" means the unpaid balance of any of the sums referred to in
Clause 23.1 (Default Interest Periods).
"UK GROUP" means:
(a) for the purpose of Clause 17.1 (UK Group Financial Condition),
Clause 17.2 (Financial Definitions) and any other provision of
this Agreement using the definitions defined in Clause 17.2
(Financial Definitions):
(i) the Borrower;
(ii) Northampton Cable Television Limited and Herts Cable
Limited;
(iii) Cable & Wireless Communications (South Hertfordshire)
Limited;
(iv) each of the Borrower's direct and indirect subsidiaries
from time to time, excluding the UK Group Excluded
Subsidiaries (other than Northampton Cable Television
Limited, Herts Cable Limited and Cable & Wireless
Communications (South Hertfordshire) Limited; and
(v) prior to the Pushdown Date, the Target Group (including
NTL Business Limited); and
(b) for all other purposes, the Borrower and each of its direct or
indirect subsidiaries from time to time other than the UK Group
Excluded Subsidiaries. For information purposes only, the
members of the UK Group on the Execution
30
32
Date (as defined by this paragraph (b)) are listed on Schedule
14 to the Senior Bank Credit Agreement.
"UK GROUP EXCLUDED SUBSIDIARY" means:
(a) any subsidiary of the Borrower which is a Dormant Subsidiary and
which (i) has assets (save for loans existing on the Execution
Date owed to it by other members of the UK Group) with an
aggregate value of L10,000 or less and (ii) does not hold a
Licence;
(b) X-Tant Limited and its subsidiaries;
(c) Northampton Cable Television Limited (until such time as it
becomes a wholly owned subsidiary of the Borrower);
(d) Herts Cable Limited (until such time as it becomes a wholly
owned subsidiary of the Borrower);
(e) any member of the NTL Triangle Sub-Group (until such time as the
Parent elects for the members of the NTL Triangle Sub-Group to
become members of the UK Group in accordance with Clause 34.5
(NTL Triangle Accession) of the Senior Bank Credit Agreement;
(f) any Target Group Excluded Subsidiaries which become subsidiaries
of the Borrower pursuant to the Pushdown;
(g) any subsidiary of the Borrower which is a Project Company; and
(h) any company (other than a member of the Target Group) which
becomes a subsidiary of the Borrower after the date hereof
pursuant to an Asset Passthrough,
PROVIDED THAT, any of such companies shall become a member of the UK
Group and cease to be a UK Group Excluded Subsidiary if the Borrower and
the Agent (acting on the instructions of an Instructing Group, acting
reasonably) so agree.
1.2 INTERPRETATION
Any reference in this Agreement to:
the "AGENT", an "ARRANGER", the "SECURITY TRUSTEE" or any "BANK" shall
be construed so as to include it and any subsequent successors and
permitted transferees in accordance with their respective interests;
an "AFFILIATE" of a specified person means any other person directly or
indirectly controlling or controlled by or under direct or indirect
common control with that specified person, where:
(a) "CONTROL" (and "CONTROLLING", "CONTROLLED BY" and "UNDER COMMON
CONTROL WITH") mean the possession, directly or indirectly, of
the power to direct or cause the direction of the management or
policies of a person, whether by the ownership of shares, by
agreement or otherwise; and
31
33
(b) the beneficial ownership of 10 per cent. or more of the issued
share capital of a person shall be deemed to constitute control
of that person;
"AGREED FORM" in relation to any document means a form which is
initialled by each of the Agent and the Borrower for the purposes of
identification (as such form may be amended from time to time by
agreement between such parties) or a document executed on or before the
Execution Date by (among others) the Parent or the Borrower and the
Agent or, if not so executed or initialed, a document in form and
substance reasonably satisfactory to the Agent;
"ASSETS" includes present and future properties, revenues and rights of
every description;
a "COMPANY" includes any body corporate;
"CONTINUING", in relation to an Event of Default, shall be construed as
a reference to an Event of Default which has not been waived (any deemed
waiver pursuant to the Intercreditor Agreement not being a waiver for
these purposes) in writing or remedied and, in relation to a Potential
Event of Default, one which has not been remedied within the relevant
grace period or waived (any deemed waiver pursuant to the Intercreditor
Agreement not being a waiver for these purposes) in accordance with the
terms hereof;
"DISPOSAL" includes any sale, lease, transfer or other disposal;
the "EQUIVALENT" on any date in one currency (the "FIRST CURRENCY") of
an amount denominated in another currency (the "SECOND CURRENCY") is a
reference to the amount of the first currency which could be purchased
with the amount of the second currency at the spot rate of exchange
quoted by the Agent at or about 11.00 a.m. on such date for the purchase
of the first currency with the second currency;
a "HOLDING COMPANY" of a company or corporation shall be construed as a
reference to any company or corporation of which the first-mentioned
company or corporation is a subsidiary;
"INDEBTEDNESS" shall be construed so as to include any obligation
(whether incurred as principal or as surety) for the payment or
repayment of money, whether present or future, actual or contingent;
a "LAW" shall be construed as any law (including common or customary
law), statute, constitution, decree, judgment, treaty, regulation,
directive, bye-law, order or any other legislative measure of any
government, supranational, local government, statutory or regulatory
body or court;
a "MEMBER STATE" shall be construed as a reference to a member state of
the European Union;
a "MONTH" is a reference to a period starting on one day in a calendar
month and ending on the numerically corresponding day in the next
succeeding calendar month save that:
(a) if any such numerically corresponding day is not a Business Day,
such period shall end on the immediately succeeding Business Day
to occur in that next succeeding calendar month or, if none, it
shall end on the immediately preceding Business Day; and
32
34
(b) if there is no numerically corresponding day in that next
succeeding calendar month, that period shall end on the last
Business Day in that next succeeding calendar month,
(and references to "MONTHS" shall be construed accordingly);
a "PERSON" shall be construed as a reference to any person, firm,
company, corporation, government, state or agency of a state or any
association or partnership (whether or not having separate legal
personality) of two or more of the foregoing;
"REPAY" (or any derivative form thereof) shall, subject to any contrary
indication, be construed to include "PREPAY" (or, as the case may be,
the corresponding derivative form thereof) and vice versa;
a "SUBSIDIARY" of a company or corporation shall be construed as a
reference to:
(a) any company or corporation:
(i) which is controlled, directly or indirectly, by the
first-mentioned company or corporation;
(ii) more than half the issued share capital of which is
beneficially owned, directly or indirectly, by the
first-mentioned company or corporation; or
(iii) which is a subsidiary of another subsidiary of the
first-mentioned company or corporation,
and, for these purposes, a company or corporation shall be
treated as being controlled by another if that other company or
corporation is able to direct its affairs and/or to control the
composition of its board of directors or equivalent body; and
(b) for the purposes of only Clause 16 (Financial Information),
Clause 17 (Financial Condition) and where the financial
definitions referred to in Clause 17.2 (Financial Definition)
are used in this Agreement, any company or corporation which is
a subsidiary undertaking as defined in Section 258 of the
Companies Xxx 0000 or any other legal entity which is accounted
for as a subsidiary of that first mentioned company or
corporation;
a "SUCCESSOR" shall be construed so as to include an assignee or
successor in title of such party and any person who under the laws of
its jurisdiction of incorporation or domicile has assumed the rights and
obligations of such party under this Agreement or to which, under such
laws, such rights and obligations have been transferred;
"TAX" shall be construed so as to include any tax, levy, impost, duty or
other charge of a similar nature (including any penalty or interest
payable in connection with any failure to pay or any delay in paying any
of the same);
"VAT" shall be construed as a reference to value added tax including any
similar tax which may be imposed in place thereof from time to time;
a "WHOLLY-OWNED SUBSIDIARY" of a company or corporation shall be
construed as a reference to any company or corporation which has no
other members except that other
33
35
company or corporation and that other company's or corporation's
wholly-owned subsidiaries or persons acting on behalf of that other
company or corporation or its wholly-owned subsidiaries; and
the "WINDING-UP", "DISSOLUTION" or "ADMINISTRATION" of a company or
corporation shall be construed so as to include any equivalent or
analogous proceedings under the law of the jurisdiction in which such
company or corporation is incorporated or any jurisdiction in which such
company or corporation carries on business including the seeking of
liquidation, winding-up, reorganisation, dissolution, administration,
arrangement, adjustment, protection or relief of debtors.
1.3 CURRENCY SYMBOLS
1.3.1 "L" and "STERLING" denote lawful currency of the United
Kingdom and "$" and "DOLLARS" denote lawful currency of the
United States of America.
1.3.2 "EURO" means the single currency unit of the European Union as
constituted by the Treaty on European Union as referred to in
EMU Legislation and "EURO UNIT" means the currency unit of the
euro as defined in EMU Legislation.
1.4 AGREEMENTS AND STATUTES
Any reference in a Finance Document to:
1.4.1 this Agreement or any other agreement or document shall be
construed as a reference to this Agreement or, as the case may
be, such other agreement or document as the same may have
been, or may from time to time be, amended, varied, novated or
supplemented; and
1.4.2 a statute or treaty shall be construed as a reference to such
statute or treaty as the same may have been, or may from time
to time be, amended or, in the case of a statute, re-enacted.
1.5 HEADINGS
Clause and Schedule headings are for ease of reference only.
1.6 TIME
Any reference in this Agreement to a time of day shall, unless a
contrary indication appears, be a reference to London time.
1.7 THIRD PARTY RIGHTS
A person who is not a party to this Agreement has no right under the
Contracts (Rights of Third Parties) Xxx 0000 to enforce any term of this
Agreement.
2. THE FACILITY
2.1 GRANT OF THE FACILITY
The Xxxxx xxxxx to the Borrower, upon the terms and subject to the
conditions hereof, a sterling multiple draw loan facility in an
aggregate amount of L1,300,000,000, as the same may be reduced in
accordance with the terms hereof.
2.2 PURPOSE
The Facility is intended to fund loans by the Borrower to other members
of the UK Group each of which shall utilize the proceeds thereof to
finance the working capital
34
36
requirements of the UK Group, provided that in no event shall the
proceeds of any Advance be used for a purpose other than to finance the
construction, capital expenditure and working capital needs of a Cable
Business.
2.3 APPLICATION
The Borrower shall apply all amounts raised by it hereunder in or
towards satisfaction of, the purposes specified in Clause 2.2 (Purpose)
and none of the Finance Parties shall be obliged to concern themselves
with such application.
2.4 CONDITIONS PRECEDENT
Save as the Banks may otherwise agree, the Borrower may not deliver any
Notice of Drawdown unless the Agent has confirmed to the Borrower and
the Banks that it has received all of the documents and other evidence
listed in Schedule 3 (Conditions Precedent) and that each is, in form
and substance, satisfactory to the Agent. The Agent shall notify the
Borrower and the Banks promptly upon being so satisfied.
2.5 BANKS' OBLIGATIONS SEVERAL
The obligations of each Bank are several and the failure by a Bank to
perform its obligations hereunder shall not affect the obligations of an
Obligor towards any other party hereto nor shall any other party be
liable for the failure by such Bank to perform its obligations
hereunder.
2.6 BANKS' RIGHTS SEVERAL
The rights of each Bank are several and any debt arising hereunder at
any time from an Obligor to any of the other parties hereto shall be a
separate and independent debt. Each such party shall be entitled to
protect and enforce its individual rights arising out of this Agreement
independently of any other party (so that it shall not be necessary for
any party hereto to be joined as an additional party in any proceedings
for this purpose).
3. UTILISATION OF THE FACILITY
3.1 DRAWDOWN CONDITIONS FOR ADVANCES
An Advance will be made by the Banks to the Borrower if:
3.1.1 during the Notice Period, the Agent has received a completed
Notice of Drawdown from the Borrower;
3.1.2 the proposed date for the making of such Advance is a Business
Day falling one month or more before the Final Maturity Date;
3.1.3 the proposed amount of such Advance is (a) if less than the
Available Facility an amount or integral multiple of L50,000,000
or (b) equal to the amount of the Available Facility;
3.1.4 there would not, immediately after the making of such an
Advance, be more than five Advances outstanding;
3.1.5 neither of the events mentioned in sub-clauses 5.1.1 and 5.1.2
of Clause 5.1 (Market Disruption and Alternative Interest Rates)
shall have occurred;
35
37
3.1.6 to the extent that the initial aggregate principal amount of
Advances made under this Facility would exceed L300,000,000
after giving effect to the making of such Advance, the Pushdown
Condition has been satisfied;
3.1.7 on and as of the proposed date for the making of such Advance
(i) no Event of Default or Potential Event of Default is
continuing and (ii) the Repeated Representations are true in all
material respects;
3.1.8 the cash on hand of the UK Group at the close of business on the
Business Day immediately preceding the date the Notice of
Drawdown for such Advance is delivered to the Agent shall not
exceed L25,000,000; and
3.1.9 in the case of Advances made on or after the Pushdown Date, the
advances which are outstanding under the Senior Bank Credit
Agreement shall equal at least L2,500,000,000 less any permanent
reductions to the availability thereunder made after the
Execution Date.
3.2 EACH BANK'S PARTICIPATION IN ADVANCES
Each Bank will participate through its Facility Office in each Advance
made pursuant to this Clause 3 (Utilisation of the Facility) in the
proportion borne by its Available Commitment to the Available Facility
immediately prior to the making of that Advance.
3.3 REDUCTION OF AVAILABLE COMMITMENT
If a Bank's Commitment is reduced in accordance with the terms hereof
after the Agent has received the Notice of Drawdown for an Advance and
such reduction was not taken into account in the Available Facility,
then the amount of that Advance shall be reduced accordingly.
3.4 FORCED DRAWDOWN
At any time during the continuance of a Remedy Restriction Period, the
Agent, acting upon the instructions of an Instructing Group, shall have
the right to require the Borrower to incur an Advance in the amount
necessary to cause the Full Funding Date to occur (such amount the
"FORCED DRAWDOWN Amount"). Such right shall be exercised by the giving
of notice of such drawdown by the Agent to the Banks and the Borrower.
In such an event, upon notice to each Bank, such Bank shall fund its pro
rata portion of the Forced Drawdown Amount to the Agent and the Agent,
on behalf of the Borrower, will transfer the amounts so made available
to the Borrower's account at the Senior Agent. The Borrower and each of
the other Obligors acknowledge and agree that the making of an Advance
by the Banks pursuant to this Clause 3.4 (Forced Drawdown) has been
irrevocably and unconditionally consented to by the Borrower and the
Obligors and neither the Borrower nor any other Obligor nor any other
person shall have the right to revoke, cancel or otherwise limit such
consent or the right of the Banks to make such Advance hereunder.
36
38
4. PAYMENT AND CALCULATION OF INTEREST ON ADVANCES; INTEREST PERIODS
4.1 PAYMENT OF INTEREST
On the last day of each Interest Period (and, if the Interest Period of
such Advance exceeds six months, on the expiry of each period of six
months during such Interest Period) the Borrower shall pay accrued
interest on the Advance to which such Interest Period relates.
4.2 CALCULATION OF INTEREST
The rate of interest applicable to an Advance from time to time during
an Interest Period relating thereto shall be the rate per annum which is
the lesser of:
4.2.1 16 per cent. per annum; and
4.2.2 the sum of:
(a) the Margin at such time;
(b) the Mandatory Cost Rate; and
(c) LIBOR on the Quotation Date therefor.
4.3 LIMITATIONS ON CASH INTEREST.
Notwithstanding anything to the contrary set forth in this Agreement, to
the extent that the rate of interest applicable to an Advance on any
interest payment date for such Advance exceeds the sum of 14 per cent.
per annum and the increase, if any, in the rate of interest pursuant to
Clause 4.4 (Default Interest) such excess interest shall be paid by
adding such excess interest to the principal amount of such Advance
unless the Borrower shall have given the Agent notice at least three
Business Days prior to such interest payment date that it shall pay such
excess amount in cash.
4.4 DEFAULT INTEREST
The interest rate determined in accordance with Clause 4.2 (Calculation
of Interest) shall be increased by one per cent. per annum (it being
understood that the interest rate could by reason of such increase
exceed 16 per cent. per annum) from the date determined by the Agent
(acting reasonably) (in writing) as being the date on which an Event of
Default or Potential Event of Default has occurred or come into
existence until the date specified by the Agent (in writing) as being
the date on which it has been demonstrated to its satisfaction (acting
reasonably) that such Event of Default or Potential Event of Default is
no longer continuing. The Agent shall promptly notify the other parties
hereto of any determination that an Event of Default or Potential Event
of Default has occurred or exists or, as the case may be, that it has
been demonstrated to its reasonable satisfaction that such is no longer
continuing.
4.5 INTEREST PERIODS
The period for which an Advance is outstanding shall be divided into
successive periods each of which (other than the first, which shall
begin on the day such Advance is made) shall start on the last day of
the preceding such period.
4.6 DURATION
37
39
The duration of each Interest Period shall, save as otherwise provided
herein, be one, two, three or six months or such other period as the
Agent (acting on instructions of all the Banks) may agree in each case
as the Borrower may by not less than five Business Days' prior notice to
the Agent select, PROVIDED THAT:
4.6.1 if the Borrower fails to give such notice of its selection in
relation to an Interest Period, the duration of that Interest
Period shall, subject to sub-clauses 4.6.2, 4.6.3 and 4.6.4 be
one month;
4.6.2 if there are more than five Advances outstanding any Interest
Period which begins during or at the same time as anyone or more
other Interest Periods shall end at the same time as such one of
those other Interest Periods as the Borrower may, by not less
than five Business Days' prior notice to the Agent, select or,
failing such selection, the first such other Interest Period to
expire;
4.6.3 any Interest Period which would otherwise end during the month
preceding, or extend beyond, the Final Maturity Date shall be of
such duration that it shall end on the Final Maturity Date; and
4.6.4 prior to the Syndication Date, Interest Periods shall be one
month or such other period as the Agent and the Borrower may
agree.
4.7 CONSOLIDATION OF ADVANCES
If two or more Interest Periods end at the same time, then, on the last
day of those Interest Periods, the Advances to which they relate shall
be consolidated into and treated as a single Advance.
4.8 DIVISION OF ADVANCES
The Borrower may, by not less than five Business Days' prior notice to
the Agent, direct that any Advance shall, at the beginning of any
Interest Period relating thereto, be divided into (and thereafter, save
as otherwise provided herein, treated in all respects as) two or more
Advances in such amounts (in aggregate, equaling the amount of the
Advance being so divided) as shall be specified by the Borrower in such
notice, PROVIDED THAT the Borrower shall not be entitled to make such a
direction if:
4.8.1 as a result of so doing, there would be more than five
outstanding Advances; or
4.8.2 any Advance thereby coming into existence would be of an amount
less than L50,000,000.
5. MARKET DISRUPTION AND ALTERNATIVE INTEREST RATES
5.1 MARKET DISRUPTION
If, in relation to any Advance:
5.1.1 LIBOR is to be determined by reference to Reference Banks and at
or about 11.00 a.m. on the Quotation Date for the relevant
Interest Period none or only one of the Reference Banks supplies
a rate for the purpose of determining LIBOR for the relevant
Interest Period; or
38
40
5.1.2 before the close of business in London on the Quotation Date for
such Advance the Agent has been notified by a Bank or each of a
group of Banks, to whom in aggregate fifty per cent. or more of
such Advance would be owed if made that the LIBOR rate does not
accurately reflect the cost of funding its participation in such
Advance,
then the Agent shall notify the Borrower and the Banks of such event
and, notwithstanding anything to the contrary in this Agreement, Clause
5.2 (Substitute Interest Period and Interest Rate) shall apply to such
Advance (if it is a Rollover Advance). If either sub-clause 5.1.1 or
5.1.2 of Clause 5.1 (Market Disruption and Alternative Interest Rates)
applies to a proposed Advance (other than a Rollover Advance), such an
Advance shall not be made.
5.2 SUBSTITUTE INTEREST PERIOD AND INTEREST RATE
If sub-clause 5.1.1 of Clause 5.1 (Market Disruption and Alternative
Interest Rates) applies to an Advance, the duration of the relevant
Interest Period shall be one month or, if less, such that it shall end
on the Final Maturity Date. If either sub-clause 5.1.1 or 5.1.2 of
Clause 5.1 (Market Disruption and Alternative Interest Rates) applies to
an Advance, the rate of interest applicable to each Bank's portion of
such Advance during the relevant Interest Period shall (subject to any
agreement reached pursuant to Clause 5.3 (Alternative Rate)) be the rate
per annum which is the sum of:
5.2.1 the Margin at such time;
5.2.2 the Mandatory Cost Rate; and
5.2.3 the rate per annum notified to the Agent by such Bank before the
last day of such Interest Period to be that which expresses as a
percentage rate per annum the cost to such Bank of funding from
whatever sources it may reasonably select its portion of such
Advance during such Interest Period.
5.3 ALTERNATIVE RATE
If either of those events mentioned in sub-clauses 5.1.1 or 5.1.2 of
Clause 5.1 (Market Disruption and Alternative Interest Rates) occurs in
relation to an Advance, then if the Agent or the Borrower so requires,
the Agent and the Borrower shall enter into negotiations with a view to
agreeing a substitute basis (i) for determining the rates of interest
from time to time applicable to the Advances and/or (ii) upon which the
Advances may be maintained (whether in sterling or some other currency)
thereafter and any such substitute basis that is agreed shall take
effect in accordance with its terms and be binding on each party hereto,
PROVIDED THAT the Agent may not agree any such substitute basis without
the prior consent of each Bank (which is not to be unreasonably
withheld).
6. NOTIFICATION
6.1 ADVANCES
The Agent shall, promptly upon its receipt of a Notice of Drawdown,
notify each Bank of:
6.1.1 the proposed amount of the relevant Advance;
39
41
6.1.2 the proposed length of the relevant Interest Period; and
6.1.3 the aggregate principal amount of the relevant Advance allocated
to such Bank pursuant to Clause 3.2 (Each Bank's Participation
in Advances).
6.2 INTEREST PERIODS
Not less than three Business Days before the first day of an Interest
Period, the Agent shall notify each Bank of the proposed amount of the
relevant Advance, the proposed length of such Interest Period and the
aggregate principal amount of the relevant Advance allocated to such
Bank pursuant to Clause 3.2 (Each Bank's Participation in Advances).
6.3 INTEREST RATE DETERMINATION
The Agent shall promptly notify the Borrower and the Banks of each
determination of LIBOR, the Mandatory Cost Rate and the Margin.
6.4 CHANGES TO ADVANCES OR INTEREST RATES
The Agent shall promptly notify the Borrower and the Banks of any change
to (a) the proposed length of an Interest Period or (b) any interest
rate occasioned by the operation of Clause 5 (Market Disruption and
Alternative Interest Rates).
7. REPAYMENT AND REDUCTION OF THE FACILITY
7.1 REPAYMENT
The Borrower shall repay each Advance made to it in full on the Final
Maturity Date.
8. CANCELLATION AND PREPAYMENT
8.1 CANCELLATION OF THE FACILITY
Subject to the provisions of Clause 8.7 (Limitations on Cancellation of
the Facility), the Borrower may, by giving to the Agent not less than
five Business Days' prior written notice to that effect, cancel the
whole or any part (being a minimum amount of L50,000,000 and an integral
multiple of L10,000,000) of the Available Facility. Any such
cancellation shall reduce the Available Commitment and Commitment of
each Bank rateably.
8.2 PREPAYMENT OF THE FACILITY
Subject to the provisions of Clause 8.7 (Limitations on Cancellation of
the Facility) and Clause 23.4 (Break Costs), the Borrower may, by giving
to the Agent not less than five Business Days prior written notice to
that effect, prepay the whole or any part of an Advance (being a minimum
amount of L50,000,000 and an integral multiple of L10,000,000).
8.3 NOTICE OF CANCELLATION OR PREPAYMENT
Any notice of cancellation or prepayment given by the Borrower pursuant
to this Clause 8 (Cancellation and Prepayment) shall be irrevocable,
shall specify the date upon which such cancellation or prepayment is to
be made and the amount of such cancellation or prepayment and, in the
case of a notice of prepayment, shall oblige the Borrower to make such
prepayment on such date.
40
42
8.4 REPAYMENT OF A BANK'S SHARE OF THE LOAN
If:
8.4.1 any sum payable to any Bank by an Obligor is required to be
increased pursuant to Clause 10.1 (Tax Gross-up); or
8.4.2 any Bank claims indemnification from an Obligor under Clause
10.2 (Tax Indemnity), the Agent claims indemnification from an
Obligor under Clause 10.2 (Tax Indemnity) in respect of a
payment received by it and paid by it to a Bank under the
Finance Documents or any Bank claims indemnification from the
Borrower under Clause 12.1 (Increased Costs),
the Borrower may, whilst such circumstance continues, give the Agent at
least five Business Days prior written notice (which notice shall be
irrevocable) of its intention to procure the repayment of such Bank's
share of the Loan. On the last day of each then current Interest Period,
or at any other time subject to the provisions of Clause 23.4 (Break
Costs), the Borrower shall repay such Bank's portion of the Advance to
which such Interest Period relates.
8.5 NO FURTHER ADVANCES
A Bank for whose account a repayment is to be made under Clause 8.4
(Repayment of a Bank's Share of the Loan) shall not be obliged to
participate in the making of Advances on or after the date upon which
the Agent receives the Borrower's notice of its intention to procure the
repayment of such Bank's share of the Loan, and such Bank's Available
Commitment shall be reduced to zero.
8.6 NO OTHER REPAYMENTS
The Borrower shall not repay all or any part of the Loan except at the
times and in the manner expressly provided for in this Agreement and
shall not be entitled to reborrow any amount repaid.
