EXHIBIT 4(oo)
Mallesons Xxxxxxx Xxxxxx
Shareholder Term Loan Facility Agreement
Dated 12 January 2001
Reach Finance Limited ("Borrower")
Reach Ltd. ("REACH")
Reach Networks Hong Kong Limited
Reach Networks Australia Pty Limited
Reach Global Networks Limited
Reach Global Services Limited
Reach International Holdings Limited
Reach Global Holdings Limited
Reach Networks KK ("Initial Guarantors")
Telstra Corporation Limited ("Telstra")
PCCW Limited ("PCCW")
Mallesons Xxxxxxx Xxxxxx
Level 28
Rialto
000 Xxxxxxx Xxxxxx
Xxxxxxxxx Xxx 0000
Xxxxxxxxx
T x00 0 0000 0000
F x00 0 0000 0000
DX 101 Melbourne
xxx.xxxxxxxxx.xxx
AJMG:NPC
Shareholder Term Loan Facility Agreement
Contents
1 The Facilities 4
2 Using the Facilities 4
3 Interest 4
4 Repaying and prepaying 6
5 Payments 8
6 [intentionally left blank] 9
7 [intentionally left blank] 9
8 Withholding tax 9
9 Increased costs 11
10 Illegality 12
11 Representations and warranties 13
12 Undertakings 14
13 Default 16
14 Costs and indemnities 17
15 Interest on overdue amounts 21
16 Guarantee and indemnity 21
17 [intentionally left blank] 26
18 [intentionally left blank] 26
19 [intentionally left blank] 26
20 [intentionally left blank] 26
21 [intentionally left blank] 26
i
22 [intentionally left blank] 26
23 [intentionally left blank] 26
24 [intentionally left blank] 26
25 [intentionally left blank] 26
26 [intentionally left blank] 26
27 Relationships between parties 27
28 Dealing with interests 27
29 Notices 28
30 General
31 Interpretation 34
Schedule 1 - New Guarantor documentation (clause 16.12) 48
Schedule 2 - [intentionally left blank] 50
Schedule 3 - [intentionally left blank] 51
Schedule 4 - Payment details (clause 5.4) 52
Schedule 5 - Form of New Guarantor Deed Poll (clause 16.12) 53
Schedule 6 - [intentionally left blank] 55
Schedule 7 - [intentionally left blank] 56
Schedule 8 - [intentionally left blank] 57
Schedule 9 - [intentionally left blank] 58
Schedule 10 - [intentionally left blank] 59
ii
Shareholder Term Loan Facility Agreement
Details
Interpretation - Definitions are at the end of this agreement before the
schedules.
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Parties The Borrower, REACH, Initial Guarantors, Telstra and
PCCW, each as described below.
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Borrower Name Reach Finance Limited (formerly
known as Capital Next Limited)
Incorporated in Hong Kong
Address 20th Xxxxx
Xxxxxxx Xxxxx
0 Xxxxxxxxxx Xxxx
Xxxxxxx
Xxxx Xxxx
Fax (1) x000 0000 0000
(2) x000 0000 0000
Telephone x000 0000 0000
Attention (1) Finance Director
(2) General Counsel
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REACH Name Reach Ltd. (formerly known as Joint
Venture (Bermuda) No 1 Limited)
Incorporated in Xxxxxxx
Xxxxxxx Xxxxxxxxx Xxxxx
0 Xxxxxx Xxxxxx
PO Box HM666
Xxxxxxxx XX CX
Bermuda
Fax (1) x0 000 000 0000
(2) x000 0000 0000
Telephone x0 000 000 0000
Attention (1) Company Secretary
(2) General Counsel
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Initial Guarantors REACH
Reach Networks Hong Kong Limited
Reach Networks Australia Pty
Limited
Reach Global Networks Limited
Reach Global Services Limited
1
Reach International Holdings
Limited
Reach Global Holdings Limited
Reach Networks KK
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Financiers See end of these Details
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Obligor The Borrower, each Guarantor and each Chargor.
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Facilities The Telstra Facility and the PCCW Facility.
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Telstra Facility Description A term loan facility provided by
Telstra.
Telstra Facility US$600,000,000 on the Effective Date
Limit (as reduced by the amount of any
repayment or prepayment under clause
4 ("Repaying and prepaying")).
Maturity date The Final Maturity Date.
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PCCW Facility Description A term loan facility provided by
PCCW.
PCCW Facility Limit US$600,000,000 on the Effective Date
(as reduced by the amount of any
repayment or prepayment under clause
4 ("Repaying and prepaying")).
Maturity date The Final Maturity Date.
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Repayment / Final Drawings are repayable on 31 December 2010 (the Final
Maturity Date Maturity Date).
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Interest Rate LIBOR plus Margin.
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Interest Periods 1, 2 or 3 months or another period as agreed by the
Financiers.
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Margin 2.5 per cent. per annum or such increased percentage
as provided in clause 3.7 ("Increased Margin").
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Transaction o this agreement (as amended and restated)
Documents
o the CPP Agreement
o the Working Capital Facility Agreement
o the Security Documents
o any New Guarantor Deed Poll or other guarantee
entered into under clause 16.12 ("Becoming a New
Guarantor")
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Reference Banks JPMorgan Xxxxx Xxxx
0
Xxxxxxxx Xxxx XXX
Xxxxxxxx, N.A. Hong Kong Branch
UFJ Bank Limited, Hong Kong Branch
The Hongkong and Shanghai Banking Corporation Limited
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Process Agent's Simmlaw Services Limited
address (clause Xxxxxxx & Xxxxxxx
30.24) City Point
One Xxxxxxxxx Xxxxxx
Xxxxxx XX0X 0XX
XXXXXXX
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Governing law English law
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Date of agreement 12 January 2001
---------------------- ---------------------------------------------------------
Financiers
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Telstra Name Telstra Corporation Limited
Address Xxxxx 00
000 Xxxxxxxxxx Xxxxxx
Xxxxxxxxx XXX 0000
Xxxxxxxxx
Fax x00 0 0000 0000
Telephone x00 0 0000 0000
Attention Company Secretary
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PCCW Name PCCW Limited
Address 00xx Xxxxx
XXXX Xxxxx
XxxXxx Xxxxx
000 Xxxx'x Xxxx
Xxxxxx Xxx
Xxxx Xxxx
Fax x000 0000 0000
Telephone x000 0000 0000
Attention Company Secretary
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3
Shareholder Term Loan Facility Agreement
General Terms
Interpretation - Definitions are at the end of this agreement before the
schedules.
The Facility
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1 The Facilities
1.1 Outstanding Facilities
Each Financier has acquired half of the total debt under this
agreement. The first Interest Period after the Effective Date starts
on the Effective Date and is of one month.
1.2 Maximum accommodation
The maximum total amount of financial accommodation available to the
Borrower under a Facility is an amount equal to the Facility Limit for
that Facility.
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2 Using the Facilities
As at the Effective Date, the Borrower has fully used each Facility
and the original terms for drawing down have been deleted accordingly.
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3 Interest
3.1 Interest charges
The Borrower agrees to pay interest on each Drawing for each of its
Interest Periods at the applicable Interest Rate (or, where
applicable, the rate of interest determined under clause 3.5
("Substitution period and Interest Rate") or 3.6 ("Alternative
rate")). Interest:
(a) accrues daily from (and including) the first day of an
Interest Period to (but excluding) the last day of the
Interest Period; and
(b) is payable on each Interest Payment Date; and
(c) is calculated on actual days elapsed and a year of 360
days.
3.2 Notification of Interest Period
Each Interest Period is (subject to clause 3.3 ("When Interest
Periods begin and end")) a period notified by the Borrower to the
Financiers by 11.00am on the fourth Business Day before the last day
of the current Interest Period. However, in each case, the specified
period must be one that is set out in the Details. If the Borrower
does not give correct notice, the subsequent Interest
4
Period is the same length as the Interest Period which immediately
precedes it (or it is the period until the Final Maturity Date, if
that is shorter than the preceding Interest Period) unless it is a
period of more than 3 months, then such subsequent Interest Period
shall be 3 months.
The Borrower may, in its notification relating to an Interest Period
mentioned in the above paragraph, elect that the Drawing to which
that Interest Period relates shall at the beginning of that Interest
Period be split into 2 amounts provided that each amount shall be
specified in that notification but shall be of a minimum amount of
US$10,000,000. Each amount shall be deemed to be a separate Drawing.
However, an Interest Period which would otherwise end after the Final
Maturity Date ends on the Final Maturity Date.
3.3 When Interest Periods begin and end
Each Interest Period begins on the day when the preceding Interest
Period for the Drawing ends. An Interest Period which would otherwise
end on a day which is not a Business Day ends on the next Business
Day (unless that day falls in the following month, in which case the
Interest Period ends on the previous Business Day).
3.4 Market disruption
If, in relation to any Drawing:
(a) LIBOR for an Interest Period is to be determined by
reference to Reference Banks and at or about the time at
which the rate is to be set for the relevant Interest
Period, none or only one of the Reference Banks supplies a
rate for the purpose of determining LIBOR for that Interest
Period; or
(b) before close of business in London on the date on which
LIBOR is to be set for an Interest Period the Financiers
agree that the cost to each of them of obtaining matching
deposit in the London interbank market would be in excess
of LIBOR for that Interest Period, then:
(i) the Financier must promptly notify the Borrower
of that event; and
(ii) clause 3.5 ("Substitution period and Interest
Rate") applies to the Drawing.
3.5 Substitution period and Interest Rate
If clause 3.4 ("Market disruption") applies:
(a) the duration of the relevant Interest Period for the
Drawing is one month (subject to clause 3.3 ("When Interest
Periods begin and end")); and
(b) the rate of interest on each Drawing for the Interest
Period is (subject to any agreement reached under clause
3.6 ("Alternative rate")) is the rate per annum which is
the sum of:
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(i) the Margin; and
(ii) [intentionally left blank]
(iii) the rate per annum notified to the Borrower by
the Financiers as soon as reasonably practicable
and in any event before the last day of that
Interest Period to be the rate which expresses as
a percentage rate per annum the cost to the
Financiers of funding, from whatever sources they
may reasonably select, that Drawing during that
Interest Period.
3.6 Alternative rate
If clause 3.4 ("Market disruption") occurs in relation to a Drawing
and the Borrower so requires, the Financiers and the Borrower must
enter into negotiations (for a period of not more than 30 days) with
a view to agreeing a substitute basis for determining the rates of
interest from time to time applicable to Drawings. Any substitute
basis that is agreed only takes effect and binds the parties if
approved by each Financier.
3.7 Increased Margin
With effect from and including 1 January 2008 and unless the amount
of the outstanding Drawings has been reduced to US$900,000,000 or
less, the Margin shall be increased to 3.5 per cent. per annum.
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4 Repaying and prepaying
4.1 Repayment of Drawings
The Borrower agrees to repay all Drawings on the Final Maturity Date.
4.2 Payments must be in Proportion
Subject to clause 4.9 ("Mandatory prepayment - CPP Agreement"), any
payment, repayment or prepayment under a Facility requires the
relevant Obligor to pay, repay or prepay an amount under the other
Facility so that the total payment is divided between the Financiers
into amounts that are equal to each Financier's Proportion of the
total amount to be paid, repaid or prepaid at the time immediately
before the payment is made.
