EXHIBIT 4(mm)
Dated May 12, 2004
PCCW CAPITAL NO. 3 LIMITED
U.S.$456,000,000
7.88 per cent. Guaranteed Notes due 2013
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SUPPLEMENTAL AGENCY AGREEMENT
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20th Floor
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00-00 Xxxxxxx Xxxx
Xxxxxxx
Xxxx Xxxx
INDEX
Clause Page No.
1. Interpretation.............................................................1
2. Transfer of obligations and rights.........................................2
3. Amendments to the agreement................................................2
4. Copies available for inspection............................................2
5. Notices....................................................................2
6. Counterparts...............................................................3
7. Descriptive Headings.......................................................4
8. Governing Law and Submission to Jurisdiction...............................4
9. Contracts (Rights of Third Parties) Act 1999...............................5
SCHEDULE - CONDITIONS OF THE NOTES.............................................6
SIGNATORIES...................................................................24
PCCW CAPITAL NO. 3 LIMITED
U.S.$456,000,000
7.88 per cent. Guaranteed Notes due 2013
unconditionally and irrevocably guaranteed by
PCCW-HKT TELEPHONE LIMITED
SUPPLEMENTAL AGENCY AGREEMENT
THIS SUPPLEMENTAL AGREEMENT is dated May 12, 2004 and made BETWEEN:
(1) PCCW CAPITAL NO. 3 LIMITED (the "Issuer");
(2) PCCW LIMITED ("PCCW");
(3) PCCW-HKT TELEPHONE LIMITED (the "New Guarantor"); and
(4) DEUTSCHE BANK AG, HONG KONG BRANCH as fiscal agent and principal paying
agent (the "Fiscal Agent").
WHEREAS:
(A) The Issuer, PCCW and the Fiscal Agent entered into an agency agreement
dated 24th January, 2003 (the "Agreement").
(B) PCCW executed a deed of guarantee dated 24th January, 2003 (the "Deed of
Guarantee").
(C) Holders of the Notes passed an Extraordinary Resolution on May 12, 2004
approving the novation of all obligations under the Deed of Guarantee by
PCCW to the New Guarantor and certain amendments to the Conditions; and
authorising the Fiscal Agent to enter into this supplemental agency
agreement (the "Supplemental Agreement").
(D) PCCW and the New Guarantor have executed a deed of novation of even date
(the "Deed of Novation") pursuant to which all obligations of PCCW under
the Deed of Guarantee have been novated to the New Guarantor.
NOW IT IS HEREBY AGREED as follows:
1. INTERPRETATION
Unless the context otherwise requires:-
(a) all capitalised words and expressions used in this Supplemental
Agreement shall have the same meanings as ascribed to them in the
Agreement;
(b) all references in the Agreement (including any Schedule thereto) to
the "Agreement" shall be construed to mean the Agreement as amended
and supplemented pursuant to the terms of this Supplemental
Agreement; and
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(c) all references in the Agreement (including any Schedule thereto) to
the "Guarantor" shall be construed as referring to PCCW-HKT Telephone
Limited; and
(d) all references in the Global Note (dated 24th January, 2003 executed
by the Issuer) to the "Guarantor" shall be construed as referring to
PCCW-HKT Telephone Limited.
2. TRANSFER OF OBLIGATIONS AND RIGHTS
(1) In consideration of the assignment referred to in sub-clause (2) below,
the New Guarantor undertakes to assume and perform all responsibilities,
duties, liabilities and obligations which PCCW contracted to perform under
the Agreement in every way, as if the original responsibilities, duties,
liabilities and obligations had fallen to the New Guarantor, as original
obligor, instead of PCCW. The Fiscal Agent hereby acknowledges, agrees to
accept and consents to such assumption and performance by the New
Guarantor.
(2) PCCW hereby assigns all of its rights and benefits in respect of the
Agreement to the New Guarantor. The Fiscal Agent hereby acknowledges,
agrees and consents to such assignment.
(3) With effect from the date of this Supplemental Agreement, PCCW shall be
completely and absolutely released from all of its responsibilities,
duties, liabilities and obligations under the Agreement and shall cease to
have any rights and benefits under the Agreement.
3. AMENDMENTS TO THE AGREEMENT
From the date of this Supplemental Agreement:
(a) Clause 10(2) of the Agreement shall be deleted;
(b) Clause 23 of the Agreement (relating to notices) shall be deleted and
replaced by Clause 5 of this Supplemental Agreement;
(c) Clause 27 of the Agreement (relating to governing law and
jurisdiction) shall be deleted and replaced by Clause 8 of this
Supplemental Agreement; and
(d) the Conditions, as set out in Part II of Schedule 2 of the Agreement
shall be replaced by the Conditions set out in the Schedule to this
Supplemental Agreement.
4. COPIES AVAILABLE FOR INSPECTION
(1) This Supplemental Agreement and the Deed of Novation shall be deposited
with the Fiscal Agent and shall be held in safe custody by the Fiscal
Agent at its specified office.
(2) The Paying Agents shall hold copies of this Supplemental Agreement and the
Deed of Novation available for inspection by Noteholders and Couponholders
at this specified office during normal business hours. For this purpose,
the Issuer and the Guarantor shall furnish the Paying Agents with
sufficient copies of each of such documents.
5. NOTICES
Any notice required to be given under the Agreement (including this
Supplemental Agreement) to any of the parties shall be delivered in
person, sent by pre-paid post (first class if inland, first class airmail
if overseas) or by facsimile addressed to:
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The Issuer: PCCW Capital Xx. 0 Xxxxxxx
00xx Xxxxx, XXXX Xxxxx
XxxXxx Xxxxx, 000 Xxxx'x Xxxx
Xxxxxx Xxx
Xxxx Xxxx
Facsimile No: x000 0000 0000
(Attention: Company Secretary)
The New Guarantor: PCCW-HKT Telephone Limited
00xx Xxxxx, XXXX Xxxxx
XxxXxx Xxxxx, 000 Xxxx'x Xxxx
Xxxxxx Xxx
Xxxx Xxxx
Facsimile No: x000 0000 0000
(Attention: Company Secretary)
The Fiscal Agent: Deutsche Bank AG, Hong Kong Branch
55th Floor, Xxxxxx Kong Center
0 Xxxxx'x Xxxx Xxxxxxx
Xxxx Xxxx
Facsimile No: x000 0000 0000
(Attention: Trust & Securities Services)
With a copy to: Deutsche Bank AG London
Winchester House
0 Xxxxx Xxxxxxxxxx Xxxxxx
Xxxxxx XX0X 0XX
Facsimile No: x00 000 000 0000
(Attention: Trust & Securities Services)
or such other address of which notice in writing has been given to the
other parties to the Agreement under the provisions of this clause.
Any such notice shall take effect, if delivered in person, at the time of
delivery, if sent by post, three days in the case of inland post or seven
days in the case of overseas post after despatch, and, in the case of
facsimile, the start of the business day in the place of receipt
immediately following, the time of despatch, provided that in the case of
a notice given by facsimile transmission such notice shall forthwith be
confirmed by post. The failure of the addressee to receive such
confirmation shall not invalidate the relevant notice given by facsimile.
6. COUNTERPARTS
This Supplemental Agreement may be executed in any number of counterparts,
all of which, taken together, shall constitute one and the same agreement
and any party may enter into this Supplemental Agreement by executing a
counterpart.