8.7 LIMITATION ON CANCELLATION OF THE FACILITY
Notwithstanding anything to the contrary set forth in this Clause 8
(Cancellation and Prepayment) or Clause 8.2 (Prepayment of the
Facility), the Borrower may not voluntarily reduce the Available
Commitment pursuant to Clause 8.1 (Cancellation of the Facility) or
prepay all or any part of an Advance pursuant to Clause 8.2 (Prepayment
of the Facility) at any time that the Senior Bank Credit Agreement is in
effect, without the consent of the Senior Agent under the Senior Bank
Credit Facility, unless such reduction or prepayment is permitted under
Clause 19.35 (Working Capital Facility Amendments) of the Senior Bank
Credit Agreement as in effect on the Execution Date.
9. MANDATORY PREPAYMENT
9.1 MANDATORY PREPAYMENT FROM EXCESS CASH FLOW
The Borrower shall ensure that within ten Business Days of delivery of
the most recent financial statements of the UK Group pursuant to Clause
16.1 (Annual Statements), commencing with the financial statements
delivered in respect of the financial year to ending 31 December 2003,
the Excess Cash Flow Payment Amount for the financial year to which such
financial statements relate is applied in cancellation of the Available
Facility and/or repayment of the Loan in accordance with Clause 9.6
(Application of
41
43
Proceeds).
9.2 MANDATORY PREPAYMENT FROM ASSET DISPOSALS
The Borrower shall ensure that the net cash proceeds of any disposal
falling within paragraph (f)(A) of the definition of Permitted Disposals
of any asset by any member of the UK Group are applied in cancellation
of the Available Facility and/or repayment of the Loan in accordance
with Clause 9.6 (Application of Proceeds) unless the relevant member of
the UK Group can show to the satisfaction of the Agent that:
9.2.1 such disposal was on arms' length terms and the net proceeds are
to be reinvested in similar or like assets of a comparable or
superior quality or applied towards the UK Group's Capital
Expenditure within a period of 365 days from the date of receipt
of such proceeds by the relevant member of the UK Group; or
9.2.2 such disposal was on arms' length terms and in the ordinary and
usual course of business of such member of the UK Group; or
9.2.3 the net disposal proceeds, when aggregated with the net disposal
proceeds received by members of the UK Group in respect of
disposals falling within paragraph (f)(A) of the definition of
Permitted Disposals made in the immediately preceding twelve
calendar month period (excluding the proceeds from disposals
falling within sub-clauses 9.2.1 or 9.2.2 above) does not exceed
L10,000,000 or its equivalent; or
9.2.4 the net disposal proceeds are required to be, and are actually,
applied to the permanent repayments and commitment reductions
under the Senior Bank Credit Agreement (but only to the extent
that such net disposal proceeds are actually so applied).
In the case of sub-clause 9.2.1 only, to the extent that the net
disposal proceeds therefrom are not deposited in the prepayment
escrow account established under the Senior Bank Credit
Agreement, the net disposal proceeds referred to therein will be
deposited in the Prepayment Escrow Account and the relevant
member of UK Group shall be entitled, during the 365 day period,
to withdraw (or, as the case may be, require the Borrower to
withdraw) sums from such account only to the extent that it is
able to reasonably demonstrate that such sums will be reinvested
or applied in accordance with the provisions of sub-clause
9.2.1. Any amounts not reinvested as specified in sub-clause
9.2.1 during the 365 day period specified therein shall
thereafter, be applied in repayment of the Loan in accordance
with Clause 9.6 (Application of Proceeds), provided that to the
extent that any amounts are deposited in the Prepayment Escrow
Account prior to the Pushdown Date, such amounts shall not be so
applied on such 365th day but shall be retained in the
Prepayment Escrow Account until the earlier of (x) the later of
the Pushdown Date and such 365th day (on which later date such
amounts shall be applied to the permanent repayment of amounts
outstanding under the Senior Bank Credit Agreement in accordance
with clause 10.2.1 thereof) and (y) the occurrence of an Event
of Default (in which event such amounts shall be applied in
repayment of the Loan in accordance with Clause 9.6 (Application
of Proceeds)).
42
44
9.3 MANDATORY PREPAYMENT FROM INSURANCE PROCEEDS
The Borrower shall ensure that Insurance Proceeds received by any member
of the UK Group above an aggregate minimum threshold of Insurance
Proceeds of L10,000,000 (the "MINIMUM THRESHOLD"), are paid to the Agent
and applied in cancellation of the Available Facility and/or repayment
of the Loan in accordance with Clause 9.6 (Application of Proceeds)
unless the Insurance Proceeds received above the Minimum Threshold are:
9.3.1 promptly upon receipt, deposited in the Prepayment Escrow
Account in accordance with the provisions of Clause 9.4 (Payment
of Insurance Proceeds into Prepayment Escrow Account); and
9.3.2 applied, to the satisfaction of the Agent, towards the
replacement, reinstatement and/or repair of the assets and/or
the satisfaction of business interruption losses in respect of
which the relevant insurance claim was made (or to refinance any
expenditure incurred in the replacement, reinstatement and/or
repair of such assets) within a period of 365 days from the date
of receipt of such Insurance Proceeds by the relevant member of
the UK Group; or
9.3.3 are required to be, and are actually, applied to the permanent
repayment and commitment reductions under the Senior Bank Credit
Agreement (but only to the extent that such Insurance Proceeds
are actually so applied).
9.4 PAYMENT OF INSURANCE PROCEEDS INTO PREPAYMENT ESCROW ACCOUNT
The Borrower shall ensure that to the extent that any Insurance Proceeds
to be applied in accordance with sub-clause 9.3.2 of Clause 9.3
(Mandatory Prepayment from Insurance Proceeds) are not deposited in the
prepayment escrow account established under the Senior Bank Credit
Agreement such Insurance Proceeds are deposited in the Prepayment Escrow
Account. The relevant member of the UK Group shall be entitled, during
the period of 365 days from its receipt of Insurance Proceeds, to
withdraw sums from the Prepayment Escrow Account only to the extent that
it is able to reasonably demonstrate that such sums will be applied
towards the replacement, reinstatement and/or repair of the assets
and/or the satisfaction of business interruption losses in respect of
which the relevant insurance claim was made (or to refinance any
expenditure incurred in the replacement, reinstatement and/or repair of
such assets). Any sums not so withdrawn during such 365 day period shall
thereafter be paid to the Agent and applied in cancellation of the
Available Facility and/or repayment of the Loan in accordance with
Clause 9.6 (Application of Proceeds), provided that to the extent that
any amounts are deposited in the Prepayment Escrow Account prior to the
Pushdown Date, such amounts shall not be so applied on such 365th day
but shall be retained in the Prepayment Escrow Account until the earlier
of (x) the later of the Pushdown Date and such 365th day (on which later
date such amounts shall be applied to the permanent repayment of amounts
outstanding under the Senior Bank Credit Agreement in accordance with
clause 10.2.1 thereof) and (y) the occurrence of an Event of Default (in
which event such amounts shall be applied in repayment of the Loan in
accordance with Clause 9.6 (Application of Proceeds)).
43
45
9.5 MANDATORY PREPAYMENT FROM CAPITAL EVENT PROCEEDS
The Parent shall ensure that upon the receipt of Capital Event Proceeds
an amount equal to the Capital Event Proceeds Amount as then determined
is applied in cancellation of the Available Facility and/or repayment of
the Loan in accordance with Clause 9.6 (Application of Proceeds),
PROVIDED that there shall be no obligation to apply any such Capital
Event Proceeds which are otherwise required to be so applied until the
amount of Capital Event Proceeds which have not been applied by reason
of this proviso exceed L5,000,000 (in which case the entire amount (and
not simply the amount in excess of L5,000,000) shall be so applied).
9.6 APPLICATION OF PROCEEDS
9.6.1 Any amounts required to be applied in cancellation of the
Available Facility and/or repayment of the Loan pursuant to
Clause 9.1 (Mandatory Prepayment From Excess Cash Flow) to
Clause 9.5 (Mandatory Prepayments from Capital Event Proceeds)
shall be applied as follows:
(a) all such amounts required to be applied pursuant to
Clause 9.5 (Mandatory Prepayment from Capital Event
Proceeds) other than to the extent arising from the
Incremental Amount shall be applied (x) first to the
repayment of Loan then outstanding and (y) second to the
extent any proceeds remain after application pursuant to
clause (x), to the reduction of the Available Facility;
(b) all such amounts not covered by clause (a) above, shall
be applied (x) first, to the reduction of the Available
Facility and (y) second, to the extent any proceeds
remain after application pursuant to clause (x) (i.e.
after the Available Facility has been reduced to zero),
to the repayment of Loans then outstanding.
9.6.2 Any amounts paid to the Agent in accordance with Clause 9.1
(Mandatory Prepayment from Excess Cash Flow) to Clause 9.5
(Mandatory Prepayment from Capital Event Proceeds) shall be:
(a) retained in the Prepayment Escrow Account pending any
withdrawal permitted by any of those Clauses; and
(b) if no such right of withdrawal is available, if it has
ceased to be available or if the Borrower so instructs
the Agent, be retained in the Prepayment Escrow Account
for application on one or more prepayment dates until
such time as such amounts have been applied in full in
repayment of the Loan in accordance with this Clause
9.6.
9.7 MANDATORY PREPAYMENT DUE TO CHANGE IN CONTROL
9.7.1 If after the date hereof:
(a) any person, or group of connected persons, (which does not have
control at the date hereof) acquires control of NTL Holdings;
(b) the Parent or any Obligor ceases to be (directly or indirectly)
a wholly-owned subsidiary of NTL Holdings; or
44
46
(c) the Borrower ceases to be (directly or indirectly) a
wholly-owned subsidiary of the Parent;
then the Borrower shall procure the immediate repayment of the Loan in
full (together with accrued interest thereon and any other sums then
owed by the Borrower hereunder) and the Available Commitment of each
Bank shall be immediately cancelled and reduced to zero.
9.7.2 For the purpose of this Clause 9.7 (Mandatory Prepayment due to
Change in Control):
"CONTROL" means:
(a) the power (whether by way of ownership of shares, proxy,
contract, agency or otherwise) to:
(i) cast, or control the casting of, more than
one-half of the maximum number of votes that
might be cast at a general meeting of NTL
Holdings; or
(ii) appoint or remove all, or the majority, of the
directors or other equivalent officers of NTL
Holdings; or
(iii) give directions with respect to the operating
and financial policies of NTL Holdings which the
directors or other equivalent officers of NTL
Holdings are obliged to comply with; or
(b) the holding of more than one-half of the issued share
capital of NTL Holdings (excluding any part of that
issued share capital that carries no voting rights or
right).
"GROUP OF CONNECTED PERSONS" means, a group of persons who,
pursuant to an agreement or understanding (whether formal or
informal), actively co-operate, through the acquisition by any
of them, either directly or indirectly, of shares in NTL
Holdings, to obtain or consolidate control of NTL Holdings.
9.7.3 This Clause 9.7 (Mandatory Prepayment due to Change in Control)
will not apply, and the Available Commitments will not be
cancelled, and the Loan will not become due and payable in the
event that:
(a) France Telecom S.A. or any of its affiliates acquires
control of NTL Holdings; or
(b) any company acquires control of NTL Holdings as part of
a solvent reorganisation of the Group on terms approved
by the Agent (acting on the instructions of an
Instructing Group).
9.8 MANDATORY PREPAYMENT DUE TO PUSHDOWN DATE
Notwithstanding any other provision of this Agreement, if the Pushdown
Date has not occurred on or prior to 30 September 2001, on the first
Business Day after 30 September 2001, the Borrower shall procure the
immediate repayment of the Loan in full (together with accrued interest
thereon and any other sum owed by the Borrower hereunder) and
45
47
Available Commitment of each Bank shall immediately be cancelled and
reduced to zero.
10. TAXES
10.1 TAX GROSS-UP
All payments to be made by an Obligor to any Finance Party under the
Finance Documents shall be made free and clear of and without deduction
for or on account of tax unless such Obligor is required by law to make
such a payment subject to the deduction or withholding of tax, in which
case the sum payable by such Obligor (in respect of which such deduction
or withholding is required to be made) shall, subject to Clause 10.6
(Excluded Claims), be increased to the extent necessary to ensure that
such Finance Party receives a sum net of any deduction or withholding
equal to the sum which it would have received had no such deduction or
withholding been made or required to be made.
10.2 TAX INDEMNITY
Without prejudice to Clause 10.1 (Tax Gross-up), if the Agent or (as a
result of the introduction of, or change in or in the interpretation,
administration or application of, any law or regulation or order or
governmental rule or double taxation agreement or any published practice
or concession of any relevant taxing authority after the date hereof)
any Bank (a) is required to make any payment of or on account of tax on
or in relation to any sum received or receivable under the Finance
Documents (including any sum deemed for purposes of tax to be received
or receivable by such Finance Party whether or not actually received or
receivable) or (b) has any liability in respect of any such payment
asserted, imposed, levied or assessed against it, the relevant Obligor
shall, within five Business Days of demand by the Agent, promptly
indemnify the Agent or Bank which suffers a loss or liability as a
result against such payment or liability, together with any interest,
penalties, costs and expenses payable or incurred in connection
therewith, PROVIDED THAT this Clause 10.2 shall not apply to:
10.2.1 any tax imposed on and calculated by reference to the net
income, profits or gains actually received or receivable by the
Agent or such Bank (but, for the avoidance of doubt, not
including any sum deemed for purposes of tax to be received or
receivable by the Agent or such Bank but not actually
receivable) by the jurisdiction in which the Agent or such Bank
is incorporated or, if different, the jurisdiction (or
jurisdictions) in which the Agent or such Bank is treated as
resident for tax purposes (but excluding any such tax that would
not have arisen but for such Agent or Bank, as the case may be,
being treated as a resident in a jurisdiction solely by reason
of having entered into this Agreement, performed its obligations
or received any payment hereunder or enforced its rights
hereunder); or
10.2.2 any tax imposed on and calculated by reference to the net
income, profits or gains of the Facility Office of the Agent or
such Bank actually received or receivable by the Agent or such
Bank (but, for the avoidance of doubt, not including any sum
deemed for purposes of tax to be received or receivable by the
Agent or such Bank but not actually receivable) by the
jurisdiction in which its Facility Office is located; or
46
48
10.2.3 any tax imposed on the Agent, as a result of the failure by a
Bank to satisfy on the due date of a payment of interest either
of the conditions set out in sub-clauses 10.3.1 and 10.3.2 of
Clause 10.3 (Banks' Tax Status Confirmation); or
10.2.4 for the avoidance of doubt, any tax imposed on a Bank which
would not have arisen but for the sub-participation of its
rights and benefits under any of the Finance Documents.
10.3 BANKS' TAX STATUS CONFIRMATION
Each Bank confirms in favour of the Agent (on the date hereof or, in the
case of a Bank which becomes a party hereto pursuant to a transfer or
assignment, on the date on which the relevant transfer or assignment
becomes effective) that either:
10.3.1 it is not resident for tax purposes in the United Kingdom and is
beneficially entitled to its share of the Loan and the interest
thereon; or
10.3.2 it is a bank as defined for the purposes of Section 349 of ICTA
and is beneficially entitled to its share of the Loan and the
interest thereon,
and each Bank shall promptly notify the Agent if there is any change in
its position from that set out above.
10.4 U.S. TAX FORMS
Each Bank that is not a United States person (as such term is defined in
Section 7701(a)(30) of the Internal Revenue Code) for U.S. federal
income tax purposes agrees to deliver to the Borrower and the Agent on
or prior to the Initial Advance Date, or in the case of a Bank that is
an assignee or transferee of an interest under this Agreement pursuant
to Clause 30.3 (Assignment and Transfers by Banks) (unless the
respective Bank was already a Bank hereunder immediately prior to such
assignment or transfer), on the date of such assignment or transfer to
such Bank, (i) two accurate and complete original signed copies of
Internal Revenue Service Form W-8ECI or Form W-8BEN (with respect to a
complete exemption under an income tax treaty) (or successor forms)
certifying to such Bank's entitlement as of such date to a complete
exemption from United States withholding tax with respect to payments to
be made under this Agreement, or (ii) if the Bank is not a "bank" within
the meaning of Section 881(c)(3)(A) of the Code and cannot deliver
either Internal Revenue Service Form W-8ECI or Form W-8BEN (with respect
to a complete exemption under an income tax treaty) pursuant to clause
(i) above, (x) a certificate substantially in the form of Schedule 8
(any such certificate, a "NON-BANK CERTIFICATE") and (y) two accurate
and complete original signed copies of Internal Revenue Service Form
W-8BEN (with respect to the portfolio interest exemption) (or successor
form) certifying to such Bank's entitlement to a complete exemption from
United States withholding tax with respect to payments of interest to be
made under this Agreement. In addition, each Bank agrees that from time
to time after the Initial Advance Date, upon the reasonable request of
the Borrower or when a change in circumstances of the Bank renders the
previous certification obsolete or inaccurate in any material respect,
it will deliver to the Borrower and the Agent two new accurate and
complete original signed copies of Internal Revenue Service W-8ECI or
Form W-8BEN (with respect to the benefits of any income tax treaty), or
Form W-8BEN (with respect to the portfolio interest exemption) and a
Non-Bank Certificate, as
47
49
the case may be, and such other forms as may be required in order to
confirm or establish the entitlement as of such date of such Bank to a
continued exemption from or (as a result of a change in law, treaty,
rule, regulations, guideline or order, or in the interpretation thereof)
reduction in United States withholding tax with respect to payments
under this Agreement, or it shall notify the Borrower and the Agent of
its inability to deliver any such Form or Certificate, in which case
such Bank shall not be required to deliver any such Form or Certificate
pursuant to this Clause 10.4. Notwithstanding anything to the contrary
contained in Clause 10.1 (Tax Gross-up), but subject to Clause 10.5
(Claims by Banks and the Agent) and the immediately succeeding sentence,
(x) the Borrower shall be entitled, to the extent it is required to do
so by law, to deduct or withhold income or similar taxes imposed by the
United States (or any political subdivision or taxing authority thereof
or therein) from interest, fees or other amounts payable hereunder for
the account of any Bank which is not a United States person (as such
term is defined in Section 7701(a)(30) of the Code) for U.S. federal
income tax purposes to the extent that such Bank has not provided to the
Borrower U.S. Internal Revenue Service Forms that establish a complete
exemption from such deduction or withholding and (y) the Borrower shall
not be obligated pursuant to Clause 10.1 to gross-up payments to be made
to a Bank in respect of income or similar taxes imposed by the United
States if (I) such Bank has not provided to the Borrower the Internal
Revenue Service Forms required to be provided to the Borrower pursuant
to this Clause 10.4 or (II) in the case of a payment, other than
interest that is treated as interest for U.S. federal income tax
purposes, to a Bank described in clause (ii) above, to the extent that
such Forms do not establish a complete exemption from withholding of
such taxes. Notwithstanding anything to the contrary contained in the
preceding sentence or elsewhere in this Clause 10.4 and except as set
forth in Clause 10.5 (Claims by Banks and the Agent), the Borrower
agrees to pay any additional amounts and to indemnify each Bank in the
manner set forth in Clause 10.1 (Tax Gross-up) in respect of any United
States taxes deducted or withheld by it as described in the immediately
preceding sentence as a result of any changes that are effective after
the Initial Advance Date in any applicable law, treaty, governmental
rule, regulation, guideline or order, or in the interpretation thereof,
relating to the deducting or withholding of such taxes.
10.5 CLAIMS BY BANKS AND THE AGENT
A Bank intending to make a claim pursuant to Clause 10.2 (Tax Indemnity)
shall notify the Agent of the event giving rise to the claim, whereupon
the Agent shall notify the Borrower thereof. If the Agent intends to
make a claim pursuant to Clause 10.2 (Tax Indemnity) it shall notify the
Borrower of the event giving rise to the claim.
10.6 EXCLUDED CLAIMS
If any Finance Party is not or ceases to be a Qualifying Lender, no
Obligor shall be liable to pay to that Finance Party under Clause 10.1
(Tax Gross-Up) any amount in respect of taxes levied or imposed by the
United Kingdom in excess of the amount it would have been obliged to pay
if that Finance Party had been or had not ceased to be a Qualifying
Lender PROVIDED THAT this Clause 10.6 shall not apply (and each Obligor
shall be obliged to comply with its obligations under Clause 10.1 (Tax
Gross-Up)) if:
10.6.1 after the date hereof, there shall have been any introduction
of, or change in or in the interpretation, administration or
application of, any law or regulation or order or governmental
rule or double taxation agreement or any published
48
50
practice or concession of any relevant taxing authority and as a
result thereof such Finance Party ceases to be a Qualifying
Lender; or
10.6.2 such Finance Party is not or ceases to be a Qualifying Lender
as a result of the actions of any Obligor.
10.7 TREATY LENDERS
A Treaty Lender and each Obligor which makes a payment to which that
Treaty Lender is entitled shall co-operate in completing any procedural
formalities necessary for that Obligor to obtain authorisation to make
that payment without a deduction or withholding for or on account of tax
imposed by the United Kingdom. If an Obligor is able to demonstrate that
a deduction or withholding for or on account of tax imposed by the
United Kingdom is required to be made by it as a result of a Treaty
Lender's failure to so co-operate, such an Obligor shall not be liable
to pay any increased amount under Clause 10.1 (Tax Gross-Up) as a result
of such a deduction or withholding.
10.8 NOTIFICATION OF STATUS
Each Bank shall notify the Agent if it is not a Qualifying Lender at the
time it becomes a Bank hereunder and shall promptly notify the Agent if
at any time thereafter it ceases to be a Qualifying Lender. The Agent
shall promptly notify the Borrower of any notices it receives under this
Clause 10.8 and if it ceases to be a Qualifying Lender.
11. TAX RECEIPTS
11.1 NOTIFICATION OF REQUIREMENT TO DEDUCT TAX
If, at any time, an Obligor is required by law to make any deduction or
withholding from any sum payable by it under the Finance Documents (or
if thereafter there is any change in the rates at which or the manner in
which such deductions or withholdings are calculated), such Obligor and
the Bank to which such sum is payable shall promptly upon becoming aware
of such a requirement notify the Agent accordingly. If the Agent
receives such a notification from a Bank it shall promptly notify the
Borrower and the Obligor who is required to make such a deduction or
withholding.
11.2 EVIDENCE OF PAYMENT OF TAX
If an Obligor makes any payment under the Finance Documents in respect
of which it is required to make any deduction or withholding, it shall
pay the full amount required to be deducted or withheld to the relevant
taxation or other authority within the time allowed for such payment
under applicable law and shall request and, within thirty days of it
receiving the same, deliver to the Agent for each Bank an original
receipt (or a certified copy thereof) issued by such authority
evidencing the payment to such authority of all amounts so required to
be deducted or withheld in respect of that Bank's share of such payment.
11.3 TAX CREDIT PAYMENT
If an additional payment is made under Clause 10 (Taxes) by an Obligor
or the Borrower for the benefit of any Finance Party and such Finance
Party, in its sole discretion, determines that it has obtained (and has
derived full use and benefit from) a credit against, a relief or
remission for, or repayment of, any tax, then, if and to the extent that
such Finance Party, in its sole opinion, determines that such credit,
relief, remission or repayment is in respect of or calculated with
reference to or otherwise relates to the
49
51
additional payment made pursuant to Clause 10 (Taxes), such Finance
Party shall, to the extent that it can do so without prejudice to the
retention of the amount of such credit, relief, remission or repayment,
pay to such Obligor or, as the case may be, the Borrower such amount as
such Finance Party shall, in its sole opinion, determine to be the
amount which will leave such Finance Party (after such payment) in no
worse after-tax position than it would have been in had the additional
payment in question not been required to be made by such Obligor or the
Borrower.
11.4 TAX CREDIT CLAWBACK
If any Finance Party makes any payment to an Obligor or the Borrower
pursuant to Clause 11.3 (Tax Credit Payment) and such Finance Party
subsequently determines, in its sole opinion, that the credit, relief,
remission or repayment in respect of which such payment was made was not
available or has been withdrawn or that it was unable to use such
credit, relief, remission or repayment in full, such Obligor or the
Borrower shall reimburse such Finance Party such amount as such Finance
Party determines, in its sole opinion, is necessary to place it in the
same after-tax position as it would have been in if such credit, relief,
remission or repayment had been obtained and fully used and retained by
such Finance Party.
11.5 TAX AND OTHER AFFAIRS
Subject to Clause 10.7, no provision of this Agreement shall interfere
with the right of any Finance Party to arrange its tax or any other
affairs in whatever manner it thinks fit, oblige any Finance Party to
claim any credit, relief, remission or repayment in respect of any
payment under Clause 10 (Taxes) in priority to any other credit, relief,
remission or repayment available to it nor oblige any Finance Party to
disclose any information relating to its tax or other affairs or any
computations in respect thereof.
12. INCREASED COSTS
12.1 INCREASED COSTS
If, by reason of the occurrence, in each case after the date hereof, of
(a) any change in law or in its interpretation or administration and/or
(b) compliance with any such new law or with any request or requirement
relating to the maintenance of capital or any other request from or
requirement of any central bank or other fiscal, monetary or other
authority (in each case, where a request or requirement that does not
have the force of law is a request or requirement with which financial
institutions subject to such request or requirement are generally
accustomed to comply):
12.1.1 a Bank or any holding company of such Bank is unable to obtain
the rate of return on its capital which it would have been able
to obtain but for such Bank's entering into or assuming or
maintaining a commitment or performing its obligations under the
Finance Documents;
12.1.2 a Bank or any holding company of such Bank incurs a cost as a
result of such Bank's entering into or assuming or maintaining a
commitment or performing its obligations under the Finance
Documents; or
12.1.3 there is any increase in the cost to a Bank or any holding
company of such Bank of funding or maintaining such Bank's share
of the Advances or any Unpaid Sum,
50
52
then the Borrower shall, within three Business Days of a demand of the
Agent, pay to the Agent for the account of that Bank amounts sufficient
to indemnify that Bank or to enable that Bank to indemnify its holding
company from and against, as the case may be, (i) such reduction in the
rate of return of capital, (ii) such cost or (iii) such increased cost.
