Exhibit 4(b)
AGREEMENT
DATED 17th December, 1996
1,250,000,000 Pounds
CREDIT FACILITY
FOR
ENTERGY POWER UK PLC
ARRANGED BY
ABN AMRO BANK N.V.
BANK OF AMERICA INTERNATIONAL LIMITED
UNION BANK OF SWITZERLAND
THIS AGREEMENT is dated 17th December, 1996 between:-
(1) ENTERGY POWER UK PLC (Registered No. 3261188) (the
"Company");
(2) ABN AMRO BANK N.V., BANK OF AMERICA INTERNATIONAL LIMITED
and UNION BANK OF SWITZERLAND as arrangers (in this
capacity the "Arrangers");
(3) ABN AMRO BANK N.V. as issuing bank (in this capacity the
"Issuing Bank");
(4) THE FINANCIAL INSTITUTIONS listed in Schedule 1 as banks
(the "Banks"); and
(5) ABN AMRO BANK N.V. as agent (in this capacity the
"Agent").
IT IS AGREED as follows:-
1. INTERPRETATION
1.1 Definitions
In this Agreement:-
"Accounting Date"
means the last day of each financial quarter of the
Company.
"Accounting Period"
means any period of approximately three months or one
year ending on an Accounting Date for which accounts are
required to be prepared for the purposes of this
Agreement.
"Acquisition"
means the acquisition by the Company of any Shares
pursuant to the Offer and/or pursuant to open market
purchases.
"Act"
means the Electricity Act 1989 and, unless the context
otherwise requires, all subordinate legislation made
pursuant to it.
"Adjusted Capital and Reserves"
has the meaning given to it in Clause 19.28 (Financial
covenants).
"Affiliate"
means a Subsidiary or a Holding Company of a person and
any other Subsidiary of that Holding Company.
"Applicable Accounting Principles"
means accounting principles and practices, which at the
date of this Agreement are generally accepted in the
United Kingdom and approved by the Institute of Chartered
Accountants of England and Wales and which are consistent
with the accounting principles and practices applied in
the preparation of the Base Financial Statements.
"Auditors"
means Coopers and Lybrand or any other "Big Six" firm of
accountants or any other firm (approved by the Agent) of
independent public accountants of international standing
recognised and authorised by the Institute of Chartered
Accountants of England and Wales which is appointed by
the Company to audit the consolidated annual accounts of
the Company.
"Available Surplus Cashflow"
means that part of any Surplus Cashflow which has,
pursuant to Clause 19.15(b) (Distributions), been paid
(whether by way of dividend, loan repayment, interest or
loan) to the Company by the Target.
"Base Financial Statements"
means the audited annual consolidated accounts of the
Target for and as at the end of the financial year of the
Target ended 31st March, 1996.
"Beneficiary"
means a holder of a Loan Note.
"Bond Issues"
means:
(a) the pounds 100,000,000 8 per cent. bonds due 2003; and
(b) the pounds 100,000,000 8-5/8 per cent. bonds due 2005,
issued by the Target.
"Borrower"
means the Company or, upon its becoming a Borrower in
accordance with Clause 28.4 (Target as Borrower), the
Target.
"Borrower Accession Agreement"
means a letter substantially in the form of Part II of
Schedule 5 with such amendments as the Agent may approve.
"Borrowing"
means Financial Indebtedness (without double counting)
adjusted as follows:
(a) any interest, dividends, commission, fees or other
like financing charges, and any item falling within
paragraph (g) of the definition of Financial
Indebtedness, shall be excluded, save in each case
to the extent capitalised or more than 15 days
overdue for payment;
(b) in respect of any bonds, notes, debentures, loan
stocks and/or other debt securities issued at a
discount or redeemable at a premium and constituting
a Borrowing, the issue price thereof, together with
any applicable discount or premium recognised or
required by the Applicable Accounting Principles to
be recognised at the time of calculation (other than
amounts required by the Applicable Accounting
Principles to be accounted for as interest) in the
accounts of the relevant person (were any then to be
prepared), shall be included;
(c) in respect of paragraphs (d) and (e) of the
definition of Financial Indebtedness (but in the
case of paragraph (d), only where no interest or
similar charge is charged), only the principal
amount thereof as determined by the Applicable
Accounting Principles or (in the case of paragraph
(e)) the capitalised value (as so determined) of any
items falling thereunder shall be included;
(d) any item falling within paragraph (f) of the
definition of Financial Indebtedness which is in
respect of any sum excluded by paragraph (a) or (c)
above shall be excluded; and
(e) any item falling within paragraph (f)(ii) of the
definition of Financial Indebtedness shall be
included only to the extent that the same has been
or (in accordance with the Applicable Accounting
Principles) ought to be given a value in the latest
or next Accounts, or in any notes to those Accounts.