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7. DESCRIPTIVE HEADINGS
The descriptive headings in this Supplemental Agreement are for
convenience of reference only and shall not define or limit the provisions
of this Supplemental Agreement.
8. GOVERNING LAW AND SUBMISSION TO JURISDICTION
(1) The provisions of the Agreement (including this Supplemental Agreement)
are governed by, and shall be construed in accordance with, English law.
(2) Each of the Issuer and the New Guarantor irrevocably agrees for the
benefit of the Paying Agents that the courts of England are to have
jurisdiction to settle any dispute which may arise out of or in connection
with the Agreement (including this Supplemental Agreement) and that
accordingly any suit, action or proceedings arising out of or in
connection with the Agreement (together referred to as "Proceedings") may
be brought in the courts of England.
(3) Each of the Issuer and the New Guarantor irrevocably and unconditionally
waives and agrees not to raise any objection which it may have now or
subsequently to the laying of the venue of any Proceedings in the courts
of England and any claim that any Proceedings have been brought in an
inconvenient forum and further irrevocably and unconditionally agrees that
a judgment in any Proceedings brought in the courts of England shall be
conclusive and binding upon the Issuer and may be enforced in the courts
of any other jurisdiction.
(4) Nothing in this clause shall limit any right to take Proceedings against
the Issuer in any other court of competent jurisdiction, nor shall the
taking of Proceedings in one or more jurisdictions preclude the taking of
Proceedings in any other jurisdiction, whether concurrently or not.
(5) Each of the Issuer and the New Guarantor irrevocably and unconditionally
appoints RB Secretariat Limited at its registered office for the time
being (currently at 10th Floor, Beaufort House, 00 Xx. Xxxxxxx Xxxxxx,
Xxxxxx XX0X 0XX, Xxxxxxx) as its agent for service of process in England
in respect of any Proceedings and undertakes that in the event of it
ceasing so to act it will appoint another person with a registered office
in London as its agent for that purpose.
(6) Each of the Issuer and the New Guarantor:
(a) agrees to procure that, so long as any of the Notes remains liable to
prescription, there shall be in force an appointment of such a person
with an office in London with authority to accept service as
aforesaid;
(b) agrees that failure by any such person to give notice of such service
of process to the Issuer or the New Guarantor shall not impair the
validity of such service or of any judgment based thereon;
(c) consents to the service of process in respect of any Proceedings by
the airmailing of copies, postage prepaid, to the Issuer or the New
Guarantor (as the case may be) in accordance with clause 5 of this
Supplemental Agreement; and
(d) agrees that nothing in the Agreement (including this Supplemental
Agreement) shall affect the right to serve process in any other
manner permitted by law.
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9. CONTRACTS (RIGHTS OF THIRD PARTIES) ACT 1999
A person who is not a party to this Supplemental Agreement has no right
under the Contracts (Rights of Third Parties) Xxx 0000 to enforce any
terms of this Supplemental Agreement, but this does not affect any right
or remedy of a third party which exists or is available apart from that
Act.
SIGNED by each of the parties (or their duly authorised representatives) on the
date which appears first on page 1.
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SCHEDULE
CONDITIONS OF THE NOTES
The U.S.$456,000,000 7.88 per cent. Guaranteed Notes due 2013 (the "Notes",
which expression shall in these Conditions, unless the context otherwise
requires, include any further notes issued pursuant to Condition 15 and forming
a single series with the Notes) of PCCW Capital No.3 Limited (the "Issuer") are
issued subject to and with the benefit of an Agency Agreement dated 24th
January, 2003 made between the Issuer, PCCW Limited ("PCCW") and Deutsche Bank
AG, Hong Kong Branch as fiscal agent and principal paying agent (the "Fiscal
Agent") and any other paying agents appointed from time to time pursuant
thereto (together with the Fiscal Agent, the "Paying Agents"), as amended and
supplemented pursuant to a supplemental agency agreement dated May 12, 2004
made between the Issuer, PCCW, PCCW-HKT Telephone Limited (the "Guarantor") and
the Fiscal Agent (together, the "Agency Agreement", which expression shall
include such further amendments or supplements thereto or restatements thereof
as exist from time to time).
The statements in these Conditions include summaries of, and are subject to,
the detailed provisions of and definitions in the Agency Agreement. Copies of
the Agency Agreement are available for inspection during normal business hours
by the holders of the Notes (the "Noteholders") and the holders of the interest
coupons appertaining to the Notes (the "Couponholders" and the "Coupons",
respectively) at the specified office of each of the Paying Agents. The
Noteholders and the Couponholders are entitled to the benefit of, are bound by,
and are deemed to have notice of, all the provisions of the Agency Agreement
applicable to them. References in these Conditions to the Fiscal Agent and the
Paying Agents shall include any successor appointed under the Agency Agreement.
1. FORM, DENOMINATION AND TITLE
(1) Form and Denomination
The Notes are in bearer form, serially numbered, in the denomination of
U.S.$250,000 with Coupons attached on issue.
(2) Title
Title to the Notes and to the Coupons will pass by delivery.
(3) Holder Absolute Owner
The Issuer, the Guarantor and any Paying Agent may (to the fullest extent
permitted by applicable laws) deem and treat the holder of any Note or
Coupon as the absolute owner for all purposes (whether or not the Note or
Coupon shall be overdue and notwithstanding any notice of ownership or
writing on the Note or Coupon or any notice of previous loss or theft of
the Note or Coupon).
2. STATUS OF THE NOTES
The Notes and the Coupons constitute direct, unconditional and (subject to
the provisions of Condition 4(1)) unsecured obligations of the Issuer and
(subject as provided above) rank and will rank pari passu, without any
preference among themselves, with all other outstanding
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unsecured and unsubordinated obligations of the Issuer, present and
future, save for such obligations as may be preferred by mandatory
provisions of applicable law.
3. GUARANTEE
PCCW executed a deed of guarantee (the "Deed of Guarantee") dated 24th
January, 2003. Pursuant to the authority of an Extraordinary Resolution of
Noteholders passed at a meeting of the Noteholders held on May 12, 2004,
all obligations under the Deed of Guarantee have, by virtue of a deed of
novation (the "Deed of Novation") dated May 12, 2004, been novated by PCCW
to the Guarantor. Pursuant to the Deed of Guarantee, as novated, the
Guarantor unconditionally and irrevocably guarantees (the "Guarantee") the
due and punctual payment of the principal of and interest on the Notes as
and when the same shall become due and payable, together with any
additional amounts in respect of the Notes payable pursuant to Condition
8. The obligations of the Guarantor under the Guarantee constitute direct,
unconditional and (subject to the provisions of Condition 4(1)) unsecured
obligations of the Guarantor and (subject as provided above) rank and will
rank pari passu with all other outstanding unsecured and unsubordinated
obligations of the Guarantor, present and future, save for such
obligations as may be preferred by mandatory provisions of applicable law.
The originals of the Deed of Guarantee and the Deed of Novation are held
by the Fiscal Agent on behalf of, and copies are available for inspection
by, the Noteholders and Couponholders at its specified office during
normal business hours.
