EXHIBIT 10.44
DATED November 6, 2003
SUPPLEMENTAL AGREEMENT
relating to a
(POUND)75,000,000 SYNDICATED CREDIT AGREEMENT
IDEAL HARDWARE LIMITED
XXXX MICROPRODUCTS EUROPE EXPORT LIMITED
as Original Borrowers
BM EUROPE PARTNERS X.X.
XXXX MICROPRODUCTS EUROPE BV
BANK OF AMERICA, NATIONAL ASSOCIATION
as Arranger, Issuer, Swingline Lender, Agent and Security Trustee
and
CERTAIN BANKS AND FINANCIAL INSTITUTIONS
as Lenders
XXXXXXXX
0 Xxxxxxxxxx Xxxxxx Xxxxxxx Xxxxxxx Xxxxxx XX0X 0XX DX 136546 Bishopsgate 2
TELEPHONE x00 (0)000 000 0000 FAX x00 (0)000 000 0000
OFFICES AND ASSOCIATED OFFICES Aosta Berlin Birmingham Brussels Hong Kong Leeds
London Madrid Manchester Milan Munich Paris Rome Turin
WEBSITE xxx.xxxxxxxx.xxx
REFERENCE DJC/XXX/AME.70-6
1 INTERPRETATION....................................................... 2
2 AMENDMENTS TO THE CREDIT AGREEMENT................................... 3
3 REPRESENTATIONS AND WARRANTIES....................................... 3
4 EXPENSES AND FEES.................................................... 4
5 CONFIRMATIONS........................................................ 5
6 EFFECTIVE DATE....................................................... 5
7 MISCELLANEOUS........................................................ 6
8 FINANCE DOCUMENT..................................................... 6
9 GOVERNING LAW AND JURISDICTION....................................... 6
SCHEDULE 1 RESTATED CREDIT AGREEMENT..................................... 7
SCHEDULE 2 FORM OF OBLIGOR'S CERTIFICATE................................. 8
SCHEDULE 3 FORM OF SUPPLEMENTAL DEED..................................... 10
1
THIS SUPPLEMENTAL AGREEMENT is dated 2004
PARTIES
(1) IDEAL HARDWARE LIMITED and XXXX MICROPRODUCTS EUROPE EXPORT LIMITED as
Original Borrowers;
(2) BM EUROPE PARTNERS C.V.;
(3) XXXX MICROPRODUCTS EUROPE B.V.;
(3) BANK OF AMERICA, NATIONAL ASSOCIATION as Arranger, Agent, Swingline
Lender, Issuer and Security Trustee; and
(4) THE BANKS AND FINANCIAL INSTITUTIONS named in schedule 1 to the Credit
Agreement referred to herein
WHEREAS:
(A) By a credit agreement (the "CREDIT AGREEMENT") dated 2 December 2002 and
made between the parties to this Supplemental Agreement the Lenders agreed
to make to the Borrowers a revolving credit facility of up to
(pound)75,000,000.
(B) The Borrower has requested the Lenders to amend the Credit Agreement to
the extent set out in this Supplemental Agreement.
NOW IT IS AGREED as follows:
1 INTERPRETATION
1.1 DEFINITIONS IN CREDIT AGREEMENT
Unless the context otherwise requires and save as mentioned below, words
and expressions defined in the Credit Agreement shall have the same
meanings when used in this Supplemental Agreement.
1.2 FURTHER DEFINITIONS:
In this Supplemental Agreement, unless the context otherwise requires:
"EFFECTIVE DATE" means the date on which the notice referred to in Clause
6.1 is given by the Agent;
"SUPPLEMENTAL AGREEMENT" means this supplemental agreement;
"SUPPLEMENTAL DEED" means the deed supplemental to the Debenture executed
or, as the case may be, to be executed in the form or substantially in the
form of Schedule 3 (Form of Supplemental Deed).
2
1.3 INTERPRETATION OF CREDIT AGREEMENT
References in the Credit Agreement to "THIS AGREEMENT" shall, with effect
from the Effective Date and unless the context otherwise requires, be
references to the Credit Agreement as amended by this Supplemental
Agreement and words such as "HEREIN", "HEREOF", "HEREUNDER", "HEREAFTER",
"HEREBY" and "HERETO", where they appear in the Credit Agreement, shall be
construed accordingly
1.4 INCORPORATION OF CERTAIN REFERENCES
Clauses 1.2 to 1.13 (inclusive) of the Credit Agreement shall be deemed to
be incorporated in this Supplemental Agreement in full, mutatis mutandis.
2 AMENDMENTS TO THE CREDIT AGREEMENT
The parties to this Agreement agree for themselves and for their
successors, transferees and assigns that, on and with effect from the
Effective Date, the Credit Agreement shall be amended and restated and
thereafter shall be read and construed for all purposes as set out in
Schedule 1 (Restated Credit Agreement).
3 REPRESENTATIONS AND WARRANTIES
3.1 Each Obligor represents and warrants (in respect of itself and each other
Obligor) to and for the benefit of each other party to this Supplemental
Agreement that:
(a) REPRESENTATIONS AND WARRANTIES IN CREDIT AGREEMENT
the representations and warranties set out in clauses 14.1 and 14.2
of the Credit Agreement are true and correct as if made at the date
of this Supplemental Agreement with reference to the facts and
circumstances existing at such date;
(b) CORPORATE POWER
it has power to execute, deliver and perform its obligations under
this Supplemental Agreement and, if applicable, the Supplemental
Deed; all necessary corporate, shareholder and other action has been
taken to authorise the execution, delivery and performance of the
same and this Supplemental Agreement constitutes, and the
Supplemental Deed when executed and delivered by it will constitute,
valid and legally binding obligations of such Obligor enforceable in
accordance with their respective terms;
(c) NO CONFLICT WITH OTHER OBLIGATIONS
the execution and delivery of, the performance of its obligations
under, and compliance with the provisions of this Supplemental
Agreement and, if applicable, the Supplemental Deed by such Obligor
will not (i) contravene any existing applicable law, statute, rule
or regulation or any judgment, decree or permit to which such
Obligor is subject, (ii) conflict with, or result in any breach of
any of the terms of, or constitute a default under, any agreement or
other instrument to which such Obligor is a party or is subject or
by which it or any of its property is bound, (iii) contravene or
conflict with any provision of such Obligor's Memorandum and
Articles of Association, Articles of Incorporation/Bye-laws/Statutes
or other constitutional documents;
3
(d) CONSENTS OBTAINED
every consent, authorisation, licence or approval of, or
registration with or declaration to, governmental or public bodies
or authorities or courts required by such Obligor to authorise, or
required by such Obligor in connection with, the execution,
delivery, validity, enforceability or admissibility in evidence of
this Supplemental Agreement or the Supplemental Deed or the
performance by such Obligor of its obligations under this
Supplemental Agreement and the Supplemental Deed has been obtained
or made and is in full force and effect and there has been no
default in the observance of the conditions or restrictions (if any)
imposed in, or in connection with, any of the same;
(e) NO FILINGS REQUIRED
save for registration of the Supplemental Deed with the Registrar of
Companies pursuant to section 395 Companies Xxx 0000, it is not
necessary to ensure the legality, validity, enforceability or
admissibility in evidence of this Supplemental Agreement or the
Supplemental Deed that it or any other instrument be notarised,
filed, recorded, registered or enrolled in any court, public office
or elsewhere in the jurisdiction in which such Obligor is
incorporated or has its principal place of business or that any
stamp, registration or similar tax or charge be paid in any such
jurisdiction on or in relation to this Supplemental Agreement or the
Supplemental Deed and this Supplemental Agreement and the
Supplemental Deed are in proper form for their enforcement in the
courts of such jurisdiction.
3.2 Repetition
The representations and warranties in Clause 3.1(a) to 3.1(e) inclusive
shall be deemed to be repeated by each Obligor on and as of each date on
which a Loan is requested or is to be made (or, as the case may be, a
Letter of Credit is issued or requested to be issued) as if made with
reference to the facts and circumstances existing on each such date.
4 EXPENSES AND FEES
4.1 Expenses
Ideal shall pay to the Agent on demand all expenses (including legal fees)
incurred by the Agent and the Arrangers in connection with the
negotiation, preparation and execution of this Supplemental Agreement and
the Supplemental Deed.
4.2 Amendment fee
As consideration for entering into this Supplemental Agreement Ideal shall
pay to the Agent for account of the Lenders a fee in the amount of
(pound)75,000. The Agent acknowledges receipt of payment of this fee.
4.3 Collateral Management fee
Without prejudice to the obligations of Ideal under clause 22.3 of the
Credit Agreement, Ideal shall pay to the Agent an increased monthly
instalment of the Collateral Management Fee in the amount of (pound)5,000
for each of August 2003 and September 2003. The Agent acknowledges receipt
of payment of these instalments.
4
5 CONFIRMATIONS
5.1 Confirmation by Unsecured Guarantors
Each Unsecured Guarantor confirms that its obligations under clause 13 of
the Credit Agreement shall remain in full force and effect in respect of
the Obligors' obligations under the Credit Agreement (as amended by this
Supplemental Agreement).
5.2 Confirmation by Lenders
Each Lender confirms, for all purposes of the Finance Documents, its
approval of the conversion of the following intra-group loans into an
equivalent amount (comprising nominal value and share premium) of fully
paid equity share capital, the Obligors warranting, by their execution of
this Supplemental Agreement, the accuracy of the information contained in
the table below:
LENDER BORROWER AMOUNT OF LOAN CONVERTED
---------------------- --------------- ------------------------
Xxxx Microproducts Inc. BMEP (euro)20,006,912
Xxxx Microproducts Inc. BMEBV (euro)11,322,587
Xxxx Microproducts Inc. Ideal (pound)13,847,519
BMEP Ideal (pound)6,509,116
BMEBV Ideal (pound)1,852,862
6 EFFECTIVE DATE
6.1 Conditions precedent documentation
The amendments to be made to the Credit Agreement by this Supplemental
Agreement shall, without prejudice to Clause 6.3, take effect on and from
the date (the "EFFECTIVE DATE") on which the Agent gives notice to Ideal
and the Lenders that the Agent has received the following in form and
substance satisfactory to it:
(a) a certificate dated the date of this Supplemental Agreement in the
form appearing in Schedule 2 (Form of Obligor's Certificate) with
all its attachments and the enclosures;
(b) the Ideal Pro-Forma Balance Sheet, certified as being true and
accurate by the finance director of Ideal;
(c) the Supplemental Deed duly executed by each Charging Company,
together with a Form M395 in respect of each Charging Company duly
completed with the relevant details of the Supplemental Deed.
6.2 FURTHER CONDITIONS
The Agent shall not give notice of the occurrence of the Effective Date
under Clause 6.1 (unless expressly instructed in writing by the Majority
Lenders to do so) if, on the date on
5
which it would otherwise have done so, the Agent has received actual
knowledge that an Event of Default has occurred and is continuing or that
any of the representations and warranties in Clause 3.1 are untrue or
incorrect in any material respect as at such date as if made on such date
with respect to the facts and circumstances existing at such date.
7 MISCELLANEOUS
7.1 CONTINUATION OF CREDIT AGREEMENT
Save as amended by this Supplemental Agreement, the provisions of the
Credit Agreement shall continue in full force and effect and the Credit
Agreement and this Supplemental Agreement shall be read and construed as
one instrument.
7.2 COUNTERPARTS
This Supplemental Agreement may be executed in any number of counterparts
and by the different parties on separate counterparts, each of which when
so executed and delivered shall be an original but all counterparts shall
together constitute one and the same instrument.
8 FINANCE DOCUMENT
This Supplemental Agreement is a Finance Document.
9 GOVERNING LAW AND JURISDICTION
This Supplemental Agreement shall be governed by English law. The
provisions of clause 35.2 of the Credit Agreement shall be deemed to be
incorporated in this Supplemental Agreement as if set out in full, mutatis
mutandis, in this Clause 9.
IN WITNESS whereof the parties hereto have caused this Supplemental Agreement to
be duly executed the day and year first above written.
6
SCHEDULE 1
RESTATED CREDIT AGREEMENT
7
DATED 2002
-------------------------
IDEAL HARDWARE LIMITED
XXXX MICROPRODUCTS EUROPE EXPORT LIMITED
AS ORIGINAL BORROWERS
AND
BM EUROPE PARTNERS X.X.
XXXX MICROPRODUCTS EUROPE BV
BANK OF AMERICA, NATIONAL ASSOCIATION
AS ARRANGER, ISSUER, SWINGLINE LENDER, AGENT AND SECURITY TRUSTEE
AND
CERTAIN BANKS AND FINANCIAL INSTITUTIONS
AS LENDERS
---------------------------------------------------------
(POUND)75,000,000
SYNDICATED CREDIT AGREEMENT
---------------------------------------------------------
CONTENTS
CLAUSE PAGE
1 INTERPRETATION ................................................ 2
2 THE REVOLVING FACILITY ........................................ 27
3 ADDITIONAL BORROWERS AND UNSECURED GUARANTORS ................. 29
4 ADDITIONAL CHARGING COMPANIES ................................. 30
5 CONDITIONS PRECEDENT .......................................... 31
6 UTILISATION OF THE REVOLVING FACILITY ......................... 31
7 INTEREST AND INTEREST PERIODS ................................. 40
8 MARKET DISRUPTION ............................................. 43
9 REPAYMENT, PREPAYMENT AND CANCELLATION ........................ 44
10 TAXES ......................................................... 46
11 INCREASED COSTS ............................................... 48
12 ILLEGALITY .................................................... 50
13 GUARANTEE ..................................................... 50
14 REPRESENTATIONS AND WARRANTIES ................................ 54
15 FINANCIAL CONDITION ........................................... 59
16 COVENANTS ..................................................... 63
17 DEFAULT ....................................................... 79
18 DEFAULT INTEREST .............................................. 83
19 INDEMNITIES AND CURRENCY OF ACCOUNT ........................... 84
20 PAYMENTS ...................................................... 86
21 SET-OFF ....................................................... 89
22 FEES .......................................................... 90
23 PRO RATA SHARING .............................................. 92
24 COSTS, EXPENSES AND STAMP DUTIES .............................. 93
25 CALCULATIONS AND EVIDENCE OF DEBT ............................. 94
26 THE AGENT, THE ARRANGER, THE SECURITY TRUSTEE AND THE LENDERS . 96
27 TRUSTEE PROVISIONS ............................................ 101
28 ASSIGNMENTS AND TRANSFERS ..................................... 106
29 TERM AND TERMINATION .......................................... 109
30 AMENDMENTS, WAIVERS AND REMEDIES .............................. 110
31 PARTIAL INVALIDITY ............................................ 111
32 NOTICES ....................................................... 111
33 COUNTERPARTS .................................................. 113
34 DUTCH PARALLEL DEBT ........................................... 113
35 LAW AND JURISDICTION .......................................... 113
SCHEDULE
1 LENDERS AND COMMITMENTS ....................................... 115
2 CONDITIONS PRECEDENT .......................................... 116
3 FORM OF OBLIGOR'S CERTIFICATE ................................. 118
4 FORM OF UTILISATION NOTICE .................................... 120
5 MANDATORY COST FORMULAE ....................................... 122
6 FORM OF TRANSFER CERTIFICATE .................................. 125
7 THE DORMANT COMPANIES THE CHARGING COMPANIES AND THE BABY BELLS 128
8 FORM OF ACCESSION NOTICE ...................................... 130
9 DOCUMENTS TO ACCOMPANY ACCESSION NOTICE OR SUPPLEMENTAL DEED .. 131
10 THE MATERIAL CONTRACTS ........................................ 133
THIS AGREEMENT is made on 2002
BETWEEN:
(1) IDEAL HARDWARE LIMITED a company incorporated in England and Wales with
registered number 03969946 whose registered office is at Xxxxxxxx Xxxxx,
Xxx Xxxx, Xxxxxxxxxxx, Xxxxxx XX0 0XX ("IDEAL") and XXXX MICROPRODUCTS
EUROPE EXPORT LIMITED a company incorporated in England and Wales with
registered number 03711148 whose registered office is at Xxxxxxxx Xxxxx,
Xxx Xxxx, Xxxxxxxxxxx, Xxxxxx XX0 0XX ("BMEE") (each an "ORIGINAL
BORROWER" and together, the "ORIGINAL BORROWERS");
(2) BM EUROPE PARTNERS C.V. a limited partnership (commanditaire vennootschap)
established under the laws of the Netherlands, having its official seat in
Almere, the Netherlands and its registered office at Xxxxxxxxxx 00-00,
0000 XX Xxxxxx, xxx Xxxxxxxxxxx and registered in the Commercial Register
under number 04065637 ("BMEP");
(3) XXXX MICROPRODUCTS EUROPE B.V. a private company with limited liability
(besloten vennootschap met beperkte aansprakelijkheid) incorporated under
the laws of the Netherlands, having its official seat in Emmen, the
Netherlands and its registered office at Xxxxxxxxxx 00-00, 0000 XX Xxxxxx,
xxx Xxxxxxxxxxx and registered in the Commercial Register under number
04064633 ("BMEBV");
(4) BANK OF AMERICA, NATIONAL ASSOCIATION acting through its London branch at
0 Xxxx Xxxxxx, Xxxxxx X0 0XX in its capacity as arranger (the "ARRANGER"),
in its capacity as agent for the Lenders (the "AGENT"), in its capacity as
the Lender making Swingline Loans (the "SWINGLINE LENDER"), in its
capacity as the Lender issuing any Letter of Credit or Guarantee (the
"ISSUER") and in its capacity as security trustee under the Security
Documents (the "SECURITY Trustee"); and
(5) THE BANKS AND FINANCIAL INSTITUTIONS named in Schedule 1 (the "ORIGINAL
LENDERS").
IT IS AGREED as follows:
1 INTERPRETATION
1.1 DEFINITIONS
Save as otherwise provided in this Agreement, the following words and
phrases have the following meanings throughout this Agreement:
ACCOUNT: in relation to each Trading Company, its right to payment for a
sale or lease and delivery of goods or rendering of services;
ACCOUNT DEBTOR: each person having any obligation on or in connection with
an Account;
ACCESSION NOTICE: a notice substantially in the form set out in Schedule
8;
2
ADDITIONAL BORROWER: a Group Company which has acceded to this Agreement
as an Additional Borrower by executing and delivering to the Agent an
Accession Notice in accordance with clause 3;
ADDITIONAL COST RATE: has the meaning given to it in paragraph 2 of
Schedule 5;
ADDITIONAL MONITORING AND ADMINISTRATION FEE: the meaning given to it in
clause 22.7;
ADJUSTED TANGIBLE ASSETS: the meaning given to it in clause 15.4;
ADJUSTED TANGIBLE NET WORTH: the meaning given to it in clause 15.4;
AFFILIATE:
(i) a person which, directly or indirectly, controls or is controlled by
or is under common control with, a Borrower;
(ii) a person which beneficially owns or holds, directly or indirectly,
5% or more of any class of voting shares of a Borrower; or
(iii) a person in which 5% of any class of voting shares is beneficially
owned or held, directly or indirectly, by a Borrower;
AGENT LOAN: the meaning given to it in clause 6.15.1;
AGENT'S SPOT RATE OF EXCHANGE: the Agent's spot rate of exchange for the
purchase of the relevant currency with sterling in the London foreign
exchange market at or about 11.00 am on a particular day;
ANNIVERSARY DATE: each anniversary of the Closing Date;
APPLICABLE GAAP:
(i) save as provided in paragraph (ii) of this definition, in respect of
any person, the generally accepted accounting principles and
policies in the country in which such person is incorporated or
under whose laws it is otherwise established, consistently applied;
and
(ii) in connection with the preparation of the Pro-Forma Balance Sheet
and the Management Accounts and for the purposes of determining
compliance by BMEP with the financial ratio set out in clause 15.4,
generally accepted accounting principles and policies in the United
States of America, consistently applied ("US GAAP");
3
APPLICABLE MARGIN:
(i) with effect from the Effective Date, two and one half of one per
cent. (2.50%) per annum; and
(ii) thereafter, such lower figure (if any) as may be determined by the
Agent pursuant to clause 7.6;
APPROVED ACQUISITION CONDITIONS: each of the following conditions:
(i) that the relevant acquisition (the "RELEVANT ACQUISITION") is to be
funded by the relevant Group Company (a "PURCHASER") entirely out of
Excess Availability and that at the time of the relevant
acquisition, the amount of Excess Availability was not less than
(pound)5,000,000 and the projections, forecasts and other
information supplied to the Agent pursuant to clause 15.2
demonstrate that an average Excess Availability of not less than
(pound)5,000,000 will be maintained for a continuous period of three
(3) months commencing on the date of completion of the relevant
acquisition;
(ii) that the costs of the relevant acquisition do not exceed
(pound)5,000,000 (or the equivalent in any other currency) and when
aggregated with the costs of all other Pre-Approved Acquisitions
made or in the process of being made by that or any other purchaser
do not or, as the case may be, will not, exceed (pound)10,000,000
(or the equivalent in any other currency) during the term of this
Agreement;
(iii) that the relevant purchaser (or Ideal on its behalf) has given
written notice to the Agent (such notice to be served not less than
15 business days prior to the proposed date of completion of the
relevant acquisition), such notice to include, without limitation,
(A) the name of the company and/or a brief description of the assets
being purchased and/or the nature of such company's business; (B) a
breakdown of the total consideration payable (including any element
of deferred consideration and/or the details of any earn-out or
possible additional consideration payable); (C) the business case or
other reason(s) underlying the relevant acquisition; (D) the basic
terms and conditions of the relevant acquisition; (E) a brief
business plan and a historic financial statement in relation to any
company being purchased (to include a profit and loss account,
balance sheet and cash flow statement relating to the immediately
preceding 12 months);
(iv) in the case of any relevant acquisition of shares in a company, such
acquisition has been approved or recommended by the board of
directors of such company;
(v) that the finance director of Ideal has delivered a certificate to
the Agent (together with such additional information or evidence as
the Agent may have reasonably required) confirming, among other
matters, (A) that no Default has occurred and is continuing or will
occur as a result of the completion of the relevant acquisition or
would have occurred if the relevant acquisition had been completed
on the last day of the
4
Financial Quarter most recently ended; (B) the level of current
creditors' days outstanding together with confirmation that the
largest twenty (20) trade creditors of the Group are being paid in
accordance with the credit terms prevailing between such parties;
and (C) that each of the foregoing conditions set out in paragraphs
(i) to (iv) (inclusive) has been satisfied and will continue to be
complied with as at each relevant date prescribed in this definition
of "APPROVED ACQUISITION CONDITIONS".
For the purpose of this definition of "APPROVED ACQUISITION CONDITIONS",
the expression "COSTS" shall be construed to mean the total initial,
deferred or additional consideration paid or payable to any person(s) in
connection with any relevant acquisition, together with all reasonable
costs, fees and expenses (including legal or other professional advisers'
fees) properly paid or payable in connection with the relevant
acquisition;
APPROVED ACQUISITION DOCUMENTS: any (i) sale agreement, (ii) share
exchange agreement, (iii) offering circular or (iv) any other documents or
instruments (howsoever described) relating to a Pre-Approved Acquisition
or any other acquisition of assets approved by the Agent;
AUDIT FEE: the meaning given to it in clause 22.4;
AUDITORS: PricewaterhouseCoopers, chartered accountants, or any other firm
of chartered accountants of similar standing selected by Ideal and
satisfactory to the Agent;
AVAILABLE COMMITMENT: in relation to a Lender at any time, the Commitment
of that Lender less the sum at such time of the Original Sterling Amount
of (i) the aggregate amount which it has advanced and (ii) (in the case of
the Issuer) the aggregate of its contingent liabilities under any Letters
of Credit or Guarantees issued by it;
AVAILABLE FACILITY: at any time, the aggregate of the Available
Commitments;
AVAILABLE REVOLVING FACILITY AMOUNT: at any time, in relation to the
Revolving Facility and any proposed Utilisation thereof by any Borrower,
the Revolving Facility Amount as reduced by the sum at such time of the
Original Sterling Amount of:
(i) the aggregate principal amount of all Revolving Loans and Swingline
Loans then outstanding;
(ii) the aggregate face amount of all Letters of Credit and of the
aggregate maximum contingent liability under all Guarantees issued
by the Issuer;
(iii) the amount by which the Commitment of any Bank is or is due to be
permanently cancelled or reduced in accordance with the terms of
this Agreement;
(iv) all reserves for accrued interest on the Revolving Loans and
Swingline Loans;
5
(v) all other reserves which the Agent in its discretion deems necessary
or desirable to maintain with respect to any Borrower's account
(including, without limitation, in respect of any day-to-day
fluctuations in the value of sterling against any Foreign Currency
and in respect of any liability of any Borrower under any Hedging
Agreement or in respect of any cash management or foreign exchange
services) and any amounts which the Agent, the Security Trustee, any
Lender or any other Beneficiary may be obliged to pay in the future
for the account of any Borrower;
BABY BELLS: each of the companies listed in Part 3 of Schedule 7 and "BABY
XXXX" means any one of them;
BENEFICIARY: each of the Agent, the Arranger, any Hedge Provider (provided
always that such Hedge Provider is the Arranger), the Swingline Lender,
the Issuer, the Security Trustee and any Lender;
BORROWERS: each Original Borrower and each Additional Borrower and
"BORROWER" means any one of them;
BORROWING BASE CERTIFICATE: a certificate in such form as the Agent may
from time to time reasonably require and completed by Ideal setting out,
amongst other things, details of Accounts and with effect from the
Inventory Eligibility Date, if applicable, Inventory (as specified in
clause 16.4.1) and of preferential creditors so as to enable the Agent to
determine the Available Revolving Facility Amount;
BORROWINGS: a sum equal to the aggregate amount for the time being of the
principal, capital or nominal amount (determined on a consolidated basis)
of all financial indebtedness of any member of the Group (other than
monies borrowed or raised from another member of the Group) and, without
prejudice to the generality of the foregoing, shall be deemed to include
the following:
(a) the principal amount of any debenture, bond, note, loan stock,
preference share capital, commercial paper or similar instrument of
any member of the Group;
(b) any amounts raised by any member of the Group under any xxxx of
exchange (but excluding any xxxx drawn or accepted in the ordinary
course of trade of the relevant member of the Group and which is
payable at sight or not more than 90 days after sight or has a final
maturity of not more than 90 days from the date thereof and is not
refinancing another xxxx whether or not relating to the same
underlying transaction) and the indebtedness of any member of the
Group under any acceptance credit, xxxx discounting, note purchase
or documentary credit facility;
(c) the aggregate amount remaining to be paid by any member of the Group
under any credit agreement save for amounts remaining to be paid
which cannot properly be attributed to capital in accordance with
Applicable GAAP;
6
(d) the capitalised value (determined in accordance with Applicable
GAAP) of the outstanding commitments of any member of the Group
under any finance lease;
(e) indebtedness under any receivables purchase, factoring or
discounting arrangement (to the extent there is any recourse against
any member of the Group);
(f) the aggregate amount remaining to be paid in respect of any credit
(other than normal trade credit which has been outstanding for a
period of less than 90 days) granted to, or of any deferred payments
due from, any member of the Group in respect of the acquisition or
construction price of assets acquired or constructed or the purchase
price of services supplied;
(g) indebtedness of any member of the Group in respect of any other
transaction having the commercial effect of a borrowing or other
raising of money entered into by it in order to finance its business
or operations or capital requirements; and
(h) (without double counting) indebtedness of any member of the Group
under any guarantee or other assurance against financial loss in
respect of the financial indebtedness of any person.
For the purpose of determining the amount of "BORROWINGS" at any time, any
amount which is on a particular day outstanding or repayable in a currency
other than sterling shall on that day be taken into account (i) if that
day is the last day of a Financial Year or Management Accounting Period,
at its equivalent in sterling at the rate of exchange used for the purpose
of preparing the balance sheet forming part of the Relevant Accounting
Information prepared as at such date and (ii) in any other case, at its
sterling equivalent as determined by the Agent by reference to the Agent's
Spot Rate of Exchange;
BORROWING COSTS: in relation to any financial period, a sum equal to the
aggregate amount of all continuing, regular or periodic costs (excluding
any prepayment or termination fee), charges and expenses incurred by the
Group in respect of such period (and whether paid or not) in effecting,
servicing or maintaining Borrowings including (but without
double-counting):
(a) interest (whether the same shall be payable immediately or be
capitalised or otherwise deferred);
(b) any fixed or minimum premium or dividend paid or payable on the
maturity of any Borrowings;
(c) consideration given whether by way of discount or otherwise in
connection with finance by way of acceptance credit, xxxx
discounting, note purchase, receivables purchase, debt factoring or
other like arrangement; and
(d) the gross amount payable under any finance lease or credit agreement
less so much as can properly be attributed to capital,
7
the amount of any such costs, charges and expenses to be allocated
to each such period over the term of any Borrowings in accordance
with Applicable GAAP;
CAPITAL EXPENDITURE: all payments due (whether or not paid) in
respect of the cost of any fixed asset or any improvement,
replacement, substitution or addition thereto, which has a useful
life of more than one year, including, without limitation, those
arising in connection with the direct or indirect acquisition of
such assets by way of increased product or service charges or offset
items or in connection with finance leases;
CAPITAL MARKETS TRANSACTION: any direct or indirect public offering
or private placement of any debt or equity securities of (including
any capital contribution to) any Borrower, BMEP or BMEBV;
CHARGING COMPANY: the companies listed in Part 2 of Schedule 7 and
any other Group Company which has executed the Debenture or which
has acceded to the Debenture by executing a Supplemental Deed in
accordance with clause 4;
"CASH OUTFLOW" means, in relation to any financial period and
without double-counting, the aggregate for that period of:
(i) Borrowing Costs;
(ii) taxes paid;
(iii) dividends paid or other distributions made;
(iv) Capital Expenditure;
(v) amortisation payments on Borrowings and the capital element of
any rental payments or instalments under any credit agreement or
finance lease;
(vi) any expenditure which results in a corresponding release of any
provision in the balance sheet;
CHESSINGTON MORTGAGEE: as at the Effective Date, National
Westminster Bank Plc as lender to Xxxx Microproducts Limited and as
mortgagee of the Chessington Property in connection with such
borrowings or such other bank or financial institution which may at
any time refinance all or any part of such borrowings, provided that
such bank or financial institution shall have entered into an
intercreditor deed or other priority arrangement on terms and
conditions mutually acceptable to such bank or financial
institution, Xxxx Microproducts Limited and the Agent;
CHESSINGTON PROPERTY: all that freehold property registered under
title number SGL 638201 and more particularly known as land and
buildings at Xxxxxxxx Xxxxx, Xxx Xxxx, Xxxxxxxxxxx, Xxxxxx XX0 0XX;
CLOSING DATE: 2 December 2002;
COLLATERAL: the meaning given to it in the Debenture;
8
COLLATERAL MANAGEMENT FEE: the meaning given to it in clause 22.3;
COMMITMENT: in relation to a Lender at any time, the amount in
sterling set opposite its name in Schedule 1 (and/or, as the case
may be, the amount in sterling specified as the portion transferred
in the Transfer Certificate pursuant to which such Lender increased
its Commitment or became a party to this Agreement) as the same may
at any time be cancelled or reduced in accordance with this
Agreement;
COMMITMENT PERIOD: the period commencing on the Closing Date and
ending on the date falling one month prior to the Termination Date;
DEBENTURE: the composite guarantee and debenture creating one or
more encumbrances in favour of the Security Trustee on behalf of the
Beneficiaries, in form and substance satisfactory to the Agent, to
be executed as a deed by each Charging Company to secure the
obligations of the Obligors under the Finance Documents;
DEFAULT: an Event of Default or any condition, act or event which
(with the giving of notice, lapse of time, making of any
determination, fulfilment of any condition or any combination of any
of the foregoing) may become an Event of Default;
DISCHARGE: a release, spill, emission, leaking, pumping, injection,
deposit, disposal, discharge, dispersal, leaching or migration of a
Hazardous Substance into the indoor or outdoor environment or into
or out of any real estate or other property, including the movement
of Hazardous Substances through or in the air, soil, surface water,
groundwater or real estate or other property;
DISTRIBUTION: any dividend or other distribution (whether in cash or
in kind) in respect of share capital, including any bonus issue or
return of capital (whether at a premium or otherwise);
DORMANT COMPANY: a company which is a "DORMANT" company as defined
in section 249AA Companies Xxx 0000 and which does not at any time
have assets (other than intercompany indebtedness) in excess of
(pound)5,000 (or the equivalent in any other currency) and which
expression shall include, for the purposes of this Agreement, each
of the companies whose names are set out in Part 1 of Schedule 7;
EBITDA: in relation to any financial period, a sum equal to the
IHL's Group's profit on ordinary activities before taxation (save to
the extent that such profit is attributable to any interest
received) after adding back Borrowing Costs, depreciation and
amortisation and deducting any release to profits of negative
goodwill in respect of such period but excluding:
(a) profits or losses on the sale or termination of an operation;
(b) profits or losses on the disposal of fixed assets; and
(c) extraordinary items;
9
EC INSOLVENCY REGULATION: Council Regulation (EC) No. 11346/2000 of
29 May 2000 on insolvency proceedings;
EFFECTIVE DATE: means the date on which the notice referred to in
Clause 6.1 of the Supplemental Agreement is given to the Agent;
ELIGIBLE ACCOUNTS: the Accounts of a Borrower which the Agent in the
exercise of its commercial discretion determines to be Eligible
Accounts. Without limiting the discretion of the Agent to establish
other criteria of ineligibility, Eligible Accounts shall not, unless
the Agent in its commercial discretion elects, include any Account:
(a) with respect to which more than ninety (90) days have elapsed
since the date of the original invoice or sixty (60) days have
elapsed since the due date therefor;
(b) with respect to which any of the representations, warranties,
covenants and agreements contained in the Debenture are
incorrect or have been breached;
(c) with respect to which Account (or any other Account due from
the applicable Account Debtor), in whole or in part, a cheque,
promissory note, draft, trade acceptance or other instrument
for the payment of money has been received, presented for
payment, and returned uncollected for any reason;
(d) which represents a progress billing (as hereinafter defined)
or as to which the applicable Borrower has extended the time
for payment without the consent of the Agent (for the purposes
hereof, "PROGRESS BILLING" means any invoice for goods sold or
leased or services rendered under a contract or agreement
pursuant to which the Account Debtor's obligation to pay such
invoice is conditional upon such Borrower's completion of any
further performance under such contract or agreement);
(e) with respect to which any one or more of the following events
has occurred to the Account Debtor on such Account: (i) death
or judicial declaration of incompetency of such Account Debtor
who is a natural person; (ii) the filing by or against such
Account Debtor of a request or petition for winding-up,
dissolution, liquidation or bankruptcy of such person or for
the appointment of an administrative receiver, receiver,
manager or administrator in respect of such person or its
assets or any other bankruptcy, insolvency or similar laws of
the United Kingdom or any foreign jurisdiction now or
hereafter in effect; (iii) the making of any general
assignment by such Account Debtor for the benefit of its
creditors; (iv) the appointment of a receiver or trustee of
such Account Debtor or of any of the assets of the Account
Debtor; (v) the institution by or against such Account Debtor
of any other type of insolvency proceeding or of any formal or
informal proceeding for the dissolution or liquidation of,
settlement of claims against, or winding up of affairs of,
such Account Debtor; (vi) the non-
10
payment generally of such Account Debtor of its debts as they
become due; or (vii) the cessation of the business of such
Account Debtor as a going concern;
(f) if fifty per cent. (50%) or more of the aggregate sterling
equivalent of outstanding Accounts owed at such time by the
Account Debtor thereon is classified as ineligible pursuant to
the other provisions of this definition;
(g) owed by an Account Debtor which (i) does not maintain its
registered office or principal place of business in the United
States, Canada (other than the Province of Newfoundland), the
United Kingdom or another country within the European Union,
(ii) is not organised under the laws of the United States,
Canada, part of the United Kingdom or another country within
the European Union or any political subdivision, state or
province thereof, or (iii) is the government of any foreign
country or sovereign state, or of any state, province
municipality or other political subdivision thereof, or of any
department, agency, public corporation, or other
instrumentality thereof, except to the extent that such
Account is secured or payable by a letter of credit
satisfactory to the Agent in its discretion;
(h) owed by an Account Debtor which is an Affiliate or employee of
such Borrower or an Account which the Agent determines is an
Intercompany Account or an internal account;
(i) with respect to Accounts of a Borrower, with respect to which
either the perfection, enforceability or validity of the
security over such Account constituted by the Debenture, or
the Security Trustee's or the Agent's right or ability to
obtain direct payment to the Agent or, as appropriate, the
Security Trustee, of the proceeds of such Account, is governed
by any laws other than the local state or federal laws of the
United States of America (including the UCC) or the laws of
Canada, any part of the United Kingdom or another member of
the European Union;
(j) owed by an Account Debtor to which a Borrower or any Affiliate
thereof is indebted in any way, or which is subject to any
right of set-off or recoupment by the Account Debtor (or
otherwise a contra account), unless the Account Debtor has
entered into an agreement acceptable to the Agent to waive
set-off rights, or if the Account Debtor thereon has disputed
liability or made any claim with respect to any other Account
due from such Account Debtor;
(k) duplicates subclause (g)(iii) above;
(l) which represents a sale on a xxxx-and-hold, guaranteed sale,
sale and return, sale on approval, consignment or other
repurchase or return basis;
11
(m) which is evidenced by a promissory note or other similar
instrument;
(n) with respect to which the Agent believes, in the exercise of
its commercial judgment, that the prospect of collection of
such Account is impaired or that such Account may not be paid
by reason of the Account Debtor's financial inability to pay;
(o) which arises out of a sale not made in the ordinary course of
such Borrower's business;
(p) with respect to which the goods giving rise to such Account
have not been shipped and delivered to and accepted by, or
have been rejected or objected to by, the Account Debtor or
the services giving rise to such Account have not been fully
performed by such Borrower, and, if applicable, accepted by
the Account Debtor, or the Account Debtor revokes its
acceptance of such goods or services;
(q) owed by an Account Debtor or group of affiliated Account
Debtors which is obligated to the Borrowers, or any of them,
representing Accounts the aggregate unpaid balance of which
exceeds ten per cent. (10%) of the aggregate unpaid balance of
all Accounts owed to the Borrowers at such time by all of the
Borrowers' Account Debtors;
(r) which is not subject to a first priority, perfected Security
Interest in favour of the Security Trustee, for the benefit of
the Beneficiaries established in a manner satisfactory to the
Agent;
(s) owed by an Account Debtor incorporated outside the United
Kingdom with whom such Borrower is trading in excess of its
agreed credit limits;
(t) with respect to which such Borrower or the Agent has deemed
such Account as uncollectible or has any reason to believe
that such Account is uncollectible; and
(u) which the Agent determines, in its commercial discretion, is
ineligible for any other reason.