"Business Day"
means a day (other than a Saturday or a Sunday) on which
banks are open for business in London.
"Cancellation Date"
means the date of withdrawal or lapse of the Offer in
accordance with its terms.
"Capitalisation Ratio"
has the meaning given to it in Clause 19.28 (Financial
covenants).
"Cashflow"
means, for any period for which it is being tested,
Consolidated EBITDA for that period, but adjusted so as
to:
(a) add back any taxes refunded during that period;
(b) deduct any increase or add any reduction in working
capital which occurs during that period;
(c) deduct any taxes accrued or paid during that period
(adjusted in the case of VAT for any VAT input);
(d) deduct outflows and add inflows of cash effect
resulting from any Extraordinary Items;
(e) deduct any capital expenditure or costs or expenses
of a capital nature paid during that period and any
other expenditure not already taken into account
which is required to be paid under the Licence, any
Licence Undertaking or any applicable law or
regulation during the following financial quarter;
and
(f) take no account of any book profits or losses
arising from the disposal of any assets.
"Certain Funds Period"
means the period beginning on the date of issue of the
Press Release and ending on the earlier of:
(a) the date which falls three months after the
Unconditional Acceptances Date;
(b) the date which falls seven months after the date of
issue of the Press Release; and
(c) the date which falls seven days after the
Cancellation Date;
or, if prior to that date the Company has given notice
under section 429 of the Companies Act 1985 to
shareholders who have not accepted the Offer, any longer
period as may be required to enable the Company to
acquire shares within the period it is permitted to do so
under Section 428 to 430 of the Companies Act 1985
following the announcement of the Offer.
"Clean-Up Date"
means the date falling 180 days after the Target becomes
a Subsidiary of the Company.
"Code"
means the City Code on Takeovers and Mergers.
"Commitment"
means, in respect of a Bank, its Facility A Commitment,
Facility B Commitment or Facility C Commitment, and
"Commitments" means the aggregate of its Facility A
Commitment, Facility B Commitment and Facility C
Commitment.
"Consolidated EBITDA"
has the meaning given to it in Clause 19.28 (Financial
covenants).
"Consolidated Net Interest Payable"
has the meaning given to it in Clause 19.28 (Financial
covenants).
"Consolidated Net Total Borrowings"
has the meaning given to it in Clause 19.28 (Financial
covenants).
"Consolidated Total Interest Payable"
has the meaning given to it in Clause 19.28 (Financial
covenants).
"Dangerous Substance"
means any radioactive emissions, noise, any natural or
artificial substance (whether in the form of a solid,
liquid, gas or vapour) the generation, transportation,
storage, treatment, use or disposal of which (whether
alone or in combination with any other substance)
including (without limitation) any controlled, special,
hazardous, toxic, radioactive or dangerous substance or
waste, gives rise to a risk of causing harm to man or any
other living organism or damaging the Environment or
public health or welfare.
"Debenture"
means a debenture executed by the Company in favour of
the Agent substantially in the form of Schedule 7.
"Default"
means an Event of Default or an event which, with the
giving of notice, expiry of any applicable grace period,
determination of materiality or fulfilment of any other
applicable condition specified (in any such case) in
Clause 20 (Default) (or any combination of the
foregoing), would constitute an Event of Default.
"Director General"
means the person appointed from time to time by the
Secretary of State to hold office as the Director General
of Electricity Supply for the purpose of the Act.
"Double Taxation Treaty"
means any convention between the government of the United
Kingdom and any other government for the avoidance of
double taxation and the prevention of fiscal evasion with
respect to taxes on income and capital gains.
"Drawdown Date"
means the date of the advance of a Loan.