The Financiers acknowledge that their Proportions may not be equal if
a Financier requires an Obligor to make payments under the CPP
Agreement in accordance with clause 4.9 ("Mandatory prepayment - CPP
Agreement").
4.3 Financiers to ensure payments in Proportion
Each Financier agrees that if it receives any amount in respect of a
Facility which is more than it would have received if the payment had
been made in the correct Proportion for each Financier in accordance
with clause 4.2, that Financier must immediately pay an amount to the
other Financier so that the other Financier receives the amount that
it should have received if the payment had been made in the correct
Proportion for each Financier.
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The Obligors agree that any amount paid to a Financier under this
clause 4.3:
(a) increases the Amount Owing for the Financier that makes the
payment; and
(b) decreases the Amount Owing for the Financier that receives
the payment,
by the amount of the payment.
4.4 Prepayment of Drawings - no Break Costs
The Borrower may prepay all or part of a Drawing at any time without
premium or penalty and without the payment of Break Costs, as
follows:
(a) the prepayment amount must be at least US$2,000,000 and a
whole multiple of US$1,000,000; and
(b) the Borrower must notify the proposed prepayment to the
Financiers by 11.00am on the tenth day before the date of
the prepayment. Once given, a notice of prepayment is
irrevocable and the Borrower is obliged to prepay in
accordance with the notice; and
(c) the prepayment must be made on the last day of an Interest
Period for the Drawing.
Prepayments are to be applied to reduce the principal amount of the
Drawings.
4.5 Prepayment of Drawings - with Break Costs
The Borrower may prepay all or part of a Drawing at any time (but may
incur Break Costs - see clause 14.2 ("Indemnity")), as follows:
(a) the prepayment amount must be at least US$2,000,000 and a
whole multiple of US$1,000,000; and
(b) the Borrower must notify the proposed prepayment to the
Financiers by 11.00am on the tenth day before the date of
the prepayment. Once given, a notice of prepayment is
irrevocable and the Borrower is obliged to prepay in
accordance with the notice.
Prepayments are to be applied to reduce the principal amount of the
Drawings.
4.6 [intentionally left blank]
4.7 [intentionally left blank]
4.8 [intentionally left blank]
4.9 Mandatory Prepayment - CPP Agreement
If the CPP Agreement requires an Obligor to make a payment to either
of the Financiers under that agreement in repayment or prepayment of
the Drawings
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under a Facility, the relevant Obligor must make the payment required
in repayment or prepayment of the Drawings under the relevant
Facility. The Financiers agree that nothing in this agreement
prevents an Obligor from making a payment to either of the Financiers
that is not in accordance with each Financier's Proportion of the
Drawings if that payment is required under the CPP Agreement.
4.10 Prepayment and Facility Limit
The relevant Facility Limit is reduced by all amounts repaid or
prepaid. Amounts prepaid are not available for redrawing.
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5 Payments
5.1 Manner of payment
Despite any other provision of a Transaction Document, the Obligor
agrees to make payments (including by way of reimbursement) under
each Transaction Document:
(a) on the due date (or, if that is not a Business Day, on the
next Business Day unless that day falls in the following
month or after the Final Maturity Date, in which event, on
the previous Business Day); and
(b) not later than 11.00am in the place for receipt of payment;
and
(c) in US Dollars in immediately available funds; and
(d) in full without set-off or counterclaim, and without any
deduction in respect of Taxes unless (in the case of a
deduction in respect of Taxes) required by law and subject
to and in accordance with clause 8 ("Withholding tax"); and
(e) to each Financier by payment into the account nominated by
that Financier, or by payment that Financier otherwise
directs.
If a Financier directs the Obligor to pay a particular party or in a
particular manner, the Obligor is taken to have satisfied its
obligation to that Financier by paying in accordance with the
direction.
5.2 Currency of payment
The Obligor waives any right it has in any jurisdiction to pay an
amount other than in the currency in which it is due. However, if a
Financier receives an amount in a currency other than that in which it
is due:
(a) it may convert the amount received into the due currency
(even though it may be necessary to convert through a third
currency to do so) on the day and at the rates (including
spot rate, same day value rate or value tomorrow rate) as it
reasonably considers appropriate in accordance with its
customary business practices and may deduct:
(i) its usual levied Costs in connection with the
conversion; and
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(ii) other third party Costs it incurs in connection
with the conversion; and
(b) the Obligor satisfies its obligation to pay in the due
currency only to the extent of the amount of the due
currency obtained from the conversion after deducting the
Costs of the conversion.
5.3 Total Amount Owing
The Borrower agrees to pay the Total Amount Owing on the Final
Maturity Date under this agreement.
5.4 Payment details
The payment details for payments to each Financier are set out in
schedule 4 ("Payment details"), subject to any amendment to those
details by notice from a Financier to the other parties.
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6 [intentionally left blank]
7 [intentionally left blank]
8 Withholding tax
8.1 Payments by Obligor
If a law requires the Obligor to withhold or deduct an amount in
respect of Taxes from a payment under any Transaction Document such
that the Financier would not actually receive on the due date the full
amount provided for under the Transaction Document, then:
(a) the Obligor agrees to withhold or deduct the amount for the
Taxes (and any further withholding or deduction required by
law to be made in respect of any further payment due under
paragraph (c) below); and
(b) the Obligor agrees to pay an amount equal to the amount
withheld or deducted to the relevant authority in accordance
with applicable law and give the original receipts to the
relevant Financier; and
(c) if the amount deducted is in respect of Accountable Taxes,
the amount payable is increased so that, after making the
withholding or deduction and further withholding or
deductions applicable to additional amounts payable under
this clause, that Financier is entitled to receive and
retain (at the time the payment is due) the amount it would
have received if no deductions had been required.
8.2 Tax indemnity
The Borrower must (within three Business Days of demand) pay to any
Protected Party an amount equal to the loss, liability or cost which
that
9
Protected Party determines will be or has been (directly or
indirectly) suffered for or on account of Taxes by that Protected
Party. However:
(a) this clause 8.2 does not apply with respect to any Taxes
assessed on a Protected Party:
(i) under the law of the jurisdiction in which that
Protected Party is incorporated or, if different,
the jurisdiction (or jurisdictions) in which that
Protected Party is treated as resident for tax
purposes; or
(ii) under the law of the jurisdiction in which that
Protected Party's office through which it will
perform its obligations under this agreement is
located in respect of amounts received or
receivable in that jurisdiction,
if those Taxes are imposed on or calculated by reference to
the net income received or receivable (but not any sum
deemed to be received or receivable) by that Protected
Party; and
(b) a Protected Party making, or intending to make a claim under
this clause 8.2 must promptly notify the Borrower of the
event which will give, or has given rise to the claim; and
(c) a Protected Party must, on receiving a payment from the
Borrower under this clause 8.2, notify the other Financier.
8.3 Tax credit
This clause 8.3 applies if:
(a) the Obligor complies with clause 8.1(c) ("Payments by
Obligor"); or
(b) the Borrower complies with clause 8.2 ("Tax indemnity");
and, as a result, the Financier determines that it has obtained and
retained a tax credit, tax rebate or similar benefit for any tax
payable by it which is attributable to the increased amount paid to
the relevant Financier.
In that case, the Financier agrees to reimburse to the Obligor an
amount equal to the amount that the Financier determines to be the
proportion of the credit, rebate or benefit as will leave the
Financier (after the reimbursement) in no worse position than it would
have been in had no increase been required under clause 8.1(c) or 8.2.
8.4 Indirect Tax
All consideration expressed to be payable under a Transaction Document
by any Obligor to a Financier is exclusive of any Indirect Tax.
If any Indirect Tax is chargeable on any supply made by a Financier to
an Obligor in connection with a Transaction Document, that Obligor
must pay to the Financier (in addition to and at the same time as
paying the consideration, or if the Financier is required to pay that
Indirect tax earlier, upon
10
presentation of a tax invoice for that amount) an amount equal to the
amount of the Indirect Tax.
Where a Transaction Document requires an Obligor to reimburse a
Financier for any costs or expenses, that Obligor must also at the
same time pay and indemnify the Financier against all Indirect Tax
incurred by that Financier in connection with the costs or expenses
that the Financier reasonably determines that it is not entitled to
credit or repayment for the Indirect Tax.
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9 Increased costs
9.1 Compensation
The Borrower agrees to compensate a Financier within three Business
Days of demand if the Financier determines that:
(a) a Directive, or change in Directive, in either case applying
for the first time after the date of this agreement; or
(b) a change in a Directive's interpretation or administration
by an authority after the date of this agreement; or
(c) compliance by the Financier or any of its Related Entities
with any such Directive, changed Directive or changed
interpretation or administration
directly or indirectly:
(i) increases the cost of the Facility to the
Financier or any of its Related Entities which
cost is attributable to the Financier having
entered into or funded or performed its
obligations, or agreed to fund or perform its
obligations, under any Transaction Document; or
(ii) reduces any amount received or receivable by the
Financier or any of its Related Entities, or its
effective return, in connection with the Facility;
or
(iii) reduces the Financier's (or Related Entity's)
return on capital allocated to a Facility, or its
overall return on capital.
In this clause 9.1, a reference to a Directive does not include a
Directive imposing or changing the basis of a Tax on the overall net
income of the Financier or any of its Related Entities.
Compensation need not be in the form of a lump sum and may be demanded
as a series of payments.
The amount of compensation is the amount of (in the case of (i)) any
increase in cost or additional cost or (in the case of (ii) or (iii))
the reduction.
Any demand under this clause 9.1 is to be made by the Financier
affected.
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9.2 Substantiating costs
If a Financier makes a demand under clause 9.1 ("Compensation"), that
Financier agrees to give the Borrower reasonably detailed calculations
showing how the amount demanded has been ascertained. However, nothing
in this clause 9.2 obliges the Financier to provide details of its
business or tax affairs which it considers in good faith to be
confidential.
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10 Illegality
10.1 Financier's right to suspend or cancel
This clause 10 applies if a Financier determines that it has become or
will become illegal for the Financier to fund, provide, or continue to
fund or provide, financial accommodation under the Transaction
Documents or to otherwise perform any of its obligations under them.
In these circumstances, the Financier, by giving a notice to the
Borrower, may suspend or cancel some or all of that Financier's
obligations under the Transaction Documents as indicated in the
notice.
10.2 Extent and duration
The suspension or cancellation:
(a) must apply only to the extent necessary to avoid the
illegality; and
(b) in the case of suspension, may continue only for so long as
the illegality continues.
10.3 Notice requiring payment
The affected Financier, by giving a notice to the Borrower, may
require prepayment of all or any part of any affected Drawing and
interest accrued on that part as specified in the notice. The Borrower
agrees to pay the amount specified within 30 Business Days after
receiving the notice.
