Exhibit 10.58
CONFORMED COPY
THIS SHARE CHARGE is made as a deed on 29 March 2007
BETWEEN:
(1) 3COM TECHNOLOGIES, a company incorporated under the laws of the Cayman
Islands whose registered office is at c/x Xxxxxx and Xxxxxx,
Attorneys-at-Law, Xxxxxx House, South Church Street, Xxxxxx Town, Grand
Cayman, Cayman Islands (the "CHARGOR"); and
(2) INDUSTRIAL AND COMMERCIAL BANK OF CHINA (ASIA) LIMITED, a limited liability
company incorporated under the laws of Hong Kong whose registered office is
at 33rd Floor, ICBC Tower, 3 Garden Road, Central, Hong Kong (in its
capacity as collateral agent, the "COLLATERAL AGENT", which expression
shall, wherever the context so admits, include such entity and all other
persons from time to time acting in such capacity).
WHEREAS:
(A) By the Facility Agreement, the Lenders have agreed to make Term Loans to
the Borrower upon the terms and subject to the conditions contained
therein.
(B) As security for the Chargor's obligations under the Facility Agreement, the
Chargor has agreed to enter into this Deed.
NOW THIS DEED WITNESSES as follows:
1. INTERPRETATION AND DEFINITIONS
1.1 DEFINITIONS
In this Deed, unless the context otherwise requires:
"BORROWER" means H3C Holdings Limited;
"BUSINESS DAY" means a day (other than a Saturday or a Sunday) on which
banks are generally open for business in Hong Kong;
"CHARGE" means the security from time to time constituted by or pursuant to
this Deed (or intended to be constituted by or pursuant to this Deed) or
any part thereof;
"CHARGED PROPERTY" means any or all of the rights, title and interest,
present and future, in and to the Shares, Further Shares and Derived Assets
expressed to be subject to the security created under Clause 3 (Charge) of
this Deed;
"CONVEYANCING AND PROPERTY ORDINANCE" means the Conveyancing and Property
Ordinance (Cap. 219) of the laws of Hong Kong;
Equitable Share Charge
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"DEBT SERVICE ACCOUNT" means the bank account defined as such in the
Borrower Charge over Bank Accounts entered into on 22 March 2007 by H3C
Holdings Limited and the Collateral Agent;
"DERIVED ASSETS" means all shares, rights or other property of a capital
nature which accrue or are offered, issued or paid at any time (by way of
bonus, rights, redemption, conversion, exchange, substitution,
consolidation, subdivision, preference, warrant, option, purchase or
otherwise) in respect of:
(A) the Shares; or
(B) any Further Shares; or
(C) any shares, rights or other property previously accruing, offered,
issued or paid as mentioned in this definition;
"DIVIDENDS" means all dividends, interest and other income paid or payable
in respect of the Shares, any Further Shares or any Derived Assets;
"FACILITY AGREEMENT" means the senior secured credit and guaranty agreement
dated 22 March 2007 and signed by or on behalf of, amongst others, the
Chargor and the Collateral Agent, as amended, supplemented and/or restated
from time to time in any manner whatsoever;
"FURTHER SHARES" means all shares (other than the Shares and any shares
comprised in any Derived Assets) which the Chargor and the Collateral Agent
may at any time agree shall be subject to the Charge;
"POWERS OF ATTORNEY ORDINANCE" means the Powers of Attorney Ordinance (Cap.
31) of the laws of Hong Kong;
"RECEIVER" means a receiver appointed by or on behalf of the Collateral
Agent under this Deed or pursuant to the Collateral Agent's statutory
powers, and includes more than one such receiver and substituted receiver;
"SECURED INDEBTEDNESS" means the moneys, liabilities and obligations
(whether actual or contingent and whether owed jointly and severally or in
any other capacity whatsoever) of the Chargor which are, or are expressed
to be, or may at any time in the future be due and owing to the Collateral
Agent (whether for its own account or as agent or trustee for the Secured
Parties) or to any of the Secured Parties under or in connection with the
Facility Agreement together with all costs, charges and expenses incurred
by the Collateral Agent or any Secured Party which are, or are expressed to
be, or may become due and owing by the Chargor under or in connection with
the Facility Agreement; and
"SHARES" means the shares comprising all the issued capital of Huawei-3Com
Co., Limited more particularly described in Schedule 1 (Particulars of the
Shares).
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1.2 DEFINITIONS IN THE FACILITY AGREEMENT
Unless a contrary indication appears, a term used in the Facility Agreement
has the same meaning when used in this Deed.
1.3 CONVEYANCING AND PROPERTY ORDINANCE
In the context of the rights, powers, privileges, discretions and
immunities conferred on the Collateral Agent, any Receiver or any Attorney
(as defined in Clause 15 (Power of Attorney), references to "mortgage" and
"mortgaged land" in any provision of the Conveyancing and Property
Ordinance shall, for the purposes of this Deed, be deemed to be references
to the Charge and the Charged Property respectively.
2. COVENANT TO PAY AND NATURE OF SECURED INDEBTEDNESS
2.1 COVENANT TO PAY
The Chargor hereby covenants with the Collateral Agent that it shall pay
and discharge the Secured Indebtedness at the time and in the manner
provided for in the Facility Agreement and the Chargor hereby creates the
Charge in the Charged Property in the manner and on the terms set out in
Clause 3 (Charge).
2.2 NATURE OF SECURED INDEBTEDNESS
Each transfer, assignment, mortgage and charge hereunder expressed to be
to, each undertaking and agreement hereunder expressed to be to or with,
and each representation and warranty hereunder expressed to be given to,
the Collateral Agent is to, with or, as the case may be, given to the
Collateral Agent for itself and as agent and trustee for the Secured
Parties from time to time. Without prejudice to the generality of the
foregoing or Clause 1.2 (Definitions in the Facility Agreement), any
reference in this Deed to the Chargor, the Collateral Agent or any Secured
Party shall be construed so as to include their respective successors and
permitted assigns or transferees.
2.3 LIMITED RECOURSE
The maximum liability of the Chargor hereunder shall be limited to an
amount equal to the amount recovered through the enforcement of the
security over the Charged Property provided by the Chargor hereunder, and
if the amount so recovered is less than the aggregate amount otherwise
payable by the Chargor to the Secured Parties and the Collateral Agent
hereunder, the liability of the Chargor shall be limited to such amounts
recovered and the Collateral Agent shall have no rights to xxx the Chargor
for payment of any amount expressed to be payable under Clause 2.1 hereof
or otherwise under this Deed except to the extent necessary for such
enforcement.
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3. CHARGE
3.1 The Chargor, as beneficial owner and as continuing security for the payment
and discharge of all Secured Indebtedness, charges all its rights, title
and interest in and to the Charged Property by way of first fixed charge in
favour of the Collateral Agent.
3.2 TRANSFER
It is acknowledged and agreed that the Chargor shall be entitled to, and
shall, transfer all of the Shares to the Borrower as envisaged by the
Facility Agreement, including section 5.11 thereof, notwithstanding the
creation of this Charge, and that upon the Shares being registered in the
name of the Borrower pursuant to such transfer the Collateral Agent shall,
at the cost of the Chargor, promptly discharge, release and/or re-assign
or, as appropriate, transfer the benefit of so much of the Charged Property
as has not been applied by the Collateral Agent in or towards satisfaction
of the Secured Indebtedness, to the Chargor or as the Chargor may direct
and, thereafter, the Chargor shall have no further obligation hereunder.