"Environment"
means any of the following media, the air (including,
without limitation, the air within buildings and the air
within other natural or man-made structures above or
below ground), water (including, without limitation,
ground and surface water) and land (including, without
limitation, surface and sub-surface soil).
"Environmental Claim"
means any claim by any person:
(a) in respect of any loss or liability suffered or
incurred by that person as a result of or in
connection with any violation of Environmental Law;
or
(b) that arises as a result of or in connection with
Environmental Contamination and that could give rise
to any remedy or penalty (whether interim or final)
that may be enforced or assessed by private or
public legal action or administrative order or
proceedings, including, without limitation, any such
claim arising from injury to persons, property or
natural resources.
"Environmental Contamination"
means each of the following and their consequences:
(a) any release, emission, leakage or spillage of any
Dangerous Substance at or from any site owned,
occupied or used by any member of the Group into any
part of the Environment; or
(b) any accident, fire, explosion or sudden event at any
site owned, occupied or used by any member of the
Group which is directly or indirectly caused by or
attributable to any Dangerous Substance; or
(c) any other pollution of the Environment.
"Environmental Law"
means all applicable laws (including, without limitation,
common law), regulations, directing codes of practice,
circulars, guidance notices and the like having legal
effect (whether in the United Kingdom or elsewhere)
concerning pollution or the protection of human health,
the Environment, the conditions of the work place or the
generation, transportation, storage, treatment or
disposal of Dangerous Substances.
"Environmental Licence"
means any authorisation required by any Environmental
Law.
"Event of Default"
means an event specified as such in Clause 20.1 (Events
of Default).
"Exceptional Items"
has the meaning given to it in Clause 19.28 (Financial
Covenants).
"Expiry Date"
means the expiry date of the Guarantee, as specified in
the Guarantee.
"Extraordinary Items"
has the meaning given to it in Clause 19.28 (Financial
Covenants).
"Facility"
means Facility A, Facility B or Facility C.
"Facility A"
means the facility referred to as such in Clause 2.1(a)
(Facilities).
"Facility A Commitment"
means:
(a) in relation to a Bank which is a Bank on the date of
this Agreement, the amount in Sterling set out in
the Syndication Letter; and
(b) in relation to a Bank which becomes a Bank after the
date of this Agreement, the amount of a Facility A
Commitment acquired by it under Clause 28 (Changes
to the Parties),
to the extent not transferred, cancelled or reduced under
this Agreement.
"Facility A Final Repayment Date"
means the date which falls five years after the date of
this Agreement.
"Facility A Loan"
means a loan made by the Banks under Facility A or the
principal amount outstanding of that loan.
"Facility A Outstandings"
means, at any time, the aggregate of the Guarantee
Outstandings and the Facility A Loans at that time.
"Facility B"
means the facility referred to as such in Clause 2.1(b)
(Facilities).
"Facility B Commitment"
means:
(a) in relation to a Bank which is a Bank on the date of
this Agreement, the amount in Sterling set out in
the Syndication Letter; and
(b) in relation to a Bank which becomes a Bank after the
date of this Agreement, the amount of a Facility B
Commitment acquired by it under Clause 28 (Changes
to the Parties),
to the extent not transferred, cancelled or reduced under
this Agreement.
"Facility B Final Repayment Date"
means the date falling two years after the date of this
Agreement.
"Facility B Loan"
means, subject to Clause 10 (Interest Periods), a loan
made by the Banks under Facility B or the principal
amount outstanding of that loan.
"Facility B Repayment Date"
means each date for the payment of a Facility B Repayment
Instalment.
"Facility B Repayment Instalment"
means each instalment for the repayment of Facility B
Loans referred to in Clause 8 (Repayment).
"Facility B Term Date"
means the last day of the Certain Funds Period.
"Facility C"
means the facility referred to as such in Clause 2.1(c)
(Facilities).
"Facility C Commitment"
means:
(a) in relation to a Bank which is a Bank on the date of
this Agreement, the amount in Sterling set out in
the Syndication Letter; and
(b) in relation to a Bank which becomes a Bank after the
date of this Agreement, the amount of a Facility C
Commitment acquired by it under Clause 28 (Changes
to the Parties),
to the extent not transferred, cancelled or reduced under
this Agreement.