The Agent will consider a request from Ideal for the inclusion of
Accounts in excess of ten per cent. (10%) of the total Eligible
Accounts (as described in paragraph (q)) on a case by case basis,
upon production by Ideal of such financial or other information
regarding the business condition (financial or otherwise) of the
Borrowers and the Group as the Agent may require and upon Ideal
demonstrating to the satisfaction of the Agent, an improvement in
its trading and financial position since the Effective Date.
If any Account at any time ceases to be an Eligible Account, then
such Account shall promptly be excluded from the calculation of the
Maximum Eligibility Amount and the Revolving Facility Amount;
12
ELIGIBLE INVENTORY: with effect from the Inventory Eligibility Date,
if any, Inventory valued at the lower of cost (on a FIFO basis) or
market value, which is eligible as the basis for Revolving Loans,
based on such criteria as the Agent may from time to time establish
in its reasonable commercial discretion;
ENVIRONMENTAL AUTHORISATION: any authorisation, permit, licence,
consent, registration or other approval required by or pursuant to
any Environmental Law;
ENVIRONMENTAL LAWS: all applicable laws, regulations, codes of
practice, circulars, statutory guides, guidance notes and the like
(whether in the United Kingdom or in any other jurisdiction in which
any Obligor carries on its business or in which its assets may be
situated) relating to contamination, human health, safety or the
environment including but not limited to those relating to
Discharges, waste, nuisance, health and safety, noise, packaging or
the manufacture, processing, use, handling, treatment, storage,
labelling, recovery, recycling, transport or disposal of Hazardous
Substances;
EQUIPMENT: in relation to each Trading Company, all of its now owned
and hereafter acquired machinery, equipment, furniture, furnishings,
fixtures and other tangible personal property of any kind (except
Inventory), as well as all of such types of property leased by it
and all of its rights and interest with respect thereto under such
leases together with all present and future additions and accessions
thereto and replacements therefor, component and auxiliary parts and
supplies used or to be used in connection therewith and all
substitutes for any of the foregoing, and all manuals, drawings,
instructions, warranties and rights with respect thereto, wherever
any of the foregoing is located;
EVENT OF DEFAULT: any of those events specified in clause 17.1;
EXCESS AVAILABILITY: at any time, the amount, if any, by which the
Revolving Facility Amount exceeds the Total Outstandings at such
time;
FACILITY OFFICE: in relation to a Lender at any time, the office set
out under its name at the end of this Agreement or, in the case of a
Transferee, in the Transfer Certificate to which it is a party as
Transferee or, in the case of a Lender which is an assignee or other
successor of any other Lender, the office notified to the Agent by
the assignee or other successor on or before the date it becomes a
Lender or such other office as such Lender may from time to time
notify to the Agent;
FEE LETTER: means any letter or letters dated on or about the date
of this Agreement and/or the Effective Date between the Arranger and
Ideal (or the Agent and Ideal) setting out any of the fees referred
to in clause 22;
FINANCE DOCUMENTS: this Agreement, any Fee Letter, any Accession
Notice, any Hedging Agreement, the Security Documents and any other
agreement, deed, notice, document or certificate designated as such
by the Agent and Ideal;
13
FINANCIAL QUARTER: any period of three months in any Financial Year,
ending on the day which is, respectively, three, six or nine months
after the first day of that Financial Year or on the last day of
that Financial Year;
FINANCIAL STATEMENTS: according to the context in which it is used,
the Pro-Forma Balance Sheet or any financial statements required to
be delivered to the Agent pursuant to clause 15.2 and complying with
the provisions of clause 15.3;
FINANCIAL YEAR: any period of twelve months ending on 31 December;
FOREIGN CURRENCY: dollars, euros or such other currency which is
freely transferable and freely convertible into sterling as may at
any time be specifically agreed by the Agent;
GROUP: BMEP and its Subsidiaries at any time (but excluding, unless
the Agent otherwise agrees, any member of the Solutions Group) and
"GROUP COMPANY" shall mean any one of them;
GUARANTEE: any guarantee (which has been specifically agreed between
the relevant Borrower and the Agent) of the obligations of any
person issued by the Issuer at the request of that Borrower pursuant
to the terms of clause 6.4;
GUARANTORS: each Secured Guarantor and each Unsecured Guarantor and
"GUARANTOR" means any one of them;
HAZARDOUS SUBSTANCE: any radioactive emissions and any natural or
artificial substance (whether in solid or liquid form or in the form
of a gas or vapour and whether alone or in combination with any
other substance) capable of causing harm to the environment, human
health or welfare or to any organism, including (without limitation)
any type of waste or any form of energy;
HEDGE PROVIDER: the Arranger, any Lender or any other bank or
financial institution of international standing whose long term
unsecured debt securities are, on the date that it enters into any
Hedging Agreement, rated at least A+ by S&P or A1 by Xxxxx'x;
HEDGING AGREEMENT: any agreement or instrument between a Borrower
and a Hedge Provider relating to the hedging of an interest rate or
a currency exposure (including a swap, option, cap, collar or
floor);
IDEAL PRO-FORMA BALANCE SHEET: the pro-forma consolidated (and
consolidating) balance sheet of the IHL Group as at 31 August 2003
prepared by Ideal in accordance with Applicable GAAP;
IHL GROUP: Ideal and its Subsidiaries for the time being;
INFORMATION MEMORANDUM: the document in the form approved by Ideal
concerning the Group which, at Ideal's request, and on its behalf,
was prepared by the Arranger in relation to the transactions
contemplated by this Agreement and distributed to selected financial
institutions;
14
INTERCOMPANY ACCOUNTS: all assets and liabilities, however arising,
which are due to any Trading Company from, which are due from any
Trading Company to, or which otherwise arise from any transaction by
any Trading Company with, any Affiliate;
INTEREST PERIOD: any of those periods referred to in clause 7 (by
reference to which interest is calculated on any LIBOR Revolving
Loan) or in clause 18.2 (by reference to which interest is
calculated on an unpaid sum) provided that, save in respect of any
Interest Periods relating to an unpaid sum, no Interest Period shall
extend beyond the Termination Date;
INVENTORY: in relation to each Trading Company, all of its now owned
and hereafter acquired inventory, goods and merchandise, wherever
located, to be furnished under any contract of service or held for
sale or lease, all raw materials, work-in-progress, finished goods,
returned goods and materials and supplies of any kind, nature or
description which are or might be used or consumed in its business
or used in connection with the manufacture, packing, shipping,
advertising, selling or finishing of such goods, merchandise and
other personal property, and all documents of title or other
documents representing them;
INVENTORY ELIGIBILITY DATE: the date, if any, upon which the Lenders
shall have agreed, and the Agent shall have advised Ideal to that
effect, that Eligible Inventory may be eligible as the basis for
Revolving Loans;
JURISDICTION: the jurisdiction of incorporation of the relevant Baby
Xxxx;
LATEST PROJECTIONS: (i) on the Effective Date and thereafter until
the Agent receives new projections pursuant to clause 15.2.3, the
projections provided by Ideal of the consolidated (and
consolidating) monthly financial condition, results of operations
and cash flow of Ideal and the Baby Bells for the period ending 31
December 2005 (and showing separate projections for the period up to
31 December 2004 and the subsequent period from 1 January 2005 until
31 December 2005) and (ii) thereafter, the projections most recently
received by the Agent pursuant to clause 15.2.3;
LENDER: means:
(i) any Original Lender; and
(ii) any bank, financial institution, trust, fund or other entity
which has become a party to this Agreement in accordance with
clause 28.3,
which in each case has not ceased to be a party to this Agreement in
accordance with the terms of this Agreement;
LETTER OF CREDIT: any standby letter of credit (which has been
specifically agreed between a Borrower and the Agent) issued by the
Issuer at the request of a Borrower pursuant to the terms of clause
6.4;
LETTER OF CREDIT AND GUARANTEE FEE: the meaning given to it in
clause 22.5;
15
LIBOR: in relation to any LIBOR Revolving Loan or any unpaid sum and
any Interest Period relating to it:
(i) the applicable Screen Rate; or
(ii) (if no Screen Rate is available for the currency or Interest
Period of that Loan or unpaid sum) the arithmetic mean of the
rates (rounded up to 4 decimal places) as supplied to the
Agent at its request quoted by the Reference Banks to leading
banks in the London Interbank Market,
at or about 11.00 a.m. in London on the Quotation Date for a period
comparable to the relevant Interest Period;
LIBOR REVOLVING LOAN: a revolving loan made or to be made by the
Lenders in relation to which interest thereon is to be calculated by
reference to LIBOR;
LOANS: each Revolving Loan and Swingline Loan and "LOAN" means any
one of them;
MAJORITY LENDERS: Lenders whose Outstandings together exceed
sixty-six and two-thirds per cent (66?%) of the Outstandings of all
the Lenders (or, if there are no Outstandings, Lenders whose
Commitments together exceed sixty-six and two-thirds per cent (66?%)
of the Total Commitments) provided that, if at any time there are
only two Lenders party to this Agreement "MAJORITY LENDERS" shall
mean both of them together;
MANAGEMENT ACCOUNTING PERIOD: each period of one calendar month
ending on the last day of that month;
MANAGEMENT ACCOUNTS: as at the date of this Agreement, the unaudited
but consolidated and consolidating management accounts of BMEP,
BMEBV and the Group in respect of the Management Accounting Period
ended 31 October 2002 to be prepared in accordance with Applicable
GAAP and in a format agreed by the Agent and thereafter those
accounts or the then latest such accounts for successive Management
Accounting Periods required to be delivered to the Agent pursuant to
clause 15.2.2;
MANDATORY COST: the percentage rate per annum calculated by the
Agent in accordance with Schedule 5;
MATERIAL CONTRACTS: each of the contracts details of which are set
out in Schedule 10 and any other contract from time to time
designated as a Material Contract by the Agent and Ideal;
MAXIMUM ELIGIBILITY AMOUNT: the amount which is equal to the sum of:
(a) 80% of the Net Amount of Eligible Accounts (the "ACCOUNTS
ADVANCE Rate"). If at any time, but not earlier than six (6)
months after the Closing Date, the Agent determines that the
Dilution Percentage for the Borrowers (as a whole) has been
equal to or less than 5% for a continuous period of three (3)
months ending on the date of such determination, the Agent, in
its absolute discretion (upon completing a
16
field exam and such other reviews as it deems appropriate),
may increase the Accounts Advance Rate to 85%. "DILUTION
PERCENTAGE" means the percentage figure obtained by dividing
(A) all credits, allowances, discounts, write-offs,
contra-accounts and other set-offs incurred in any month which
reduce the value of Accounts for the Borrowers (as a whole) by
(B) the gross amount of all cash received and retained in the
Receivables Accounts from all Accounts created by the
Borrowers (as a whole) in such month: notwithstanding but
without prejudice to the foregoing, the Agent shall have the
right to reduce the Accounts Advance Rate or to establish
reserves, if the Agent at any time determines that the
Dilution Percentage has increased; plus
(b) after the Inventory Eligibility Date, if applicable, up to 60%
of the value of Eligible Inventory;
MAXIMUM REVOLVING CREDIT LINE: the amount of(pound)75,000,000 or
such other amount as may be agreed between the Agent and Ideal;
NET AMOUNT OF ELIGIBLE ACCOUNTS: the gross amount of Eligible
Accounts less sales, excise or similar taxes, and less returns,
discounts, claims, credits and allowances of any nature at any time
issued, owing, granted, outstanding, available or claimed in respect
of such Eligible Accounts;
NOTICE OF CONVERSION/CONTINUATION: the meaning given to it in clause
7.5.2;
OBLIGORS: each Borrower, each Charging Company, each Guarantor, BMEP
and each other member of the Group which has, or may be required by
the Agent to have, any liability from time to time, whether actual
or contingent, present or future, for the payment of any amounts
outstanding or capable of becoming outstanding under any of the
Finance Documents and "OBLIGOR" means any one of them;
ORIGINAL STERLING AMOUNT: in relation to a Loan, the amount
specified in sterling in the Utilisation Notice relating to that
Loan (or, if the amount requested is denominated in a Foreign
Currency, that amount converted into sterling at the Agent's Spot
Rate of Exchange on the date which is three business days before the
Utilisation Date or, if later, on the date the Agent received the
Utilisation Notice);
OUTSTANDINGS: in relation to a Lender at any time, the Original
Sterling Amount of the aggregate principal amount of its share of
all (if any) Utilisations, including (in relation to the Issuer) the
Original Sterling Amount of the aggregate of its contingent
liabilities in respect of any such Utilisations consisting of the
issue of any Letters of Credit or Guarantees outstanding at that
time;
PARENT: Xxxx Microproducts Inc.;
PARTICIPATING PROPORTION: in relation to a Lender and a sum payable
to or by it on any date, the proportion which the Commitment of that
Lender bears to the Total Commitments on that date;
17
PERMITTED ENCUMBRANCE: any encumbrance permitted under clause
16.3.1;
PERMITTED INDEBTEDNESS: any indebtedness permitted under clause
16.3.5;
PRE-APPROVED ACQUISITION: any acquisition of any business, shares or
other assets of any kind by any Group Company which does not require
the prior consent or approval of the Agent or the Lenders by virtue
of the fact that both prior to and at the time of its completion,
each of the Approved Acquisition Conditions were satisfied;
PRIORITY AGREEMENT: the priority agreement, in form and substance
satisfactory to the Agent, entered or to be entered into between (1)
Xxxx Microproducts Limited, (2) the Security Trustee and (3)
National Westminster Bank Plc in its capacity as existing
Chessington Mortgagee;
PRO-FORMA BALANCE SHEET: the pro-forma consolidated (and
consolidating) balance sheet of the Group and each Group Company as
of 31 October 2002 prepared by Ideal in accordance with Applicable
GAAP;
QUALIFYING LENDER: a lender which either:
(i) is a bank as defined in section 840A of the Taxes Act which,
for the purposes of section 349 of the Taxes Act, is within
the charge to corporation tax as regards all interest payable
to it under this Agreement; or
(ii) is a lender (a "TREATY LENDER") which has the benefit of a
double tax treaty which provides a complete exemption from UK
income tax on interest; or
(iii) is a lender (a "UK NON-BANK LENDER") which is beneficially
entitled to interest payable to that lender in respect of a
Loan under this Agreement and is:
(a) a company resident in the United Kingdom for United
Kingdom tax purposes;
(b) a partnership each member of which is a company resident
in the United Kingdom for United Kingdom tax purposes;
or
(c) a company not so resident in the United Kingdom which
carries on a trade in the United Kingdom through a
branch or agency and which is required to bring that
interest into account in computing its chargeable
profits (within the meaning given by section 11(2) of
the Taxes Act),
and has given a Tax Confirmation to the Borrowers;
QUOTATION DATE: in relation to any period for which an interest rate
is to be determined, the day on which quotations would ordinarily be
given by prime banks in the London Interbank Market for deposits in
the currency in relation to which such rate is to be determined for
delivery on the first day of that period provided that, if, for any
such period, quotations would ordinarily be
18
given on more than one date, the Quotation Date for that period
shall be the last of those dates;
RECEIVABLES ACCOUNT: the meaning given to it in the Debenture;
REFERENCE BANKS: such banks as may be appointed by the Agent in
consultation with Ideal;
REFERENCE RATE: in relation to any Loan or unpaid sum denominated in
sterling or any Foreign Currency (as the case may be) on which
interest is to be calculated by reference to Reference Rate, the
Agent's reference rate for sterling or such Foreign Currency being
the rate from time to time set by the Agent based on various factors
including the Agent's cost of funds, desired return and general
economic conditions and which is used as a reference point for
pricing loans made by it in sterling or such Foreign Currency;
REFERENCE RATE REVOLVING LOAN: a revolving loan made or to be made
by the Lenders in relation to which interest thereon is to be
calculated by reference to the Reference Rate;
RELEVANT ACCOUNTING INFORMATION: the meaning given to it in clause
15.4;
RELEVANT AGREEMENTS: the Finance Documents, the Material Contracts
and any Approved Acquisition Documents;
RESERVATIONS: the principle that equitable remedies are remedies
which may be granted or refused at the discretion of the court, the
limitation of enforcement by laws relating to bankruptcy,
insolvency, liquidation, reorganisation, court schemes, moratoria,
administration and other laws generally affecting the rights of
creditors, the time barring of claims under the Limitation Xxx 0000,
the possibility that an undertaking to assume liability for or to
indemnify against non-payment of United Kingdom stamp duty may be
void, the unenforceability of penalty provisions and defences of
set-off or counterclaim and similar principles arising under the
laws of any other jurisdiction in which relevant obligations must be
performed;
RESTRICTED INVESTMENT: any acquisition of any assets by any Group
Company in exchange for cash or other assets, whether in the form of
an acquisition of shares, debt securities or other indebtedness or
obligation, or the purchase or acquisition of any other assets, or a
loan, advance, capital contribution or subscription, except the
following:
(i) acquisitions of fixed assets to be used in the business of
such Group Company, so long as the acquisition costs thereof
constitute Capital Expenditure permitted hereunder; and
(ii) acquisitions of goods held for sale or lease or to be used in
the rendering of services by such Group Company in the
ordinary course of business;
(iii) any acquisition of shares, debt securities or other
indebtedness or obligation, or the making of any loan,
advance, capital contribution or subscription by any Group
Company in or to any other Group
19
Company which is loss-making and solely for the purpose of
recapitalising such loss-making Group Company, provided always
that, unless (A) the funds (the "INVESTMENT FUNDS") employed
by the investing Group Company have been made available to it
wholly by the Parent (directly or through BMEP) and not by the
utilisation of any amounts drawn down under this Agreement and
(B) the investment funds are the proceeds of a new capital
injection (whether by way of debt or equity) into the
investing Group Company occurring after the Effective Date and
not monies already available to such investing Group Company,
then such capital injection by the relevant investing Group
Company may not exceed (pound)500,000 without the prior
consent of the Agent;
(iv) any Pre-Approved Acquisition;
REVIEW DATE: the meaning given to it in Clause 7.6.1;
REVOLVING FACILITY: the facility referred to in clause 2.1;
REVOLVING FACILITY AMOUNT: the lesser of:
(i) the Maximum Revolving Credit Line; and
(ii) the Maximum Eligibility Amount;
REVOLVING LOAN: each LIBOR Revolving Loan and each Reference Rate
Revolving Loan made or to be made by the Lenders pursuant to the
Revolving Facility;
SCREEN RATE: the British Bankers Association Interest Settlement
Rate for the relevant currency and period displayed on page 3750 of
the Telerate screen; if the agreed page is replaced or service
ceases to be available, the Agent may specify another page or
service displaying the appropriate rate after consultation with
Ideal and the Lenders;
SECURED GUARANTOR: each Charging Company;
SECURED OBLIGATIONS: the meaning given to it in the Debenture;
SECURITY DOCUMENTS: the Debenture, the Priority Agreement and any
document creating an encumbrance over any asset of any Obligor
entered into pursuant thereto and any other security document
granted to the Security Trustee as security for the obligations of
the Obligors to the Beneficiaries;
SECURITY INTEREST: collectively the encumbrances granted to the
Security Trustee in the Collateral pursuant to the Security
Documents or any other agreement or instrument;
SOLUTIONS GROUP: at any time, Xxxx Microproducts Europe Solutions BV
and its Subsidiaries at such time and "MEMBER OF THE SOLUTIONS
GROUP" means any one of them;
20
SUBSIDIARY: a subsidiary (as that term is defined in section 736
Companies Act 1985) provided that, for the purposes of the
definition of "FINANCIAL STATEMENTS", clauses 14.1.10, 14.1.22 and
15 and the definition of "GROUP" in each such clause, the term
"SUBSIDIARY" shall include a subsidiary undertaking (as that term is
defined in section 258 Companies Act 1985);
SUPPLEMENTAL AGREEMENT: the agreement supplemental to this Agreement
dated on or about 6 November 2003 entered into by the parties
hereto;
SUPPLEMENTAL DEED: a deed supplemental to the Debenture,
substantially in the form set out in schedule 9 to the Debenture,
entered or to be entered into by a Group Company pursuant to which
that Group Company accedes to the Debenture as a Charging Company;
SWINGLINE LOAN: a swingline loan made or to be made by the Swingline
Lender pursuant to clause 6.3;
TAXES ACT: the Income and Corporation Taxes Xxx 0000;
TAX CONFIRMATION: a confirmation by a person which is a Lender under
this Agreement that the person beneficially entitled to interest
payable to that Lender in respect of a Loan under this Agreement is
either:
(i) a company resident in the United Kingdom for United Kingdom
tax purposes; or
(ii) a partnership each member of which is a company resident in
the United Kingdom for United Kingdom tax purposes; or
(iii) a company not so resident in the United Kingdom which carries
on a trade in the United Kingdom through a branch or agency
and which is required to bring that interest into account in
computing its chargeable profits (within the meaning given by
section 11(2) of the Taxes Act);
TERMINATION DATE: subject to clause 9.5, the date falling 36 months
after the Closing Date;
TOTAL COMMITMENTS: the aggregate at any time of the Commitments of
all the Lenders;
TOTAL OUTSTANDINGS: the aggregate at any time of the Outstandings of
all the Lenders;
TRADING COMPANY: each Group Company with Eligible Accounts and, if
applicable following the Inventory Eligibility Date, with such
Eligible Inventory as the Agent may agree in writing;
TRANSFER CERTIFICATE: a certificate substantially in the form set
out in Schedule 6 completed in accordance with clause 28;
TRANSFEREE: a Lender or other financial institution which is a
Qualifying Lender to which a Lender seeks to transfer rights and
obligations under this Agreement in accordance with clause 28;
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TRUST PROPERTY: all or any of the assets, rights, powers,
authorities and discretions at any time subject to or expressed to
be subject to the security from time to time constituted by or
arising pursuant to the Security Documents or vested in the Security
Trustee or given under or pursuant to the Security Documents
including all income and other sums at any time received or
receivable by the Security Trustee in respect thereof;
UNSECURED GUARANTOR: a Group Company which has acceded to this
Agreement as an unsecured guarantor by executing and delivering to
the Agent an Accession Notice in accordance with clause 3 and
"UNSECURED GUARANTOR" means any one of them;
UNUSED LINE FEE: the meaning given to it in clause 22.1;
UTILISATION: a utilisation consisting of the drawdown of a Swingline
Loan or Revolving Loan or the issue by the Issuer of a Letter of
Credit or Guarantee;
UTILISATION NOTICE: a notice of Utilisation substantially in the
form set out in Schedule 4; and
VAT: value added tax or any similar tax substituted therefor.
1.2 CONSTRUCTION
Any reference in this Agreement to:
1.2.1 the "AGENT", the "ARRANGER", the "SECURITY TRUSTEE", the
"ISSUER", the "SWINGLINE LENDER" or any "LENDER" shall be
construed so as to include their respective successors,
Transferees and assignees in accordance with their respective
interests;
1.2.2 "THIS AGREEMENT" or to any other agreement or document shall,
unless the context otherwise requires, be construed as a
reference to this Agreement or such other agreement or
document as the same may from time to time be amended, varied,
supplemented, novated or replaced and shall include any
document which is supplemental to, is expressed to be
collateral with, or is entered into pursuant to or in
accordance with, the terms of this Agreement or, as the case
may be, such other agreement or document;
1.2.3 the "ASSETS" of any person shall be construed as a reference
to all or any part of its business, operations, undertaking,
property, assets, revenues (including any right to receive
revenues) and uncalled capital;
1.2.4 a "BUSINESS DAY" is a reference to a day (other than a
Saturday or Sunday) on which banks generally are open for
business in London and:
(a) (in relation to any date for the payment or purchase of
a currency other than euro) in the principal financial
centre of the country of that currency; or
22
(b) (in relation to any date for the payment or purchase of
euro) which is a TARGET Day;
1.2.5 a "CAPITAL ADEQUACY REGULATION" shall be construed as a
reference to any guideline, request or directive of any
central bank or public authority, or any other law, rule or
directive or regulation, whether or not having the force of
law, in each case, regarding capital adequacy of any bank or
of any corporation controlling a bank;
1.2.6 a document being a "CERTIFIED COPY" of another means such
document is certified by a duly authorised officer of the
relevant Obligor (or by reputable solicitors to the relevant
Obligor from time to time) as being a true, complete, accurate
and up-to-date copy of the original;
1.2.7 a person being "CONTROLLED" by another means that that other
(whether directly or indirectly and whether by the ownership
of share capital, the possession of voting power, contract or
otherwise) has the power to appoint and/or remove all or the
majority of the members of the board of directors or other
governing body of that person or otherwise controls or has the
power to control the affairs and policies of that person;
1.2.8 a "CREDIT AGREEMENT" shall be construed as a reference to any
conditional sale agreement (as defined in the Consumer Credit
Act 1974), hire purchase or credit sale agreement or other
similar agreement entered into primarily as a method of
financing the acquisition of the asset which is the subject of
such agreement;
1.2.9 a Default which is "CONTINUING" shall be construed as a
reference to a Default which has not been remedied or waived;
1.2.10 "DOLLARS" and "US$" shall mean the lawful currency of the
United States of America;
1.2.11 "EMU LEGISLATION" means legislative measures of the European
Communities for the introduction of, changeover to or
operation of the euro;
1.2.12 an "ENCUMBRANCE" shall be construed as a reference to a
mortgage, charge, assignment by way of security, pledge, lien,
hypothecation, right of set-off, reservation of title
arrangement, preferential right (save as arising under the
general law for the protection of certain classes of
creditors) or any trust, flawed asset or other arrangement for
the purpose of and having a similar effect to the granting of
security, or other security interest of any kind;
1.2.13 "EURO" and "EUR" means the single currency adopted by certain
participating member states of the European Communities in
accordance with EMU legislation;
23
1.2.14 a "FINANCE LEASE" shall be construed as a reference to any
lease or other similar agreement entered into primarily as a
method of financing the use of the asset which is the subject
of such lease or agreement;
1.2.15 "FINANCIAL INDEBTEDNESS" shall be construed as a reference to
any indebtedness under or in respect of:
(a) monies borrowed or raised (including by way of
preference share capital but excluding by way or
ordinary shares);
(b) any debenture, bond, note, loan stock, commercial paper
or similar instrument;
(c) any acceptance credit, xxxx-discounting, note purchase
or documentary credit facility;
(d) any credit agreement or finance lease;
(e) any receivables purchase, factoring or discounting
arrangement under which there is recourse in whole or in
part to any member of the Group;
(f) credit (other than normal trade credit for a period not
exceeding 90 days) or deferred payment arrangements in
respect of the acquisition or construction price of
assets acquired or constructed or the purchase price of
services supplied;
(g) any other transaction having the commercial effect of a
borrowing or other raising of money entered into by a
person to finance its business or operations or capital
requirements; or
(h) (without double counting) any guarantee or other
assurance against financial loss in respect of the
indebtedness of any person arising under an obligation
falling within (a) to (g) above;
1.2.16 the "FINANCIAL STATEMENTS" or the "MANAGEMENT ACCOUNTS" shall
be construed so as to include any notes, reports, statements
or other documents annexed or attached to any of them;
1.2.17 a "GUARANTEE" shall be construed so as to include an
indemnity, bond, standby letter of credit and any other
obligation (whatever called) of any person to pay for,
purchase, provide funds (whether by the advance of money, the
purchase or subscription for shares or other securities, the
purchase of assets or services or otherwise) for the payment
of, indemnify against the consequences of default in the
payment of, or otherwise be responsible for, any indebtedness
or other obligation of any other person (and "GUARANTEED" and
"GUARANTOR" shall be construed accordingly);
24
1.2.18 "INDEBTEDNESS" shall be construed as a reference to any
obligation for the payment or repayment of money, whether as
principal or as surety and whether present or future, actual
or contingent;
1.2.19 a document expressed to be "IN THE APPROVED TERMS" is a
reference to a document the terms, conditions and form of
which have been initialled for the purpose of identification
by or on behalf of the Agent;
1.2.20 something having a "MATERIAL ADVERSE EFFECT" on a person shall
be construed as a reference to it having a material adverse
effect (i) on its financial condition, business or operations
or on the consolidated financial condition, business or
operations of it and its Subsidiaries or (ii) on its ability
to comply with its payment obligations under any Finance
Document;
1.2.21 a "MONTH" is a reference to a period starting on one day in a
calendar month and ending on the numerically corresponding day
in the next calendar month save that, where any such period
would otherwise end on a day which is not a business day, it
shall end on the next business day, unless that day falls in
the calendar month succeeding that in which it would otherwise
have ended, in which case it shall end on the preceding
business day provided that, if a period starts on the last
business day in a calendar month or if there is no numerically
corresponding day in the month in which that period ends, that
period shall end on the last business day in that later month;
1.2.22 a "PARTICIPATING MEMBER STATE" is a reference to any member
state of the European Communities which adopts or has adopted
the euro as its lawful currency in accordance with EMU
legislation;
1.2.23 a "PERSON" shall be construed as a reference to any
individual, firm, company, corporation, public authority or
any association or partnership (whether or not having separate
legal personality) of two or more of the foregoing;
1.2.24 a "PUBLIC AUTHORITY" shall be construed as a reference to any
government of any country or sovereign state or any political
sub-division thereof or any department, agency, public
corporation or other instrumentality of any of the foregoing;
1.2.25 a "REGULATION" shall be construed so as to include any
regulation, rule, by-law, official directive, requirement,
request or guideline (whether or not having the force of law)
of any governmental body, agency, department or regulatory,
self-regulatory or other authority or organisation;
1.2.26 "STERLING" and "(POUND)" denotes the lawful currency of the
United Kingdom;
25
1.2.27 the "STERLING EQUIVALENT" of (i) any amount denominated in a
Foreign Currency shall mean the equivalent in sterling of such
amount as determined by the Agent by reference to the Agent's
Spot Rate of Exchange and of (ii) any amount denominated in
sterling shall mean such sterling amount;
1.2.28 "TARGET" is a reference to Trans-European Automated Real-time
Gross Settlement Express Transfer payment system;
1.2.29 "TARGET DAY" is a reference to any day on which TARGET is open
for the settlement of payments in euro;
1.2.30 "TAX" shall be construed so as to include any present and
future tax, levy, impost, deduction, withholding, duty or
other charge of a similar nature (including, without
limitation, any penalty or interest payable in connection with
any failure to pay or any delay in paying any of the same);
1.2.31 "TAX ON OVERALL NET INCOME" of a person shall be construed as
a reference to tax (other than tax deducted or withheld from
any payment) imposed on that person by the jurisdiction in
which its principal office (and/or, in the case of a Lender,
its Facility Office) is located on (i) the net income, profits
or gains of that person world-wide or (ii) such of its net
income, profits or gains as arise in or relate to that
jurisdiction;
1.2.32 an "UNPAID SUM" is a reference to an unpaid sum as that term
is defined in clause 18.1;
1.2.33 the "WINDING-UP", "DISSOLUTION", "ADMINISTRATION",
"RECEIVERSHIP" or "BANKRUPTCY" of a person and references to
the "LIQUIDATOR", "ADMINISTRATOR", "RECEIVER", "ADMINISTRATIVE
RECEIVER", "RECEIVER AND MANAGER", "MANAGER" or "TRUSTEE" of a
person shall be construed so as to include any equivalent or
analogous proceedings or, as the case may be, insolvency
representative or officer under the law of the jurisdiction in
which such person or, as the case may be, insolvency
representative or officer is incorporated or constituted or of
any jurisdiction in which such person or, as the case may be,
insolvency representative or officer, carries on business.
1.3 Any reference in this Agreement to any statute or statutory provision
shall, unless the context otherwise requires, be construed as a
reference to such statute or statutory provision (including all
instruments, orders or regulations made thereunder or deriving validity
therefrom) as in force at the date of this Agreement and as
subsequently re-enacted or consolidated.
1.4 Any reference in this Agreement to a time of day shall, save where the
context otherwise requires, be construed as a reference to London time.
26
1.5 In construing this Agreement general words introduced by the word
"OTHER" shall not be given a restrictive meaning by reason of the fact
that they are preceded by words indicating a particular class of acts,
matters or things and general words shall not be given a restrictive
meaning by reason of the fact that they are followed by particular
examples intended to be embraced by the general words.
1.6 The illegality, invalidity or unenforceability of any provision of this
Agreement under the law of any jurisdiction shall not affect its
legality, validity or enforceability under the law of any other
jurisdiction nor the legality, validity or enforceability of any other
provision of this Agreement.
1.7 This Agreement supersedes any previous agreement, whether written or
oral, express or implied, between the Original Borrowers, the Arranger,
the Agent, the Security Trustee and the Lenders, or any of them, in
relation to the subject matter of this Agreement.
1.8 The headings in this Agreement are for convenience only and shall not
affect its meaning and references to a clause, Schedule or paragraph
are (unless otherwise stated) to a clause of, or schedule to, this
Agreement and to a paragraph of the relevant Schedule.
1.9 This Agreement may be signed in any number of counterparts, all of
which taken together shall constitute one and the same instrument. Any
party may enter into this Agreement by signing any such counterpart.
1.10 Save where the context otherwise requires, the plural of any term
includes the singular and vice versa.
1.11 Except as provided in clause 27.13, the terms of this Agreement may
only be enforced by a party to it and the operation of the Contracts
(Rights of Third Parties) Act 1999 is excluded. Notwithstanding such
clause, the parties to this Agreement do not require the consent of any
third party to rescind or vary this Agreement or any Finance Document
at any time.
1.12 Nothing in this Agreement or envisaged hereby shall operate, whether
directly or indirectly, to constitute a partnership between any Obligor
and any of the Beneficiaries.
1.13 The liabilities and obligations of the Obligors under the Finance
Documents to which each of them is expressed to be a party are and
shall be construed as being, joint and several.
2 THE REVOLVING FACILITY
2.1 THE REVOLVING FACILITY
Subject to the terms and conditions of this Agreement, the Lenders
shall make available to the Borrowers a revolving credit facility (the
"REVOLVING FACILITY") of up to (pound)75,000,000. The Revolving
Facility (as described in clause 6 shall consist of Revolving Loans (to
be denominated in sterling and/or, if agreed between the relevant
Borrower and the Agent, dollars, euro or one or more other Foreign
Currencies) to be made by the Lenders and, if
27
specifically agreed by the Agent (on the instructions of the Issuer),
Letters of Credit and/or Guarantees to be issued by the Issuer (subject
to reimbursement by the relevant Borrower and each of the Lenders on
the terms set out in this Agreement) and Swingline Loans (to be
denominated in sterling and/or dollars, euros or such one or more other
Foreign Currencies as may be agreed between the relevant Borrower and
the Swingline Lender), to be made by the Swingline Lender (subject to
reimbursement by the Lenders on the terms set out in this Agreement) in
a maximum aggregate principal Original Sterling Amount not exceeding
the Revolving Facility Amount.
2.2 PURPOSE
The Revolving Facility is to be applied to meet each Borrower's general
working capital purposes and each Borrower shall apply all amounts
raised by it under this Agreement accordingly provided that none of the
Agent, the Security Trustee or any of the Lenders shall be obliged to
concern itself with the application of amounts raised by any Borrower
under this Agreement.
2.3 OBLIGATIONS SEVERAL
The obligations of each Lender under this Agreement are several. The
failure by any Lender to perform its obligations under this Agreement
shall not affect the obligations of any Obligor towards any other party
to this Agreement nor shall any such other party be liable for the
failure by such Lender to perform its obligations.
2.4 RIGHTS SEVERAL
The rights of each Lender are several. The amount at any time owing by
any Borrower to any party under this Agreement shall be a separate and
independent debt from the amount owing to any other party.
2.5 FINANCIAL ASSISTANCE
None of the proceeds of any Utilisation of the Revolving Facility under
this Agreement may be used in any way which infringes section 151
Companies Xxx 0000 or any similar or other statutory obligation whether
in the United Kingdom or elsewhere unless the provisions of sections
155 to 158 thereof are actually complied with.
2.6 CONTINUING OBLIGATIONS
The obligations of any party under or in respect of clauses 10, 11, 18,
19, 20.7, 24 and 26.9 shall continue even after the date (the
"DISCHARGE DATE") upon which the Total Commitments have been cancelled
or otherwise reduced to zero and the Outstandings of all the Lenders
have been permanently repaid or prepaid, to the extent of and in
respect of any cost, expense, loss, liability or claim indemnifiable
under any such clause and suffered or incurred by any Beneficiary on or
prior to the Discharge Date.
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3. ADDITIONAL BORROWERS AND UNSECURED GUARANTORS
3.1 REQUEST OR REQUIREMENT
Ideal may request that any Group Company shall become an Additional
Borrower or, as applicable, the Agent may require that any Group
Company shall become an Unsecured Guarantor by giving to the Agent or,
as applicable, to Ideal not less than 10 business days' notice. For the
avoidance of doubt, any Additional Borrower shall, unless the Agent
otherwise agrees, automatically be required also to become a Charging
Company pursuant to clause 4, without the need for the Agent to serve a
further notice in accordance with clause 4.
3.2 ACCESSION
The Group Company in respect of which the request or, as the case may
be, requirement is made pursuant to clause 3.1 shall become an
Additional Borrower or, as applicable, an Unsecured Guarantor:
3.2.1 if the Lenders approve or, as applicable, require the addition
of that Group Company as an Additional Borrower or, as
applicable, as an Unsecured Guarantor;
3.2.2 upon Ideal delivering to the Agent a duly completed and
executed Accession Notice;
3.2.3 in the case of a request to appoint an Additional Borrower, if
no Default has occurred or is likely to occur as a result of
that Group Company becoming an Additional Borrower;
3.2.4 if the Agent has received all of the documents and other
evidence specified in Schedule 9 in relation to that Group
Company and each is in form and substance satisfactory to the
Agent.
For the avoidance of doubt, no Accounts or Inventory of any Group
Company which is to become an Additional Borrower shall be considered
as Eligible Accounts or Eligible Inventory, unless the Agent has
completed a field examination and such other due diligence as the Agent
may require and such Accounts and Inventory satisfy the applicable
conditions set forth in this Agreement.