4. NEGATIVE PLEDGE
(1) Negative Pledge
For so long as any of the Notes remains outstanding, neither the Issuer
nor the Guarantor will, and the Guarantor will procure that none of the
Principal Subsidiaries (other than Listed Principal Subsidiaries) will,
create, incur, assume or permit to exist any Lien (other than Permitted
Liens) upon any of their respective property or assets, owned as at 24th
January, 2003 (the "Issue Date") or as have been or may be acquired after
the Issue Date, to secure any Indebtedness of the Guarantor or such
Principal Subsidiaries (or any guarantee or indemnity in respect thereof)
without, in any such case, making effective provision whereby the Notes
will be secured either at least equally and rateably with such
Indebtedness or by such other Lien as shall have been approved by an
Extraordinary Resolution of the Noteholders for so long as such
Indebtedness will be so secured, unless, after giving effect thereto, the
aggregate outstanding principal amount of all such secured Indebtedness
(excluding that of Listed Principal Subsidiaries and their respective
Subsidiaries and Indebtedness secured by Permitted Liens) entered into
after the Issue Date would not exceed 50 per cent. of the Guarantor's
Adjusted Consolidated Net Worth.
(2) Interpretation
For the purposes of these Conditions:
"Adjusted Consolidated Net Worth" means the sum of (a) all amounts paid up
(or credited as paid up) on all classes of the Guarantor's issued share
capital, revenue or capital reserves, capital contribution, or any other
accounts that are included as shareholders' funds under generally accepted
accounting principles and practices in Hong Kong ("HK GAAP") and (b) the
aggregate outstanding principal amount of Subordinated Indebtedness;
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"Principal Subsidiary" at any time shall mean a Subsidiary of the
Guarantor:
(i) as to which one or more of the following conditions is satisfied:
(a) its net profit or (in the case of a Subsidiary of the
Guarantor which has Subsidiaries) consolidated net profit
attributable to the Guarantor (in each case before taxation
and exceptional items) is at least 5 per cent. of the
consolidated net profit of the Guarantor and its
Subsidiaries (before taxation and exceptional items but
after deducting minority interests in Subsidiaries); or
(b) its net assets or (in the case of a Subsidiary of the
Guarantor which has Subsidiaries) consolidated net assets
attributable to the Guarantor (in each case after deducting
minority interests in Subsidiaries) are at least 5 per
cent. of the consolidated net assets (after deducting
minority interests in Subsidiaries) of the Guarantor and
its Subsidiaries;
all as calculated by reference to the then latest audited
financial statements (consolidated or, as the case may be,
unconsolidated) of the Subsidiary of the Guarantor and the then
latest audited consolidated financial statements of the Guarantor
provided that: (1) in the case of a Subsidiary of the Guarantor
acquired after the end of the financial period to which the then
latest relevant audited accounts relate, the reference to the
then latest audited accounts for the purposes of the calculation
above shall, until audited accounts for the financial period in
which the acquisition is made are published, be deemed to be a
reference to the accounts adjusted to consolidate the latest
audited accounts of the Subsidiary in the accounts; (2) if, in
the case of a Subsidiary of the Guarantor which itself has one or
more Subsidiaries, no consolidated accounts are prepared and
audited, its consolidated net assets and consolidated net profits
shall be determined on the basis of pro forma consolidated
accounts of the relevant Subsidiary and its Subsidiaries prepared
for this purpose by its auditors; (3) if the accounts of a
Subsidiary of the Guarantor (not being a Subsidiary referred to
in (1) above) are not consolidated with those of the Guarantor
then the determination of whether or not the Subsidiary of the
Guarantor is a Principal Subsidiary shall, if the Guarantor
requires, be based on a pro forma consolidation of its accounts
(consolidated, if appropriate) with the consolidated accounts of
the Guarantor and its Subsidiaries; or
(ii) to which is transferred all or substantially all of the assets of
a Subsidiary of the Guarantor which immediately prior to the
transfer is a Principal Subsidiary, provided that, with effect
from such transfer, the Subsidiary which so transfers its assets
and undertakings shall cease to be a Principal Subsidiary (but
without prejudice to paragraph (i) above) and the Subsidiary of
the Guarantor to which the assets are so transferred shall
forthwith upon such transfer become a Principal Subsidiary.
A certificate of the auditors of the Guarantor as to whether or not a
Subsidiary is a Principal Subsidiary shall be conclusive and binding on
all parties in the absence of manifest error;
"Indebtedness" of any Person means any indebtedness for or in respect of
money borrowed that has a final maturity of one year or more from its
date of incurrence or issuance and that is evidenced by any agreement or
other instrument, excluding trade payables; provided, however, that for
the purposes of determining the amount of Indebtedness of the Guarantor
or any of its Subsidiaries outstanding at any relevant time, the amount
included as Indebtedness
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of the Guarantor or such Subsidiary in respect of finance leases shall
be the net amount from time to time properly characterised as
"obligations under finance leases" in accordance with HK GAAP;
"Lien" means any mortgage, charge, pledge, lien, encumbrance,
hypothecation, title retention, security interest or security
arrangement of any kind;
"Listed Principal Subsidiary" means any Principal Subsidiary, the shares
of which are at the relevant time listed on The Stock Exchange of Hong
Kong Limited or any other recognised stock exchange;
"Permitted Liens" means:
(i) Liens existing on or prior to the Issue Date;
(ii) Liens for taxes or assessments or other applicable governmental
charges or levies;
(iii) Liens created or arising by operation of law or created in the
ordinary course of business, including, but not limited to,
landlords' liens and statutory liens of carriers, warehousemen,
mechanics, materialmen, vendors and other liens securing amounts
which are not more than 60 days overdue or which are being
contested in good faith;
(iv) Liens incurred or deposits made in the ordinary course of
business in connection with workers' compensation, unemployment
insurance and other types of social security or to secure the
performance of tenders, statutory obligations, surety and appeal
bonds, bids, leases, government contracts or undertakings,
performance and return of money bonds, interconnection, access or
resale agreements with other telecommunications companies or
organisations, and similar obligations;
(v) easements, rights-of-way, zoning and similar restrictions and
other similar charges or encumbrances not interfering with the
ordinary conduct of the business of the Guarantor and any
Principal Subsidiaries;
(vi) Liens created on any property or assets acquired, leased or
developed (including improved, constructed, altered or repaired)
after the Issue Date; provided, however, that (i) any such Lien
shall be confined to the property or assets acquired, leased or
developed (including improved, constructed, altered or repaired);
(ii) the principal amount of the debt encumbered by such Lien
shall not exceed the cost of the acquisition or development of
such property or assets or any improvements thereto (including
any construction, repair or alteration) or thereon and (iii) any
such Lien shall be created concurrently with or within three
years following the acquisition, lease or development (including
construction, improvement, repair or alteration) of such property
or assets;
(vii) rights of setoff of a financial institution with respect to
deposits or other accounts of the Guarantor or any Principal
Subsidiary held by such financial institution in an amount not to
exceed the aggregate amount owed to such financial institution by
the Guarantor or such Principal Subsidiary, as the case may be;
(viii) Liens on documents and the goods they represent in connection
with letters of credit, trade finance and similar transactions
entered into in the ordinary course of business;
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(ix) Liens arising in connection with industrial revenue, development
or similar bonds or other indebtedness or means of project
financing (provided that the Liens arising in connection with
such industrial revenue, development or similar bonds or other
indebtedness or means of project financing do not exceed the
value of the project financed and are limited to the project
financed);
(x) Liens in favour of the Guarantor or any Principal Subsidiary;