"Facility C Final Repayment Date"
means the date which falls five years after the date of
this Agreement.
"Facility C Loan"
means a loan made by the Banks under Facility C or the
principal amount outstanding of that loan.
"Facility Office"
means the office notified by a Bank to the Agent:-
(a) on or before the date it becomes a Bank; or
(b) by not less than 5 Business Days' notice,
as the office through which it will perform all or any of
its obligations under this Agreement.
"Fee Letter"
means the letter dated the date of this Agreement between
the Arrangers and the Company, or the letter dated the
date of this Agreement between the Company and the Agent,
setting out the amount of various fees referred to in
Clause 22 (Fees).
"Final Maturity Date"
means the later of the Facility A Final Repayment Date
and the Facility C Final Repayment Date.
"Final Repayment Date"
means the Facility A Final Repayment Date, the Facility B
Final Repayment Date or the Facility C Final Repayment
Date.
"Finance Document"
means:-
(a) this Agreement;
(b) a Fee Letter;
(c) the Debenture;
(d) a Novation Certificate;
(e) the Syndication Agreement;
(f) a Borrower Accession Agreement;
(g) a Subordination Agreement;
(h) a Swap Document; or
(i) any other document designated as such by the Agent
and the Company.
"Finance Party"
means an Arranger, a Bank, the Issuing Bank or the Agent.
"Financial Indebtedness"
means any indebtedness for, or for interest or other
charges relating to, or otherwise in respect of or
pursuant to:-
(a) moneys borrowed or raised, including, without
limitation:
(i) monies raised by the sale of receivables or
other financial assets on terms (and to the
extent) that recourse may be had to the vendor
in the event of non-payment of those
receivables or financial assets when due;
(ii) monies raised under acceptance credit
facilities; and
(iii)monies raised through the issue of bonds,
notes, debentures, bills, loan stocks and other
debt securities (including any debt security
convertible, but not at the relevant time
converted, into share capital);
but any Subordinated Debt or Project Finance
Indebtedness (other than indebtedness referred to in
paragraph (f)(iii) below) shall not constitute
Financial Indebtedness;
(b) the acquisition cost of assets or services to the
extent payable on deferred payment terms after the
time of acquisition or possession by the party
liable (whether or not evidenced by any bond, note,
debenture, bill, loan stock or other debt security),
excluding:
(i) retentions which are normal in the trade
concerned and not entered into primarily as a
means of raising finance;
(ii) any payment relating to construction works or
the acquisition of fixed assets which will
become payable only upon fulfilment of
conditions relating to or comprising completion
or commissioning of certain stages in such
works or in the supply programme or the
granting of any planning permission for such
works or fixed assets and which has not yet
become payable by reason of the non-fulfilment
of any such condition; and
(iii)any such cost payable on deferred payment
terms which are normal in the business
concerned and not entered into primarily as a
means of raising finance, and which do not
involve any deferral of payment of any sum for
more than six months;
(c) moneys received in consideration for the supply of
goods and/or services to the extent received more
than six months before the due date for their supply
(but excluding any liability in respect of bona fide
advance payments and deposits received from
customers in the ordinary course of trade);
(d) instalments under conditional sale agreements
entered into primarily as a method of raising
finance;
(e) payments under leases (whether in respect of land,
machinery, equipment or otherwise) and payments
under hire purchase agreements and similar
agreements and instruments, in each case where those
leases, agreements or instruments are treated as
finance leases in accordance with the Applicable
Accounting Principles;
(f) (i) any guarantee, indemnity, letter of credit or
other legally binding instrument to
assure payment of, or against loss in respect
of non-payment of, any of the indebtedness
specified in this definition and any counter-
indemnity in respect of any thereof; and/or
(ii) any legally binding agreement or other
instrument entered into in connection with any
of the indebtedness specified in this
definition requiring, or giving any person the
right (contingently or otherwise) to require,
that any other person invest in, make advances
to, purchase assets of or maintain the solvency
or financial condition of any other person;
and/or
(iii)any recourse under any form of assurance,
undertaking or support of a type referred to in
paragraph (b)(iii) of the definition of
"Project Finance Indebtedness";
(g) any interest rate and/or currency swap, and any
other interest or currency protection, hedging or
financial futures transaction or arrangement; or
(h) transactions which involve or have the commercial
effect of the borrowing of commodities as part of
an arrangement for or in substitution for the
raising of finance, the value of indebtedness
concerned for this purpose being the sum which must
be paid and/or the value in money terms of the
commodities which must be delivered by the
"borrower" to, or to the order of, the "lender"
"First Test Date"
means the first date on which a financial covenant in
Clause 19.28(c) (Financial covenants) is tested, being:
(a) in the case of Clause 19.28(c)(i) (Financial
covenants), 30th June, 1997; and
(b) in the case of Clause 19.28(c)(ii) (Financial
covenants):
(i) if the Target becomes a member of the Group
within 6 weeks of the end of the then current
quarterly Accounting Period, the last day of
the next quarterly Accounting Period; or
(ii) in all other cases, the last day of the
quarterly Accounting Period in which the Target
becomes a member of the Group.