3.3 TIMING
The Agent shall notify Ideal and the Lenders promptly upon being
satisfied that it has received all of the documents and other evidence
specified in Schedule 9 in relation to the relevant Group Company and
that each is in form and substance satisfactory to it, whereupon
subject always to clauses 3.2.1, 3.2.2 and, in the case of a proposed
Additional Borrower, clause 3.2.3, the relevant Group Company shall
become an Additional Borrower or, as applicable, an Unsecured
Guarantor.
29
3.4 IDEAL AS AGENT
Each Borrower and each Unsecured Guarantor shall be deemed to appoint
Ideal as its agent for the purposes of the Finance Documents by its
execution of an Accession Notice. The Agent may rely on a document
signed by Ideal as if it had been signed by any other Borrower or any
Unsecured Guarantor. Ideal may give a good receipt for any sum payable
by any Finance Party to any other Borrower or an Unsecured Guarantor.
Any communication delivered to Ideal shall be deemed to have been
delivered to each of the Borrowers and each Unsecured Guarantor. Any
communication made by Ideal to the Agent or any other Finance Party
shall, to the extent permissible by law, be deemed to have been made
with the consent of each other Borrower and each Unsecured Guarantor.
3.5 REPETITION OF REPRESENTATIONS
Delivery of an Accession Notice constitutes confirmation by the
relevant Additional Borrower or, as applicable, Unsecured Guarantor
that the representations and warranties set out in clause 14.1 which
are required to be repeated pursuant to clause 14.2 are true and
correct in all material respects in relation to it as at the date of
delivery as if made by reference to the facts and circumstances then
existing.
4 ADDITIONAL CHARGING COMPANIES
4.1 REQUIREMENT
The Agent (acting on the instructions of the Lenders) may require that
any Group Company becomes a Charging Company by giving to Ideal not
less than 10 business days' notice, provided that any Group Company
which has acceded to this Agreement as an Additional Borrower shall,
unless the Agent otherwise agrees, automatically be required to become
a Charging Company without the need for the Agent to serve a notice
under this clause 4.
4.2 ACCESSION
The Group Company in respect of which the requirement is made (or, in
the case of an acceding Additional Borrower, is deemed to have been
made) pursuant to clause 4.1 shall become a Charging Company:
4.2.1 (other than in the case of a Group Company acceding to this
Agreement as an Additional Borrower (in which case, accession
as a Charging Company shall, unless the Agent otherwise
agrees, be automatic)), if the Lenders require the addition of
that Group Company as a Charging Company;
4.2.2 upon Ideal delivering to the Agent a duly completed and
executed Supplemental Deed;
4.2.3 if no Default has occurred or is likely to occur as a result
of that Group Company becoming a Charging Company; and
30
4.2.4 if the Agent has received all of the following documents and
other evidence in relation to that Group Company specified in
Schedule 9 (which shall be required to be delivered within 60
days of receipt (or deemed receipt) of notice under clause
4.1) and each is in form and substance satisfactory to the
Agent.
4.3 TIMING
The Agent shall notify Ideal and the Lenders promptly upon being
satisfied that it has received all of the documents and other evidence
specified in Schedule 9 in relation to the relevant Group Company and
that each is in form and substance satisfactory to it, whereupon
subject always to clauses 4.2.1 to 4.2.3 (inclusive) the relevant Group
Company shall become a Charging Company.
4.4 IDEAL AS AGENT
Each Charging Company shall be deemed to appoint Ideal as its agent for
the purposes of the Finance Documents by its execution of a
Supplemental Deed. The Agent may rely on a document signed by Ideal as
if it had been signed by each other Charging Company. Ideal may give a
good receipt for any sum payable by any Finance Party to each other
Charging Company. Any communication delivered to Ideal shall be deemed
to have been delivered to each of the Charging Companies. Any
communication made by Ideal to the Agent shall, to the extent
permissible by law, be deemed to have been made with the consent of
each other Charging Company.
4.5 REPETITION OF REPRESENTATIONS
Delivery of a Supplemental Deed constitutes confirmation by the
relevant Charging Company that the representations and warranties set
out in clause 14.1 which are required to be repeated pursuant to clause
14.2 are true and correct in all material respects in relation to it as
at the date of delivery as if made by reference to the facts and
circumstances then existing.
5 CONDITIONS PRECEDENT
The Lenders shall be under no obligation to make the Revolving Facility
available under this Agreement unless the Agent has received, or the
Lenders are satisfied that the Agent will receive at the same time as
or immediately prior to the making available of the Revolving Facility,
in form and substance satisfactory to it, all of the documents and
evidence referred to in Schedule 2 (save to the extent that the Agent
may at any time waive such receipt).
6 UTILISATION OF THE REVOLVING FACILITY
6.1 GENERAL CONDITIONS OF UTILISATION
The Lenders shall not be obliged to make the Revolving Facility
available and no Utilisation Notice in respect of the Revolving
Facility shall become effective unless the provisions with respect to
Excess Availability outlined at clause 16.2.14 are complied with;
31
and either:
6.1.1 no Default has occurred and is continuing or would occur if
the Revolving Facility was made available and the
representations set out in clauses 14.1 and 14.2 to be
repeated on and as of the proposed date for the making
available of the Revolving Facility are true and correct in
all material respects on and as of such date; or
6.1.2 the Lenders have agreed (notwithstanding any such matter) to
make the Revolving Facility available and no notice of
termination of this Agreement has been given by Ideal as
referred to in clause 29.
6.2 REVOLVING LOANS
Subject to the terms of this Agreement, a Revolving Loan will be made
by the Lenders to a Borrower on its request if:
6.2.1 not later than 11.00 am on the business day immediately prior
to the day which is the proposed date for the making of such
Revolving Loan (or three business days in the case of any
Revolving Loan to be denominated in a Foreign Currency), or
such lesser period as the Agent may agree prior to the
proposed date for the making of such Revolving Loan, the Agent
has received from the relevant Borrower a Utilisation Notice
in respect of such Revolving Loan;
6.2.2 the proposed date for the making of such Revolving Loan is a
business day during the Commitment Period;
6.2.3 the Original Sterling Amount of the proposed amount of such
Revolving Loan is a minimum amount of (pound)3,000,000 and an
integral multiple of (pound)1,000,000 (or, where the Revolving
Loan is to be made pursuant to clause 6.8.3, an amount equal
to the Original Sterling Amount of the aggregate principal
amount of the Swingline Loans then outstanding) which is less
than or equal to the lesser of the amount of the Available
Facility and the Available Revolving Facility Amount; and
6.2.4 the proposed Interest Period in respect of such Revolving Loan
is a period of one, two or three months (or such other period
as the Agent may agree) ending on or before the Termination
Date.
6.3 SWINGLINE LOANS
Subject to the terms of this Agreement, a Swingline Loan (which may be
denominated in sterling, dollars, euro or such other Foreign Currency
as the Swingline Lender may agree) will be made by the Swingline Lender
to a Borrower on its request if:
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6.3.1 not later than 11.00 am on the day which is the proposed date
for the making of such Swingline Loan, the Agent has received
from the relevant Borrower a Utilisation Notice in respect of
such Swingline Loan;
6.3.2 the proposed date for the making of such Swingline Loan is a
business day during the Commitment Period.
6.4 LETTERS OF CREDIT AND GUARANTEES
Subject to the terms of this Agreement, if the Agent agrees with a
Borrower (acting on the instructions of the Issuer), the Issuer shall,
at that Borrower's request (contained in a Utilisation Notice) issue
one or more documentary letters of credit (each a "LETTER OF CREDIT")
or Guarantees (each a "GUARANTEE"), in each case denominated in
sterling or any Foreign Currency as the Issuer may agree, for that
Borrower's account. The Issuer will not issue any Letter of Credit or
Guarantee:
6.4.1 if the Original Sterling Amount of the maximum face amount of
the requested Letter of Credit or of the maximum contingent
liability under the requested Guarantee, in each case plus all
commissions, fees and charges due from the relevant Borrower
in connection with its issue, would cause its Available
Commitment or the Available Revolving Facility Amount to be
exceeded at such time;
6.4.2 if the expiry date of the Letter of Credit or Guarantee would
be later than 30 days prior to the Termination Date or a date
falling more than 12 months from its date of issue;
6.4.3 if the Original Sterling Amount of the maximum face amount of
the requested Letter of Credit or of the maximum contingent
liability under the requested Guarantee, when aggregated with
the Original Sterling Amount of the maximum face value of all
Letters of Credit and of the maximum contingent liability
under all Guarantees, in each case then in issue, would exceed
(pound)1,000,000,
unless the Issuer has specifically agreed with that Borrower that it is
prepared to do so.
6.5 UTILISATION NOTICES
6.5.1 Subject to the terms of this Agreement, each Utilisation Notice shall
be irrevocable and shall oblige the relevant Borrower to borrow the
amount so requested or, as the case may be, to give effect to the
Utilisation so requested on the date specified in such Utilisation
Notice upon the terms and subject to the conditions set out in this
Agreement.
6.5.2 The first Utilisation Notice delivered hereunder shall include a
request to draw down as part of the relevant Revolving Loan an amount
equal to the amount of any fees then due and payable to the Arranger,
the Agent and the Lenders and
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to such other valuers and professional advisers as shall have been
agreed with the Agent and the Lenders as being payable therefrom and an
authorisation and direction to the Agent to appropriate for such
purpose the proceeds of so much of the relevant Revolving Loan as is
required to satisfy the payment in full of such fees.
6.6 TERMINATION OF COMMITMENTS
If it has not already been cancelled or otherwise reduced to zero prior
to such time the Commitment of each of the Lenders shall be reduced to
zero at close of business in London on the last day of the Commitment
Period.
6.7 SPECIAL PROVISIONS RELATING TO REVOLVING LOANS
The Agent, in its discretion, may elect to allow the limits of the
Available Revolving Facility Amount to be exceeded on one or more
occasions, provided that the Agent may never exceed the Maximum
Revolving Credit Line. If the Agent does exceed the limits of the
Available Revolving Facility Amount, it may not do so by an amount
which exceeds five (5) per cent. of the amount of the Maximum Revolving
Credit Line and if it does exceed the limits of the Available Revolving
Facility Amount on any occasion, the Agent shall not be deemed thereby
to have changed such limits or to be obliged to exceed such limits on
any other occasion.
6.8 SPECIAL PROVISIONS RELATING TO SWINGLINE LOANS
6.8.1 NOTIFICATION: The Swingline Lender shall notify the Agent and the
Lenders at the end of each week of the net amount of Swingline Loans
then outstanding.
6.8.2 REPAYMENT OF SWINGLINE LOANS: The principal amount of the Swingline
Loans denominated in any currency shall be repaid on a daily basis by
the transfer of the full credit balance on each Receivables Account to
any loan account denominated in that currency maintained by each
Borrower with the Agent as contemplated in clause 20.8 or otherwise on
demand by the Swingline Lender, any such credit balance denominated in
any particular currency to be applied first to the unpaid principal
amount of Swingline Loans denominated in the same currency and
thereafter in or towards repayment of the unpaid principal amount of
any Swingline Loans denominated in any other currency, the manner and
extent of such application to be at the Agent's discretion.
6.8.3 REFUNDING OF SWINGLINE LOANS BY THE LENDERS: The Agent will not less
than weekly and may, at any time in its sole and absolute discretion or
upon request of the Swingline Lender, on behalf of the Borrowers (each
of which hereby irrevocably directs the Agent to act on its behalf in
this respect), give notice to the Lenders (including the Swingline
Lender) requiring that they make a Reference Rate Revolving Loan to the
relevant Borrower in an amount equal to the aggregate principal amount
of the Swingline Loans then outstanding together with all interest
accrued thereon but unpaid. Interest on any such Reference Rate
Revolving Loan shall be calculated and payable in accordance with the
provisions of clause 7.2.2.
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6.8.4 APPLICATION OF REFERENCE RATE REVOLVING LOANS: Regardless of whether
the conditions in this Agreement for the making of Revolving Loans are
then satisfied, each Lender shall make its share of any Reference Rate
Revolving Loan referred to in clause 6.8.3 available to the Agent for
the benefit of the Swingline Lender on the date notice of the
requirement for any such Reference Rate Revolving Loan is given to the
Lenders.
6.9 SPECIAL CONDITIONS FOR ISSUE OF LETTERS OF CREDIT AND GUARANTEES
In addition to being subject to the satisfaction of the applicable
conditions precedent referred to in clause 5, the obligation of the
Issuer to issue any Letter of Credit or Guarantee is subject to the
following conditions having been satisfied in a manner satisfactory to
the Agent:
6.9.1 the relevant Borrower shall have delivered to the Agent, at
such times and in such manner as the Agent may prescribe, an
application in form and substance satisfactory to the Agent
for the issue of the Letter of Credit or Guarantee and such
other documents as may be required pursuant to the terms
thereof;
6.9.2 the form and terms of the proposed Letter of Credit or
Guarantee shall be satisfactory to the Agent and the Issuer;
and
6.9.3 as of the date of issue, no order of any court, arbitrator or
public authority shall purport by its terms to prohibit or
restrain the Issuer or banks generally from issuing letters of
credit or guarantees of the type and in the amount of the
proposed Letter of Credit or Guarantee (as the case may be),
and no law, rule or regulation applicable to the Issuer or
banks generally and no request or directive (whether or not
having the force of law) from any central bank or public
authority with jurisdiction over the Issuer or banks generally
shall prohibit, or request that the Issuer refrain from, the
issue of letters of credit or guarantees generally or the
issue of such Letter of Credit or Guarantee.
6.10 GENERAL CONDITIONS FOR ISSUE OF LETTERS OF CREDIT AND GUARANTEES
6.10.1 REQUESTS FOR ISSUE OF LETTERS OF CREDIT OR GUARANTEES: A Borrower shall
give to the Agent four business days' prior written notice of that
Borrower's request for the issue of any Letter of Credit or Guarantee.
In the case of a Guarantee, such notice shall specify the maximum
contingent liability to be guaranteed, the beneficiary in whose favour
the Guarantee is to be issued, the effective date of issue of such
Guarantee (which shall be a business day), details of the obligation in
respect of which the contingent liability might arise and the date on
which such obligation is due to mature or expire. In the case of a
Letter of Credit, such notice shall specify the original face amount
and currency denomination of the Letter of Credit requested, the
effective date of issue of such Letter of Credit (which shall be a
business day), whether such Letter of Credit may be drawn in a single
or partial draws, the date on which such Letter of Credit is to expire
and the beneficiary of such Letter of Credit.
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6.10.2 NO EXTENSIONS OR AMENDMENT: The Issuer shall not be obliged to extend
or amend or cause to be extended or amended any Letter of Credit or
Guarantee it has issued.
6.10.3 EVENTS OF DEFAULT: The Issuer need not, before issuing a Letter of
Credit or Guarantee, make any enquiry or otherwise concern itself as to
whether any event has occurred which, under the terms hereof, would
relieve the Issuer from its obligations to issue that Letter of Credit
or Guarantee and accordingly none of the Borrowers nor any of the
Lenders shall have any right to resist any claim under clause 6.12 nor
otherwise on the ground that any such event had occurred before the
issue of the Letter of Credit or Guarantee, provided that, before
issuing a Letter of Credit or Guarantee, the Issuer shall inform each
of the Lenders of any Event of Default of which it has actual notice.
6.11 COMPENSATION FOR LETTERS OF CREDIT AND GUARANTEES
Each Borrower agrees to pay to the Agent for the account of the Issuer
with respect to each Letter of Credit or Guarantee, the Letter of
Credit and Guarantee Fee and such other reasonable fees and other
charges as are charged by the Issuer for letters of credit or
guarantees issued by it including, without limitation its standard fees
for issuing, administering, amending, renewing, paying and cancelling
letters of credit and guarantees and all other fees associated with
issuing or servicing letters of credit, as and when assessed, all as
specified in clause 22.5.
6.12 PAYMENTS PURSUANT TO LETTERS OF CREDIT AND GUARANTEES
6.12.1 DEMANDS UNDER A LETTER OF CREDIT OR GUARANTEE: If a demand for payment
is made under a Letter of Credit or Guarantee on the Issuer, the Issuer
shall promptly notify the Agent of such demand and pay the sum demanded
in accordance with the terms of the relevant Letter of Credit or
Guarantee, whereupon:
(a) the Agent shall not later than four hours after receipt of
such demand, if such demand is made prior to 1.00 pm (London
time) on any business day, or otherwise by 10.00 am (London
time) on the next succeeding business day, notify each Lender
of the amount of such demand and such Lender's proportion
thereof which such Lender shall be obliged to pay; and
(b) each Lender shall on the date of such notification make its
share of the amount demanded available to the Agent for the
benefit of the Issuer in immediately available funds.
If any Lender is unable to make its share of such amount available on
such date, it shall nevertheless do so as soon as possible thereafter
and in any event by no later than two business days after the date
notice of such requirement was given to it by the Agent, together with
interest thereon from the date of such notice to the date of payment at
the rate specified by the Agent as representing the Issuer's cost of
funds.
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6.12.2 INDEMNITY: Each Borrower agrees to indemnify and hold harmless the
Issuer in sterling or sterling equivalent from and against all claims,
demands, liabilities, damages, losses, costs, charges and expenses
(including reasonable legal fees) which the Issuer may incur or sustain
as a consequence of the issue of any Letter of Credit or Guarantee or
the performance of its obligations thereunder (save where the same are
caused by the Issuer's gross negligence or wilful misconduct). This is
a continuing indemnity, extends to the ultimate balance of each
Borrower's obligations and liabilities under clause 6 and shall
continue in force notwithstanding any intermediate payment in whole or
in part of those obligations or liabilities.
6.12.3 PAYMENT OF LETTER OF CREDIT OR GUARANTEE OBLIGATIONS: Without limiting
or affecting any of the provisions of this clause 6.12, each Borrower
agrees to reimburse the Agent and each Lender for any draw under any
Letter of Credit or Guarantee immediately upon demand, and to pay the
Agent the amount of all other obligations and other amounts payable to
it under or in connection with any Letter of Credit or Guarantee
immediately when due, irrespective of any claim, set-off, defence or
other right which that Borrower may have at any time against the Agent,
the Lenders, the Issuer or any other person.
6.12.4 REFERENCE RATE REVOLVING LOANS TO SATISFY REIMBURSEMENT OBLIGATIONS: If
the Issuer honours a draw under any Letter of Credit or makes a payment
under a Guarantee and the relevant Borrower shall not have repaid such
amount to the Agent pursuant to clause 6.12.3, the honouring of such
draw or the making of such payment by the Issuer shall of itself cause
there to arise a Reference Rate Revolving Loan by the Lenders of the
amount of such draw or payment which Reference Rate Revolving Loan that
Borrower shall be obliged to repay immediately. In the event of
non-payment of such Reference Rate Revolving Loan, interest thereon
shall be calculated by reference to successive periods of such duration
as the Agent may select at a rate per annum which is the sum of (i) two
per cent (2%) (ii) the Applicable Margin and (iii) the Reference Rate
and shall be paid by the relevant Borrower at the end of the period by
reference to which it is calculated or on such other date as the Agent
may specify by written notice to that Borrower. If not paid on the due
date, the interest shall be added to and form part of the Reference
Rate Revolving Loan on which interest shall accrue and be payable in
accordance with the provisions of this clause 6.12.4.
6.13 LETTERS OF CREDIT AND GUARANTEES - ASSUMPTION OF RISK
6.13.1 AUTHORISATIONS: Each of the Borrowers and the Lenders unconditionally
and irrevocably:
(a) authorise and direct the Issuer to pay any request or demand
for payment under and in accordance with any Letter of Credit
or Guarantee issued by it without requiring proof of the
relevant Borrower's agreement that any amount so demanded or
paid is or was due and notwithstanding that the relevant
Borrower may dispute the validity of any such request, demand
or payment;
(b) confirms that the Issuer deals in documents only and shall not
be concerned with the legality of any claim under any
37
Letter of Credit or Guarantee or any other underlying
transaction or any set-off, counterclaim or defence as between
the relevant Borrower and any beneficiary of any Letter of
Credit or Guarantee; and
(c) agrees that the Issuer need not have any regard to the
sufficiency, accuracy or genuineness of any such request or
demand or any certificate or statement in connection therewith
or any incapacity of or limitation upon the powers of any
person signing or issuing any such request, demand,
certificate or statement which appears on its face to be in
order and agrees that the Issuer shall not be obliged to
enquire as to any such matters and may assume that any such
request, demand, certificate or statement which appears on its
face to be in order is correct and properly made.
6.13.2 RIGHTS OF CONTRIBUTION AND SUBROGATION: Until all amounts which are or
may become payable by the Obligors under or in connection with the
Finance Documents have been irrevocably paid in full and the Agent, the
Issuer, the Swingline Lender and/or the Lenders are under no liability
hereunder, whether actual or contingent, no Borrower shall, by virtue
of any payment made by it under or in connection with or referable to
this clause 6 or otherwise be subrogated to any rights, security or
monies held or received by the Agent, the Lenders and/or the Security
Trustee or be entitled at any time to exercise, claim or have the
benefit of any right of contribution or subrogation or similar right
against any of them and each Borrower irrevocably waives all rights of
contribution or similar rights against each of them.
6.13.3 WAIVER OF DEFENCES: Each Borrower's obligations under this clause 6
shall not be affected by any act, omission, matter or thing which, but
for this provision, might reduce, release or prejudice any of its
obligations hereunder in whole or in part, including without limitation
and whether or not known to it:
(a) any time or waiver granted to or composition with any
beneficiary or any other person;
(b) any taking, variation, compromise, exchange, renewal or
release of, or refusal or neglect to perfect, take up or
enforce, any rights, remedies or securities available to the
Issuer or other person or arising under any Letter of Credit
or Guarantee; or
(c) any unenforceability, illegality or invalidity of any Letter
of Credit or Guarantee to the intent that each Borrower's
obligations under this clause 6 shall remain in full force and
be construed as if there were no such effect.
6.14 SUPPORTING LETTER OF CREDIT; CASH COLLATERAL
If, notwithstanding the provisions of this clause 6 and clause 29 any
Letter of Credit or Guarantee is outstanding upon the termination of
this Agreement, then upon such termination each Borrower shall deposit
with the Security
38
Trustee, at its discretion, with respect to each Letter of Credit or
Guarantee then outstanding, in its favour and at its request either:
6.14.1 a standby letter of credit (a "SUPPORTING LETTER OF CREDIT")
in form and substance satisfactory to the Agent and the
Security Trustee, issued by an issuer satisfactory to the
Lenders in an amount equal to the greatest amount for which
such Letter of Credit may be drawn (or, as the case may be,
the maximum contingent liability under such Letter of Credit
or Guarantee) together with all fees, expenses and charges in
respect thereof (together the "MAXIMUM LIABILITY") under which
Supporting Letter of Credit the Security Trustee is entitled
to draw amounts necessary to reimburse the Issuer (through the
Agent) for payments made by the Issuer under such Letter of
Credit or Guarantee; or
6.14.2 cash in an amount equal to such maximum liability.
Such Supporting Letter of Credit or deposit of cash shall be held by
the Security Trustee as security for, and to provide for the payment
of, the aggregate face amount of all Letters of Credit or, as the case
may be, the aggregate maximum contingent liability under all
Guarantees, remaining outstanding.
6.15 AGENT LOANS
6.15.1 AUTHORISATION: Subject to the provisions of this clause 6.15, the Agent
is hereby authorised by each Borrower and the Lenders, from time to
time in the Agent's reasonable discretion, after the occurrence of a
Default or an Event of Default which is continuing unremedied or
unwaived or at any time that any of the other conditions to the making
available of any Loans hereunder have not been satisfied (and provided
in any such case that it is impractical to contact the Lenders), to
make Reference Rate Revolving Loans (but in any event not to exceed the
Available Facility) to a Borrower on behalf of the Lenders which the
Agent, in its reasonable business judgement, deems necessary or
desirable (i) to preserve or protect any Collateral, (ii) to enhance
the likelihood of, or maximise the amount of, repayment of any of the
Outstandings or (iii) to pay any other amount chargeable to that
Borrower pursuant to the terms of this Agreement, including without
limitation any costs, fees and expenses (any such Reference Rate
Revolving Loan described in this clause 6.15 being an "AGENT LOAN").
6.15.2 REVOCATION OF AUTHORISATION: The Lenders may at any time revoke the
Agent's authorisation contained in clause 6.15.1 to make Agent Loans,
any such revocation to be in writing and to become effective only upon
the Agent's actual receipt thereof.
6.15.3 REPAYMENT: Agent Loans shall constitute Reference Rate Revolving Loans
under this Agreement repayable by the relevant Borrower on demand and
shall bear interest at the rate per annum applicable to Reference Rate
Revolving Loans plus 2%. The Agent shall notify each Lender in writing
of each Agent Loan that it makes.
39
6.15.4 SETTLEMENT: It is agreed that each Lender shall participate in each
such Reference Rate Revolving Loan constituted by an Agent Loan in an
amount equal to its Participating Proportion of the amount of such
Reference Rate Revolving Loan. Notwithstanding such agreement, the
Agent and the Lenders agree (which agreement shall not be for the
benefit of or enforceable by the Borrowers) that in order to facilitate
the administration of this Agreement settlement of Agent Loans shall
take place on a periodic basis on such date or dates as the Agent may
specify by written notice to the Lenders. On receipt of any such
notice, each Lender shall make an amount equal to its Participating
Proportion of the outstanding principal amount of the Agent Loans in
respect of which settlement is requested available to the Agent in
immediately available funds to such account of the Agent as the Agent
may designate, not later than 2.00 pm on the proposed settlement date
(which shall be not less than three business days following the date of
such notice). If any such amount is not made available to the Agent by
any Lender on such settlement date, such Lender shall pay such amount
to the Agent on demand together with interest thereon from such
settlement date to the date of actual payment calculated at a rate per
annum which is the sum of (i) two per cent (2%) (ii) the Applicable
Margin and (iii) the Reference Rate.
6.16 PARTICIPATION AND NOTIFICATION
6.16.1 PARTICIPATION BY LENDERS: Each Lender will participate through its
Facility Office in each Utilisation hereunder, comprising the making of
the Revolving Loans, or in any amount to be reimbursed to the Swingline
Lender or the Issuer following any non-payment by any Borrower of any
amount due from it in respect of a Swingline Loan or, as appropriate, a
Letter of Credit or Guarantee, in the proportion which its Commitment
bears to the Total Commitments immediately prior to the making
available of that Utilisation or, as the case may be, at the time of
any such non-payment.
6.16.2 NOTIFICATION TO LENDERS: The Agent shall, promptly after receipt by it
of a Utilisation Notice, notify each Lender of the details of such
notice and of the amount of that Lender's share of the Utilisation to
be made available to the relevant Borrower.
7 INTEREST AND INTEREST PERIODS
7.1 DATES OF PAYMENT OF INTEREST
Each Revolving Loan shall bear interest on its unpaid principal amount
from the date made until paid in cash at a rate determined by reference
to the Reference Rate or to LIBOR, as applicable, and the relevant
Borrower shall pay accrued interest on each such Revolving Loan (i) in
the case of each Reference Rate Revolving Loan, on the first day of
each month thereafter and (ii) in the case of each LIBOR Revolving
Loan, on the last day of each Interest Period relating to such LIBOR
Revolving Loan.
7.2 RATE OF INTEREST
7.2.1 The rate of interest applicable to a LIBOR Revolving Loan from time to
time during an Interest Period relating to it shall be the rate per
annum which is the
40
sum of (i) the Applicable Margin at such time, (ii) LIBOR relating to
such LIBOR Revolving Loan for such Interest Period and (iii) the
Mandatory Cost, if any, applicable to that LIBOR Revolving Loan.
7.2.2 The rate of interest applicable to a Swingline Loan and each Reference
Rate Revolving Loan shall be a fluctuating rate per annum which is the
sum of the Reference Rate and the Applicable Margin. Each change in the
Reference Rate shall be reflected in such interest rate as of the
effective date of such change.
7.3 INTEREST PERIODS - LIBOR REVOLVING LOANS
Save as otherwise provided in this Agreement, the duration of each
Interest Period relating to a LIBOR Revolving Loan shall be the period
selected by the relevant Borrower in the Utilisation Notice relating to
that LIBOR Revolving Loan.
7.4 MAXIMUM NUMBER OF INTEREST PERIODS
A Borrower may not select an Interest Period in respect of any LIBOR
Revolving Loan of such a duration that there shall at any time be more
than five Interest Periods in existence at the same time.
7.5 CONVERSION AND CONTINUATION OF REVOLVING LOANS
7.5.1 Ideal (on behalf of the Borrowers) may, upon irrevocable written notice
to the Agent in accordance with clause 7.5.2:
(a) at any time after the Outstandings in respect of Reference
Revolving Rate Loans are equal to or exceed an amount equal to
an Original Sterling Amount of (pound)20,000,000 elect, as of
any business day, in the case of Reference Rate Revolving
Loans, to convert any such Reference Rate Revolving Loans (or
any part thereof) in an amount or integral multiple of not
less than (pound)1,000,000 into LIBOR Revolving Loans;
(b) elect, as of the last day of the applicable Interest Period,
to continue any LIBOR Revolving Loans having Interest Periods
expiring on such day (or any part thereof) in an amount or
integral multiple of not less than (pound)1,000,000.
7.5.2 If any Revolving Loans are to be converted into or continued as LIBOR
Revolving Loans, Ideal shall deliver a notice of conversion or
continuation (a "NOTICE OF CONVERSION/CONTINUATION") to be received by
the Agent not later than 11.00 a.m. at least 1 business day (in the
case of any Revolving Loan denominated in sterling) and at least 3
business days (in the case of any Revolving Loan denominated in a
Foreign Currency), in advance of the proposed date of conversion or
continuation specifying:
(a) the proposed date of such conversion or continuation;
(b) the aggregate amount of Revolving Loans to be converted or
continued; and
41
(c) the type of Revolving Loans resulting from the proposed
conversion or continuation.
7.5.3 If upon drawdown of any Revolving Loan or upon the expiry of any
Interest Period applicable to any LIBOR Revolving Loan, Ideal has
failed to select a new Interest Period to be applicable thereto or if
any Default or Event of Default then exists, Ideal shall be deemed to
have elected to convert such LIBOR Revolving Loan into a Reference Rate
Revolving Loan as of the expiry date of such Interest Period.
7.5.4 During the existence of a Default or an Event of Default, Ideal may not
elect to have a Revolving Loan converted into or continued as a LIBOR
Revolving Loan.
7.6 MARGIN RATCHET
7.6.1 If EBITDA to Cash Outflow exceeds a ratio of 1.00:1 for the Financial
Quarter ending 31 December 2003, the Applicable Margin shall, with
effect from 1st February 2004, be reduced to two and one quarter of one
per cent (2.25%) per annum. In addition, the Agent and the Lenders
agree with the Borrowers that the level of the Applicable Margin will
be reviewed by the Agent on the date upon which the Agent receives all
of the signed, audited, consolidated Financial Statements of every IHL
Group Company for the Financial Year ended 31 December 2004, required
to be delivered pursuant to clause 15.1 (such date being, the "REVIEW
DATE"). Each Borrower acknowledges and agrees that notwithstanding any
extension(s) of the Termination Date which may be agreed to pursuant to
clause 9.5, the Agent will not review the Applicable Margin and the
Applicable Margin may not be reduced on more than one occasion. The
Agent and the Lenders agree with Ideal and each other Borrower that,
provided that the conditions set out in clause 7.6.2 are satisfied on
the Review Date, the Applicable Margin shall be adjusted in accordance
with this clause 7.6 with effect from the date determined in accordance
with clause 7.6.5.
7.6.2 If on the Review Date, the Agent's review of the financial performance
of the IHL Group during the immediately preceding Financial Year
indicates that actual EBITDA achieved in such Financial Year exceeded
the projected EBITDA for such Financial Year (as set out in the
projections delivered to the Agent prior to the Effective Date) by an
amount equal to or greater than twenty per cent. (20%) of such
projected EBITDA, then the Applicable Margin shall be reduced by 0.125
per cent per annum.
7.6.3 For the avoidance of doubt, the original or most recently adjusted
Applicable Margin for the Revolving Facility shall continue to apply if
the condition set out in clause 7.6.2 is not met.
7.6.4 Any decrease of the Applicable Margin pursuant to this clause 7.6 shall
be determined by the Agent by reference to the signed, audited
Financial Statements for the relevant period delivered to the Agent
under clause 15.1.
42
7.6.5 Any adjustment of the Applicable Margin in accordance with clause 7.6.2
shall take effect in respect of any Reference Rate Revolving Loan,
LIBOR Revolving Loan or Swingline Loan, with effect from the Review
Date.
7.6.6 At any time while a Default has occurred and is continuing, the
original Applicable Margin for the Revolving Facility shall apply with
immediate effect, notwithstanding any previous reduction of such
Applicable Margin made pursuant to this clause 7.6 and no reduction
shall be instituted while a Default has occurred and is continuing.
8 MARKET DISRUPTION
8.1 CIRCUMSTANCES
If at or about 11.00 am on the Quotation Date for an Interest Period in
respect of any LIBOR Revolving Loan the Agent (in consultation with the
Lenders) determines it is not possible by reason of circumstances
affecting the London Interbank Market generally (i) to determine LIBOR
in accordance with its definition, or (ii) for the Lenders to obtain
requisite matching deposits in the required currency in the London
Interbank Market at the relevant time to fund their respective shares
during such Interest Period, or (iii) for the Majority Lenders to
obtain such deposits for such period at a cost less than or equal to
the rate offered to the Agent in accordance with the definition of
LIBOR, then the Agent shall forthwith notify Ideal and the Lenders and
notwithstanding the provisions of clause 7, the Interest Period in
respect of that LIBOR Revolving Loan and the amount of interest payable
in respect of that LIBOR Revolving Loan during its Interest Period
shall be determined in accordance with the following provisions of this
clause 8.
8.2 APPLICABLE INTEREST RATE
If clause 8.1 applies in relation to a LIBOR Revolving Loan the
duration of the Interest Period relating to that Loan shall be one
month or, if less, such that it shall end on the Termination Date and
the rate of interest applicable to that LIBOR Revolving Loan during its
Interest Period shall be the rate per annum which is the sum of (i) the
Applicable Margin, (ii) the Mandatory Cost, if any, and (iii) the rate
determined by the Agent (and notified to Ideal) to be that which
expresses as a percentage rate per annum the weighted average of the
cost to each of the Lenders of funding its share of such LIBOR
Revolving Loan during such Interest Period from whatever sources and in
whatever manner each such Lender may reasonably select.
8.3 REVIEW OF CIRCUMSTANCES
So long as any alternative basis for the calculation of interest as
provided in clause 8.2 is in force the Agent shall from time to time
review whether or not the circumstances referred to in clause 8.1 still
prevail with a view to returning to the normal provisions of this
Agreement relating to the determination of the rates of interest
applicable to any LIBOR Revolving Loan.
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8.4 DISTRIBUTION OF INTEREST
Interest on a LIBOR Revolving Loan during an Interest Period relating
to it calculated at the rates specified in clause 8.1 or 8.2 shall be
distributed by the Agent to the Lenders in proportion to the amounts
which represent the cost to each Lender of funding its share of such
LIBOR Revolving Loan during such Interest Period provided that any such
interest which is attributable to the Applicable Margin shall be
distributed by the Agent to the Lenders in proportion to their
respective shares in such LIBOR Revolving Loan.
9 REPAYMENT, PREPAYMENT AND CANCELLATION
9.1 REPAYMENT OF REVOLVING LOANS
Each Borrower shall repay each LIBOR Revolving Loan made to it,
together with accrued but unpaid interest thereon, on the last day of
the Interest Period applicable to that Loan. Each Borrower may repay
each Reference Rate Revolving Loan and each Swingline Loan made to it,
together with accrued but unpaid interest thereon, at any time. Each
Borrower shall, in any event, repay the outstanding principal balance
of all Revolving Loans made to it, plus all accrued but unpaid interest
thereon, upon the termination of this Agreement for any reason. In
addition, and without limiting the generality of each foregoing, each
Borrower shall pay to the Agent, on demand, the amount by which the
Original Sterling Amount of the unpaid principal balance of any
Revolving Loans and any Swingline Loans when aggregated with the
Original Sterling Amount of the maximum face amount of all Letters of
Credit and the maximum contingent liability under all Guarantees then
in issue (together "CONTINGENCY OUTSTANDINGS") at any time exceeds the
Available Facility in respect of the Revolving Facility or the
Available Revolving Facility Amount, the Available Facility and
Available Revolving Facility Amount being determined for this purpose
as if the amount of the Revolving Loans, Swingline Loans and
contingency outstandings were zero. Subject to the other terms of this
Agreement and to availability, Revolving Loans and Swingline Loans may
be reborrowed.
9.2 CANCELLATION OF TOTAL COMMITMENTS
Any Borrower may, by giving to the Agent not less than 30 business
days' prior notice to that effect, permanently cancel the whole (but
subject to clause 29) or any part (being a minimum amount of
(pound)5,000,000 and an integral multiple of (pound)1,000,000) of the
Total Commitments, provided that both on the date of such notice and
upon the effective date of cancellation, the amount to be so cancelled
does not exceed an amount equal to the difference between the Maximum
Revolving Credit Line and the Total Outstandings and the Agent has not,
pursuant to clause 6.7, permitted the limits of the Available Revolving
Facility Amount to have been exceeded. Any such cancellation shall
reduce the Commitment of each Lender pro rata. If a Borrower cancels
any part (but not the whole) of the Total Commitments, Ideal shall (or
shall procure that such other Borrower shall) pay to the Agent (for the
rateable benefit of the Lenders), on or prior to the date of such
cancellation:
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9.2.1 2% of the amount of the Total Commitments so cancelled, if
such cancellation is made on or prior to the first Anniversary
Date;
9.2.2 1% of the amount of the Total Commitments so cancelled, if
such cancellation is made on or prior to the second
Anniversary Date; and
9.2.3 0.5% of the amount of the Total Commitments so cancelled, if
such cancellation is made at any time after the second
Anniversary Date.
9.3 PREPAYMENT AND CANCELLATION OF INDIVIDUAL LENDERS
If a Borrower becomes obliged to pay an increased amount pursuant to
clauses 10.1 or 11.1 or any Lender claims indemnification from Ideal
under clause 10.2 or clause 11.1 and the Agent receives from Ideal at
least fifteen days' prior notice of the intention of the Borrowers to
prepay such Lender's Outstandings, such Lender shall, upon receipt by
the Agent of such notice, cease to be obliged to participate in any
further Loans, its Commitment shall be permanently cancelled and
reduced to zero and the each Borrower shall on the last day of each of
the then current Interest Periods or earlier, if the Agent or such
Lender so requires, prepay such Lender's portion of the Loan to which
such Interest Period relates together with any applicable break costs
payable under clause 19.2 but otherwise without premium or penalty.