12.2 INCREASED COSTS CLAIMS
A Bank intending to make a claim pursuant to Clause 12.1 (Increased
Costs) shall notify the Agent of the event giving rise to such claim,
whereupon the Agent shall notify the Borrower thereof.
12.3 EXCLUSIONS
Notwithstanding the foregoing provisions of this Clause 12 (Increased
Costs), no Bank shall be entitled to make any claim under this Clause 12
(Increased Costs) in respect of any reduction in the rate of return on
capital, cost or increased cost:
12.3.1 attributable to a deduction or withholding for or on account of
tax from a payment under a Finance Document required by law to
be made by an Obligor and compensated for pursuant to the
provisions of Clause 10.1 (Tax Gross-Up) (or would have been
compensated for under Clause 10.1 (Tax Gross-Up) but was not so
compensated solely because of Clause 10.4 (Tax Forms), Clause
10.6 (Excluded Claims) or Clause 10.7 (Treaty Lenders));
12.3.2 compensated by Clause 10.2 (Tax Indemnity) (or would have been
compensated for under Clause 10.2 (Tax Indemnity) but was not so
compensated solely because of one of the exclusions set out in
sub-clauses 10.2.1 to 10.2.4 of Clause 10.2 (Tax Indemnity));
12.3.3 compensated by the Mandatory Cost Rate; or
12.3.4 attributable to the wilful breach by the relevant Finance Party
or its affiliates of any law or regulation.
13. ILLEGALITY
If, at any time, it is or will become unlawful for a Bank to make, fund
or allow to remain outstanding all or part of its share of the Advances,
then that Bank shall, promptly after becoming aware of the same, deliver
to the Borrower through the Agent a notice to that effect and:
13.1.1 such Bank shall not thereafter be obliged to participate in the
making of any Advances and the amount of its Available
Commitment (if any) shall be immediately reduced to zero; and
13.1.2 if the Agent on behalf of such Bank so requires, the Borrower
shall no later than the last day permitted by law repay such
Bank's share of any outstanding Advances together with accrued
interest thereon and all other amounts owing to such Bank under
the Finance Documents.
51
53
14. MITIGATION
If, in respect of any Bank, circumstances arise which would or would
upon the giving of notice result in:
14.1.1 an increase in any sum payable to it or for its account pursuant
to Clause 10.1 (Tax Gross-up);
14.1.2 a claim for indemnification pursuant to Clause 10.2 (Tax
Indemnity) or Clause 12.1 (Increased Costs); or
14.1.3 the reduction of its Available Commitment to zero or any
repayment to be made pursuant to Clause 13 (Illegality),
then, without in any way limiting, reducing or otherwise qualifying the
rights of such Bank or the obligations of the Obligors under any of the
Clauses referred to above, such Bank shall promptly upon becoming aware
of such circumstances notify the Agent thereof and, in consultation with
the Agent and the Borrower and to the extent that it can do so lawfully,
take reasonable steps (including a change of location of its Facility
Office or the transfer of its rights, benefits and obligations under the
Finance Documents to another financial institution acceptable to the
Borrower and willing to participate in the Facility) to mitigate the
effects of such circumstances, PROVIDED THAT such Bank shall be under no
obligation to take any such action if, in the opinion of such Bank, to
do so might have any adverse effect upon its business, operations or
financial condition (other than any minor costs and expenses of an
administrative nature).
15. REPRESENTATIONS
15.1.1 Each Covenant Group Obligor makes the representations and
warranties set out in Clause 15.2 (Status and Due Authorisation)
to Clause 15.29 (The Scheme); provided that insofar as the
representations and warranties set out in sub-clause 15.15.3 of
Clause 15.15 (Business Plan and Information Memorandum) and
Clause 15.27 (Group Structure) relate to the Target Group, the
Borrower makes such representations and warranties to the best
of its knowledge and belief and without liability to pay damages
for breach thereof.
15.1.2 The Parent makes the representations and warranties set out in
Clauses 15.2 (Status and Due Authorisation) to Clause 15.8 (No
Winding-Up), Clause 15.21 (Execution of this Agreement) and
Clause 15.26 (Security Interest) with respect to itself (as
applicable).
Each Obligor acknowledges that the Finance Parties have entered into the
Finance Documents in reliance on those representations and warranties.
15.2 STATUS AND DUE AUTHORISATION
It is duly organised under the laws of the jurisdiction in which it is
established or incorporated with power to enter into each of the Finance
Documents to which it is a party and to exercise its rights and perform
its obligations thereunder and all corporate and other action required
to authorise its execution of each of the Finance Documents to which it
is a party and its performance of its obligations thereunder has been
duly taken. No limit on its powers will be exceeded as a result of the
borrowings, granting of
52
54
security or giving of guarantees contemplated by the Finance Documents
to which it is a party.
15.3 NO DEDUCTIONS OR WITHHOLDING; ENTITY CLASSIFICATION ELECTION
Under the laws of its jurisdiction in which it is established or
incorporated in force at the date hereof, it will not be required to
make any deduction or withholding from any payment it may make under any
Finance Document to any Bank which is a Qualifying Lender (assuming in
the case of a Treaty Lender, that it has secured a direction from the UK
Inland Revenue to pay interest gross and assuming in the case of United
States taxes that the tax forms required to be provided in Clause 10.4
(U.S. Tax Forms) have been so provided). The Borrower has filed a valid
election to be treated as a disregarded entity for U.S. federal income
tax purposes and such election currently remains in effect.
15.4 NO IMMUNITY
In any proceedings taken in the jurisdiction in which it is incorporated
or established in relation to any Finance Document to which it is party,
it is not entitled to claim for itself or any of its assets immunity
from suit, execution, attachment or other legal process.
15.5 VALIDITY AND ADMISSIBILITY IN EVIDENCE
All acts, conditions and things required to be done, fulfilled and
performed in order:
15.5.1 to enable it lawfully to enter into, exercise its rights under
and perform and comply with the obligations expressed to be
assumed by it in each of the Finance Documents to which it is
party;
15.5.2 to ensure that the obligations expressed to be assumed by it in
each such Finance Document are legal, valid and (subject to the
Reservations) binding and enforceable; and
15.5.3 (subject to the Reservations) to make each such Finance Document
admissible in evidence in England and the United States,
have been done, fulfilled and performed (other than the registration of
the Encumbrances created by the Security Documents with the Registrar of
Companies under Sections 395 and 398 of the Companies Act 1985).
15.6 NO FILING OR STAMP TAXES
Under the laws of the jurisdiction in which it is incorporated or
established in force at the date hereof, it is not necessary that any of
the Finance Documents to which it is a party be filed, recorded or
enrolled with any court or other authority in such jurisdiction or that
any stamp, registration or similar tax be paid on or in relation to any
Finance Document other than the entries in public registries referred to
in Clause 15.5 (Validity and Admissibility in Evidence) and fixed duties
on assignments by way of security.
15.7 BINDING OBLIGATIONS
The obligations expressed to be assumed by it in each Finance Document
to which it is expressed to be a party are legal and valid obligations
and (subject to the Reservations) binding on it and enforceable against
it in accordance with the terms thereof.
53
55
15.8 NO WINDING-UP
No Obligor nor member of the UK Group has taken any corporate action nor
have any other steps been taken or legal proceedings been started and
served or (to the best of its knowledge and belief) threatened against
any Obligor or any member of the UK Group for its winding-up,
dissolution, administration or re-organisation or for the appointment of
a receiver, administrator, administrative receiver, trustee or similar
officer of it or of any or all of its assets or revenues (other than for
the purpose of a solvent reconstruction or amalgamation of such Obligor
or (as the case may be) such member of the UK Group (where such would
not cause any breach of this Agreement) or for the purpose of the
transfer of all or part of the business and assets of any member of the
UK Group to any other member of the UK Group (PROVIDED THAT such
transfer is permitted under the terms of this Agreement)) and (save in
the case of any action, steps or proceedings relating to the appointment
of an administrator) other than where the relevant action, steps or
proceedings are frivolous or vexatious or being contested in good faith
by appropriate legal action and such action, steps or proceedings are
discontinued (in any such case) within 30 days of commencement.
15.9 NO MATERIAL DEFAULTS
No member of the Covenant Group is in breach of or in default under any
agreement to which it is a party (including, without limitation,
Material Commercial Contracts) or which is binding on it or any of its
assets and no party has terminated or is entitled to terminate (on the
basis of any breach of or default thereunder) any such agreement to an
extent or in a manner which could reasonably be expected to have a
Material Adverse Effect.
15.10 NO MATERIAL PROCEEDINGS
No action or administrative proceeding of or before any court,
arbitrator or agency (including, without limitation, investigative
proceedings) which could reasonably be expected to have a Material
Adverse Effect has been started or threatened against any member of the
Covenant Group or any of their respective assets.
15.11 AUDITED FINANCIAL STATEMENTS
Its most recent consolidated audited financial statements:
15.11.1 were prepared in accordance with accounting principles generally
accepted in its jurisdiction of incorporation and consistently
applied;
15.11.2 disclose all material liabilities (contingent or otherwise) and
all material unrealised or anticipated losses any member of the
Covenant Group; and
15.11.3 save as disclosed therein, give a true and fair view of the
financial condition and operations of the Intermediate Parent
or, as the case may be, the UK Group during the relevant
financial year.
15.12 ORIGINAL FINANCIAL STATEMENTS
Save as disclosed in the Disclosure Letter, the financial statements of
the Target (referred to in paragraph (c) of the definition of Original
Financial Statements), to the best of its knowledge and belief:
54
56
15.12.1 were prepared in accordance with accounting principles generally
accepted in England and Wales and consistently applied;
15.12.2 disclose all material liabilities (contingent or otherwise) and
all material unrealised or anticipated losses of the Target and
the CWC ConsumerCo Business; and
15.12.3 save as disclosed therein, give a true and fair view of the
financial condition and operations of the Target and the CWC
ConsumerCo Business during the period to which such financial
statements relate.
15.13 NO MATERIAL ADVERSE CHANGE
Since the date as at which its most recent audited financial statements
(where required by Clause 16.1 (Annual Statements), consolidated, in the
case of the Borrower) were stated to be prepared, there has been no
change in its business or financial condition or, in the business or
financial condition of any member of the UK Group or of the UK Group
taken as a whole or, in the business or financial condition of any
member of the Target Group or of the Target Group taken as a whole
which, in each case, could reasonably be expected to have a Material
Adverse Effect.
15.14 FULL DISCLOSURE
It is not aware of any material facts or circumstances that have not
been disclosed to the Finance Parties originally party hereto and which
would, in its reasonable opinion, if disclosed, adversely affect the
decision of a person considering whether or not to provide finance for
the purposes set out in Clause 2.2 (Purpose) on the terms of the Finance
Documents.
15.15 BUSINESS PLAN AND INFORMATION MEMORANDUM
The Borrower:
15.15.1 does not regard any of the forecasts or projections set out in
the Business Plan as unreasonable or, to any material extent,
unattainable;
15.15.2 considers (having made all reasonable enquiries) the assumptions
upon which the forecasts and projections contained in the
Business Plan are based to be fair and reasonable in all
material respects; and
15.15.3 confirms that the factual information contained in the
Information Memorandum and any other written factual information
supplied by any member of the UK Group or any member of the
Target Group (in the latter case, supplied after the Acquisition
Date or, if supplied before the Acquisition Date, supplied with
the Borrower's knowledge) to the Agent, the Arrangers and the
Banks in connection herewith is true, complete and accurate in
all material respects.
15.16 BUDGETS
It:
15.16.1 regards (as at the date each Budget is delivered to the Agent)
as neither unreasonable, nor to any material extent
unattainable, any of the forecasts or projections set out in the
latest Budget delivered under Clause 16.5 (Budgets);
55
57
15.16.2 believes (having made all reasonable enquiries) the assumptions,
upon which the forecasts and projections in relation to the CWC
ConsumerCo Business contained in the latest Budget delivered
under Clause 16.5 (Budgets) are based, to be fair and
reasonable; and
15.16.3 has, to the best of its knowledge and belief (having made all
reasonable efforts to make due and careful enquiry), made full
disclosure of all material facts relating to the CWC ConsumerCo
Business to all the persons responsible for the preparing of the
latest Budget delivered under Clause 16.5 (Budgets).
15.17 ENVIRONMENTAL COMPLIANCE
Each member of the Covenant Group has complied in all material respects
with all Environmental Law and obtained and maintained any Environmental
Permits breach of which or, as the case may be, failure to obtain or
maintain which, could reasonably be expected to have a Material Adverse
Effect.
15.18 ENVIRONMENTAL CLAIMS
No Environmental Claim has been commenced or (to the best of the
Borrower's knowledge and belief) is threatened against any member of the
Covenant Group where such claim would be reasonably likely, if
determined against such member of the Covenant Group to have a Material
Adverse Effect.
15.19 NO ENCUMBRANCES
Save (in each case) for Permitted Encumbrances, no Encumbrance exists
over all or any of its present or future revenues or assets and, over
all or any of the present or future revenues or assets of any other
member of the Covenant Group.
15.20 NO LOANS
Save (in each case) for Permitted Loans and Guarantees, no member of the
Covenant Group has made any loans or granted any credit or other
financial accommodation which is or are outstanding.
15.21 EXECUTION OF THIS AGREEMENT
Its execution of each Finance Document to which it is a party and the
performance of its obligations thereunder do not and will not:
15.21.1 conflict with any agreement, mortgage, bond or other instrument
or treaty to which it is party or which is binding upon it or
any of its assets (including, without limitation, the NTL CC
Notes) in a manner that could reasonably be expected to have a
Material Adverse Effect;
15.21.2 conflict with its constitutive documents and rules and
regulations; or
15.21.3 conflict with any applicable law.
15.22 OWNERSHIP OF THE PARENT
The Parent is a wholly-owned subsidiary of NTL Holdings, and no persons
or group of connected persons (as construed in accordance with Clause
9.7 (Mandatory Prepayment due to Change in Control)) has control (as
construed in accordance with Clause 9.7 (Mandatory Prepayment due to
Change in Control)) of, NTL Holdings.
56
58
15.23 LICENCES AND CONSENTS
Each member of the Covenant Group has, at all relevant times, obtained
all material licences (including, without limitation, the Licences),
permissions, authorisations and consents (each an "APPROVAL") required
for the conduct of its business as carried on from time to time, and all
such approvals are valid and subsisting save in any such case where
failure to obtain such an approval or the invalidity of such an approval
or its failure to subsist could not reasonably be expected to have a
Material Adverse Effect and to the best of its knowledge and belief
there has been no act or omission on the part of it, any Covenant Group
member which is likely to give rise to the enforcement, revocation,
material amendment, suspension, withdrawal or avoidance of any of the
approvals or any of the material terms or conditions thereof, which
enforcement, revocation, amendment, withdrawal, suspension or avoidance
could reasonably be expected to have a Material Adverse Effect.
15.24 GOVERNMENT OR REGULATORY AUTHORITY INQUIRY
No member of the Covenant Group has to the best of its knowledge and
belief after due and careful inquiry received any notice or
communication which has not been disclosed to the Agent on or prior to
the date hereof from, or is aware of, any inquiry, investigation or
proceeding on the part of any government, court or regulatory agency or
authority the effect of which, in any such case, could reasonably be
expected to have a Material Adverse Effect.
15.25 INTELLECTUAL PROPERTY
It is not aware of any adverse circumstance relating to the validity,
subsistence or use of any member of the Covenant Group's Intellectual
Property which could reasonably be expected to have a Material Adverse
Effect.
15.26 SECURITY INTEREST
15.26.1 Subject (in each case) to the Reservations, each Security
Document creates the security interest which that Security
Document purports to create or, if that Security Document
purports to evidence a security interest, accurately evidences a
security interest which has been validly created and each
security interest ranks in priority as specified in the Security
Document creating or evidencing that interest.
15.26.2 The shares of Intermediate Parent and the Borrower which are
subject to an Encumbrance under the Security Documents are fully
paid and not subject to any option to purchase or similar rights
and the constitutional documents of such persons do not and
could not restrict or inhibit (whether absolutely, partly, under
a discretionary power or otherwise) any transfer of such shares
pursuant to enforcement of the Security Documents.
15.27 GROUP STRUCTURE
The corporate structure of the UK Group and the NTL Holding Group set
out in the Group Structure Chart delivered pursuant to Clause 2.4
(Conditions Precedent) and the corporate structure of the UK Group, the
Target Group and the NTL Holding Group set out in any Group Structure
Chart delivered to the Agent pursuant to Clause 18.29 (Revised Group
Structure) is true, complete and accurate, in each case as at the date
of its delivery to the Agent.
57
59
15.28 SCHEME INFORMATION
The CWC Circular contains all the material terms of the Scheme and the
information contained in the CWC Circular relating to the Group (other
than the Target Group) and the Scheme and, to the best of its knowledge
and belief, the CWC ConsumerCo Business is true, complete and accurate
in all material respects on its date of despatch. An office copy of the
order of the court sanctioning the Scheme under Section 425 was filed
with the Registrar of Companies for registration pursuant to sub-section
3 of Section 425 on 12 May 2000.
15.29 THE SCHEME
In relation to the Scheme:
15.29.1 no step has been taken which has increased (or may in the
future increase) the offer price under the Scheme beyond the
level specified in the CWC Circular;
15.29.2 no modification, variation or amendment of a material nature
has been made to, and no waiver has been granted in respect
of, any of the conditions set out in Appendix 2 to the CWC
Circular or in the Transaction Agreement;
15.29.3 no press release or other publicity, the text of which has not
previously been agreed with the Agent, which makes reference
to the Facility or to some or all of the Finance Parties has
been issued or allowed to be issued; and
15.29.4 in all material respects relevant in the context of the
Scheme, it and each of its affiliates (as relevant) has
complied with the Code, the Financial Services Xxx 0000, the
Companies Xxx 0000 and all other applicable laws and
regulations.
15.30 EXISTING GROUP INDEBTEDNESS
15.30.1 The Intermediate Parent owes no Financial Indebtedness to any
other members of the Group, other than the Parent.
15.30.2 The Borrower owes no Financial Indebtedness to any members of
the Group, other than the Intermediate Parent.
15.31 REPETITION OF REPRESENTATIONS
The Repeated Representations shall (to the extent applicable) be deemed
to be repeated by the Obligors on each date on which an Advance is or is
to be made and the representations set out in sub-clause 15.15.3 of
Clause 15.15 (Business Plan and Information Memorandum) shall be deemed
to be made on the date that the Information Memorandum is approved by
the Borrower and (save as otherwise disclosed by the Borrower, in
writing to the Agent, prior to the Syndication Date) on the Syndication
Date.
16. FINANCIAL INFORMATION
16.1 ANNUAL STATEMENTS
16.1.1 The Borrower shall as soon as the same become available, but
in any event within 120 days after the end of each of its
financial years, deliver to the Agent in sufficient copies for
the Banks the consolidated financial statements of the UK
Group for such financial year, audited by an internationally
recognised firm of independent auditors licensed to practice
in England and Wales.
58
60
16.1.2 In respect of any of its financial years which end before the
Pushdown Date, the Borrower shall as soon as the same become
available, but in any event within 180 days after the end of
each of those financial years, procure the delivery to the
Agent in sufficient copies for the Banks the consolidated
financial statements of the Target Group for such financial
year, audited by an internationally recognised firm of
independent auditors licensed to practise in England and
Wales.
16.2 QUARTERLY STATEMENTS
16.2.1 The Borrower shall as soon as the same become available, but
in any event within 60 days after the end of each Financial
Quarter, deliver to the Agent in sufficient copies for the
Banks the unaudited consolidated financial statements of the
UK Group for such period.
16.2.2 In respect of any Financial Quarter which ends before the
Pushdown Date, the Borrower shall as soon as the same become
available, but in any event within 60 days after the end of
each of those Financial Quarters, procure the delivery to the
Agent in sufficient copies for the Banks the unaudited
consolidated financial statements of the Target Group for such
period.
16.3 REQUIREMENTS AS TO FINANCIAL STATEMENTS
The Borrower shall ensure that each set of financial statements
delivered by it pursuant to this Clause 16 is:
16.3.1 certified by one of its Authorised Signatories as giving a
true and fair view of its financial condition (and in the case
of the Borrower, after Pushdown the consolidated financial
condition of the UK Group and the consolidated financial
condition of the Target Group) as at the end of the period to
which those financial statements relate and of the results of
its (or, as the case may be, the UK Group's or the Target
Group's) operations during such period; and
16.3.2 accompanied by a comparison to the Business Plan projections
(as updated by the relevant Budget) for the financial year or,
as the case may be, Financial Quarter to which those financial
statements relate.
16.4 COMPLIANCE CERTIFICATES
The Borrower shall ensure that each set of consolidated financial
statements delivered by it pursuant to Clause 16.1 (Annual Statements)
or Clause 16.2 (Quarterly Statements) is accompanied by a Compliance
Certificate signed by two of its Authorised Signatories.
16.5 BUDGETS
The Borrower shall, as soon as the same become available, and in any
event no later than 60 days after the beginning of each of its financial
years, deliver to the Agent in sufficient copies for the Banks an annual
budget (in a form agreed with the Agent and, for the purpose of this
Clause 16.5, assuming that the Pushdown has been completed) prepared by
reference to each Financial Quarter in respect of such financial year
including:
59
61
16.5.1 forecasts of projected disposals (including timing and amount
thereof) on a consolidated basis of the UK Group (including,
prior to the Pushdown Date, the Target Group) for such
financial year;
16.5.2 projected annual profit and loss accounts (including projected
turnover and operating costs) and projected balance sheets and
cash flow statements, together with the main operating
assumptions relating thereto, on a quarterly basis, for such
financial year on a consolidated basis for the UK Group
(including, prior to the Pushdown Date, the Target Group);
16.5.3 revisions to the projections set out in the Business Plan,
together with the main operating assumptions relating thereto,
for such financial year until the Final Maturity Date, based
on the financial condition and performance and prospects of
the UK Group (including, prior to the Pushdown Date, the
Target Group) at such time;
16.5.4 projected Permitted Payments to be made during such financial
year and the (in respect of paragraph (c) of the definition of
Permitted Payments) related Financial Indebtedness of the
relevant member of the NTL Holding Group to which those
Permitted Payments will relate;
16.5.5 projected Capital Expenditure to be incurred on a quarterly
basis for such financial year on a consolidated basis for the
UK Group (including, prior to the Pushdown Date, the Target
Group);
16.5.6 projected EBIT and EBITDA as at the end of each Financial
Quarter in such financial year, for the UK Group and (prior to
the Pushdown Date) the Target Group; and
16.5.7 a qualitative analysis and commentary from the management on
its proposed activities for such financial year.
The Borrower shall provide the Agent with details of any material
changes in the projections delivered under this Clause 16.5 as soon as
reasonably practicable after it becomes aware of any such change.
16.6 HEDGING
The Borrower will promptly notify the Agent upon either it or any member
of the UK Group and prior to the Pushdown Date any member of the Target
Group entering into any Hedging Agreement, provided that the Borrower
shall incur no liability to pay damages for failure to so notify the
Agent of any member of the Target Group entering into any Hedging
Agreement.
16.7 ASSET PASSTHROUGHS AND FUNDING PASSTHROUGHS
The Borrower shall, at least five Business Days prior to effecting
either an Asset Passthrough or a Funding Passthrough provide the Agent
with:
16.7.1 written notice of the proposed Asset Passthrough or Funding
Passthrough;
16.7.2 a summary of the steps to be implemented in connection with
the proposed Asset Passthrough or Funding Passthrough;
60
62
16.7.3 a certificate from an Authorised Signatory of the Borrower,
confirming that the proposed Asset Passthrough or Funding
Passthrough will satisfy all of the requirements of the
definition thereof; and
16.7.4 such other information in relation to the proposed Asset
Passthrough or Funding Passthrough as the Agent may reasonably
request.
16.8 OTHER FINANCIAL INFORMATION
The Borrower shall procure that each member of the UK Group and the
Target Group shall from time to time on the request of the Agent,
furnish the Agent with such information about the business, condition
(financial or otherwise), operations, performance, properties or
prospects of the Intermediate Parent, the UK Group (and, prior to the
Pushdown Date, the Target Group) as the Agent or any Bank (through the
Agent) may reasonably require, PROVIDED THAT the Borrower shall not be
under any obligation to supply any information the supply of which would
be contrary to any confidentiality obligation binding on it and further
provided that the Borrower shall incur no liability to pay damages for
failure so to procure any member of the Target Group.