4. COVENANT TO DEPOSIT AND FURTHER ASSURANCES
4.1 THE SHARES AND FURTHER SHARES
The Chargor shall, as soon as reasonably practicable (so as to permit time
for the transfer into the Chargor's name of 4,755,450 Shares purchased from
Seller pursuant to the Acquisition) as envisaged by section 5.11 of the
Facility Agreement in the case of the Shares, and within two Business Days
(or such longer period as the Collateral Agent may allow) of each occasion
on which the Collateral Agent and the Chargor agree that any Shares shall
become Further Shares, deposit with the Collateral Agent:-
(A) all share certificates, documents of title and other documentary
evidence of ownership in relation to such shares; and
(B) transfers of such shares duly executed by the Chargor or its nominee
with the name of the transferee left blank or, if the Collateral Agent
so requires, duly executed by the Chargor or its nominee in favour of
the Collateral Agent (or the Collateral Agent's nominee) and stamped,
and such other documents as the Collateral Agent may require to enable
the Collateral Agent (or the Collateral Agent's nominee) or, after the
Charge becomes enforceable, any purchaser to be registered as the
owner of, or otherwise to obtain legal title to, such shares;
(C) an executed letter of resignation and authorisation from each director
of Huawei-3Com Co., Limited, in a form satisfactory to the Collateral
Agent; and
(D) a resolution of the Board of Directors approving the transfers
referred to in Sub-clause (B).
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4.2 DERIVED ASSETS
The Chargor shall, within three Business Days of the accrual, offer, issue
or payment of any Derived Assets, deliver or pay to the Collateral Agent or
procure the delivery or payment to the Collateral Agent of:-
(A) all such Derived Assets or the share certificates, renounceable
certificates, letters of allotment, documents of title and other
documentary evidence of ownership in relation to them; and
(B) transfers of any shares comprised in such Derived Assets duly executed
by the Chargor or its nominee with the name of the transferee left
blank or, if the Collateral Agent so requires, duly executed by the
Chargor or its nominee in favour of the Collateral Agent (or the
Collateral Agent's nominee) and stamped, and such other documents as
the Collateral Agent may require to enable the Collateral Agent (or
the Collateral Agent's nominee) or, after the Charge becomes
enforceable, any purchaser to be registered as the owner of, or
otherwise to obtain legal title to, the shares comprised in such
Derived Assets.
4.3 FURTHER ASSURANCES
In addition to and without prejudice to anything else contained in this
Deed, the Chargor shall, at its own cost, promptly execute and do all such
deeds, instruments, transfers, renunciations, proxies, notices, documents,
assurances, acts and things in such form as the Collateral Agent may from
time to time require:-
(A) for converting the Charge to a legal mortgage over the Charged
Property pursuant to an exercise of the Collateral Agent's right under
Clause 10 (Effects of the Charge becoming Enforceable) of this Deed;
(B) for perfecting, preserving or protecting the Charge or the priority of
the Charge; and
(C) for facilitating the realisation of the Charge or the exercise of any
rights vested in the Collateral Agent.
4.4 REGISTRATION
Without limitation to the generality of the Clause 4.3 (Further
Assurances), the Chargor shall make all filings and registrations as may be
required by applicable laws or requested in writing by the Collateral Agent
from time to time as may be necessary to perfect, preserve and protect the
Charge.
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5. REDEMPTION
(A) Subject always to Clause 11.9 (Discharge Conditional), if the
Collateral Agent is satisfied, acting reasonably, that:
(i) all Secured Indebtedness have been unconditionally and
irrevocably paid or discharged in full and the Facility Agreement
has been terminated;
(ii) security or a guarantee for the Secured Indebtedness, in each
case acceptable to the Collateral Agent, has been provided in
substitution for this Deed; or
(iii) all of the Shares have been transferred to the Borrower, and
such Shares have been registered in the name of the Borrower as
contemplated by Clause 3.2 (Transfer),
then, the Collateral Agent shall at the request and cost of the
Chargor, promptly discharge, release and/or re-assign, or, as
appropriate, transfer the benefit of so much of the Charged Property
as has not been applied by the Collateral Agent in or towards
satisfaction of the Secured Indebtedness to the Chargor or as the
Chargor may direct and, thereafter, the Chargor shall have no future
obligation hereunder.
(B) The execution of a discharge, release, re-assignment, transfer or
partial discharge by the Collateral Agent shall be a good and valid
release or discharge of the Charge constituted by this Clause 3
(Charge) or the relevant part thereof (as the case may be) and the
obligations (or the relevant part thereof, as the case may be) of the
Chargor from this Deed without the need for the Chargor to be a party
thereto.
(C) The Collateral Agent hereby agrees that it shall, at the request and
cost of the Chargor, do all such things and execute all such documents
and procure that its nominees do all such things and execute all such
documents as may be reasonably necessary to give effect to the
discharge, release, re-assignment, transfer or partial discharge
referred to in Sub-clauses (A) and (B).
(D) Upon any release, discharge, re-assignment, transfer or partial
discharge pursuant to and in accordance with Sub-clause (A), the
Collateral Agent shall, at the request and cost of the Chargor:
(i) promptly procure the redelivery to the Chargor, if it requests
the same, of all deeds, instruments, certificates and other
documents delivered to or deposited with or to the order of the
Collateral Agent pursuant to Clause 4 (Covenant to Deposit and
Further Assurances); and
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(ii) promptly give notice to each person (if any) who has received
notice of the Charge pursuant to this Deed of such release,
discharge, re-assignment and/or transfer,
in each case to the extent the same relates to such release,
discharge, re-assignment, transfer or partial discharge.
6. THE SHARES
6.1 CHARGOR TO PAY CALLS AND OTHER PAYMENTS
The Chargor shall pay all calls or other payments due in respect of any
part of the Charged Property, and in any case of default by the Chargor in
this respect the Collateral Agent may (but shall not be obliged) if it
thinks fit make any such payment on behalf of the Chargor in which event
any sums so paid shall be reimbursed on demand by the Chargor to the
Collateral Agent and shall, until reimbursed, bear interest at the rate
provided in section 2.10 of the Facility Agreement.
6.2 All Dividends declared and distributed shall be paid directly to the Debt
Service Account in the amounts provided for in section 5.21 of the Facility
Agreement and the Chargor undertakes to procure that Huawei-3Com Co.,
Limited pays such Dividends to such accounts in such respective amounts.
7. REPRESENTATIONS AND WARRANTIES
The Chargor represents and warrants to the Collateral Agent that:-
(A) it is duly incorporated and validly existing under the laws of the
Cayman Islands and it has the power and capacity to enter into this
Charge and grant the security created hereunder;
(B) subject only to this Charge it is the sole beneficial owner of the
Shares;
(C) no Lien (other than the Permitted Liens) exists on, over or with
respect to any of the Charged Property;
(D) it has not sold, transferred, lent, assigned, parted with its interest
in, disposed of, granted any option in respect of or otherwise dealt
with any of its rights, title and interest in and to the Charged
Property, or agreed to do any of the foregoing (otherwise than
pursuant to this Deed or as permitted by the Facility Agreement);
(E) the Shares, any Further Shares and any shares comprised in any Derived
Assets are fully paid and there are no moneys or liabilities
outstanding in respect of any of them;
(F) the Shares, any Further Shares and any shares comprised in any Derived
Assets have been duly authorised and validly issued and are free from
any
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restrictions on transfer or rights of pre-emption, subject to the
articles of association of Huawei-3Com Co., Limited;
(G) it has the power to enter into, and perform and comply with its
obligations under, this Deed, and to create the Charge;
(H) the entry into and performance by it of, the creation of security
under, and the transactions contemplated by, this Charge do not and
will not conflict with:
(i) any law or regulation applicable to it;
(ii) its constitutional documents; or
(iii) any agreement or instrument binding upon or its Subsidiaries or
any of its or its Subsidiaries' assets;
(I) all actions, conditions and things required to be taken, fulfilled and
done (including the obtaining of any necessary consents) in order to
(i) enable it lawfully to enter into, and perform and comply with its
obligations under, this Deed, (ii) ensure that those obligations are
valid, legal, binding and enforceable, (iii) permit the creation of
the Charge and ensure that (subject to all necessary registrations
thereof being made) the Charge is a valid, legal, binding and
enforceable first fixed security interest over the Charged Property
ranking in priority to the interests of any liquidator, administrator
or creditor of the Chargor, and (iv) make this Deed admissible in
evidence in the courts of the Cayman Islands, Hong Kong and any other
relevant jurisdiction, have been taken, fulfilled and done;
(J) the obligations of the Chargor under this Deed and (subject to all
necessary registrations thereof being made) the Charge are and will be
until fully discharged valid, legal, binding and enforceable and the
Charge constitutes a first fixed security interest over the Charged
Property ranking in priority to the interests of any liquidator,
administrator or creditor of the Chargor; and
(K) each of the above representations and warranties will be correct and
complied with in all respects at all times during the continuance of
the Charge as if repeated then by reference to the then existing
circumstances.