10.4 Financier to seek alternative funding method
If a notice is given under clause 10.3 ("Notice requiring payment"),
then the relevant Financier agrees to use reasonable endeavours for a
period of 30 days to make the relevant financial accommodation
available by some alternative means . However:
(a) this clause 10.4 does not in any way limit the obligations
of the Obligor under the Transaction Documents; and
(b) the Borrower indemnifies the Financier for all costs and
expenses reasonably incurred by it as a result of steps or
actions taken by it under this clause 10.4; and
(c) the Financier is not obliged to take any step or action
under this clause 10.4 if, in the reasonable opinion of the
Financier, to do so might be prejudicial to it.
12
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11 Representations and warranties
11.1 Representations and warranties
Each of REACH and the Borrower represents and warrants that:
(a) (incorporation and existence) each member of the REACH Group
has been incorporated in accordance with the laws of its
place of incorporation, is validly existing under those laws
and has power and authority to carry on its business as it
is now being conducted; and
(b) (power) each Obligor has power to enter into the Transaction
Documents to which it is a party and comply with its
obligations under them; and
(c) (no contravention or exceeding power) the Transaction
Documents and the transactions under them which involve an
Obligor do not contravene any Obligor's constituent
documents (if any) or contravene in a material respect any
law or obligation by which any Obligor is bound or to which
any Obligor's assets are subject which in any case would or
would be reasonably likely to have a Material Adverse
Effect, or cause a limitation on any Obligor's powers or the
powers of any Obligor's directors to be exceeded; and
(d) (authorisations) each Obligor has in full force and effect
the material authorisations necessary for it to enter into
the Transaction Documents to which it is a party, to comply
with its obligations and exercise its rights under them and
to allow them to be enforced; and
(e) (consents) each member of the REACH Group has obtained all
business and other consents of a material nature necessary
for the conduct of its business; and
(f) (validity of obligations) each Obligor's obligations under
the Transaction Documents are valid and binding and are
enforceable against it in accordance with their terms
subject to any applicable bankruptcy, insolvency,
reorganisation, liquidation or other similar laws or
regulations affecting creditor's rights generally and the
general principles of equity or of the kinds referred to in
the legal opinions reasonably required by the Financiers in
connection with the Security Documents; and
(g) [intentionally left blank]
(h) (solvency) each member of the REACH Group is not Insolvent;
and
(i) (not a trustee) no Obligor enters into any Transaction
Document as trustee of any trust or settlement; and
(j) (ownership of property) each member of the REACH Group has
title to all property held by it free from any Security
Interest, other than any Permitted Security Interest; and
(k) [intentionally left blank]
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(l) (Event of Default) no Event of Default or Potential Event of
Default has occurred and continues unremedied; and
(m) [intentionally left blank]
(n) (no Material Adverse Effect) no event or circumstance has
occurred or arisen since the date of the most recent
Financial Statements given to the Financiers which has had
or would be reasonably likely to have a Material Adverse
Effect, save for any event or circumstance which has
specifically been waived by the Financiers as an event or
circumstance which has had or would be reasonably likely to
have a Material Adverse Effect; and
(o) [intentionally left blank]
(p) (ranking) each Obligor's payment obligations under the
Transaction Documents rank at least equally with the claims
of all its other unsecured and unsubordinated obligations,
except obligations mandatorily preferred by law; and
(q) (governing law) the choice of English law as the governing
law of this agreement will be recognised and enforced in its
jurisdiction of incorporation; and
(r) (security interest) subject to any qualifications in any
legal opinion given to the Financiers in connection
therewith, each Security Document creates (or, once entered
into, will create) in favour of the Financiers the Security
Interest which it is expressed to create with the ranking
and priority it is expressed to have; and
(s) (title) each Obligor has legal title to, and is the sole
beneficial owner of, the assets subject to the Security
Interest created by it pursuant to any Security Document,
free from all Security Interest except the Security Interest
created pursuant to, or permitted by, the Transaction
Documents.
11.2 Repetition of representations and warranties
The representations and warranties set out in clause 11.1 are taken to
be also made on the last day of each Interest Period by reference to
the facts and circumstances then existing.
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12 Undertakings
12.1 Positive undertakings
Each of REACH and the Borrower undertakes (unless the Financiers
otherwise consent):
(a) [intentionally left blank]
(b) [intentionally left blank]
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(c) [intentionally left blank]
(d) [intentionally left blank]
(e) [intentionally left blank]
(f) [intentionally left blank]
(g) (status certificates) whenever reasonably requested by a
Financier in accordance with this agreement, to give the
Financiers a certificate signed by the chief financial
officer of REACH which states (as at the date to which the
Financial Statements were prepared):
(i) whether an Event of Default continues unremedied;
and
(ii) whether clause 16.11 ("New Guarantors") is
complied with; and
(h) [intentionally left blank]
(i) [intentionally left blank]
(j) [intentionally left blank]
(k) (New Guarantor) to give to the Financiers prompt written
notification of any member of the REACH Group which is
required to become a New Guarantor pursuant to clause 16.11
("New Guarantor"); and
(l) [intentionally left blank]
(m) [intentionally left blank]
(n) (maintain authorisations) to obtain, renew on time and
comply with the terms of each material authorisation
necessary for each Obligor to enter into the Transaction
Documents to which it is a party, to comply with its
obligations and exercise its rights under them and to allow
them to be enforced; and
(o) (compliance with laws) to ensure that each member of the
REACH Group complies with all laws to which it may be
subject, if failure to do so would give rise to a Material
Adverse Effect or result in the creation of a Permitted
Security Interest; and
(p) (notify defaults) if an Event of Default or Potential Event
of Default occurs, to notify each Financier giving details
of the event and any step taken or proposed to remedy it;
and
(q) (ranking of obligations) to ensure that each Obligor's
payment obligations under the Transaction Documents rank and
will at all times rank at least equally with all its other
unsecured and unsubordinated obligations except obligations
mandatorily preferred by law; and
15
(r) [intentionally left blank]
(s) (Borrower shareholding) to ensure that, at all times, REACH
holds as legal and beneficial owner, all of the issued share
capital of the Borrower; and
(t) (Security Documents) to procure the cooperation of the
relevant Obligor with the Financiers and their lawyers in
relation to registrations, filings, stampings and issue of
legal opinions reasonably required by the Financiers in
connection with the Security Documents.
12.2 [intentionally left blank]
12.3 Negative undertakings
Each of REACH and the Borrower undertakes not to, and will ensure that
each member of the REACH Group does not (unless the Financiers
otherwise consent):
(a) (no Security Interests) create a Security Interest or allow
one to exist on the whole or any part of its present or
future property other than any Permitted Security Interest;
and
(b) (no disposal) dispose of (or agree to dispose of) all or a
part of its assets (either in a single transaction or in a
series of transactions whether related or not and whether
voluntarily or involuntarily) except for Permitted
Disposals; and
(c) (change business) do anything which will result in a
material change to the nature of the Core Business.
--------------------------------------------------------------------------------
13 Default
13.1 Events of Default
Each of the following is an Event of Default:
(a) (non-payment - Transaction Document) the Obligor does not
pay on the due date for payment any amount payable by it
under any Transaction Document in the manner required under
it unless the non-payment is caused by an administrative
error and payment is made within three Business Days of the
due date for payment; or
(b) (non-compliance with Security Document obligations) the
relevant Obligor does not comply with any obligation under
clause 12.1(t) ("Security Documents"); or
(c) (non-compliance with other obligations) the Obligor does not
comply with any other obligation under any Transaction
Document unless, if in the opinion of the Financiers (as
confirmed by a notice
16
from each of them to the Borrower) the non-compliance can be
remedied and, written evidence has been produced to the
reasonable satisfaction of the Financiers that the
non-compliance will be remedied and, the Obligor remedies
the non-compliance within 21 days after notice from the
Financiers; or
(d) (cross default) any indebtedness in respect of Borrowed
Money of any member of the REACH Group for amounts totalling
more than US$20,000,000 in aggregate is not paid when due or
within any originally applicable grace period or becomes
prematurely payable as a result of an event of default
(however described); or
(e) (enforcement against assets) distress is levied, or a
judgment or order is enforced, against a member of the REACH
Group or any of its assets for amounts totalling more than
US$20,000,000 in aggregate and is not discharged or stayed
within 30 days (or any shorter period as may be required by
relevant legislation); or
(f) (Security Interest enforceable) any Security Interest is
enforced against any property of any Obligor, or, unless it
is discharged within 21 days, against any other member of
the REACH Group provided that in each case the amount being
secured by that Security Interest equals to or is more than
US$10,000,000; or
(g) (incorrect representation or warranty) a representation or
warranty made by the Obligor, in connection with a
Transaction Document is found to have been incorrect or
misleading in a material respect when made; or
(h) (Insolvency) a member of the REACH Group becomes Insolvent
or any corporate action, legal proceedings or other
procedure or steps are taken for the Insolvency of any
member of the REACH Group, except any action, proceedings,
procedure or step which is:
(i) taken by a person other than a member of the REACH
Group; and
(ii) vexatious or frivolous and discharged within 60
days of its commencement; or
(i) (voidable Transaction Document) a Transaction Document or a
transaction in connection with it is or becomes (or is
claimed by an Obligor to be) wholly or partly void, voidable
or unenforceable or does not have (or is claimed by an
Obligor, not to have) the priority the Financiers intended
it to have; or
(j) (unlawfulness or repudiation) it is or becomes unlawful for
an Obligor to perform any of its material obligations under
this agreement or an Obligor repudiates this agreement; or
(k) (Material Adverse Effect) a change occurs in respect of the
REACH Group which has or will have a Material Adverse
Effect; or
17
(l) (Security) any Security Document, once executed, ceases to
be in full force and effect and does not create in favour of
the Financiers the Security which it is expressed to create
with the ranking and priority it is expressed to have
(subject to any qualification in any legal opinion given to
the Financiers in connection therewith).
13.2 Consequences of default
If an Event of Default occurs:
(a) in relation to REACH, the Borrower or a Material Subsidiary;
or
(b) in relation to a member of the REACH Group that is not a
Material Subsidiary and the occurrence of the Event of
Default has or will have a Material Adverse Effect,
then the Financiers may declare at any time by notice to the
Borrower that:
(c) an amount equal to the Total Amount Owing is either:
(i) payable on demand; or
(ii) immediately due for payment (whereupon the same
shall be due and payable together with accrued
interest thereon); and
(d) the Financiers' obligations specified in the notice are
terminated.
The Financiers agree that they may only make a declaration under this
clause 13.2 if they are unanimous in their agreement to do so. The
making of either declaration gives immediate effect to its provisions.
--------------------------------------------------------------------------------
14 Costs and indemnities
14.1 What the Borrower agrees to pay
The Borrower agrees to pay or reimburse (subject to any agreed cap):
(a) the reasonable Costs of each Financier in connection with:
(i) [intentionally left blank]
(ii) [intentionally left blank]
(iii) giving and considering consents, waivers,
variations, amendments, discharges and releases
and producing title documents; and
(iv) [intentionally left blank]
(v) reasonable legal expenses incurred in connection
with opinions issued in respect of any Security
Document,
including the reasonable legal expenses of each Financier
incurred in instructing or obtaining advice from their
counsel; and
18
(b) the Costs of each Financier in otherwise acting in
connection with the Transaction Documents, such as
exercising, enforcing or preserving rights (or considering
doing so), or doing anything in connection with any enquiry
by an authority involving a member of the REACH Group; and
(c) Taxes and fees (including registration fees) and fines and
penalties in respect of fees paid, or that a Financier
reasonably believes are payable, in connection with any
Transaction Document or a payment or receipt or any other
transaction contemplated by any Transaction Document.