16.9 ACCOUNTING POLICIES
The Borrower shall ensure that each set of financial statements
delivered pursuant to this Clause 16 is prepared using accounting
policies, practices, procedures and reference period consistent with
those applied in the preparation of the Original Financial Statements
unless, in relation to any such set of financial statements, the
Borrower notifies the Agent that there have been one or more changes in
any such accounting policies, practices, procedures or reference period
and:
16.9.1 the auditors of the Borrower provide:
(a) a description of the changes and the adjustments which
would be required to be made to those financial
statements in order to cause them to use the accounting
policies, practices, procedures and reference period
upon which the relevant Original Financial Statements
were prepared; and
(b) sufficient information, in such detail and format as may
be reasonably required by the Agent, to enable the Banks
to make an accurate comparison between the financial
position indicated by those financial statements and the
relevant Original Financial Statements,
in which case any reference in this Agreement to those
financial statements shall be construed as a reference to
those financial statements as adjusted to reflect the basis
upon which the relevant Original Financial Statements were
prepared; or
16.9.2 the Borrower also notifies the Agent that it is no longer
practicable to test compliance with the financial condition
set out in Clause 17.1 (UK Group Financial Condition) against
the financial statements received in which case:
(a) the Agent and the Borrower shall enter into negotiations
with a view to agreeing alternative financial conditions
to replace those contained in
61
63
Clause 17.1 (UK Group Financial Condition) in order to
maintain a consistent basis for such financial
covenants; and
(b) if, after three months commencing on the date of the
notice given to the Agent pursuant to this sub-clause
16.9.2, the Agent and the Borrower cannot agree
alternative financial conditions which are acceptable to
an Instructing Group, the Agent shall refer the matter
to such internationally recognised accounting firm as
may be agreed between the Borrower and an Instructing
Group for determination of the adjustments required to
be made to such financial statements or the calculation
of such ratios to take account of such change, such
determination to be binding on the parties hereto,
provided that pending such determination the Borrower
shall continue to prepare financial statements and
calculate such ratios in accordance with sub-clause
16.9.1 above.
16.10 GENERAL INFORMATION
16.10.1 The Borrower and the Intermediate Parent shall, as soon as
reasonably practicable, furnish the Agent with such general
information as it or any member of the UK Group is required by
law to supply or make available to its (or such member of the
UK Group's) (a) shareholders (in their capacity as such) or
(b) creditors generally or any class thereof.
16.10.2 Prior to the Pushdown Date, the Borrower shall, as soon as
reasonably practicable, furnish the Agent with such general
information as any member of the Target Group is required by
law to supply or make available to its (or such member of the
Target Group's) (a) shareholders (in their capacity as such)
or (b) creditors generally or any class thereof.
16.11 LITIGATION AND GOVERNMENT OR REGULATORY ENQUIRY The Borrower shall
advise the Agent forthwith of the details of:
16.11.1 any litigation, arbitration or administrative proceedings
pending or threatened against any member of the Covenant Group
or the Target Group which could reasonably be expected to
result in liability of such member of the Covenant Group or
the Target Group in an amount in excess of L5,000,000 (or its
equivalent); and
16.11.2 any notice or communication received by it or, any member of
the Covenant Group or the Target Group from, or any actual or
potential enquiry, investigation or proceedings commenced by,
any government, court or regulatory agency or authority, if
such notice, communication, enquiry, investigation or
proceedings could reasonably be expected to have a Material
Adverse Effect; provided that the Borrower shall incur no
liability to pay damages for failure to advise the Agent of
such pending or threatened litigation, arbitration or
administrative proceedings against the Target Group or notice
or communication received by the Target Group.
16.12 ACQUISITION INFORMATION
The Borrower shall from time to time, on the request of the Agent,
provide the Agent with any material information in the possession of any
member of either the NTL
62
64
Holding Group, the UK Group or (after the Acquisition Date) the Target
Group relating to the Acquisition and/or the Scheme as the Agent may
reasonably request provided that the Borrower (a) shall be under no
obligation to supply any information the supply of which it can
demonstrate would be contrary to any confidentiality obligation binding
on it or on any member of the NTL Holding Group, the UK Group or the
Target Group and (b) shall have no liability to pay damages for failure
to provide such information in the possession of any member of the
Target Group.
17. FINANCIAL CONDITION
17.1 UK GROUP FINANCIAL CONDITION
The Borrower shall ensure that the financial condition of the UK Group
(which shall, for the purposes of this Clause 17.1 be deemed to include
(a) Northampton Cable Television Limited, Herts Cable Limited and Cable
& Wireless Communications (South Hertfordshire) Limited and (b) prior to
the Pushdown Date, the Target Group including NTL Business Limited)
shall be such that:
17.1.1 Ratio of UK Group Net Senior Debt to Annualised EBITDA
The ratio of the UK Group Net Senior Debt on each of the
Quarter Dates specified in column one below to the Annualised
EBITDA of the UK Group for the Relevant Period ended on that
date shall be no greater than the ratio set out in column two
below corresponding to that date.
COLUMN ONE COLUMN TWO
QUARTER DATE UK GROUP NET CASH SENIOR DEBT:
ANNUALISED EBITDA
31 December 2000 13.45:1.00
31 March 2001 11.75:1.00
30 June 2001 9.99:1.00
30 September 2001 7.64:1.00
31 December 2001 6.17:1.00
31 March 2002 6.17:1.00
30 June 2002 4.70:1.00
30 September 2002 4.41:1.00
31 December 2002 4.11:1.00
31 March 2003 4.11:1.00
30 June 2003 3.23:1.00
30 September 2003 3.23:1.00
31 December 2003 2.64:1.00
31 March 2004 2.64:1.00
30 June 2004 2.35:1.00
30 September 2004 2.35:1.00
31 December 2004 2.06:1.00
31 March 2005 2.06:1.00
30 June 2005 and each Quarter Date 1.76:1.00
thereafter
63
65
17.1.2 UK Group Net Senior Interest Cover Ratio
The ratio of the EBITDA of the UK Group for each Relevant
Period ended on the Quarter Dates specified in column one
below to the UK Group Net Cash Senior Finance Charges for that
Relevant Period shall be equal to or greater than the ratio
set out in column two below corresponding to that date.
COLUMN TWO
COLUMN ONE EBITDA: UK GROUP NET CASH
QUARTER DATE SENIOR FINANCE CHARGES
31 December 2000 0.78:1.00
31 March 2001 0.99:1.00
30 June 2001 1.20:1.00
30 September 2001 1.44:1.00
31 December 2001 1.77:1.00
31 March 2002 1.77:1.00
30 June 2002 2.27:1.00
30 September 2002 2.68:1.00
31 December 2002 2.89:1.00
31 March 2003 2.89:1.00
30 June 2003 3.71:1.00
30 September 2003 3.71:1.00
31 December 2003 4.33:1.00
31 March 2004 4.33:1.00
30 June 2004 5.78:1.00
30 September 2004 5.78:1.00
31 December 2004 6.19:1.00
31 March 2005 6.19:1.00
30 June 2005 and each Quarter Date 6.19:1.00
thereafter
17.1.3 Total Interest Cover Ratio
The ratio of the EBITDA of the UK Group for each Relevant
Period ended on the Quarter Dates specified in column one
below to the Total Net Cash Finance Charges for that Relevant
Period shall be equal to or greater than the ratio set out in
column two below corresponding to that date.
COLUMN ONE COLUMN TWO
QUARTER DATE EBITDA: TOTAL NET CASH FINANCE
CHARGES
31 December 2002 1.07:1.00
31 March 2003 1.07:1.00
30 June 2003 1.24:1.00
30 September 2003 1.24:1.00
31 December 2003 1.36:1.00
31 March 2004 1.36:1.00
64
66
30 June 2004 1.44:1.00
30 September 2004 1.44:1.00
31 December 2004 1.65:1.00
31 March 2005 1.65:1.00
30 June 2005 and each Quarter Date 1.86:1.00
thereafter
17.1.4 Ratio of Total Net Debt to Annualised EBITDA
The ratio of the Total Net Debt on each of the Quarter Dates
specified in column one below to the Annualised EBITDA of the
UK Group for the Relevant Period ended on that date shall be
no greater than the ratio set out in column two below
corresponding to that date.
COLUMN ONE COLUMN TWO
QUARTER DATE TOTAL NET DEBT: EBITDA
31 December 2002 12.04:1.00
31 March 2003 11.75:1.00
30 June 2003 9.40:1.00
30 September 2003 9.40:1.00
31 December 2003 8.81:1.00
31 March 2004 8.81:1.00
30 June 2004 6.46:1.00
30 September 2004 6.46:1.00
31 December 2004 6.17:1.00
31 March 2005 6.17:1.00
30 June 2005 and each Quarter Date 5.29:1.00
thereafter
17.2 FINANCIAL DEFINITIONS
In this Agreement the following terms have the following meanings. For
the purpose of the financial definitions set out in this Clause 17.2
references to the UK Group shall be deemed to include (a) Northampton
Cable Television Limited, Herts Cable Limited and Cable & Wireless
Communications (South Hertfordshire) Limited and (b) prior to the
Pushdown Date, the Target Group.
"ANNUALISED EBITDA" means with respect to any Quarter Date, the
consolidated EBITDA of the UK Group, for the Relevant Period ended on
such Quarter Date, multiplied by two.
"CASH" means at any time, cash denominated in sterling (or any other
currency freely convertible to sterling) and credited to an account in
the name of a member of the Parent Covenant Group or (as applicable) the
UK Group with an Eligible Deposit Bank and to which such a member of the
Parent Covenant Group or the UK Group is alone beneficially entitled and
for so long as:
65
67
(a) such cash is repayable on demand and repayment of such cash is
not contingent on the prior discharge of any other indebtedness
of any member of the Parent Covenant Group or the UK Group or of
any other person whatsoever or on the satisfaction of any other
condition; or
(b) such cash has been deposited with an Eligible Deposit Bank as
security for any performance bond, guarantee, standby letter of
credit or similar facility the contingent liabilities relating
to such having been included in the calculation of Parent
Covenant Group Net Debt or, as the case may be, UK Group Net
Senior Debt.
"CURRENT ASSETS" means the aggregate of inventory, trade and other
receivables of each member of the UK Group including sundry debtors (but
excluding cash at bank) maturing within twelve months from the date of
computation.
"CURRENT LIABILITIES" means the aggregate of all liabilities (including
trade creditors, accruals and provisions and prepayments) of each member
of the UK Group falling due within twelve months from the date of
computation but excluding consolidated aggregate Indebtedness for
Borrowed Money of the UK Group falling due within such period and any
interest on such Indebtedness for Borrowed Money due in such period.
"EBIT" means, in respect of any period, the consolidated net income of
the UK Group, for such period adding back (only to the extent, in each
case, deducted in calculating such consolidated net income):
(a) any provision on account of taxation;
(b) any interest (including capitalised interest), commission,
discounts or other fees incurred or payable, received or
receivable, by any member of the UK Group in respect of
Indebtedness for Borrowed Money;
(c) any amounts received or paid pursuant to the interest hedging
arrangements entered into in respect of the Senior Bank Credit
Agreement; and
(d) any items treated as exceptional or extraordinary items and
any other similar items agreed between the Borrower and the
Agent (acting on the instructions of an Instructing Group).
"EBITDA" means, in respect of any period, EBIT for such period adding
back (only to the extent, in each case, deducted in calculating EBIT):
(a) any amount attributable to amortisation of intangible assets
(including goodwill);
(b) depreciation of tangible assets and capitalised costs and
expenses; and
(c) amortisation, or the writing off, of transaction expenses in
relation to the Acquisition,
and deducting any costs and expenses capitalised during such period
(other than costs and expenses incurred in constructing or upgrading
cable networks in the ordinary course of the UK Group's business).
66
68
"ELIGIBLE DEPOSIT BANK" means any bank or financial institution with a
short term rating of at least A1 granted by Standard & Poor's
Corporation or P1 granted by Xxxxx'x Investors Services, Inc.
"EXCESS CASH FLOW" means, for any financial year, Operating Cash Flow
for that period LESS Net Total Debt Service for that period.
"FINANCIAL QUARTER" means the period commencing on the day after one
Quarter Date and ending on the next Quarter Date.
"NET TOTAL DEBT SERVICE" means, in respect of any financial year, the
aggregate of:
(a) Total Net Cash Finance Charges for the two Relevant Periods in
that financial year; and
(b) save to the extent such were immediately reborrowed, the
aggregate of scheduled and mandatory payments of the
principal, capital or nominal amounts of any Indebtedness for
Borrowed Money of any member of the Parent Covenant Group
which fell due during that financial year (excluding any such
payments which relate to subordinated debt (as defined in the
Senior Bank Credit Agreement) where such payments cannot be
made due to the subordination of such subordinated debt (as
defined in the Senior Bank Credit Agreement) remaining in full
force and effect).
"OPERATING CASH FLOW" means, in respect of any financial year, EBITDA of
the UK Group for that financial year after:
(a) adding back:
(i) any decrease in the amount of Working Capital at the
end of such a financial year compared against the
Working Capital at the start of such financial year;
and
(ii) any cash receipt in respect of any exceptional or
extraordinary item; and
(b) deducting:
(i) any amount of Capital Expenditure actually made by
any member of the UK Group;
(ii) any increase in the amount of Working Capital at the
end of such financial year compared against the
Working Capital at the start of that financial year;
(iii) any amount actually paid or due and payable in
respect of taxes on the profits of any member of the
UK Group; and
(iv) any cash payment in respect of any exceptional or
extraordinary item,
and no amount shall be included or excluded more than once.
"PARENT COVENANT GROUP NET DEBT" means, at any time (without double
counting), the aggregate principal, capital or nominal amounts
(including any capitalised interest) of
67
69
indebtedness of any member of the Parent Covenant Group constituting
Indebtedness for Borrowed Money together with any other indebtedness of
any member of the Parent Covenant Group constituting Indebtedness for
Borrowed Money which is due and payable and has not been paid at such
time and in respect of which the grace period (if any) specified in the
documentation relating thereto has expired, but:
(a) excluding Indebtedness for Borrowed Money of any
member of the Parent Covenant Group to another member
of the Group to the extent permitted under this
Agreement; and
(b) deducting the Cash held by members of the Parent
Covenant Group at such time.
"QUARTER DATE" means 31 March, 30 June, 30 September and 31 December in
each year.
"RELEVANT PERIOD" means each period of six months ending on a Quarter
Date.
"TOTAL NET DEBT" means, at any time, the aggregate of the UK Group Net
Senior Debt and the Parent Covenant Group Net Debt.
"TOTAL NET CASH FINANCE CHARGES" means, in respect of each Relevant
Period, the aggregate amount of the interest (including the interest
element of leasing and hire purchase payments) commission, fees and
other periodic finance payments paid or due and payable in cash on the
Total Net Debt during such a Relevant Period,
(a) adding any commission, fees and other finance payments payable
by any member of the Parent Covenant Group and the UK Group in
cash under any interest rate hedging arrangement;
(b) deducting any commission, fees and other finance payments
receivable by any member of the Parent Covenant Group and the
UK Group under any interest rate hedging instrument permitted
by this Agreement; and
(c) deducting any interest receivable by any member of the Parent
Covenant Group and the UK Group on any deposit or bank
account.
"UK GROUP NET SENIOR DEBT" means, at any time (without double
counting), the aggregate principal, capital or nominal amounts
(including any capitalised interest) of indebtedness of any member of
the UK Group constituting Indebtedness for Borrowed Money together with
any other indebtedness of any member of the UK Group constituting
Indebtedness for Borrowed Money which is due and payable and has not
been paid at such time and in respect of which the grace period (if
any) specified in the documentation relating thereto has expired but:
(a) excluding such Indebtedness for Borrowed Money of any member
of the UK Group to another member of the UK Group to the
extent permitted under this Agreement;
(b) excluding any Indebtedness for Borrowed Money to the extent
such is Subordinated UK Group Debt; and
68
70
(c) deducting the Cash held by members of the UK Group at such
time.
"UK GROUP NET CASH SENIOR FINANCE CHARGES" means, in respect of each
Relevant Period, the aggregate amount of the interest (including the
interest element of leasing and hire purchase payments) commission, fees
and other periodic finance payments paid or due and payable in cash on
the UK Group Net Senior Debt during such a Relevant Period,
(a) adding any commission, fees and other finance payments payable
by any member of the UK Group in cash under any interest rate
hedging arrangement;
(b) deducting any commission, fees and other finance payments
receivable by any member of the UK Group under any interest
rate hedging arrangement permitted by this Agreement; and
(c) deducting any interest receivable by any member of the UK
Group on any deposit or bank account.
"WORKING CAPITAL" means on any date Current Assets less Current
Liabilities.
17.3 ACCOUNTING TERMS
All accounting expressions which are not otherwise defined herein shall
be construed in accordance with generally accepted accounting principles
in England.
18. COVENANTS
18.1 NOTIFICATION OF EVENTS OF DEFAULT
The Borrower shall promptly inform the Agent of the occurrence of any
Event of Default or Potential Event of Default and, upon receipt of a
written request to that effect from the Agent, confirm to the Agent
that, save as previously notified to the Agent or as notified in such
confirmation, no Event of Default or Potential Event of Default has
occurred and is continuing.
18.2 CLAIMS PARI PASSU
Each Obligor shall ensure that subject to the Reservations:
18.2.1 at all times the claims of the Finance Parties against such
Obligor under the Finance Documents (other than the Security
Documents) to which such Obligor is party rank at least pari
passu with the claims of all its other unsecured and
unsubordinated creditors; and
18.2.2 at all times the claims of the Finance Parties against such
Obligor under the Security Documents to which such Obligor is
party rank ahead of the claims of all its other creditors
(other than (if and to the extent applicable) creditors with
the benefit of Permitted Encumbrances) against the assets the
subject of the Encumbrances created by such Security
Documents.
18.3 MAINTENANCE AND LEGAL VALIDITY
Each Obligor shall:
18.3.1 do all such things as are necessary to maintain its existence
as a legal person (other than as part of a solvent
reorganisation on terms which have been
69
71
approved in writing by the Agent acting on the instructions of
an Instructing Group); and
18.3.2 obtain, comply with the terms of and do all that is necessary
to maintain in full force and effect all authorisations,
approvals, licences and consents required in or by the laws
and regulations of each jurisdiction in which it owns or
leases property or in which it conducts its business to enable
it lawfully to enter into and perform its obligations under
each of the Finance Documents to which it is expressed to be a
party or to ensure the legality or validity or (subject to the
Reservations) enforceability or admissibility in evidence in
each jurisdiction in which it owns or leases property or in
which it conducts its business (to the extent applicable) of
each such Finance Document.
The Borrower shall procure that each member of the UK Group shall do all
such things as are necessary to maintain its existence as a legal
entity.
18.4 INSURANCE
Each Covenant Group Obligor shall, and shall procure that each member of
the UK Group shall, effect and maintain, insurances (or, in the case of
NTL Insurance Limited (or its successor as the UK Group's captive
insurance company), insurances and re-insurances) on and in relation to
its business and assets against such risks as is reasonable for a
company carrying on a business such as that carried on by such Obligor
or, as the case may be, such member of the UK Group with either (save in
respect of NTL Insurance Limited's own insurance) NTL Insurance
Limited (or its successor as the UK Group's captive insurance company)
or with a reputable underwriter or insurance company and, in the case of
NTL Insurance Limited (or its successor as the UK Group's captive
insurance company), with a reputable underwriter or insurance or
reinsurance company.
18.5 ENVIRONMENTAL COMPLIANCE
Each Covenant Group Obligor shall, and shall procure that each member of
the UK Group shall, comply in all material respects with all
Environmental Law and obtain and maintain any Environmental Permits,
breach of which (or failure to obtain or maintain which) could
reasonably be expected to have a Material Adverse Effect.
18.6 ENVIRONMENTAL CLAIMS
Each Covenant Group Obligor shall, and shall procure that each member of
the UK Group shall, inform the Agent in writing as soon as reasonably
practicable upon becoming aware of the same if any Environmental Claim
has been commenced or (to the best of such person's knowledge and
belief) is threatened against it in any case where such claim would be
reasonably likely, if adversely determined, to have a Material Adverse
Effect, or of any facts or circumstances which will or are reasonably
likely to result in any Environmental Claim being commenced or
threatened against such Obligor or any member of the UK Group in any
case where such claim would be reasonably likely, if determined against
such person, to have a Material Adverse Effect.
18.7 MAINTENANCE OF LICENCES AND OTHER AUTHORISATION
Each Covenant Group Obligor shall, and shall procure that each member
of the UK Group shall:
70
72
18.7.1 ensure that it has the right and is duly qualified to conduct
its business and to the extent that the loss of any contract,
authorisation, approval, licence, consent, right or franchise
could reasonably be expected to have a Material Adverse Effect,
do all things necessary to obtain, preserve, keep valid and
binding and, where relevant, renew all such contracts,
authorisations, approvals, licences, consents, rights and
franchises; and
18.7.2 ensure that each Licence (or any replacement or renewal thereof)
is held by a member of the UK Group.
18.8 CONDUCT BUSINESS IN ACCORDANCE WITH LICENCES
Each Covenant Group Obligor shall, and shall procure that each member of
the UK Group shall, carry on its business, or cause the same to be
carried on, in accordance with the terms and conditions of the Licences
in all material respects and no Covenant Group Obligor shall (and each
Covenant Group Obligor shall procure that no member of the UK Group
shall) do, omit to do or suffer to be done, any act whereby any person
is entitled or empowered to revoke, materially and adversely amend,
suspend, withdraw or terminate any Licence if such amendment,
revocation, suspension, withdrawal or termination could reasonably be
expected to have a Material Adverse Effect.
18.9 STATUTORY REQUIREMENTS
Each Covenant Group Obligor shall, and shall procure that each member of
the UK Group shall, comply in all material respects with all Statutory
Requirements binding upon it or enforceable against it in respect of the
conduct of its business and the ownership of its properties if and
insofar as failure to do so could reasonably be expected to have a
Material Adverse Effect.
18.10 REGULATORY NOTICES AND COMMUNICATIONS
The Borrower shall notify the Agent within fourteen days upon receipt by
any Covenant Group Obligor or any member of the UK Group of any notice
or communication from any government, court or regulatory authority or
agency (including, without prejudice to the generality of the foregoing,
the Secretary of State for Trade and Industry, Oftel or the
Radiocommunications Agency) which may give rise to the revocation,
termination, material adverse amendment, suspension, withdrawal or
avoidance of any Licences or any of the terms and conditions thereof if
such revocation, termination, material adverse amendment, suspension,
withdrawal or avoidance could reasonably be expected to have a Material
Adverse Effect.
18.11 COMPLIANCE WITH MATERIAL COMMERCIAL CONTRACTS
Each Covenant Group Obligor shall, and shall procure that each member
of the UK Group shall:
18.11.1 comply in all material respects with its obligations under
each Material Commercial Contract to which it is a party and
take all action necessary to ensure the continued validity and
enforceability of its rights thereunder;
18.11.2 not amend, vary, novate or supplement any such Material
Commercial Contract in any material respect;
18.11.3 not terminate any such Material Commercial Contract prior to
its contractual
71
73
termination date,
if such non-compliance, failure to take action, amendment, variation,
novation or supplement or termination, as the case may be, could
reasonably be expected to have a Material Adverse Effect.
18.12 PRESERVATION OF ASSETS
Each Covenant Group Obligor shall and shall procure that each member of
the UK Group shall, maintain and preserve all of its assets that are
necessary and material in the conduct of its business as conducted at
the date hereof in good working order and condition (ordinary wear and
tear excepted), repair (with reasonable promptness) any damage to such
assets and shall maintain in all material respects all books and records
which are necessary in connection therewith or in connection with the
conduct of its business.
18.13 SECURITY
Each Covenant Group Obligor shall, at its own expense, take all such
action as the Agent may reasonably require for the purpose of perfecting
or protecting the Finance Parties' rights under and preserving the
security interests intended to be created or evidenced by any of the
Finance Documents to which it is a party, and following the making of
any declaration pursuant to Clause 19.16 (Acceleration and Cancellation)
or 19.17 (Advances Due on Demand) for facilitating the realisation of
any such security or any part thereof.
18.14 ACCESS
Each Covenant Group Obligor shall ensure that any one or more
representatives, agents and advisers of the Agent and/or any of the
Banks will be allowed, whilst an Event of Default or Potential Event of
Default is continuing and with prior notice, to have access to the
assets, books, records and premises of each Covenant Group Obligor and
each UK Group member and be permitted to inspect the same during normal
business hours.
18.15 SUBORDINATED DEBT
The Parent shall ensure that Subordinated Debt is the only indebtedness
owed by the Intermediate Parent, the Borrower or any other Guarantor to
any member of the Group.
18.16 TELECENTIAL PARTNERSHIPS
The Borrower shall procure that, unless all of the partners of the
Telecential Partnerships are wholly-owned members of the UK Group and
are subject to an Encumbrance pursuant to the security documents under
the Senior Bank Credit Agreement:
18.16.1 the aggregate of (a) the amount of any loans made by any
member of the UK Group to either of the Telecential
Partnerships after the Execution Date, (b) the book value of
any assets contributed by either CableTel Limited or CableTel
Investments Limited to either of the Telecential Partnerships
after the Execution Date and (c) any cash contributed by
either CableTel Limited or CableTel Investments Limited to
either of the Telecential Partnerships after the Execution
Date does not exceed L25,000,000; and
18.16.2 any such loan, asset contribution or cash contribution made by
any members of the UK Group within such a L25,000,000
threshold is only made to the extent
72
74
and in the manner required by the partnership agreements
relating to the Telecential Partnerships, together with a
loan, asset contribution or cash contribution by the minority
partner in the relevant Telecential Partnership (and funded by
the minority shareholder in such a minority partner).
18.17 HEDGING
The Borrower will:
18.17.1 promptly notify the Agent upon either it or any member of the
UK Group or, prior to the Pushdown Date, any member of the
Target Group entering into any currency swap or interest swap,
cap or collar arrangements or any other derivative instrument
or transaction; and
18.17.2 not enter into and procure that no member of the UK Group and,
prior to the Pushdown Date, no member of the Target Group
shall enter into any currency swap or interest swap, cap or
collar arrangements or any other derivative instrument or
transaction other than in accordance with the Hedging
Strategy.
18.18 NEGATIVE PLEDGE
No Covenant Group Obligor shall, and each Covenant Group Obligor shall
procure that no member of the UK Group shall, create or permit to
subsist any Encumbrance over all or any of its present or future
undertaking, revenues or assets other than Permitted Encumbrances.