8. COVENANTS AND UNDERTAKINGS
8.1 COVENANTS AND UNDERTAKINGS OF THE CHARGOR
The Chargor covenants and undertakes with the Collateral Agent that, except
with the consent of the Collateral Agent:
(A) it shall not sell, transfer, lend, assign, exchange, dispose of, grant
any option in respect of or otherwise deal with the whole or any of
its rights, title and interest in the Charged Property or agree to do
any of the foregoing other than as
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expressly permitted or provided for in the Facility Agreement or
pursuant to this Deed;
(B) other than as provided in the Facility Agreement or pursuant to this
Deed it shall not, nor shall it attempt to, create, incur or permit to
subsist any Lien on the Charged Property;
(C) it shall at all times give to the Collateral Agent such information as
the Collateral Agent may reasonably require in respect of the Charged
Property for the purpose of the discharge of the trusts, powers,
rights, duties, authorities and discretions vested in it hereunder or
by operation of law;
(D) it shall take all action within its power to procure, maintain in
effect and comply in all material respects with all the terms and
conditions of all approvals, authorisations, consents and
registrations necessary or appropriate for anything provided for on
its part in this Deed;
(E) it shall take all reasonable steps as may be required by the
Collateral Agent to allow the Collateral Agent to sell or dispose of
the Charged Property on or after the Charge becomes enforceable;
(F) it shall not do or cause or permit to be done, or omit to do anything
which may in any way adversely prejudice, affect or diminish the value
of any of the Charged Property;
(G) it shall ensure that there are no moneys or liabilities outstanding in
respect of any of the Charged Property;
(H) without prejudice to Clause 8.1(G), it shall punctually pay all calls,
subscription moneys and other moneys payable on or in respect of any
of the Charged Property and indemnify and keep indemnified the
Collateral Agent (and the Collateral Agent's nominees) against any
cost, liabilities or expenses which it or they may suffer or incur as
a result of any failure by the Chargor to pay the same;
(I) it shall ensure that the Shares, any Further Shares and any shares
comprised in any Derived Assets are free from any restriction on
transfer or rights of pre-emption, subject to the articles of
association of Huawei-3Com Co., Limited;
(J) it shall ensure that the Charge will at all times be a legally valid
and binding first fixed security interest over the Charged Property
ranking in priority to the interests of any liquidator, administrator
or creditor of the Chargor; and
(K) it shall deliver to the Collateral Agent a copy of every circular,
notice, report, set of accounts or other document received by the
Chargor in respect of or in connection with any of the Charged
Property forthwith upon receipt by the Chargor of such document.
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8.2 POWER OF COLLATERAL AGENT TO REMEDY FAILURES
If at any time the Chargor shall fail to comply with or perform any of the
covenants contained in this Deed or any Credit Document, the Collateral
Agent shall have the power on behalf of or in the name of the Chargor, but
shall not be under any obligation, to perform the covenants and to take
such steps which the Collateral Agent may in its discretion, consider
appropriate with a view to remedying, or mitigating the consequences of
such failure but so that the exercise of this power or the failure to
exercise it shall, in no circumstances, prejudice the other rights of the
Collateral Agent under this Deed or any Credit Document. The Chargor shall
on demand reimburse to the Collateral Agent all proper costs, expenses and
losses incurred or sustained by the Collateral Agent in connection with
such steps and until such costs, expenses and losses are reimbursed the
outstanding sums shall carry interest in accordance with section 2.10 of
the Facility Agreement from the date when payment is due to the date of
reimbursement and such outstanding sums including any accrued interest
shall form part of the Secured Indebtedness. No exercise by the Collateral
Agent of its powers under this Clause 8.2 (Power of Collateral Agent to
Remedy Failures) shall render the Collateral Agent liable to account as a
mortgagee in possession.
8.3 ISSUE OF FURTHER SHARES
It is agreed between the Chargor and the Collateral Agent that the Chargor
may at any time and from time to time procure the Borrower to issue further
shares to it, provided that all such shares issued shall constitute Further
Shares for the purposes of this Deed and shall be subject to the Charge.
9. DEFAULT PROCEDURE
The Charge shall become immediately enforceable:
(A) automatically upon the occurrence of any Event of Default described in
sections 8.1(f) or 8.1(g) of the Facility Agreement (except with
respect to Excluded Subsidiaries); and
(B) at the request of (or with the consent of) the Requisite Lenders and
upon notice to the Borrower by the Administrative Agent, upon the
occurrence of any other Event of Default (including those described in
sections 8.1(f) or 8.1(g) of the Facility Agreement with respect to
Excluded Subsidiaries).
10. EFFECTS OF THE CHARGE BECOMING ENFORCEABLE
10.1 EFFECTS
After the Charge (or the relevant part thereof) shall have become
enforceable in accordance with Clause 9 (Default Procedure) and without
prejudice to the powers of the Collateral Agent to appoint a Receiver
pursuant to Clause 13 (Appointment of Receiver):
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(A) the Collateral Agent shall be entitled to convert the Charge to a
legal mortgage over the Charged Property by completing the transfer of
the Charged Property to the Collateral Agent (or its nominee) and to
have its name (or the name of its nominee) entered onto the relevant
register of members; and
(B) the Chargor's rights or power to deal with the Charged Property
(whether statutory or otherwise) shall cease and the Collateral Agent
shall be entitled to deal with, collect in and realise the same in
such manner as the Collateral Agent thinks fit; and
(C) the Collateral Agent shall be entitled to exercise all powers in
respect of the Charged Property provided in Section 51 of and The
Fourth Schedule to the Conveyancing and Property Ordinance but without
the necessity to comply with any restrictions imposed by the
provisions of the said Section 51 or The Fourth Schedule; and
(D) the Collateral Agent may sell, realise or otherwise dispose of, for
such consideration (whether payable immediately or by instalments) as
it shall in its absolute discretion think fit (whether by private sale
or otherwise), the whole or any part of the Charged Property in
respect of which the security hereby constituted has become
enforceable and the Collateral Agent may to the extent that it has not
already done so, take possession of and hold all or any part of the
Charged Property and accordingly register, or cause to be registered
all or any of the Charged Property constituting shares in its own name
or in the name of the Collateral Agent's nominee or assignee or in the
name of any purchaser thereof and apply any of the Charged Property
constituting dividends or other distributions in cash as if they were
proceeds of sale of the Charged Property; and
(E) the provisions of paragraph 11 of The Fourth Schedule to the
Conveyancing and Property Ordinance shall not restrict the exercise by
the Collateral Agent or any Receiver of its powers hereunder and the
Charge shall become immediately enforceable and the statutory power of
sale and other powers of sale and appointing a Receiver shall become
immediately exercisable without any juridical or other formality or
any presentment, demand, protest or other notice of any kind on or at
any time after the Charge becomes enforceable; and
(F) without prejudice to the foregoing, the provisions of the Conveyancing
and Property Ordinance are expressly extended (subject to Clause 10.10
(Inconsistency and Conflict)) so that the Collateral Agent may in
addition to any powers granted it by applicable law, upon and from the
Charge becoming enforceable and upon and subject to the terms and
conditions of the Facility Agreement) do all such other acts and
things it may consider necessary or expedient for the realisation or
preservation of the Charged Property or incidental to the exercise of
any of the rights conferred on it under or in connection with this
Deed or the Conveyancing and Property Ordinance and to concur in the
doing of anything which it has the right to do and to do any such
thing jointly with any other person.