However, the Borrower need not pay a fine or penalty in
connection with Taxes or fees to the extent that it has
placed the Financier in sufficient cleared funds for the
Financier to be able to pay the Taxes or fees by the due
date.
The Borrower agrees to pay amounts due under this clause on demand
from the relevant Financier.
The Financiers may debit any of these amounts to the Borrower's
account before asking the Borrower to pay.
These amounts are not payable to the extent that they are due to the
wilful misconduct or gross negligence of the Financier.
14.2 Indemnity
The Borrower indemnifies each Financier against any liability or loss
arising from, and any Costs (including Break Costs) incurred in
connection with:
(a) financial accommodation requested under a Transaction
Document not being provided in accordance with the request
for any reason except default or negligence of the
Financier; or
(b) financial accommodation under a Transaction Document being
repaid, discharged or made payable other than at its
maturity or on the last day of the relevant Interest Period
relating to that accommodation; or
(c) an Event of Default; or
(d) investigating any event which it reasonably believes is an
Event of Default or Potential Event of Default (but only if,
following that investigation, it is determined that an Event
of Default or Potential Event of Default had occurred).
The Borrower agrees to pay amounts due under this indemnity on demand
from the affected Financier.
14.3 Items included in loss, liability and Costs
The Borrower agrees that:
(a) the Costs referred to in clause 14.1 ("What the Borrower
agrees to pay"), and the liability, loss or Costs referred
to in clause 14.2
19
("Indemnity"), include reasonable legal Costs in accordance
with any written agreement as to legal costs (whether or not
the Borrower is a party to that agreement) or, if no
agreement, on whichever is the higher of a full indemnity
basis or solicitor and own client basis; and
(b) the Costs referred to in clause 14.1(a) and (b) ("What the
Borrower agrees to pay") include those paid, or that the
relevant Financier reasonably believes are payable, to
persons engaged by the relevant Financier in connection with
the Transaction Documents (such as consultants); and
(c) loss or liability and any Costs in any indemnity under the
Transaction Documents may include "Break Costs".
The loss, liability or Cost of a Financier to be indemnified under
clause 14.2(b) includes, without limitation, Break Costs of that
Financier relating to the Drawing or amount in question. Each
Financier must, as soon as reasonably practicable after demand by the
Borrower, provide a certificate confirming that the amount of its
Break Costs for any Interest Period in which they accrue.
14.4 Payment of third party losses
The Borrower agrees to pay on demand from a Financier an amount equal
to any liability or loss and any Costs of the kind referred to in
clause 14.2 ("Indemnity") suffered or incurred by any employee,
officer, agent or contractor of the Financier in relation to the
Transaction Documents.
14.5 Currency conversion on judgment debt
If any sum due from the Obligor under the Transaction Documents (
"Sum"), or any order, judgment or award given or made in relation to a
Sum, has to be converted from the currency ("First Currency") in which
that Sum is payable into another currency ("Second Currency") for the
purpose of:
(a) making or filing a claim or proof against the Obligor;
(b) obtaining or enforcing an order, judgment or award in
relation to any litigation or arbitration proceedings,
the Obligor indemnifies each Financier to whom that Sum is due against
any cost, loss or liability arising out of or as a result of the
conversion including any discrepancy between:
(i) the rate of exchange used to convert that Sum from
the First Currency into the Second Currency; and
(ii) the rate or rates of exchange available to that
person at the time of its receipt of that Sum.
The Borrower agrees to pay amounts due under this indemnity on demand
from the affected Financier.
20
--------------------------------------------------------------------------------
15 Interest on overdue amounts
15.1 Obligation to pay
If the Obligor does not pay any amount under a Transaction Document on
the due date for payment, the Obligor agrees to pay interest on that
amount at the Default Rate. The interest accrues daily from (and
including) the due date to (but excluding) the date of actual payment
and is calculated on actual days elapsed and a year of 360 days.
The Obligor agrees to pay interest under this clause on demand from
the Financiers.
15.2 Compounding
Interest payable under clause 15.1 ("Obligation to pay") which is not
paid when due for payment will be added to the overdue amount on the
last day of each Interest Period applicable to the overdue amount but
will remain immediately due and payable. Interest is payable on the
increased overdue amount at the Default Rate in the manner set out in
clause 15.1 ("Obligation to pay").
15.3 Interest following judgment
If a liability of an Obligor becomes merged in a judgment, that
Obligor agrees to pay interest on the amount of that liability as an
independent obligation. This interest:
(a) accrues daily from (and including) the date the liability
becomes due for payment both before and after the judgment
up to (but excluding) the date the liability is paid; and
(b) is calculated at the judgment rate or the Default Rate
(whichever is higher).
Clause 15.1 ("Obligation to pay") and clause 15.2 ("Compounding")
apply (with necessary changes) to this interest.
--------------------------------------------------------------------------------
16 Guarantee and indemnity
16.1 Consideration
Each Guarantor acknowledges incurring obligations and giving rights
under this Guarantee for valuable consideration received from the
Financiers.
16.2 Guarantee
Each Guarantor unconditionally and irrevocably guarantees payment to
each Financier of the Guaranteed Money and (in the case of REACH only)
punctual performance by the Borrower of all of its obligations under
the Transaction Documents. If the Borrower does not pay the Guaranteed
Money in accordance with the Transaction Documents, then each
Guarantor agrees to pay the Guaranteed Money on demand from the
Financiers. A demand
21
may be made at any time and from time to time and whether or not the
Financiers have made demand on the Borrower or any other person or
proceeded against or enforced any other rights or security against or
claimed payment from any person. Each Guarantor waives any right which
it may have of first requiring any Financier to take any action
specified in the previous sentence before making a demand against that
Guarantor and this waiver applies irrespective of any law or any
provisions of a Transaction Document to the contrary.
16.3 Nature of guarantee
The guarantee in clause 16.2 ("Guarantee") is a continuing obligation
despite any intervening payment, settlement or other thing and extends
to all of the Guaranteed Money.
16.4 Indemnity
Each Guarantor indemnifies each Financier against any liability or
loss arising, and any Costs they suffer or incur if the obligation
guaranteed is or becomes unenforceable, invalid or illegal.
Each Guarantor agrees to pay amounts due under this indemnity on
demand from the Financiers. A demand may be made at any time and from
time to time and whether or not the Financiers have made demand on the
Borrower or any other person or proceeded against or enforced any
other rights or security against or claimed payment from any person.
Each Guarantor waives any right which it may have of first requiring
any Financier to do any of them before making a demand against it and
this waiver applies irrespective of any law or any provisions of a
Transaction Document to the contrary. The amount recoverable must not
exceed the amount the Financier would have otherwise been entitled to
recover.
16.5 Reinstatement of rights
If any payment by any Guarantor or any discharge given by a Financier
(whether in respect of the obligations of that Guarantor or any
security for those obligations or otherwise) is avoided or reduced as
a result of insolvency or any similar event:
(a) the liability of that Guarantor continues as if the payment,
discharge, avoidance or reduction had not occurred; and
(b) each Financier is entitled to recover the value or amount of
that security or payment from that Guarantor, as if the
payment, discharge, avoidance or reduction had not occurred.
16.6 Rights of the Financiers are protected
Rights given to a Financier under this Guarantee (and each Guarantor's
liabilities under it) are not affected by any act or omission by the
Financier or any other person or by anything else that might otherwise
affect them under law or otherwise, including:
22
(a) the fact that they vary or novate any arrangement under
which the Guaranteed Money is expressed to be owing, such as
by increasing the Facility Limit, extending the term or
substituting a Financier; or
(b) the fact that they release the Borrower or any other person
or give it a concession, such as more time to pay; or
(c) the fact that the Borrower or an Obligor opens an account
with them; or
(d) the fact that they release any person who gives a guarantee
or indemnity in connection with any Obligor's obligations;
or
(e) the fact that a person becomes a Guarantor after the date of
this agreement (including under clause 16.12 ("Becoming a
New Guarantor")); or
(f) the fact that the obligations of any person who guarantees
any of the Borrower's obligations (including under this
Guarantee) may not be enforceable or any unenforceability,
illegality or invalidity of any obligation of any person
under any Transaction Document or any other document or
security; or
(g) the fact that any person who was intended to guarantee any
of the Borrower's obligations does not do so or does not do
so effectively; or
(h) the Insolvency of any person including a Guarantor or the
Borrower; or
(i) changes in the membership, name or business of any person;
or
(j) the fact that a person who is a co-surety or co-indemnifier
for payment of the Guaranteed Money is discharged under an
agreement or by operation of law; or
(k) the taking, variation, compromise, exchange, renewal or
release of, or refusal or neglect to perfect, take up or
enforce, any rights against, or security over assets of, any
Obligor or other person or any non-presentation or
non-observance of any formality or other requirement in
respect of any instrument or any failure to realise the full
value of any security; or
(l) any incapacity or lack of power, authority or legal
personality of or dissolution or change in the members or
status or an Obligor or any other person.
16.7 No merger
This Guarantee does not merge with or adversely affect, and is not
adversely affected by, any of the following:
(a) any other guarantee, indemnity, security or other right or
remedy to which the Financier is entitled; or
23
(b) a judgment which the Financier obtains against any Guarantor
in connection with the Guaranteed Money or any other amount
payable under this Guarantee.
The Financier may still exercise rights under this Guarantee as well
as under the judgment, other guarantee, indemnity, security, or other
right or remedy.
16.8 Extent of Guarantor's obligations
Each Guarantor is liable for all the obligations under this clause 16
both individually and jointly with any one or more of the Guarantors.
16.9 Guarantor's rights are suspended
As long as any of the Guaranteed Money remains unpaid, no Guarantor
may, without the Financiers' consent:
(a) reduce its liability under this Guarantee by claiming that
it or the Borrower or any other person has a right of
set-off or counterclaim against the Financier; or
(b) exercise any right to claim to be entitled to or otherwise
take the benefit (in whole or part and whether by way of
subrogation or otherwise) of any rights of any Financier
under the Transaction Documents or any other guarantee,
indemnity or security given in connection with the
Guaranteed Money or any Obligor's obligations under the
Transaction Documents any other amount payable under this
Guarantee; or
(c) claim an amount from the Borrower, or another guarantor of
the Guaranteed Money (including a person who has signed this
agreement as a "Guarantor"), under a right of indemnity; or
(d) claim an amount in the Insolvency of the Borrower or of
another guarantor of the Guaranteed Money (including a
person who has signed this agreement as a "Guarantor").
16.10 Suspense account
A Financier may place in an interest-bearing suspense account any
payment it receives from any Guarantor (and any net interest on that
payment after tax) for as long as it reasonably thinks prudent and
may, but need not, apply the payment or net interest towards
satisfying the Guaranteed Money or any other obligations of that
Guarantor under the Transaction Documents.