(xi) leases, subleases, licenses and sublicenses granted to third
parties in the ordinary course of business;
(xii) attachment, judgment and other similar Liens arising in
connection with court proceedings which are effectively stayed
while the underlying claims are being contested in good faith by
appropriate proceedings;
(xiii) any Lien against any property or assets of a Person existing at
the time such Person becomes a Principal Subsidiary or arising
after such acquisition pursuant to contractual commitments
entered into prior to and not in contemplation of such
acquisition;
(xiv) any Lien existing on any property or assets prior to the
acquisition thereof, which Lien was not created in connection
with the acquisition thereof, except for Liens permitted pursuant
to clause (vi) above;
(xv) Liens on any property or assets of the Guarantor or any Principal
Subsidiary in favour of any government or any subdivision
thereof, securing the obligations of the Guarantor or such
Principal Subsidiary under any contract or payment owed to such
governmental entity pursuant to applicable laws, rules,
regulations or statutes;
(xvi) Liens created in connection with any sale/leaseback transaction;
(xvii) any renewal or extension of any of the Liens described in the
foregoing clauses which is limited to the original property or
assets covered thereby; or
(xviii) Liens in respect of Indebtedness with respect to which the
Guarantor or any Principal Subsidiary has paid money or deposited
money or securities with a fiscal agent, trustee or depository to
pay or discharge in full the obligations of the Guarantor and its
Subsidiaries in respect thereof (other than the obligations that
such money or securities so paid or deposited, and the proceeds
therefrom, be sufficient to pay or discharge such obligations in
full);
"Person" means any individual, corporation, partnership, joint venture,
association, joint stock company, trust, unincorporated organisation,
government or any agency or political subdivision thereof or any other
entity;
"Subordinated Indebtedness" means the principal amount of Indebtedness
of the Guarantor (including perpetual debt, which the Guarantor is not
required to repay) which (i) has a final maturity and a weighted average
life to maturity longer than the maturity of the Notes and (ii) is
issued or assumed pursuant to, or evidenced by, an indenture, other
instrument or agreement containing provisions for the subordination of
such Indebtedness to the Notes including (x) a provision that, in the
event of any bankruptcy, insolvency or other similar proceeding in
respect of the Guarantor, the holders of the Notes shall be entitled to
receive
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payment in full in cash of all principal, Additional Amounts (as defined
below) and interest on the Notes (including all interest arising after
the commencement of such proceeding whether or not an allowed claim in
such proceeding) before the holder or holders of any such Subordinated
Indebtedness shall be entitled to receive any payment of principal,
interest or premium thereon, (y) a provision that, if an Event of
Default has occurred and is continuing under the Notes, the holder or
holders of any such Subordinated Indebtedness shall not be entitled to
payment of any principal, interest or premium in respect thereof unless
or until such Event of Default shall have been cured or waived or shall
have ceased to exist, and (z) a provision that the holder or holders of
such Subordinated Indebtedness may not accelerate the maturity thereof
as a result of any default relating thereto so long as any Note is
outstanding; and
"Subsidiary" means, in relation to any company, any company or other
business entity of which the first-named company owns or controls
(either directly or through one or more other Subsidiaries) more than 50
per cent. of the issued share capital, or other ownership interest,
giving ordinary voting power to elect directors, managers or trustees of
such company or other business entity, or any company or other business
entity which at any time has its accounts consolidated with those of the
first-named company or which, under Hong Kong law or regulations and
under HK GAAP from time to time, should have its accounts consolidated
with those of the first-named company.
5. INTEREST
(1) Interest Rate and Interest Payment Dates
The Notes bear interest from (and including) the Issue Date at the rate
of 7.88 per cent. per annum, payable semi-annually in arrear in equal
instalments on 24th January and 24th July of each year (each an "Interest
Payment Date"). The first payment, for the period from and including 24th
January, 2003 to but excluding 24th July, 2003 and amounting to
U.S.$9,850 per U.S.$250,000 principal amount of Notes, shall be made on
24th July, 2003.
The period from (and including) the Issue Date to (but excluding) the
first Interest Payment Date and each successive period from (and
including) an Interest Payment Date to (but excluding) the next
succeeding Interest Payment Date is herein referred to as an "Interest
Period".
(2) Interest Accrual
Each Note will cease to bear interest from (and including) its due date
for redemption unless, upon due presentation, payment of the principal in
respect of the Note is improperly withheld or refused or unless default
is otherwise made in respect of payment. In such event, interest will
continue to accrue until whichever is the earlier of:
(a) the date on which all amounts due in respect of such Note have
been paid; and
(b) five days after the date on which the full amount of the moneys
payable in respect of such Notes has been received by the Fiscal
Agent and notice to that effect has been given to the Noteholders
in accordance with Condition 12.
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(3) Calculation of Broken Interest
When interest is required to be calculated in respect of a period ending
other than on an Interest Payment Date, it shall be calculated on the
basis of a 360-day year consisting of 12 months of 30 days each and, in
the case of an incomplete month, the number of days elapsed on the basis
of a month of 30 days.
6. PAYMENTS
(1) Payments in respect of Notes
Payments of principal and interest in respect of each Note will be made
against presentation and surrender (or, in the case of part payment only,
endorsement) of such Note, except that payments of interest due on an
Interest Payment Date will be made against presentation and surrender
(or, in the case of part payment only, endorsement) of the relevant
Coupon, in each case only at the specified office outside the United
States of any of the Paying Agents.
(2) Method of Payment
Payments will be made by credit or transfer to an account in U.S. dollars
maintained by the payee, or, at the option of the payee, by a cheque in
U.S. dollars drawn on a bank in New York City.
(3) U.S. Paying Agents
Notwithstanding the foregoing, payments will be made at the specified
office in the United States of any Paying Agent and (if no such
appointment is then in effect) the Issuer shall appoint and maintain a
Paying Agent with a specified office in New York City at which payments
will be made:
(a) if (i) the Issuer has appointed Paying Agents with specified
offices outside the United States with the reasonable expectation
that the Paying Agents would be able to make payment at the
specified offices outside the United States of the full amount
payable with respect to the Notes in the manner provided above
when due, (ii) payment of the full amount due in U.S. dollars at
all specified offices of the Paying Agents outside the United
States is illegal or effectively precluded by exchange controls or
other similar restrictions and (iii) the payment is then permitted
under United States law; or
(b) at the option of the relevant holder, if the payment is then
permitted under United States law without involving, in the
opinion of the Issuer, adverse tax consequences for the Issuer or
the Guarantor.
(4) Missing Unmatured Coupons
Each Note should be presented for payment together with all relative
unmatured Coupons, failing which the full amount of any relative missing
unmatured Coupon (or, in the case of payment not being made in full, that
proportion of the full amount of the missing unmatured Coupon which the
amount so paid bears to the total amount due) will be deducted from the
amount due for payment. Each amount so deducted will be paid in the
manner mentioned above against presentation and surrender (or, in the
case of part payment only, endorsement) of the relative missing Coupon at
any time before the expiry of 10 years after the Relevant Date (as
defined in Condition 8) in respect of the relevant Note (whether or not
the Coupon
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would otherwise have become void pursuant to condition 9) or, if later,
five years after the date on which the Coupon would have become due, but
not thereafter.