18.19 LOANS AND GUARANTEES
No Covenant Group Obligor shall, and each Covenant Group Obligor shall
procure that no member of the UK Group shall, (save in the ordinary
course of business) make any loans, grant any credit or give any
guarantee or indemnity to or for the benefit of any person or
voluntarily assume any liability, whether actual or contingent, in
respect of any obligation of any other person other than Permitted Loans
and Guarantees.
18.20 DISPOSALS
No Covenant Group Obligor shall, and each Covenant Group Obligor shall
procure that no member of the UK Group shall, sell, lease, transfer or
otherwise dispose of, by one or more transactions or series of
transactions (whether related or not), the whole or any part of its
revenues or its assets other than any Permitted Disposal.
18.21 FINANCIAL INDEBTEDNESS
18.21.1 No Covenant Group Obligor shall, and each Covenant Group
Obligor shall procure that no member of the UK Group shall,
incur or allow to subsist, any Financial Indebtedness or enter
into any agreement or arrangement whereby it is entitled to
incur, create or allow to subsist any Financial Indebtedness
other than Permitted Indebtedness.
18.21.2 The Parent shall procure that the Intermediate Parent and the
Intermediate Parent shall procure that the Borrower shall not
incur, or allow to subsist, any Financial Indebtedness between
it and any other members of the NTL Holding Group or enter
into any agreement or arrangement whereby it is entitled to
incur, create or allow to subsist any such Financial
Indebtedness other than
73
75
Financial Indebtedness owed (a) in the case of the
Intermediate Parent, by it to the Parent and (b) in the case
of the Borrower, by it to the Intermediate Parent.
18.21.3 The Parent and Intermediate Parent shall procure that the only
Financial Indebtedness outstanding between the Intermediate
Parent and the Borrower is Subordinated Debt and Assigned
Debt.
18.21.4 The Intermediate Parent and the Borrower shall procure that
the only Financial Indebtedness outstanding between the
Intermediate Parent and the Borrower is Subordinated Debt and
Assigned Debt.
18.22 RESTRICTED PAYMENTS
The Intermediate Parent shall not and shall procure that no member of
the UK Group shall make any Restricted Payment other than Permitted
Payments.
18.23 ACQUISITIONS AND INVESTMENTS
No Covenant Group Obligor shall, and each Covenant Group Obligor shall
procure that no member of the UK Group shall, (a) purchase, subscribe
for or otherwise acquire any shares (or other securities or any interest
therein) in, or incorporate, any other company or agree to do any of the
foregoing, or (b) purchase or otherwise acquire any assets (other than
in the ordinary course of business) or revenues or (without limitation
to any of the foregoing) acquire any business or interest therein or
agree to do so, save for (and for agreements relating to):
18.23.1 any investment or acquisition of assets contemplated in the
Business Plan or arising out of expenditure being financed by
the Senior Bank Credit Agreement;
18.23.2 any investment in a Project Company made out of Available
Excess Cash Flow;
18.23.3 Permitted Investments; and
18.23.4 Permitted Acquisitions.
18.24 MERGERS
No Covenant Group Obligor shall, and each Covenant Group Obligor shall
procure that no member of the UK Group shall, enter into any merger or
consolidation with any other person save for, respectively, another
member of the UK Group (in the case of a member of the UK Group). The
Parent shall not enter into any merger or consolidation with any other
person if the validity, perfection or priority of the Security would be
adversely impaired as a result thereof.
18.25 CHANGE OF BUSINESS
Save as contemplated in the Business Plan (and PROVIDED THAT nothing in
this Clause 18.25 shall prevent a member of the Covenant Group from
making any investment or disposal which is otherwise permitted under
this Agreement) no Covenant Group Obligor shall, and each Covenant Group
Obligor shall procure that no member of the UK Group shall, enter into
any type of business sector which would result in a change in the
business focus of the UK Group taken as a whole from its business focus
as at the date hereof.
74
76
18.26 SHARES
No Covenant Group Obligor shall, and each Covenant Group Obligor shall
procure that no member of the UK Group shall, without the prior written
consent of an Instructing Group, alter any rights attaching to its
issued shares if those shares are subject to the Security and such an
alteration would be reasonably likely to prejudice to value of, or the
ability of the Security Trustee to realise the security over those
shares.
18.27 TRANSACTIONS WITH AFFILIATES
No Covenant Group Obligor shall, and each Covenant Group Obligor shall
procure that no member of the UK Group shall, enter into any transaction
with an affiliate other than:
18.27.1 transactions in respect of either Subordinated Funding or
Parent Funding;
18.27.2 transactions between members of the UK Group;
18.27.3 transactions in the ordinary course of business and either on
no worse than arms' length terms or, where there is no
available market by which to assess whether such a transaction
is on no worse than arms' length terms, on terms such that in
the reasonable opinion of the Borrower the transaction is
financially fair to the relevant Covenant Group Obligor or, as
the case may be, member of the UK Group or, as the case may
be, member of the Target Group;
18.27.4 transactions to effect either an Asset Passthrough or a
Funding Passthrough;
18.27.5 insurance arrangements entered into in the ordinary course of
business with NTL Insurance Limited (or its successor as the
captive insurance company to the UK Group);
18.27.6 tax sharing arrangements and agreements to surrender fax
losses;
18.27.7 transactions relating to the provision of Intra-Group
Services;
18.27.8 transactions relating to Excess Capacity Network Services
PROVIDED THAT the price payable by any affiliates in relation
to such Excess Capacity Network Services is no less than the
cost incurred by the relevant obligor, member of the UK Group
or, as the case may be, member of the Target Group in
providing such Excess Capacity Network Services; and
18.17.9 transactions constituted by loans or investments in any UK
Group Exclude Subsidary, where such are otherwise permitted
under this Agreement.
18.28 CHANGE IN FINANCIAL YEAR
No Covenant Group Obligor shall, and each Covenant Group Obligor shall
procure that no member of the UK Group shall, change the end of its
financial year, other than as agreed by an Instructing Group, acting
reasonably or so as to ensure that the financial year of each member of
the Target Group ends on the same date as the financial year of each
member of the UK Group; provided that the Borrower shall incur no
liability to pay damages for failure to so procure with respect to any
member of the Target Group.
75
77
18.29 REVISED GROUP STRUCTURE
18.29.1 The Borrower shall, within 30 days of the Execution Date,
deliver to the Agent the Group Structure Chart referred to in
paragraph (b) of the definition of that term;
18.29.2 If any Covenant Group Obligor becomes aware of any material
inaccuracy in the corporate structure as set out in either the
Group Structure Chart delivered to the Agent pursuant to
Clause 2.4 (Conditions Precedent) or any Group Structure Chart
delivered to the Agent pursuant to this Clause 18.29, it will
deliver to the Agent as soon as reasonably practicable
thereafter a revised Group Structure Chart which is true,
complete and accurate.
18.30 ISSUANCE OF CAPITAL STOCK
The Parent shall procure that no capital stock of the Borrower or any
Guarantor (other than the Parent) is held by any person which is not a
wholly-owned subsidiary of the Parent or a Guarantor which is either
party to this Agreement on the Execution Date or has become a Guarantor
pursuant to Clause 37 (Accession of Guarantors) and all the requirements
set forth on Schedule 11 with respect thereto have been satisfied.
18.31 RESTRICTIONS ON PAYMENTS
No Covenant Group Obligor shall, and each Covenant Group Obligor shall
procure that no member of the UK Group shall, enter into any
restrictions on the ability of any member of the UK Group to pay
dividends, to make loans to, repay or prepay loans made by, or transfer
assets to, the Borrower or any other member of the UK Group, except for
(a) the restrictions set forth in the Senior Bank Credit Agreement as in
effect on the Execution Date; (b) restrictions entered into in
connection with the incurrence of Financial Indebtedness incurred
pursuant to clause (i) or clause (m) of the definition of Permitted
Indebtedness provided that such restrictions are no more restrictive
than those set forth in the Senior Bank Credit Agreement as in effect on
the Execution Date; (c) restrictions imposed by applicable law; and (d)
customary non assignment provisions in leases entered into in the
ordinary course of business and consistent with past practice.
18.32 INVESTMENTS IN THE UK GROUP
The Borrower shall procure that notwithstanding anything to the contrary
set forth in this Agreement all investments by the Borrower in the UK
Group will be in the form of loans (except that to the extent that the
Borrower determines in good faith that it is tax efficient to make such
investments in the form of equity or capital contribution, and the
outstanding principal amount of intercompany loans made by the Borrower
is at no time less than L1,300,000,000 (or, if less, the outstanding
principal amount of the Loan and the Available Facility) such
investments may be in the form of equity or capital contributions).
18.33 MAINTENANCE OF CORPORATE SEPARATENESS
The Parent (x) will, and will procure that each other Guarantor and the
Borrower satisfies customary corporate formalities, including the
holding of regular board of directors' and shareholders' meetings or
action by directors or shareholders without a meeting and the
maintenance of corporate offices and records; and (y) will not take any
action, or conduct its affairs in a manner, which could result in the
corporate existence of any such person being ignored, or in the assets
and liabilities of any such person being
76
78
substantively consolidated with those of any other such person in a
bankruptcy, reorganization or other insolvency proceeding.
19. EVENTS OF DEFAULT
Each of Clause 19.1 (Failure to Pay) to Clause 19.16 (Material Adverse
Change) describes circumstances which constitute an Event of Default for
the purposes of this Agreement. Clause 19.17 (Acceleration and
Cancellation) and Clause 19.18 (Advances Due on Demand) deal with the
rights of the Agent and the Banks after the occurrence of an Event of
Default.
19.1 FAILURE TO PAY
Any of the Obligors fails to pay any sum due from it under any of the
Finance Documents to which it is a party at the time, in the currency
and in the manner specified therein unless:
19.1.1 the sum is of a principal amount which was not paid as a
result of a technical error or failure in the transmission of
funds and that payment is then received by the Agent within
one Business Day of the due date;
19.1.2 the sum is of an amount of interest and that payment is then
received by the Agent within three Business Days of the due
date; or
19.1.3 the sum is of an amount other than principal or interest and
that payment is then received by the Agent within five
Business Days of the due date.
19.2 MISREPRESENTATION
Any representation or statement made or repeated by any Obligor in any
of the Finance Documents or in any notice or other document or
certificate delivered by it pursuant thereto or in connection therewith
is or proves to have been incorrect or misleading in any material
respect when made or deemed to be made and the circumstances giving rise
to such inaccuracy, if capable of remedy or change, are not remedied or
do not change, such that the relevant representation or statement would
be correct and not misleading if repeated five Business Days after the
earlier of (a) it being notified by the Agent to the Group
Representative in all other cases, as having been made inaccurately and
(b) the relevant Obligor becoming aware of such inaccuracy.
19.3 SPECIFIC COVENANTS
Any of the Obligors fails to comply with any of its obligations under
Clause 16 (Financial Information) or Clause 18 (Covenants). No Event of
Default under this Clause 19.3 shall occur in relation to:
19.3.1 Clause 16.1 (Annual Statements) to Clause 16.8 (Other
Financial Information), Clause 16.10 (General Information) or
Clause 16.12 (Acquisition Information), if the failure to
comply with such is remedied within five Business Days of the
Agent giving notice thereof to the Group Representative; and
19.3.2 Clause 18 (Covenants), if the failure to comply with such is
capable of remedy and is remedied within five Business Days of
the date on which an Obligor became aware of such failure to
comply PROVIDED THAT a breach of any of the obligations under
Clause 18.2 (Claims Pari Passu), Clause 18.3 (Maintenance
77
79
and Legal Validity), Clause 18.8 (Conduct Business in
Accordance with Licences), Clause 18.18 (Negative Pledge),
Clause 18.19 (Loans and Guarantees), Clause 18.20 (Disposals),
Clause 18.22 (Restricted Payments), Clause 18.23 (Acquisitions
and Investments), Clause 18.24 (Mergers) and Clause 18.27
(Transactions with Affiliates) shall immediately give rise to
an Event of Default.
19.4 OTHER OBLIGATIONS
Any of the Obligors fails duly to perform or comply with any other
obligation expressed to be assumed by it in any of the Finance Documents
and such failure is not remedied within thirty days after the Agent has
given notice thereof to the Borrower.
19.5 FINANCIAL CONDITION
At any time any of the requirements of Clause 17.1 (UK Group Financial
Condition) is not satisfied.
19.6 CROSS DEFAULT
Any:
19.6.1 Financial Indebtedness of any member of the Covenant Group is
not paid when due and payable (after taking account of any
applicable grace period) or, if payable on demand (after
taking account of any applicable grace period), is not paid on
demand;
19.6.2 Financial Indebtedness of any member of the Covenant Group is
declared to be or otherwise becomes due and payable prior to
its specified maturity by reason of a default by the relevant
member of the Covenant Group;
19.6.3 commitment for any Financial Indebtedness of any member of the
Covenant Group is cancelled or suspended by reason of a
default by the relevant member of the Covenant Group; or
19.6.4 holder or holders, creditor or creditors of any member of the
Parent Covenant Group becomes entitled to declare any
Specified Financial Indebtedness of such member of the Parent
Covenant Group due and payable prior to its specified maturity
by reason of default by the relevant member of the Parent
Covenant Group after taking account of any applicable grace
period,
save that (x) this Clause shall not apply to any Financial Indebtedness
of any Obligor or of any other member of the UK Group where such
Financial Indebtedness or demand in relation thereto (a) is a Permitted
Project Borrowing, (b) is cash collateralised and such cash is available
for application in satisfaction of such Financial Indebtedness, (c) is
being contested in good faith by appropriate action or (d) when
aggregated with all such Financial Indebtedness of the Covenant Group
does not exceed an aggregate of L20,000,000 (or its equivalent in other
currencies) and (y) for the avoidance of doubt, an Event of Default
shall not accrue under sub-clause 19.6.4 of this Clause 19.6 by reason
of the occurrence of an event described therein in respect of the
Financial Indebtedness of a member of the UK Group (including, without
limitation, the Senior Bank Credit Agreement).
78
80
19.7 INSOLVENCY AND RESCHEDULING
Any Obligor or any member of the UK Group:
19.7.1 is unable to pay its debts as they fall due;
19.7.2 commences negotiations with any one or more of its creditors
with a view to the general readjustment or rescheduling of its
indebtedness (other than as part of a solvent reorganisation
of the UK Group on terms which have been approved in writing
by the Agent, acting on the instructions of an Instructing
Group);
19.7.3 makes a general assignment for the benefit of or a composition
with its creditors; or
19.7.4 has a moratorium declared in respect of any of its
indebtedness.
19.8 WINDING-UP
Any Obligor or any member of the UK Group takes any corporate action or
other steps are taken or legal proceedings are started and served for
its winding-up, dissolution, administration or re-organisation whether
by way of voluntary arrangement, scheme of arrangement or otherwise or
for the appointment of a liquidator, receiver, administrator,
administrative receiver, conservator, custodian, trustee or similar
officer of it or of its revenues and assets PROVIDED THAT it shall not
constitute an Event of Default if:
19.8.1 such action, steps or proceedings relate to a solvent
liquidation or re-organisation of a member of the UK Group
(other than the Borrower) or are on terms which have been
approved in writing by the Agent, acting on the instructions
of an Instructing Group; or
19.8.2 such action, steps or proceedings (a) are frivolous or
vexatious, (b) do not relate to the appointment of an
administrator (or its equivalent in any other jurisdiction)
and (c) are contested in good faith by appropriate legal
action and are stayed or discharged within thirty days of
their commencement.
19.9 EXECUTION OR DISTRESS
Any execution or distress is levied against, or an encumbrancer takes
possession of, the whole or any part of, the property, undertaking or
assets of any Obligor or any member of the UK Group, where:
19.9.1 the aggregate value of such assets exceeds L250,000; and
19.9.2 such execution, distress or possession is not discharged
within fourteen days.
19.10 ANALOGOUS EVENTS
Any event occurs which under the laws of any jurisdiction has a similar
or analogous effect to any of those events mentioned in Clause 19.7
(Insolvency and Rescheduling), Clause 19.8 (Winding-up) or Clause 19.9
(Execution or Distress).
19.11 GOVERNMENTAL INTERVENTION
By or under the authority of any government, (a) the management of any
Covenant Group Obligor or any other member of the UK Group is wholly or
partially displaced or the authority of any Covenant Group Obligor or
any other member of the UK Group in the conduct of a material part of
its business is wholly or partially curtailed or (b) all or a
79
81
majority of the issued shares of any Covenant Group Obligor or any
other member of the UK Group or the whole or any part of its revenues
or assets is seized, nationalised, expropriated or compulsorily
acquired, in each case where such is not remedied to the satisfaction
of the Agent within thirty days of the relevant event occurring.
19.12 REPUDIATION
19.12.1 Any Obligor repudiates any of the Finance Documents; or
19.12.2 the security intended to be created by, or the subordination
effected under, the Finance Documents is not or ceases to be
legal and valid and (except as contemplated by the
Reservations or, if capable of remedy, such as is remedied
within five Business Days of the earlier of (a) notice of the
relevant event by the Agent to the Group Representative and
(b) the date on which the relevant Obligor becomes aware of
such event) binding and enforceable.
19.13 ILLEGALITY
At any time it is or becomes unlawful for any of the Obligors to perform
or comply with any or all of its obligations under any of the Finance
Documents to which it is a party or any of the obligations of any of the
Obligors thereunder are not or cease to be legal, valid and (except as
contemplated by the Reservations or, if capable of remedy, such as is
remedied within five Business Days of the earlier of (a) notice of the
relevant event by the Agent to the Group Representative and (b) the date
on which the relevant Obligor becomes aware of such event) binding and
enforceable.
19.14 ASSET ADJUSTMENT PAYMENTS
If, following a member of the Target Group having made an Asset
Adjustment Payment within paragraph (a) of the definition thereof, NTL
Holdings fails to procure that an amount equal to such an Asset
Adjustment Payment is (in accordance with the other terms of this
Agreement) reimbursed to that member of the Target Group on or before
the date which is the earlier of:
19.14.1 ten Business Days after the date on which NTL Inc. receives a
reimbursement from C&W for such an Asset Adjustment Payment;
and
19.14.2 thirty Business Days after the date on which such an Asset
Adjustment Payment is made,
PROVIDED THAT, the aggregate amount of Asset Adjustment Payments for
which members of the Target Group have not been reimbursed in accordance
with this Clause 19.14 exceeds L10,000,000 (or its equivalent).
19.15 DEBT ADJUSTMENT PAYMENTS
If, following a Debt Adjustment Payment having being made to NTL
Holdings (or any other member of the Group) in accordance with paragraph
(a) of the definition thereof, NTL Holdings fails to procure that an
amount equal to such a Debt Adjustment Payment is (in accordance with
the other terms of this Agreement) invested in the Target Group by the
date which is:
19.15.1 in respect of Debt Adjustment Payments anticipated on the
Execution Date, ten Business Days after the date on which NTL
Holdings receives such a Debt Adjustment Payment; and
80
82
19.15.2 in respect of all other Debt Adjustment Payments, thirty
Business Days after the date on which NTL Holdings receives
such a Debt Adjustment Payment,
PROVIDED THAT the aggregate amount of Debt Adjustment Payments for which
members of the Target Group have not been reimbursed in accordance with
this Clause 19.15 exceeds L10,000,000 (or its equivalent).
19.16 MATERIAL ADVERSE CHANGE
Any event or circumstance which would have a Material Adverse Effect
occurs.
19.17 ACCELERATION AND CANCELLATION
Upon the occurrence of an Event of Default at any time thereafter whilst
such event is continuing, the Agent may (and, if so instructed by an
Instructing Group, shall) by written notice to the Borrower:
19.17.1 declare the Advances to be immediately due and payable
(whereupon the same shall become so payable together with
accrued interest thereon and any other sums then owed by the
Borrower hereunder) or declare the Advances to be due and
payable on demand of the Agent; and/or
19.17.2 declare that any undrawn portion of the Facility shall be
cancelled, whereupon the same shall be cancelled and the
Available Commitment of each Bank shall be reduced to zero;
and/or
19.17.3 exercise or direct the Security Trustee to exercise (on its
own behalf and on behalf of the Banks) all rights and remedies
of a mortgagee or a secured party at such time and (without
limitation), subject to the Security Documents and to the
extent permitted by applicable law, (a) foreclose on any or
all of the assets subject to the Security by any available
judicial procedure, (b) take possession of any or all of the
assets subject to the Security and the books and records
relating thereto, with or without judicial process and/or (c)
enter any premises where any assets subject to the Security,
or any books and records relating thereto, are located and
take possession of and remove the same therefrom.
19.18 ADVANCES DUE ON DEMAND
If, pursuant to Clause 19.17 (Acceleration and Cancellation), the Agent
declares the Advances to be due and payable on demand of the Agent,
then, and at any time thereafter, the Agent may (and, if so instructed
by an Instructing Group, shall) by written notice to the Borrower:
19.18.1 require repayment of the Advances on such date as it may
specify in such notice (whereupon the same shall become due
and payable on such date together with accrued interest
thereon and any other sums then owed by the Borrower
hereunder) or withdraw its declaration with effect from such
date as it may specify in such notice;
19.18.2 select as the duration of any Interest Period which begins
whilst such declaration remains in effect a period of six
months or less; and/or.
19.18.3 exercise or direct the Security Trustee to exercise (on its
own behalf and on behalf of the Banks) all rights and remedies
of a secured party in accordance
81
83
with sub-clause 19.17.3 of Clause 19.17 (Acceleration and
Cancellation).
20. GUARANTEE AND INDEMNITY
20.1 GUARANTEE AND INDEMNITY
Each of the Guarantors irrevocably and unconditionally jointly and
severally:
20.1.1 guarantees to each Finance Party the due and punctual
observance and performance of all the terms, conditions and
covenants on the part of each Borrower contained in the
Finance Documents and agrees to pay from time to time on
demand any and every sum or sums of money which each Borrower
is at any time liable to pay to any Finance Party under or
pursuant to the Finance Documents and which has become due and
payable but has not been paid at the time such demand is made;
and
20.1.2 agrees as a primary obligation to indemnify each Finance Party
from time to time on demand from and against any loss incurred
by any Finance Party as a result of any of the obligations of
each Borrower under or pursuant to the Finance Documents being
or becoming void, voidable, unenforceable or ineffective as
against such Borrower for any reason whatsoever, whether or
not known to any Finance Party or any other person, the amount
of such loss being the amount which the person or persons
suffering it would otherwise have been entitled to recover
from such Borrower.
20.2 ADDITIONAL SECURITY
The obligations of each Guarantor herein contained shall be in addition
to and independent of every other security which any Finance Party may
at any time hold in respect of any of any Obligor's obligations under
the Finance Documents.
20.3 CONTINUING OBLIGATIONS
The obligations of each Guarantor herein contained shall constitute and
be continuing obligations notwithstanding any settlement of account or
other matter or thing whatsoever and shall not be considered satisfied
by any intermediate payment or satisfaction of all or any of the
obligations of the Borrowers under the Finance Documents and shall
continue in full force and effect until final payment in full of all
amounts owing by any Borrower under the Finance Documents and total
satisfaction of all the Borrowers' actual and contingent obligations
under the Finance Documents.
20.4 OBLIGATIONS NOT DISCHARGED
Neither the obligations of each Guarantor herein contained nor the
rights, powers and remedies conferred in respect of each Guarantor upon
any Finance Party by the Finance Documents or by law shall be
discharged, impaired or otherwise affected by:
20.4.1 the winding-up, dissolution, administration or re-organisation
of any Obligor or any other person or any change in its
status, function, control or ownership;
20.4.2 any of the obligations of any Obligor or any other person
under the Finance Documents or under any other security taken
in respect of any of its obligations under the Finance
Documents being or becoming illegal, invalid, unenforceable or
ineffective in any respect;
82
84
20.4.3 time or other indulgence being granted or agreed to be granted
to any Obligor or any other person in respect of its
obligations under the Finance Documents or under any such
other security;
20.4.4 any amendment to, or any variation, waiver or release of, any
obligation of any Obligor or any other person under the
Finance Documents or under any such other security;
20.4.5 any failure to take, or fully to take, any security
contemplated hereby or otherwise agreed to be taken in respect
of any Obligor's obligations under the Finance Documents;
20.4.6 any failure to realise or fully to realise the value of, or
any release, discharge, exchange or substitution of, any
security taken in respect of any Obligor's obligations under
the Finance Documents; or
20.4.7 any other act, event or omission which, but for this Clause
20.4, might operate to discharge, impair or otherwise affect
any of the obligations of each Guarantor herein contained or
any of the rights, powers or remedies conferred upon any of
the Finance Parties by the Finance Documents or by law.
20.5 SETTLEMENT CONDITIONAL
Any settlement or discharge between a Guarantor and any of the Finance
Parties shall be conditional upon no security or payment to any Finance
Party by an Obligor or any other person on behalf of an Obligor being
avoided or reduced by virtue of any laws relating to bankruptcy,
insolvency, liquidation or similar laws of general application and, if
any such security or payment is so avoided or reduced, each Finance
Party shall be entitled to recover the value or amount of such security
or payment from such Guarantor subsequently as if such settlement or
discharge had not occurred.
20.6 EXERCISE OF RIGHTS
No Finance Party shall be obliged before exercising any of the rights,
powers or remedies conferred upon them in respect of any Guarantor by
the Finance Documents or by law:
20.6.1 to make any demand of any Obligor (save where such demand is
expressly required by the terms of the Finance Documents);
20.6.2 to take any action or obtain judgment in any court against any
Obligor;
20.6.3 to make or file any claim or proof in a winding-up or
dissolution of any Obligor; or
20.6.4 to enforce or seek to enforce any other security taken in
respect of any of the obligations of any Obligor under the
Finance Documents.