"Group"
means at any time the Company and its Subsidiaries at
that time.
"Guarantee"
means the guarantee to be issued by the Issuing Bank in
favour of the Beneficiaries, substantially in the form of
Schedule 6.
"Guarantee Outstandings"
means, at any time, the amount of the maximum liability
(whether actual or contingent) of the Banks under the
Guarantee.
"Holding Company"
has the meaning given to it in Section 736 of the
Companies Act 1985.
"Information Memorandum"
means the Information Memorandum prepared by the Company
in connection with the Syndication.
"Initial Capital Injection"
means an amount (in a minimum aggregate amount as
specified in the Syndication Letter) of paid up equity
share capital or paid in capital contributions, or any
combination of the two, to be subscribed for in, or on
lent to, the Company by the Parent prior to any Request
being made.
"Interest Period"
means each period selected in accordance with Clause 10
(Interest Periods).
"Issue Date"
means the date of issue of the Guarantee.
"LIBOR"
means the arithmetic mean (rounded upward to the nearest
four decimal places) of the rates, 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. on the first day of an Interest Period for the
offering of deposits in Sterling for a period comparable
to the Interest Period.
"Licence"
means a public electricity supply licence held by a
member of the Group and issued pursuant to Section 6(1)
of the Act, as modified or supplemented from time to
time.
"Licenceholder"
means at any time the member of the Group which then
holds a Licence.
"Licence Undertaking"
means any undertaking or assurance given in connection
with the Offer by any one or more of the Company, the
Target or any Affiliate of any of them to the Director
General or the Secretary of State concerning the
management and/or ownership of and/or other matters
concerning the Target once it has become a Subsidiary of
the Company.
"Loan"
means a Facility A Loan, a Facility B Loan or a
Facility C Loan.
"Loan Note"
means any loan note offered or issued by the Company to
shareholders of the Target in connection with the Offer.
"Major Default"
means an Event of Default arising as a result of an act
of, omission by, or circumstance affecting the Company
(other than one relating to the Target or its
Subsidiaries) and which is referred to in Clause 20.2
(Non-payment) or Clauses 20.6 (Insolvency) to 20.8
(Appointment of receivers and managers) inclusive or
20.10 (Analogous proceedings) to 20.12 (Unlawfulness)
inclusive.
"Majority Banks"
means, at any time, Banks:-
(a) whose participations in all Loans then outstanding
aggregate more than 662/3 per cent. of all Loans
then outstanding; or
(b) if there are no Loans then outstanding, whose
Commitments then aggregate more than 662/3 per cent.
of the Total Commitments; or
(c) if there are no Loans then outstanding and the Total
Commitments have been reduced to zero, whose
Commitments aggregated more than 662/3 per cent. of
the Total Commitments immediately before the
reduction.