9.4 NOTICES IRREVOCABLE
Any notice of cancellation or prepayment given by a Borrower (or Ideal
on its behalf) pursuant to clause 9.2 or clause 9.3 shall be
irrevocable, shall specify the date upon which such prepayment is to be
made and the amount of such prepayment and shall oblige that Borrower
to make such prepayment on such date. A Borrower shall not be entitled
to reborrow any amount so prepaid.
9.5 EXTENSION OF TERMINATION DATE
9.5.1 Not earlier than 90 but not later than 60 days prior to the second
Anniversary Date (and if the Termination Date is extended in accordance
with this clause 9.5, prior to any subsequent Anniversary Date), Ideal
may deliver a request to the Agent (which the Agent shall promptly
forward to the Lenders), requesting that the Lenders shall extend the
maturity of the Revolving Facility for a further period of twelve (12)
months from the then applicable Termination Date (as the same may be
extended from time to time under this clause 9.5).
9.5.2 The decision whether or not to extend the Termination Date shall be in
the absolute discretion of the Agent to determine (acting on the
instructions of all of the Lenders) and shall be based upon such
factors as the Agent may deem relevant (including, without limitation,
the business condition (financial or otherwise) of the Group at the
relevant time and after reviewing such forecasts, projections and
financial and other information regarding the Borrowers and the Group
as the Agent may require. The Borrowers
45
acknowledge that the Agent and the Lenders shall not be under any
obligation to extend the Termination Date.
9.5.3 If extended pursuant to this clause 9.5, references to the "TERMINATION
DATE" in this Agreement and the other Finance Documents shall be
construed as a reference to the Termination Date as from time to time
extended.
10 TAXES
10.1 REQUIREMENT TO GROSS-UP
All payments to be made by any of the Obligors to any person under this
Agreement shall be made free and clear of and without deduction for or
on account of tax unless such Obligor is required by law to make such a
payment subject to the deduction or withholding of tax, in which case
the sum payable by such Obligor in respect of which such deduction or
withholding is required to be made shall be increased to the extent
necessary to ensure that, after the making of such deduction or
withholding (including any deduction or withholding applicable to
additional sums payable under this clause), such person receives and
retains (free from any liability in respect of any such deduction or
withholding) a net sum equal to the sum which it would have received
and so retained had no such deduction or withholding been made or been
required to be made.
10.2 INDEMNITY
Without prejudice to the provisions of clause 10.1, if any person or
the Agent is required to make any payment on account of tax (other than
tax on its overall net income) on or calculated by reference to the
amount of any Loan made or to be made under this Agreement or by
reference to any Letter of Credit or Guarantee issued under this
Agreement and/or by reference to any sum received or receivable under
this Agreement by such person or the Agent on its behalf (including,
without limitation, any sum received or receivable under this clause
10) or any liability in respect of any such payment is asserted,
imposed, levied or assessed against such person or the Agent on its
behalf, the relevant Obligor shall, upon demand of the Agent, promptly
indemnify such person against such payment or liability, together with
any interest, penalties and expenses payable or incurred in connection
therewith provided that the foregoing shall not apply to the extent
that the payment or liability (a) is compensated for by an increased
payment under clause 10.1 or (b) would have been so compensated but was
not so compensated, solely because one of the exclusions in clause 10.6
applied.
10.3 NOTIFICATION
A Lender intending to make a claim pursuant to clause 10.2 shall notify
the Agent of the event by reason of which it is entitled to do so
whereupon the Agent shall notify the relevant Obligor.
46
10.4 TAX RECEIPTS
Without prejudice to the provisions of clause 10.1, if any Obligor
makes any payment under this Agreement in respect of which it is
required by law to make any deduction or withholding it shall pay the
full amount to be deducted or withheld to the relevant taxation or
other authority within the time allowed for such payment under
applicable law and shall deliver to the Agent (no later than one week
after the end of the time allowed for such payment under applicable
law) an original receipt or other appropriate evidence issued by such
authority evidencing the payment to such authority of all amounts so
required to be deducted or withheld from such payment.
10.5 TAX CREDITS
If any Obligor makes an increased payment under clause 10.1 for the
account of any person and such person in its sole opinion and based on
its own interpretation of any relevant laws or regulations (but acting
in good faith) determines that it has received or been granted a credit
against or relief or remission for or in respect of any tax paid or
payable by it in respect of or calculated by reference to the deduction
or withholding giving rise to such payment, such person shall, to the
extent that it determines that it can do so without prejudice to the
retention of the amount of such credit, relief, remission or payment
and, to the extent it is reasonably identifiable and quantifiable, as
soon as practicable pay to such Obligor an amount equal to such part or
all of such credit, relief, remission or repayment as can be made
available to such Obligor in such a way as to leave such person (after
such payment) in no better or worse position than it would have been in
if such Obligor had not been required to make such deduction or
withholding. Nothing contained in this clause 10.5 shall interfere with
the right of a person to arrange its tax affairs in whatever manner it
thinks fit nor oblige any person to disclose any information relation
to its tax affairs or any computation in respect thereof.
10.6 LIMITATION ON REQUIREMENT TO GROSS-UP
10.6.1 If any Lender ceases to be a Qualifying Lender, no Obligor shall be
liable to pay to such Lender under clause 10.1 any amount in excess of
the amount it would have been obliged to pay if such Lender had not
ceased to be a Qualifying Lender provided that this clause 10.6 shall
not apply and each Obligor shall continue to be obliged to comply with
its obligations under clause 10 if and to the extent that after the
date of this Agreement there shall have been any change in, or in the
interpretation, administration or application of, any relevant law or
double taxation treaty or any published practice or concession of any
relevant taxing authority and as a result of such change (i) such
Lender ceases to be a Qualifying Lender or (ii) such Obligor would be
required to make a deduction or withholding on account of tax
irrespective of whether the recipient of the relevant payment was or
was not a Qualifying Lender.
10.6.2 No Obligor shall be liable to make a payment to a Lender under Clause
10.1 if on the date on which the payment falls due the relevant Obligor
is able to show that the payment could have been made to such Lender
without any
47
deduction or withholding had such Lender complied with its obligations
under clause 10.7.
10.7 DOUBLE TAXATION RELIEF
If, and to the extent that, the effect of clause 10.1 or 10.2 can be
mitigated by virtue of the provisions of any applicable double tax
treaty entered into by the United Kingdom (whether by a claim to
repayment of any taxes referred to in clause 10.1 or 10.2 or otherwise)
each Lender agrees to co-operate (to the extent reasonably required)
with affected Obligor(s) with a view to submitting any forms required
for the purpose of ensuring the application of such double tax treaty
so far as relevant, provided that no Lender shall be required pursuant
to this clause 10.7 to complete or co-operate in completing any form
which is not substantially similar to any form in use at the date of
this Agreement for the purpose of claiming exemption or relief from or
repayment of taxes envisaged hereunder pursuant to a double taxation
treaty between the United Kingdom and such Lender's jurisdiction of
residence and which requires the Lender to undertake obligations which,
in its reasonable opinion, are more onerous than those imposed upon it
as at the date of this Agreement.
11 INCREASED COSTS
11.1 INCREASED COSTS AND REDUCTION OF RETURN
If the Agent or, as the case may be, any Lender, in its sole discretion
determines that, as a result of (i) the introduction of, or any change
in any law or in any treaty, directive or regulation (whether or not
having the force of law but if not having the force of law, only if
such treaty, directive or regulation is generally applicable to banks
and of the type with which the relevant Lender is accustomed to comply)
or the interpretation or application thereof, in each case after the
date hereof, or (ii) compliance with any request from or requirement
(whether or not having the force of law but if not having the force of
law, only if such request or requirement is generally applicable to
banks and of the type with which the relevant Lender is accustomed to
comply) of any central bank or other fiscal, monetary or other
authority made or imposed after the date hereof:
11.1.1 it incurs a cost in assuming or maintaining all or any part of
any Commitment under this Agreement and/or in making,
maintaining or funding all or any part of its Outstandings or
any unpaid sum and/or assuming or maintaining a contingent
liability under or pursuant to this Agreement (whether under
any Letter of Credit or Guarantee or otherwise), or that cost
is increased; or
11.1.2 any sum received or receivable by it under this Agreement or
the effective return to it under this Agreement is reduced; or
11.1.3 it suffers a reduction in the rate of return on its overall
capital below that which might reasonably have been
anticipated at the date of this Agreement and which it would
have been able to achieve but for having entered into and/or
performing its
48
obligations and/or assuming or maintaining a commitment or
contingent liability under or pursuant to this Agreement; or
11.1.4 it makes any payment or forgoes any interest or other return
on or calculated by reference to the amount of any sum
received or receivable by it under or pursuant to this
Agreement; or
11.1.5 it incurs a cost or increased cost, or suffers a reduction in
any amount payable to it or in the effective return on its
capital, or forgoes any interest or any other return as a
result of the introduction of, changeover to or operation of
the euro in the United Kingdom,
and in any such case, the same is attributable to its liabilities or
obligations under this Agreement, then the person concerned shall
notify the Agent of the relevant event (setting out in reasonable
detail the basis on which its claim has been computed) promptly upon
its becoming aware of the same, whereupon the Agent shall notify Ideal
and, upon demand of the Agent, Ideal shall pay, or shall procure that
there is paid, on demand to the Agent for the account of the person
concerned an amount sufficient to indemnify that person against the
relevant cost, increased cost, reduction, reduction in the rate of
return, payment or forgone interest or other return or such proportion
thereof as is, in the opinion of such person, attributable to its
obligations under or pursuant to this Agreement.
11.2 CAPITAL ADEQUACY
If the Agent, or as the case may be, any Lender, in its sole discretion
determines that (i) the introduction of, or any change in, any capital
adequacy regulation or in the interpretation or application thereof, in
each case after the date hereof, or (ii) compliance by such person or
any corporation controlling it with any capital adequacy regulation,
affects or would affect the amount of capital, reserves or special
deposits required or expected to be maintained by such person or any
corporation controlling it and (taking into consideration such person's
or such corporation's policies with respect to capital adequacy)
determines that the amount of such capital, reserves or special
deposits is increased as a consequence of its loans, contingent
liabilities or obligations under this Agreement then, upon demand of
the Agent (having been so notified by such person) to Ideal, Ideal
shall pay, or shall procure that there is paid, to the Agent for the
account of the person concerned, from time to time as specified by the
Agent, additional amounts sufficient to compensate such person for such
increase.
11.3 EXCEPTIONS
Clauses 11.1 and 11.2 do not apply to any cost, increased cost,
reduction, reduction in the rate of return, payment or forgone interest
or other return compensated for by (a) payment of the Mandatory Cost,
(b) by the operation of clause 10, (c) by a change in the rate of tax
on the overall net income of the Agent or any Lender or (d) which is
attributable to the wilful breach by the relevant Lender or any of its
Affiliates of any law or regulation.
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12 ILLEGALITY
12.1 CONSEQUENCES OF ILLEGALITY
If at any time it is unlawful, or contrary to any directive or request
of any applicable central bank or other fiscal, monetary or other
authority, or impossible for a Lender to make, fund or allow to remain
outstanding any Loan made or to be made under this Agreement or to
assume or remain under any obligations hereunder in relation to or
under any Letter of Credit or Guarantee, then the Agent shall, promptly
after becoming aware of the same, deliver to Ideal a certificate to
that effect and:
12.1.1 such Lender shall not thereafter be obliged to make or
participate in any Loan under this Agreement or (in the case
of the Issuer) issue any Letter of Credit or Guarantee and its
Commitment shall immediately be cancelled and reduced to zero;
and
12.1.2 if the Agent on behalf of such Lender so requires, each
Borrower shall on the last day of the Interest Period for each
such Loan occurring after the Agent has notified Ideal or (if
earlier) on such date as the Agent shall have specified (being
no earlier than the last day upon which the Lender is legally
able to permit such Loans to remain outstanding) repay such
Lender's Outstandings together with accrued interest thereon
(any such repayment to be without premium or penalty or the
payment of any amount to be calculated in accordance with
clause 29.2.3) and all other amounts owing to such Lender
under this Agreement, and, with respect to any Letter of
Credit or Guarantee then outstanding, deposit with the
Security Trustee for the benefit of the Issuer a Supporting
Letter of Credit or cash, in either such case in the same
manner as contemplated in clause 6.14.
12.2 MITIGATION OF ADVERSE CIRCUMSTANCES
If, in respect of any Lender, circumstances arise which would, or would
upon the giving of notice, result in additional amounts becoming
payable under clause 10 or clause 11.1 or result in a cancellation of
its Commitment pursuant to clause 12.1.1 then, without in any way
limiting, reducing or otherwise qualifying the obligations of any
Borrower hereunder such Lender will, at the request of Ideal, consider
means of mitigating the effects of such circumstances provided that
such Lender shall be under no obligation to take any such action if to
do so would or might in its opinion have an adverse effect on its
business, operations or financial condition.
13 GUARANTEE
13.1 GUARANTEE
Each Unsecured Guarantor, jointly and severally, unconditionally and
irrevocably guarantees to the Beneficiaries the due and punctual
payment, performance and discharge by the Obligors of all the monies,
obligations and liabilities (whether present or future, actual or
contingent) on the part of the
50
Obligors to be paid, performed or discharged, whether directly or
indirectly, under or pursuant to the terms of this Agreement and/or in
connection with the Facility and/or otherwise under the Finance
Documents (together in this clause 13 the "GUARANTEED OBLIGATIONS"). If
and whenever any Obligor shall default in the payment, discharge or
performance of any of the guaranteed obligations, each Unsecured
Guarantor shall, upon written demand by the Agent, promptly pay,
perform or discharge the guaranteed obligations in respect of which
such default has been made.
13.2 INDEMNITY
Each Unsecured Guarantor agrees to indemnify and hold harmless the
Beneficiaries from time to time on demand for and against any loss
incurred by any of them as a result of any of the guaranteed
obligations being or becoming void, voidable or unenforceable for any
reason whatsoever, whether known to such person or persons or not. The
amount of such loss shall be the amount which the person or persons
suffering it would otherwise have been entitled to recover from the
Obligors.
13.3 CONTINUING SECURITY
The obligations of each Unsecured Guarantor under this Agreement are
continuing obligations and shall remain in force until all of the
guaranteed obligations have been satisfied in full. The obligations of
each Unsecured Guarantor under this Agreement shall not be (or be
construed so as to be) discharged by any intermediate discharge or
payment of or on account of any of the guaranteed obligations or any
settlement of account or any other matter (other than the discharge in
full of the guaranteed obligations).
13.4 PROTECTIVE PROVISIONS
Neither the obligations of each Unsecured Guarantor nor the rights and
remedies of the Beneficiaries under this Agreement, any other Finance
Document or otherwise conferred by law shall be discharged, prejudiced
or impaired by reason of:
13.4.1 any variation of any of the guaranteed obligations or of the
terms of conditions of this Agreement, any other Finance
Document or of any encumbrance, guarantee or other assurance
held or to be held as security for the payment, performance or
discharge of the guaranteed obligations (any such encumbrance,
guarantee or other assurance together referred to in this
clause 13 as "RELATED SECURITY");
13.4.2 any failure (whether intentional or not) to take, perfect or
realise (whether in full or in part) any related security now
or in the future agreed to be taken in respect of any of the
guaranteed obligations;
13.4.3 any capacity or change in the constitution of any party to
this Agreement, any other Finance Document or to any related
security;
51
13.4.4 any of the guaranteed obligations or any obligation of any
person under any related security being or becoming invalid,
illegal, void or unenforceable for any reason;
13.4.5 any time or other indulgence given or agreed to be given to,
or any composition or other arrangement made with or accepted
from, any Obligor in respect of any of the guaranteed
obligations or any other person in respect of any of its
obligations under any related security;
13.4.6 any waiver or release of any of the guaranteed obligations or
of any obligation of any person under any related security or
any failure to realise, in full or in part, the value of, or
any discharge or exchange of any related security;
13.4.7 any Obligor or any other person party to this Agreement, any
other Finance Document or any related security being wound up,
going into administration or liquidation or making any
composition or arrangement with its creditors (whether or not
sanctioned by the court and whether or not the Agent has
agreed to such compromise or arrangement) and so that where,
by virtue of any compromise or arrangement, any of the
guaranteed obligations are transferred to any other person,
the guarantee and indemnity of each Unsecured Guarantor
contained in this Agreement shall take effect as if the
expression "Obligor" included such other person; or
13.4.8 any other act, event or omission which, but for this
provision, would or might operate to offer any legal or
equitable defence for or impair or discharge any of the
guaranteed obligations or any obligation of any person under
any related security or prejudicially affect the rights or
remedies of the Beneficiaries or any of them under this
Agreement, any other Finance Document or otherwise conferred
by law.
13.5 INDEPENDENT OBLIGATIONS
The obligations of each Unsecured Guarantor under this Agreement are
additional to, and not in substitution for, any related security and
the obligations assumed by each Unsecured Guarantor under this
Agreement may be enforced without first having recourse to any related
security and without making or filing any claim or proof in a
winding-up or dissolution of any Obligor or any other person party to
this Agreement or any related security or first taking any steps or
proceedings against any Obligor or any such person.
13.6 NON-COMPETITION
Until all of the guaranteed obligations have been satisfied in full, no
Unsecured Guarantor shall:
13.6.1 exercise any right of subrogation, indemnity, set-off or
counterclaim against any Obligor, any other Unsecured
Guarantor or any person party to any related security;
52
13.6.2 claim payment of any other monies for the time being due to it
by any Obligor, any other Unsecured Guarantor or any person
party to any related security by reason of the performance by
it of its obligations under this Agreement or on any account
whatsoever or exercise any other right or remedy or enforce
any encumbrance, guarantee or other assurance which it has in
respect thereof;
13.6.3 claim any contribution from any other Unsecured Guarantor or
any person party to any related security;
13.6.4 negotiate, assign, charge or otherwise dispose of any monies,
obligations or liabilities now or at any future time due or
owing to it by any Obligor or any other Unsecured Guarantor or
any person party to any related security or any encumbrance,
guarantee or other assurance in respect thereof; or
13.6.5 claim or prove in a winding up or dissolution of the Obligor
or any other Unsecured Guarantor in competition with the
Beneficiaries or any of them; and
13.6.6 if any Unsecured Guarantor receives any sums in contravention
of this clause 13.6, it shall hold them on trust to be applied
promptly in or towards the satisfaction of its obligations
under this Agreement.
13.7 WARRANTY
Each Unsecured Guarantor warrants that it has not taken, and agrees
that (without the prior written consent of the Agent acting on the
instructions of the Majority Lenders) it will not take, from any
Obligor, any other Unsecured Guarantor or any person party to any
related security any encumbrance, guarantee or other assurance in
respect of or in connection with its obligations under this Agreement.
If any Unsecured Guarantor takes any such encumbrance, guarantee or
other assurance in contravention of this clause 13.7, it shall hold the
same on trust for the Beneficiaries until such time as all of the
guaranteed obligations have been satisfied in full and shall on request
promptly deposit the same with and/or charge the same to the Agent for
and on behalf of itself and such persons in such manner as the Agent
may require as security for the due performance and discharge by the
relevant Unsecured Guarantor of the guaranteed obligations
13.8 SUSPENSE ACCOUNT
If any Obligor or any of the Unsecured Guarantors is wound up, goes
into liquidation or makes any composition or arrangement with its
creditors, neither the existence of the guarantee of the relevant
Unsecured Guarantor contained in this Agreement nor any monies received
or recovered by the Beneficiaries or any of them under to pursuant to
this Agreement shall impair the right of such persons to prove in such
winding-up, liquidation, composition, or arrangement for the total
amount due from the Obligor or the relevant Unsecured Guarantor. The
Agent may at any time and from time to
53
time place and, for so long as it thinks fit, keep any monies received
or recovered under this Agreement in a separate or suspense account, in
such name as it thinks fit, without any intermediate obligation on its
part to apply the same in or towards discharge of any part of such
total amount, provided that if the monies are at any time sufficient to
discharge the guaranteed obligations in full, they shall promptly be so
applied.
13.9 CONDITIONAL DISCHARGE
Any settlement or discharge between any of the Unsecured Guarantors and
the Arranger, the Agent, the Lenders or any of them shall be
conditional upon no security or payment to the Arranger, the Agent and
the Lenders or any of them by any Obligor or the relevant Unsecured
Guarantor or any other person being avoided or set aside or ordered to
be refunded or reduced by or pursuant to any applicable law or
regulation and, if such condition is not satisfied, the Arranger, the
Agent and the Lenders shall each be entitled to recover from the
relevant Unsecured Guarantor on demand the value of any such security
or the amount of any such payment as if such settlement or discharge
had not occurred.
14 REPRESENTATIONS AND WARRANTIES
14.1 GENERAL REPRESENTATIONS AND WARRANTIES
Each Obligor represents and warrants (in respect of itself and each
other Obligor) to and for the benefit of each other party to this
Agreement that, except as disclosed to and accepted by the Agent in
writing:
14.1.1 STATUS: (other than in the case of BMEP) it is a limited
liability company duly incorporated or a corporation duly
organised and validly existing under the laws of its
jurisdiction of incorporation and BMEP is a partnership
properly established and validly existing under the laws of
the Netherlands, in each case having the power and authority
to own its assets and to conduct the business and operations
which it conducts or proposes to conduct;
14.1.2 POWERS AND AUTHORITY: it has full power and authority to enter
into and perform each of the Relevant Agreements to which it
is or will be a party and any other document to be entered
into by it pursuant thereto and has taken all necessary
corporate or other action to authorise the execution, delivery
and performance of each such Relevant Agreement and each such
other document;
14.1.3 AUTHORISATIONS: save for any necessary registrations which
will be made within the applicable registration period, all
actions, conditions and things required by all applicable laws
and regulations to be taken, fulfilled, obtained or done in
order (i) to enable it lawfully to enter into, exercise its
rights under and perform and comply with its obligations under
each of the Relevant Agreements to which it is or will be a
party and any other document to be entered into pursuant
thereto (ii) to ensure that those obligations are valid,
legally binding and enforceable in
54
accordance with their respective terms and (iii) to make each
of the Relevant Agreements and all such other documents
admissible in evidence in England and Wales and, if different,
its jurisdiction of incorporation have been taken, fulfilled,
obtained or done;
14.1.4 NON-VIOLATION: the execution by it of and the exercise by it
of its rights and performance of or compliance with its
obligations under each of the Relevant Agreements to which it
is or will be a party do not and will not violate (i) any law
or regulation to which it or any of its assets is subject or
(ii), to an extent or in a manner which has or could have a
material adverse effect on it, any agreement to which it is a
party or which is binding on it or its assets or conflict with
its constitutional documents and in particular will not cause
any limit on its borrowing or other powers or the exercise of
such powers by its board of directors to be exceeded;
14.1.5 OBLIGATIONS BINDING: subject to the Reservations, its
obligations under each of the Relevant Agreements are legal,
valid and binding and enforceable in accordance with their
respective terms;
14.1.6 LITIGATION: save as disclosed in writing to and agreed by the
Agent prior to the date of this Agreement, it is not involved
or engaged in any litigation, arbitration or administrative
proceedings (whether as plaintiff or defendant) nor, to the
best of its knowledge is any such litigation, arbitration or
administrative proceedings threatened, nor are there any
circumstances likely to give rise to any such litigation,
arbitration or proceedings which in any such case may have a
material adverse effect on it, any other Obligor or on the
Group (taken as a whole);
14.1.7 NO DEFAULT: it is not in breach of or default under any
agreement or arrangement (including, without limitation, under
any Relevant Agreement) or any statutory or legal requirement
to an extent or in a manner which has or could have a material
adverse effect on it or on any other Obligor and no Event of
Default has occurred and is continuing;
14.1.8 EXISTING ENCUMBRANCES: no encumbrance exists over its present
or future assets except for Permitted Encumbrances;
14.1.9 FUTURE ENCUMBRANCES: the execution by it of each of the
Relevant Agreements to which it is or will be a party and the
exercise by it of its rights and performance of or compliance
with its obligations thereunder will not result in the
existence of or oblige it to create any encumbrance over all
or any of its present or future assets except for Permitted
Encumbrances;
14.1.10 FINANCIAL STATEMENTS:
(a) its audited consolidated Financial Statements were
prepared in accordance with Applicable GAAP and give
a true
55
and fair view of the financial condition of the Group
at the date as of which they were prepared and the
results of the Group's business and operations during
the Financial Year then ended and (in the case of its
Financial Statements) disclose or reserve against all
liabilities (contingent or otherwise) of each Group
Company as at that date and all unrealised or
anticipated losses from any commitment entered into
by each Group Company and which existed on that date;
(b) the Latest Projections represent its best estimate of
the Group's future financial performance for the
periods referred to in them and have been prepared on
the basis of the stated assumptions, which it
believes are fair and reasonable in the light of
current and reasonably foreseeable business
conditions;
(c) the Ideal Pro Forma Balance Sheet presents fairly and
accurately the financial condition of the IHL Group
as at such date, and has been prepared in accordance
with Applicable GAAP;
14.1.11 CAPITALISATION: the Adjusted Tangible Net Worth of Ideal is
not less than (pound)30,233,507, BMEBV's authorised share
capital consists of EUR90,000 of which 200 shares of EUR100
are validly issued and fully paid and are owned beneficially
by BMEP and Ideal's authorised share capital consists of
6,000,000 shares of (pound)1 per share, of which 4,000,000
shares are validly issued and fully paid and are beneficially
owned by BMEBV;
14.1.12 INDEBTEDNESS: no Group Company has any indebtedness except for
Permitted Indebtedness;
14.1.13 DISTRIBUTIONS: since 1 January 2002 no Distribution has been
declared, paid, or made upon or in respect of any shares or
other securities of any Group Company other than in accordance
with the provisions of clause 16.3.3;
14.1.14 TITLE TO ASSETS: except for assets which are leased, it is the
beneficial owner free from all encumbrances (other than
Permitted Encumbrances) of all its other assets including,
without limitation, the assets reflected on the most recent
Financial Statements delivered to the Agent, except as
disposed of since the date thereof in the ordinary course of
trading;
14.1.15 LABOUR DISPUTES: there is no pending or, to the best of its
knowledge, threatened strike, work stoppage, material unfair
labour practice claim, or other material labour dispute
against or affecting its or its employees;
56
14.1.16 ENVIRONMENTAL LAWS: to the best of its knowledge and belief
(having made all due and reasonable enquiry) it has not
breached any Environmental Law and no condition exists or act
or event has occurred which will or might reasonably be
expected to give rise to any breach of, or any liability of
any kind under, any Environmental Law;
14.1.17 ENVIRONMENTAL AUTHORISATIONS: to the best of its knowledge and
belief (having made all due and reasonable enquiry) it is in
possession of all Environmental Authorisations required for
the conduct of its business or operations (or any part
thereof) and it has not breached any of the terms or
conditions of any such Environmental Authorisation;
14.1.18 NOTICES OF ENVIRONMENTAL BREACHES: (i) it has not received any
summons, complaint, order or similar written notice that it is
not in compliance with, or any public authority is
investigating its compliance with, any Environmental Law or
that it is or may be liable to any other person as a result of
a potential or actual Discharge of a Hazardous Substance and
(ii) none of its present or past operations is the subject of
any investigation by any public authority evaluating whether
any remedial action is needed to respond to a potential or
actual Discharge of a Hazardous Substance;
14.1.19 NO DEPOSIT OF HAZARDOUS SUBSTANCES: to the best of its
knowledge and belief (having made all due and reasonable
enquiry) no Hazardous Substance has at any time been used,
disposed of, generated, stored, transported, dumped, released,
deposited, buried, discharged or emitted at, on, from or under
any premises owned, leased, occupied or controlled by it;
14.1.20 LIABILITY FOR ENVIRONMENTAL CLAIMS: it has not entered into
any negotiations or settlement agreements with any person
(including, without limitation, any prior owner of its
property) imposing material obligations or liabilities on it
with respect to any remedial action in response to the
potential or actual Discharge of a Hazardous Substance or
environmentally related claim;
14.1.21 TAXES: it has filed all tax returns and other reports required
to be filed and has paid all taxes imposed on it or upon any
of its assets that are due and payable (save for any that are
being contested in good faith and by appropriate action and in
respect of which it has provided or maintained adequate
reserves to meet any such liability);
14.1.22 MATERIAL ADVERSE CHANGE: there has been no material adverse
change in its financial condition or the financial condition
of the Group (taken as a whole) since the date of the
Pro-Forma Balance Sheet nor in the consolidated financial
condition, business, assets or operations of the Group nor in
the Collateral since that date which will nor might reasonably
be expected to result in a material adverse effect;
57
14.1.23 INFORMATION: all factual information delivered by it or on its
behalf to the Agent in connection with the business,
operations and assets of the Group or in connection with any
of the Relevant Agreements from time to time was, in each such
case at the date of its delivery, true and correct in all
material respects and not misleading and all expressions of
opinion, forecasts and projections have been arrived at in
good faith and have been based upon reasonable grounds;
14.1.24 INFORMATION MEMORANDUM: (a) all statements of fact contained
in the Information Memorandum relating to the Group are, or
will be, true in all respects material to the Revolving
Facility, (b) all expressions of opinion or expectations and
all forecasts and projections provided in the Information
Memorandum, have been, or will be, arrived at in good faith
and have been, or will be, based upon reasonable grounds (in
each case as at the date at which they are, or will be, made
or expressed to be made and in final form), and (c) it is not
aware, having made all due and reasonable enquiry, of any
facts or circumstances that have not been disclosed to the
Agent, the Arranger and the Lenders which would, if disclosed,
be reasonably likely to affect the decision of a person
considering whether or not to provide finance to the
Borrowers;
14.1.25 DEDUCTIONS AND WITHHOLDINGS: it is not required to make any
deduction or withholding from any payment it may make under
this Agreement;
14.1.26 WINDING-UP: neither it nor any other Group Company has taken
any corporate action nor have any other steps been taken or
legal proceedings been started or (to the best of its
knowledge and belief) threatened against it or any Group
Company for its winding-up, dissolution or re-organisation
(other than for the purposes of a bona fide solvent scheme of
reconstruction or amalgamation previously approved in writing
by the Agent) or for the appointment of a receiver,
administrator, administrative receiver, trustee or similar
officer of it or of any or all of its assets.
14.2 ACCOUNTS
Each Obligor represents and warrants to and for the benefit of each
other party to this Agreement that, except as disclosed to and accepted
by the Agent in writing:
14.2.1 ACCOUNTS:
(a) each existing Account represents, and each future Account will
represent, a bona fide sale or lease and delivery of goods by
a Trading Company, or the rendering of services by a Trading
Company, in the ordinary course of such Trading Company's
business;
58
(b) each existing Account is, and each future Account will be, for
a liquidated amount payable by the Account Debtor thereon on
the terms set forth in the invoice therefor or in the schedule
thereof delivered to the Agent, without set-off, deduction,
defence, or counterclaim;
(c) no payment will be received with respect to any Account, and
no credit, discount, or extension, or agreement therefor will
be granted on any Account, except as reported to the Agent in
accordance with this Agreement;
(d) each copy of an invoice delivered to the Agent will be a
genuine copy of the original invoice sent to the Account
Debtor named in it; and
(e) all goods described in any invoice representing a sale of
goods will have been delivered to the Account Debtor and all
services of any Trading Company described in any invoice will
have been performed;
14.2.2 INVENTORY: with effect from any Inventory Eligibility Date, in relation
to each Trading Company, all of its Inventory is and will be held for
sale or lease, or to be furnished in connection with the rendering of
services in the ordinary course of its business and is and will be fit
for such purpose and will be kept by it, at its own expense, in good
and marketable condition (save for damaged or obsolete items as
notified to and agreed by the Agent).
14.3 REPETITION
Each of the representations and warranties in clauses 14.1 and 14.2
will be correct and complied with on the date of this Agreement and the
Effective Date and (other than the representations in clauses
14.1.10(c), 14.1.13, 14.1.24 and 14.1.25) will also be correct and
complied with on each date on which a Loan is requested or to be made
(or, as the case may be, a Letter of Credit or Guarantee is issued or
requested to be issued) as if repeated then by reference to the then
existing circumstances.
15 FINANCIAL CONDITION
15.1 BOOKS AND RECORDS
15.1.1 MAINTENANCE: BMEP shall maintain, and shall procure that each Group
Company shall maintain, at all times, books, records and accounts which
are complete and correct in all material respects and in relation to
which timely entries are made of their transactions in accordance with
Applicable GAAP. BMEP shall, and shall procure that each Group Company
shall, by means of appropriate entries, reflect in such accounts and in
all Financial Statements proper liabilities and reserves for all taxes
and proper provision for depreciation and amortisation of any property
or asset and bad debts, all in accordance with Applicable GAAP. BMEP
shall, and shall procure that each Group Company shall, maintain at all
times books and records pertaining to any applicable Collateral in such
detail, form and scope as the Agent shall
59
reasonably require, including without limitation records of (i) all
payments received and all credits and extensions granted with respect
to the Accounts; (ii) the return, rejection, repossession, stoppage in
transit, loss, damage or destruction of any Inventory; and (iii) all
other dealings affecting the Collateral.
15.1.3 ACCESS: BMEP and/or, as applicable, Ideal shall, upon receiving not
less than two business days' notice from the Agent (or without notice
following a Default which is continuing), permit and procure that each
Group Company permits the Agent or any person authorised by the Agent
at any reasonable time to have access to its premises and books,
records and accounts and to make extracts from and take copies of such
books, records and accounts.
15.2 PROVISION OF FINANCIAL INFORMATION
BMEP, BMEBV, BMEE and Ideal shall each deliver to the Agent in
sufficient copies for each of the Lenders:
15.2.1 FINANCIAL STATEMENTS: as soon as the same become available,
but in any event within 120 days after the end of each
Financial Year, the audited consolidated Financial Statements
of the Group for such Financial Year together with the audited
statutory accounts of each Group Company for such Financial
Year and to the extent that any Financial Statements have been
prepared in accordance with or otherwise converted to or
conformed with US GAAP, such Financial Statements shall be
accompanied by a note or similar document prepared by the
Auditors (or prepared by the Parent and signed by the
Auditors) which (a) reconciles the Financial Statements to the
Management Accounts delivered for the relevant Financial Year
pursuant to clause 15.2.2 and (b) explains, in reasonable
detail, any changes or adjustments made to the figures
contained in such Management Accounts, to comply with US GAAP;
15.2.2 MANAGEMENT ACCOUNTS: as soon as the same become available, but
in any event within 25 days of the end of each Management
Accounting Period, its Management Accounts (incorporating,
without limitation, roll forward of 90 day weekly cashflow
forecasts showing Excess Availability for the next Management
Accounting Period, break-out of all intercompany balances and
key performance indicator reports in the form of Schedule 11)
as at the end of and for that Management Accounting Period
and, in relation to the Management Accounting Periods ending
on 31 March, 30 June, 30 September and 31 December in each
year, within 45 days of the end of such Financial Quarter a
consolidation of those Management Accounts showing the
consolidated and consolidating financial position for the
Financial Quarter ending on each such date and for the
Financial Year to date;
15.2.3 LATEST PROJECTIONS: no sooner than 90 days and no later than
15 days prior to the beginning of each Financial Year,
60
consolidated and consolidating projected balance sheets,
statements of income and expense and statements of cash flow
for the IHL Group and the Group as at the end of and for each
month of such Financial Year;
15.2.4 CAPITAL EXPENDITURE: within 45 days after the end of each
Financial Quarter, a report of the Capital Expenditure of the
Group for such Financial Quarter and forecast of the projected
Capital Expenditure for the remainder of the then current
Financial Year or, in the case of the last Financial Quarter
in any Financial Year, for the following Financial Year;
15.2.5 TAXES AND CLAIMS: together with the Management Accounts
delivered under clause 15.2.2 and a certificate signed by the
finance director of Ideal that all the sums referred to in
clause 16.2.6 have been paid in respect of the period covered
by such Management Accounts;
15.2.6 GENERAL INFORMATION: at the same time as sent to its
shareholders or creditors generally, any circular, document or
other written information sent to its shareholders or
creditors as such or the shareholders or creditors of any
other Obligor; and
15.2.7 OTHER INFORMATION: from time to time on the request of the
Agent, such information about the business, operations and
financial condition of each Group Company as the Agent may
reasonably require, other than any information disclosure of
which will cause such Group Company to breach any
confidentiality undertaking to which it is a party, in which
case it shall and shall procure that any relevant Group
Company shall, use all reasonable efforts to procure the
consent of the counterparty to such undertaking to make
disclosure.
15.3 FINANCIAL INFORMATION - BASIS OF PREPARATION
BMEP, BMEBV, Ideal and BMEE shall each ensure that:
15.3.1 TRUE AND FAIR VIEW: each set of Financial Statements delivered
by it or at its request pursuant to clause 15.2.1 is prepared
(except as stated therein) using the same accounting
principles and policies as were used in the preparation of the
Ideal Pro-Forma Balance Sheet and gives a true and fair view
of the financial condition of the IHL Group and of the Group,
as the case may be, as at the end of the period to which those
Financial Statements relate and of the result of their
respective businesses and operations during such period;
15.3.2 AUDIT: each set of Financial Statements delivered by it or at
its request pursuant to clause 15.2.1 has been audited by the
Auditors and each set of Management Accounts delivered by it
pursuant to clause 15.2.2 has been certified as being correct
by
61
Ideal (acting through its finance director), subject to normal
year-end adjustments;
15.3.3 CERTIFICATE OF IDEAL: each set of Financial Statements
delivered pursuant to clause 15.2.1 and each set of Management
Accounts delivered by it pursuant to clause 15.2.2 in respect
of a Management Accounting Period ending on the last day of
any Financial Quarter (as consolidated for that Financial
Quarter) is accompanied by a certificate of Ideal (acting
through its finance director) setting forth in reasonable
detail the calculations required to establish that Ideal was
in compliance with its covenants set forth in clause 15.4
during the period covered in such Financial Statements (or, as
the case may be, during such Financial Quarter) and stating
that, except as explained in reasonable detail in such
certificate:
(a) all of the representations and warranties of each Obligor
contained in this Agreement and the other Finance Documents
are correct and complete as at the date of such certificate as
if made at such time; and
(b) no Event of Default then exists or existed during the period
covered by such Financial Statements or, as the case may be,
Management Accounts,
and describing and analysing in reasonable detail all material trends,
changes and developments in such Financial Statements or Management
Accounts. If such certificate discloses that a representation or
warranty is not correct or complete, or that a covenant has not been
complied with, or that an Event of Default existed or exists, such
certificate shall set forth what action Ideal or the relevant Obligor
has taken or proposes to take with respect thereto.