(5) Payments subject to Applicable Laws
Payments in respect of principal and interest on the Notes are subject in
all cases to any fiscal or other laws and regulations applicable in the
place of payment, but without prejudice to the provisions of Condition 8.
(6) Payment only on a Presentation Date
A holder shall be entitled to present a Note or Coupon for payment only
on a Presentation Date and shall not, except as provided in Condition 5,
be entitled to any further interest or other payment if a Presentation
Date is after the due date.
"Presentation Date" means a day which (subject to Condition 9):
(a) is or falls after the relevant due date;
(b) is a Business Day in the place of the specified office of the
Paying Agent at which the Note or Coupon is presented for payment;
and
(c) in the case of payment by credit or transfer to a U.S. dollar
account in New York City as referred to above), is a Business Day
in New York City.
In this Condition, "Business Day" means, in relation to any place, a day
(other than a Saturday or Sunday) on which commercial banks and foreign
exchange markets settle payments and are open for general business
(including dealing in foreign exchange and foreign currency deposits) in
that place.
(7) Initial Paying Agents
The names of the initial Paying Agents and their initial specified
offices are set out at the end of these Conditions. The Issuer reserves
the right at any time to vary or terminate the appointment of any Paying
Agent and to appoint additional or other Paying Agents provided that (a)
it will at all times maintain a Fiscal Agent having its specified office
in Hong Kong, (b) if any European Union Directive on the taxation of
savings implementing the conclusions of the ECOFIN Council Meeting of
26th-27th November, 2000 or any law implementing or complying with, or
introduced in order to conform to, such Directive is introduced, the
Issuer will ensure it maintains a Paying Agent in a European Union Member
State that will not be obliged to withhold or deduct tax pursuant to any
such Directive, (c) if any Notes are listed on the Luxembourg Stock
Exchange or any other stock exchange, it will at all times maintain a
Paying Agent having its specified office in Luxembourg, or, as the case
may be, in such place as may be required by the rules and regulations of
any other relevant stock exchange (or any other relevant authority) and
(d) the specified office of a Paying Agent shall not be located within
the United States. Notice of any termination or appointment and of any
changes in specified offices shall be given to the Noteholders promptly
by the Issuer in accordance with Condition 12.
The Agents shall act solely as Agent of the Issuer and will not thereby
assume any obligations towards or relationship of agency or trust for or
with any of the owners or holders of Notes or Coupons.
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7. REDEMPTION AND PURCHASE
(1) Redemption at Maturity
Unless previously redeemed or purchased and cancelled as provided below,
the Issuer will redeem the Notes at their principal amount on 24th
January, 2013.
(2) Redemption for Taxation Reasons
If (a) as a result of any change in, or amendment to, the laws or
regulations of a Relevant Jurisdiction (as defined in Condition 8), or
any change in the official interpretation of the laws or regulations of a
Relevant Jurisdiction, which change or amendment becomes effective after
24th January, 2003 on the next Interest Payment Date (i) the Issuer is or
would be required to pay Additional Amounts (as defined in Condition 8)
as provided or referred to in Condition 8; or (ii) the Guarantor would be
unable for reasons outside its control to procure payment by the Issuer
and in making payment itself would be required to pay such Additional
Amounts; or (iii) the Guarantor or any of its Subsidiaries has or will
become obliged to pay any Additional Amounts in respect of the
Intercompany Loan (as defined in Condition 8) and (b) the requirement
cannot be avoided by the Issuer, the Guarantor or any of such
Subsidiaries, as the case may be, taking reasonable measures available to
it provided that such measures do not involve the Issuer, the Guarantor
or such Subsidiary incurring material expenses, the Issuer may at its
option, having given not less than 30 nor more than 60 days' notice to
the Noteholders in accordance with Condition 12 (which notice shall be
irrevocable), redeem all the Notes, but not some only, at any time at
their principal amount together with interest accrued to (but excluding)
the date of redemption, provided that no notice of redemption shall be
given earlier than 90 days before the earliest date on which the Issuer,
the Guarantor or such Subsidiary of the Guarantor, as the case may be,
would be required to pay such Additional Amounts were a payment in
respect of the Notes then due. Prior to the publication of any notice of
redemption pursuant to this paragraph, the Issuer shall deliver to the
Fiscal Agent a certificate signed by two Directors of the Issuer, the
Guarantor or such Subsidiary of the Guarantor, as the case may be,
stating that the requirement referred to in (a) above will apply on the
next Interest Payment Date and cannot be avoided by the Issuer, the
Guarantor or such Subsidiary of the Guarantor, as the case may be, taking
reasonable measures available to it provided that such measures do not
involve the Issuer, the Guarantor or such Subsidiary incurring material
expenses and an opinion of independent legal advisers of recognised
standing to the effect that the Issuer, the Guarantor or such Subsidiary
of the Guarantor, as the case may be, has or will become obliged to pay
such Additional Amounts as a result of the change or amendment.
(3) Redemption at the Option of the Issuer
The Issuer may give:
(a) not less than 30 nor more than 60 days' notice to the Noteholders
in accordance with Condition 12; and
(b) not less than 15 days before the giving of the notice referred to
in (a), notice to the Fiscal Agent
(which notices shall be irrevocable and shall specify the date fixed for
redemption), to redeem all (but not some only) of the Notes on any
Interest Payment Date during the period
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commencing on 24th January, 2007 and ending on 24th January, 2010 (both
dates inclusive) at their principal amount. Upon the expiry of such
notice, the Issuer shall be obliged to redeem the Notes.
(4) [intentionally blank]
(5) Redemption at the Option of the Holders
(a) Early Redemption
In the event that the Notes have not been previously redeemed, upon any
Noteholder giving to the Issuer not less than 30 nor more than 60 days'
notice expiring on 24th January, 2010 (or expiring on any Interest
Payment Date thereafter), the Issuer will redeem in whole (but not in
part) the Notes the subject of the notice on such Interest Payment Date,
at their principal amount.
(b) Exercise
To exercise the right to require redemption of any Notes under this
Condition 7(5), the holder of the Notes must deliver at the specified
office of any Paying Agent on any Business Day (as defined in Condition
6(6)) in the place of such specified office, a duly signed and completed
notice of exercise in the form (for the time being current and which may,
if this Note is held in a clearing system, be any form acceptable to the
clearing system delivered in any manner acceptable to the clearing
system) obtainable from any specified office of any Paying Agent (a "Put
Notice") and in which the holder must specify a bank account (or, if
payment is required to be made by cheque, and address) to which payment
is to be made under this Condition accompanied by such Notes or evidence
satisfactory to the Paying Agent concerned that such Notes will,
following the delivery of the Put Notice, be held to its order or under
its control. A Put Notice given by a holder of any Note shall be
irrevocable except where, prior to the due date of redemption, an Event
of Default has occurred and be continuing, in which event such holder, at
its option, may elect by notice to the Issuer to withdraw the Put Notice
and instead to give notice that the Note is immediately due and repayable
under Condition 10.
(6) Purchases
The Issuer, the Guarantor or any of the Guarantor's Subsidiaries (as
defined above) may at any time purchase Notes (provided that all
unmatured Coupons appertaining to the Notes are purchased with the Notes)
in any manner and at any price. If purchases are made by tender, tenders
must be available to all Noteholders alike.