16.11 New Guarantors
In relation to any member of the REACH Group which is not REACH, the
Borrower or an Initial Guarantor, if it becomes a Material Subsidiary
or if its indebtedness exceeds, or in the case of paragraph (a) below,
on its incurring further indebtedness, would exceed:
(a) in respect of Borrowed Money, an aggregate principal amount
of US$5,000,000; or
24
(b) in respect of any other indebtedness of the kind which is
included in the consolidated Financial Statements of the
REACH Group delivered in accordance with this agreement as
"accounts payable, including trade and other creditors and
accruals", an aggregate principal amount of US$50,000,000,
then, unless the Financiers agree otherwise, each Obligor agrees to
ensure that the person (to the extent legally permissible where that
person becomes a New Guarantor under paragraph (b) above) becomes a
New Guarantor in accordance with clause 16.12 ("Becoming a New
Guarantor"):
(i) in the case of any person which would exceed the
threshold in paragraph (a) above by incurring
further indebtedness for Borrowed Money on or
before the date of that person incurring the
indebtedness for Borrowed Money;
(ii) otherwise, in the case of any person which becomes
a Material Subsidiary or whose indebtedness
exceeds the threshold in paragraph (b) above,
within 30 days of the Borrower or REACH becoming
aware of the event (being a date no later than the
date on which the relevant Financial Statements
disclosing the event are required to be delivered
under this agreement or a longer period agreed by
the Financiers); and
(iii) in any other circumstances, within a reasonable
time.
16.12 Becoming a New Guarantor
A member of the REACH Group must become a New Guarantor by becoming a
party to this agreement as a Guarantor (after the date of this
agreement) by signing and delivering to each Financier a deed poll
(substantially in the form of schedule 5 ("Form of New Guarantor Deed
Poll")), giving the Financiers the documentation referred to in
paragraphs 1, 2, 3, 4, 5, 6, 7 and 8 of schedule 1 ("New Guarantor
documentation") in relation to it and doing any other thing the
Financiers reasonably requests to ensure the enforceability of that
member's obligations as a Guarantor; or executing any other guarantee
document in a form agreed with the Financiers (but no more onerous to
the New Guarantor than this Guarantee) giving the Financiers the
documentation referred to in paragraphs 1, 2, 3, 4, 5, 6, 7 and 8 of
schedule 1 ("New Guarantor documentation") in relation to it and doing
any other thing the Financiers reasonably request to ensure the
enforceability of that member's obligations as a Guarantor (and
references in this agreement to the "Guarantee" will include that
guarantee document).
Unless the Financiers agree otherwise, a New Guarantor must also,
immediately upon executing the New Guarantor Deed Poll:
(a) execute a floating charge agreement (in substantially the
same form as the existing Floating Charges or in any other
form reasonably satisfactory to the Financers) or if a
floating charge is not recognised or applicable in any
relevant jurisdiction, another form of security agreed by
the Financiers (acting reasonably); cooperate with the
25
Financiers and their lawyers in relation to any legal
opinion which the Financiers may reasonably require to be
issued in connection with that security document; and comply
with undertakings contained in that security document
(including the making of the necessary registrations to
ensure the enforceability of the security conferred by that
security document); and
(b) procure the execution of a share charge agreement (in
substantially the same form as the existing Share Charges or
in any other form reasonably satisfactory to the Financers)
or if a share charge is not recognised or applicable in any
relevant jurisdiction, another form of security agreed by
the Financiers (acting reasonably) by its shareholder(s) who
will thereby become a Chargor, the cooperation of its
shareholder(s) with the Financiers and their lawyers in
relation to any legal opinion which the Financiers may
reasonably require to be issued in connection with that
security document and the compliance of its shareholder(s)
with all undertakings by the Chargor under that security
document (including the delivery of the documents and the
making of the necessary registrations to ensure the
enforceability of the security conferred by that security
document).
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17 [intentionally left blank]
18 [intentionally left blank]
19 [intentionally left blank]
20 [intentionally left blank]
21 [intentionally left blank]
22 [intentionally left blank]
23 [intentionally left blank]
24 [intentionally left blank]
25 [intentionally left blank]
26 [intentionally left blank]
26
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27 Relationships between parties
27.1 [intentionally left blank]
27.2 Financiers not responsible for Obligors' conduct
No Financier has any responsibility to the Obligors or to the other
Financier for any Obligor's compliance or non-compliance with the
Transaction Documents.
27.3 Financier's obligations several
The obligations of each Financier under the Transaction Documents are
several. A failure by a Financier to perform its obligations under the
Transaction Documents does not affect the obligations of the Obligor.
No Financier is liable for the failure by any other Financier to
perform its obligations.
27.4 Financiers' rights several
Subject to clause 27.5 ("Financiers agree to exercise rights
jointly"), the rights of each Financier are several. Any debt arising
under the Transaction Documents at any time from the Obligor to any of
the other parties to this agreement is a separate and independent
debt.
27.5 Financiers agree to exercise rights jointly
Despite clause 27.4 ("Financiers' rights several), the Financiers
agree that:
(a) neither of the Financiers may exercise any right or
discretion under or in connection with the Transaction
Documents without the other Financer's consent; and
(b) all actions that a Financier may take under or in connection
with the Transaction Documents must be exercised jointly
with the other Financier.
--------------------------------------------------------------------------------
28 Dealing with interests
28.1 No dealing by Obligor
The Obligor may not assign or otherwise deal with its rights under any
Transaction Document or allow any interest in them to arise or be
varied, in each case, without the Financiers' consent.
28.2 Dealings by Financier
Subject to clauses 28.2(b) and 28.3 ("Dealings by Financiers require
consent"):
(a) a Financier may assign, novate, transfer or otherwise deal
with its rights and obligations under this agreement after
consultation with the Borrower, except that:
27
(i) consultation with the Borrower is not required if
all or any part of the Financier's right and
obligations are assigned, transferred or novated
to any Related Entity of the Financier; and
(ii) the Borrower is not obliged to pay any amounts
payable to or for the account of the assignee or
transferee of the Financier under clause 8
("Withholding tax") or clause 9 ("Increased
costs") if those amounts were payable at the time
of the assignment, novation or transfer, the
assignee or transferee was aware of those amounts
and the amounts would not have been payable if the
assignment, novation or transfer had not been
made; and
(b) a Financier may, after consultation with the Borrower,
assign, transfer, sub-participate or otherwise deal with all
or any part of its benefit under this agreement to any
Related Entity, trustee of a trust or a corporate vehicle
established for the purposes of securitisation, so long as
the Financier remains the lender of record in respect of
this agreement; and
(c) a Financier may disclose to any assignee, transferee or
sub-participator under this clause 28.2 any information in
relation to the Transaction Documents or in relation to the
Obligor or the REACH Group (including the existence of or
contents of any Transaction Document, any transactions
contemplated by the Transaction Documents and the existence
and content of any discussions in connection with the
Transaction Documents) as that person reasonably requires
without the Obligor's consent or the need to provide any
notice to the Borrower.
28.3 Dealings by Financiers require consent
Despite clause 28.2 ("Dealings by Financiers"), the Financiers agree
that neither Financer may deal with its rights and obligations under
this agreement or any of the other Transaction Documents without the
other Financier's consent.
--------------------------------------------------------------------------------
29 Notices
29.1 Form
Unless expressly stated otherwise in the Transaction Document, all
notices, certificates, consents, approvals, waivers and other
communications in connection with that Transaction Document must be in
writing, signed by an Authorised Officer of the sender and marked for
attention as set out or referred to in the Details on the relevant
Transfer Certificate or, if the recipient has notified otherwise,
marked for attention in the way last notified.
29.2 Delivery
They must be:
28
(a) left at the address set out or referred to in the Details;
or
(b) sent by prepaid post (airmail, if appropriate) to the
address set out or referred to in the Details; or
(c) sent by fax to the fax number set out or referred to in the
Details.
However, if the intended recipient has notified a changed postal
address or changed fax number, then the communication must be to that
address or number.
29.3 When effective
They take effect from the time they are received unless a later time
is specified in them.
29.4 Deemed receipt - postal
If sent by post, they are taken to be received three days after
posting (or seven days after posting if sent to or from a place
outside Hong Kong).
29.5 Deemed receipt - fax
If sent by fax, they are taken to be received at the time shown if
entirely legible in the transmission report as the time that the whole
fax was sent.
29.6 Deemed receipt - general
Despite clauses 29.4 ("Deemed receipt - postal") and 29.5 ("Deemed
receipt - fax"), if they are received after 5.00 pm in a place of
receipt or on a non-Business Day, they are taken to be received at
9.00 am on the next Business Day.
29.7 Notices to Financiers
Any communication or document to be made or delivered to a Financier,
as the case may be, will be effective only when actually received by
it and then only if it is marked for the attention of the department
or officer set out in the Details (or any substitute department or
officer as it specifies for this purpose).
29.8 Notices to and from Obligors
(a) All notices from or to the Obligor must be sent to each
Financier.
(b) Any communication or document made or delivered to the
Borrower in accordance with this clause is taken to have
been made or delivered to each Obligor.
29.9 English language
(a) Any notice given under or in connection with any Transaction
Document must be in English.
29
(b) All other documents provided under or in connection with any
Transaction Document must be:
(i) in English; or
(ii) if not in English, and if required by a Financier,
accompanied by a certified English translation
and, in this case, the English translation
prevails unless the document is a constitutional,
statutory or other official document.
29.10 Waiver of notice period
The Financiers may waive a period of notice required to be given by a
Borrower to them under this agreement.
--------------------------------------------------------------------------------
30 General
30.1 Application to Transaction Documents
If anything in this clause 30 ("General") is inconsistent with a
provision in another Transaction Document, then the provision in the
other Transaction Document prevails for the purposes of that
Transaction Document.
30.2 Prompt performance
If a Transaction Document specifies when the Obligor agrees to perform
an obligation, the Obligor agrees to perform it by the time specified.
The Obligor agrees to perform all other obligations promptly.
30.3 Consents
The Obligor agrees to comply with all conditions in any consent a
Financier gives in connection with a Transaction Document.
30.4 Certificates
A Financier may give the Obligor a certificate about an amount payable
or other matter in connection with a Transaction Document. The
certificate is sufficient evidence of the amount or matter, unless it
is proved to be incorrect.
30.5 Set-off
At any time after the Financiers have made a declaration under clause
13.2(c)(ii), a Financier may set-off any matured obligation owed by
that Financier to the Obligor against any matured obligation owed by
the Obligor to that Financier under the Transaction Documents,
regardless of the place of payment, booking branch or currency of the
matured obligation.
30
30.6 Discretion in exercising rights
A Financier may exercise a right or remedy or give or refuse its
consent under a Transaction Document in any way it considers
appropriate (including by imposing conditions).
30.7 Partial exercising of rights
If a Financier does not exercise a right or remedy under a Transaction
Document in whole or in part or at a given time the Financier may
still exercise it later.
30.8 No liability for loss
A Financier is not liable for loss caused by the exercise or attempted
exercise of, failure to exercise, or delay in exercising, a right or
remedy under a Transaction Document.
30.9 Conflict of interest
A Financier's rights and remedies under any Transaction Document may
be exercised even if this involves a conflict of duty or the Financier
has a personal interest in their exercise.
30.10 Remedies cumulative
The rights and remedies of the Financier under any Transaction
Document are in addition to other rights and remedies given by law
independently of the Transaction Document.