"Margin"
means, subject to Clause 11.1(b) (Interest Rate) and to
paragraph (d) below and with effect from each applicable
Margin Adjustment Date:
(a) in respect of a Facility A Loan, at any time when
the Capitalisation Ratio is:
(i) greater than 80 per cent., 1.50 per cent. per
annum;
(ii) equal to or less than 80 per cent., but greater
than 75 per cent., 1.15 per cent. per annum;
(iii)equal to or less than 75 per cent., but
greater than 70 per cent., 0.90 per cent. per
annum;
(iv) equal to or less than 70 per cent., but greater
than 65 per cent., 0.70 per cent. per annum;
(v) equal to or less than 65 per cent., but greater
than 60 per cent., 0.575 per cent. per annum;
(vi) equal to or less than 60 per cent., but greater
than 55 per cent., 0.45 per cent. per annum;
and
(vii)equal to or less than 55 per cent., 0.30
per cent. per annum,
subject to a maximum, until the date falling six
months after the date of this Agreement, of 1.25 per
cent. per annum;
(b) in respect of a Facility B Loan:
(i) for the period from the date of this Agreement
up to (and including) the date falling three
months after the date of this Agreement, 0.25
per cent. per annum; and
(ii) thereafter, the Margin which would be
applicable to a Facility A Loan, as set out in
paragraph (a) above;
(c) in respect of a Facility C Loan:
(i) at any time on or prior to the date on which
the Facility B Loans are prepaid or repaid in
full, the Margin which would be applicable to a
Facility A Loan, as set out in paragraph (a)
above; and
(ii) thereafter, 0.25 per cent. per annum; and
(d) if, on the first anniversary of the date of this
Agreement, the Facility B Loans have not been fully
repaid or prepaid, then either:-
(i) the Company will procure a guarantee of the
outstanding Facility B Loans on terms and from
an entity acceptable to all of the Banks in
their sole discretion in which case:-
(A) the Margin on the Facility B Loans shall
be the same Margin which would be
applicable to a Facility A Loan, as set
out in paragraph (a) above; and
(B) the provisions of paragraph (b) of Clause
8 (Repayment) shall not apply; or
(ii) if the Company has not procured a guarantee of
the outstanding Facility B Loans on terms and
from an entity acceptable to all of the Banks
in their sole discretion, then:-
(A) from the first anniversary of the date of
this Agreement up to the date falling 18
months after the date of this Agreement,
the Margin for Facility A Loans,
Facility B Loans and Facility C Loans
shall increase to 0.50 per cent. per annum
above the rate which otherwise would be
applicable under paragraph (a), (b) or (c)
above; and
(B) from the date falling 18 months after the
date of this Agreement up to and including
the Facility B Final Repayment Date, the
Margin on Facility A Loans, Facility B
Loans and Facility C Loans shall increase
to 1 per cent. per annum above the rate
which otherwise would be applicable under
paragraph (a), (b) or (c) above.
"Margin Adjustment Date"
means in respect of a Loan:
(a) the Business Day following any Subsequent Capital
Injection;
(b) the first day of the first Interest Period for that
Loan commencing after each determination of the
Capitalisation Ratio following delivery by the
Company of a certificate under Clause 19.2(c)(i) or
(ii) (Financial information); and
(c) if paragraph (d)(ii) of the definition of Margin is
applicable, the first anniversary of the date of
this Agreement and/or the date falling 18 months
after the date of this Agreement, as appropriate.
"Material Subsidiary"
means:
(a) the Target;
(b) any member of the Group (other than the Company and
any Project Finance Subsidiary):
(i) which is the Licenceholder; or
(ii) whose pre-tax profits represent at least ten
per cent. of the consolidated pre-tax profits
of the Group; or
(iii) the book value of whose gross assets
represents at least ten per cent. of the
consolidated gross assets of the Group,
and for this purpose:
(A) in the case of a company which itself has
Subsidiaries, the calculation shall be made by
using the consolidated pre-tax profits or gross
assets, as the case may be, of it and its
Subsidiaries;
(B) all calculations of consolidated pre-tax
profits or gross assets shall be made by
reference to:
(1) the latest accounts of the relevant
company (or, as the case may be, a
consolidation of the accounts of it and
its Subsidiaries) used for the purpose of
the then latest unaudited quarterly or
audited annual consolidated accounts of
the Group delivered to the Agent under
Clause 19.2 (Financial information); and
(2) those unaudited quarterly or, as the case
may be, audited annual consolidated
accounts of the Group;
and shall be made in accordance with the
Applicable Accounting Principles; or
(c) any member of the Group (other than the Company and
any Project Finance Subsidiary) which is not
otherwise a Material Subsidiary under this
definition but to which any Material Subsidiary
transfers in any annual Accounting Period all or
substantially all of its assets; the Material
Subsidiary from which the assets were transferred
shall cease to be a Material Subsidiary unless and
until it is shown to be a Material Subsidiary under
any other paragraph of this definition.