15.4 FINANCIAL RATIOS
Ideal shall ensure that, at all times, the consolidated financial
condition of the IHL Group shall be such that Adjusted Tangible Net
Worth shall not at any time be less than (pound)30,233,507 as
determined as at the Effective Date by reference to the Ideal Pro-Forma
Balance Sheet and thereafter at the end of each Financial Quarter by
reference to the accounting information (the "RELEVANT ACCOUNTING
INFORMATION") most recently delivered under this Agreement being (i)
the annual audited consolidated Financial Statements delivered under
clause 15.2.1 and (ii) each set of Management Accounts (consolidated
and consolidating for the relevant Financial Quarter) delivered under
clause 15.2.2.
In this Agreement, unless the context otherwise requires:
"ADJUSTED TANGIBLE ASSETS": means all of the IHL Group's assets except:
(i) deferred assets, other than prepaid insurance and prepaid
taxes;
62
(ii) patents, copyrights, trademarks, trade names, franchises,
goodwill and other similar intangibles;
(iii) Restricted Investments;
(iv) unamortised debt discount and expense;
(v) assets constituting Intercompany Accounts; and
(vi) fixed assets to the extent of any write-up in the book value
thereof resulting from a revaluation effective after the date
of this Agreement; and
"ADJUSTED TANGIBLE NET WORTH": means, at any date:
(i) the book value (after deducting related depreciation,
amortisation, valuation and other proper reserves as
determined in accordance with Applicable GAAP) at which the
Adjusted Tangible Assets would be shown on a consolidated
balance sheet of the IHL Group at such date prepared in
accordance with Applicable GAAP; less
(ii) the amount at which the IHL Group's liabilities would be shown
on such balance sheet, including as liabilities all reserves
for contingencies and other potential liabilities which would
be required to be shown on such balance sheet.
15.5 CHANGES IN BASIS OF PREPARATION OF RELEVANT ACCOUNTING INFORMATION
Where any Relevant Accounting Information to be delivered under clause
15 has been prepared in a manner which is inconsistent with the
accounting principles or policies in accordance with which the
Pro-Forma Balance Sheet was prepared, whether as a result of any change
in such principles or otherwise, BMEP or Ideal shall provide to the
Agent a written explanation of any such inconsistency, together with
details of its effects. If any such inconsistency would be likely to
affect the ability of the Agent to satisfy itself from the information
delivered as Relevant Accounting Information as to compliance with the
provisions of clause 15.4, the Agent shall have the right to adjust the
financial ratios set out in clause 15.4 or the relevant definitions set
out in clause 15.5 so as to reflect so far as is practicable the effect
of any such change (provided that the effect of such adjustments,
taking into consideration such change, shall not be such as to render
the said financial ratios more onerous upon BMEP than as at the date of
this Agreement).
16 COVENANTS
16.1 DURATION
The undertakings in this clause 16 shall remain in force from the date
of this Agreement and so long as any amount is outstanding under this
Agreement.
16.2 POSITIVE COVENANTS
Each Obligor undertakes that:
63
16.2.1 CONSENTS: it will, and will procure that each of the Obligors
will, obtain, comply with the terms of and do all that is
necessary to maintain in full force and effect all
authorisations, approvals, licences and consents required by
all applicable laws and regulations to enable it lawfully to
enter into, perform and comply with its obligations under each
of the Relevant Agreements to which it is or will be a party
and any document to be entered into pursuant thereto or to
ensure the legality, validity, enforceability or admissibility
in evidence of such Relevant Agreements and each such document
in England and Wales and, if different, its jurisdiction of
incorporation and any jurisdiction in which any of its assets
may be situated;
16.2.2 INSURANCE: it will maintain, and procure that each Obligor
maintains, policies of insurance on and in relation to its
business and assets with financially sound and reputable
insurers acceptable to the Agent against such risks and to
such extent as is usual for companies carrying on a business
such as that carried on by it and each Obligor whose practice
is not to self insure;
16.2.3 COMPLIANCE WITH LAW: it will comply, and will procure that
each Obligor complies, with all applicable laws and
regulations including, without limitation, any applicable
Environmental Law;
16.2.4 ENVIRONMENTAL LAWS: it will, and will procure that each
Obligor will, take prompt and appropriate action to respond to
and remedy any non-compliance with any Environmental Law and
shall regularly report to the Agent on such response and
remedying. Without limiting the generality of the foregoing,
whenever Ideal gives notice to the Agent of such
non-compliance pursuant to clause 16.2.7 Ideal will, at the
Agent's request and Ideal's expense:
(a) cause an independent environmental engineer
acceptable to the Agent to investigate and conduct
such tests of the site where any Obligor's
non-compliance or alleged non-compliance with any
Environmental Law has occurred and prepare and
deliver to the Agent a report setting forth the
results of such tests, a proposed plan for responding
to any environmental problems described therein, and
an estimate of the costs thereof; and
(b) provide to the Agent a supplemental report of such
engineer whenever the scope of the environmental
problems, or Ideal's response thereto or the
estimated costs thereof, changes;
16.2.5 CONDUCT OF BUSINESS it has, and will ensure that each Obligor
has, the right to conduct its business and operations as they
are conducted in all applicable jurisdictions and will do, and
will procure that each Obligor does, all things necessary
(including
64
compliance with all terms and conditions of any licences and
consents) to obtain, preserve and keep in full force and
effect all rights, licences and consents) to obtain, preserve
and keep in full force and effect all rights, licences and
authorisations (including, without limitation, all
Environmental Authorisations) and consents as are necessary
for the conduct of such business and operations;
16.2.6 PAYMENT OF TAXES AND CLAIMS: (a) it will, and will procure
that each Obligor will, and BMEBV will procure that each Baby
Xxxx will, duly and punctually pay and discharge (i) all taxes
imposed upon it or its properties (save where the same are
being contested in good faith and by appropriate proceedings
and where adequate reserves are being maintained with respect
thereto) and (ii) all lawful claims which, if unpaid, would by
law become encumbrances upon any of its properties; and
(b) BMEBV will procure that each Baby Xxxx will duly and
punctually pay and discharge all obligations to:
(i) pay all emoluments and benefits to which its
employees are entitled (including, without
limitation, all wages and salaries, sick pay,
maternity pay, pension contributions, bonuses,
commission, any liability to taxation (including
income tax and national insurance contributions
deducted or deductible from such amounts under the
PAYE system in the United Kingdom or such equivalent
taxation and social security payments)) in the
relevant Jurisdiction; and
(ii) comply with (in all material respects) all
statutes, regulations and collective agreements
relevant to the conditions of service of its
employees or to the relations between it and its
employees (or former employees, as the case may be),
any recognised trade union or works council and the
laws applicable to the employment of the employees in
the relevant Jurisdiction;
16.2.7 NOTICES TO AGENT: Ideal will notify the Agent in writing of
the following matters at the following times (each such notice
to describe the subject matter thereof in reasonable detail
and to set out the action that Ideal or the relevant Obligor
has taken or proposes to take with respect thereto):
(a) immediately after becoming aware of the existence of
any Default;
65
(b) immediately after becoming aware that any shareholder
in, or any creditor of, any Obligor has given notice
or taken any action with respect to a claimed default
by such Obligor and in circumstances where such
shareholder or creditor has taken or is threatening
to take any action or steps which will or might
reasonably be expected to have a material adverse
effect;
(c) immediately after becoming aware of any material
adverse change in the assets, business, operations or
condition (financial or otherwise) of any Obligor or
of the Group (taken as a whole);
(d) immediately after becoming aware of any pending or
threatened action, suit, proceeding or counterclaim
by any person which may have a material adverse
effect on any Obligor, or any pending or threatened
investigation by a public authority;
(e) immediately after becoming aware of any pending or
threatened strike, work stoppage, material unfair
labour practice claim, or other material labour
dispute affecting any Obligor;
(f) immediately after becoming aware of any violation of
any law, statute, regulation, or ordinance of a
public authority applicable to any Obligor or its
assets which may have a material adverse effect on it
or on such Obligor;
(g) immediately after becoming aware of any violation by
any Obligor of any Environmental Law or immediately
upon receipt of any notice (including a works notice)
delivered pursuant to any Environmental Law or of any
notice that a public authority has asserted that any
Obligor is not in compliance with any Environmental
Law or that its compliance is being investigated;
(h) ten (10) days prior to any Obligor changing its name
or the address of its registered office;
(i) immediately upon becoming aware that any Group
Company has received a notice or other document from
any of its suppliers notifying such Group Company of
a breach by such Group Company of any supply
agreement to which it is a party;
16.2.8 HEDGING: Ideal and each other relevant Borrower shall, within
60 days of the Closing Date or, in the case of any Additional
Borrower, within 60 days of the date upon which it becomes an
Additional Borrower, enter into such Hedging Agreements with a
Hedge Provider as the Agent may require (after consultation
with
66
Ideal) and in such form as the Agent (acting reasonably) may
require;
16.2.9 CHESSINGTON PROPERTY: Ideal shall or shall procure that Xxxx
Microproducts Limited shall promptly notify the Agent of any
proposed refinancing of all or any part of the financial
indebtedness secured by any encumbrance over the Chessington
Property and shall not complete such refinancing without the
relevant Chessington Mortgagee having entered into any
intercreditor deed or other priority arrangements in form and
substance mutually acceptable to the relevant replacement
Chessington Mortgagee, Xxxx Microproducts Limited and the
Agent;
16.2.10 AMENDMENT OF MATERIAL CONTRACTS: it will not and will procure
that none of the Trading Companies shall amend or terminate
any of the Material Contracts or agree to waive any material
or persistent breach of any of the Material Contracts without
the prior written consent of the Agent;
16.2.11 AMENDMENT TO OR BREACH OF MATERIAL CONTRACT OR STANDARD TERMS
OF BUSINESS: it will and will procure that each relevant
Trading Company will promptly (a) notify the Agent of any
proposed material change in, or amendment to, the standard
terms and conditions of business that it has entered into with
its suppliers or which it requires its customers to enter into
(including, without limitation, any material change to any
retention of title or similar provisions) and not agree to or
make any such proposed material change without the prior
approval of the Agent (such approval not to be unreasonably
withheld or delayed) and (b) notify the Agent of any material
or persistent breach by any such Trading Company or any other
person of any of the Material Contracts and, if relevant, of
any steps being taken or proposed to remedy such breach and
shall further notify the Agent of any proposal to or purported
repudiation or cancellation of, any of the Material Contracts;
16.2.12 ADDITIONAL SECURITY: without prejudice to the obligations of
each of the Obligors pursuant to the Security Documents to
which each of them it is expressed to be a party, it will
grant or procure that there is granted to the Security
Trustee, such new or further security ("ADDITIONAL SECURITY")
over any business, shares or other assets which may be
acquired pursuant to any Pre-Approved Acquisition or any other
acquisition permitted pursuant to the Finance Documents; any
such additional security shall be in such form and contain
such terms and conditions as the Agent or the Lenders (having
carried out all necessary due diligence) may require having
regard to the nature and location of the assets in question
and shall be required to be effected in favour of the Security
Trustee within 90 days (or such later date as the Agent may
agree) of the date of completion of the relevant acquisition;
it will provide the Security Trustee with such evidence as the
Security Trustee may require that all applicable laws and
67
regulations relating to the execution of such additional
security have been duly complied with (including any statutory
declarations and/or special resolutions required under
sections 155 and 156 Companies Xxx 0000; all costs and
expenses (including legal fees) incurred by any of the
Beneficiaries in preparing, negotiating and perfecting any
such additional security shall be for the account of Ideal;
16.2.13 DORMANT COMPANIES: it will ensure that each of the Dormant
Companies remains dormant and promptly notify the Agent of any
proposal for any of such companies to recommence trading,
which they shall not be permitted to do unless Ideal has
received the prior written consent of the Agent;
16.2.14 EXCESS AVAILABILITY: the Borrowers will ensure that that the
average daily Excess Availability (calculated for each month
on the last day of such month) shall be not less
than(pound)4,000,000; and
16.2.15 EC INSOLVENCY REGULATION: it will maintain, and procure that
all other members of the IHL Group maintain, its centre of
main interests (within the meaning of the EC Insolvency
Regulation) in the United Kingdom.
16.3 NEGATIVE COVENANTS
Each Obligor undertakes that:
16.3.1 ENCUMBRANCES: it will not, and will ensure that no Obligor
will, without the prior consent of the Agent, create, agree to
create or permit to subsist any encumbrance on or over their
respective assets to secure any indebtedness of any person
other than the following:
(a) any encumbrance on or over the assets of any Obligor
subsisting at the date of this Agreement and agreed
to by the Agent (and in the case of the encumbrances
held by the Chessington Mortgagee, any replacement
thereof) provided that, (save for indebtedness
secured as at the date of this Agreement by any
encumbrance created in favour of the Chessington
Mortgagee, which may be increased by up
to(pound)500,000), the principal, capital or nominal
amount secured by any such encumbrance may not be
increased beyond the amount currently secured by the
relevant encumbrance as at the date of this
Agreement, without the prior written consent of the
Agent;
(b) encumbrances in favour of the Security Trustee;
(c) liens or rights of set-off arising solely by
operation of law incurred in the ordinary course of
business and not in
68
connection with the borrowing of money, for sums not
more than 30 days overdue;
(d) encumbrances arising out of title retention
provisions in a supplier's standard conditions of
supply in respect of goods acquired by the relevant
person in the ordinary course of trading;
(e) any other encumbrance created or outstanding with the
prior written consent of the Agent;
(f) agreements and arrangements of the type referred to
in clause 16.3.5(d) to the extent that the same
constitute security;
(g) any encumbrance over any asset (other than Accounts
or Inventory) acquired by any Obligor after the date
of this Agreement and subject to which such asset is
acquired provided that (1) except with the prior
consent of the Agent, the principal, capital or
nominal amount secured by such encumbrance may not be
increased beyond the amount secured thereby at the
date of such acquisition and (2) the same is
discharged within 90 days of the date of such
acquisition;
(h) any encumbrance over the assets of any company which
becomes a Subsidiary after the date of this Agreement
pursuant to clause 16.3.11 provided that (1) except
with the prior written consent of the Agent, the
principal, capital or nominal amount secured by such
encumbrance may not be increased beyond the amount
secured thereby at the date of the acquisition and
(2) the same is discharged within 90 days of the date
of such acquisition;
provided that, in the case of any encumbrance created or
existing pursuant to sub paragraphs (a) and (e) above, it
shall be a condition to the creation of such encumbrance that
Ideal shall, if so requested by the Agent, procure that the
beneficiary of the relevant encumbrance shall accede to an
intercreditor deed or other priority arrangement on terms
acceptable to the Agent;
16.3.2 DISPOSALS: without the prior consent of the Agent, it will
not, and it will ensure that no Group Company will (whether by
a single transaction or a number of related or unrelated
transactions and whether at one time or over a period of
time), sell, transfer, assign, lease out, lend or otherwise
dispose of (whether outright, by a sale and repurchase or sale
and leaseback arrangement or otherwise) any part of its or
their assets having an aggregate value in excess of
(pound)750,000 in any one Financial Year except, sales of
Inventory in the ordinary course of trading, sales to
Affiliates
69
permitted under clause 16.3.8 and sales of Equipment permitted
under clause 16.4.11 provided that, where any matter relating
to any leasing, sub-leasing or other similar arrangement with
respect to the Chessington Property requires the consent of
the Agent pursuant to the terms of this clause 16.3.2, such
consent shall not be withheld if the relevant subject matter
also requires the consent of the Chessington Mortgagee and the
relevant Chessington Mortgagee has granted its consent to such
matter;
16.3.3 DISTRIBUTIONS AND CHANGES IN CAPITAL STRUCTURE: without the
prior consent of the Agent, it will not, and it will ensure
that no Group Company will:
(a) directly or indirectly declare, make or pay, or incur
any liability to make or pay, any Distribution, or
return any capital to any shareholder by way of
capital reduction or otherwise, provided that:
(i) BMEE may make Distributions or returns of capital
to Ideal;
(ii) Ideal and any one or more of the Baby Bells may
make Distributions or returns of capital to BMEBV;
(iii) BMEBV may make Distributions or returns of
capital to BMEP; and
(iv) BMEP may make Distributions or returns of
capital to the Parent,
all of which payments in aggregate (together with the
aggregate principal amount of all loans made pursuant
to clause 16.3.7(a)), do not exceed (pound)2,000,000
(or the equivalent in any other currency) in any
period of twelve (12) months commencing on the
Closing Date and do not exceed (pound)6,000,000 (or
the equivalent in any other currency) during the term
of this Agreement,
and provided further that the Agent shall have received a
certificate signed by the finance director of Ideal confirming
that:
(1) each of the Obligors is in compliance with all of its
obligations under the Finance Documents to which it
is a party and no Default has occurred and is
continuing or will result from the payment of the
Distribution or return of capital proposed;
(2) there is Excess Availability under the Revolving
Facility of not less than(pound)5,000,000 as at the
date of such certificate and there will be an average
Excess Availability of not less than (pound)5,000,000
both as at the proposed date of payment of the
relevant Distribution or
70
return of capital and for a continuous period of six
(6) months thereafter; and
(3) in the case of a Distribution to be paid by BMEP to
the Parent only, the largest twenty (20) trade
creditors of the Borrowers (as a whole) are being
paid in full when the relevant amounts become due in
accordance with their prevailing credit terms;
OR
(b) make any change in the capital structure of any Group
Company which could have a material adverse effect on
any Obligor or the Group (taken as a whole)
For the avoidance of doubt, no Group Company may make any
Distribution to any member of the Solutions Group;
16.3.4 TRANSACTIONS HAVING A MATERIAL ADVERSE EFFECT: it will not,
and it will ensure that no Obligor will, enter into any
transaction which has or might reasonably be expected to have,
a material adverse effect on any Obligor;
16.3.5 INDEBTEDNESS: it will not, and it will ensure that Group
Company will, incur or maintain any indebtedness other than:
(a) indebtedness under the Finance Documents;
(b) trade payables and contractual obligations to
suppliers and customers incurred in the ordinary
course of trading;
(c) indebtedness between members of the Group as
disclosed to and permitted by the Agent;
(d) indebtedness under any finance leases disclosed to
the Agent prior to the date of this Agreement or
which are fully disclosed in the Latest Projections
and budgets for Capital Expenditure of the Group as
delivered to the Agent pursuant to clauses 15.2.3 and
15.2.4 and as approved by the Agent;
(e) indebtedness due and owing under any foreign exchange
or interest-rate swap, under any option, cap, collar
or floor or under any other hedging agreement or
similar arrangement with any bank or other financial
institution and disclosed to the Agent prior to the
date of this Agreement and any replacement thereof or
other hedging arrangement (which is intended to hedge
exposure to interest rate or currency exchange
fluctuations and not an arrangement of a speculative
nature) entered into after the date of this
Agreement, in the case of interest rate hedging only,
with the prior consent of the Agent and provided
that, if the relevant
71
Hedge Provider is not the Arranger, any financial
indebtedness due and owing under the relevant hedging
arrangement may not be secured without the consent of
the Agent (acting on the instructions of all of the
Lenders); or
(f) indebtedness due and owing by Ideal or any of its
Affiliates to the Chessington Mortgagee, provided
that the aggregate principal amount of such
indebtedness may not be increased after the date of
this Agreement by an amount, in aggregate, exceeding
(pound)500,000;
and will not, in any event, pay any amount in respect of any
financial indebtedness due to the Chessington Mortgagee, save
in accordance with the provisions of the Priority Agreement or
any subsequent intercreditor deed or priority arrangement
approved by the Agent in accordance with this Agreement;
16.3.6 PREPAYMENT: it will not, and it will ensure that no Group
Company will, voluntarily prepay or redeem any financial
indebtedness, save that each Borrower may make prepayments
under this Agreement in accordance with its terms and save
that any Group Company may, in the ordinary course of
business, make early payments to any trade creditor;
16.3.7 LOANS AND GUARANTEES: it will not, and will ensure that no
Group Company will, make, roll-over or continue to remain
outstanding any loans, grant any credit (save in the ordinary
course of trading) or give any guarantee to or for the benefit
of any person (other than any guarantee permitted pursuant to
clause 16.4.13) or otherwise voluntarily assume any liability,
whether actual or contingent, in respect of any obligation of
any other person, save that
(a) BMEP, BMEBV, each of the Borrowers and each of the
Baby Bells may make any loans or grant any credit to
each other or to the Parent and to any one more of
the Baby Bells (but, subject to paragraph (d) of this
clause 16.3.7, not to any member of the Solutions
Group) which, in the case of loans to the Parent
and/or BMEP and/or BMEBV, in aggregate (and taking
into account the aggregate amount of any
Distributions or returns of capital made by any such
persons to the Parent and/or BMEP and/or BMEBV in
accordance with the terms of clause 16.3.3), do not
exceed(pound)2,000,000 (or the equivalent in any
other currency) in any period of twelve (12) months
commencing on the Closing Date and do not
exceed(pound)6,000,000 (or the equivalent in any
other currency) during the term of this Agreement;
(b) a Group Company may make loans to its employees
(other than its directors) provided that the
aggregate amount of
72
all such loans made by all of the Group Companies
shall not exceed (pound)20,000; and
(c) a Group Company may roll-over or continue to make
available (but not increase the principal amount
thereof, other than through the capitalisation of
accrued interest) any existing loans or financial
accommodation to any other Group Company or, subject
to any other applicable restrictions in this
Agreement, to a member of the Solutions Group (and
for the avoidance of doubt the aggregate amount of
loans and accrued interest outstanding to the
Solutions Group as at the date of this Agreement is
EUR8,302,070); and
(d) BMEP may make loans or other financial accommodation
to one or more members of the Solutions Group,
provided always that BMEP is able to provide evidence
satisfactory to the Agent (acting reasonably),
whether by way of the provision of Management
Accounts, Financial Statements or otherwise, from
which the Agent is able to determine that such loans
or other advances will be funded wholly out of new
funds made available to BMEP after the Closing Date
by loans from the Parent or which have otherwise been
invested in BMEP by the Parent after the Closing Date
by way of the subscription for equity or other
capital contribution in or to BMEP and not funded by
any existing funds of BMEP as at the Closing Date;
16.3.8 TRANSACTIONS WITH AFFILIATES: save to the extent permitted by
the foregoing sub clauses of this clause 16.3, it will not,
and will ensure that no Group Company will:
(a) sell, transfer, distribute or pay any money or assets
to any Affiliate;
(b) lend or advance money or assets to any Affiliate; or
(c) invest in (by capital contribution or otherwise) or
purchase or repurchase any shares or indebtedness or
any assets of any Affiliate,
save that, if no Default has occurred and is continuing, a
Group Company may engage in transactions relating to the sale
and purchase of Inventory (but not, save as otherwise
permitted in this Agreement, involving any sales of Equipment
or other fixed assets) with an Affiliate in the ordinary
course of trading in amounts and upon terms fully disclosed to
the Agent in the Management Accounts and no less favourable to
that Group Company than would obtain in a comparable arm's
length transaction with a third party which is not an
Affiliate, provided that Accounts generated between the Group
Companies and their Affiliates shall not
73
account for more than three per cent (3%) of the total number
of Accounts generated by the Borrowers and/or any other
Charging Companies;
16.3.9 CHANGE OF BUSINESS OR OPERATIONS: it will ensure that there is
no material change in the nature of its business or operations
or the business or operations of the Group taken as a whole
(whether by a single transaction or a number of related or
unrelated transactions, whether at one time or over a period
of time and whether by disposal, acquisition or otherwise);
16.3.10 ACCOUNTING REFERENCE DATE: it will not, without the prior
approval of the Agent, change, and will procure that no other
Group Company changes, its accounting reference date;
16.3.11 SUBSIDIARIES: save pursuant to any Pre-Approved Acquisition or
otherwise with the Agent's prior written consent, it will not,
directly or indirectly, organise or acquire any Subsidiary
(other than a Dormant Company or those in existence as at the
date of this Agreement and which have been advised to the
Agent in writing);
16.3.12 RESTRICTED INVESTMENTS: it will not, and will ensure that no
Group Company will make any Restricted Investment;
16.3.13 CAPITAL EXPENDITURE: it will not, and will ensure that no
Group Company will, without the prior consent of the Agent,
make or incur any Capital Expenditure if, after giving effect
thereto, the aggregate amount of all Capital Expenditure by
the Group in any Financial Year would exceed (pound)1,500,000
(or the equivalent in any other currency);
16.3.14 LEASE OR SIMILAR OBLIGATIONS: save with the prior written
consent of the Agent and save for any finance leases agreed
with the Agent pursuant to clause 16.3.5, it will not, and
will ensure that no Group Company will enter into any lease of
real or personal property as lessee or sublessee or enter into
any hire purchase, conditional sale or other similar
arrangement if, after giving effect thereto, the aggregate
amount of Rentals payable by the Group Companies in any
Financial Year in respect of such lease and all other such
leases, hire purchase, conditional sale or similar
arrangements would exceed (pound)500,000. The term "Rentals"
means all payments due from the lessee or sublessee under a
lease or all payments, liabilities or obligations due from the
hirer or other relevant obligor or debtor (howsoever
described) under any hire purchase, conditional sale or
similar arrangement, including, without limitation, rent,
service charge, utility or maintenance costs and insurance
premiums together with any VAT thereon;
16.3.15 CAPITAL MARKETS: if any Borrower, BMEP or BMEBV or any other
Group Company shall enter into any Capital Markets Transaction
then, subject to the following provisions of this clause
74
16.3.15, it shall apply or BMEP shall procure that there is
applied, thirty per cent (30%) of the net proceeds of such
Capital Markets Transaction to prepay (subject to payment of
any broken funding costs) a commensurate amount of the then
Total Outstandings, provided that, if the average Excess
Availability during the period of six (6) months ending on the
date upon which the Capital Markets Transaction is completed
was in excess of (pound)5,000,000, then the relevant issuer(s)
shall not be obliged to apply such proceeds in prepayment in
the manner prescribed by this clause 16.3.15; and
16.3.16 VENDOR FINANCING: it will not and will procure that no other
Group Company will enter into any vendor financing programme
or similar arrangement for financing the acquisition of
Equipment, any other fixed asset or Inventory (which has not
already been disclosed in its budget for Capital Expenditure
and approved by the Agent), without the prior written consent
of the Agent and without the Agent being provided with such
information as it may require as to the terms and conditions
of such vendor financing programme or other arrangement and
assessing the impact, if any, upon the Collateral and/or the
encumbrances created by the Debenture.
16.4 COVENANTS RELATING TO THE COLLATERAL
Ideal undertakes that:
16.4.1 COLLATERAL REPORTING: it will provide the Agent, in each case
in respect of each Trading Company, and on a consolidated and
consolidating basis, with the following documents at the
following times in form satisfactory to the Agent:
(a) on a weekly basis on each Wednesday based on figures
as of the previous Friday, a Borrowing Base
Certificate incorporating, inter alia, a schedule of
credit notes, a summary of collections of accounts
receivable, a schedule of Accounts created since the
last such schedule, with effect from any Inventory
Eligibility Date, a report of the Inventory balance
(by location) based on the perpetual inventory
reports and such further details as the Agent may
request;
(b) upon request, copies of invoices, credit notes,
shipping and delivery documents;
(c) monthly ageings of accounts receivable to be
delivered no later than the 10th day of each month in
respect of the immediately preceding month;
(d) monthly perpetual inventory reports by category to be
delivered no later than the 10th day of each month in
respect of the immediately preceding month;
75
(e) on a monthly basis, a report listing the top ten (10)
customers of Ideal during that month, providing (i)
details of the level of sales made to each such
customer; (ii) details of any credit notes issued to
each such customer or any other account adjustments
made in respect of such customer; and (iii) the
amount of cash actually received from each such
customer during the relevant month;
(f) with effect from any Inventory Eligibility Date, upon
request, monthly perpetual inventory reports with
effect from any Inventory Eligibility Date, a
quarterly report of all Inventory based on a physical
stock count;
(g) monthly ageings of accounts payable no later than the
10th day of the following month, together with a
specific breakdown (in reasonable detail) of the
monthly ageings of accounts payable to the largest
ten supplier creditors of Ideal and details of the
Inventory held by Ideal in respect of such accounts
payable and each such supplier;
(h) with effect from any Inventory Eligibility Date, upon
request, copies of purchase orders, invoices, and
delivery documents for Inventory and Equipment
acquired by that Trading Company;
(i) such other reports as to the Collateral and the
Accounts (and each Borrower hereby authorises the
Agent to make enquiries of its customers in this
respect) as the Agent shall request from time to
time; and
(j) certificates of an officer of Ideal certifying as to
the foregoing;
16.4.2 INSPECTION: upon receiving not more than two business days'
notice from the Agent (or without notice following a Default
which is continuing), it will, and will procure that each
Trading Company will, permit the Agent or any person
authorised by the Agent to have access to its premises to
carry out a periodic inspection of the Collateral, the
regularity of such periodic inspections to be at the Agent's
discretion, but initially to be no more often than every 60
days;
16.4.3 ACCOUNTS: it will not, and will ensure that no Trading Company
will, re-date any invoice or sale or make sales on extended
credit beyond 45 days from its standard credit terms or modify
any Account except with the prior written consent of the
Agent. If Ideal or any other Obligor becomes aware of any
material matter affecting any material Account (including
information regarding any Account Debtor's creditworthiness
and any information in respect of an Account Debtor against
whom a
76
Trading Company has commenced, or is proposing to commence,
legal proceedings), it will promptly so advise the Agent;
16.4.4 ACCEPTANCE OF NOTES OR OTHER INSTRUMENTS: it will not, and
will ensure that no Trading Company will, accept any note or
other instrument (except a cheque or other instrument for the
immediate payment of money) with respect to any Account
without the Agent's written consent. If the Agent consents to
the acceptance of any such note or other instrument, it shall
be considered as evidence of the Account and not payment
thereof, and Ideal will promptly deliver such note or
instrument to the Agent appropriately endorsed. Regardless of
the form of presentment, demand, notice of dishonour, protest
and notice of protest with respect thereto, Ideal will remain
liable thereon until such note or instrument is paid in full;
16.4.5 DISPUTES WITH ACCOUNT DEBTORS: it will notify the Agent
promptly of all disputes and claims with Account Debtors in
excess of(pound)50,000 and settle or adjust them, or ensure
that the relevant Trading Company settles or adjusts them, at
no expense to the Lenders, but no discount, credit or
allowance shall be granted to any Account Debtor without the
Agent's consent, except for discounts, credits and allowances
made or given in the ordinary course of trading when no Event
of Default exists hereunder. Ideal shall send, or procure that
there is sent to, the Agent a copy of each credit note in
excess of(pound)1,000,000 as soon as issued and a list of all
credit notes in excess of(pound)750,000 on a weekly basis,
with copies of any such credit notes to be supplied to the
Agent at the Agent's request;
16.4.6 RETURNS OF INVENTORY: if after the Inventory Eligibility Date,
an Account Debtor returns any Inventory to any Borrower or any
Trading Company when no Event of Default exists, then that
Borrower shall promptly determine the reason for such return
and shall issue, or procure that the relevant Trading Company
shall issue, a credit note to the Account Debtor in the
appropriate amount. Each Borrower shall immediately report to
the Agent any return involving an amount in excess
of(pound)1,000,000. Each such report shall indicate the
reasons for the returns and the locations and condition of the
returned Inventory. Whenever any Inventory is returned, the
related Account shall be deemed ineligible, and the Available
Revolving Facility Amount shall be adjusted accordingly;
16.4.7 INVENTORY: after the Inventory Eligibility Date, it will not,
and will ensure that no Trading Company will, without prior
written notice to the Agent, acquire or accept any Inventory
on consignment or approval;
16.4.8 INVENTORY - REPORTING SYSTEM: after the Inventory Eligibility
Date, it will maintain, and will ensure that each Trading
Company maintains, a perpetual inventory reporting system at
all
77
times; it will conduct a physical count of the Inventory of
all the Trading Companies at least once per Financial Year and
after the occurrence of an Event of Default at such other
times as the Agent requests, and shall promptly, upon
completion, supply the Agent with a copy of such count
accompanied by a report of the value of such Inventory (valued
at the lower of cost, on a FIFO basis, or market value); no
Borrower will, and will ensure that no Trading Company will,
without the Agent's prior written consent, sell any Inventory
on a sale or return, sale on approval, consignment or other
repurchase or return basis;
16.4.9 CONDITION OF THE EQUIPMENT: it will keep and maintain, and
will ensure that each Trading Company keeps and maintains, its
Equipment in good operating condition and repair (ordinary
wear and tear excepted) and will make all necessary
replacements;
16.4.10 ADDITIONS TO THE EQUIPMENT: it will include information
regarding any material additions to or deletions from any
Equipment (which, in the case of any additions, are to be
within the agreed Capital Expenditure budget) within the
Management Accounts required to be delivered pursuant to
clause 15.2.2;
16.4.11 DISPOSAL OF THE EQUIPMENT: it will not, and will ensure that
no Trading Company will, without the Agent's prior written
consent, sell, lease as a lessor, or otherwise dispose of any
Equipment provided that obsolete or unusable Equipment having
an orderly liquidation value no greater than (pound)500,000
individually and (pound)1,500,000 in the aggregate in any
Financial Year, may be disposed of without the Agent's
consent, subject to the conditions set forth below. If any of
the Equipment is sold, transferred or otherwise disposed of
with the Agent's prior written consent or as otherwise
permitted hereby then:
(a) if such sale, transfer or disposal is effected
without replacement of such Equipment, or such
Equipment is replaced by leased Equipment, or by
Equipment purchased subject to a Permitted
Encumbrance, Ideal will, or will procure that the
relevant Trading Company will, deliver all of the
cash proceeds of any such sale, transfer or disposal
to the Agent, which proceeds shall be applied in or
towards prepayment of all sums due from the Borrowers
hereunder; or
(b) if such sale, transfer or disposal is made in
connection with the purchase of replacement Equipment
(other than subject to a Permitted Encumbrance),
Ideal will use the proceeds of such sale, transfer or
disposal to finance the purchase of such replacement
Equipment which shall be free and clear of all liens,
claims and encumbrances, except for the Security
Interest and other Permitted
78
Encumbrances and shall deliver to the Agent written
evidence of the use of the proceeds for such
purchase;
16.4.12 CHESSINGTON MORTGAGE: it will procure that Xxxx Microproducts
Limited does not agree to or complete any refinancing of the
indebtedness relating to the Chessington Property unless:
(a) the Agent shall be afforded a reasonable opportunity
(subject to any applicable confidentiality
constraints) to review the terms and conditions of
such refinancing; and
(b) Ideal shall procure (or shall procure that Xxxx
Microproducts Limited shall procure) that the
relevant Chessington Mortgagee shall enter into an
intercreditor deed or priority arrangement mutually
acceptable to the relevant Chessington Mortgagee,
Xxxx Microproducts Limited and the Agent;
16.4.13 CHESSINGTON PROPERTY GUARANTEE: it will not give and will
procure that no other Group Company shall provide any
guarantee, indemnity or other assurance in respect of the
obligations of Ideal or any relevant Affiliate to the
Chessington Mortgagee (other than any guarantees in existence
as at the date hereof) unless the obligations of each relevant
Group Company and the rights and recourse of the Chessington
Mortgagee are fully subordinated to the rights of the
Beneficiaries under the Finance Documents.