30.11 Indemnities
Any indemnity in a Transaction Document is a continuing obligation,
independent of the Obligor's other obligations under that Transaction
Document and continues after the Transaction Document ends. It is not
necessary for the Financier to incur expense or make payment before
enforcing a right of indemnity under a Transaction Document.
30.12 Rights and obligations are unaffected
Rights given to the Financier under a Transaction Document and the
Obligor's liabilities under it are not affected by anything which
might otherwise affect them at law.
30.13 Inconsistent law
To the extent permitted by law, each Transaction Document prevails to
the extent it is inconsistent with any law.
30.14 Partial invalidity
If, at any time, any provision of the Transaction Documents is or
becomes illegal, invalid or unenforceable in any respect under any law
of any jurisdiction, neither the legality, validity or enforceability
of the remaining
31
provisions nor the legality, validity or enforceability of the
provision under the law of any other jurisdiction will be affected or
impaired.
30.15 Supervening legislation
Any present or future legislation which operates to vary the
obligations of the Obligor in connection with a Transaction Document
with the result that the Financier's rights, powers or remedies are
adversely affected (including by way of delay or postponement) is
excluded except to the extent that its exclusion is prohibited or
rendered ineffective by law.
30.16 Time of the essence
Time is of the essence in any Transaction Document in respect of an
obligation of the Obligor to pay money.
30.17 Variation and waiver
A provision of a Transaction Document, or right created under it, may
not be waived or varied except in writing signed by the party or
parties to be bound.
30.18 Confidentiality
Each party agrees not to disclose information provided under or in
connection with any Transaction Document by any other party (including
the existence of or contents of any Transaction Document, any
transactions contemplated by the Transaction Documents and the
existence and content of any discussions in connection with the
Transaction Documents except:
(a) to officers, employees, legal and other advisers and
auditors of the Obligor or a Financier and its Related
Entities to the extent they require to know such information
for the due performance of their duties; or
(b) to any party to this agreement or any Related Entity of any
party to this agreement, provided the recipient agrees to
act consistently with this clause 30.18; or
(c) with the consent of the party who provided the information
(such consent not to be unreasonably withheld); or
(d) as required by any law, stock exchange or prudential or
other authority to whom financial institutions are required
to provide further information; or
(e) as expressly permitted under the Transaction Documents; or
(f) to the extent such information is in the public domain
through no failure on the part of any person to preserve
confidentiality.
Each party consents to disclosures made in accordance with this clause
30.18.
32
30.19 Further steps
The Obligor agrees to do anything the Financiers ask (such as
obtaining consents, signing and producing documents and getting
documents completed and signed):
(a) to bind the Obligor and any other person intended to be
bound under the Transaction Documents; and
(b) to show whether the Obligor is complying with the
Transaction Documents.
30.20 Counterparts
This agreement may consist of a number of copies, each signed by one
or more parties to the agreement. If so, the signed copies are treated
as making up the one document.
30.21 Accounts
In any litigation or arbitration proceedings arising out of or in
connection with a Transaction Document, the entries made in the
accounts maintained by a Financier are prima facie evidence of the
matters to which they relate.
30.22 Applicable law
Each Transaction Document is governed by the law in force in the place
specified in the Details (or if another law is specified in the
Transaction Document, then by that law).
30.23 Serving documents
Without preventing any other method of service, any document in a
court action may be served on a party by being delivered to or left at
that party's address for service of notices under clause 29
("Notices").
30.24 Serving of process
Without prejudice to any other mode of service allowed under any
relevant law, the Obligor:
(a) irrevocably appoints Simmlaw Services Limited as its agent
for service of process in relation to any proceedings before
the English courts in connection with any Transaction
Document; and
(b) agrees that failure by a process agent to notify the Obligor
of the process will not invalidate the proceedings
concerned.
30.25 Jurisdiction of English courts
The parties agree that:
(a) the courts of England have exclusive jurisdiction to settle
any dispute arising out of or in connection with this
agreement (including a
33
dispute regarding the existence, validity or termination of
this agreement) (a "Dispute");
(b) the courts of England are the most appropriate and
convenient courts to settle Disputes and accordingly no
party will argue to the contrary; and
(c) this clause is for the benefit of each Financier only and
does not prevent any Financier from taking proceedings
relating to a Dispute in any other courts with jurisdiction.
To the extent allowed by law, each Financier may take
concurrent proceedings in any number of jurisdictions.
30.26 Third party rights
A person who is not, or has not become, a party to this agreement has
no rights under the Contracts (Rights of Third Parties) Act 1999 (UK)
to enforce any term of this agreement.
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31 Interpretation
31.1 Definitions
These meanings apply unless the contrary intention appears:
Accountable Taxes means Taxes imposed by a Relevant Country other than
those imposed on, or calculated having regard to, the net income of a
Financier.
Amendment and Restatement Agreement means the agreement of that name
dated on or about 16 June 2004 between the parties to this agreement.
Amount Owing means, at any time for a Financier, the total of all
amounts which are then due for payment, or which will or may become
due for payment, in connection with any Transaction Document
(including transactions in connection with them) to that Financier.
Authorisation means an authorisation, consent, approval, resolution,
licence, exemption, filing, notarisation or registration.
Authorised Officer means:
(a) in the case of a Financier, a director or secretary of the
Financier or an officer of that party whose title contains
the word "president", "vice-president", "director", "chief",
"head", "counsel" or "manager", or a person performing the
functions of any of them, or any other person appointed by
that party as an Authorised Officer for the purposes of the
Transaction Documents; and
(b) in the case of the Obligor, a person appointed by the
Obligor as an Authorised Officer for the purposes of the
Transaction Documents and in respect of which each Financier
has received a certificate signed by a director or secretary
of the Obligor setting out the name
34
and signature of the person and confirming the person's
authority to act as an Authorised Officer.
Borrowed Money means (without duplication) any indebtedness (other
than indebtedness owing to another member of the REACH Group and, for
the avoidance of doubt, any indebtedness owing under the CPP
Agreement) for or in respect of:
(a) any 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;
(d) the amount of any liability in respect of any lease or hire
purchase contract which would, in accordance with applicable
generally accepted accounting principles be treated as a
finance or capital lease;
(e) the amount of any liability in respect of any advance or
deferred purchase agreement if the primary reasons for
entering into such agreement is to raise finance;
(f) receivables sold or discounted (other than on a non-recourse
basis);
(g) any agreement or option to re-acquire an asset if one of the
primary reasons for entering into such agreement or option is
to raise finance;
(h) any amount raised under any other transaction (including any
forward sale or purchase agreement) having the commercial
effect of a borrowing; and
(i) the amount of any liability in respect of any guarantee or
indemnity for any of the items referred to in paragraphs (a)
to (h) above.
Borrower means REACH Finance Limited (formerly known as Capital Next
Limited).
Break Costs means, in relation to a Financier, the amount (if any) by
which:
(a) the interest which the Financier should have received for
the period from the date of receipt of all or any part of
its participation in a Drawing to the last day of the
current Interest Period in respect of that Drawing, had the
principal amount been paid on the last day of that Interest
Period
exceeds
(b) the amount which that Financier would be able to obtain by
placing an amount equal to the principal amount received by
it on deposit with a leading bank in the London interbank
market for a period starting on the Business day following
receipt or recovery and ending on the last day of the
current Interest Period.
35
Business Day means a day (not being a Saturday, Sunday or public
holiday) on which banks are open for general banking business in
Australia, Hong Kong, London and New York.
Chargor means each of:
(a) REACH;
(b) Reach Global Networks Limited;
(c) Reach Networks Australia Pty Limited; and
(d) Reach Networks Hong Kong Limited,
and any other person who becomes a Chargor under clause 16.12(c).
Control of an entity (the "controlled entity") means the capacity of
one or more entities together to direct the decision-making of the
board of directors of the controlled entity in relation to the
financial and operating policies of the controlled entity.
Core Business means in relation to the REACH Group taken as a whole,
the global supply of a telecommunications service that provides
capacity and connectivity for the carriage of telecommunications
traffic as contemplated in the Shareholders Agreement.
Costs includes costs, charges and expenses, including those incurred
in connection with advisers.
CPP Agreement means the Capacity Pre-Prepayment Agreement dated 15
April 2003 between PCCW, Telstra, REACH Global Services Limited,
REACH, REACH Networks Hong Kong Limited and PCCW-HKT (as amended on
the Effective Date).
Default Rate means the Interest Rate plus 1% per annum.
For the purpose of this definition, the Interest Rate is calculated as
if the overdue amount is a Drawing with Interest Periods of 3 months
(or another period chosen from time to time by the Financiers) with
the first Interest Period starting on and including the due date.
Details means the section of this agreement headed "Details".
Directive means a treaty, a law, a rule, a regulation, an official
directive or request or a guideline having the force of law, and an
official directive, request, guideline or policy with which financiers
generally (or financiers in the relevant jurisdiction generally)
comply, of any government, intergovernmental or supra-national body,
agency, department or regulatory, self-regulating or other authority
or organisation (including without limitation, a requirement or
request relating to the maintenance of capital or any other request or
requirement of a central bank or other regulatory body).
Drawing means a drawdown made or to be made under the Facility or the
outstanding principal amount of a drawdown made under the Facility.
36
Effective Date means the date on which the Financiers notify the
Borrower that they have each received each of the items set out in the
schedule ("Conditions precedent") to the Amendment and Restatement
Agreement in form and substance satisfactory to them.
Event of Default means an event so described in clause 13 ("Default").
Facility means each of the :
(a) Telstra Facility; and
(b) PCCW Facility,
made available under this agreement and Facilities means both of them.
Facility Limit means:
(a) for Telstra, the Telstra Facility Limit; and
(b) for PCCW, the PCCW Facility Limit,
and Facility Limits means both of them.
Final Maturity Date means 31 December 2010.
Financier means any person so described in the Details.
Financial Statements means:
(a) a profit and loss statement; and
(b) a balance sheet; and
(c) a statement of cash flows,
together with any notes to those documents and a directors'
declaration and other information as required under applicable law and
any other information necessary to give a true and fair view of the
financial condition of the relevant person.
Financial Year in respect of the Borrower, REACH or the REACH Group
means each period of a year ending on 31 December each year.
First Amendment and Restatement Agreement means the agreement dated 15
April 2003 between, among others, the Borrower, REACH and the Banks.
Floating Charge means each floating charge agreement executed by:
(a) REACH;
(b) Reach Global Networks Limited;
(c) Reach Networks Australia Limited; and
(d) Reach Networks Hong Kong Limited,
37
in favour of the Financiers, as well as any floating charge agreement
(or other security document) executed under clause 16.12(b).
Guarantee means the guarantee and indemnity in clause 16 ("Guarantee
and indemnity").
Guaranteed Money means, at any time, all amounts then due for payment
or which will or may become due for payment or which remain unpaid by
an Obligor in connection with the Transaction Documents (including
transactions in connection with them).