83
85
20.7 DEFERRAL OF GUARANTORS' RIGHTS
Until all amounts which may be or become payable by the Borrowers under
or in connection with the Finance Documents have been irrevocably paid
in full and unless the Agent otherwise directs, no Guarantor will
exercise any rights which it may have by reason of performance by it of
its obligations under the Finance Documents:
20.7.1 to be indemnified by an Obligor; and/or
20.7.2 to claim any contribution from any other guarantor of any
obligations of the Borrower under the Finance Documents;
and/or
20.7.3 to take the benefit (in whole or in part and whether by way of
subrogation or otherwise) of any rights of the Finance Parties
under the Finance Documents or of any other guarantee or
security taken pursuant to, or in connection with, the Finance
Documents by any Finance Party.
20.8 APPROPRIATIONS
Until all amounts which may be or become payable by the Borrower under
or in connection with the Finance Documents have been irrevocably paid
in full, each Finance Party (or any trustee or agent on its behalf) may:
20.8.1 refrain from applying or enforcing any other moneys, security
or rights held or received by that Finance Party (or any
trustee or agent on its behalf) in respect of those amounts,
or apply and enforce the same in such manner and order as it
sees fit (whether against those amounts or otherwise) and no
Guarantor shall be entitled to the benefit of the same; and
20.8.2 hold in an interest-bearing suspense account any moneys
received from any Guarantor or on account of any Guarantor's
liability under this Clause 20 (Guarantee and Indemnity).
21. COMMITMENT COMMISSION AND FEES
21.1 COMMITMENT COMMISSION ON THE FACILITY
The Borrower shall pay to the Agent for the account of each Bank in
respect of each Commitment Period (as defined below) a commitment
commission calculated at the rate per annum of -3/4 of 1 per cent on an
amount equal to the average daily Available Commitments during such
Commitment Period.
21.2 DEFINITIONS AND AVERAGE CALCULATIONS
For the purposes of Clause 21.1 (Commitment Commission on the Facility):
21.2.1 "COMMITMENT PERIOD" means each successive period of three
months during the period beginning on the date hereof and
ending on the Final Maturity Date, PROVIDED THAT if the last
such period would otherwise extend beyond the Final Maturity
Date it shall be shortened so as to end on that date.
21.2.2 The average daily utilisation of the Facility during a
Commitment Period shall equal the sum of all Advances made by
the Banks and outstanding on each day during such Commitment
Period, divided by the number of days in such Commitment
Period.
84
86
21.2.3 The average daily Commitments during a Commitment Period shall
equal the aggregate of the Commitments on each day during such
Commitment Period divided by the number of days in such
Commitment Period.
21.2.4 The average daily Available Commitments during a Commitment
Period shall equal the aggregate of the Available Commitments
on each day during such Commitment Period divided by the
number of days in such Commitment Period.
21.3 PAYMENT OF COMMITMENT COMMISSION
The Agent shall promptly after the end of each Commitment Period notify
the Borrower and the Banks of the amounts payable by the Borrower under
Clause 21.1 (Commitment Commission on the Facility) in respect of such
Commitment Period and the Borrower shall pay such amount to the Agent
for account of the Banks pro rata to each Bank's Commitment hereunder
from time to time during the applicable Commitment Period within five
Business Days of such notification.
21.4 AGENCY AND OTHER FEES
The Borrower shall:
21.4.1 pay to the Agent for its own account the agency fees specified
in the letter dated 16 May 2000 from the Agent to NTL Inc. and
the Borrower at the times, and in the amounts, specified in
such letter; and
21.4.2 pay to the Arrangers the fees specified in the letters dated
17 May 2000 from the Arrangers to NTL Inc. and the Borrower
(and the attachments thereto) at the times, and in the
amounts, specified in such letters.
22. COSTS AND EXPENSES
22.1 TRANSACTION EXPENSES
The Borrower shall, from time to time on demand of the Agent, reimburse
each of the Agent and the Arrangers for all reasonable costs and
expenses (including legal fees) together with any VAT thereon incurred
by it in connection with the negotiation, preparation and execution of
the Finance Documents, any other document referred to in the Finance
Documents and the completion of the transactions therein contemplated.
22.2 PRESERVATION AND ENFORCEMENT OF RIGHTS
The Borrower shall, from time to time on demand of the Agent, reimburse
the Finance Parties for all costs and expenses (including legal fees) on
a full indemnity basis together with any VAT thereon incurred in or in
connection with the preservation and/or enforcement of any of the rights
of the Finance Parties under the Finance Documents and any document
referred to in the Finance Documents (including, without limitation, any
costs and expenses reasonably incurred in relation to any investigation
as to whether or not an Event of Default might have occurred or is
likely to occur or any steps necessary or desirable in connection with
any proposal for remedying or otherwise resolving an Event of Default or
Potential Event of Default).
85
87
22.3 STAMP TAXES
The Borrower shall pay all stamp, registration and other taxes to which
the Finance Documents or any judgment given in connection therewith is
or at any time may be subject and shall, from time to time on demand of
the Agent, indemnify the Finance Parties against any liabilities, costs,
claims and expenses resulting from any failure to pay or any delay in
paying any such tax.
22.4 AMENDMENT COSTS
If an Obligor requests any amendment, waiver or consent then the
Borrower shall, within five Business Days of demand by the Agent,
reimburse the Finance Parties for all costs and expenses (including
legal fees) together with any VAT thereon reasonably incurred by such
person in responding to or complying with such request.
22.5 BANKS' LIABILITIES FOR COSTS
If the Borrower fails to perform any of its obligations under this
Clause 22 (Costs and Expenses), each Bank shall, in its Proportion,
indemnify each of the Agent and the Arrangers against any loss incurred
by any of them as a result of such failure.
23. DEFAULT INTEREST AND BREAK COSTS
23.1 DEFAULT INTEREST PERIODS
If any sum due and payable by an Obligor hereunder is not paid on the
due date therefor in accordance with Clause 26 (Payments) or if any sum
due and payable by an Obligor under any judgment of any court in
connection herewith is not paid on the date of such judgment, the period
beginning on such due date or, as the case may be, the date of such
judgment and ending on the date upon which the obligation of such
Obligor to pay such sum is discharged shall be divided into successive
periods, each of which (other than the first) shall start on the last
day of the preceding such period and the duration of each of which shall
(except as otherwise provided in this Clause 23 (Default Interest and
Break Costs)) be selected by the Agent.
23.2 DEFAULT INTEREST
An Unpaid Sum shall bear interest during each Interest Period in respect
thereof at the rate per annum which is one per cent. per annum above the
percentage rate which would apply if such Unpaid Sum had been an Advance
in the amount and currency of such Unpaid Sum and for the same Interest
Period, PROVIDED THAT if such Unpaid Sum relates to an Advance which
became due and payable on a day other than the last day of an Interest
Period relating thereto:
23.2.1 the first Interest Period applicable to such Unpaid Sum shall
be of a duration equal to the unexpired portion of the current
Interest Period relating to that Advance; and
23.2.2 the percentage rate of interest applicable thereto from time
to time during such period shall be that which exceeds by one
per cent. the rate which would have been applicable to it had
it not so fallen due.
23.3 PAYMENT OF DEFAULT INTEREST
Any interest which shall have accrued under Clause 23.2 (Default
Interest) in respect of an Unpaid Sum shall be due and payable and shall
be paid by the Obligor owing such
86
88
Unpaid Sum on the last day of its Interest Period in respect thereof or
on such other dates as the Agent may specify by notice to such Obligor.
23.4 BREAK COSTS
If any Bank or the Agent on its behalf receives or recovers all or any
part of such Bank's share of an Advance or Unpaid Sum otherwise than on
the last day of the Interest Period relating thereto, the Borrower shall
pay to the Agent on demand for account of such Bank an amount equal to
the amount (if any) by which (a) the additional interest which would
have been payable on the amount so received or recovered had it been
received or recovered on the last day of that Interest Period exceeds
(b) the amount of interest which in the opinion of the Agent would have
been payable to the Agent on the last day of that Interest Period in
respect of a deposit in the currency of the amount so received or
recovered equal to the amount so received or recovered placed by it with
a prime bank in London for a period starting on the Business Day
following the date of such receipt or recovery and ending on the last
day of that Interest Period.
24. BORROWER'S INDEMNITIES
24.1 BORROWER'S INDEMNITY
The Borrower undertakes to indemnify:
24.1.1 each Finance Party against any cost, claim, loss, expense
(including legal fees) or liability together with any VAT
thereon, which it may sustain or incur as a consequence of the
occurrence of any Event of Default or any default by any
Obligor in the performance of any of the obligations expressed
to be assumed by it in the Finance Documents;
24.1.2 each Bank against any cost or loss it may suffer under Clause
22.5 (Banks' Liabilities for Costs) or Clause 29.6
(Indemnification); and
24.1.3 each Bank against any cost or loss it may suffer or incur as a
result of its funding or making arrangements to fund its
portion of an Advance requested by the Borrower but not made
by reason of the operation of any one or more of the
provisions hereof.
24.2 CURRENCY INDEMNITY
If any sum (a "SUM") due from an Obligor under the Finance Documents or
any order or judgment given or made in relation thereto has to be
converted from the currency (the "FIRST CURRENCY") in which such Sum is
payable into another currency (the "SECOND CURRENCY") for the purpose
of:
24.2.1 making or filing a claim or proof against such Obligor;
24.2.2 obtaining or enforcing an order or judgment in any court or
other tribunal,
the Borrower shall indemnify each person to whom such Sum is due from
and against any loss suffered or incurred as a result of any discrepancy
between (a) the rate of exchange used for such purpose to convert such
Sum from the First Currency into the Second Currency and (b) the rate or
rates of exchange available to such person at the time of receipt of
such Sum.
87
89
25. CURRENCY OF ACCOUNT AND PAYMENT
Sterling is the currency of account and payment for each and every sum
at any time due from an Obligor hereunder, PROVIDED THAT:
25.1.1 each payment in respect of costs and expenses shall be made in
the currency in which the same were incurred; and
25.1.2 each payment pursuant to Clause 10.2 (Tax Indemnity), Clause
12.1 (Increased Costs) or Clause 24 (Borrowers Indemnities)
shall be made in the currency specified by the party claiming
thereunder.
26. PAYMENTS
26.1 NOTIFICATION OF PAYMENTS
Without prejudice to the liability of each party hereto promptly to pay
each amount owing by it hereunder on the due date therefor, whenever a
payment is expected to be made by any of the parties hereto, the Agent
shall, at least two Business Days prior to the expected date for such
payment, notify all the parties hereto of the amount, currency and
timing of such payment and the identity of the party liable to make such
payment.
26.2 PAYMENTS TO THE AGENT
On each date on which this Agreement requires an amount to be paid by an
Obligor or a Bank, such Obligor or, as the case may be, such Bank shall
make the same available to the Agent for value on the due date at such
time and in such funds and to such account with such bank as the Agent
shall (acting reasonably) specify from time to time.
26.3 PAYMENTS BY THE AGENT
26.3.1 Save as otherwise provided herein, each payment received by
the Agent pursuant to Clause 26.2 (Payments to the Agent)
shall:
(a) in the case of a payment received for the account of the
Borrower, be made available by the Agent to the Borrower
by application:
(i) FIRST, in or towards payment on the same day of
any amount then due from the Borrower hereunder
to the person from whom the amount was so
received; and
(ii) SECONDLY, in or towards payment on the same day
to the account of the Borrower with such bank
in London as the Borrower shall have previously
notified to the Agent for this purpose; and
(b) in the case of any other payment, be made available by
the Agent to the person entitled to receive such payment
in accordance with this Agreement (in the case of a
Bank, for the account of its Facility Office) for value
the same day by transfer to such account of such person
with such bank in London as such person shall have
previously notified to the Agent.
26.3.2 A payment will be deemed to have been made by the Agent on the
date on which it is required to be made under this Agreement
if the Agent has, on or before that date, taken steps to make
that payment in accordance with the
88
90
regulations or operating procedures of the clearing or
settlement system used by the Agent in order to make the
payment.
26.4 NO SET-OFF
All payments required to be made by an Obligor hereunder shall be
calculated without reference to any set-off or counterclaim and shall be
made free and clear of and without any deduction for or on account of
any set-off or counterclaim.
26.5 CLAWBACK
Where a sum is to be paid hereunder to the Agent for account of another
person, the Agent shall not be obliged to make the same available to
that other person until it has been able to establish to its
satisfaction that it has actually received such sum, but if it does so
and it proves to be the case that it had not actually received such sum,
then the person to whom such sum was so made available shall on request
refund the same to the Agent together with an amount sufficient to
indemnify the Agent against any cost or loss it may have suffered or
incurred by reason of its having paid out such sum prior to its having
received such sum.
26.6 PARTIAL PAYMENTS
If and whenever a payment is made by an Obligor hereunder and the Agent
receives an amount less than the due amount of such payment the Agent
may apply the amount received towards the obligations of the Obligors
under this Agreement in the following order:
26.6.1 FIRST, in or towards payment of any unpaid costs and expenses
of the Agent;
26.6.2 SECONDLY, in or towards payment pro rata of any accrued
interest or commitment commission due but unpaid;
26.6.3 THIRDLY, in or towards payment pro rata of any principal due
but unpaid; and
26.6.4 FOURTHLY, in or towards payment pro rata of any other sum due
but unpaid.
26.7 VARIATION OF PARTIAL PAYMENTS
The order of partial payments set out in Clause 26.6 (Partial Payments)
shall override any appropriation made by the Obligor to which the
partial payment relates but the order set out in sub-clauses 26.6.2,
26.6.3 and 26.6.4 of Clause 26.6 (Partial Payments) may be varied if
agreed by all the Banks.
26.8 BUSINESS DAYS
26.8.1 Any payment which is due to be made on a day that is not a
Business Day shall be made on the next Business Day in the
same calendar month (if there is one) or the preceding
Business Day (if there is not).
26.8.2 During any extension of the due date for payment of any
principal or an Unpaid Sum under this Agreement interest is
payable on the principal at the rate payable on the original
due date.
89
91
27. SET-OFF
27.1 CONTRACTUAL SET-OFF
Each Obligor authorises each Bank, at any time any sum is due and
payable hereunder and remains unpaid, to apply any credit balance to
which such Obligor is entitled on any account of such Obligor with such
Bank in satisfaction of any sum due and payable from such Obligor to
such Bank under the Finance Documents but unpaid. For this purpose, each
Bank is authorised to purchase with the moneys standing to the credit of
any such account such other currencies as may be necessary to effect
such application.
27.2 SET-OFF NOT MANDATORY
No Bank shall be obliged to exercise any right given to it by Clause
28. SHARING
28.1 PAYMENTS TO BANKS
If a Bank (a "RECOVERING BANK") applies any receipt or recovery from an
Obligor to a payment due under this Agreement and such amount is
received or recovered other than in accordance with Clause 26
(Payments), then such Recovering Bank shall:
28.1.1 notify the Agent of such receipt or recovery;
28.1.2 at the request of the Agent, promptly pay to the Agent an
amount (the "SHARING PAYMENT") equal to such receipt or
recovery less any amount which the Agent determines may be
retained by such Recovering Bank as its share of any payment
to be made in accordance with Clause 26.6 (Partial Payments).
28.2 REDISTRIBUTION OF PAYMENTS
The Agent shall treat the Sharing Payment as if it had been paid by the
relevant Obligor and distribute it between the Finance Parties (other
than the Recovering Bank) in accordance with Clause 26.6 (Partial
Payments).
28.3 RECOVERING BANK'S RIGHTS
The Recovering Bank will be subrogated into the rights of the parties
which have shared in a redistribution pursuant to Clause 28.2
(Redistribution of Payments) in respect of the Sharing Payment (and the
relevant Obligor shall be liable to the Recovering Bank in an amount
equal to the Sharing Payment).
28.4 REPAYABLE RECOVERIES
If any part of the Sharing Payment received or recovered by a Recovering
Bank becomes repayable and is repaid by such Recovering Bank, then:
28.4.1 each party which has received a share of such Sharing Payment
pursuant to Clause 28.2 (Redistribution of Payments) shall,
upon request of the Agent, pay to the Agent for account of
such Recovering Bank an amount equal to its share of such
Sharing Payment; and
28.4.2 such Recovering Bank's rights of subrogation in respect of any
reimbursement shall be cancelled and the relevant Obligor will
be liable to the reimbursing party for the amount so
reimbursed.
90
92
28.5 EXCEPTION
This Clause 28 (Sharing) shall not apply if the Recovering Bank would
not, after making any payment pursuant hereto, have a valid and
enforceable claim against the relevant Obligor.
28.6 RECOVERIES THROUGH LEGAL PROCEEDINGS
If any Bank intends to commence any action in any court it shall give
prior notice to the Agent and the other Banks. If any Bank shall
commence any action in any court to enforce its rights hereunder and, as
a result thereof or in connection therewith, receives any amount, then
such Bank shall not be required to share any portion of such amount with
any Bank which has the legal right to, but does not, join in such action
or commence and diligently prosecute a separate action to enforce its
rights in another court.
29. THE AGENT, THE ARRANGERS AND THE BANKS
29.1 APPOINTMENT OF THE AGENT
Each of the Arrangers and the Banks hereby appoints the Agent to act as
its agent in connection herewith and authorises the Agent to exercise
such rights, powers, authorities and discretions as are specifically
delegated to the Agent by the terms hereof together with all such
rights, powers, authorities and discretions as are reasonably incidental
thereto.
29.2 AGENT'S DISCRETIONS
The Agent may:
29.2.1 assume, unless it has, in its capacity as agent for the Banks,
received notice to the contrary from any other party hereto,
that (a) any representation made or deemed to be made by an
Obligor in connection with the Finance Documents is true, (b)
no Event of Default or Potential Event of Default has
occurred, (c) any Obligor is in breach of or default under its
obligations under the Finance Documents and (d) any right,
power, authority or discretion vested herein upon an
Instructing Group, the Banks or any other person or group of
persons has not been exercised;
29.2.2 assume that (a) the Facility Office of each Bank is that
notified to it by such Bank in writing and (b) the information
provided by each Bank pursuant to Clause 34 (Notices), Clause
29.15 (Banks' Mandatory Cost Details) and Schedule 7
(Mandatory Costs) is true and correct in all respect until it
has received from such Bank notice of a change to the Facility
Office or any such information and act upon any such notice
until the same is superseded by a further notice;
29.2.3 engage and pay for the advice or services of any lawyers,
accountants, surveyors or other experts whose advice or
services may to it seem necessary, expedient or desirable and
rely upon any advice so obtained;
29.2.4 rely as to any matters of fact which might reasonably be
expected to be within the knowledge of an Obligor upon a
certificate signed by or on behalf of such Obligor;
91
93
29.2.5 rely upon any communication or document believed by it to be
genuine;
29.2.6 refrain from exercising any right, power or discretion vested
in it as agent hereunder unless and until instructed by an
Instructing Group as to whether or not such right, power or
discretion is to be exercised and, if it is to be exercised,
as to the manner in which it should be exercised;
29.2.7 refrain from acting in accordance with any instructions of an
Instructing Group to begin any legal action or proceeding
arising out of or in connection with the Finance Documents
until it shall have received such security as it may require
(whether by way of payment in advance or otherwise) for all
costs, claims, losses, expenses (including legal fees) and
liabilities together with any VAT thereon which it will or may
expend or incur in complying with such instructions.
29.2.8 assume (unless it has specific notice to the contrary) that
any notice or request made by the Borrower is made on behalf
of all the Obligors.
29.3 AGENT'S OBLIGATIONS
The Agent shall:
29.3.1 promptly inform each Bank of the contents of any written
notice or document received by it in its capacity as Agent
from an Obligor under the Finance Documents;
29.3.2 promptly notify each Bank of the occurrence of any Event of
Default or any default by an Obligor in the due performance of
or compliance with its obligations under the Finance Documents
of which the Agent has notice from any other party hereto;
29.3.3 promptly notify each Bank of the occurrence of an Event of
Default under Clause 19.1 (Failure to Pay);
29.3.4 promptly notify each Bank of all or any part of the Advances
being declared to be immediately due and payable in accordance
with either Clause 19.16 (Acceleration and Cancellation) or
Clause 19.17 (Advances Due on Demand);
29.3.5 save as otherwise provided herein, act as agent hereunder in
accordance with any instructions given to it by an Instructing
Group, which instructions shall be binding on the Arrangers
and the Banks;
29.3.6 if so instructed by an Instructing Group, refrain from
exercising any right, power or discretion vested in it as
agent hereunder; and
29.3.7 unless it has a Bank's consent, refrain from acting on behalf
of that Bank in any legal or arbitration proceedings relating
to any Finance Document.
The Agent's duties under the Finance Documents are solely mechanical
and administrative in nature.
92
94
29.4 EXCLUDED OBLIGATIONS
Notwithstanding anything to the contrary expressed or implied herein,
neither the Agent nor an Arranger shall:
29.4.1 be bound to enquire as to (a) whether or not any
representation made or deemed to be made by an Obligor in
connection with the Finance Documents is true, (b) the
occurrence or otherwise of any Event of Default or Potential
Event of Default, (c) the performance by an Obligor of its
obligations under the Finance Documents or (d) any breach of
or default by an Obligor of or under its obligations under the
Finance Documents;
29.4.2 be bound to account to any Bank for any sum or the profit
element of any sum received by it for its own account;
29.4.3 be bound to disclose to any other person any information
relating to any member of the Group if (a) such information is
confidential or (b) such disclosure would or might in its
reasonable opinion constitute a breach of any law or a breach
of fiduciary duty;
29.4.4 be under any obligations other than those for which express
provision is made herein; or
29.4.5 be or be deemed to be a fiduciary for any other party hereto.
29.5 DELEGATION
The Agent may delegate, transfer or assign to any of its holding
companies, subsidiaries or subsidiaries of any of its holding companies
all or any of the rights, powers, authorities and discretions vested in
it under the Finance Documents and the performance of its duties in
accordance therewith, and such delegation, transfer or assignment may be
made upon such terms and subject to such conditions (including the power
to sub-delegate) and subject to such regulations as the Agent may think
fit (and the term "Agent" as used in this Agreement shall include any
such delegate).
29.6 INDEMNIFICATION
Each Bank shall, in its Proportion, from time to time on demand by the
Agent, indemnify the Agent against any and all costs, claims, losses,
expenses (including legal fees) and liabilities together with any VAT
thereon which the Agent may incur, otherwise than by reason of its own
gross negligence or wilful misconduct, in acting in its capacity as
agent under the Finance Documents (other than any which have been
reimbursed by the Borrower pursuant to Clause 24.1 (Borrowers'
Indemnity)).
29.7 EXCLUSION OF LIABILITIES
Each Bank confirms that it has read the Notice to Recipients in the
Information Memorandum, that it has complied with the Recipients'
Obligations (as set out in the Notice to Recipients) and, accordingly,
that it enters into this Agreement on the basis of the Notice to
Recipients. In particular, each of the Banks accepts that it is entering
into this Agreement in reliance only on the representations of the
Obligors in this Agreement and on its own investigations, that it has
not relied on the Arrangers and that, except as set out below, it
neither has nor will have any claims against the Arrangers arising from
or in connection with this Agreement. Similarly, each of the Banks
accepts that the
93
95
Notice to Recipients in the Information Memorandum is applicable also
to the Agent as if the Agent had been named in addition to the
Arrangers in the Important Notice.
Except in the case of gross negligence or wilful default, neither the
Agent nor any Arranger accepts any responsibility to any of the Banks:
29.7.1 for the adequacy, accuracy and/or completeness of the
Information Memorandum or any other information supplied by
the Agent or the Arrangers, by an Obligor or by any other
person in connection with the Finance Documents or any other
agreement, arrangement or document entered into, made or
executed in anticipation of, pursuant to or in connection with
the Finance Documents;
29.7.2 for the legality, validity, effectiveness, adequacy or
enforceability of the Finance Documents or any other
agreement, arrangement or document entered into, made or
executed in anticipation of, pursuant to or in connection with
the Finance Documents; or
29.7.3 for the exercise of, or the failure to exercise, any
judgement, discretion or power given to any of them by or in
connection with the Finance Documents or any other agreement,
arrangement or document entered into, made or executed in
anticipation of, pursuant to or in connection with the Finance
Documents.
Accordingly, neither the Agent nor an Arranger shall be under any
liability (whether in negligence or otherwise) in respect of such
matters, save in the case of gross negligence or wilful misconduct.
29.8 NO ACTIONS
Each of the Banks agrees that it will not assert or seek to assert
against any director, officer or employee of the Agent or the Arrangers
any claim it might have against any of them in respect of the matters
referred to in Clause 29.7 (Exclusion of Liabilities).
29.9 BUSINESS WITH THE GROUP
The Agent and the Arrangers may accept deposits from, lend money to and
generally engage in any kind of banking or other business with any
member of the Group whether or not it may or does lead to a conflict
with the interests of any of the Banks. Similarly, the Agent or the
Arrangers may undertake business with or for others even though it may
lead to a conflict with the interests of any of the Banks.
29.10 RESIGNATION
The Agent may resign its appointment hereunder at any time without
assigning any reason therefor by giving not less than thirty days' prior
notice to that effect to each of the other parties hereto, PROVIDED THAT
no such resignation shall be effective until a successor for the Agent
is appointed in accordance with the succeeding provisions of this Clause
29 (The Agent, the Arrangers and the Banks).