17 DEFAULT
17.1 EVENTS OF DEFAULT
Each of the events set out below is an Event of Default:
17.1.1 NON-PAYMENT: any Obligor does not pay any sum due from it
under any Finance Document at the time and in the manner
specified in the relevant Finance Document, or where the
non-payment results solely from technical difficulties
relating to the transfer of that amount from the relevant
Obligor to the Agent, within five (5) days of the due date;
17.1.2 BREACH OF REPRESENTATION OR WARRANTY: any representation or
warranty made or deemed to be repeated by any Obligor in any
Finance Document or in any document delivered pursuant to it
is not complied with or is or proves to have been incorrect or
misleading in any material respect when made or deemed to be
repeated;
17.1.3 BREACH OF UNDERTAKING: the Borrower fails duly to perform or
comply with any obligation expressed to be assumed by
79
it in clause 2.2, 15, 16.2.8 to 16.2.9 inclusive, 16.3 or 16.4
or any Obligor fails duly to perform any obligation in, or
comply with any of the terms of, any of the Security
Documents;
17.1.4 BREACH OF OTHER OBLIGATION: any Obligor fails duly to perform
or comply with any other obligation expressed to be assumed by
it in any of the Finance Documents and such failure (if
capable of remedy) is not remedied within ten business days
after the earlier of (i) the date upon which any such Obligor
becomes aware of such default or (ii) the date upon which the
Agent has notified the Borrower or, as the case may be, such
Obligor of such default or if any such Finance Document shall
terminate (other than in accordance with its terms or with the
written consent of the Agent) or become void or unenforceable;
17.1.5 CROSS-DEFAULT: any indebtedness (other than indebtedness to
any one or more trade creditors arising in the ordinary course
of business which is not overdue by more than 60 days and in
respect of which the relevant trade creditor has not sought
repayment or otherwise taken steps to procure or enforce
repayment or in respect of which repayment has been sought and
the relevant Obligor is contesting in good faith by
appropriate means its liability to make payment thereof) of
any Obligor of an amount in excess of(pound)1,000,000 (or its
equivalent in any other currency) is not paid when due or is
declared to be or otherwise becomes due and payable prior to
its specified maturity or any creditor of any Obligor becomes
entitled to declare any such indebtedness due and payable
prior to its specified maturity;
17.1.6 INSOLVENCY: any Obligor or Group Company is unable to pay its
debts as they fall due (or is deemed by law or by a court to
be unable to pay its debts), stops, suspends or threatens to
stop or suspend payment of all or any part of its indebtedness
or commences negotiations with any one or more of its
creditors with a view to the general readjustment or
re-scheduling of all or any part of its indebtedness or makes
a general assignment for the benefit of, or composition with,
its creditors or a moratorium is agreed or declared in respect
of, or affecting, all or any part of its indebtedness;
17.1.7 ENFORCEMENT PROCEEDINGS: a distress, attachment, execution,
diligence or other legal process is levied, enforced or sued
out on or against all or any part of the assets of any Obligor
or Group Company and is not discharged within five business
days;
17.1.8 WINDING-UP: any Obligor or Group Company takes any corporate
action or other steps are taken or legal or other proceedings
are started for its winding-up, dissolution or re-organisation
other than for the purposes of a bona fide, solvent scheme of
reconstruction or amalgamation previously approved in writing
by the Agent (other than a petition for winding up which the
Borrower has satisfied the Agent is vexatious, groundless or
an
80
abuse of process and in relation to which the relevant Group
Company has taken steps within seven days of the petition to
restrain the petitioner from advertising the petition and
which in any event has been discharged within thirty days of
the petition) or for the appointment of a receiver,
administrator, administrative receiver, trustee or similar
officer of it or of any or all of its assets;
17.1.9 ANALOGOUS PROCEEDINGS: anything analogous to or having a
substantially similar effect to any of the events specified in
clauses 17.1.6 to 17.1.8 inclusive shall occur under the laws
of any applicable jurisdiction;
17.1.10 ENCUMBRANCE ENFORCEABLE: any encumbrance on or over the assets
of any Obligor or Group Company securing indebtedness in
excess of (pound)500,000 becomes enforceable and any step
(including the taking of possession or the appointment of a
receiver, manager or similar person) is taken to enforce that
encumbrance;
17.1.11 EXPROPRIATION: all or any material part of the shares or
assets of any Obligor is seized, compulsorily acquired,
nationalised or otherwise expropriated or custody or control
of the same is assumed by any public authority or any court of
competent jurisdiction at the instance of any public
authority, except where contested in good faith by proper
proceedings diligently pursued where a stay of enforcement is
in effect;
17.1.12 TERMINATION OF ANY GUARANTEE: any guarantee of any amounts due
and payable under any of the Finance Documents shall be
terminated, revoked or declared void or invalid;
17.1.13 JUDGMENTS: one or more final judgments for the payment of
money aggregating in excess of (pound)50,000 (whether or not
covered by insurance) shall be rendered against any Obligor
and such Obligor shall fail to discharge the same within
thirty (30) days from the date of entry thereof or to appeal
therefrom;
17.1.14 LOSS OF COLLATERAL: any loss, theft, damage or destruction of
any item or items of the Collateral occurs which in the
opinion of the Agent (i) could materially and adversely affect
the operation of any Borrower's or any Obligor's business or
the business of the Group (taken as a whole) or (ii) is
material in amount and is not adequately covered by insurance;
17.1.15 CESSATION OF BUSINESS: any Obligor ceases to carry on the
business it carries on today or enters into any unrelated
business;
17.1.16 ILLEGALITY: it is or will become unlawful for any Obligor to
perform or comply with any of its obligations under any
Relevant Agreement, or any such obligation is not or ceases to
be legal, valid and binding;
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17.1.17 REPUDIATION: any Obligor repudiates, or does or causes to be
done anything evidencing an intention to repudiate any
Relevant Agreement;
17.1.18 MATERIAL ADVERSE CHANGE: there occurs any material adverse
change in any Obligor's assets, business, operations or
condition (financial or otherwise);
17.1.19 CHANGE OF CONTROL: any person or group of connected persons
which does not have control at the date of this Agreement
acquires control of BMEP, BMEBV or any Obligor and for this
purpose "CONNECTED PERSON" shall be construed in accordance
with section 839 Income and Corporation Taxes Xxx 0000.
17.2 ACCELERATION
If at any time and for any reason (and whether within or beyond the
control of any party to any of the Finance Documents) any Event of
Default has occurred, then at any time thereafter, whilst such Event of
Default is continuing, the Agent may, and shall, if so instructed by
the Majority Lenders, by written notice to Ideal do one or more of the
following at any time or times and in any order:
17.2.1 reduce or cancel the Available Facility or any one or more of
its elements or reduce or cancel the Available Revolving
Facility Amount;
17.2.2 restrict the amount of or refuse to make available any
Revolving Loan or Swingline Loan or to issue any Letter of
Credit or Guarantee;
17.2.3 terminate this Agreement and the Revolving Facility made or to
be made available hereunder;
17.2.4 declare any Revolving Loan or any Swingline Loan, all unpaid
accrued interest or fees and any other sum then payable under
this Agreement to be due and payable on demand or on such date
as it may specify in such notice whereupon all such monies
shall become so due and payable on demand or on such date (as
the case may be);
17.2.5 require that the Borrower deposit with the Security Trustee
with respect to any Letter of Credit or Guarantee then
outstanding a Supporting Letter of Credit or cash, in the same
manner as contemplated in clause 6.14;
17.2.6 declare the Revolving Facility to be cancelled, whereupon it
shall be so cancelled and the Commitment of each Lender shall
immediately be reduced to zero;
17.2.7 enforce any or all of its rights or require that the Security
Trustee enforce any or all of its rights under any of the
Finance Documents or under applicable law.
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17.3 ON DEMAND FACILITY
If, pursuant to clause 17.2.4, the Agent declares any of the Loans (or
any other monies which may become payable hereunder) to be due and
payable on demand of the Agent, then, at any time thereafter, the Agent
may by written notice to Ideal call for repayment of any such Loans
(and any other such monies) on such date as it may specify in such
notice (whereupon the same shall become due and payable on such date
together with all unpaid accrued interest, fees and any other sums then
owed by the Borrowers hereunder) or withdraw its declaration with
effect from such date as it may specify in such notice.
17.4 LETTER OF CREDIT AND GUARANTEE FEE FOLLOWING EVENT OF DEFAULT
From the date of the occurrence of any Event of Default until such
Event of Default is remedied to the satisfaction of the Agent, or until
all sums payable hereunder have been satisfied or discharged in full
and none of the Lenders is under any contingent liability hereunder or
under any Letter of Credit or Guarantee, the Letter of Credit and
Guarantee Fee shall be calculated at the rate per annum equal to an
additional 2% per annum to that referred to in clause 22.5 on the
maximum face value of any Letter of Credit or maximum contingent
liability of the Issuer under each Guarantee then outstanding.
17.5 TERMINATION FEE
If the Agent terminates this Agreement upon an Event of Default, Ideal
shall pay the Agent for the account of the Lenders in their
Participating Proportion, immediately upon termination, a fee equal to
the early termination fee that would have been payable under clause 29
if this Agreement had been terminated on that date pursuant to Ideal's
election.
18 DEFAULT INTEREST
18.1 INTEREST ON UNPAID SUMS
If any relevant Obligor does not pay any sum payable by it under this
Agreement on its due date in accordance with the provisions of clause
20 or if any sum due and payable by any relevant Obligor under any
judgment of any court in connection with this Agreement is not paid on
the date of such judgment, it shall pay interest on the balance for the
time being outstanding (such balance being referred to in this
Agreement as the "UNPAID SUM") for the period beginning on such due
date or, as the case may be, the date of such judgment, in accordance
with the provisions of this clause 18.
18.2 DEFAULT INTEREST PERIODS
Interest under this clause 18 shall be calculated by reference to
successive periods, each of which (other than the first, which shall
begin on the due date for payment or, as the case may be, the date of
judgment as referred to in clause 18.1) shall begin on the last day of
the preceding period. Each such period shall be of such duration as the
Agent may select.
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18.3 DEFAULT INTEREST RATES
The rate of interest applicable to an unpaid sum from time to time
during each period relating to that unpaid sum shall be the rate per
annum which is the sum of (i) two per cent (2%) (ii) the Applicable
Margin (iii) LIBOR relative to such period (or, in respect of any
Swingline Loans or Reference Rate Revolving Loans, the Reference Rate)
and (iv) the Mandatory Cost, if any, applicable to that unpaid sum
provided that:
18.3.1 if, at or about 11.00 a.m. on the Quotation Date in respect of
such unpaid sum, it is not possible to determine LIBOR in
accordance with the definition of LIBOR there shall be
substituted for LIBOR the rate determined by the Agent (and
notified to Ideal) to be the weighted average of the rates (as
notified to the Agent by the Lenders prior to the first day of
the relevant Interest Period) which represent the cost to each
Lender of funding its portion of such unpaid sum during such
period from whatever sources and in whatever manner it may
select; and
18.3.2 if the unpaid sum is of the principal amount of a LIBOR
Revolving Loan which became due and payable other than on the
last day of any Interest Period relating to it, the first
default period applicable to that unpaid sum shall be of a
duration equal to the unexpired portion of that Interest
Period and the rate of interest applicable to it during that
Interest Period shall be the rate per annum equal to the sum
of two per cent (2%) and the rate applicable to it immediately
before it became due.
18.4 PAYMENT AND COMPOUNDING OF DEFAULT INTEREST
Any interest accrued due under clause 18.3 in respect of an unpaid sum
shall be due and payable and shall be paid by the relevant Obligor at
the end of the period by reference to which it is calculated or on such
other date as the Agent may specify by written notice to Ideal. If not
paid on the due date, the interest shall be added to and form part of
the unpaid sum on which interest shall accrue and be payable in
accordance with the provisions of this clause 18.
19 INDEMNITIES AND CURRENCY OF ACCOUNT
19.1 GENERAL INDEMNITIES
Ideal shall (or will procure that an Obligor will) indemnify on demand
each of the Beneficiaries against any funding or other cost, loss
(including any foreign exchange contract loss incurred by any of them),
expense or liability which it may sustain or incur, directly or
indirectly, as a result of:
19.1.1 a Loan not being made by reason of any of the conditions set
out in Schedule 2 not being satisfied or any Borrower
cancelling or purporting to cancel a Utilisation Notice; or
19.1.2 the occurrence of any Default; or
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19.1.3 the receipt or recovery by it (or the Agent on its behalf) of
all or any part of its share of any Loan or unpaid sum other
than on the last day of any Interest Period relating to that
Loan or unpaid sum.
19.2 BREAK COSTS
Ideal's liability under clause 19.1.3 shall include the amount (if any)
by which (i) the additional interest which would have been payable
under this Agreement on the amount so received or recovered had it been
received or recovered by the relevant party on the last day of the
relevant Interest Period exceeds (ii) the amount of interest which, in
the opinion of the Beneficiary concerned, would have been payable to
such Beneficiary on the last day of that Interest Period in respect of
a deposit denominated in the currency of the Loan or unpaid sum in
question equal to the amount so received or recovered placed by it with
a prime bank in London for a period starting on the second business day
following the date of such receipt or recovery and ending on the last
day of that Interest Period. For the avoidance of doubt (but without
prejudice to their obligations to pay break costs), neither Ideal nor
any other relevant Obligor shall be liable to compensate any
Beneficiary for any loss of Applicable Margin if any amount is repaid,
prepaid or cancelled by virtue of the operation of clauses 9.3 or
12.1.2.
19.3 CURRENCY INDEMNITY
Any amount received or recovered by any Beneficiary in respect of any
sum expressed to be due to it from any Obligor under any Finance
Document in a currency other than the currency (the "CONTRACTUAL
CURRENCY") in which such sum is so expressed to be due (whether as a
result of, or of the enforcement of, any judgment or order of a court
or tribunal of any jurisdiction, the winding-up of such Obligor or
otherwise) shall only constitute a discharge to such Obligor to the
extent of the amount of the contractual currency that the recipient is
able, in accordance with its usual practice, to purchase with the
amount of the currency so received or recovered on the date of receipt
or recovery (or, if later, the first date on which such purchase is
practicable). If the amount of the contractual currency so purchased is
less than the amount of the contractual currency so expressed to be
due, such Obligor shall indemnify the recipient against any loss
sustained by it as a result, including the cost of making any such
purchase.
19.4 INDEMNITY TO THE AGENT
Ideal shall (or shall procure that an Obligor shall) promptly indemnify
the Agent against any cost, loss or liability incurred by the Agent
(other than any loss occasioned by the gross negligence or wilful
misconduct of the Agent) as a result of:
19.4.1 investigating any event which it reasonably believes is a
Default; or
85
19.4.2 entering into or performing any foreign exchange contract for
the purposes of any Loan being made in a Foreign Currency; or
19.4.3 acting or relying on any notice, request or instruction which
it believes to be genuine, correct and appropriately
authorised.
19.5 NATURE OF INDEMNITIES
Each of the indemnities in this clause 19 constitutes a separate and
independent obligation from the other obligations in this Agreement,
shall give rise to a separate and independent cause of action, shall
apply irrespective of any time or indulgence granted by the Agent or
any Lender and shall continue in full force and effect notwithstanding
any order, judgment, claim or proof for a liquidated amount in respect
of any sum due under this Agreement or any other judgment or order.
20 PAYMENTS
20.1 CURRENCY OF ACCOUNT AND PAYMENT
Sterling is the currency of account and payment for all sums at any
time due from the Borrower under or in connection with any of the
Finance Documents (including damages) provided that (i) each repayment
of a Loan or a part thereof shall be made in the currency in which such
Loan is denominated at the time of that repayment; (ii) each payment of
interest shall be made in the currency in which the sum in respect of
which such interest is payable is denominated; (iii) each payment in
respect of costs and expenses shall be made in the currency in which
the same were incurred; and (iv) any amount expected to be payable in a
currency other than sterling shall be paid in that other currency.
20.2 PAYMENTS BY THE BORROWER AND THE LENDERS
On each date on which this Agreement requires an amount to be paid by
any Obligor or any of the Lenders to the Agent, that Obligor or, as the
case may be, such Lender shall make the same available to the Agent:
20.2.1 where such amount is denominated in sterling, by payment in
sterling and in same day funds (or in such other funds as may
for the time being be customary in London for the settlement
in London of banking transactions in sterling) to the Agent at
Bank of America, NA, 0 Xxxx Xxxxxx, Xxxxxx X0 0XX, sort code
16-50-50, Attn: Loans Service (or as the Agent may otherwise
specify for this purpose); or
20.2.2 where such amount is denominated in a Foreign Currency (other
than euro), by payment in such Foreign Currency and in
immediately available, freely transferable, cleared funds to
such account with such bank in the principal financial centre
of the
86
country of such Foreign Currency as the Agent may specify for
this purpose; or
20.2.3 where such amount is denominated in euro, such sum shall be
made available to the Agent by payment in euro and in
immediately available, freely transferable, cleared funds to
such account with such bank in such principal financial centre
in such participating member state of the European Union or in
London as the Agent shall from time to time nominate for this
purpose.
20.3 PAYMENTS BY THE AGENT
Save as otherwise provided herein, each payment received by the Agent
for the account of another person pursuant to clause 20.2 shall be made
available by the Agent (subject, without any liability therefor, for
delays outside the Agent's control in crediting cleared funds) to such
other person (in the case of a Lender, for the account of its Facility
Office) for value the same day (provided that such payment has been
received by the Agent by no later than 12.00 noon) by transfer to such
account of such person with such bank in the principal financial centre
of the country of the currency of such payment as such person shall
have previously notified to the Agent or (in the case of a Borrower) in
the agreed currency denomination to the account of that Borrower
specified in the Utilisation Notice.
20.4 PAYMENTS DUE ON NON-BUSINESS DAYS
If any payment of principal, interest, premium or other sum to be made
hereunder becomes due and payable on a day other than a business day,
the due date of payment shall be extended to the next succeeding
business day and interest thereon shall be payable at the applicable
interest rate during such extension (unless that next succeeding
business day falls in the following calendar month in which case the
due date of payment shall be the immediately preceding business day).
20.5 IMPRACTICABLE TO MAKE PAYMENTS
If, at any time, it shall become impracticable (by reason of any action
of any governmental authority or any change in law, exchange control
regulations or any similar event) for any Obligor to make any payments
hereunder in the manner specified in clause 20.2, then that Obligor may
agree with each or any of the Lenders to make alternative arrangements
for the payment direct to such Lender of amounts due to such Lender
hereunder provided that, in the absence of any such agreement with any
Lender, that Obligor shall be obliged to make all payments due to such
Lender in the manner specified in this Agreement. Upon reaching such
agreement the relevant Obligor and such Lender shall immediately notify
the Agent and shall thereafter promptly notify the Agent of all
payments made direct to such Lender.
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20.6 NO SET-OFF OR COUNTERCLAIM
All payments made by an Obligor under this Agreement shall be made free
and clear of and without any deduction for or on account of any set-off
or counterclaim.
20.7 REFUNDING OF PAYMENTS
Where a sum is to be paid to the Agent under this Agreement for account
of another person, the Agent shall not be obliged to (but may) make the
same available to that other person until it has been able to establish
to its satisfaction that it has actually received that sum. If and to
the extent that it does so but it proves to be the case that it had not
actually received the sum which it paid out, then, the person to whom
the Agent made that sum available shall on request refund it to the
Agent and that person or (at the option of the Agent) the person by
whom that sum should have been made available shall on request pay to
the Agent the amount (as certified by the Agent) which will indemnify
the Agent against any funding or other cost, loss, expense or liability
which it may have sustained or incurred as a result of paying out that
sum before receiving it.
20.8 DEBIT TO LOAN ACCOUNT
The Agent is hereby authorised to debit all Swingline Loans and all
Reference Rate Revolving Loans and interest thereon to a loan account
or accounts denominated in the currency denomination of each such
Swingline Loan maintained with the Agent. All fees, commissions, costs,
expenses and other charges under or pursuant to the Finance Documents
and all payments made and out-of-pocket expenses incurred by the Agent
and/or the Lenders pursuant to the Finance Documents will be debited to
such loan account(s) as of the date due from the relevant Borrower or
the date paid or incurred by the Agent and/or the Lenders, as the case
may be.
20.9 CHANGE OF CURRENCY TO EURO
With effect from the date (if any) upon which sterling is converted
into euro in accordance with EMU legislation:
20.9.1 REDENOMINATION: each obligation under this Agreement of any
party to this Agreement which, up to such time, had been
denominated in sterling shall be redenominated into euro in
accordance with EMU legislation provided that, if and to the
extent that any EMU legislation provides that an amount
denominated either in euro or in sterling as a national
currency unit of the euro can be paid by the debtor either in
euro or in that national currency unit, each party to this
Agreement shall be entitled to pay or repay any such amount
either in euro or in sterling as such national currency unit;
20.9.2 ROUNDING: without prejudice and in addition to any method of
conversion or rounding prescribed by any EMU legislation and
without prejudice to the respective liabilities for
88
indebtedness of any Obligor to the Beneficiaries and the
Beneficiaries to any Obligor under or pursuant to this
Agreement each reference in this Agreement to a minimum amount
(or an integral multiple thereof) in sterling to be paid to or
by the Agent and/or the Lenders shall be replaced by a
reference to such reasonably comparable and convenient amount
(or an integral multiple thereof) in euro as the Agent (after
consultation with Ideal but without prejudice to its rights
under this clause 20.9.2) may from time to time specify; and
20.9.3 CONSEQUENTIAL CHANGES: each provision of this Agreement shall
be subject to such reasonable changes of construction as the
Agent may (after consultation with Ideal but without prejudice
to its rights under this clause 20.9.3)from time to time
specify to be necessary or appropriate to reflect the
changeover of sterling to euro.
20.10 ORDER OF DISTRIBUTION TO LENDERS
If the amount received by the Agent from an Obligor (or, as the case
may be, from the Security Trustee pursuant to the exercise by the
Security Trustee of any rights or powers it may have pursuant to the
Security Documents) on any date is less than the total sum due under
this Agreement on that date, the Agent shall apply that amount in or
towards payment of the following sums in the following order:
20.10.1 first, in or towards payment of any sum then due to the Agent
in its capacity as such;
20.10.2 secondly, in or towards payment of any sum then due to the
Arranger in its capacity as such;
20.10.3 thirdly, in or towards payment pro rata of any sums (other
than principal of or interest on the Loans) then due to the
Lenders (or any of them);
20.10.4 fourthly, in or towards payment pro rata of any interest then
due;
20.10.5 fifthly, in or towards payment pro rata of any principal then
due,
and any such applications shall be made notwithstanding any purported
appropriation to the contrary by any person.
21 SET-OFF
Each Obligor authorises any other party to this Agreement at any time
after an Event of Default has occurred and is continuing and without
prior notice to that Obligor to apply any credit balance (whether or
not then due) to which that Obligor is at any time beneficially
entitled on any account at any office of that party in or towards
satisfaction of any sum then due from it to that party under this
Agreement and unpaid and for this purpose to purchase with the
89
monies standing to the credit of any such account such other currencies
as may be necessary to effect such application (but so that nothing in
this clause 21 shall be effective to create a charge). No party shall
be obliged to exercise any of its rights under this clause which shall
be without prejudice to and in addition to any right of set-off,
combination of accounts, lien or other right to which it is at any time
otherwise entitled (whether by operation of law, contract or
otherwise).
22 FEES
22.1 UNUSED LINE FEE
For every month during the term of this Agreement, Ideal shall (or
shall procure that another Obligor shall) pay the Agent for the account
of the Lenders a fee (the "UNUSED LINE FEE") in an amount equal to
0.25% per annum, multiplied by the average daily amount by which the
Total Commitments exceed the sum of the sterling equivalent of (i) the
average daily outstanding amount of the Revolving Loans and Swingline
Loans during such month (with the outstanding amount of Revolving Loans
and Swingline Loans calculated for this purpose by applying payments
immediately upon receipt) and (ii) the maximum contingent liability of
the Issuer under each Letter of Credit and Guarantee or, if any demand
is made under any Letter of Credit or Guarantee, the average daily
amount outstanding under any account to which any such payment made
thereunder is debited. Such fee shall be calculated on the basis of a
year of three hundred sixty five (365) days and actual days elapsed,
and shall be payable to the Agent on the first day of each month
following the Closing Date and on the termination of this Agreement, in
each case with respect to the prior month or portion thereof.
22.2 ARRANGEMENT FEE
Ideal shall pay to the Arranger for its own account an arrangement fee
in the amount and at the times agreed in a letter dated on or around
the Effective Date from the Arranger to Ideal.
22.3 COLLATERAL MANAGEMENT FEE
Ideal will pay the Agent for its own account a fee of an amount set out
in a letter of even date addressed by the Agent to Ideal (the
"COLLATERAL MANAGEMENT FEE"). The total amount of such fee shall be
deemed to have accrued due and become payable in full on the Closing
Date but the Agent agrees, subject to clause 29.3, that such fee shall
be paid in equal instalments on the Closing Date and on the first day
of each calendar month thereafter prior to the termination of this
Agreement.
22.4 AUDIT FEE
Ideal shall pay to the Agent for its own account an audit fee of
(pound)500 per day per field examiner charge (the "AUDIT FEE") in
respect of the periodic inspection of the Collateral required by the
Agent in accordance with this Agreement and shall also pay on demand
all out of pocket expenses incurred by the Agent in connection with any
such inspection.
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22.5 LETTER OF CREDIT AND GUARANTEE FEE
Ideal agrees to pay (or procure that the relevant Borrower shall pay)
to the Agent for account of the Issuer a fee (the "LETTER OF CREDIT AND
GUARANTEE FEE") equal to 2.50% per annum of the face amount of each
Letter of Credit or maximum contingent liability under each Guarantee
issued by the Issuer, plus all out-of-pocket costs, fees and expenses
incurred by the Issuer (other than where such fees, costs or expenses
are indemnified pursuant to clause 6.11.2) in connection with the
application for, issue of, or amendment to any Letter of Credit or
Guarantee, such Letter of Credit and Guarantee Fee to be calculated on
the basis of a year of 365 days and actual days elapsed and to be
payable monthly in arrears on the first day of each month following any
month in which a Letter of Credit or Guarantee was issued and/or in
which a Letter of Credit or Guarantee remains outstanding and, to the
extent that it has been calculated by reference to a Letter of Credit
or Guarantee denominated other than in sterling, shall be satisfied by
payment of the sterling equivalent of the amount so calculated. Any
out-of-pocket costs, fees and expenses incurred by the Issuer in
connection with the application for, issue of, or amendment to any
Letter of Credit or Guarantee shall be payable at the time of such
application, issue or amendment.
22.6 AGENCY AND TRUSTEE FEES
Ideal shall pay to the Agent and the Security Trustee each for its own
account the agency fees or, as the case may be, the trustee fees
specified in the letter dated on or about the date of this Agreement
from the Agent and the Security Trustee respectively to Ideal. The full
amount of such fees shall be deemed to have accrued due and become
payable in full on the Closing Date but the Agent and the Security
Trustee each agree, subject to clause 29.3, that such fees shall be
paid in equal instalments on the Closing Date and on the first day of
each calendar month thereafter prior to the termination of this
Agreement.
22.7 ADDITIONAL MONITORING AND ADMINISTRATION FEE
Without prejudice to any other rights that the Agent, the Security
Trustee or any of the Beneficiaries may have at such time under this
Agreement or any other Finance Document, Ideal agrees that, upon the
appointment of a receiver, administrator, administrative receiver,
trustee, examiner or any other similar officer or office holder of any
Obligor or of any or all of the assets of any Obligor or upon an order
being made for the winding-up, liquidation or dissolution of any
Obligor (the date of such event or occurrence being the "INSOLVENCY
DATE"), Ideal shall become liable to pay forthwith to the Agent for its
own account, an additional monitoring and administrative fee (the
"ADDITIONAL MONITORING AND ADMINISTRATION FEE") in an amount equal to
one per cent. (1%) of the higher of (a) the aggregate total of all
Accounts then due and owing from any Account Debtor to the Borrowers
(as determined by the Agent by reference to the most recent information
provided to it under clause 15.2 and clause 16.4) and (b) the Total
Commitments, in each case, as at the Insolvency Date.
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23 PRO RATA SHARING
23.1 If a Beneficiary (a "RECOVERING BENEFICIARY") receives or recovers any
amount from an Obligor other than in accordance with clause 20 and
applies that amount to a payment due under the Finance Documents then:
23.1.1 the Recovering Beneficiary shall, within three business days,
notify details of the receipt or recovery to the Agent;
23.1.2 the Agent shall determine whether the receipt or recovery is
in excess of the amount the Recovering Beneficiary would have
been paid had the receipt or recovery been received or made by
the Agent and distributed in accordance with clause 20,
without taking account of any tax which would be imposed on
the Agent in relation to the receipt, recovery or
distribution; and
23.1.3 the Recovering Beneficiary shall, within three business days
of demand by the Agent, pay to the Agent an amount (the
"SHARING PAYMENT") equal to such receipt or recovery less any
amount which the Agent determines may be retained by the
Recovering Beneficiary as its share of any payment to be made,
in accordance with clause 20.11.
23.2 REDISTRIBUTION OF PAYMENTS
The Agent shall treat the Sharing Payment as if it had been paid by the
relevant Obligor and distribute it between the Beneficiaries (other
than the Recovering Beneficiary) in accordance with clause 18.9.
23.3 RECOVERING BENEFICIARY'S RIGHTS
23.3.1 On a distribution by the Agent under clause 23.2 the Recovering
Beneficiary will be subrogated to the rights of the Beneficiaries which
have shared in the redistribution.
23.3.2 If and to the extent that the Recovering Beneficiary is not able to
rely on its rights under sub-clause 23.3.1 above, the relevant Obligor
shall be liable to the Recovering Beneficiary for a debt equal to the
Sharing Payment which is immediately due and payable.
23.4 REVERSAL OF REDISTRIBUTION
If any part of the Sharing Payment received or recovered by a
Recovering Beneficiary becomes repayable and is repaid by that
Recovering Beneficiary, then:
23.4.1 each Beneficiary which has received a share of the relevant
Sharing Payment pursuant to clause 23.2 shall, upon request of
the Agent, pay to the Agent for account of that Recovering
Beneficiary an amount equal to the appropriate part of its
share of the Sharing Payment (together with an amount as is
necessary to reimburse that Recovering Beneficiary for its
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proportion of any interest on the Sharing Payment which that
Recovering Beneficiary is required to pay); and
23.4.3 that Recovering Beneficiary's rights of subrogation in respect
of any reimbursement shall be cancelled and the relevant
Obligor will be liable to the reimbursing Beneficiary for the
amount so reimbursed.
23.5 EXCEPTIONS
23.5.1 This clause 23 shall not apply to the extent that the Recovering
Beneficiary would not, after making any payment pursuant to this clause
23, have a valid and enforceable claim against the relevant Obligor.
23.5.2 A Recovering Beneficiary is not obliged to share with any other
Beneficiary any amount which the Recovering Beneficiary has received or
recovered as a result of taking legal or arbitration proceedings, if:
(a) it notified that other Beneficiary of the legal or arbitration
proceedings; and
(b) that other Beneficiary had an opportunity to participate in
those legal or arbitration proceedings but did not do so as
soon as reasonably practicable having received notice and did
not take separate legal or arbitration proceedings.
24 COSTS, EXPENSES AND STAMP DUTIES
24.1 INITIAL AND CONTINUING COSTS AND EXPENSES
Ideal shall (or shall procure that an Obligor shall), from time to time
on demand of the Agent, reimburse the Agent for all costs and expenses
(including, without limitation, legal fees) together with VAT thereon
incurred by it in connection with the negotiation, preparation,
execution and administration of each of the Finance Documents and the
completion of the transactions contemplated therein and/or any
amendment, variation or novation of, supplement to, or waiver or
consent in respect of, any of the Finance Documents, the cost of any
appraisals, inspections, verifications and audits of the Collateral or
Group's operation the costs and expenses of forwarding loan proceeds,
of the collection of all cheques and other items of payment, of the
establishment and maintenance of any Receivables Account or other
account and the costs and expenses of defending any claims made or
threatened against the Agent arising out of the transactions
contemplated hereby.
24.2 ENFORCEMENT COSTS AND EXPENSES
Ideal shall, from time to time on demand of the Agent, reimburse the
Agent, the Security Trustee and each of the Lenders for all costs and
expenses (including legal fees and a reasonable estimate of the
allocable cost of in-house counsel and staff) together with VAT thereon
incurred in or in connection with the termination of this Agreement or
the preservation and/or
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enforcement of any of the rights of any of the Beneficiaries under any
of the Finance Documents.
24.3 STAMP DUTIES
Ideal shall (or shall procure that an Obligor shall) pay all stamp,
registration and other taxes to which any of the Finance Documents or
any judgment given in connection with any of the Finance Documents is
or at any time may be subject and shall, from time to time on demand of
the Agent, indemnify the Agent and any other Beneficiaries against any
liabilities, costs, claims and expenses resulting from any failure to
pay or any delay in paying any such tax.
24.4 PROVISIONS RELATING TO PAYMENTS
All payments to be made by Ideal (or any other Obligor) under this
clause 24 shall be made whether or not any Loan is made or Letter of
Credit or Guarantee is issued under this Agreement.
24.5 INDEMNITY BY BANKS
If Ideal fails to perform any of its obligations under this clause 24,
each Lender shall (i) in the proportion borne by its Outstandings to
the aggregate of the Outstandings of all the Lenders; or (ii) if there
are no Outstandings, in the proportion borne by its Commitment to the
Total Commitments; or (iii) if there are no Outstandings and the Total
Commitments have been cancelled at such time, in the proportion borne
by its Commitment to the Total Commitments immediately before they were
cancelled (in each case determined, and as at such time as may be
specified, by the Agent), indemnify the Agent, the Security Trustee and
the other Lenders against any loss incurred by any of them as a result
of such failure (save for any failure caused by the gross negligence or
wilful default of any such party) and Ideal shall forthwith reimburse
each Lender for any payment made by it pursuant to this clause 24.5.
25 CALCULATIONS AND EVIDENCE OF DEBT
25.1 BASIS OF CALCULATION
Interest shall accrue from day to day and shall be calculated in the
case of sterling on the basis of a year of 365 days (or, in the case of
dollars or euros, 360 days or, in any case where market practice
differs, in accordance with market practice) and the actual number of
days elapsed (not counting within any Interest Period the last day of
that Interest Period). If the basis of accrual of interest or any other
amount expressed in this Agreement in respect of sterling shall be
inconsistent with any convention or practice in the London Interbank
Market for the basis of accrual of interest or any other amount in
respect of euro, such expressed basis shall be replaced by such
convention or practice with effect from the date (if any) of conversion
of sterling into euro in accordance with EMU legislation.
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25.2 FAILURE TO SUPPLY QUOTATIONS
In on any occasion a Reference Bank or a Lender fails to supply the
Agent with a quotation required of it under any provision of this
Agreement, the rate for which such quotation was required shall be
determined from those quotations which are supplied to the Agent.
25.3 LOAN ACCOUNTS
Each Lender shall maintain in accordance with its usual practice
accounts evidencing the amounts from time to time lent by and owing to
it under this Agreement.
25.4 CONTROL ACCOUNT
The Agent shall maintain on its books a control account or accounts in
which shall be recorded (i) the amount of any Loan or unpaid sum made
or arising under this Agreement and each Lender's share in such Loan or
unpaid sum, (ii) the amount of all principal, interest and other sums
due or to become due from each Borrower to each of the Lenders under
this Agreement and each Lender's share in each such amount and (iii)
the amount of any sum received or recovered by the Agent under this
Agreement and each Lender's share in such amount.
25.5 LENDERS' BOOKS AND RECORDS.
Each Obligor agrees that the Agent's and the Lenders' books and records
showing all amounts from time to time lent by and owing to any of them
under this Agreement and the transactions pursuant to this Agreement
and the other Finance Documents shall be admissible in any action or
proceeding arising therefrom, and shall constitute prima facie proof
thereof (in the absence of manifest error), irrespective of whether any
such obligations are also evidenced by any other instrument.
25.6 MONTHLY STATEMENTS
The Agent will provide to Ideal a monthly statement of Loans, payments
and other transactions pursuant to this Agreement. Such statement shall
be deemed correct, accurate, and binding on the Obligors and as an
account stated (except for reversals and reapplications of payments
made as provided in clause 20.7 and corrections of errors).
25.7 CERTIFICATES
A certificate by the Agent or any other Finance Party as to any sum
payable by it under this Agreement or any other Finance Document shall,
in the absence of manifest error, be conclusive for the purposes of
this Agreement and such Finance Documents and prima facie evidence in
any legal action or proceedings arising out of or in connection with
this Agreement or any other Finance Documents.
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25.8 VALUE ADDED TAX
All consideration (including interest and fees) payable under a Finance
Document by the Borrower to a Beneficiary shall be deemed to be
exclusive of any VAT. If VAT is chargeable, the Borrower shall pay to
the Beneficiary (in addition to and at the same time as paying the
consideration) an amount equal to the amount of that VAT. Where a
Finance Document requires the Borrower to reimburse a Beneficiary for
any costs or expenses, the Borrower shall also at the same time pay and
indemnify that Finance Party against all VAT incurred by that Finance
Party in respect of the costs and expenses.
26 THE AGENT, THE ARRANGER, THE SECURITY TRUSTEE AND THE LENDERS
26.1 APPOINTMENT
Each Lender, the Arranger and the Security Trustee hereby appoints the
Agent to act as its agent in connection with this Agreement and the
Agent and each of the Lenders hereby appoints the Security Trustee to
act as its trustee under and in relation to the Security Documents
pursuant to this Agreement and to hold the Trust Property as trustee
for the Beneficiaries on the trusts and other terms contained in the
Security Documents and each Beneficiary hereby irrevocably authorises
the Agent and the Security Trustee to exercise such rights, powers and
discretions as are specifically delegated to the Agent or, as the case
may be, the Security Trustee by the terms of this Agreement and the
Security Documents together with all such rights, powers and
discretions as are reasonably incidental thereto provided that the
Agent may not begin any legal action or proceeding in the name of a
Lender without its consent.
26.2 ROLE OF THE ARRANGER
Except as specifically provided in the Finance Documents, the Arranger
has no obligations of any kind to any other party under or in
connection with any Finance Document.
26.3 RELATIONSHIPS
The Agent in its capacity as such is agent for the Security Trustee and
the Lenders and shall not in any respect be the agent of any Borrower
by virtue of this Agreement. Nothing in this Agreement shall constitute
the Agent or the Arranger a trustee or fiduciary for the Security
Trustee, any Lender, any Borrower or any other person.
26.4 RIGHTS OF THE AGENT AND THE SECURITY TRUSTEE
Each of the Agent and the Security Trustee may:
26.4.1 assume that any representation made by any Obligor in
connection with any of the Finance Documents is true, that no
Event of Default has occurred and that no Obligor is in breach
of or default under its obligations under any of the Finance
Documents, in each such case unless it has actual knowledge or
actual notice to the contrary;
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26.4.2 assume that the Facility Office of each Lender is that set out
under its name at the end of this Agreement or, in the case of
a Transferee, at the end of the Transfer Certificate to which
it is a party as Transferee or, in the case of a Lender which
is an assignee or other successor of another Lender or former
Lender, the office notified to the Agent by the assignee or
other successor on or before the date it becomes a Lender or,
if the Agent has been notified by any Lender of any change to
its Facility Office in accordance with the terms of this
Agreement, that last notified to the Agent;
26.4.3 engage and pay for the advice or services of any lawyers,
accountants, surveyors or other experts whose advice or
services may to it seem necessary, expedient or desirable and
rely upon any advice so obtained;
26.4.4 rely as to any matters of fact which might reasonably be
expected to be within the knowledge of an Obligor upon a
certificate signed by or on behalf of that Obligor;
26.4.5 rely upon any communication, certificate, legal opinion or
other document believed by it to be genuine;
26.4.6 refrain from exercising any right, power or discretion vested
in it as agent or, as the case may be, as trustee under any of
the Finance Documents unless and until instructed by the
Majority Lenders as to whether or not such right, power or
discretion is to be exercised and, if it is to be exercised,
as to the manner in which it should be exercised and shall in
all cases be fully protected when acting, or refraining from
acting, in accordance with instructions from the Majority
Lenders;
26.4.7 refrain from acting in accordance with any instructions of the
Majority Lenders to protect or enforce the rights of any
person under any of the Finance Documents until it has been
indemnified (or received confirmation that it will be so
indemnified) and/or secured to its satisfaction against any
and all costs, losses, expenses (including legal fees) and
liabilities which it will or may expend or incur in complying
with such instructions;
26.4.8 retain for its benefit and without liability to account any
fee or other sum receivable by it for its own account;
26.4.9 accept deposits, lend money to, provide any advisory or other
services to or engage in any kind of banking or other business
with any Company Group and, in each case, may do so without
liability to account.