In the event of any dispute as to whether a Subsidiary is
or is not at any time a Material Subsidiary the question
shall be referred to the Auditors for determination
according to the provisions of this definition (acting as
experts at the cost of the Company) and their decision
shall be conclusive and binding on the Parties in the
absence of manifest error.
"Minimum Subsequent Capital Injection"
means the minimum aggregate amount (as specified in the
Syndication Letter) of Subsequent Capital Injections.
"MLA Cost"
means the cost imputed to the Banks of compliance with
the Mandatory Liquid Assets requirements of the Bank of
England during each Interest Period, determined in
accordance with Schedule 3.
"MMC Referral"
means a referral of the Offer by the Secretary of State
to the Monopolies and Mergers Commission.
"Novation Certificate"
has the meaning given to it in Clause 28.3 (Procedure for
novations).
"Offer"
means the offer made or proposed to be made for the
Shares by or on behalf of the Company to the shareholders
of the Target substantially on the terms referred to in
the Press Release, as such offer may be amended,
extended, varied and/or waived.
"Offer Costs"
means all costs, fees and expenses (including taxes or
similar charges thereon) and all stamp, documentary,
registration and similar taxes or charges incurred by or
on behalf of the Company in connection with the Offer,
including the preparation, negotiation and entry into of
the Finance Documents.
"Offer Documents"
means each of the documents issued or to be issued by the
Company to the shareholders of the Target (including the
forms of acceptance) in respect of the Offer.
"Offer Utilisation"
means any of the following Utilisations:-
(a) a Facility A Loan or Facility B Loan borrowed for
the purpose of financing or refinancing the costs of
the Acquisition or consideration payable to Share
Option Holders and Loan Note Holders in connection
with the Acquisition; or
(b) the Guarantee.
"Panel"
means The Panel on Takeovers and Mergers.
"Parent"
means Entergy Power UK Holding Limited (Registered No.
3261305).
"Party"
means a party to this Agreement.
"Permitted Transaction"
means:
(a) a reconstruction, amalgamation, reorganisation,
merger or consolidation of a Borrower or a Material
Subsidiary on terms approved by the Majority Banks;
(b) a disposal of assets permitted by the terms of this
Agreement; or
(c) a solvent liquidation, dissolution or winding-up of
a Material Subsidiary (other than the Target or the
Licenceholder) which does not have a Material
Adverse Effect.
"Pooling and Settlement Agreement"
means the agreement dated 30th March, 1990 made by the
Target with the National Grid Company plc and others
setting out the rules and procedures for the operation of
an electricity trading pool and of a settlement system.
"Press Release"
means the press release referred to in Part I of Schedule
2 to be made by or on behalf of the Company announcing
the terms of the Offer.
"Project Finance Indebtedness"
means any Borrowing which finances the acquisition,
development, ownership and/or operation of an asset:
(a) which is incurred by a Project Finance Subsidiary;
or
(b) in respect of which the person or persons to whom
the Borrowing is or may be owed by the relevant
debtor (whether or not a member of the Group) has or
have no recourse whatsoever to any member of the
Group (other than to a Project Finance Subsidiary)
for its repayment other than:
(i) recourse to the debtor for amounts limited to
the cash flow or net cash flow (other than
historic cash flow or historic net cash flow)
from the asset; and/or
(ii) recourse to the debtor for the purpose only of
enabling amounts to be claimed in respect of
that Borrowing in an enforcement of any
Security Interest given by the debtor over the
asset or the income, cash flow or other
proceeds deriving from the asset (or given by
any shareholder or the like in the debtor over
its shares or like interest in the capital of
the debtor) to secure the Borrowing but only
if:
(A) the extent of the recourse to the
debtor is limited solely to the amount of
any recoveries made on any such
enforcement; and
(B) that person or persons are not
entitled, by virtue of any right or claim
arising out of or in connection with that
Borrowing, to commence proceedings for the
winding up or dissolution of the debtor or
to appoint or procure the appointment of
any receiver, trustee or similar person or
officer in respect of the debtor or any of
its assets (other than the assets the
subject of that Security Interest); and/or
(iii) recourse to the debtor generally, or
directly or indirectly to a member of the
Group, under any form of assurance, undertaking
or support, which recourse is limited to a
claim for damages (other than liquidated
damages and damages required to be calculated
in a specified way) for breach of an obligation
(other than a payment obligation or an
obligation to procure payment by another or an
indemnity in respect thereof or any obligation
to comply or to procure compliance by another
with any financial ratios or other tests of
financial condition) by the person against whom
such recourse is available.