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10.2 OBLIGATIONS OF CHARGOR
After the Charge has become enforceable:-
(A) all Dividends shall be paid to and retained by the Collateral Agent,
and any such moneys which may be received by the Chargor shall,
pending such payment, be segregated from any other property of the
Chargor and held in trust for the Collateral Agent; and
(B) the Chargor shall procure that all voting and other rights relating to
the Charged Property are exercised in accordance with such
instructions (if any) as may from time to time be given to the Chargor
by the Collateral Agent, and the Chargor shall deliver to the
Collateral Agent such forms of proxy or other appropriate forms of
authorisation to enable the Collateral Agent to exercise such voting
and other rights.
10.3 ENTITLEMENT TO PAY EXPENSES AND OUTGOINGS
Subject to the order of priority of payments set out in section 2.16(h) of
the Facility Agreement, the Collateral Agent may pay and discharge the
expenses incurred (whether by the Collateral Agent, any Receiver or any
other person) in and about the carrying on and management of any such
business as contemplated by Clause 10.1 (Effects) or in the exercise of any
of the powers conferred by Clause 10.1 (Effects) or otherwise in respect of
the Charged Property and all outgoings which it shall think fit to pay out
of the profits and income of the Charged Property and the moneys received
by it in carrying out any business as contemplated by Clause 10.1 (Effects)
and may apply the residue of the said profits, income and moneys in the
manner provided by section 2.16(h) of the Facility Agreement provided that
any such expenses shall, in any event, to the extent not fully paid or
discharged, form or shall be deemed to form part of the Secured
Indebtedness.
10.4 NO WAIVER, REMEDIES CUMULATIVE
No failure or delay on the part of the Collateral Agent or any Receiver to
exercise any right, power or remedy under this Deed will operate as a
waiver thereof nor will any single or partial exercise of any right, power
or remedy preclude any other or further exercise thereof or the exercise of
any other right, power or remedy.
10.5 WAIVERS TO BE IN WRITING
Any waiver and any consent by the Collateral Agent under this Deed must be
in writing, be express and not implied and may be given subject to any
conditions which the Collateral Agent considers fit. Any waiver or consent
shall be effective only in the instance and for the purpose for which it is
given.
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10.6 NO OBLIGATION TO INSURE
Notwithstanding any provisions to the contrary, the Collateral Agent shall
not be under any obligation to insure any of the Charged Property or the
title deeds or other evidence in respect thereof and shall not be
responsible for any loss which may be suffered as a result of the lack of
or inadequacy of any such insurance.
10.7 NO RESPONSIBILITY FOR LOSSES
The Collateral Agent shall not be responsible for any loss or diminution in
the value occasioned to the Charged Property by any act or omission of the
Chargor or any prior ranking encumbrancer or any other person.
10.8 NO RESPONSIBILITY FOR TAX
The Collateral Agent shall have no responsibility whatsoever to any person
as regards any deficiency which might arise because the Collateral Agent is
subject to any tax, duties or levies in respect of the Charged Property or
any part thereof on any income therefrom or any proceeds thereof.
10.9 NO LIABILITY
The Collateral Agent shall not be liable for any failure, omission or
defect in perfecting the Charge or any security created by the Facility
Agreement or any of the Credit Documents.
10.10 INCONSISTENCY AND CONFLICT
To the maximum extent permitted by applicable law, where any inconsistency
or conflict exists between the provisions of this Deed and the provisions
of any applicable law (including without limitation the Conveyancing and
Property Ordinance and the Trustee Ordinance (Chapter 29 of the Laws of
Hong Kong)), the provisions of this Deed shall prevail and such
inconsistent or conflicting provisions shall be deemed to be expressly
negated or modified hereby provided that none of the foregoing shall be
construed as a limitation on the powers of any Receiver.
10.11 NO EXEMPTION
Nothing in this Deed shall exempt the Collateral Agent from or indemnify it
against any liability which would by rule of law or otherwise attach to it
in respect of any act of gross negligence or wilful default which it may
have committed in relation to its duties and/or discretions under this
Deed.
10.12 SUSPENSE ACCOUNT(S)
All monies received, recovered or realised by the Collateral Agent or a
Receiver under this Deed (including the proceeds of any conversion of
currency) after the security created hereunder has become enforceable,
except where such monies together with
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all other monies received, recovered or realised by the Collateral Agent or
any Receiver under this Deed are sufficient to satisfy and discharge the
Secured Indebtedness in full, may in the discretion of the Collateral Agent
or the Receiver (provided that such action has first been approved by the
Collateral Agent) be credited to any suspense or impersonal account in the
name of the Collateral Agent at Industrial and Commercial Bank of China and
may be held in such account for so long as the Collateral Agent may think
fit (with interest accruing thereon at such market rate, if any, as the
Collateral Agent may deem fit) pending their application from time to time
(as the Collateral Agent shall be entitled to do in its discretion) in or
towards satisfaction of the Secured Indebtedness in accordance with the
terms of this Deed. Save as provided above, no party shall be entitled to
withdraw any amount at any time standing to the credit of any such suspense
or impersonal account.
10.13 NEW ACCOUNT
At any time following (a) the Collateral Agent receiving notice (either
actual or constructive) of any subsequent Charge affecting the Charged
Property or (b) the Collateral Agent receives notice of any assignment or
disposition affecting all or any part of the Charged Property or any
interest therein to which the Collateral Agent has not given its approval
or (c) the commencement of the insolvency, administration, reorganisation
(other than as part of a solvent reconstruction or amalgamation the terms
of which have been approved in writing by the Collateral Agent),
liquidation or dissolution of, or any analogous proceeding in respect of,
of the Chargor, the Collateral Agent may open a new account in the name of
the Chargor (whether or not it permits any existing account to continue).
If the Collateral Agent does not open such a new account, it shall
nevertheless be treated as if it had done so at the time when the notice
was received or was deemed to have been received or, as the case may be,
the insolvency, administration, reorganisation, liquidation, dissolution or
other proceeding commenced. Thereafter, all payments made by the Chargor to
the Collateral Agent or received by the Collateral Agent for the account of
the Chargor shall be credited or treated as having been credited to the new
account and shall not operate to reduce the amount secured by this deed at
the time when the Collateral Agent received or was deemed to have received
such notice or, as the case may be, the insolvency, administration,
reorganisation, liquidation, dissolution or other proceeding commenced.
11. PRESERVATION OF RIGHTS
11.1 SECURITY ADDITIONAL
The Charge and the rights given to the Collateral Agent under this Deed
shall be in addition to and shall be independent of every guarantee,
indemnity or other security which the Collateral Agent may at any time hold
for the Secured Indebtedness and it is hereby declared that no prior
security held by the Collateral Agent over the whole or any part of the
Charged Property shall merge in the Charge.
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11.2 SECURITY CONTINUING
The Charge shall be a continuing security notwithstanding the winding-up or
dissolution of the Chargor or any partial payment, settlement of account or
other matter whatsoever and in particular (but without prejudice to the
generality of the foregoing) shall not be considered satisfied by any
intermediate repayment in satisfaction of all or any of the Secured
Indebtedness and shall continue in full force and effect until the Secured
Indebtedness has been discharged and satisfied in full.
11.3 INDULGENCE AND RELEASE
The Collateral Agent may (with the prior written consent of the Requisite
Lenders) in its discretion grant time or other indulgence, or make any
other arrangement variation or release with, the Chargor or any other
person (whether or not party hereto and whether or not jointly liable with
the Chargor) in respect of the Secured Indebtedness or of any other
security therefor or guarantee in respect thereof without prejudice either
to the Charge or to the liability of the Chargor for the Secured
Indebtedness.
11.4 RIGHTS CUMULATIVE
The rights, powers and remedies provided in this Deed are cumulative and
are not, nor are they to be construed as, exclusive of any rights, power or
remedies provided by law.