Without limiting this definition, it includes amounts then due for
payment or which will or may become due for payment or which remain
unpaid to a Financier in its capacity as an assignee because it has
taken an assignment of a Transaction Document, and whether or not:
(a) the Guarantor (or any other Obligor) was aware of the
assignment or consented to it; or
(b) the assigned obligation was secured before the assignment; or
(c) the assignment takes place before, at the same time as or
after the Transaction Document is executed.
Guarantor means any Initial Guarantor and each New Guarantor under
clause 16.12 ("Becoming a New Guarantor").
Hong Kong means the Hong Kong Special Administration Region of the
People's Republic of China.
Initial Guarantor means REACH and each person so described in the
Details.
Indirect Tax means any goods and services tax, consumption tax, value
added tax or any tax of a similar nature.
A person is Insolvent if:
(a) an order is made or an effective resolution has been passed
for it to be wound up, or dissolved without winding-up
(otherwise than for the purposes of reconstruction or
amalgamation);
(b) a receiver, receiver manager, judicial manager, liquidator,
provisional liquidator, official manager, administrator,
trustee or like official has been appointed over the whole
or any material part of its undertaking or property;
(c) any distress, execution, sequestration or other similar
process has been levied or enforced upon or sued out against
the whole or any material part of its property and has
remained undischarged for a continuous period of more than
30 days;
(d) it has made an assignment for the benefit of creditors
(including a class of creditors) generally;
38
(e) it is subject to any arrangement, assignment, moratorium or
composition, protected from creditors under any statute or
dissolved (in each case, other than to carry out a
reconstruction or amalgamation while solvent on terms
approved in writing by the Financiers);
(f) it is unable or admits inability to pay its debts as they
fall due, suspends making payments on any of its debts or,
by reason of actual or anticipated financial difficulties,
commences negotiations with its creditors generally to
reschedule any or all of its indebtedness; or
(g) a situation substantially analogous to any of (a) to (f)
exists in connection with the person under the law of any
jurisdiction.
Interest Payment Date means the last day of an Interest Period.
Interest Period means each period selected in accordance with clause 3
("Interest") or applicable in accordance with the definition of
Default Rate.
Interest Rate means for Drawings, the interest rate set out in the
Details.
LIBOR means, with respect to any Drawing for any Interest Period:
(a) the rate per annum (rounded upwards, if necessary, to the
nearest four decimal places) equal to the official fixing
rate by the British Banker Association for USD conducted
each day at 11.00am (London time) which appear on the page
of the Reuters Monitor Money Rates Service (or, if not
available, a successor or substitute page or service
selected by the Financiers after consultation with the
Borrower) which displays London interbank offered rates for
the currency of the Drawing (being current "LIBOR01" for
US$) for the Interest Period (or any period which may, in
the Financiers' reasonable opinion, be comparable to the
Interest Period) as of 11:00a.m. London time on the
quotation date for the Interest Period (or a comparable
period, as the case may be); or
(b) if that rate is not available at that time for any reason,
the rate per annum (rounded upwards, if necessary, to the
fourth decimal point) equal to the arithmetic mean of the
rates at which deposits for a maturity comparable to the
Interest Period are offered by the Reference Banks to prime
banks in the London interbank market (as notified to the
Financiers) in immediately available funds and in the
currency of the Drawing at approximately 11.00 am, London
time on the quotation date for that Interest Period.
For the purposes of this definition:
(i) the "quotation date" for an Interest Period is the
day on which quotations would ordinarily be given
by prime banks in the London interbank market for
deposits in the relevant currency for delivery on
the first day of that Interest Period, except, if,
for the period, quotations would ordinarily be
given on more than one date, the "quotation date"
for that period is the last of those dates; and
39
(ii) if a Reference Bank fails to supply the Financiers
with a quotation required of it, the relevant rate
for which the quotation was required must be
determined from those quotations which are
supplied to the Financiers by other Reference
Banks (unless only one Reference Bank supplies a
quotation).
Margin is as described in the Details.
Material Adverse Effect means:
(a) a material adverse effect on the business, assets or
financial condition of the REACH Group taken as a whole
unless a substantial cause of such effect is a deterioration
or failure of the industry of providing connectivity
services for the carriage of telecommunications traffic;
(b) a material adverse effect on the ability of an Obligor to
perform fully and punctually its payment obligations under
this agreement unless a substantial cause of such effect is
a deterioration or failure of the industry of providing
connectivity services for the carriage of telecommunications
traffic; or
(c) a material adverse effect on the validity, legality or
enforceability of any Security Interest created or to be
created pursuant to the Security Documents or on the
priority and ranking of any of that Security Interest.
Material Subsidiary means from time to time each member of the REACH
Group whose share of the book value of the tangible assets or the
gross revenues of the REACH Group exceeds 10% of the consolidated
tangible assets or gross revenues of the REACH Group, as specified in
the most recent consolidated Financial Statements of the REACH Group
from time to time.
New Guarantor means any person that becomes a Guarantor under clause
16.12 ("Becoming a New Guarantor").
New Guarantor Deed Poll means a deed in the form of schedule 5 ("Form
of New Guarantor Deed Poll") or any other guarantee document executed
by a New Guarantor under clause 16.12 ("Becoming a New Guarantor").
Obligor means each of the Borrower and the Guarantors.
PCCW means the person so described in the Details.
PCCW Facility means the Facility so described in the Details.
PCCW Facility Limit has the meaning given to it in the Details.
PCCW-HKT means PCW-HKT Telephone Limited.
PCCW Shareholder means Pacific Century Cable Holdings Limited a
company incorporated in Bermuda and having its principal office at
Xxxxxxxxx Xxxxx, 0 Xxxxxx Xxxxxx, Xxxxxxxx XX 11, Bermuda.
40
Permitted Disposal means any disposal:
(a) of assets not required for the operations of the Core
Business made on arm's length commercial terms; or
(b) of assets in exchange for other assets comparable or
superior as to type, value and quality (however, the
Financiers need not treat other assets as comparable or
superior to the extent that the value of the Borrower's net
economic interest free from Permitted Security Interests in
the other assets is less than the value of that interest in
the assets disposed of); or
(c) by the payment of cash, dividends or interest on stock or
management charges; or
(d) required by law, regulation or licence or by any regulatory
body or authority; or
(e) of obsolete assets or assets no longer required for the
business; or
(f) by way of operating leases entered into by a member of the
REACH Group as lessor in the ordinary course of the business
of the relevant member of the REACH Group or the REACH Group
taken as a whole; or
(g) by a Guarantor to another Guarantor or to another person who
agrees, or who has agreed with the Financiers that it will
become a New Guarantor in accordance with this agreement; or
(h) not falling within the paragraphs (a) to (g) above (both
present and future) so long as the aggregate of the Disposed
Value of those assets falling within this paragraph (h) and
disposed of by the members of the REACH Group in any
Financial Year does not exceed 20% of the book value of the
total consolidated tangible assets of the REACH Group as
specified in the most recent consolidated Financial
Statements of the REACH Group for such Financial Year.
For the purpose of this paragraph (h):
"Disposed Value" of any asset of any member of the REACH
Group means the higher of:
(i) the amount of aggregate consideration (or its
value, if in kind) received by the members of the
REACH Group for the disposal of the asset, net of
costs incurred in respect of the disposal; and
(ii) the book value of the asset.
Permitted Security Interest means:
(a) any lien or right of set-off arising by operation of law and
in the normal course of the business of a member of the
REACH Group or in respect of Taxes; and
41
(b) each Security Interest over or affecting any asset acquired
by a member of the REACH Group after the date of this
agreement and subject to which the asset is acquired if:
(i) the Security Interest was not created in
contemplation of the acquisition of the asset by
the relevant member of the REACH Group; and
(ii) the principal amount secured by it immediately
before the asset was acquired does not exceed
either its then resale value or its original cost
and has not been increased in contemplation of, or
since the date of, the acquisition of the asset by
the relevant member of the REACH Group; and
(iii) the Security Interest is fully discharged and
released within six months of the date of
acquisition of the asset; and
(c) each Security Interest over or affecting any asset of any
company which becomes a member of the REACH Group after the
date of this agreement created before the company becomes a
member of the REACH Group if:
(i) the Security Interest was not created in
contemplation of the company becoming a member of
the REACH Group; and
(ii) the amount secured by the Security Interest has
not been increased in contemplation of the company
becoming a member of the REACH Group; and
(iii) the Security Interest is fully discharged and
released within six months of the date on which
the company becomes a member of the REACH Group;
and
(iv) the Security Interest and the transactions
relevant to it were created or entered into on
arm's length terms; and
(d) each Security Interest arising out of rights of
consolidation, combination, netting or set-off over any
current or deposit accounts with a bank or financial
institution, where it is necessary to agree to those rights
in connection with any treasury management arrangement
operated by a member of the REACH Group; and
(e) each Security Interest over assets securing Borrowed Money
incurred to finance the costs of acquiring, developing or
improving assets where the person providing the Borrowed
Money only has recourse to those assets (and, in the case of
Security Interests over assets securing Borrowed Money
incurred to finance the cost of improving an asset, if the
total amount secured by those Security Interests does not
exceed US$100,000,000); and
(f) any Security Interest replacing, or renewing any Permitted
Security Interest and which secures a maximum principal,
capital or nominal
42
amount not exceeding that so originally secured at the time
it is replaced; and
(g) any Security Interest disclosed in writing to the Banks
pursuant to the terms of schedule 2 of the First Amendment
and Restatement Agreement; and
(h) any Security Interest arising out of or in connection with a
judgment or judicial award which is promptly discharged; and
(i) any other Security Interest created in favour of the
Financiers, either pursuant to any Floating Charge, any
Share Charge or otherwise with the consent of the
Financiers; and
(j) any other Security Interest over or affecting the assets of
the Borrower or a member of the REACH Group not falling in
paragraphs (a) to (i) above (both present and future) so
long as the aggregate amount secured by all those Security
Interests falling under this paragraph (j) and those
Security Interests permitted by paragraph (f) which are in
replacement or renewal of Security Interests originally
permitted under this paragraph (j) from time to time does
not exceed 20% of the total consolidated tangible assets of
the REACH Group as specified in the most recent consolidated
Financial Statements of the REACH Group.
Potential Event of Default means an event of which the Borrower is
aware (whether by notice to it by any Financier or not) which, with
the giving of notice, the expiry of a grace period or making of a
determination under a Transaction Document or any combination of them,
would become an Event of Default.
Proportion means at any time, for a Financier, the proportion which
the Facility Limit for its Facility bears to the aggregate of the
Facility Limits.
Protected Party means any Financier which is or will be, for or on
account of Taxes, subject to any liability or required to make any
payment in relation to a sum received or receivable (or any sum deemed
for the purposes of Taxes to be received or receivable) under a
Transaction Document.
REACH means REACH Ltd. (formerly known as Joint Venture (Bermuda) No.
1 Limited), a company incorporated in Bermuda and having its principal
office at Xxxxxxxxx Xxxxx, 0 Xxxxxx Xxxxxx, PO Box HM666, Xxxxxxxx XX
CX, Bermuda.
REACH Group means REACH and its Subsidiaries from time to time.
Reference Banks means:
(a) each of the financial institutions so described in the
Details; and
(b) any other banks or financial institutions the Borrower and
the Financiers from time to time agree to be Reference
Banks.
There must be at least three Reference Banks at any time.