(7) Cancellations
All Notes which are (a) redeemed or (b) purchased by or on behalf of the
Issuer, the Guarantor or any of the Guarantor's Subsidiaries will
forthwith be cancelled, together with all relative unmatured Coupons
attached to the Notes or surrendered with the Notes, and accordingly may
not be reissued or resold.
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(8) Notices Final
Upon the expiry of any notice as is referred to in paragraph (2), (3) or
(5) above the Issuer shall be bound to redeem the Notes to which the
notice refers in accordance with the terms of such paragraph.
8. TAXATION
(1) Payment without Withholding
All payments in respect of the Notes by or on behalf of the Issuer or the
Guarantor and all payments made by PCCW or any of its Subsidiaries in
respect of the inter-company loans of the proceeds of the offering of the
Notes from the Issuer to PCCW or any of its Subsidiaries (collectively,
the "Intercompany Loan") shall be made without withholding or deduction
for, or on account of, any present or future taxes, duties, assessments
or governmental charges of whatever nature imposed or levied by or on
behalf of any of the Relevant Jurisdictions ("Taxes"), unless such
withholding or deduction of the Taxes is required by law. In that event,
the Issuer, PCCW or such Subsidiary of PCCW (whether, the Guarantor, or
another subsidiary of PCCW), as the case may be, will pay such additional
amounts ("Additional Amounts") as may be necessary in order that the net
amounts received by the Noteholders and Couponholders or in connection
with the Intercompany Loan after such withholding or deduction shall
equal the respective amounts which would have been receivable in respect
of the Notes, the Coupons or in connection with the Intercompany Loan, as
the case may be, in the absence of such withholding or deduction; except
that no Additional Amounts shall be payable in relation to any payment in
respect of any Note or Coupon:
(a) to, or to a third party on behalf of, a holder who is liable to
the Taxes in respect of the Note or Coupon by reason of his having
some connection with a Relevant Jurisdiction other than the mere
holding of the Note or Coupon or receiving principal or interest
in respect thereof; or
(b) presented for payment more than 30 days after the Relevant Date
(as defined below) except to the extent that a holder would have
been entitled to Additional Amounts on presenting the same for
payment on the last day of such period of 30 days assuming that
day to have been a Presentation Date; or
(c) where such withholding or deduction is imposed on a payment to an
individual and is required to be made pursuant to any European
Union Directive on the taxation of savings implementing the
conclusions of the ECOFIN Council meeting of 26th to 27th
November, 2000 or any law implementing or complying with, or
introduced in order to conform, to such Directive; or
(d) presented for payment by or on behalf of a Noteholder or
Couponholder who would have been able to avoid such withholding or
deduction by presenting the relevant Note or Coupon, as the case
may be, to another Paying Agent in a European Union Member State;
or
(e) in respect of any such Taxes that would not have been so imposed,
deducted or withheld if the holder or beneficial owner of a Note
or the beneficial owner of any payment on such Note had (i) made a
declaration of non-residence or any other claim or filing for
exemption to which it is entitled or (ii) complied with any
certification,
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identification, information, documentation or other reporting
requirement concerning the nationality, residence, identity or
connection with a Relevant Jurisdiction of such holder or
beneficial owner of such Note or any payment on such Note
(provided that (x) such declaration of non-residence or other
claim or filing for exemption or such compliance is required by
the applicable law of a Relevant Jurisdiction as a precondition to
exemption from, or reduction in the rate of the imposition,
deduction or withholding of, such Taxes and (y) at least 30 days
prior to the first payment date with respect to which such
declaration of non-residence or other claim or filing for
exemption or such compliance is required under the applicable law
of a Relevant Jurisdiction, the holder or the beneficial owner, as
the case may be, of such Note at that time has been notified by
the Issuer or any other person through whom payment may be made
that a declaration of non-residence or other claim or filing for
exemption or such compliance is required to be made); or
(f) in respect of any payment under or with respect to a Note to any
holder that is a fiduciary or partnership or any person other than
the sole beneficial owner of such payment or Note, to the extent
that a beneficiary or settlor with respect to such fiduciary, a
member of such a partnership or the beneficial owner of such
payment or Note would not have been entitled to such Additional
Amounts had such beneficiary, settlor, member or beneficial owner
been the actual holder of such Note; or
(g) in respect of any estate, inheritance, gift, sales, excise,
transfer or personal property tax or similar tax, assessment or
governmental charge; or
(h) any combination of items (a) through (g) above.
(2) Interpretation
In these Conditions:
(a) "Relevant Date" means the date on which the payment first becomes
due but, if the full amount of the money payable has not been
received by the Fiscal Agent on or before the due date, it means
the date on which, the full amount of the money having been so
received, notice to that effect shall have been duly given to the
Noteholders by the Issuer in accordance with Condition 12; and
(b) "Relevant Jurisdiction" means the British Virgin Islands or any
political subdivision or any authority thereof or therein having
power to tax, the Hong Kong Special Administrative Region of the
People's Republic of China or any political subdivision or any
authority thereof or therein having power to tax or any other
jurisdiction in which the Issuer, PCCW or such Subsidiary of PCCW
(whether the Guarantor, or another subsidiary of PCCW), as the
case may be, is resident for tax purposes from or through which
payments in respect of the Notes or the Intercompany Loan, as the
case may be, are made or any political subdivision or any
authority thereof or therein having power to tax.
(3) Additional Amounts
Any reference in these Conditions to any amounts in respect of the Notes
or the Intercompany Loan shall be deemed also to refer to any Additional
Amounts which may be payable under this Condition.
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9. PRESCRIPTION
Notes and Coupons will become void unless presented for payment within
periods of 10 years (in the case of principal) and five years (in the
case of interest) from the Relevant Date in respect of the Notes or, as
the case may be, the Coupons, subject to the provisions of Condition 6.