26.5 OBLIGATIONS OF THE AGENT AND THE SECURITY TRUSTEE
Each of the Agent and the Security Trustee shall:
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26.5.1 promptly (or otherwise in accordance with the terms hereof)
advise each Lender of the contents of any notice or document
received by it from any Obligor under any of the Finance
Documents in its capacity as Agent or, as the case may be,
Security Trustee, except that details of any such
communication relating to a particular Lender shall be advised
to that Lender only;
26.5.2 promptly notify each Lender of the occurrence of any Event of
Default or any default by any Obligor in the due performance
of or compliance with its obligations under any of the Finance
Documents of which the Agent or, as the case may be, the
Security Trustee has actual knowledge or actual notice;
26.5.3 subject to the foregoing provisions of this clause 26, (in the
case of the Agent) act as agent under this Agreement or (in
the case of the Security Trustee) act as trustee for the
Beneficiaries in accordance with any instructions given to it
by the Majority Lenders or as this Agreement may require and
shall be fully protected in so doing. Unless expressly
provided otherwise in a Finance Document, any instructions
given by the Majority Lenders shall be binding on each of the
Beneficiaries;
26.5.4 if so instructed by the Majority Lenders, refrain from
exercising any right, power or discretion vested in it in its
capacity as Agent (under this Agreement) or in its capacity as
Security Trustee (under the Finance Documents);
26.5.5 have only those duties, obligations and responsibilities,
which it is hereby acknowledged in the case of the Agent are
only of a mechanical and administrative nature, expressly
specified in each of the Finance Documents to which it is a
party.
26.6 EXONERATION
None of the Agent, the Arranger or the Security Trustee nor any of
their respective personnel or agents shall be:
26.6.1 responsible for the adequacy, accuracy, completeness or
reasonableness of any representation, warranty, statement,
projection, assumption or information in any information
memorandum or similar document prepared in connection with any
proposed syndication of the Facilities, any Finance Document
or any notice or other document delivered under or in
connection with any Finance Document;
26.6.2 responsible for the execution, delivery, validity, legality,
adequacy, enforceability or admissibility in evidence of any
Finance Document or any such notice or other document;
26.6.3 obliged to enquire as to the occurrence or continuation of a
Default or Event of Default or the performance or compliance
by any Obligor with its obligations under any Finance
Documents;
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26.6.4 bound to account to any person for any sum or the profit
element of any sum received by it for its own account;
26.6.5 bound to disclose to any other person any information relating
to any Obligor or any Group Company, if such disclosure would
or might in its opinion constitute a breach of any law or
regulation or be otherwise actionable at the suit of any
person.
26.7 CREDIT ASSESSMENT
Each Lender confirms that it has itself been, and will continue to be,
solely responsible for making its own independent investigation and
appraisal of the business and operations, financial condition,
prospects, creditworthiness, status and affairs of each Borrower, each
other Obligor and each Group Company or any other person and has not
relied, and will not at any time rely, on the Agent, the Security
Trustee or any other Lender:
26.7.1 to check or enquire on its behalf into the adequacy, accuracy,
completeness or reasonableness of any representation,
warranty, statement, projection, assumption or information
provided by any Obligor or any other person under or in
connection with any Finance Document or the transactions
contemplated in any Relevant Agreement (whether or not such
information has been or is at any time hereafter circulated to
it by the Agent or the Security Trustee including any
contained in any information memorandum or similar document
prepared in connection with any proposed syndication of the
Facilities); or
26.7.2 to assess or keep under review on its behalf the business and
operations, financial condition, prospects, creditworthiness,
status or affairs of any Borrower, other Obligor or Group
Company or any other person.
26.8 THE AGENT AND THE SECURITY TRUSTEE AS LENDERS
The Agent and the Security Trustee shall each have the same rights and
powers with respect to its Commitment and Outstandings (if any) as any
other Lender and may exercise those rights and powers as if it were not
also acting as the Agent or, as the case may be, the Security Trustee.
26.9 INDEMNITY
Each Lender agrees that it shall, from time to time on demand of the
Agent and/or Security Trustee, indemnify the Agent and/or Security
Trustee (to the extent not reimbursed by Ideal or any other Obligor and
without prejudice to any liability of the Borrower under this
Agreement) (i) in the proportion borne by its Outstandings to the
aggregate of the Outstandings of all the Lenders; or (ii) if there are
no Outstandings, in the proportion borne by its Commitment to the Total
Commitments; or (iii) if there are no Outstandings and the Total
Commitments have been cancelled at such time, in the proportion borne
by its Commitment to the Total Commitments immediately before they were
cancelled (in each case determined, and as at such time as may be
specified,
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by the Agent), against all costs, claims, expenses (including legal
fees) and liabilities which it may sustain or incur in connection with
this Agreement or the performance of its obligations and
responsibilities under this Agreement save to the extent that they are
sustained or incurred by reason of the gross negligence or wilful
misconduct of the Agent or the Security Trustee or any of its personnel
or agents and Ideal shall (or shall procure that an Obligor shall)
forthwith reimburse each Lender for any payment made by it pursuant to
this clause 26.9.
26.10 RESIGNATION
26.10.1 RESIGNATION: Each of the Agent and the Security Trustee may following
consultation with Ideal and the Lenders resign its appointment under
any of the Finance Documents at any time by giving not less than thirty
days' notice in writing to that effect to each of the other parties to
this Agreement provided that such resignation shall not become
effective until a successor to the Agent or, as the case may be, the
Security Trustee has been appointed and accepted its appointment in
accordance with the following provisions of this clause 26.10 and, in
the case of the Security Trustee, all necessary documents have been
entered into to ensure that the benefit of the Security Documents is
held by such successor.
26.10.2 APPOINTMENT OF SUCCESSOR: If the Agent or, as the case may be, the
Security Trustee gives notice of its resignation the Majority Lenders
may appoint a successor. If the Majority Lenders have not within sixty
days after such notice of resignation appointed a successor to the
Agent or, as the case may be, the Security Trustee (which shall, in
either such case, be a reputable and experienced bank with an office in
London) which shall have accepted such appointment, the retiring Agent
or, as the case may be, Security Trustee shall have the right to
appoint such a successor itself.
26.10.3 DISCHARGE: If a successor to the Agent or, as the case may be, Security
Trustee is appointed under the provisions of this clause 26.10 then the
retiring Agent or, as the case may be, retiring Security Trustee shall
be discharged from any further obligations under the Finance Documents
but shall remain entitled to the benefit of the provisions of this
clause 26 and its successor and each of the other parties to this
Agreement shall have the same rights and obligations amongst themselves
as they would have had if such successor had been a party to this
Agreement.
26.10.4 DISCLOSURE: The retiring Agent or, as the case may be, Security
Trustee, shall make available to its successor such documents and
records and provide such assistance as the successor may reasonably
request for the purpose of performing its functions under the Finance
Documents. Notwithstanding any provision in any Finance Document to the
contrary, neither the Agent nor the Security Trustee shall be obliged
to disclose to any person any confidential or other information if the
disclosure would or might in its reasonable opinion constitute a breach
of any law or fiduciary duty.
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27 TRUSTEE PROVISIONS
27.1 DECLARATION OF TRUST
The Security Trustee shall hold the Trust Property in trust for the
benefit of the Beneficiaries on the terms and subject to the conditions
set out in this Agreement and the terms of the other Finance Documents.
Each Beneficiary hereby confirms its approval of the Finance Documents
and any security created or to be created pursuant thereto and hereby
authorises, empowers and directs the Security Trustee (by itself or
such person(s) as it may nominate) to execute and enforce the same as
trustee (and whether or not expressly in the Beneficiaries' names) on
its behalf.
27.2 PERPETUITY PERIOD
The perpetuity period under the rule against perpetuities (if
applicable) shall be the period of eighty years from the date of this
Agreement.
27.3 SUMS RECEIVED BY THE SECURITY TRUSTEE
Pending distribution under clause 27.4, the Security Trustee shall, if
reasonably practicable, place any sum received, recovered or held by it
in respect of the Trust Property in an interest bearing suspense
account with a bank or financial institution in the name of or under
the control of the Security Trustee. The interest paid on such account
shall be credited to the relevant account.
27.4 APPLICATION OF SUMS RECEIVED
Subject to the other provisions of this clause 27, the Security Trustee
shall apply all amounts standing to the credit of any account referred
to in clause 27.3 and any other amounts realised pursuant to the
exercise of any rights or powers it might have pursuant to any of the
Security Documents:
27.4.1 first, in the payment of any costs, charges and expenses of or
incidental to the appointment of any Receiver pursuant to the
Security Documents, the payment of his remuneration and the
payment and discharge of any other Expenses incurred by or on
behalf of the Receiver;
27.4.2 secondly, in or towards payment of any debts or claims which
are by statute payable in preference to the Secured
Obligations but only to the extent to which such debts or
claims have such preference;
27.4.3 thirdly, in or towards payment and discharge pro rata of any
Secured Obligations then due, owing or incurred to the
Security Trustee, in its capacity as Security Trustee (and not
in any other capacity) for its own account; and
27.4.4 fourthly, in payment to the Agent to be applied by the Agent
in or towards payment and discharge of the balance of the
Secured Obligations (if any) in accordance with the provisions
of
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clause 20.10 provided that, when distributing sums in
accordance with this clause 27.4, the Security Trustee will
treat any contingent liability as an actual liability and
distribute to the party entitled thereto accordingly. Any such
party receiving sums in respect of a contingent liability
shall place such sums on deposit with such bank (not being a
bank entitled to exercise any right of set-off or combination
or consolidation of accounts or having the benefit of any
encumbrance over such deposit) and on such terms as the
Security Trustee may approve and, if such contingent liability
shall fail to mature, shall return such sums (together with
any interest earned thereon) to the Security Trustee for
distribution in accordance with the terms of this clause 27.4.
27.5 SECURITY TRUSTEE'S SOLE RIGHT TO APPROPRIATE
No Obligor shall have the right to appropriate any payment to, or other
sum received, recovered or held by, the Security Trustee in or towards
payment of any particular part of the Secured Obligations and the
Security Trustee shall have the exclusive right to appropriate any such
payment or other sum as provided in this clause 27.
27.6 TIMING OF DISTRIBUTION
Distributions by the Security Trustee shall be made at such times as
the Security Trustee in its absolute discretion determines to be as
soon as is reasonably practicable, having regard to all relevant
circumstances, and the Security Trustee shall have no liability
whatsoever for any loss or damage which any Beneficiary might sustain
as a consequence of the timing of any such distribution.
27.7 DATE FOR CALCULATION OF SECURED OBLIGATIONS
For the purpose of any distribution by the Security Trustee, the
Security Trustee may, by notice to the Beneficiaries, fix a date (being
not earlier than the date of such notice) as at which the amount of the
Secured Obligations are to be calculated.
27.8 CERTIFICATE FROM BENEFICIARY
For the purposes of determining the amount of any payment to be made to
any Beneficiary pursuant hereto the Security Trustee shall be entitled
to call for and rely upon (and it is the intention of the parties that
the Security Trustee shall rely upon) a certificate from the relevant
Beneficiary of the amount and nature of any amount due, owing or
incurred to the relevant Beneficiary at the date fixed by the Security
Trustee for such purpose and as to such other matters as the Security
Trustee may deem necessary or desirable to enable it to make a
distribution.
27.9 MISTAKEN PAYMENTS
If the Security Trustee makes any distribution contrary to any of the
provisions of this clause 27 or any distribution made by it otherwise
transpires to have
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been invalid or the Security Trustee and the person receiving such
distribution agree that it should be refunded, the recipient shall, to
the extent that no charge is thereby created, hold the proceeds of that
distribution on trust to repay to the Security Trustee forthwith on
demand. If the trust imposed by this clause 28.9 cannot be given effect
to for whatever reason, including the possible creation thereby of a
charge, the relevant recipient shall, if and when so requested by the
Security Trustee, pay an amount equal to the proceeds of that
distribution required to be held on trust to the Security Trustee.
27.10 SUPPLEMENT TO TRUSTEE ACTS 1925 & 2000
By way of supplement to the Trustee Acts 1925 & 2000 it is expressly
declared as follows:
27.10.1 EXPERTS: the Security Trustee may, in relation to the Security
Documents, act or rely upon the opinion or advice of, or any
information obtained from, any lawyer, valuer, surveyor,
broker, auctioneer, accountant or other expert commissioned by
the Security Trustee and shall not be responsible to anyone
for any loss or damage occasioned by so acting or relying. Any
such opinion, advice or information may be sent or obtained by
letter, fax, e-mail or otherwise and the Security Trustee will
not be liable to anyone for acting in good faith on any
opinion, advice or information purporting to be conveyed by
such means even if it contains some error or is not authentic
or validly signed;
27.10.2 CERTIFICATE OF IDEAL: the Security Trustee may call for and
may accept as sufficient evidence a certificate of Ideal
signed by any director of Ideal to the effect that any
particular dealing, transaction, step or thing is, in the
opinion of such director, suitable or expedient or as to any
other fact or matter upon which the Security Trustee may, in
the exercise of any of its rights, powers or duties hereunder,
require to be satisfied and the Security Trustee need not call
for further evidence and will not be responsible to anyone for
any loss or damage occasioned by acting on any such
certificate;
27.10.3 INTERPRETATION OF SECURITY DOCUMENTS: the Security Trustee (as
between itself and each of the Beneficiaries) shall have full
power to determine in good faith all questions and doubts
arising in relation to any of the provisions of the Security
Documents and every such determination, whether made upon such
a question actually raised or implied in the acts or
proceedings of the Security Trustee, shall be conclusive and
shall (save for manifest error) bind the Security Trustee and
each Beneficiary;
27.10.4 TITLE: the Security Trustee shall accept without enquiry,
requisition, objection or investigation such title as any
Borrower (or, as the case may be, any Obligor) has to the
Trust Property to the intent that the Security Trustee shall
not in any way be responsible for its inability to exercise
any of its rights or powers or duties hereunder or for any
loss or damage thereby occasioned;
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27.10.5 PERFECTION OF SECURITY: the Security Trustee shall not be
liable for any failure, omission or defect in perfecting any
security created or purported to be created by or pursuant to
any of the Security Documents including (without prejudice to
the generality of the foregoing):
(a) failure to obtain any licence, consent or other
authority for the execution, delivery, validity,
legality, adequacy, performance, enforceability or
admissibility in evidence of any of the Security
Documents or any other document;
(b) failure to effect or procure registration of or
otherwise protect any security created or purported
to be created by or pursuant to any of the Security
Documents or any other document by registering under
any applicable registration laws in any territory,
any notice, caution or other entry prescribed by or
pursuant to the provisions of the said laws;
(c) failure to take or require any of the Obligors to
take any steps to render the security created or
purported to be created by or pursuant to any of the
Security Documents effective as regards any property
outside England and Wales or to secure the creation
of any ancillary charge under the laws of any
territory concerned; or
(d) failure to call for delivery of documents of title to
or require transfers, legal mortgages, charges or
other further assurances in relation to any of the
Trust Property;
27.10.6 ACTS AND OMISSIONS: the Security Trustee shall not in
fulfilling its duties and discharging its responsibilities as
Security Trustee be liable or responsible for any loss or
damage which may result from anything done or omitted to be
done by it in accordance with the provisions of the Security
Documents;
27.10.7 COMPLIANCE WITH LAWS: the Security Trustee may refrain from
doing anything which would or might in its opinion be contrary
to any law of any jurisdiction or any regulation or which
would or might otherwise render it liable to any person and
may do anything which is, in its absolute discretion,
necessary to comply with any such law or regulation;
27.10.8 DEPOSIT OF SECURITY DOCUMENTS: the Security Trustee shall be
at liberty to place all title deeds and other documents
certifying, representing or constituting the title to any of
the Trust Property for the time being in its hands in any safe
deposit, safe or receptacle selected by the Security Trustee
or with any bankers or banking company (including the Security
Trustee or the Agent or any of the other Beneficiaries) or
company whose business includes undertaking the safe custody
of documents or solicitors or
104
firm of solicitors, may pay all reasonable sums required to be
paid on account of or in respect of such deposit and may make
any such arrangements as it thinks fit for allowing any of the
Obligors or their respective lawyers or auditors access to or
possession of such title deeds and other documents when
necessary or convenient and the Security Trustee shall not be
responsible for any loss incurred in connection with any such
deposit, access or possession;
27.10.9 USE OF NOMINEES: any investment of any part or all of the
Trust Property may, at the discretion of the Security Trustee,
be made or retained in the names of nominees;
27.10.10 DELEGATION: the Security Trustee may, whenever it thinks fit,
delegate by power of attorney or otherwise to any person or
persons, or fluctuating body of persons, all or any of the
rights, powers, authorities and discretions vested in it by
any of the Finance Documents and such delegation may be made
upon such terms and subject to such conditions (including the
power to sub-delegate) and subject to such regulations as it
may think fit and it shall not be bound to supervise, or to be
in any way responsible for any loss, liability, costs, charges
or expenses incurred by reason of any misconduct or default on
the part of, any such delegate or sub-delegate (other than as
a result of its gross negligence or wilful misconduct); and
27.10.11 INSURANCE: without prejudice to any other provision of any of
the Finance Documents, the Security Trustee shall not be under
any obligation to insure any of the Trust Property or to
require any other person to maintain any such insurance and
shall not be responsible for any loss or damage which may be
suffered by any person as a result of the lack of or
inadequacy or insufficiency of any such insurance.
27.11 REGISTRATION AS JOINT PROPRIETOR
Each of the Beneficiaries hereby confirms and agrees that it does not
wish to be registered in accordance with Rule 146 of the Land
Registration Rules 1925 as the joint proprietor of any mortgage or
charge created pursuant to any Finance Document and accordingly
authorises the Security Trustee to hold such mortgage or charge in its
sole name as agent and trustee for the Beneficiaries and hereby
requests HM Land Registry to register the Security Trustee as the sole
proprietor of any such mortgage or charge.
27.12 RELATIONSHIP WITH THE BENEFICIARIES
The Security Trustee shall, for the purposes of the Finance Documents,
be entitled to deal with each of the Beneficiaries by dealing
exclusively with the Agent.
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27.13 INDEMNITY PROVISIONS
The Security Trustee and every attorney, agent or other person
appointed by it under any of the Finance Documents may indemnify itself
or himself out of the Trust Property against all claims, demands,
liabilities, proceedings, costs, fees, charges, losses and expenses
incurred by any of them in relation to or arising out of the taking or
holding of the Trust Property, the exercise or purported exercise of
the rights, trusts, powers and discretions vested in any of them or any
other matter or thing done or omitted to be done in connection with any
of the Finance Documents or pursuant to any law or regulation
(otherwise than as a result of its gross negligence or wilful
misconduct). Any appointee referred to above may enjoy the benefit and
enforce the terms of this clause 27.13 in accordance with the
provisions of the Contracts (Rights of Third Parties) Xxx 0000.
27.14 APPOINTMENT OF ADDITIONAL SECURITY TRUSTEES
The Security Trustee may at any time appoint any person (whether or not
a trust corporation) to act either as a separate trustee or as a
co-trustee jointly with it (i) if it considers such appointment to be
in the interests of the Beneficiaries or (ii) for the purposes of
conforming to any legal requirements, restrictions or conditions which
the Security Trustee deems relevant for the purposes hereof and the
Security Trustee shall give prior notice to the Obligors of any such
appointment. Any person so appointed shall (subject to the provisions
of the Finance Documents) have such powers, authorities and discretions
and such duties and obligations as shall be conferred or imposed on
such person by the instrument of appointment and shall have the same
rights, powers, discretions and benefits under the Finance Documents as
the Security Trustee. Save where the contrary is indicated or unless
the context otherwise requires any reference in the Finance Documents
to the Security Trustee shall be construed as a reference to the
Security Trustee and each such separate trustee and co-trustee. The
Security Trustee shall have power in like manner to remove any person
so appointed. Such remuneration as the Security Trustee may pay to any
person so appointed, and any costs, charges and expenses incurred by
such person in performing its functions pursuant to such appointment,
shall for the purposes hereof be treated as costs, charges and expenses
incurred by the Security Trustee in performing its function as trustee
hereunder.
28 ASSIGNMENTS AND TRANSFERS
28.1 BENEFIT OF AGREEMENT
This Agreement shall be binding upon and enure to the benefit of each
of the parties to it, any Transferee which becomes a party to it
pursuant to a Transfer Certificate and each of their respective
successors and assigns.
28.2 ASSIGNMENTS AND TRANSFERS BY AN OBLIGOR
No Obligor shall be entitled to assign or transfer all or any of its
rights or obligations under this Agreement.
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28.3 ASSIGNMENTS AND TRANSFERS BY LENDERS
28.3.1 Any Lender may at any time with the prior consent of the Agent and
after consultation with Ideal but without the prior consent of Ideal or
any other party to this Agreement assign all or any of its rights under
this Agreement to any bank or financial institution which is a
Qualifying Lender or transfer in accordance with clause 28.4 all or any
of its rights and obligations under this Agreement to any such
Qualifying Lender.
28.3.2 If any Lender assigns all or any of its rights under this Agreement in
accordance with clause 28.3.1 then, unless and until the assignee has
agreed with the Agent, the Security Trustee and the other Lenders that
it shall be under the same obligations towards each of them as it would
have been under if it had been a party to this Agreement, the Agent,
the Security Trustee and the other Lenders shall not be obliged to
recognise such assignee as having the rights against each of them which
it would have had if it had been a party to this Agreement.
28.4 TRANSFER CERTIFICATE
If any Lender wishes to transfer all or any of its rights and
obligations under this Agreement in respect of the whole or any part of
any Commitment in respect of the Revolving Facility and/or its
Outstandings as contemplated in clause 28.3.1, then such transfer may
be effected by the delivery to the Agent of a duly completed and duly
executed Transfer Certificate but only if it relates to its Commitment
and/or its Outstandings in respect of all the Facilities in which it is
participating at that time. Subject to clause 28.5, the Agent shall, on
receipt of such certificate, countersign it and subject to the terms of
that Transfer Certificate and on the date specified in that Transfer
Certificate:
28.4.1 each Obligor and the relevant Lender shall, to the extent
provided in such Transfer Certificate, each be released from
further obligations to each other under this Agreement and
their respective rights against each other shall be cancelled
(such rights and obligations being referred to in this clause
28 as "DISCHARGED RIGHTS AND OBLIGATIONS");
28.4.2 each Obligor and the Transferee party to the relevant Transfer
Certificate shall each assume obligations towards, and acquire
rights from, each other which differ from the discharged
rights and obligations only insofar as such Obligor and the
Transferee have assumed and acquired the same in place of such
Obligor and that Lender;
28.4.3 the Transferee and the other parties to this Agreement (other
than the Obligor) shall acquire the same rights and assume the
same obligations between themselves as they would have
acquired and assumed had such Transferee been an original
party to this Agreement as a Lender with the rights and
obligations acquired or assumed by it as a result of such
transfer (and, to that
107
extent, the transferor Lender and such other parties shall
each be released from further obligations to each other).
28.5 ACCEPTANCE AND DELIVERY OF TRANSFER CERTIFICATES
The Agent shall not be obliged to accept any Transfer Certificate
received by it under this Agreement on any day on or after the receipt
by it of a Utilisation Notice and prior to the making of the relative
Loan or issue of the relevant Letter of Credit or Guarantee. Subject
thereto the Agent shall promptly deliver a copy of any Transfer
Certificate received by it to Ideal.
28.6 RELIANCE ON TRANSFER CERTIFICATES
The Agent shall be fully entitled to rely on any Transfer Certificate
delivered to it in accordance with the provisions of this clause 28
which is complete and regular on its face as regards its contents and
purportedly signed on behalf of the Lender and the Transferee and shall
have no liability or responsibility to any party as a consequence of
placing reliance on and acting in accordance with any such Transfer
Certificate.
28.7 REGISTER OF ASSIGNMENTS, TRANSFERS AND FEES
28.7.1 REGISTER: The Agent shall (on behalf of the Lenders) maintain at its
address for the service of notices as specified in clause 31 a register
in which the Agent shall, as soon as practicable following the date of
this Agreement and thereafter on each business day following receipt by
it of any Transfer Certificate duly completed in accordance with the
provisions of this clause 28 or any certificate signed on behalf of
each Lender assigning any of its rights hereunder and the person to
whom such rights are to be assigned (provided the provisions of clause
28.3 have been complied with) and in each such case incorporating the
administrative details of the Transferee or assignee, record (where
appropriate in place of the corresponding details relating to the
transferor or assigning Lender) the names, interests and administrative
details from time to time of the Lenders having rights and/or
obligations under this Agreement. The Agent shall make the register
available for inspection by any party to this Agreement during normal
banking hours upon receipt by the Agent of reasonable prior notice to
that effect.
28.7.2 FEES: On the date upon which the transfer or assignment takes effect in
accordance with the terms of this Agreement and, as the case may be,
any Transfer Certificate or assignment documents, the Transferee named
in the Transfer Certificate or the relevant assignee shall pay to the
Agent for its own account a transfer fee of (pound)2000.
28.8 CHANGE OF FACILITY OFFICE
Any Lender may at any time change its Facility Office in relation to
its Commitment and/or Outstandings by notifying the Agent of the
address and fax details of such new office.
108
28.9 DISCLOSURE OF INFORMATION
The Agent, the Security Trustee or any Lender may (on a confidential
basis) disclose to any actual or potential assignee, Transferee,
sub-participant or other person who may otherwise enter into or be
proposing to enter into contractual relations with the Agent, the
Security Trustee or such Lender (as the case may be) in relation to
this Agreement such information about any Borrower, any other Obligor
or any other person as it thinks fit.
28.10 INCREASED PAYMENTS FOLLOWING ASSIGNMENT OR TRANSFER
If at the time of, or immediately after, any assignment or transfer by
a Lender or any change in its Facility Office, circumstances are such
that any Obligor would be obliged to pay to an assignee, Transferee
(or, in the case of a change of Facility Office, the relevant Lender)
under clause 10 or 11 any sum in excess of the sum (if any) which it
would have been obliged to pay to that Lender under the relevant clause
in the absence of that assignment, transfer or change, that Obligor
shall not be obliged to pay that excess.
29 TERM AND TERMINATION
29.1 EXPIRY OF AGREEMENT
This Agreement shall expire on the Termination Date unless earlier
terminated in accordance with the terms of this Agreement.
29.2 RIGHTS TO TERMINATE
Ideal may terminate this Agreement at any time prior to the Termination
Date if:
29.2.1 it gives the Agent sixty (60) days prior written notice of
termination;
29.2.2 it has paid and performed in full all its obligations
hereunder on or prior to the effective date of termination;
and
29.2.3 it pays the Agent, on or prior to the effective date of
termination, and in addition to any other prepayment premium
required hereunder and any amounts required by clauses 19.1
and 19.2:
(a) 2% of the aggregate on such date of (i) the Maximum
Revolving Credit Line, if such termination is made on
or prior to the first Anniversary Date;
(b) 1% of the aggregate on such date of the Maximum
Revolving Credit Line, if such termination is after
the first Anniversary Date but on or prior to the
second Anniversary Date; and
109
(c) 0.5% of the aggregate on such date of the Maximum
Revolving Credit Line, if such termination is at any
time after the second Anniversary Date.
29.3 EFFECT OF TERMINATION
Upon the effective date of termination of this Agreement for any reason
whatsoever, the Loans, all unpaid accrued interest or fees and any
other sum then payable under this Agreement shall become immediately
due and payable, the Commitment and the Available Commitment of each
Lender shall be reduced to nil and each relevant Borrower shall
immediately arrange for the cancellation of each Guarantee or Letter of
Credit then outstanding and shall deposit with the Security Trustee
with respect thereto a Supporting Letter of Credit or cash in the same
manner as contemplated in clause 6.14. Notwithstanding the termination
of this Agreement, until all such sums are paid and performed in full,
the Agent and the Lenders shall retain all their rights and remedies
hereunder and under all other Finance Documents.
30 AMENDMENTS, WAIVERS AND REMEDIES
30.1 AMENDMENTS
Subject to the proviso to this clause 30.1, the Agent may if authorised
by the Majority Lenders in writing (or to the extent expressly
authorised by the other provisions of this Agreement or any other
document entered into pursuant to this Agreement) on behalf of the
Lenders amend or vary the terms of or waive breaches of or defaults
under, or otherwise excuse performance of any provision of, or grant
consents under, this Agreement or any such other document. Any
amendment, variation, waiver, release or consent authorised under this
clause 30.1 and which is effected by the Agent must be in writing and
may be given subject to such conditions as the person giving it may
specify and shall be binding on all the parties to this Agreement and
the Agent shall be under no liability in respect thereof provided that
the consent of all the Lenders in writing shall be required in respect
of:
30.1.1 any increase in the Total Commitments or change in the
Termination Date;
30.1.2 any extension of the date for, or alteration in the amount or
currency of, any payment of principal, interest, fee or other
amounts payable under this Agreement;
30.1.3 any change in the rate at which interest is payable under this
Agreement;
30.1.4 the definition of "MAJORITY LENDERS";
30.1.5 any release or deferment of the granting or perfecting of an
encumbrance or any of the Collateral except in connection with
any permitted disposal of Equipment or any disposal permitted
under clause 16.3.2) or any Security Interest or any guarantee
or similar undertaking provided by any person;
110
30.1.6 this clause 30.1.
30.2 WAIVERS
No failure to exercise, nor any delay in exercising, on the part of the
Agent, the Security Trustee or any Lender, any right or remedy under
this Agreement shall operate as a waiver thereof, nor shall any single
or partial exercise of any right or remedy prevent any further or other
exercise of such right or remedy or the exercise of any other right or
remedy. The rights and remedies provided in this Agreement are
cumulative and not exclusive of any rights or remedies provided by law.
31 PARTIAL INVALIDITY
If, at any time, any provision of the Finance Documents is or becomes
illegal, invalid or unenforceable in any respect under any law of any
jurisdiction:
31.1 it shall be ineffective only to that extent, without
invalidating the remainder of such Finance Document(s); and
31.2 neither the legality, validity or enforceability of such
provision under the law of any other jurisdiction will in any
way be affected or impaired thereby.
32 NOTICES
32.1 GENERAL
Any demand, notice or other communication or document to be made or
delivered under or in connection with the Finance Documents shall be
made or delivered by fax or otherwise in writing and shall be treated
as having been served if served in accordance with clause 32.2. Each
demand, notice, communication or other document to be made on or
delivered to any party to the Finance Documents may (unless that other
person has by 10 business days' written notice to the other specified
another address or fax number) be made or delivered to that other
person at its registered office or the address or fax number (if any)
set out under its name at the end of this Agreement or, in the case of
a Transferee, at the end of the Transfer Certificate to which it is a
party as Transferee or, in the case of a Lender which is an assignee or
other successor of another Lender or former Lender, as notified to the
Agent by the assignee or other successor on or before the date it
became a Lender.
32.2 MODE OF SERVICE
Any demand, notice, communication or other document to be made or
delivered from or to an Obligor shall be delivered to, by or through
the Agent. Subject thereto, service of any demand, notice or other
communication or document to be made or delivered under the Finance
Documents may be made:
32.2.1 by leaving it at the address for service referred to in clause
32.1;
111
32.2.2 by sending it by pre-paid first class letter (or by airmail if
to or from an address outside the United Kingdom) through the
post to the address for service referred to in clause 32.1; or
32.2.3 by fax to the fax number of the recipient and so that any fax
shall be deemed to be in writing and, if it bears the
signature of the server or its authorised representative or
agent, to have been signed by or on behalf of the server.
32.3 DEEMED SERVICE
32.3.1 Any notice or other communication or document from an Obligor (or Idea
on its behalf) shall be irrevocable and shall not be effective until
its actual receipt by the Agent. Any other notice, demand or other
communication or document shall be served or treated as served at the
following times:
(a) in the case of service personally or in accordance with clause
32.2.1, at the time of such service;
(b) in the case of service by post, at 9.00 am on the working day
next following the day on which it was posted or, in the case
of service to or from an address outside the United Kingdom,
at 9.00 am on the fourth day following the day on which it was
posted; and
(c) in the case of service by fax, if sent before 9.00 am on a
working day, at 11.00 am on the same day, if sent between 9.00
am and 5.30 pm on a working day, two hours after the time of
such sending or, if sent after 5.30 pm on a working day or on
a day other than a working day, at 9.00 am on the next
following working day.
32.3.2 For the purposes of this clause 32 the term "WORKING DAY" shall mean a
day (other than a Saturday or Sunday) upon which the recipient of any
demand, notice, communication or other document is normally open for
business in the country of its address for service referred to in
clause 32.1 and references to any time of day shall be construed as
references to the time of day on such working day in that country.
32.4 PROOF OF SERVICE
In proving service of any demand, notice, communication or other
document served:
32.4.1 by post, it shall be sufficient to prove that such demand,
notice, communication or other document was correctly
addressed, full postage paid and posted; and
32.4.2 by fax, it shall be sufficient to prove that the fax was
followed by such machine record as indicates that the entire
fax was sent to the relevant number.
112
33 COUNTERPARTS
Each Finance Document may be executed in any number of counterparts,
and this has the same effect as if the signatures on the counterparts
were on a single copy of the Finance Document.
34 DUTCH PARALLEL DEBT
Without prejudice to the provisions of this Agreement and for the
purpose of ensuring and preserving the validity and continuity of the
security rights granted and to be granted by any of the Obligors under
or pursuant to the Security Documents, each of the Beneficiaries hereby
acknowledges and consents to BMEBV and to any other Obligor
incorporated or established under the laws of the Netherlands (each, a
"DUTCH OBLIGOR") that are at any time party to any Security Document,
undertaking to pay to Bank of America, National Association, acting in
its capacity as Security Trustee, amounts (i) equal to the amounts due
from time to time by the Obligors to the Beneficiaries in respect of
the Secured Obligations and (ii) due and payable at the same time as
the corresponding amounts in respect of the Secured Obligations are or
shall be due and payable (such payment undertaking and the obligations
and liabilities resulting therefrom being, the "PARALLEL DEBT"). The
Beneficiaries hereby agree that the Parallel Debt is a claim of Bank of
America, National Association (in its capacity as Security Trustee)
which is independent and separate from, and without prejudice to, the
claims of Beneficiaries in respect of the Secured Obligations, and is
not a claim which is held jointly with the Beneficiaries provided that,
to the extent any amounts are paid to Bank of America, National
Association under the Parallel Debt or that Bank of America, National
Association otherwise receives monies in payment of the Parallel Debt,
the total amount due and payable in respect of the Secured Obligations
shall be decreased as if the said amounts were received directly in
payment of the outstanding Secured Obligations. Bank of America,
National Association, acting in its capacity as Security Trustee,
hereby agrees to transfer to the Agent for the benefit of the
Beneficiaries all proceeds that it receives or recovers from any Dutch
Obligor in connection with any enforcement action taken under or
pursuant to any Security Document.
35 LAW AND JURISDICTION
35.1 LAW
This Agreement shall be governed by, and construed in accordance with,
English law.
35.2 JURISDICTION
35.2.1 SUBMISSION: Each Obligor irrevocably agrees for the benefit of the
other parties hereto that the courts of England shall have jurisdiction
to hear and determine any suit, action or proceeding, and to settle any
disputes, which may arise out of or in connection with this Agreement
and, for such purposes, irrevocably submits to the jurisdiction of such
courts.
113
35.2.2 FORUM: Each Obligor irrevocably waives any objection which it might now
or hereafter have to the courts referred to in clause 35.2.1 being
nominated as the forum to hear and determine any suit, action or
proceeding, and to settle any disputes, which may arise out of or in
connection with this Agreement and agrees not to claim that any such
court is not a convenient or appropriate forum.
35.2.3 SERVICE OF PROCESS: BMEP and BMEBV each agree that the process by which
any suit, action or proceeding is begun may be served on it by being
delivered in connection with any suit, action or proceeding in England,
to Ideal at its registered office for the time being.
35.2.4 OTHER COMPETENT JURISDICTIONS: The submission to the jurisdiction of
the courts referred to in clause 35.2.1 shall not (and shall not be
construed so as to) limit the right of the other parties hereto, or any
of them, to take proceedings against any Obligor in any other court of
competent jurisdiction nor shall the taking of proceedings in any one
or more jurisdictions preclude the taking of proceedings in any other
jurisdiction, whether concurrently or not.
35.2.5 CONSENT TO ENFORCEMENT: Each Obligor hereby consents generally in
respect of any legal action or proceeding arising out of or in
connection with this Agreement to the giving of any relief or the issue
of any process in connection with such action or proceeding including,
without limitation, the making, enforcement or execution against any
property whatsoever (irrespective of its use or intended use) of any
order or judgment which may be made or given in such action or
proceeding.
AS WITNESS the hands of the duly authorised representatives of the parties
hereto the day and year first before written.
114
SCHEDULE 1
LENDERS AND COMMITMENTS
LENDER COMMITMENT ((POUND))
Bank of America, National Association 75,000,000
115
SCHEDULE 2
CONDITIONS PRECEDENT
A ORIGINAL DOCUMENTS TO BE COLLECTED BY THE AGENT
1 A certificate dated in the form appearing in Schedule 3 duly executed by
each Obligor with all required enclosures.
2 The Debenture duly executed by each Obligor and all other documents to be
delivered pursuant thereto and notice of the assignment of each of its
Receivables Accounts and of the Policies (as therein defined) having been
given to, and acknowledged by, the bank at which each such Receivables
Account is to be maintained or, as appropriate, by the relevant broker or
insurer with which or through whom such Policy is placed.
3 All share certificates in respect of shares held by each Obligor and
charged pursuant to the Debenture together with instruments of transfer
endorsed in blank as required by the terms of the Debenture.
4 Confirmation from Ideal that the terms of all contracts or arrangements
under which Inventory is supplied to the Trading Companies on reservation
of title terms have not been amended since completion of the review
thereof by the Agent during the July/August 2002 audit.
5 Utilisation Notice in respect of the first Revolving Loan and any
Swingline Loan in substantially the form set out in Schedule 4 duly
executed by the relevant Borrower.
6 Policies of insurance, including credit insurance, acceptable to the Agent
with the name of the Security Trustee endorsed as loss payee in respect of
such policies as may be specified by the Agent and acknowledgements of
assignment in satisfactory terms signed by underwriters of the insurance
policies assigned by the Obligors pursuant to the Debenture.
7 In relation to each Obligor, details of each of its clearing accounts and
each (if any) of its Receivables Accounts.
8 An opinion of Dutch counsel addressed to the Agent as to, among other
matters, the entry into and performance by BMEP and BMEBV of the Finance
Documents to which they are a party and legal, valid, binding and
enforceable nature of their respective obligations thereunder.
9 The Pro-Forma Balance Sheet of BMEP.
10 The Latest Projections.
11 The Priority Agreement duly executed by the parties thereto.
12 A Warranty (in terms satisfactory to the Agent) by Ideal as to the value
of the Inventory and the Accounts of the Trading Companies as at the
Closing Date.