94
96
29.11 REMOVAL OF AGENT
An Instructing Group may, after consultation with the Borrower, remove
the Agent from its role as agent under the Finance Documents by giving
notice to that effect to each of the other parties hereto. Such removal
shall take effect only when a successor to the Agent is appointed in
accordance with the terms of the Finance Documents.
29.12 SUCCESSOR AGENT
If the Agent gives notice of its resignation pursuant to Clause 29.10
(Resignation) or it is removed pursuant to Clause 29.11 (Removal of
Agent), then any reputable and experienced bank or other financial
institution may, with the prior consent of the Borrower be appointed as
a successor to the Agent by an Instructing Group during the period of
such notice but, if no such successor is so appointed, the Agent may
appoint such a successor itself.
29.13 RIGHTS AND OBLIGATIONS
If a successor to the Agent is appointed under the provisions of Clause
29.12 (Successor Agent), then (a) the retiring or departing Agent shall
be discharged from any further obligation under the Finance Documents
but shall remain entitled to the benefit of the provisions of this
Clause 29 (The Agent, the Arrangers and the Banks) and (b) its successor
and each of the other parties hereto shall have the same rights and
obligations amongst themselves as they would have had if such successor
had been a party hereto.
29.14 OWN RESPONSIBILITY
It is understood and agreed by each Bank that at all times it has itself
been, and will continue to be, solely responsible for making its own
independent appraisal of and investigation into all risks arising under
or in connection with the Finance Documents including, but not limited
to:
29.14.1 the financial condition, creditworthiness, condition, affairs,
status and nature of each member of the Group;
29.14.2 the legality, validity, effectiveness, adequacy and
enforceability of the Finance Documents and any other
agreement, arrangement or document entered into, made or
executed in anticipation of, pursuant to or in connection with
the Finance Documents;
29.14.3 whether such Bank has recourse, and the nature and extent of
that recourse, against an Obligor or any other person or any
of their respective assets under or in connection with the
Finance Documents, the transactions therein contemplated or
any other agreement, arrangement or document entered into,
made or executed in anticipation of, pursuant to or in
connection with the Finance Documents; and
29.14.4 the adequacy, accuracy and/or completeness of the Information
Memorandum and any other information provided by the Agent or
the Arrangers or an Obligor or by any other person in
connection with the Finance Documents, the transactions
contemplated therein or any other agreement, arrangement or
document entered into, made or executed in anticipation of,
pursuant to or in connection with the Finance Documents.
95
97
Accordingly, each Bank acknowledges to the Agent and the Arrangers that
it has not relied on and will not hereafter rely on the Agent and the
Arrangers or any of them in respect of any of these matters.
29.15 BANKS' MANDATORY COST DETAILS
Each Bank will supply the Agent with such information and in such detail
as the Agent may require in order to calculate the Mandatory Cost Rate
in accordance with Schedule 7 (Mandatory Costs).
29.16 RECEIPT OF INFORMATION BY THE AGENT
Any information or document received by the Agent shall only be treated
as having been received by the Agent if the same has been delivered to
the Agent's agency department in accordance with Clause 34 (Notices).
Accordingly, any information or documents received by the Agent other
than by its agency department in accordance with Clause 34 (Notices) is
not by reason of that receipt to be treated as having been received by
the Agent unless and until the Agent's agency department has received
actual notice of the same in accordance with such Clause. Save as
expressly set out in this Agreement and, unless the Agent's agency
department shall have received information or documents in accordance
with Clause 34 (Notices) the Agent shall have no duty to disclose, and
shall not be liable for the failure to disclose, any information or
documents, that are communicated to or obtained by the Agent.
30. ASSIGNMENTS AND TRANSFERS
30.1 BINDING AGREEMENT
The Finance Documents shall be binding upon and enure to the benefit of
each party hereto and its or any subsequent successors and Transferees.
30.2 NO ASSIGNMENTS AND TRANSFERS BY NTL
No Obligor shall be entitled to assign or transfer all or any of its
rights, benefits and obligations under the Finance Documents, other than
as permitted pursuant to the terms of this Agreement.
30.3 ASSIGNMENT AND TRANSFERS BY BANKS
30.3.1 Any Bank may, at any time, assign all or any of its rights and
benefits hereunder or transfer in accordance with Clause 30.5
(Transfers by Banks) all or any of its rights, benefits and
obligations hereunder to, or enter into any form of
sub-participation agreement with, a bank or financial
institution, provided that such Bank procures that the
assignee or Transferee executes and delivers to the Agent an
Intercreditor Accession Deed in the form attached to the
Intercreditor Agreement.
30.3.2 The prior written consent of the Borrower (which shall be
deemed to be given on its own behalf and on behalf of the
other Obligors) is required for an assignment or transfer by a
Bank unless the assignment or transfer is to:
(a) another Bank; or
(b) any subsidiary or holding company (or to any subsidiary
of any holding company) of the transferring Bank.
96
98
30.3.3 The Borrower's consent must not be (a) unreasonably delayed or
withheld or (b) withheld solely because the assignment or
transfer may result in an increase to the Mandatory Cost Rate.
30.4 ASSIGNMENTS BY BANKS
If any Bank assigns all or any of its rights and benefits under the
Finance Documents in accordance with Clause 30.3 (Assignments and
Transfers by Banks), then, unless and until the assignee has delivered a
notice to the Agent confirming in favour of the Agent, the Arrangers and
the other Banks that it shall be under the same obligations towards each
of them as it would have been under if it had been an original party
hereto as a Bank (whereupon such assignee shall become a party hereto as
a "BANK"), the Agent, the Arrangers and the other Banks shall not be
obliged to recognise such assignee as having the rights against each of
them which it would have had if it had been such a party hereto.
30.5 TRANSFERS BY BANKS
If any Bank wishes to transfer all or any of its rights, benefits and/or
obligations under the Finance Documents as contemplated in Clause 30.3
(Assignments and Transfers by Banks), then such transfer may be effected
by the delivery to the Agent of a duly completed Transfer Certificate
executed by such Bank and the relevant Transferee in which event, on the
later of the Transfer Date specified in such Transfer Certificate and
the fifth Business Day after (or such earlier Business Day endorsed by
the Agent on such Transfer Certificate falling on or after) the date of
delivery of such Transfer Certificate to the Agent:
30.5.1 to the extent that in such Transfer Certificate the Bank party
thereto seeks to transfer by novation its rights, benefits and
obligations under the Finance Documents, each of the Obligors
and such Bank shall be released from further obligations
towards one another under the Finance Documents and their
respective rights against one another shall be cancelled (such
rights and obligations being referred to in this Clause 30.5
(Transfer by Banks) as "DISCHARGED RIGHTS AND OBLIGATIONS");
30.5.2 each of the Obligors and the Transferee party thereto shall
assume obligations towards one another and/or acquire rights
against one another which differ from such discharged rights
and obligations only insofar as the Obligors and such
Transferee have assumed and/or acquired the same in place of
the Obligors and such Bank;
30.5.3 the Agent, the Arrangers, such Transferee and the other Banks
shall acquire the same rights and benefits and assume the same
obligations between themselves as they would have acquired and
assumed had such Transferee been an original party hereto as a
Bank with the rights, benefits and/or obligations acquired or
assumed by it as a result of such transfer and to that extent
the Agent, the Arrangers and the relevant Bank shall each be
released from further obligations to each other under the
Finance Documents; and
30.5.4 such Transferee shall become a party hereto as a "BANK".
97
99
30.6 U.S. TAX FORMS
At the time of a Transfer or Assignment pursuant to Clause 30.3
(Assignment and Transfers by Banks) to a person which is not already a
Bank hereunder and which is not a United States person (as such term is
defined in Section 7701(a)(30) of the Internal Revenue Code) for U.S.
federal income tax purposes, the Transferee or assignee Bank must
provide the appropriate Internal Revenue Service Forms (and, if
applicable, a Non-Bank Certificate) described in Clause 10.4 (U.S. Tax
Forms).
30.7 NO INCREASED OBLIGATIONS
If:
30.7.1 a Bank assigns or transfers any of its rights or obligations
under the Finance Documents or changes its Facility Office;
and
30.7.2 as a result of circumstances existing at the date of the
assignment, transfer or change of Facility Office, an Obligor
would be obliged to make a payment to the assignee, Transferee
or the Bank acting through its new Facility Office under
Clause 10.1 (Tax Gross-up), Clause 10.2 (Tax Indemnity) or
Clause 12 (Increased Costs),
then the assignee, Transferee or the Bank acting through its new
Facility Office shall only be entitled to receive payment under those
Clauses to the same extent as the assignor, transferor or the Bank
acting through its previous Facility Office would have been if the
assignment, transfer or change had not occurred.
30.8 ASSIGNMENT AND TRANSFER FEES
On the date upon which an assignment takes effect pursuant to Clause
30.4 (Assignments by Banks) or a transfer takes effect pursuant to
Clause 30.5 (Transfers by Banks), in each case where such assignment or
transfer takes effect after the Syndication Date, the relevant assignee
or Transferee shall pay to the Agent for its own account a fee of
L1,000.
30.9 DISCLOSURE OF INFORMATION
Any Bank may disclose to any person:
30.9.1 to (or through) whom such Bank assigns or transfers (or may
potentially assign or transfer) all or any of its rights,
benefits and obligations under the Finance Documents;
30.9.2 with (or through) whom such Bank enters into (or may
potentially enter into) any sub-participation in relation to,
or any other transaction under which payments are to be made
by reference to, the Finance Documents or any Obligor;
30.9.3 to whom information may be required to be disclosed by any
applicable law; or
30.9.4 any of its subsidiaries or any holding company (or any
subsidiary of a holding company),
such information about any Obligor or the Group and the Finance
Documents as such Bank shall consider appropriate PROVIDED THAT, in
relation to sub-clauses 30.9.1 and
98
100
30.9.2, the person to whom such information is to be given has entered
into a Confidentiality Undertaking. Any Bank which discloses any such
information to any of the persons referred to in sub-clause 30.9 shall
procure that those persons keep the information they receive
confidential (save for disclosures they are required to make by any
applicable law).
30.10 NOTIFICATION
The Agent shall within fourteen days of receiving a Transfer Certificate
or a notice relating to an assignment pursuant to Clause 30.4
(Assignment by Banks) notify the Borrower (on its own behalf and on
behalf of the other Obligors) of any assignment or transfer completed
pursuant to this Clause 30 (Assignments and Transfers).
30.11 XXXXXX XXXXXXX COMMITMENT
References to the Commitment of Xxxxxx Xxxxxxx Xxxx Xxxxxx Bank Limited
in relation to the Facility shall be construed as references to the
aggregate Commitment in relation to the Facility of Xxxxxx Xxxxxxx Xxxx
Xxxxxx Bank Limited and Xxxxxx Xxxxxxx Senior Funding, Inc., in such
proportions as Xxxxxx Xxxxxxx Xxxx Xxxxxx Bank Limited notifies to the
Agent from time to time and Xxxxxx Xxxxxxx Senior Funding, Inc. is a
party to this Agreement to give effect to such Commitment (as so
notified).
31. ECONOMIC AND MONETARY UNION
31.1 ECONOMIC AND MONETARY UNION
If the United Kingdom becomes a Participating Member State and as a
result the Bank of England recognises more than one currency or currency
unit as the lawful currency of the United Kingdom:
31.1.1 (unless prohibited by law) the Agent may designate (after
consultation with the Borrower) which currency or currency
unit the obligations arising under the Finance Documents are
to be denominated or payable in;
31.1.2 (unless prohibited by law) any translation from currency or
currency unit to another shall be at the official rate of
exchange recognised by the Bank of England for conversion,
rounded up or down by the Agent (acting reasonably); and
31.1.3 the Finance Documents shall be subject to such reasonable
changes of construction as the Agent may specify from time to
time to be appropriate to reflect the adoption of the euro in
the United Kingdom and any relevant market conventions or
practices relating to the euro.
(b) any amount payable by the Agent to the Banks under the Finance
Document shall be paid in the euro unit.
31.2 INCREASED COSTS
The Borrower shall, from time to time on demand of the Agent, pay to the
Agent for the account of such Bank the amount of any cost or increased
cost incurred by, or of any reduction in any amount payable to or in the
effective return on its capital to, or of interest or other return
foregone by, a Bank or any holding company of such Bank as a result of
the introduction of, changeover to or operation of the euro in the
United
99
101
Kingdom, other than any such cost or reduction or amount foregone
reflected in the Mandatory Cost Rate.
32. CALCULATIONS AND EVIDENCE OF DEBT
32.1 BASIS OF ACCRUAL
Interest and commitment commission shall accrue from day to day and
shall be calculated on the basis of a year of 365 days (or, in any case
where market practice differs, in accordance with market practice) and
the actual number of days elapsed.
32.2 QUOTATIONS
If on any occasion a Reference Bank or Bank fails to supply the Agent
with a quotation required of it under the foregoing provisions of this
Agreement, the rate for which such quotation was required shall be
determined from those quotations which are supplied to the Agent,
PROVIDED THAT, in relation to determining LIBOR, this Clause 32.2 shall
not apply if only one Reference Bank supplies a quotation.
32.3 EVIDENCE OF DEBT
Each Bank shall maintain in accordance with its usual practice accounts
evidencing the amounts from time to time lent by and owing to it
hereunder.
32.4 CONTROL ACCOUNTS
The Agent shall maintain on its books a control account or accounts in
which shall be recorded (a) the amount of any Advance or any Unpaid Sum
and each Bank's share therein, (b) the amount of all principal, interest
and other sums due or to become due from an Obligor and each Bank's
share therein and (c) the amount of any sum received or recovered by the
Agent hereunder and each Bank's share therein.
32.5 PRIMA FACIE EVIDENCE
In any legal action or proceeding arising out of or in connection with
this Agreement, the entries made in the accounts maintained pursuant to
Clause 32.3 (Evidence of Debt) and Clause 32.4 (Control Accounts) shall
be prima facie evidence of the existence and amounts of the specified
obligations of the Obligors.
32.6 CERTIFICATES OF BANKS
A certificate of a Bank as to (a) the amount by which a sum payable to
it hereunder is to be increased under Clause 10.1 (Tax Gross-up), (b)
the amount for the time being required to indemnify it against any such
cost, payment or liability as is mentioned in Clause 10.2 (Tax
Indemnity), Clause 12.1 (Increased Costs) or Clause 24.1 (Borrower's
Indemnity) or (c) the amount of any credit, relief, remission or
repayment as is mentioned in Clause 11.3 (Tax Credit Payment) or Clause
11.4 (Tax Credit Clawback) shall, in the absence of manifest error, be
prima facie evidence of the existence and amounts of the specified
obligations of the Obligors.
32.7 AGENT'S CERTIFICATES
A certificate of the Agent as to the amount at any time due from a
Borrower hereunder or the amount which, but for any of the obligations
of such Borrower hereunder being or becoming void, voidable,
unenforceable or ineffective, at any time would have been due from such
Borrower hereunder shall, in the absence of manifest error, be
conclusive for the purposes of Clause 20 (Guarantee and Indemnity).
100
102
33. REMEDIES AND WAIVERS, PARTIAL INVALIDITY
33.1 REMEDIES AND WAIVERS
No failure to exercise, nor any delay in exercising, on the part of any
Finance Party, any right or remedy under the Finance Documents shall
operate as a waiver thereof, nor shall any single or partial exercise of
any right or remedy prevent any further or other exercise thereof or the
exercise of any other right or remedy. The rights and remedies herein
provided are cumulative and not exclusive of any rights or remedies
provided by law.
33.2 PARTIAL INVALIDITY
If, at any time, any provision of the Finance Documents is or becomes
illegal, invalid or unenforceable in any respect under the law of any
jurisdiction, neither the legality, validity or enforceability of the
remaining provisions thereof nor the legality, validity or
enforceability of such provision under the law of any other jurisdiction
shall in any way be affected or impaired thereby.
34. NOTICES
34.1 COMMUNICATIONS IN WRITING
Each communication to be made under the Finance Documents shall be made
in writing and, unless otherwise stated, shall be made by fax or letter.
34.2 ADDRESSES
Any communication or document to be made or delivered pursuant to the
Finance Documents shall be made or delivered to the address or fax
number (and the department or officer, if any, for whose attention the
communication is made):
34.2.1 in the case of an Obligor, the Security Trustee and the Agent,
identified with its name below; and
34.2.2 in the case of each Bank, notified in writing to the Agent
prior to the date hereof (or, in the case of a Transferee, at
the end of the Transfer Certificate to which it is a party as
Transferee); and
or to any substitute address, fax number or department or officer as the
Security Trustee, an Obligor or a Bank may notify to the Agent (or the
Agent may notify to the Borrower (on its own behalf and on behalf of the
other Obligors), the Security Trustee and the Banks, if a change is made
by the Agent) by not less than five Business Days' Borrower notice. Any
communication to be made to an Obligor (other than the Borrower) by fax
shall be made to the fax number identified with the Borrower name below.
Any communication or document to be made or delivered (a) to an Obligor
(other than the Borrower) shall be copied to the Borrower and (b) to any
Obligor (other than the Parent) to the Parent.
34.3 DELIVERY
Any communication or document to be made or delivered by one person to
another under or in connection with the Finance Documents shall only be
effective:
34.3.1 if by way of fax, when received in legible form;
101
103
34.3.2 if by way of letter, when left at the relevant address or, as
the case may be, five days after being deposited in the post
postage prepaid in an envelope addressed to it at such
address; and
34.3.3 if a particular department or officer is specified as part of
the address details provided under Clause 34.2 (Addresses), if
addressed to that department or officer,
PROVIDED THAT any communication or document to be made or delivered to
the Agent shall be effective only when received by its agency division
and then only if the same is expressly marked for the attention of the
department or officer identified with the Agent's signature below (or
such other department or officer as the Agent shall from time to time
specify for this purpose).
34.4 THE AGENT
All notices from or to an Obligor shall be sent through the Agent.
34.5 ENGLISH LANGUAGE
Each communication and document made or delivered by one party to
another pursuant to the Finance Documents shall be in the English
language or accompanied by a translation thereof into English certified
(by an officer of the person making or delivering the same) as being a
true and accurate translation thereof.
34.6 NOTIFICATION OF CHANGES
Promptly upon receipt of notification of a change of address or fax
number pursuant to Clause 34.2 (Addresses) or changing its own address
or fax number the Agent shall notify the other parties hereto of such
change.
34.7 DEEMED RECEIPT BY THE OBLIGORS
Any communication or document made or delivered to the Borrower in
accordance with Clause 34.3 (Delivery) shall be deemed to have been made
or delivered to each of the Obligors.
35. COUNTERPARTS
This Agreement may be executed in any number of counterparts, all of
which taken together shall constitute one and the same instrument.
36. AMENDMENTS
36.1 AMENDMENTS
If the Agent has the prior consent of an Instructing Group (or the
Steering Committee Group is so provided under Clause 36.4 (Amendments
Requiring the Consent of the Steering Committee Group), the Agent, the
Borrower and the Obligors party to a Finance Document may from time to
time agree in writing to amend such Finance Document or, as the case may
be, the Agent may consent to or waive, prospectively or retrospectively,
any of the requirements of such Finance Document and any amendments or
waivers so agreed or consents so given shall be binding on all the
Finance Parties, PROVIDED THAT no such waiver or amendment shall subject
any Finance Party hereto to any new or additional obligations without
the consent of such Finance Party.
102
104
36.2 AMENDMENTS REQUIRING THE CONSENT OF ALL THE BANKS
An amendment or waiver which relates to:
36.2.1 Clause 28 (Sharing) or this Clause 36.1 (Amendments);
36.2.2 a change in the principal amount of or currency of any
Advance, or deferral of the Final Maturity Date;
36.2.3 a change in the Margin, the amount of any payment of interest,
fees or any other amount payable hereunder to any Finance
Party or deferral of the date for payment thereof;
36.2.4 Clause 20 (Guarantee and Indemnity);
36.2.5 a release of any of the Security;
36.2.6 a Security Document, where such an amendment or waiver could
affect the nature or scope of the property subject to the
Security;
36.2.7 an increase in the commitment of a Bank;
36.2.8 a change to the Borrower or Guarantors;
36.2.9 Clause 2.5 (Banks' Obligations Several), Clause 2.6 (Banks'
Rights Several);
36.2.10 the conditions set out in sub-clause 3.1.7 of Clause 3.1
(Drawdown Conditions for Advances) if an Event of Default or
Potential Event of Default which relates to a Repeated
Representation or Clause 18.18 (Negative Pledge) is
continuing;
36.2.11 the definition of Instructing Group, Permitted Encumbrance or
Potential Event of Default; or
36.8.12 any provision which contemplates the need for the consent or
approval of all the Banks,
shall not be made without the prior consent of all the Banks.
36.3 EXCEPTIONS
Notwithstanding any other provisions hereof, the Agent shall not be
obliged to agree to any such amendment or waiver if the same would:
36.3.1 amend or waive this Clause 36 (Amendments), Clause 22 (Costs
and Expenses) or Clause 29 (The Agent, the Arrangers and the
Banks); or
36.3.2 otherwise amend or waive any of the Agent's rights hereunder
or subject the Agent or the Arrangers to any additional
obligations hereunder.
36.4 AMENDMENTS REQUIRING THE CONSENT OF THE STEERING COMMITTEE GROUP
An amendment or waiver to Clause 9.5 (Mandatory Prepayment from Capital
Event Proceeds) or the definitions of "Capital Event Proceeds" or
"Required Percentage" may be made by the Agent acting upon the
instructions of the Steering Committee Group.
37. ACCESSION OF GUARANTORS
103
105
37.1 REQUEST FOR GUARANTOR
The Borrower may request that any member of the Parent Covenant Group
become a Guarantor by delivering to the Agent a Guarantor Accession
Memorandum duly executed by the Borrower and such member of the Parent
Covenant Group, together with the documents and other evidence listed in
Schedule 11 (Additional Conditions Precedent) in relation to such
member.
37.2 GUARANTOR CONDITIONS PRECEDENT
A company, in respect of which the Borrower has delivered a Guarantor
Accession Memorandum to the Agent, shall become a Guarantor and assume
all the rights, benefits and obligations of a Guarantor as if it has
been an original party hereto as a Guarantor on the date on which the
Agent notifies the Borrower that it has received, in form and substance
satisfactory to it, all the documents and other evidence listed in
Schedule 11 (Additional Conditions Precedent).
38. GOVERNING LAW
This Agreement is governed by English law.
39. JURISDICTION
39.1 ENGLISH COURTS
The courts of England have exclusive jurisdiction to settle any dispute
(a "DISPUTE") arising out of or in connection with this Agreement
(including a dispute regarding the existence, validity or termination of
this Agreement or the consequences of its nullity).
39.2 CONVENIENT FORUM
The parties agree that the courts of England are the most appropriate
and convenient courts to settle Disputes between them and, accordingly,
that they will not argue to the contrary.
39.3 NON-EXCLUSIVE JURISDICTION
This Clause 39 (Jurisdiction) is for the benefit of the Finance Parties
only. As a result and notwithstanding Clause 39.1 (English Courts), it
does not prevent any Finance Party from taking proceedings relating to a
Dispute ("PROCEEDINGS") in any other courts with jurisdiction. To the
extent allowed by law, the Finance Parties may take concurrent
Proceedings in any number of jurisdictions.
39.4 SERVICE OF PROCESS
Each Guarantor (other than the Intermediate Parent), agrees that the
documents which start any Proceedings and any other documents required
to be served in relation to those Proceedings may be served on it by
service of such documents on NTL Group Limited at XXX Xxxxx, Xxxxxxx
Xxxx Xxxxxxxx Xxxx, Xxxx, Xxxxxxxxx XX00 0XX (marked for the attention
of Xxxxxx Xxxxxxxxx) or, if different, its registered office.
If any Guarantor ceases to have a place of business in Great Britain or,
as the case may be, the appointment of the person mentioned in this
Clause 39.4 ceases to be effective, such person shall immediately
appoint another person in England to accept service of process on its
behalf in England. If any Guarantor fails to do so (and such failure
continues for a period of not less than fourteen days), the Agent shall
be entitled to
104
106
appoint such a person by notice to such person. Nothing contained
herein shall restrict the right to serve process in any other manner
allowed by law. This Clause 39.4 applies to Proceedings in England and
to Proceedings elsewhere.
40. INTERCREDITOR AGREEMENT
Each Obligor acknowledges that the Banks have entered into the
Intercreditor Agreement (including, without limitation, Clause 2.1
(Waiver of Drawdown Conditions) thereof and that they have been
provided with a copy thereof. Each Obligor acknowledges that (x)
neither it nor any other member of the Group nor any other person shall
be deemed to be a third party beneficiary of the Intercreditor
Agreement or have any right to enforce or cause the enforcement of any
right, remedy or obligation of any party to the Intercreditor Agreement
and (y) the terms of the Intercreditor Agreement can be amended,
modified, waived or terminated without their consent. The Agent shall
notify the Borrower of any such amendment, modification, waiver or
termination promptly after its occurrence.
105
107
SCHEDULE 1
THE BANKS
BANK COMMITMENT
L
The Chase Manhattan Bank 650,000,000
Xxxxxx Xxxxxxx Senior Funding, Inc. 0
650,000,000
Xxxxxx Xxxxxxx Xxxx Xxxxxx Bank Limited --------------
L1,300,000,000
==============
1
108
SCHEDULE 2
FORM OF TRANSFER CERTIFICATE
To: Chase Manhattan International Limited
TRANSFER CERTIFICATE
relating to the agreement (as from time to time amended, varied, novated or
supplemented, the "CREDIT AGREEMENT") dated 30 May 2000 whereby a L1,300,000,000
multiple draw loan facility was made available to NTL Communications Limited by
a group of banks on whose behalf Chase Manhattan International Limited acted as
agent in connection therewith.