10. EVENTS OF DEFAULT
The holder of any Note may give notice to the Issuer that the Note is,
and it shall accordingly forthwith become, immediately due and repayable
at its principal amount, together with interest accrued to the date of
repayment, if any of the following events ("Events of Default") shall
have occurred and be continuing:
(a) failure to pay principal of any Note within five Business Days in
Hong Kong and New York after the due date for such payment; or
(b) failure to pay interest on any Note within 30 Business Days in
Hong Kong and New York after the due date for such payment; or
(c) failure to perform any other covenant or agreement of the Issuer
or the Guarantor in the Agency Agreement, the Guarantee or the
Notes and (except where the failure is incapable of remedy when no
continuation or notice as is hereinafter mentioned will be
required) such failure continues for 60 days after there has been
given by registered or certified mail, to the Issuer or the
Guarantor by the Fiscal Agent (as instructed by the relevant
Noteholder) or by the relevant Noteholder, a written notice
specifying such failure and requiring it to be remedied; or
(d) (i) failure to pay upon final maturity (after giving effect to the
expiration of any applicable grace period therefor) the principal
of any Indebtedness of the Issuer, the Guarantor or any Principal
Subsidiary, (ii) acceleration of the maturity of any Indebtedness
of the Issuer, the Guarantor or any Principal Subsidiary following
a default by the Issuer, the Guarantor or such Principal
Subsidiary unless such Indebtedness is discharged or such
acceleration is annulled within 10 days of the due date or date of
acceleration, or (iii) failure to pay any amount payable by the
Issuer, the Guarantor or any Principal Subsidiary under any
guarantee or indemnity in respect of any Indebtedness of any other
Person unless such obligation is discharged or otherwise satisfied
within 10 days of the due date; provided, however, that no such
event set forth in (i), (ii) or (iii) above shall constitute an
Event of Default unless the aggregate Indebtedness to which all
such events relate exceeds US$30,000,000 (or its equivalent in any
other currency) (the "Specified Limit"); or
(e) the Issuer, the Guarantor or any Principal Subsidiary becomes
insolvent and is unable to pay its debts as they fall due, stops,
suspends or threatens to stop or suspend payment of all or a
material part of its debts, begins negotiations or takes any
proceeding or other step with a view to readjustment, rescheduling
or deferral of all of its Indebtedness (or any part of its
Indebtedness which it will or might otherwise be unable to pay
when due) or proposes or makes a general assignment or any
arrangement or composition with or for the benefit of its
creditors or a moratorium is agreed or declared in respect of or
affecting all or a material part of the Indebtedness of the
Issuer, the Guarantor or any Principal Subsidiary or of the Issuer
or the Guarantor and their respective Subsidiaries taken as a
whole; or
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(f) distress, attachment, execution or other legal process is levied,
enforced or sued out on or against all or any material part of the
assets of the Issuer, the Guarantor or any Principal Subsidiary in
respect of which the cost or loss to the relevant company or the
amount claimed against the relevant company exceeds the Specified
Limit and is not discharged or stayed within 30 days (or such
longer period as the holders of a majority in principal amount of
the Notes may permit) unless and for so long as it is being
contested in good faith and diligently by the Issuer, the
Guarantor or Principal Subsidiary, as the case may be; or
(g) any present or future encumbrance on or over all or any material
part of the assets of the Issuer, the Guarantor or any Principal
Subsidiary becomes enforceable and any step (including the taking
of possession or the appointment of a receiver, manager or similar
officer) is taken to enforce that encumbrance; or
(h) any bona fide step is taken by any person for the dissolution of
the Issuer, the Guarantor or any Principal Subsidiary (except for
the purpose of and followed by a reconstruction or amalgamation on
terms approved by the holders of a majority in principal amount of
the Notes before that step is taken or in the case of a Principal
Subsidiary whereby the undertaking and assets of the Principal
Subsidiary are transferred or otherwise vested in the Guarantor or
another of its Subsidiaries pursuant to a merger of the Principal
Subsidiary with the Guarantor or such other Subsidiary or by way
of a voluntary winding-up or dissolution where there are surplus
assets in any such Principal Subsidiary and such surplus assets
attributable to the Guarantor and/or any other Subsidiary are
distributed to the Guarantor and/or such other Subsidiary); or
(i) the Issuer ceases to be a direct or indirect wholly-owned
Subsidiary of PCCW; or
(j) the Issuer carries on any business activity whatsoever other than
in connection with the Notes or incurs any Indebtedness (other
than to the Guarantor or the Guarantor's Subsidiaries and carries
on any activities in connection therewith, including without
limitation entering into any hedging or derivative transaction in
connection with the Intercompany Loan or otherwise) or makes any
issue of bonds, notes, debenture stock, loan stock, or other debt
securities of any kind other than the Notes; or
(k) any event occurs which under the laws of any relevant jurisdiction
has an analogous or equivalent effect to any of the events
referred to in paragraphs (e) through (h) above; or
(l) if the Guarantee ceases to be, or is claimed by the Guarantor not
to be, in full force and effect.
11. REPLACEMENT OF NOTES AND COUPONS
Should any Note or Coupon be lost, stolen, mutilated, defaced or
destroyed it may be replaced at the specified office outside the United
States of the Fiscal Agent, upon payment by the claimant of the expenses
incurred in connection with the replacement and on such terms as to
evidence and indemnity as the Issuer may reasonably require. Mutilated or
defaced Notes or Coupons must be surrendered before replacements will be
issued.
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12. NOTICES
(1) Notices to the Noteholders
All notices to the Noteholders will be valid if published in a leading
English language daily newspaper with general circulation in Asia as the
Issuer may decide and, if the Notes are listed on the Luxembourg Stock
Exchange and the rules of that exchange so require, in one daily
newspaper published in Luxembourg. It is expected that publication will
normally be made in the Asian Wall Street Journal and, if appropriate,
the Luxemburger Wort. The Issuer shall also ensure that notices are duly
published in a manner which complies with the rules and regulations of
any stock exchange or other relevant authority on which the Notes are for
the time being listed. Any such notice will be deemed to have been given
on the date of the first publication or, where required to be published
in more than one newspaper, on the date of the first publication in all
required newspaper.
(2) Notices from the Noteholders
Notices to be given by any Noteholder shall be in writing and given by
lodging the same, together with the relative Note or Notes, with the
Fiscal Agent or, if the Notes are held in a clearing system, may be given
through the clearing system in accordance with the standard rules and
procedures.
13. MEETINGS OF NOTEHOLDERS AND MODIFICATION
(1) Provisions for Meetings
The Agency Agreement contains provisions for convening meetings of the
Noteholders to consider any matter affecting their interests, including
the modification by Extraordinary Resolution of these Conditions or the
Guarantee or the provisions of the Agency Agreement. The quorum at any
meeting for passing an Extraordinary Resolution will be one or more
Persons present holding or representing more than 50 per cent. in
principal amount of the Notes for the time being outstanding, or at any
adjourned meeting one or more Persons present whatever the principal
amount of the Notes held or represented by him or them, except that at
any meeting the business of which includes the modification of certain of
these Conditions and provisions of the Agency Agreement the necessary
quorum for passing an Extraordinary Resolution will be one or more
Persons present holding or representing not less than two-thirds, or at
any adjourned meeting not less than one-third, of the principal amount of
the Notes for the time being outstanding. An Extraordinary Resolution
passed at any meeting of the Noteholders will be binding on all
Noteholders, whether or not they are present at the meeting, and on all
Couponholders.
(2) Modification
The Fiscal Agent may agree, without the consent of the Noteholders or
Couponholders, to any modification of any of these Conditions or any of
the provisions of the Agency Agreement either (i) for the purpose of
curing any ambiguity or manifest or proven error or of curing, correcting
or supplementing any defective provision contained herein or therein or
(ii) in any manner which is not materially prejudicial to the interests
of the Noteholders. Any modification shall be binding on the Noteholders
and the Couponholders and, unless the Fiscal Agent agrees otherwise, any
modification shall be notified by the Issuer to the Noteholders as soon
as practicable thereafter in accordance with Condition 12.