11.5 SECURITY NOT AFFECTED
Neither the Charge nor any of the rights, powers and remedies conferred
upon the Collateral Agent or any Receiver (or their respective delegates)
by this Deed or by law nor the liability of the Chargor hereunder shall be
discharged, impaired or otherwise affected by:
(A) any time, waiver or consent granted, or any other indulgence or
concession granted, by the Collateral Agent or any other Secured Party
to the Chargor or any other person; or
(B) the taking, holding, variation, compromise, exchange, renewal,
realisation or release by the Collateral Agent or any other Secured
Party or any other person of any rights under or in connection with a
Credit Document, any other security, guarantee, indemnity or other
document; or
(C) the refusal or failure to take up, hold, realise, perfect or enforce
by the Collateral Agent or any other Secured Party or any other person
any rights under or in connection with a Credit Document, any other
security, guarantee, indemnity or other document (including, without
limitation, any failure to comply with any formality or other
requirement or any failure to realise the full value of any security);
or
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(D) the existence of any claim, set-off or other right which the Chargor
may have at any time against the Collateral Agent or any other Secured
Party or any other person; or
(E) the making or absence of any demand for payment or discharge of any
Secured Indebtedness on the Chargor or any other person, whether by
the Collateral Agent or any other Secured Party or any other person;
or
(F) any arrangement, compromise or settlement entered into by the
Collateral Agent or any other Secured Party with the Chargor or any
other person; or
(G) any postponement, discharge, reduction, non-provability or other
similar circumstance affecting any obligation of the Chargor under a
Credit Document resulting from any insolvency, liquidation or
dissolution proceedings or from any law, regulation or order; or
(H) any variation, amendment, waiver, release, novation, supplement,
extension (whether of maturity or otherwise) or restatement (in each
case however fundamental and of whatsoever nature) or replacement of
any Credit Document, or any other security, guarantee, indemnity or
other document; or
(I) any amendment, variation, novation, supplementation or replacement of
any agreement between the Secured Parties; or
(J) any unenforceability, illegality or invalidity of any obligation of
any person under any Credit Document or any other security, guarantee,
indemnity or other document; or
(K) any of the obligations of the Chargor under any of Credit Document or
under any other Lien taken in respect of the obligations of the
Chargor under any Credit Document being or becoming illegal, invalid,
unenforceable, ineffective or impaired in any respect; or
(L) any amalgamation, merger or reconstruction that may be effected by the
Collateral Agent with any other person or any sale or transfer of the
whole or any part of the undertaking, property and assets of the
Collateral Agent to any other person; or
(M) any amalgamation, merger or reconstruction (other than as part of a
solvent reconstruction or amalgamation the terms of which have been
approved by the Collateral Agent), reorganisation, administration,
administrative or other receivership or dissolution or liquidation
entry into a voluntary arrangement of the Chargor or any other person;
or
(N) the insolvency, bankruptcy, winding-up or dissolution of the Chargor
or any change in its status, function, control or ownership; or
(O) any change in the constitution of the Chargor; or
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(P) any incapacity, lack of power, authority or legal personality of the
Chargor to enter into or perform any of its obligations under any
Credit Document to which it is a party or any irregularity in the
exercise thereof or any lack of authority by any person purporting to
act on their behalf; or
(Q) any exercise, omission to exercise, compromise, renewal or release of
any rights against the Chargor; or
(R) any invalidity or irregularity in the execution of this Deed or any
other Credit Document; or
(S) any other act (save for any valid act of release and discharge granted
by the Collateral Agent), event or omission which, but for this Clause
11.5 (Security Not Affected) might operate to discharge, impair or
otherwise affect the Charge or the liability of the Chargor for the
Secured Indebtedness or any of the rights, powers or remedies
conferred upon the Collateral Agent or any Receiver (or their
respective delegates) by this Deed or by law or the liability of the
Chargor hereunder.
Without prejudice to the generality of this Clause 11.5 (Security Not
Affected), the Chargor expressly confirms that it intends that its
liability for the Secured Indebtedness and its obligations under this Deed
shall extend from time to time to any variation, increase, extension,
addition or replacement (however fundamental) of or to any of the Credit
Documents and/or any facility or amount made available under any of the
Credit Documents.
11.6 NO PREJUDICE TO OTHER SECURITY
Nothing contained in this Deed is intended to, or shall operate so as to,
prejudice or affect any guarantee, indemnity or other security of any kind
whatsoever which the Collateral Agent may have for the Secured Indebtedness
or any right, remedy or privilege of the Collateral Agent thereunder.
11.7 SCOPE OF RELEASE
Any receipt, release or discharge of the Charge or of any liability arising
under this Deed may be given by the Collateral Agent and, unless expressly
stated otherwise, shall not release or discharge the Chargor from any
liability for the same or any other monies which may exist independently of
this Deed. Where such receipt, release or discharge relates only to part of
the Charged Property such receipt, release or discharge shall not prejudice
or affect the Charge in relation to the remainder of the Charged Property,
unless expressly stated otherwise.
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11.8 FURTHER ADVANCES
The security created by this Deed is intended to secure any further
advances made by the Lenders pursuant to the terms of the Facility
Agreement.
11.9 DISCHARGE CONDITIONAL
Any settlement, reassignment, release or discharge between the Chargor on
the one part and the Collateral Agent or any Receiver (or their respective
delegates) on the other (the Collateral Agent, any Receiver and their
respective delegates being referred to in this Clause 11.9 (Discharge
Conditional) as the "TRANSACTION PERSON(S)") shall be conditional upon no
security or payment by any person in respect of the Secured Indebtedness
being avoided or reduced by virtue of any provisions of law or enactments
(including but not limited to those relating to bankruptcy, insolvency or
liquidation) for the time being in force and, in the event of any such
security or payment being so avoided or reduced, the Transaction Person(s)
shall be entitled, to recover the value or amount of such payment and the
Charge subsequently as if such settlement or discharge had not occurred but
so that nothing herein shall confer on any Transaction Persons the right to
claim under this Clause 11.9 (Discharge Conditional) for more than the
Collateral Agent would be entitled to claim in aggregate hereunder in
respect of such avoided or reduced security or payment provided that any
such settlement, reassignment, release or discharge shall become
unconditional upon the expiry of one month after the maximum period within
which such settlement, reassignment, release or discharge can be avoided or
reduced.
11.10 NO CONDITIONS TO EXERCISE OF RIGHTS
Neither the Collateral Agent nor any Receiver nor any of their respective
delegates shall be obliged before exercising any of the rights, powers or
remedies conferred upon them by this Deed or by law:
(A) to take any action or obtain judgment in any court against the
Chargor;
(B) to make or file any claim or proof in a winding-up or dissolution of
the Chargor; or
(C) to enforce or seek to enforce the recovery of any moneys and
liabilities hereby secured or any other security taken in respect of
any of the obligations of the Chargor under any of the Credit
Documents.
12. PROTECTION OF PURCHASERS
No purchaser or other person dealing with the Collateral Agent or its
delegate or any Receiver appointed hereunder shall be bound to see or
inquire whether the right of the Collateral Agent or such Receiver to
exercise any of its or his powers has arisen or become exercisable or be
concerned to see whether any such delegation by the Collateral Agent shall
have lapsed for any reason or been revoked. Any sale or other dealing by
the Collateral Agent or its delegate or any Receiver of or with the Charged
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Property and any part thereof shall be deemed to be within the power of the
person effecting the same and the receipt by such person of the purchase or
other moneys connected therewith shall effectively discharge the purchaser
or other party to such dealing who shall not be concerned with the manner
of application of the proceeds of sale or other dealing or be in any way
answerable therefor.