1. Terms defined in the Credit Agreement shall, subject to any contrary
indication, have the same meanings herein. The terms Bank, Transferee
and Portion Transferred are defined in the schedule hereto.
2. The Bank (i) confirms that the details in the schedule hereto under the
heading "BANK'S PARTICIPATION IN THE FACILITY" and ["ADVANCES"]
accurately summarises its participation in the Credit Agreement and the
Interest Period or Term of any existing Advances and (ii) requests the
Transferee to accept and procure the transfer by novation to the
Transferee of the Portion Transferred (specified in the schedule hereto)
of its Commitment and/or its participation in such Advance(s) by
counter-signing and delivering this Transfer Certificate to the Agent at
its address for the service of notices specified in the Credit
Agreement.
3. The Transferee hereby requests the Agent to accept this Transfer
Certificate as being delivered to the Agent pursuant to and for the
purposes of Clause 30.5 (Transfers by Banks) of the Credit Agreement so
as to take effect in accordance with the terms thereof on the Transfer
Date or on such later date as may be determined in accordance with the
terms thereof.
4. The Transferee confirms that it has received a copy of the Credit
Agreement together with such other information as it has required in
connection with this transaction and that it has not relied and will not
hereafter rely on the Bank to check or enquire on its behalf into the
legality, validity, effectiveness, adequacy, accuracy or completeness of
any such information and further agrees that it has not relied and will
not rely on the Bank to assess or keep under review on its behalf the
financial condition, creditworthiness, condition, affairs, status or
nature of the NTL Holding Group or the Obligors.
5. The Transferee hereby undertakes with the Bank and each of the other
parties to the Credit Agreement that it will perform in accordance with
their terms all those obligations which by the terms of the Finance
Documents will be assumed by it after delivery of this Transfer
Certificate to the Agent and satisfaction of the conditions (if any)
subject to which this Transfer Certificate is expressed to take effect.
6. The Bank makes no representation or warranty and assumes no
responsibility with respect to the legality, validity, effectiveness,
adequacy or enforceability of the Finance Documents or any document
relating thereto and assumes no responsibility for the financial
condition of the Obligors or for the performance and observance by the
1
109
Obligors of any of its obligations under the Finance Documents or any
document relating thereto and any and all such conditions and
warranties, whether express or implied by law or otherwise, are hereby
excluded.
7. The Bank hereby gives notice that nothing herein or in the Finance
Documents (or any document relating thereto) shall oblige the Bank to
(a) accept a re-transfer from the Transferee of the whole or any part of
its rights, benefits and/or obligations under the Finance Documents
transferred pursuant hereto or (b) support any losses directly or
indirectly sustained or incurred by the Transferee for any reason
whatsoever including the non-performance by an Obligor or any other
party to the Finance Documents (or any document relating thereto) of its
obligations under any such document. The Transferee hereby acknowledges
the absence of any such obligation as is referred to in (a) or (b)
above.
8. This Transfer Certificate and the rights, benefits and obligations of
the parties hereunder shall be governed by and construed in accordance
with English law.
THE SCHEDULE
9. Bank:
10. Transferee:
11. Transfer Date:
12. Bank's Participation in the Facility: Portion Transferred
Bank's Commitment
13. Advance(s): [Term and Repayment Date] Portion Transferred
Amount of Bank's Participation
[Transferor Bank] [Transferor Bank]
14. Portion Transferred of the Take Down
Fee payable in respect of Future
Advances
By: By:
Date: Date:
2
110
ADMINISTRATIVE DETAILS OF TRANSFEREE
Address:
Contact Name:
Account for Payments:
Telex:
Fax:
Telephone:
NOTE: EACH TRANSFEREE SHOULD, AT THE SAME TIME AS EXECUTING THIS TRANSFER
CERTIFICATE, EXECUTE AN ACCESSION MEMORANDUM IN RELATION TO THE SECURITY TRUST
AGREEMENT AND THE INTERCREDITOR AGREEMENT.
3
111
SCHEDULE 3
CONDITIONS PRECEDENT
(A) CORPORATE DOCUMENTS
1. In relation to each Obligor:
(a) a copy, certified as at the date of this Agreement a true and
up-to-date copy by an Authorised Signatory of such Obligor, of
the constitutional documents of such Obligor;
(b) a copy, certified as at the date of this Agreement a true and
up-to-date copy by an Authorised Signatory of such Obligor, of
a board resolution of such Obligor approving the execution,
delivery and performance of the Finance Documents to which
such Obligor is party and the terms and conditions thereof and
authorising a named person or persons to sign such Finance
Documents and any documents to be delivered by such Obligor
pursuant thereto; and
(c) a certificate of an Authorised Signatory of such Obligor
setting out the names and signatures of the persons authorised
to sign, on behalf of such Original Obligor, the Finance
Documents to which such Obligor is party and any documents to
be delivered by such Obligor pursuant thereto.
2. In relation to the Borrower a certificate of an Authorised Signatory of
the Borrower confirming that utilisation of the full amount of the
Facility would not breach any restriction of its borrowing powers.
3. The Group Structure Chart referred to in paragraph (a) of the
definition of that term.
(B) ACCOUNTS AND REPORTS
1. The Business Plan.
2. Copies of the Original Financial Statements, referred to in paragraphs
(a) to (c) of the definition of that term, certified true copies by an
Authorised Signatory of the Borrower (in the case of its financial
statements).
(C) ACQUISITION AND RELATED MATTERS
1. A copy, certified by an Authorised Signatory of the Borrower as true,
complete and up-to-date, of the Transaction Agreement.
2. A certificate from an Authorised Signatory of the Borrower confirming
that all the conditions precedent to the completion of the Acquisition
in accordance with the Transaction Agreement have been satisfied or
waived as permitted thereby save insofar as such conditions precedent
relate to or are dependent upon the utilisation of the Senior Bank
Credit Agreement.
3. A copy, certified as being a true and complete copy by an Authorised
Signatory of
1
112
the Borrower of the resolutions of the shareholders of the Target
passed at the Court Meetings.
4. A copy, certified as being a true and complete copy by an Authorised
Signatory of Borrower, of the resolutions of the shareholders of the
Target passed at the EGM.
5. A certified copy of the order of the Court sanctioning the Scheme under
Section 425, as registered with the Registrar of Companies.
6. Certified copies of executed stock transfer forms evidencing that NTL
Holdings will upon registration of the transfers effected by such stock
transfer forms, hold 100 per cent. of the issued share capital of CWC
Holdings.
7. Certificate of an Authorised Signatory of the Borrower confirming that
all necessary consents, licenses, authorisations and approvals in
relation to the Acquisition and the Finance Documents have been
obtained together with copy letters from the ITC, Oftel and the DTI and
any consents or other approvals required under the terms of any
License.
8. A letter from the Borrower's insurance broker addressed to the Agent
confirming the adequacy of the UK Group's insurance cover.
(D) SECURITY DOCUMENTS AND RELATED DOCUMENTATION
1. The Pledge Agreement, the Intercompany Loan Assignment Agreement and
the Share Charge, duly executed and delivered by the relevant Obligor.
2. A share certificate and executed blank stock transfer form in respect
of 100% of the issued share capital of Intermediate Parent, as charged
in favour of the Security Trustee pursuant to the Pledge Agreement.
3. A share certificate and executed blank stock transfer form in respect
of 65% of the issued share capital of the Borrower, as charged in
favour of the Security Trustee pursuant to the Share Charge.
4. The Parent Subordination Agreement duly executed by the Parent.
5. The Intermediate Subordination Agreement duly executed by the
Intermediate Parent.
6. The Security Trust Agreement duly executed and delivered by the parties
thereto.
7. UCC-1 financing statements in respect of the Security executed by the
Parent and the Intermediate Parent.
(E) LEGAL OPINIONS
Legal opinion from the following:
(a) White & Case LLP, London, the Agent's English counsel; and
(b) Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP, the Parent's United
States counsel,
in each case in substantially the form distributed to the Banks prior
to the signing of this Agreement.
2
113
(F) MISCELLANEOUS
1. The fees letters referred to in Clause 21.4 (Agency and Other Fees).
2. Evidence that NTL Group Limited has agreed to act as the agent of the
Parent and Intermediate Parent for the service of process in England in
respect of:
(a) this Agreement (for the Parent and the Intermediate Parent);
(b) the Subordination Agreement (for the Parent and the
Intermediate Parent); and
(c) the Assignment Agreement (for the Parent and the Intermediate
Parent).
3. Evidence confirming that, in addition to the amounts specified in the
balance sheet in the management accounts for the Group for the period
ended 30 April 2000, an amount of L2,800,000,000 (or its equivalent)
has been invested in the common stock or convertible preferred stock of
NTL Holdings by France Telecom S.A.
4. Evidence that no less than:
(a) L215,798,000 was available for use by the UK Group as at 25
May, 2000; and
(b) L591,166,950 was available for use by the Original Borrower
(as defined in the Senior Bank Credit Agreement) as at 25 May,
2000
Such evidence comprising of certificates from an Authorised Signatory
of the Borrower or, as the case may be, the Original Borrower (as
defined in the Senior Bank Credit Agreement).
5. Evidence that the Senior Bank Credit Agreement is in place and all
conditions precedent thereunder (save for those that are conditional on
the effectiveness of this Agreement) have been satisfied or waived in
accordance with their terms.
6. The Intercreditor Agreement, duly executed by the parties thereto.
3
114
SCHEDULE 4
NOTICE OF DRAWDOWN
From: [Borrower]
To: Chase Manhattan International Limited
Dated:
Dear Sirs,
1. We refer to the agreement (the "CREDIT AGREEMENT") dated 30 May 2000
and made between, among others, NTL Communications Limited as the
Borrower, Chase Manhattan PLC and Xxxxxx Xxxxxxx Xxxx Xxxxxx Bank
Limited as arrangers and joint bank managers, Chase Manhattan
International Limited as agent and the financial institutions named
therein as Banks. Terms defined in the Credit Agreement shall have the
same meaning in this notice.
2. This notice is irrevocable.
3. We hereby give you notice that, pursuant to the Credit Agreement and on
[date of proposed Advance], we wish to borrow an Advance of L[ ] upon
the terms and subject to the conditions contained therein.
4. We would like this Advance to have an Interest Period of [ ] months'
duration.
5. We confirm that, at the date hereof, [the Repeated Representations are
true in all material respects and no Event of Default [or Potential
Event of Default] is continuing].
6. This Advance will be used for the purpose set forth in Clause 2.2
(Purpose) of the Credit Agreement.
7. The proceeds of this drawdown should be credited to [insert account
details].
Yours faithfully
Authorised Signatory
for and on behalf of
[Insert name of Borrower]
1
115
SCHEDULE 5
EXISTING ENCUMBRANCES
The Encumbrances set forth in Schedule 5 to the Senior Bank Credit Agreement
as in effect on the Execution Date.
1
116
SCHEDULE 6
FORM OF COMPLIANCE CERTIFICATE
[TO BE UPDATED]
To: Chase Manhattan International Limited
Date:
Dear Sirs,
1. We refer to an agreement (the "CREDIT AGREEMENT") dated 30 May 2000 and
made between, among others, NTL Communications Limited as the Borrower,
Xxxxxx Xxxxxxx Xxxx Xxxxxx Bank Limited and Chase Manhattan Plc as
arrangers and joint bank managers, Chase Manhattan International
Limited as agent and the financial institutions defined therein as
Banks.
2. Terms defined in the Credit Agreement shall bear the same meaning
herein.
3. We confirm that:
(a) The ratio of the Senior UK Group Debt on [Quarter Date] to the
Annualised EBITDA of the UK Group for the period ended on
[Quarter Date] was [ ]:1.
(b) The ratio of the EBITDA of the UK Group for the Relevant
Period ended on [Quarter Date] to the Consolidated Finance
Charges of the [Covenant] Group for that Relevant Period was [
]:1.
(c) [The ratio of the Total Covenant Group Debt on [Quarter Date]
to the Annualised EBITDA of the UK Group for the Relevant
Period ended on [Quarter Date] was [ ]:1
The calculation of the above ratios are set out in the
Schedule to this Compliance Certificate.
4. We also confirm that the amount of Available Excess Cash Flow
as at [ ] was [ ].
Signed Director Director
of of
NTL Communications Limited NTL Communications Limited
for and on behalf of
[name of auditors of NTL Communications Limited]
1
117
SCHEDULE 7
MANDATORY COSTS
1. The Mandatory Cost Rate is an addition to the interest rate to
compensate Banks for the cost of compliance with (a) the requirements of
the Bank of England and/or the Financial Services Authority (or, in
either case, any other authority which replaces all or any of its
functions) or (b) the requirements of the European Central Bank.
2. On the first day of each Interest Period (or as soon as possible
thereafter) the Agent shall calculate, as a percentage rate, a rate (the
"ADDITIONAL COSTS RATE") for each Bank, in accordance with the formula
set out below. The Mandatory Cost Rate will be calculated by the Agent
as a weighted average of the Banks' additional costs rates rounded to
five decimal places (weighted in proportion to the percentage
participation of each Bank in the relevant Advance) and will be
expressed as a percentage rate per annum.
3. The additional costs rate for any Bank lending from a Facility Office in
a Participating Member State will be notified by that Bank to the Agent
as the cost of complying with the minimum reserve requirements of the
European Central Bank.
4. The additional cost rate for any Bank lending from a Facility Office in
the United Kingdom will be calculated by the Agent as follows:
AB + C (B-D) + E x 0.01
----------------------- per cent. per annum.
100 - (A+C)
Where:
A is the percentage of Eligible Liabilities (assuming these to
be in excess of any stated minimum) which that Bank is from
time to time required to maintain as an interest free cash
ratio deposit with the Bank of England to comply with cash
ratio requirements.
B is the percentage rate of interest (excluding the Margin and
the Mandatory Cost Rate) payable for the relevant Interest
Period of the Loan.
C is the percentage (if any) of Eligible Liabilities which that
Bank is required from time to time to maintain as interest
bearing Special Deposits with the Bank of England.
D is the percentage rate per annum payable by the Bank of
England to the Agent on interest bearing Special Deposits.
E is the rate of charge payable by that Bank to the Financial
Services Authority pursuant to the Fees Regulations (but, for
this purpose, ignoring any minimum fee required pursuant to
the Fees Regulations) and expressed in pounds per L1,000,000
of the Fee Base of that Bank.
1
118
5. For the purposes of this Schedule:
(a) "ELIGIBLE LIABILITIES" and "SPECIAL DEPOSITS" have the
meanings given to them from time to time under or pursuant to
the Bank of England Act 1998 or (as may be appropriate) by the
Bank of England;
(b) "FEES REGULATIONS" means the Banking Supervision (Fees)
Regulations 1999 or such other law or regulation as may be in
force from time to time in respect of the payment of fees for
banking supervision; and
(c) "FEE BASE" has the meaning given to it, and will be calculated
in accordance with, the Fees Regulations.
6. In application of the above formula, A, B, C and D will be included in
the formula as percentages (i.e. 5 per cent. will be included in the
formula as 5 and not as 0.05). A negative result obtained by
subtracting D from B shall be taken as zero.
7. Each Bank shall supply any information required by the Agent for the
purpose of calculating its additional costs rate. In particular, but
without limitation, each Bank shall supply the following information in
writing on or prior to the date on which it becomes a Bank:
(a) its jurisdiction of incorporation and the jurisdiction of its
Facility Office; and
(b) such other information that the Agent may reasonably require
for such purpose.
Each Bank shall promptly notify the Agent in writing of any change to
the information provided by it pursuant to this paragraph.
8. The percentages or rates of charge of each Bank for the purpose of A, C
and E above shall be determined by the Agent based upon the information
supplied to it pursuant to paragraph 7 above and on the assumption that
unless a Bank notifies the Agent to the contrary, each Bank's
obligations in relation to cash ratio deposits, Special Deposits and the
Fee Regulations are the same as those of a typical bank from its
jurisdiction of incorporation with a Facility Office in the same
jurisdiction as its Facility Office.
The Agent shall have no liability to any person if such determination
results in an additional costs rate which over or under compensates any
Bank and shall be entitled to assume that the information provided by
any Bank pursuant to paragraphs 3 and 7 above is true and correct in all
respects.
9. The Agent shall distribute the additional amounts received pursuant to
the Mandatory Cost Rate to the Banks on basis of the additional cost
rate incurred by each Bank, as calculated in accordance with the above
formula and based on the information provided by each Bank pursuant to
paragraphs 3 and 7 above.
10. Any determination by the Agent pursuant to this Schedule in relation to
a formula, the Mandatory Cost Rate, an additional costs rate or any
amount payable to a Bank shall, in the absence of manifest error, be
conclusive and binding on all of the parties hereto.
2
119
11. The Agent may from time to time, after consultation with the Parent (on
behalf of the Borrowers) and the Banks, determine and notify to all
parties any amendments or variations which are required to be made to
this Schedule in order to comply with any change in law, regulation or
any requirements from time to time imposed by the Bank of England, the
Financial Services Authority or the European Central Bank (or, in either
case, any other authority which replaces all or any of its functions)
and any such determination shall, in the absence of manifest error, be
conclusive and binding on all the parties hereto.
3
120
SCHEDULE 8
FORM OF NON-BANK CERTIFICATE
Reference is hereby made to the Credit Agreement, dated as of
[_________________], 2000, among NTL COMMUNICATIONS LIMITED and various Finance
Parties from time to time party thereto (as amended, modified or supplemented
from time to time, the "Agreement"). Pursuant to the provisions of Clause 10.4
of the Agreement, the undersigned hereby certifies that it is not a "bank" as
such term is used in Section 881(c)(3)(A) of the Internal Revenue Code of 1986,
as amended.
[NAME OF BANK]
By_____________________________
Title:
Date: ____________________
1
121
SCHEDULE 9
FORM OF GUARANTOR ACCESSION MEMORANDUM
To: Chase Manhattan International Limited
From: [Subsidiary]
and
NTL Communications Corporation (the "PARENT")]
Dated:
Dear Sirs,
1. We refer to an agreement (the "CREDIT AGREEMENT") dated 30 May 2000 and
made between, among others, NTL Communications Corporation, NTL (UK)
Group, Inc., Xxxxxx Xxxxxxx Xxxx Xxxxxx Bank Limited and Chase Manhattan
Plc, as arrangers and joint book managers, Chase Manhattan International
Limited as agent and the financial institutions defined therein as
Banks.
2. Terms defined in the Credit Agreement shall bear the same meaning
herein.
3. The Parent requests that [Subsidiary] become a Guarantor pursuant to
Clause 37 (Accession of Guarantors) of the Credit Agreement.
4. [Subsidiary] is a company duly organised under the laws of [name of
relevant jurisdiction].
5. [Subsidiary] confirms that it has received from the Parent a true and
up-to-date copy of the Credit Agreement and a list of the Borrowers as
at the date hereof.
6. [Subsidiary] undertakes, upon its becoming a Guarantor, to perform all
the obligations expressed to be undertaken under the Credit Agreement by
a Guarantor and agrees that it shall be bound by the Credit Agreement in
all respects as if it had been an original party thereto as a Guarantor.
7. The [Subsidiary]:
repeats the Repeated Representations; and
confirms that no Event of Default or Potential Event of Default is
continuing or would occur as a result of [Subsidiary] becoming a
Guarantor.
8. [Subsidiary's] administrative details are as follows:
Address:
Fax No.:
9. [PROCESS AGENT*
[Subsidiary] agrees that the documents which start any Proceedings and
any other
* This clause is required only if the Guarantor is not incorporated in England
or Wales.
1
122
documents required to be served in relation to those Proceedings may be
served on it at [address of Subsidiary's place of business in England]
or at any address in Great Britain at which process may be served on it
in accordance with Part XXIII of the Companies Act 1985] / [on name of
process agent in England at address of process agent or, if different,
its registered office. If [Subsidiary] ceases to have a place of
business in Great Britain]/[ the appointment of the person mentioned
above ceases to be effective], [Subsidiary] shall immediately appoint
another person in England to accept service of process on its behalf in
England. If it fails to do so (and such failure continues for a period
of not less than fourteen days), the Agent shall be entitled to appoint
such a person by notice. Nothing contained herein shall restrict the
right to serve process in any other manner allowed by law. This applies
to Proceedings in England and to Proceedings elsewhere.]
10. This Memorandum shall be governed by English law.
11. This Memorandum is executed and delivered as a deed by [Subsidiary].
[NAME OF SUBSIDIARY]
By:
Name:
Title:
NTL COMMUNICATIONS CORPORATION
By:
Name:
Title:
2
123
SCHEDULE 10
ADDITIONAL CONDITIONS PRECEDENT
1. A copy, certified as at the date of the Guarantor Accession Memorandum a
true and up-to-date copy by an Authorised Signatory of the proposed
Guarantor, of the constitutional documents of such proposed Guarantor.
2. A copy, certified as at the date of the Guarantor Accession Memorandum a
true and up-to-date copy by an Authorised Signatory of the proposed
Guarantor, of a board resolution of such proposed Guarantor approving
the execution and delivery of a Guarantor Accession Memorandum, the
accession of such proposed Guarantor to this Agreement and the
performance of its obligations under the Finance Documents and
authorising a named person or persons to sign such Guarantor Accession
Memorandum, any other Finance Document and any other documents to be
delivered by such proposed Guarantor pursuant thereto.
3. A certificate of an Authorised Signatory of the proposed Guarantor
setting out the names and signatures of the person or persons authorised
to sign, on behalf of such proposed Guarantor, the Guarantor Accession
Memorandum, any other Finance Documents and any other documents to be
delivered by such proposed Guarantor pursuant thereto.
4. An opinion of counsel to the proposed Guarantor in form and substance
reasonably satisfactory to the Agent.
5. A certificate executed by an Authorised Signatory of such Guarantor and
the Parent certifying that (i) such Guarantor is a newly formed
corporation organised under the laws of the United States (or any state
therein), (ii) such Guarantor has no liabilities other than pursuant to
the Finance Documents or intercompany loans incurred from its direct
parent company which are subject to a Subordination Agreement, (iii)
such Guarantor has no assets other than intercompany loans made to its
direct subsidiary which are subject to a Subordination Agreement and
the capital stock of its direct subsidiary all of which are subject to
a first priority lien pursuant to the Security Documents (or in the
case such Guarantor is the direct parent of the Borrower, 65% of such
capital stock) and (iv) 100% of the capital stock of such Guarantor is
subject to a first priority lien pursuant to the Security Documents.
6. A deed of accession to the Security Trust Agreement executed by the
proposed Guarantor, substantially in the form set out in Schedule 1
(Form of Obligor Deed of Accession) to the Security Trust Agreement.
1
124
Page
SIGNATURES
THE PARENT
NTL COMMUNICATIONS CORP.
By: /s/ Xxxxxxx Xxxxxxx
Address: 000 Xxxx 00xx Xxxxxx
00xx Xxxxx
Xxx Xxxx
XX 00000
XXX
Fax: 000 000 000 0000
Attention: Xxxxxxx Xxxxxxx/Xxxxxx Xxxxxxx-Xxxxx
THE BORROWER
NTL COMMUNICATIONS LIMITED
By: /s/ X. Xxx
Address: NTL House
Xxxxxxx Xxxx Xxxxxxxx Xxxx
Xxxx
Xxxxxxxxx
XX00 0XX
Fax: 00000 000000
Attention: Xxxxx Xxxxxxx
With a copy to: 000 Xxxx 00xx Xxxxxx
00xx Xxxxx
Xxx Xxxx
XX 00000
XXX
Fax: 000 000 000 0000
Attention: Xxxxxxx Xxxxxxx/Xxxxxx Xxxxxxx-Xxxxx
THE INTERMEDIATE PARENT
NTL (UK) GROUP, INC.
By: /s/ X. Xxx
Address: NTL House
Xxxxxxx Xxxx Business Park
Hook
(i)
125
Page
Xxxxxxxxx
XX00 0XX
Fax: 00000 000000
Attention: Xxxxx Xxxxxxx
With a copy to: 000 Xxxx 00xx Xxxxxx
00xx Xxxxx
Xxx Xxxx
XX 00000
XXX
Fax: 000 000 000 0000
Attention: Xxxxxxx Xxxxxxx/Xxxxxx Xxxxxxx-Xxxxx
THE ARRANGERS
CHASE MANHATTAN PLC
By: /s/ Xxx X. Xxxxx
Address: 000 Xxxxxx Xxxx
Xxxxxx XX0X 0XX
XXXXXX XXXXXXX XXXX XXXXXX BANK LIMITED
By: /s/ Mathias Blumschein
Address: 0000 Xxxxxxxx
Xxx Xxxx0.
XX 00000
XXX
THE AGENT
CHASE MANHATTAN INTERNATIONAL LIMITED
By: /s/ Xxx X. Xxxxx
Address: Xxxxxxx Xxxxx
0 Xxxxxx Xxxxx Xxxxxx
Xxxxxx X0 0XX
Fax: x00(0) 000 000 0000
Attention: Xxxxx Xxxxx
Loans Agency Department
(ii)
126
Page
THE SECURITY TRUSTEE
CHASE MANHATTAN INTERNATIONAL LIMITED
By: /s/ Xxx X. Xxxxx
Address: Xxxxxxx Xxxxx
0 Xxxxxx Xxxxx Xxxxxx
Xxxxxx X0 0XX
Fax: x00(0) 000 000 0000
Attention: Xxxxx Xxxxx
Loans Agency Department
THE BANKS
THE CHASE MANHATTAN BANK
By: /s/ Xxx X. Xxxxx
XXXXXX XXXXXXX XXXX XXXXXX BANK LIMITED
By: /s/ Mathias Blumschein
XXXXXX XXXXXXX SENIOR FUNDING, INC.
By:
(iii)