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14. CURRENCY INDEMNITY
The Issuer's and the Guarantor's obligations under the Notes to make
all payments in U.S. dollars will not be satisfied by any payment,
recovery or any other realisation of proceeds in any currency other
than U.S. dollars. If, for the purpose of obtaining a judgment in any
court with respect to any obligation of the Issuer or, as the case may
be, the Guarantor under any Notes it shall become necessary to convert
into any other currency or currency unit any amount in the currency or
currency unit due under any Notes then such conversion shall be made
by the Fiscal Agent at the market exchange rate (as determined by the
Fiscal Agent) as in effect on the date of entry of the judgment (the
"Judgment Date"); it being understood that the Fiscal Agent shall
effect such conversion only after receipt of the relevant funds from
the Issuer or, as the case may be, the Guarantor and that such
conversion may require up to three Business Days in Hong Kong, New
York City and the financial centre of the currency into which any
amount is converted to effect after the receipt of such funds. If
pursuant to any such judgment, conversion shall be made on a date (the
"Substitute Date") other than the Judgment Date and there shall occur
a change between the market exchange rate for U.S. dollars as in
effect on the Substitute Date and the market exchange rate as in
effect on the Judgment Date, the Issuer agrees to pay such additional
amounts (if any) in U.S. dollars as may be necessary to ensure that
the amount paid is equal to the amount in such other currency or
currency unit which, when converted at the market exchange rate as in
effect on the Judgment Date, is the amount due under any Notes. Any
amount due from the Issuer or, as the case may be, the Guarantor under
this Condition shall be due as a separate debt and is not to be
affected by or merged into any judgment being obtained for any other
sums due in respect of any Notes. In no event, however, shall the
Issuer or, as the case may be, the Guarantor be required to pay more
in U.S. dollars due under the Notes at the market exchange rate as in
effect on the Judgment Date than the amount of U.S. dollars stated to
be due under the Notes so that in any event the Issuer's and the
Guarantor's obligations under the Notes will be effectively maintained
as obligations in U.S. dollars and the Issuer or, as the case may be,
the Guarantor shall be entitled to withhold (or be reimbursed for, as
the case may be) any excess of the amount actually realised upon any
such conversion on the Substitute Date over the amount due and payable
on the Judgment Date.
15. FURTHER ISSUES
The Issuer may from time to time without the consent of the
Noteholders or Couponholders create and issue further notes, having
terms and conditions the same as those of the Notes, or the same
except for the amount of the first payment of interest, which may be
consolidated and form a single series with the outstanding Notes.
16. SUBSTITUTION
The Issuer may at any time substitute, without the consent of the
Noteholders or the Couponholders, the Guarantor or a Subsidiary of the
Guarantor (such substituted company being hereinafter called the "New
Company") to assume liability for the due and punctual payment of all
payments and the performance of all the Issuer's obligations under the
Notes and the Coupons then outstanding. Upon any such substitution,
the New Company shall succeed to the rights and obligations of the
Issuer (or any previous substitute) under the Notes and the Issuer (or
any previous substitute) shall be released from its liability on the
Notes. Such substitution shall be permitted only if, in addition to
assuming the obligations of the Issuer (or of any previous substitute)
under the Notes:
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(i) the New Company shall, by means of a deed poll (the "Substitution
Deed Poll"), agree to indemnify each Noteholder and Couponholder
against (A) any taxes, duties, fees, assessments or governmental
charges of whatever nature which are imposed on such holder with
respect to such Note, and which would not have been so imposed had
such substitution not been made, (B) any taxes, duties, fees,
assessments or governmental charges of whatever nature imposed on
or relating to such substitution and (C) any costs or expenses of
the act of such substitution;
(ii) unless such New Company is the Guarantor, the Guarantor shall in
the Substitution Deed Poll irrevocably guarantee all payments in
respect of the Notes;
(iii) the New Company shall warrant, by means of the Substitution Deed
Poll, that all necessary governmental approvals and consents for
the assumption by the New Company of its obligations and the
giving and implementation of the Guarantor's guarantee (if
applicable) have been obtained and are in full force and effect
and the obligations of the New Company under the Notes and of the
Guarantor under its guarantee to guarantee payments in respect of
the Notes (if applicable) are legal, valid, binding and
enforceable in accordance with their terms, subject to applicable
bankruptcy, insolvency and similar laws affecting creditors'
rights generally and general principles of equity; and
(iv) the New Company shall have obtained legal opinions from
independent legal advisers of recognised standing in the country
of incorporation of the New Company, Hong Kong and England that
the obligations of the New Company and, unless the New Company is
the Guarantor, the Guarantor in respect of the Notes and the
Substitution Deed Poll, as the case may be, are legal, valid and
binding and that all consents and approvals as aforesaid have been
obtained.
Not more than 30 nor less than 15 days prior to the effective date of
the substitution by the New Company, the Issuer shall give notice to
the Noteholders and the Couponholders, in accordance with Condition
12, of the substitution, stating that copies, or pending execution
thereof final drafts, of the Substitution Deed Poll and other relevant
documents and of the legal opinions are available for inspection by
Noteholders and Couponholders at the specified offices of the Paying
Agents during normal business hours. The originals of the Substitution
Deed Poll and other documents will be delivered to the Fiscal Agent to
hold until there are no claims outstanding in respect of the Notes or
the Coupons.
Upon the substitution becoming effective (x) references (if any) in
these Conditions to the British Virgin Islands shall be replaced by
references to the country of incorporation and, if different, the
country of tax residence of the New Company and (y) if the New Company
is not the Guarantor, all references in the Conditions to the
Guarantor shall apply to the Guarantor in its capacity as such
pursuant to Condition 16(ii) above.
17. CONTRACTS (RIGHTS OF THIRD PARTIES) ACT 1999
The Notes confer no right under the Contracts (Rights of Third
Parties) Xxx 0000 to enforce any term of these Notes, but this does
not affect any right or remedy of a third party which exists or is
available apart from that Act.
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18. GOVERNING LAW AND SUBMISSION TO JURISDICTION
(1) Governing Law
The Agency Agreement, the Guarantee, the Notes and the Coupons are
governed by, and will be construed in accordance with, English law.
(2) Jurisdiction of English Courts
The Issuer irrevocably agrees for the benefit of the Noteholders and
the Couponholders that the courts of England are to have jurisdiction
to settle any disputes which may arise out of or in connection with
the Notes or the Coupons and that accordingly any suit, action or
proceedings arising out of or in connection therewith (together
referred to as "Proceedings") may be brought in the courts of England.
The Issuer irrevocably and unconditionally waives and agrees not to
raise any objection which it may have now or subsequently to the
laying of the venue of any Proceedings in the courts of England and
any claim that any Proceedings have been brought in an inconvenient
forum and further irrevocably and unconditionally agrees that a
judgment in any Proceedings brought in the courts of England shall be
conclusive and binding upon it and may be enforced in the courts of
any other jurisdiction. Nothing in this Condition shall limit any
right to take Proceedings against the Issuer in any other court of
competent jurisdiction, nor shall the taking of Proceedings in one or
more jurisdictions preclude the taking of Proceedings in any other
jurisdiction, whether concurrently or not.
(3) Appointment of Process Agent
The Issuer hereby irrevocably and unconditionally appoints RB
Secretariat Limited at its registered office for the time being
(currently at 10th Floor, Beaufort House, 00 Xx. Xxxxxxx Xxxxxx,
Xxxxxx XX0X 0XX, Xxxxxxx at its registered office for the time being
as its agent for service of process in England in respect of any
Proceedings and undertakes that in the event of such agent ceasing so
to act it will appoint another person as its agent for that purpose.
FISCAL AGENT
Deutsche Bank AG, Hong Kong Branch
55th Floor, Xxxxxx Kong Center
0 Xxxxx'x Xxxx Xxxxxxx
Xxxx Xxxx
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SIGNATORIES
PCCW CAPITAL NO. 3 LIMITED
By:
PCCW LIMITED
By:
PCCW-HKT TELEPHONE LIMITED
By:
DEUTSCHE BANK AG, HONG KONG BRANCH
By:
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