13. APPOINTMENT OF RECEIVER
13.1 APPOINTMENT AND REMOVAL
The Collateral Agent may if requested by the Chargor or at any time after
the Charge (or the relevant part thereof) shall have become enforceable in
accordance with Clause 9 (Default Procedure), appoint one or more persons
to be a Receiver or Receivers of the whole or any part of the Charged
Property. The Collateral Agent may:
(A) remove any Receiver previously appointed hereunder; and
(B) appoint another person or other persons as Receiver or Receivers,
either in the place of a Receiver so removed or who has otherwise
ceased to act or to act jointly with a Receiver or Receivers
previously appointed hereunder.
If at any time and by virtue of any such appointment(s) any two or more
persons shall hold office as Receivers of the same assets or income, each
one of such Receivers shall be entitled (unless the contrary shall be
stated in any of the deed(s) or other instrument(s) appointing them) to
exercise all the powers and discretions hereby conferred on Receivers
individually and to the exclusion of the other or others of them.
13.2 POWERS OF RECEIVERS
Every Receiver for the time being holding office by virtue of an
appointment made by the Collateral Agent hereunder shall (subject to any
limitations or restrictions expressed in the deed or other instrument
appointing him but notwithstanding any winding-up or dissolution of the
Chargor) have, in relation to the Charged Property, or as the case may be,
that part of the Charged Property in respect of which he was appointed:
(A) all the powers (as varied and extended by the provisions hereof)
conferred by the Conveyancing and Property Ordinance or otherwise by
law on mortgagees (whether or not in possession) and receivers
appointed under the Conveyancing and Property Ordinance; and
(B) the power in the name or on behalf and at the cost of the Chargor to
exercise all the powers and rights of an absolute owner of the Charged
Property or the relevant part thereof and do or omit to do anything
which the Chargor could do.
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13.3 ADDITIONAL POWERS OF RECEIVERS
In addition and without prejudice to the generality of the foregoing every
Receiver shall (notwithstanding any winding-up or dissolution of the
Chargor) have the powers specified in Clause 10.1 (Effects).
13.4 RECEIVER TO BE AGENT OF THE CHARGOR
Every Receiver so appointed shall be deemed at all times and for all
purposes to be the agent of the Chargor and the Chargor shall be solely
responsible, jointly and severally, for the acts and defaults of such
Receiver (save in the case of the fraud, negligence, wilful default, breach
of duty or breach of trust in relation to duties by such Receiver) and for
payment of such Receiver's remuneration in respect thereof.
13.5 REMUNERATION OF RECEIVER
Every Receiver shall be entitled to remuneration for his services at a
reasonable rate to be fixed by agreement between him and the Collateral
Agent (or, failing such agreement, to be fixed by the Collateral Agent)
appropriate to the work and responsibilities involved upon the basis of
charging from time to time adopted in accordance with his current practice
or the current practice of his firm.
13.6 MONIES ACTUALLY PAID BY RECEIVER
Only monies actually paid by the Receiver to the Collateral Agent in
satisfaction of the Secured Indebtedness shall be capable of being applied
by the Collateral Agent in satisfaction thereof. The Receiver shall pay
over to the Collateral Agent any monies realised by the Receiver as a
result of the enforcement of the Charge (other than monies paid into a
suspense account by such Receiver in accordance with Clause 10.12 (Suspense
Account(s)).
13.7 LIMITATION OF LIABILITY
(A) Neither the Collateral Agent nor the Receiver nor any attorney or
agent of such party shall be liable to any person in respect of any
loss or damage whatsoever which arises out of the realisation of the
Charged Property or any part thereof or from any act, default or
omission in relation to the Charge or from any exercise or
non-exercise, or the attempted or purported exercise of, or the
failure to exercise any of their respective powers, authorities or
discretions conferred upon them in relation to the Charge or any part
of it, unless such loss or damage is caused by its or his negligence,
wilful default, breach of duty, breach of trust or fraud.
(B) Without prejudice to the generality of Sub-clause (A), entry into
possession of the Charged Property shall not render the Collateral
Agent or the Receiver liable to account as mortgagee in possession or
liable for any loss on realisation or for any default or omission for
which a mortgagee in possession might be liable unless such loss or
damage is caused by its negligence, wilful default,
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breach of duty, breach of trust or fraud and, if and whenever the
Collateral Agent or the Receiver enters into possession of the Charged
Property, it shall be entitled at any time to go out of such
possession.
13.8 POWER OF APPOINTMENT ADDITIONAL
The foregoing powers of appointment of a Receiver shall be in addition to
and not to the prejudice of all statutory and other powers of the
Collateral Agent under the Conveyancing and Property Ordinance (and so that
the statutory power of sale shall be exercisable without regard to
paragraph 11 of the Fourth Schedule to the said Ordinance) or otherwise and
so that such powers shall be and remain exercisable by the Collateral Agent
in respect of any part of the Charged Property in respect of which no
Receiver has been appointed and notwithstanding that an appointment under
the provisions of this Clause 13 (Appointment of Receiver) shall have
subsisted and been withdrawn in respect of that property or shall be
subsisting in respect of any other part of the Charged Property.
14. INDEMNITY
14.1 INDEMNITY
Without prejudice to any right at law given to trustees, the Chargor
further covenants with and undertakes to each of the Collateral Agent and
any Receiver or Receivers fully to indemnify and keep indemnified it from
and against all liabilities, losses, damages, costs and expenses (including
legal costs and expenses), charges, actions, proceedings, claims and
demands or any other obligation or liability (including, without
limitation, in respect of taxes, duties, levies, imposts and other charges
any indemnity and other amounts which the Collateral Agent is or would
become obliged to pay, upon payment by the Chargor, under such indemnity)
which it may properly incur (except, having regard to the provisions of any
Credit Document, insofar as they are incurred because of fraud, negligence,
wilful default or breach of trust on the part of it whether before or after
the Charge becomes enforceable):
(A) in consequence of anything done or purported to be done by the
Collateral Agent or any Receiver in relation to the Charged Property
or under this Deed or any Credit Document as a result of or in
connection with any failure by the Chargor to comply with its
obligations thereunder to the Collateral Agent or any Receiver; or
(B) in consequence of any payment in respect of the Secured Indebtedness
(whether made by the Chargor or a third party) being impeached or
declared void for any reason whatsoever; or
(C) in consequence of the breach or non-performance by the Chargor of any
of their respective warranties, representations, covenants or
undertakings herein contained or otherwise relating to all or any part
of the Charged Property; or
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(D) in connection with the realisation of the Charged Property (including
the costs of any proceedings in relation to this Deed or to the
Secured Indebtedness).
14.2 INTEREST
The amounts payable to the Collateral Agent or the Receiver under Clauses
14.1 (Indemnity) and 17 (Stamp Duty and Taxes) shall carry interest in
accordance with section 2.10 of the Facility Agreement from the date on
which they were paid or incurred by the Collateral Agent or the Receiver
(as the case may be) to the date of actual payment to the Collateral Agent
or, as the case may be, the Receiver under the aforementioned clauses as
well after as before any judgment and such amounts and interest may be
debited by the Collateral Agent to any account of the Chargor, but shall,
in any event (to the extent not fully paid or discharged), form part of the
Secured Indebtedness and accordingly be secured on the Charged Property
under the Charge.