116
13 A report by Ideal showing, in relation to the Trading Companies, details
of monthly ageings of accounts receivable, monthly ageings of accounts
payable and details of all preferential creditors and of cash, if any, at
bank as at 31 October 2002.
14 An undertaking issued by The Royal Bank of Scotland plc in favour of the
Security Trustee agreeing, on the terms and conditions therein set out, to
effect a daily cash sweep to the Security Trustee of all amounts standing
to the credit of the account therein described.
B EVIDENCE
1 Evidence as to the discharge of all indebtedness and financing facilities
(other than Permitted Indebtedness) (including, without limitation, the
discharge in full of the Existing Facilities) of and encumbrances (other
than Permitted Encumbrances) over the assets of, any Group Company which
may exist at the date of this Agreement including, without limitation, all
encumbrances created by any Group Company in favour of National
Westminster Bank Plc or The Royal Bank of Scotland Commercial Services
Limited or any of their Affiliates other than the legal mortgage dated 31
October 2000 created by Xxxx Microproducts Limited over the Chessington
Property in favour of the existing Chessington Mortgagee.
2 Ideal shall have paid (to the extent then payable) all fees payable on the
date of this Agreement including all fees and expenses of the Agent's
legal advisers in connection with any of the Finance Documents and the
transactions contemplated thereby.
3 The Agent being satisfied that the ageing profile and turnover of Accounts
and Inventory has not deteriorated as against their ageing profile and
turnover at the time of the audit thereof by the Agent.
4 There shall have occurred no material adverse change in the business or
financial condition of any Borrower, any Obligor or the Group (taken as a
whole) or in the Collateral since the date of the Pro Forma Balance Sheet
and the Group has met the financial performance projections contained in
the Latest Projections, and the Agent has received a certificate of
Ideal's chief executive officer to such effect.
5 After taking into account any Revolving Loans or Swingline Loans to be
made on the Closing Date and any Letters of Credit or Guarantees issued or
to be issued on the Closing Date and with all the obligations of the
Borrowers being current there shall be remaining an Available Revolving
Facility Amount of at least (pound)5,000,000.
6 Evidence satisfactory to the Agent that there has been no change to the
legal structure of Group since 1 June 2002 and that the Adjusted Tangible
Net Worth of BMEP is not less than EUR18,467,000.
7 Evidence that Ideal has agreed to act as the agent of BMEP and BMEBV for
the service of process in England.
117
SCHEDULE 3
FORM OF OBLIGOR'S CERTIFICATE
From: [Obligor's name and address]
To: Bank of America, National Association
Business Credit Xxxx
0 Xxxx Xxxxxx
Xxxxxx X0 0XX
as Agent for and on behalf of the Lenders
Attention: Xxxxxx Xxxxxxxxx
CREDIT AGREEMENT DATED | | AND MADE BETWEEN, AMONG OTHERS, IDEAL HARDWARE
LIMITED AND XXXX MICROPRODUCTS EUROPE EXPORT LIMITED AS ORIGINAL BORROWERS, BANK
OF AMERICA, NATIONAL ASSOCIATION AS AGENT, ARRANGER, ISSUER AND SECURITY TRUSTEE
AND THE LENDERS NAMED THEREIN (THE "CREDIT AGREEMENT").
This certificate is provided for the purposes of the Credit Agreement. Unless
stated otherwise, terms defined in the Credit Agreement shall have the same
meanings in this certificate. We | |, and | |, the secretary and a
director respectively of the [relevant Obligor] hereby certify that:
1 The copy or copies delivered herewith:
1.1 of the memorandum and articles of association, certificate of
incorporation and certificate(s) of incorporation on change of name
(if any) of [relevant Obligor] marked "A";
1.2 of a resolution of the board of directors of [relevant Obligor]
approving the execution and delivery of the Finance Documents to
which it is party and the performance of its obligations thereunder
and authorising a named person or persons to sign such Finance
Documents and any documents to be delivered by [relevant Obligor]
pursuant thereto marked "B";
1.3 marked "C", being copies of each law, decree, consent, licence,
approval, registration or declaration as is, in the opinion of local
counsel to the Agent, necessary to render the Finance Documents to
which it is a party valid, legally binding and enforceable and to
make each of them admissible in evidence in England and Wales and,
if different, the [relevant Obligor's] jurisdiction of incorporation
and any jurisdiction in which any of its assets may be situated and
to enable [relevant Obligor] to perform its obligations under such
Finance Documents;
1.4 [marked "D", being copies of each Environmental Licence held by
[relevant Obligor];]
118
1.5 [marked "E", being copies of each policy of insurance maintained by
each Borrower and each other [Obligor] [Group Company];]*
1.6 [marked "F" are copies of each of the Material Contracts as may be
required by the Agent; and]*
1.7 [of the register of members and directors and secretary of [relevant
Obligor] marked "G"],
are in each such case true, complete and up to date copies of the
originals.
2 The persons whose names are listed below have been authorised on behalf of
the [relevant Obligor], and pursuant to the board resolution described
above to execute the Finance Documents to which [relevant Obligor] is
party and any documents or notices to be delivered by [relevant Obligor]
pursuant thereto and the signatures set opposite their names are their
true signatures:
NAME OF SIGNATORY SIGNATURE
--------------------- ------------------------ -------------------------
--------------------- ------------------------ -------------------------
--------------------- ------------------------ -------------------------
--------------------- ------------------------ -------------------------
--------------------- ------------------------ -------------------------
Secretary
Name: Date
--------------------- ------------------------
Director
Name: Date
[relevant Obligor]
*Ideal's certificate only
119
SCHEDULE 4
FORM OF UTILISATION NOTICE
From: [relevant Borrower]
To: Bank of America, NA
Business Credit Xxxx
0 Xxxx Xxxxxx
Xxxxxx X0 0XX
as Agent for and on behalf of the Lenders
Dear Sirs,
1 We refer to the agreement (as from time to time amended, varied,
supplemented, novated or replaced, the "CREDIT Agreement") dated o
December 2002 and made between, among others, ourselves as Borrower,
yourselves as the Agent, Arranger and Security Trustee and the Lenders
therein referred to. Terms defined in the Credit Agreement have the same
meanings in this notice.
2 We hereby give you irrevocable and unconditional notice that, pursuant to
the Credit Agreement and on [date of proposed Loan/issue of Letter of
Credit/issue of Guarantee], we wish to:
2.1 borrow a Swingline Loan [in the amount of(pound)] [in the Original
Sterling Amount of(pound)] [in [specify agreed Foreign Currency]];
2.2 borrow a [Reference Rate/LIBOR] Revolving Loan [in the amount
of(pound)] [in the Original Sterling Amount of(pound)] [in [specify
agreed Foreign Currency]] having an initial Interest Period of | |
months;
2.3 [have a Letter of Credit issued in favour of | | for [(pound)/other
currency amount] maturing not later than | | and in respect of
[specify details]];
2.4 [have a Guarantee issued in favour of | | for [(pound) /other
currency amount] maturing not later than | | and in respect of
[specify details]],
[in each case] upon the terms and subject to the conditions contained in
the Credit Agreement.
3 We confirm that, as at today's date, the representations set out in
clauses 14.1 and 14.2 of the Credit Agreement are true and that no
Default has occurred or is foreseen by us.
120
Yours faithfully,
----------------------------
for and on behalf of
[RELEVANT BORROWER]
121
SCHEDULE 5
MANDATORY COST FORMULAE
1 The Mandatory Cost is an addition to the interest rate to compensate
Lenders for the cost of compliance with (a) the requirements of the Bank
of England and/or the Financial Services Authority (or, in either case,
any other authority which replaces all or any of its functions) or (b) the
requirements of the European Central Bank.
2 On the first day of each Interest Period (or as soon as possible
thereafter) the Agent shall calculate, as a percentage rate, a rate (the
"ADDITIONAL COST RATE") for each Lender, in accordance with the paragraphs
set out below. The Mandatory Cost will be calculated by the Agent as a
weighted average of the Lenders' Additional Cost Rates (weighted in
proportion to the percentage participation of each Lender in the relevant
Loan) and will be expressed as a percentage rate per annum.
3 The Additional Cost Rate for any Lender lending from a Facility Office in
a participating member state will be the percentage notified by the Lender
to the Agent. This percentage will be certified by that Lender in its
notice to the Agent to be its reasonable determination of the cost
(expressed as a percentage of that Lender's participation in all Loans
made from that Facility Office) of complying with the minimum reserve
requirements of the European Central Bank in respect of loans made from
that Facility Office.
4 The Additional Cost Rate for any Lender lending from a Facility Office in
the United Kingdom will be calculated by the Agent as follows:
4.1 in relation to a sterling Loan:
AB + C(B - D)Ex0.01
------------------- per cent per annnum
100-(A+C)
4.2 in relation to a Loan in any currency other than sterling:
Ex0.01
------ per cent per annnum
300
Where:
A is the percentage of Eligible Liabilities (assuming these to be in
excess of any stated minimum) which that Lender is from time to time
required to maintain as an interest free cash ratio deposit with the
Bank of England to comply with cash ratio requirements.
B is the percentage rate of interest (excluding the Margin and the
Mandatory Cost and, if the Loan is an unpaid sum, the additional
rate of interest specified in clause 18.3) payable for the relevant
Interest Period on the Loan.
122
C is the percentage (if any) of Eligible Liabilities which that Lender
is required from time to time to maintain as interest bearing
Special Deposits with the Bank of England.
D is the percentage rate per annum payable by the Bank of England to
the Agent on interest bearing Special Deposits.
E is the rate of charge payable by that Lender to the Financial
Services Authority pursuant to the Fees Regulations (but, for this
purpose, ignoring any minimum fee required pursuant to the Fees
Regulations) and expressed in pounds per (pound)1,000,000 of the Fee
Base of that Lender.
5 For the purposes of this Schedule:
5.1 "ELIGIBLE LIABILITIES" and "SPECIAL DEPOSITS" have the meanings
given to them from time to time under or pursuant to the Bank of
England Act 1998 or (as may be appropriate) by the Bank of England.
5.2 "FEES REGULATIONS" means the Banking Supervision (Fees) Regulations
in force from time to time or such other law or regulation as may be
in force from time to time in respect of the payment of fees for
banking supervision; and
5.3 "FEE BASE" has the meaning given to it, and will be calculated in
accordance with, the Fees Regulations.
6 In application of the above formulae, A, B, C and D will be included in
the formulae as percentages (ie 5 per cent will be included in the formula
as 5 and not as 0.05). A negative result obtained by subtracting D from B
shall be taken as zero. The resulting figures shall be rounded to four
decimal places.
7 Each Lender shall supply any information required by the Agent for the
purpose of calculating its Additional Cost Rate. In particular, but
without limitation, each Lender shall supply the following information in
writing on or prior to the date on which it becomes a Lender:
7.1 its jurisdiction of incorporation and the jurisdiction of its
Facility Office; and
7.2 any other information that the Agent may reasonably require for such
purpose.
Each Lender shall promptly notify the Agent in writing of any change to
the information provided by it pursuant to this paragraph.
8 The percentages or rates of charge of each Lender for the purpose of A, C
and E above shall be determined by the Agent based upon the information
supplied to it pursuant to paragraph 7 above and on the assumption that,
unless a Lender notifies the Agent to the contrary, each Lender's
obligations in relation to cash ratio deposits, Special Deposits and the
Fees Regulations are the same
123
as those of a typical bank from its jurisdiction of incorporation with a
Facility Office in the same jurisdiction as its Facility Office.
9 The Agent shall have no liability to any person if such determination
results in an Additional Cost Rate which over or under compensates any
Lender and shall be entitled to assume that the information provided by
any Lender pursuant to paragraphs 3 and 7 above is true and correct in all
respects.
10 The Agent shall distribute the additional amounts received as a result of
the Mandatory Cost to the Lenders on the basis of the Additional Cost Rate
for each Lender based on the information provided by each Lender pursuant
to paragraphs 3 and 7 above.
11 Any determination by the Agent pursuant to this Schedule is in relation to
a formula, the Mandatory Cost, an Additional Cost Rate or any amount
payable to a Lender shall, in the absence of manifest error, be conclusive
and binding on all parties to this Agreement.
12 The Agent may from time to time, after consultation with Ideal and the
Lenders, determine and notify all parties any amendments which are
required to be made to this Schedule in order to comply with any change in
law, regulation or any requirements form time to time imposed by the Bank
of England, the Financial Services Authority or the European Central Bank
(or, in any case, any other authority which replaces al or any of its
functions) and any such determination shall, in the absence of manifest
error, be conclusive and binding on all parties.
124
SCHEDULE 6
FORM OF TRANSFER CERTIFICATE
To: Bank of America, National Association
Business Credit Xxxx
0 Xxxx Xxxxxx
Xxxxxx X0 0XX
as Agent for the Beneficiaries
TRANSFER CERTIFICATE
relating to the agreement (as from time to time amended, varied, supplemented,
novated or replaced, the "CREDIT AGREEMENT") of even date and made between (1)
IDEAL HARDWARE LIMITED and XXXX MICROPRODUCTS EUROPE EXPORT LIMITED (the
"ORIGINAL BORROWERS") (2) BM EUROPE PARTNERS CV (3) BANK OF AMERICA NATIONAL
ASSOCIATION in its capacity as agent for the Lenders(the "AGENT"), in its
capacity as arranger (the "ARRANGER"), as the lender making SWINGLINE LOANS (the
"SWINGLINE LENDER"), as the lender issuing Letters of Credit or Guarantees (the
"ISSUER") and as security trustee under the Security Documents (the "SECURITY
TRUSTEE") (3) BANK OF AMERICA, NATIONAL ASSOCIATION and | | (the "LENDERS").
Terms defined in the Agreement have the same meanings in this Transfer
Certificate.
1 [Transferor] (the "LENDER") hereby confirms the accuracy of the summary of
its participation in the Agreement set out in the Schedule below and
requests [Transferee] (the "TRANSFEREE") to accept and procure the
transfer to the Transferee of such part of such participation specified in
the Schedule by counter-signing and delivering this Transfer Certificate
to the Agent at its address for the service of notices specified in the
Agreement.
2 The Transferee hereby requests the Agent to accept this Transfer
Certificate as being delivered to the Agent pursuant to and for the
purposes of clause 28.4 of the Agreement so as to take effect in
accordance with the terms thereof on the business day following the date
of receipt by it of this Transfer Certificate or (if later) on [specify
date of transfer] subject only to the provisions of the Agreement.
3 The Transferee confirms that it has received from the Lender a copy of the
Agreement together with such other documents and information as it has
required in connection with this transaction and that it has not relied
and will not hereafter rely on the Lender to check or enquire on its
behalf into the adequacy, accuracy or completeness of any such documents
or information or the reasonableness of any representation, warranty,
statement, projection or assumption contained therein or into the
legality, validity, effectiveness, enforceability or admissibility in
evidence of any such documents or information and further agrees that it
has not relied and will not hereafter rely on the Lender to assess or keep
under review on its behalf the business/operations, financial condition,
prospects, creditworthiness, status or affairs of any Borrower or any
other Obligor.
125
4 The Transferee hereby undertakes with the Lender and each of the other
parties to the Agreement that it will perform in accordance with their
terms all those obligations which by the terms of the Agreement will be
assumed by it after delivery of this Transfer Certificate to the Agent and
satisfaction of the conditions (if any) subject to which this Transfer
Certificate is expressed to take effect.
5 The Lender makes no representation or warranty and assumes no
responsibility with respect to the legality, validity, effectiveness,
adequacy or enforceability of the Finance Documents or any document
delivered pursuant thereto and assumes no responsibility for the financial
condition of any of the Obligors or any other party to the Finance
Documents or for the performance and observance by any of the Obligors or
any other such party of any of its obligations under any of the Finance
Documents or any document delivered pursuant thereto and any and all such
conditions and warranties, whether express or implied by law or otherwise,
are hereby excluded.
6 The Lender gives notice that nothing in this Transfer Certificate or in
any of the Finance Documents (or any document delivered pursuant thereto)
shall oblige the Lender (i) to accept a re-transfer from the Transferee of
the whole or any part of its rights and obligations under the Agreement
transferred pursuant to this Transfer Certificate or (ii) to support any
losses directly or indirectly sustained or incurred by the Transferee by
reason of the failure by any of the Obligors or any other party to the
Finance Documents (or any document delivered pursuant thereto) to perform
or comply with its obligations under any of the Finance Documents or any
such document. The Transferee hereby acknowledges the absence of any such
obligation as is referred to in (i) and (ii) above.
7 The Transferee confirms that its Facility Office and address for notices
for the purposes of the Agreement are as set out in the Schedule.
8 The Transferee undertakes to pay to the Agent for its own account a
transfer fee of(pound)2,000 as provided in clause 28.7 of the Agreement.
9 This Transfer Certificate and the rights and obligations of the parties
hereunder shall be governed by and construed in accordance with English
law.
AS WITNESS the hands of the authorised signatories of the parties hereto on the
date appearing below.
126
THE SCHEDULE
COMMITMENT PORTION TRANSFERRED
LENDER'S PARTICIPATION IN LOANS REPAYMENT DATE PORTION TRANSFERRED
[Lender] [Transferee]
By: By:
Date: Date:
ADMINISTRATIVE DETAILS OF TRANSFEREE
Facility Office: ---------------------
---------------------
---------------------
Contact Name: ---------------------
Account for payments: ---------------------
Telephone: ---------------------
Fax: ---------------------
127
SCHEDULE 7
THE DORMANT COMPANIES, THE CHARGING COMPANIES AND THE BABY BELLS
PART 1
THE DORMANT COMPANIES
COMPANY COMPANY NUMBER
Xxxx Microproducts Europe Limited 04026955
Logical Online Limited 03803158
Ideal Unisolve Limited 04002602
Xxxx Microproducts ApS N/A
PART 2
THE CHARGING COMPANIES
COMPANY COMPANY NUMBER
Ideal Hardware Limited 03969946
Xxxx Microproducts Europe Export Limited 03711148
Xxxx Microproducts Europe BV N/A
Xxxx Microproducts Limited 04079671
Unifund Limited 03942210
PART 3
THE BABY BELLS
COMPANY COMPANY NUMBER
Xxxx Microproducts BV
Xxxx Microproducts Sarl 43474497500013
Xxxx Microproducts GmbH HRB 40296
Xxxx Microproducts AB SE556597-7385
Xxxx Microproducts BVBA 647989
128
Xxxx Microproducts S.r.l. 13456670150
129
SCHEDULE 8
FORM OF ACCESSION NOTICE
To: Bank of America, National Association
Business Credit Xxxx
0 Xxxx Xxxxxx
Xxxxxx X0 0XX
as Agent for the Beneficiaries
From: [Group Company] and [Ideal]
Dated:
Dear Sirs
CREDIT AGREEMENT DATED | | AND MADE BETWEEN, AMONG OTHERS, IDEAL HARDWARE
LIMITED AND XXXX MICROPRODUCTS EUROPE EXPORT LIMITED AS ORIGINAL BORROWERS, BANK
OF AMERICA, NATIONAL ASSOCIATION AS AGENT, ARRANGER, ISSUER AND SECURITY TRUSTEE
AND THE LENDERS NAMED THEREIN (AS AMENDED FROM TIME TO TIME, THE "CREDIT
AGREEMENT").
1 [Group Company] agrees to become an [Additional Borrower] [Unsecured
Guarantor] and to be bound by the terms of the Credit Agreement as an
[Additional Borrower] [Unsecured Guarantor] pursuant to clause 3 of the
Credit Agreement. [Group Company] is a company duly incorporated under the
laws of [name of relevant jurisdiction].
2 [Group Company's] administrative details are as follows:
Address:
Fax No.:
Attention:
3 This letter is governed by English law.
[This Accession Notice is entered into as a deed.]
[Ideal] [relevant Group Company]
130
SCHEDULE 9
DOCUMENTS TO ACCOMPANY ACCESSION NOTICE OR SUPPLEMENTAL DEED
1 A copy, certified a true copy by a duly authorised officer of the proposed
[Additional Borrower] [Unsecured Guarantor] [Charging Company], of the
constitutive documents of such proposed [Additional Borrower] [Unsecured
Guarantor] [Charging Company].
2 A copy, certified a true copy by a duly authorised officer of the proposed
[Additional Borrower] [Unsecured Guarantor] [Charging Company], of a board
resolution of such proposed [Additional Borrower] [Unsecured Guarantor]
[Charging Company] approving the execution and delivery of a [Accession
Notice] [Supplemental Deed], the accession of such proposed [Additional
Borrower] [Unsecured Guarantor] [Charging Company] to [this Agreement]
[the Debenture] and the performance of its obligations under the Finance
Documents and authorising a person or persons (specified by name or
office) on behalf of such proposed [Additional Borrower] [Unsecured
Guarantor] [Charging Company] to execute and deliver such [Accession
Notice] [Supplemental Deed], any other Finance Document and any other
documents to be delivered by such proposed [Additional Borrower]
[Unsecured Guarantor] [Charging Company] pursuant hereto or thereto.
3 A certificate of a duly authorised officer of the proposed [Additional
Borrower] [Unsecured Guarantor] [Charging Company] setting out the names
and signatures of the person or persons mentioned in the resolution
referred to in paragraph 2 above.
4 A certificate addressed to the Agent signed by two authorised signatories
of the proposed [Additional Borrower] [Unsecured Guarantor] [Charging
Company] stating that the execution by such proposed [Additional Borrower]
[Unsecured Guarantor] [Charging Company] of the [Accession Notice]
[Supplemental Deed] and the performance of such proposed [Additional
Borrower] [Unsecured Guarantor] [Charging Company] of its obligations
hereunder and thereunder are within its corporate powers, have been duly
approved by all necessary corporate action and will not cause any limit or
restriction on any of its powers (whether imposed by law, decree, rule,
regulation, its constitutive documents or agreement or otherwise) or on
the right or ability of its directors to execute such powers, to be
exceeded or breached.
5 A copy of its latest audited financial statements.
6 Such legal opinion(s) of counsel to the Agent as the Agent may require, in
a form satisfactory to the Agent.
7 [In connection with the acquisition of any company where such company or
any of its Subsidiaries accedes as a Charging Company to the Debenture or
otherwise executes a Security Document (such person thus becoming an
"OBLIGOR"):
131
7.1 a certificate addressed to the Agent from the Auditors confirming in
the context of section 155(2) Companies Xxx 0000 that:
7.1.1 in their opinion such Obligor had positive net assets as
defined in section 154(2) Companies Xxx 0000;
7.1.2 they are not aware of anything to indicate that the decision
of the directors of such Obligor not to make a provision in
relation to the giving of financial assistance represented by
the execution of each such Security Document to which it is a
party has not been made on fair and reasonable grounds; and
7.1.3 the giving of such financial assistance by such Obligor would
not cause those net assets to be reduced,
7.2 in each such case dated as at the date of the giving of such
financial assistance;
7.3 a statutory declaration by all of the directors of such Obligor as
required by Section 155(6) Companies Xxx 0000 in relation to such
financial assistance, such statutory declaration to be in the
prescribed form and having attached thereto the report addressed by
the Auditors complying with the provisions of Section 156(4)
Companies Xxx 0000;
7.4 a copy, certified by a duly authorised officer of such Obligor as
being a true copy, of the resolution of its board of directors
approving the matters and things required to be done by it pursuant
to this paragraph 8 and in particular the giving of such financial
assistance.]*
8 Such other documents or evidence relating to such proposed [Additional
Borrower] [Unsecured Guarantor] [Charging Company] as the Agent may
reasonably require.
* This paragraph only applies where a company being acquired (or one or more of
its Subsidiaries) is acceding to the Debenture or otherwise executing a Security
Document to secure borrowings raised for its acquisition.
132
SCHEDULE 10
THE MATERIAL CONTRACTS
DESCRIPTION OF AGREEMENT DATE PARTIES
Microsoft EMEA Distribution Agreement 1 July 2002 (1) Ideal
(2) Microsoft Ireland Operations
Limited
Microsoft OEM Distribution Agreement 1 October 2001 (1) Ideal
(2) Microsoft Licensing Inc
Compaq Direct Business Partner 1 March 1999 (1) Ideal
Agreement with respective Compaq
Commercial Terms Addendum for (2) Compaq Computer Limited
Distributors
Europe Authorized Distributor 1 January 2002 (1) Ideal
Agreement
(2) Seagate Removable Storage
Solutions LLC
Specialist Distributor Agreement [ ] (1) Ideal
(2) Fujitsu Siemens Computers Ltd
Master Distribution Agreement 25 May 2000 (1) Ideal
(2) International Business
Machines Corporation
International Distribution Agreement 3 March 2000 (1) Ideal
(2) Network Associates
International B.V.
133
SCHEDULE 11
FORM OF KEY PERFORMANCE INDICATORS REPORT
[COMPANY NAME]
FORECAST [YEAR]
XXXX MICROPRODUCTS EUROPE
KEY PERFORMANCE INDICATORS
JAN - [] FEB [] MAR [] APR [] MAY [] JUN [] JUL [] KPI
DAYS
(CUMULA-
TIVE) [] [] [] [] [] [] []
WEEKLY
INVOICING
UK PER FORECAST
Europe
Export PER FORECAST
Europe PER FORECAST
HARD GP
MARGIN
UK [] [] [] [] [] [] [] []%
FORECAST
WEEK
ENDING
[]-AUG []-AUG []-AUG []-AUG []-SEP []-SEP []-SEP []-SEP []-SEP []-OCT []-OCT
DAYS
(CUMULA-
TIVE) [] [] [] [] [] [] [] [] [] [] []
WEEKLY
INVOICING
UK (pound)[] (pound)[] (pound)[] (pound)[] (pound)[] (pound)[] (pound)[] (pound)[] (pound)[] (pound)[] (pound)[]
Europe
Export (pound)[] (pound)[] (pound)[] (pound)[] (pound)[] (pound)[] (pound)[] (pound)[] (pound)[] (pound)[] (pound)[]
Europe (pound)[] (pound)[] (pound)[] (pound)[] (pound)[] (pound)[] (pound)[] (pound)[] (pound)[] (pound)[] (pound)[]
HARD GP
MARGIN
UK
134
Europe []% []% []% []% []% []% []% []%
Cash PER
collections FORECAST
Gross inventory [] [] [] [] [] [] [] []%
Days Inventory [] [] [] [] [] [] [] []%
ADDITIONAL
MONTHLY
REPORTING
Monthy DSO (90
day rolling
average)
Reserved []
inventory
Summary stock
aging
Europe
Cash
collections (pound)[] (pound)[] (pound)[] (pound)[] (pound)[] (pound)[] (pound)[] (pound)[] (pound)[] (pound)[]
Gross inventory
Days Inventory
ADDITIONAL
MONTHLY
REPORTING
Monthy DSO (90
day rolling
average)
Reserved []
inventory
Summary stock
aging
135
THE ORIGINAL BORROWERS
SIGNED for and on behalf of )
IDEAL HARDWARE LIMITED )
by: )
Address: Xxxxxxxx Xxxxx
Xxx Xxxx
Xxxxxxxxxxx
Xxxxxx XX0 0XX
Fax: 000 0000 0000
Attention: Xxxx Xxx/Xxxxx Xxxxxxx
SIGNED for and on behalf of )
XXXX MICROPRODUCTS EUROPE )
EXPORT LIMITED by: )
Address: Xxxxxxxx Xxxxx
Xxx Xxxx
Xxxxxxxxxxx
Xxxxxx XX0 0XX
Fax: 000 0000 0000
Attention: Xxxx Xxx/Xxxxx Xxxxxxx
THE DUTCH OBLIGORS
SIGNED by its Managing Partner )
for and on behalf of )
BM EUROPE PARTNERS C.V. )
Address: x/x Xxxxxxxx Xxxxx
Xxx Xxxx
Xxxxxxxxxxx
Xxxxxx XX0 0XX
Fax: 000 0000 0000
Attention: Xxxx Xxx/Xxxxx Xxxxxxx
SIGNED for and on behalf of )
XXXX MICROPRODUCTS )
EUROPE BV )
by: )
Address: x/x Xxxxxxxx Xxxxx
Xxx Xxxx
Xxxxxxxxxxx
Xxxxxx XX0 0XX
Fax: 000 0000 0000
Attention: Xxxx Xxx/Xxxxx Xxxxxxx
136
THE AGENT
SIGNED for and on behalf of )
BANK OF AMERICA, NATIONAL )
ASSOCIATION by: )
Address: New Xxxxx Xxxxxx Xxxxx
00 Xxx Xxxxx Xxxxxx
Xxxxxx XX0X 0XX
Fax: 000 0000 0000
Attention: Xxxxxx Xxxxxxx/Xxxxxx Xxxxxxxxx (Business Credit)
THE ARRANGER
SIGNED for and on behalf of )
BANK OF AMERICA, NATIONAL )
ASSOCIATION by: )
Address: New Xxxxx Xxxxxx Xxxxx
00 Xxx Xxxxx Xxxxxx
Xxxxxx XX0X 0XX
Fax: 000 0000 0000
Attention: Xxxxxx Xxxxxxx/Xxxxxx Xxxxxxxxx (Business Credit)
THE SECURITY TRUSTEE
SIGNED for and on behalf of )
BANK OF AMERICA, NATIONAL )
ASSOCIATION by: )
Address: New Xxxxx Xxxxxx Xxxxx
00 Xxx Xxxxx Xxxxxx
Xxxxxx XX0X 0XX
Fax: 000 0000 0000
Attention: Xxxxxx Xxxxxxx/Xxxxxx Xxxxxxxxx (Business Credit)
137
THE SWINGLINE LENDER
SIGNED for and on behalf of )
BANK OF AMERICA, NATIONAL )
ASSOCIATION by: )
Address: New Xxxxx Xxxxxx Xxxxx
00 Xxx Xxxxx Xxxxxx
Xxxxxx XX0X 0XX
Fax: 000 0000 0000
Attention: Xxxxxx Xxxxxxx/Xxxxxx Xxxxxxxxx (Business Credit)
THE ISSUER
SIGNED for and on behalf of )
BANK OF AMERICA, NATIONAL )
ASSOCIATION by: )
Address: New Xxxxx Xxxxxx Xxxxx
00 Xxx Xxxxx Xxxxxx
Xxxxxx XX0X 0XX
Fax: 000 0000 0000
Attention: Xxxxxx Xxxxxxx/Xxxxxx Xxxxxxxxx (Business Credit)
138
THE LENDERS
SIGNED for and on behalf of )
BANK OF AMERICA, NATIONAL )
ASSOCIATION by: )
Address: New Xxxxx Xxxxxx Xxxxx
00 Xxx Xxxxx Xxxxxx
Xxxxxx XX0X 0XX
Fax: 000 0000 0000
Attention: Xxxxxx Xxxxxxx/Xxxxxx Xxxxxxxxx (Business Credit)
139
SCHEDULE 2
FORM OF OBLIGOR'S CERTIFICATE
From: [Obligor's name and address]
To: Bank of America, National Association
Business Credit Xxxx
0 Xxxx Xxxxxx
Xxxxxx X0 0XX
as Agent for and on behalf of the Lenders
Attention: Xxxxxx Xxxxxxxxx
CREDIT AGREEMENT DATED 2 DECEMBER 2002 AND MADE BETWEEN, AMONG OTHERS, IDEAL
HARDWARE LIMITED AND XXXX MICROPRODUCTS EUROPE EXPORT LIMITED AS ORIGINAL
BORROWERS, BANK OF AMERICA, NATIONAL ASSOCIATION AS AGENT, ARRANGER, ISSUER AND
SECURITY TRUSTEE AND THE LENDERS NAMED THEREIN (AS AMENDED BY A SUPPLEMENTAL
AGREEMENT DATED * NOVEMBER 2003, THE "CREDIT AGREEMENT").
This certificate is provided for the purposes of the Credit Agreement. Unless
stated otherwise, terms defined in the Credit Agreement shall have the same
meanings in this certificate. We [ ], and [ ], the secretary and a director
respectively of the [relevant Obligor] hereby certify that:
1 The copy or copies of the memorandum and articles of association,
certificate of incorporation and certificate(s) of incorporation on change
of name (if any) of [relevant Obligor] delivered to the Agent on or about
2 December 2002 have not been amended in any respect;
2 The copy or copies delivered herewith:
2.1 of a resolution of the board of directors of [relevant Obligor] approving
the execution and delivery of the Finance Documents to which it is party
and the performance of its obligations thereunder and authorising a named
person or persons to sign such Finance Documents and any documents to be
delivered by [relevant Obligor] pursuant thereto marked "A";
2.2 marked "B", being copies of each law, decree, consent, licence, approval,
registration or declaration as is, in the opinion of local counsel to the
Agent, necessary to render the Finance Documents to which it is a party
valid, legally binding and enforceable and to make each of them admissible
in evidence in England and Wales and, if different, the [relevant
Obligor's] jurisdiction of incorporation and any jurisdiction in which any
of its assets may be situated and to enable [relevant Obligor] to perform
its obligations under such Finance Documents;
are in each such case true, complete and up to date copies of the
originals.
3 The persons whose names are listed below have been authorised on behalf of
the [relevant Obligor], and pursuant to the board resolution described
above to execute the Finance Documents to which [relevant Obligor] is
party and any documents or
8
notices to be delivered by [relevant Obligor] pursuant thereto and the
signatures set opposite their names are their true signatures:
NAME OF SIGNATORY SIGNATURE
----------------------- ----------------------- -----------------------
----------------------- ----------------------- -----------------------
----------------------- ----------------------- -----------------------
----------------------- ----------------------- -----------------------
Secretary
Name: Date
----------------------- -----------------------
Director
Name: Date
[relevant Obligor]
*Ideal's certificate only
9
SCHEDULE 3
FORM OF SUPPLEMENTAL DEED
10
THE ORIGINAL BORROWERS
SIGNED for and on behalf of )
IDEAL HARDWARE LIMITED )
by: )
Address: Xxxxxxxx Xxxxx
Xxx Xxxx
Xxxxxxxxxxx
Xxxxxx XX0 0XX
Fax: 000 0000 0000
Attention: Xxxx Xxx/Xxxxx Xxxxxxx
SIGNED for and on behalf of )
XXXX MICROPRODUCTS EUROPE )
EXPORT LIMITED by: )
Address: Xxxxxxxx Xxxxx
Xxx Xxxx
Xxxxxxxxxxx
Xxxxxx XX0 0XX
Fax: 000 0000 0000
Attention: Xxxx Xxx/Xxxxx Xxxxxxx
THE DUTCH OBLIGORS
SIGNED by its Managing Partner )
for and on behalf of )
BM EUROPE PARTNERS C.V. )
Address: x/x Xxxxxxxx Xxxxx
Xxx Xxxx
Xxxxxxxxxxx
Xxxxxx XX0 0XX
Fax: 000 0000 0000
Attention: Xxxx Xxx/Xxxxx Xxxxxxx
1
SIGNED for and on behalf of )
XXXX MICROPRODUCTS )
EUROPE BV )
by: )
Address: x/x Xxxxxxxx Xxxxx
Xxx Xxxx
Xxxxxxxxxxx
Xxxxxx XX0 0XX
Fax: 000 0000 0000
Attention: Xxxx Xxx/Xxxxx Xxxxxxx
THE AGENT
SIGNED for and on behalf of )
BANK OF AMERICA, NATIONAL )
ASSOCIATION by: )
Address: New Xxxxx Xxxxxx Xxxxx
00 Xxx Xxxxx Xxxxxx
Xxxxxx XX0X 0XX
Fax: 000 0000 0000
Attention: Xxxxxx Xxxxxxxxx (Business Credit)
THE ARRANGER
SIGNED for and on behalf of )
BANK OF AMERICA, NATIONAL )
ASSOCIATION by: )
Address: New Xxxxx Xxxxxx Xxxxx
00 Xxx Xxxxx Xxxxxx
Xxxxxx XX0X 0XX
Fax: 000 0000 0000
Attention: Xxxxxx Xxxxxxxxx (Business Credit)
THE SECURITY TRUSTEE
SIGNED for and on behalf of )
2
BANK OF AMERICA, NATIONAL )
ASSOCIATION by: )
Address: New Xxxxx Xxxxxx Xxxxx
00 Xxx Xxxxx Xxxxxx
Xxxxxx XX0X 0XX
Fax: 000 0000 0000
Attention: Xxxxxx Xxxxxxxxx (Business Credit)
THE SWINGLINE LENDER
SIGNED for and on behalf of )
BANK OF AMERICA, NATIONAL )
ASSOCIATION by: )
Address: New Xxxxx Xxxxxx Xxxxx
00 Xxx Xxxxx Xxxxxx
Xxxxxx XX0X 0XX
Fax: 000 0000 0000
Attention: Xxxxxx Xxxxxxxxx (Business Credit)
THE ISSUER
SIGNED for and on behalf of )
BANK OF AMERICA, NATIONAL )
ASSOCIATION by: )
Address: New Xxxxx Xxxxxx Xxxxx
00 Xxx Xxxxx Xxxxxx
Xxxxxx XX0X 0XX
Fax: 000 0000 0000
Attention: Xxxxxx Xxxxxxxxx (Business Credit)
THE LENDERS
SIGNED for and on behalf of )
BANK OF AMERICA, NATIONAL )
ASSOCIATION by: )
3
Address: New Xxxxx Xxxxxx Xxxxx
00 Xxx Xxxxx Xxxxxx
Xxxxxx XX0X 0XX
Fax: 000 0000 0000
Attention: Xxxxxx Xxxxxxxxx (Business Credit)
SIGNED for and on behalf of )
GE COMMERCIAL FINANCE LIMITED by: )
Address: Xxxxxxxxxx Xxxxx
Xxxxxxxx Xxxx
Xxxxxxx XX0 0XX
Fax: 00000 000 000
Attention: Xxxxx Xxxxxx
SIGNED for and on behalf of )
LLOYDS TSB COMMERCIAL FINANCE )
LIMITED by: )
Address: Xxxxxxxx Xxxxx
Xxxxxx Xxxx
Xxxxx Xxx, Xxxxxxxxxxx
Xxxxxxxxx XX00 0XX
Fax: 00000 000000
Attention: Xxxxxx Xxxxxxxxx or Xxx Xxxxxx
SIGNED for and on behalf of )
ENTERPRISE FINANCE EUROPE )
(UK) LIMITED by: )
Address: 0xx Xxxxx
00 Xxxxxxx Xxxxxx
Xxxxxx XX0X 0XX
Fax: 0000 000 0000
Attention: Xxxxx Xxxxxx/Xxxxxx Xxxxxxx/Xxxxx Xxxxx/Xxxxx Xxxxx
4