43
Related Entity of a body corporate is any other body corporate of
which the first mentioned body corporate is a Subsidiary and any other
Subsidiary of the second mentioned body corporate (including any
Subsidiary of the first mentioned body corporate).
Release Date means the date on which the releases under the Deed of
Release between the Obligors, the Financiers, JPMorgan Chase Bank and
others dated on or about the date of this agreement become effective.
Relevant Country means any country, or political sub-division of one
or more countries, or any federation or association of countries in
which the Obligor is either incorporated or is resident or domiciled
for any tax purpose or in which the Obligor carries on business or
owns or leases property or from which, or through which, any payment
under a Transaction Document is made.
Security Documents means the Floating Charges, the Share Charges, and
any other security document that may be at any time given as security
for any of the Total Amount Owing.
Security Interest means any mortgage, pledge, lien, hypothecation,
charge, security, encumbrance, assignment or deposit by way of
security or trust arrangement for the purpose of providing security or
any arrangement having a similar effect to any of them.
Share Charge means each share charge agreement executed by:
(a) REACH over its shares in the Borrower;
(b) REACH over its shares in Reach Global Networks Limited;
(c) Reach Global Networks Limited over its shares in Reach
Networks Australia Limited; and
(d) Reach International Holdings Limited over its shares in
Reach Networks Hong Kong Limited,
in favour of the Financiers, as well as any share charge agreement (or
other security document) executed under clause 16.12(c).
Shareholders Agreement means the agreement entitled "IP Backbone
Company Shareholders Agreement" dated 13 October 2000 between Telstra,
Telstra Holding, Telstra Shareholder, PCCW, PCCW Shareholder and the
Borrower.
An entity is a Subsidiary of another entity if that other entity
(directly or indirectly):
(a) holds a majority of the voting rights in it; or
(b) has the right to appoint or remove a majority of its board
of directors or equivalent body (or directors or similar
officers holding a majority of the voting rights of the
board of directors or equivalent body) whether through
ownership, contract or otherwise; or
44
(c) is entitled to control the exercise of, a majority of the
voting rights in it; or
(d) if the entity is a Subsidiary of an entity which is itself a
Subsidiary of that other entity.
Taxes means taxes, levies, imposts, charges and duties (including
stamp and transaction duties) and withholdings imposed by any
authority together with any related interest, penalties, fines and
expenses in connection with them.
Telstra means the person so described in the Details.
Telstra Facility means the Facility so described in the Details.
Telstra Facility Limit has the meaning given to it in the Details.
Telstra Holding means Telstra Holdings Pty Limited (ABN 45 057 808
938).
Telstra Shareholder means Telstra Holdings (Bermuda) No. 1 Limited a
company incorporated in Bermuda and having its principal office at
Xxxxxxxxx Xxxxx, 0 Xxxxxx Xxxxxx, Xxxxxxxx XX 00, Bermuda.
Total Amount Owing means, at any time, the total of all Amounts Owing
in connection with any Transaction Document (including transactions in
connection with them).
Transaction Documents means the documents described as such in the
Details and any document which the Borrower and the Financiers agree
in writing to be a Transaction Document.
US Dollars and US$ means the lawful currency of the United States of
America.
Working Capital Facility Agreement means the working capital facility
agreement dated on or about the date of the Amendment and Restatement
Agreement between REACH, Telstra and PCCW.
31.2 References to certain general terms
Unless the contrary intention appears, a reference in a Transaction
Document to:
(a) a group of persons is a reference to any two or more of them
jointly and to each of them individually;
(b) an agreement, representation or warranty in favour of two or
more persons is for the benefit of them jointly and each of
them individually;
(c) an agreement, representation or warranty by two or more
persons binds them jointly and each of them individually,
but an agreement, representation or warranty by a Financier
binds the Financier individually only;
45
(d) anything (including an amount) is a reference to the whole
and each part of it;
(e) a document (including this agreement) includes any
variation, amendment, novation or replacement of it;
(f) law means international treaty, common law, principles of
equity, and laws made by parliament or competent legislative
bodies or organs of government, any international tribunal,
board or other authority established under any international
treaty subordinate legislation regulation, and rules (and
laws made by any international tribunal, board or other
authority established under any international treaty or
parliament include multi-jurisdictional and regulations and
other instruments under them) and consolidations,
amendments, re-enactments or replacements of any of them;
(g) an accounting term is a reference to that term as it is used
in accounting standards under GAAP, or, if not inconsistent
with those standards, in accounting principles and practices
generally accepted in the United States of America;
(h) a time of day is a reference to Hong Kong time;
(i) the word "person" includes an individual, a firm, company,
corporation, other body corporate, government, authority,
state or agency of a state or any association, trust or
partnership (whether or not having separate legal
personality) of two or more of them;
(j) a particular person includes a reference to the person's
executors, administrators, successors, substitutes
(including persons taking by novation) and assigns;
(k) the words "including", "for example" or "such as" when
introducing an example, do not limit the meaning of the
words to which the example relates to that example or
examples of a similar kind;
(l) the "equivalent" in any currency (the "first currency") of
any amount in another currency (the "second currency") is a
reference to the amount in the first currency which could be
purchased with that amount in the second currency at the
spot rate of exchange at which the Financiers would have
been prepared (acting reasonably) and able to purchase that
amount in the first currency for the second currency in the
London foreign exchange market for value as at the relevant
time on the relevant date specified in this agreement (or,
where no time and date is specified, for value at the time
and on the date as the Financiers may from time to time
reasonably determine to be appropriate in the
circumstances);
(m) "assets" includes present and future properties, revenues
and rights of every description;
46
(n) "indebtedness" includes any obligation (whether incurred as
principal or as surety) for the payment or repayment of
money, whether present or future, actual or contingent;
(o) a "quarter" means each period of 3 months ending on 31
March, 30 June, 30 September and 31 December in any
Financial Year; and "quarterly" shall be construed
accordingly;
(p) a "regulation" includes any regulation, rule, official
directive, request or guideline (whether or not having the
force of law) of any governmental, intergovernmental or
supra-national body, agency, department or regulatory,
self-regulatory or other authority or organisation;
(q) a thing done or to be done in the "ordinary course of
business" is a reference to a thing done or to be done in
the ordinary course of the Core Business.
A Potential Event of Default or an Event of Default is "continuing" if it has
not been remedied or waived.
31.3 Number
In a Transaction Document, the singular includes the plural and vice
versa.
31.4 Headings
In a Transaction Document, headings (including those in brackets at
the beginning of paragraphs) are for convenience only and do not
affect the interpretation of the Transaction Document.
EXECUTED as an agreement.
47
Shareholder Term Loan Facility Agreement
Schedules
Schedule 1 - New Guarantor documentation (clause 16.12)
Item Form
1. Memorandum and articles of association (or Certified copy
equivalent) of the relevant Guarantor.
2. Certificate of registration (or equivalent) of the Certified copy
relevant Guarantor.
3. Extract of minutes of a meeting of the relevant Certified copy
Guarantor's board of directors (or equivalent) which evidences
the resolutions:
(a) authorising the signing and delivery of the Transaction
Documents to which the person is a party and the
observance of obligations under those documents; and
(b) appointing Authorised Officers of the person; and
(c) which acknowledge that the Transaction Documents to
which the person is a party will benefit it.
certified as true and correct and stating that the resolutions
are in full force and effect and have not been amended or
revoked.
4. Extract of the minutes of a meeting of the Certified copy
shareholders (or equivalent) of the relevant
Guarantor which evidence the resolutions authorising
the signing and delivery of the Transaction
Documents to which the person is a party and the
observance of obligations under those documents
certified as true and correct and stating that the
resolutions are in full force and effect and have
not been amended or revoked.
5. Each document which evidences any other necessary Certified copy
corporate or other action of the
48
relevant Guarantor in connection
with the Transaction Documents to which it is a party.
6. Each authorisation of the relevant Guarantor Certified copy
necessary to enter into the Transaction Documents to which it is
a party and to comply with obligations under and enforce those
documents.
7. Each power of attorney under which a person signs a Certified Copy
Transaction Document for the relevant Guarantor showing
evidence of stamping and registration (if required).
8. Certified specimen signature of: Original
(a) each Authorised Officer of the relevant Guarantor; and
(b) each other person who is authorised to sign a
Transaction Document for the relevant Guarantor.
49
Shareholder Term Loan Facility Agreement
Schedules
Schedule 2 - [intentionally left blank]
50
Shareholder Term Loan Facility Agreement
Schedules
Schedule 3 - [intentionally left blank]
51
Shareholder Term Loan Facility Agreement
Schedules
Schedule 4 - Payment details (clause 5.4)
Payment details Telstra Corporation Limited
Account number: 00000000
Account name: Telstra Corporation Limited
Bank: Citibank N.A.
Branch: New York
Swift Code: XXXXXX00
CHIPS/ABA number: CP0008/FW000000000
PCCW Limited
Account number: 000044407
Account name: HSBC, Hong Kong Main Branch
Bank: HSBC Bank USA, New York
Branch: Hong Kong Main Branch
Swift Code: MRMDUUS33
CHIPS/ABA number: 076026
Further credit to: PCCW Limited
Account number: 600 000 000 0000
52
Shareholder Term Loan Facility Agreement
Schedules
Schedule 5 - Form of New Guarantor Deed Poll (clause 16.12)
Deed Poll
--------------------------------------------------------------------------------
New Guarantor Name:
Address:
Fax:
Telephone:
Attention:
--------------------------------------------------------------------------------
Shareholder Term Shareholder Term Loan Facility Agreement between REACH
Loan Facility Finance Limited, Telstra, PCCW and others dated
Agreement 12 January 2001.
--------------------------------------------------------------------------------
Governing law of The same as the Shareholder Term Loan Facility Agreement
this deed poll described above.
BY THIS DEED POLL the New Guarantor described above, for the benefit of the
parties to the Shareholder Term Loan Facility Agreement described above:
(a) irrevocably agrees that from the date of this deed poll it is a
Guarantor; and
(b) irrevocably agrees to comply with and be bound by all current and
future obligations of the Guarantor under the Transaction Documents as
if it were originally party to them as a Guarantor; and
(c) acknowledges having read a copy of each Transaction Document before
signing this deed poll; and
(d) gives, as at the date of this deed poll, all representations and
warranties on the part of the Guarantor contained in the Transaction
Documents; and
(e) acknowledges receiving valuable consideration for this deed poll.
Clause 31 ("Interpretation") of the Shareholder Term Loan Facility Agreement
described above applies to this deed poll as if it was fully set out in this
deed poll.
DATED [ ]
EXECUTED as a deed poll.
53
[insert execution clause for New Guarantor]
54
Shareholder Term Loan Facility Agreement
Schedules
Schedule 6 - [intentionally left blank]
55
Shareholder Term Loan Facility Agreement
Schedules
Schedule 7 - [intentionally left blank]
56
Shareholder Term Loan Facility Agreement
Schedules
Schedule 8 - [intentionally left blank]
57
Shareholder Term Loan Facility Agreement
Schedules
Schedule 9 - [intentionally left blank]
58
Shareholder Term Loan Facility Agreement
Schedules
Schedule 10 - [intentionally left blank]
59