15. POWER OF ATTORNEY
15.1 APPOINTMENT AND POWERS
The Chargor hereby irrevocably appoints the following (each an "ATTORNEY"
and collectively the "ATTORNEYS", and acting solely or jointly with the
other Attorneys), namely:
(A) the Collateral Agent;
(B) each and every person to whom the Collateral Agent shall from time to
time have duly delegated the exercise of the power of attorney
conferred by this Clause 15.1 (Appointment and Powers); and
(C) any Receiver appointed hereunder and for the time being holding
office,
to be its attorney or attorneys and in its name and otherwise on its behalf
and as its act and deed to sign, seal, execute, deliver, perfect and do all
deeds, instruments, acts and things which may be required (or which the
Collateral Agent, any person falling within Sub-clause (B) or any Receiver
appointed hereunder shall reasonably consider requisite) for carrying out
any obligation imposed on the Chargor, as the case may be, by or pursuant
to this Deed (including but not limited to the obligations of the Chargor
under Clauses 4 (Covenant to Deposit and Further Assurance) and 8
(Covenants and Undertakings), for carrying out any sale, lease or other
dealing by the Collateral Agent or any such Receiver into effect, for
conveying or transferring any legal estate or other interest in the Charged
Property, for getting in the Charged Property, and generally for enabling
the Collateral Agent or any person falling within Sub-clause (B) or any
Receiver to exercise the respective powers conferred on them by or pursuant
to this Deed or by law provided that the power contained in this Clause
15.1 (Appointment and Powers) shall not be exercisable unless and until the
Charge shall have become enforceable. The exercise of such power by the
Collateral Agent or any person falling within Sub-clause (B) or any
Receiver shall not put any person dealing with it upon any enquiry as to
whether an Event of Default shall have occurred. Each of the Collateral
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Agent, any person falling within Sub-clause (B) and any Receiver shall have
full power to delegate the power conferred on it by Clause 15.1
(Appointment and Powers), but no such delegation shall preclude the
subsequent exercise of such power by the Collateral Agent or any person
falling within Sub-clause (B) or any Receiver (as the case may be) itself
or preclude the Collateral Agent or any person falling within Sub-clause
(B) or any Receiver (as the case may be) from making a subsequent
delegation thereof to some other person; any such delegation may be revoked
by the Collateral Agent or any person falling within Sub-clause (B) or any
Receiver (as the case may be) at any time.
15.2 RATIFICATION
The Chargor shall ratify and confirm all transactions lawfully and properly
entered into by the Collateral Agent or any Receiver or delegate of the
Collateral Agent in the exercise of the Collateral Agent's or such
Receiver's respective powers and all transactions lawfully and properly
entered into, documents executed and things done by the Collateral Agent or
such Receiver or delegate by virtue of the power of attorney given by
Clause 15.1 (Appointment and Powers).
15.3 ACKNOWLEDGEMENT OF CONSIDERATION
The power of attorney hereby granted is as regards the Collateral Agent,
its delegates and any such Receiver (and as the Chargor hereby
acknowledges) granted irrevocably and severally, for value and for security
as part of the Charge to secure the several proprietary interests of and
the performance of obligations owed to the respective donees within the
meaning of the Powers of Attorney Ordinance.
16. SET-OFF AND CURRENCY
16.1 CURRENCY OF ACCOUNT
(A) Except where specifically provided otherwise, US dollars are the
currency of account and payment for each and every sum at any time due
to the Collateral Agent hereunder provided that each payment in
respect of costs and expenses shall be made in Hong Kong dollars if
incurred in Hong Kong dollars.
(B) If any sum due from the Chargor under this Deed or any order or
judgment given or made in relation hereto has to be converted from the
currency (the "FIRST CURRENCY") in which the same is payable hereunder
or under such order or judgment into another currency (the "SECOND
CURRENCY") for the purpose of (a) making or filing a claim or proof
against the Chargor, (b) obtaining an order or judgment in any court
or other tribunal or (c) enforcing any order or judgment given or made
in relation hereto then:
(i) the Chargor shall indemnify and hold harmless the Collateral
Agent from and against any loss suffered except to the extent
that such loss is suffered as a result of or in connection with
the Collateral Agent's own fraud, negligence, wilful default,
breach of duty or breach of trust; and
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(ii) the Collateral Agent shall account to the Chargor for the amount
by which any sum realised by it exceeds the aggregate amount of
all sums owing to it by the Chargor at the time at which such
profit is realised provided that the Collateral Agent shall only
be required to make any payment to the Chargor in relation
thereto if at such time all the payment obligations of the
Chargor hereunder to the Collateral Agent are satisfied,
in each case where such loss or excess arises as a result of any
discrepancy between (1) the rate of exchange used for such purpose to
convert the sum in question from the first currency into the second
currency and (2) the rate or rates of exchange at which the Collateral
Agent may in the ordinary course of business purchase the first
currency with the second currency upon receipt of a sum paid to it in
satisfaction, in whole or in part, of any such order, judgment, claim
or proof.
16.2 SET-OFF
The Chargor waives, and (where incapable of waiver) agrees not to exercise
(unless required to do so by law), any right of set-off or netting, whether
conferred by agreement or law, which it may have against the Collateral
Agent so that it does not reduce any amount payable by it to the Collateral
Agent under this Deed.
16.3 CURRENCY CONVERSION
For the purpose of the satisfaction of the Secured Indebtedness or for the
purpose of crediting any monies to the Account or any suspense account
pursuant to Clause 10.12 (Suspense Account(s)) or making any application
therefrom or for any other purpose in connection with this Deed, the
Collateral Agent may (unless otherwise required by law) convert any monies
received, recovered or realised or subject to application by the Collateral
Agent under this Deed or any monies to be credited to any such account
(including the proceeds of any previous conversion under this Clause 16
(Set-off and Currency)) from their existing currency of denomination into
such other currency of denomination as the Collateral Agent may reasonably
think fit and any such conversion shall be effected at such rate or rates
of exchange as may be agreed by the Collateral Agent in consultation with
the Chargor as being relevant and any rate, method and date so agreed shall
be binding on the Chargor and any costs, expenses or commissions incurred
in effecting any such conversion shall be deducted from the proceeds of any
such conversion.
17. STAMP DUTY AND TAXES
The Chargor shall pay all stamp duties and similar fees, filing and
registration fees and other transaction taxes required in relation to or
for the purpose of procuring the execution, validity and enforceability of
this Deed and the Charge and shall indemnify the Collateral Agent and each
Receiver appointed hereunder against any liabilities, costs, claims and
expenses resulting from any failure to pay or any delay in paying the same
on a full indemnity basis.
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18. AMENDMENTS
This Deed may not be amended, modified or waived in any respect whatsoever,
without the prior written consent of the Collateral Agent given with
express reference to this Clause 18 (Amendments) and expressly stated to be
intended to operate as the Collateral Agent's consent to such amendment,
modification or waiver on behalf of the Requisite Lenders.
19. APPLICATION TO COURT
The Collateral Agent may, at any time after the Charge has become
enforceable, apply to the court for an order that the terms of this Deed be
carried into execution under the direction of the Court and for the
appointment of a Receiver of the Charged Property or any part thereof and
for any other order in relation to the administration of the terms of this
Deed as the Collateral Agent shall deem fit and it may assent to or approve
any application to the Court made at the instance of the Collateral Agent
or on its behalf and the Collateral Agent shall be indemnified by the
Chargor against all costs, charges and expenses properly incurred by it in
relation to any such application or proceedings.
20. PARTIAL INVALIDITY
Every provision contained in this Deed shall be severable and distinct from
every other such provision and if at any time any provision hereof is or
becomes illegal, invalid or unenforceable in any respect under the law of
any jurisdiction, neither the legality, validity or enforceability of the
remaining provisions hereof nor the legality, validity or enforceability of
such provision under the law of any other jurisdiction shall in any way be
affected or impaired thereby.
21. NOTICES
21.1 COMMUNICATIONS IN WRITING
Each communication to be made hereunder shall be made in writing and,
unless otherwise stated, shall be made by facsimile or letter.
21.2 ADDRESSES
Any communication or document to be made or delivered by one person to
another pursuant to this Deed shall (unless that other person has by 15
days' written notice to the one specified another address department,
officer or person as the case may be) be made or delivered to that other
person at the address identified with its signature below and shall be
deemed to have been made or delivered (in the case of any communication
made by letter) when left at that address during normal business hours on a
Business Day (or on the next Business Day if not left during normal
business hours on a Business Day) or (as the case may be) 5 days (in the
case of local post) and 10 days (in the case of overseas post) after being
deposited in the post postage prepaid in an envelope addressed to it at
that address marked for the attention of any specified department, officer
or person or (in the case of any communication made by facsimile
26
transmission) when sent to the correct facsimile number of the addressee
identified with its signature below and received in whole and in legible
form by such addressee provided that any communication or document to be
made or delivered by the Chargor or the Collateral Agent shall be effective
only when received by the Chargor or the Collateral Agent, as appropriate,
and then only if the same is expressly marked for the attention of the
department, officer or person identified below with the signature of the
relevant addressee (or such other department, officer or person as the
relevant addressee shall from time to time and in each case by not less
than 3 days' prior notice in writing to the parties hereto have specified
for this purpose).
21.3 ENGLISH LANGUAGE
Each communication and document made or delivered by one party to another
pursuant to this Deed shall be in the English language or accompanied by a
translation thereof into English certified (by an officer of the person
making or delivering the same) as being a true and accurate translation
thereof.
22. ASSIGNMENT
The Collateral Agent may assign its rights and obligations under this Deed
to any successor under the Facility Agreement in accordance with section
9.7 of the Facility Agreement.
23. COSTS AND EXPENSES
The Chargor further covenants with and undertakes to the Collateral Agent
and any Receiver appointed by the Collateral Agent hereunder or by law
(including more than one such receiver and any substitute receiver) to
reimburse or pay to the Collateral Agent or such Receiver (on the basis of
full indemnity) the amount of all proper costs, charges, liabilities and
expenses including costs, charges or expenses incurred by the Collateral
Agent or such Receiver or any attorney, manager, agent or delegate in
connection with:
(A) the negotiation, preparation, registration, perfection, preservation
or enforcement of this Deed and any other document relating thereto;
and
(B) the proper exercise or the attempted proper exercise by or on behalf
of the Collateral Agent or such Receiver of any of the powers of the
Collateral Agent or such Receiver or any other action properly taken
by or on behalf of the Collateral Agent with a view to or in
connection with the enforcement of any obligations of the Chargor
under any of the Credit Documents or the recovery by the Collateral
Agent or any such Receiver from the Chargor of the Secured
Indebtedness then due and payable.
24. CERTIFICATES AND DETERMINATIONS
For all purposes, including any Proceedings (as defined in Clause 26.3
(Non-Exclusive Jurisdiction):
27
(a) a determination by the Collateral Agent; or
(b) a copy of a certificate signed by an officer of the Collateral Agent,
of the amount of any indebtedness comprised in the Secured Indebtedness for
the time being or at any time shall, in the absence of manifest error, be
conclusive evidence against the Chargor as to the amount thereof.
25. GOVERNING LAW
This Deed is governed by Hong Kong law.
26. JURISDICTION
26.1 HONG KONG COURTS
The courts of Hong Kong have non-exclusive jurisdiction to settle any
dispute (a "DISPUTE") arising out of or in connection with this Deed
(including a dispute regarding the existence, validity or termination of
this Deed or the consequences of its nullity).
26.2 CONVENIENT FORUM
The parties agree that the courts of Hong Kong are the most appropriate and
convenient courts to settle Disputes between them and, accordingly, that
they will not argue to the contrary.
26.3 NON-EXCLUSIVE JURISDICTION
This Clause 26 (Jurisdiction) is for the benefit of all parties hereto
other than the Chargor. As a result and notwithstanding Clause 26.1 (Hong
Kong Courts), it does not prevent any party hereto other than the Chargor
from taking proceedings relating to a Dispute ("PROCEEDINGS") in any other
courts with jurisdiction. To the extent allowed by law, the parties hereto
other than the Chargor may take concurrent Proceedings in any number of
jurisdictions.
26.4 AGENT FOR SERVICE
(A) The Chargor irrevocably appoints Huawei-3Com Co., Limited of Suites
3013-3014, 30/F One International Finance Centre, 0 Xxxxxxx Xxxx
Xxxxxx, Xxxxxxx, Xxxx Xxxx to be its agent for the receipt of Service
Documents. It agrees that any Service Document may be effectively
served on it in connection with Proceedings in Hong Kong by service on
its agent effected in any manner permitted by applicable law.
(B) If the agent at any time ceases for any reason to act as such, the
Chargor shall appoint a replacement agent having an address for
service in Hong Kong and shall notify the Collateral Agent of the name
and address of the replacement agent. Failing such appointment and
notification, the Collateral Agent shall be
28
entitled by notice to the Chargor to appoint a replacement agent to
act on behalf of the Chargor. The provisions of this clause applying
to service on an agent apply equally to service on a replacement
agent.
(C) "SERVICE DOCUMENT" means a claim form, application notice, order,
judgment or other document relating to any Proceedings.
27. EXECUTION AND COUNTERPARTS
This Deed may be executed in any number of counterparts and by different
parties hereto in separate counterparts, each of which when so executed
shall be deemed to be an original and all of which when taken together
shall constitute one and the same Deed.
IN WITNESS WHEREOF the parties hereto have caused this Deed to be duly executed
the day and year first above written.
29
SCHEDULE 1
PARTICULARS OF THE SHARES
CHARGOR NUMBER AND CLASS OF SHARES
------- --------------------------
3COM TECHNOLOGIES 9,705,000 ORDINARY SHARES
Shareholder of and the number and class of shares in Huawei-3Com Co., Limited
EXECUTION PAGES
THE CHARGOR
Executed as a Deed by ) SEAL AFFIXED
for and on behalf of )
3COM TECHNOLOGIES ) XXXX X. XXXXXXX
in the presence of: XXXXXXX X. HELD )
Address: XX Xxx 000 XX, Xxxxxx House, South Church Street, Xxxxxx Town, Grand
Cayman, Cayman Islands
Facsimile Number: ____________________________
Attention: ___________________________________
EXECUTION PAGES
THE COLLATERAL AGENT
Executed as a deed by affixing the common seal )
of INDUSTRIAL AND COMMERCIAL ) SEAL AFFIXED
BANK OF CHINA (ASIA) LIMITED )
in the presence of: )
XXXX XXXX XXX XXXXXXX
Director
XXXXX XXX XXXX XXXXX
Secretary
Address: 00xx Xxxxx, XXXX Xxxxx, 0 Xxxxxx Xxxx, Xxxxxxx, Xxxx Xxxx
Facsimile Number: 2869 8221
Attention: ____________________________
CONFORMED COPY
Dated 29 March 2007
3COM TECHNOLOGIES
as Chargor
INDUSTRIAL AND COMMERCIAL BANK OF CHINA (ASIA) LIMITED
as Collateral Agent
----------
H3C EQUITABLE SHARE CHARGE
----------
Xxxxxxxxx and May
00/X, Xxxxxxx Xxxxx
Xxx Xxxxxxxxx Xxxxx
Xxxxxxx, Xxxx Xxxx
(RMGG/AHLL)
HK070540109
CONTENTS
CLAUSE PAGE
------ ----
1. INTERPRETATION AND DEFINITIONS 1
2. COVENANT TO PAY AND NATURE OF SECURED INDEBTEDNESS 3
3. CHARGE 4
4. COVENANT TO DEPOSIT AND FURTHER ASSURANCES 4
5. REDEMPTION 6
6. THE SHARES 7
7. REPRESENTATIONS AND WARRANTIES 7
8. COVENANTS AND UNDERTAKINGS 8
9. DEFAULT PROCEDURE 10
10. EFFECTS OF THE CHARGE BECOMING ENFORCEABLE 10
11. PRESERVATION OF RIGHTS 14
12. PROTECTION OF PURCHASERS 18
13. APPOINTMENT OF RECEIVER 19
14. INDEMNITY 21
15. POWER OF ATTORNEY 22
16. SET-OFF AND CURRENCY 23
17. STAMP DUTY AND TAXES 24
18. AMENDMENTS 25
19. APPLICATION TO COURT 25
20. PARTIAL INVALIDITY 25
21. NOTICES 25
22. ASSIGNMENT 26
23. COSTS AND EXPENSES 26
24. CERTIFICATES AND DETERMINATIONS 26
25. GOVERNING LAW 27
26. JURISDICTION 27
27. EXECUTION AND COUNTERPARTS 28
SCHEDULE 1 29
Particulars of the Shares 29