"Project Finance Subsidiary"
means any Subsidiary of the Company (other than the
Licenceholder):
(a) which is a company whose principal assets and
business are constituted by the ownership,
acquisition, development and/or operation of an
asset whether directly or indirectly;
(b) none of whose Borrowings in respect of the financing
of the ownership, acquisition, development and/or
operation of an asset benefits from any recourse
whatsoever to any member of the Group (other than
the Subsidiary itself or another Project Finance
Subsidiary) in respect of its repayment, except as
expressly referred to in paragraph (b)(iii) of the
definition of Project Finance Indebtedness in this
Clause 1.1 (Definitions); and
(c) which has been designated as such by the Company by
notice to the Agent. However, the Company may give
notice to the Agent at any time that any Project
Finance Subsidiary is no longer a Project Finance
Subsidiary, whereupon it shall cease to be a Project
Finance Subsidiary.
"Qualifying Bank"
means:-
(a) a bank as defined in Section 840A of the Income and
Corporation Taxes Act 1988 which, for the purposes
of Section 349 of the Income and Corporation Taxes
Act 1988, is within the charge to United Kingdom
corporation tax as regards any interest received by
it under this Agreement, except that, if that
Section is repealed, modified, extended or re-
enacted, the Agent may at any time and from time to
time (acting reasonably) amend this definition to
reflect such repeal, modification, extension or
enactment by giving notice of the amended definition
to the Company; or
(b) a person carrying on a bona fide banking business
who is resident (as such term is defined in the
appropriate Double Taxation Treaty) in a country
with which the United Kingdom has an appropriate
Double Taxation Treaty giving residents of that
country full exemption from United Kingdom taxation
on interest and does not carry on business in the
United Kingdom through a permanent establishment
with which the indebtedness under this Agreement in
respect of which the interest is paid is effectively
connected.
"Reduction Date"
means the date falling three years after the date of this
Agreement.
"Reference Banks"
means, subject to Clause 28.5 (Reference Banks), the
principal London offices of ABN AMRO Bank N.V., Bank of
America National Trust and Savings Association and Union
Bank of Switzerland.
"Relevant Percentage"
means, in relation to a Bank, the proportionate liability
of that Bank under the Guarantee, being the proportion
its Commitments bear to the Total Commitments, expressed
as a percentage.
"Repayment Date"
means a Facility B Repayment Date or the last day of the
Interest Period of a Facility A Loan or a Facility C
Loan.
"Request"
means a request made by a Borrower for a Loan or the
Guarantee, substantially in the form of Schedule 4.
"Rollover Loan"
means a Facility A Loan or a Facility C Loan, the
principal amount of which is less than or equal to an
outstanding Facility A Loan or Facility C Loan, as the
case may be, and whose Drawdown Date coincides with the
Repayment Date of that outstanding Facility A Loan or
Facility C Loan, as the case may be.
"Secretary of State"
means the Secretary of State as referred to in the Act.
"Security Account"
has the meaning given to it in the Debenture.
"Security Interest"
means any mortgage, pledge, lien, charge, assignment,
hypothecation or security interest or any other agreement
or arrangement having the effect of conferring security.
"Share Option"
means an option to acquire shares in the Target.
"Share Option Holder"
means any holder of a Share Option.
"Shares"
means all the issued shares (and Share Options) in the
capital of the Target (including any shares of the Target
issued while the Offer remains open for acceptance).
"Sterling"
means the lawful currency for the time being of the
United Kingdom.
"Subordinated Debt"
means a separate unsecured loan to the Company from a
shareholder, or an Affiliate of a shareholder, of the
Company and/or any other person permitted under this
Agreement which:
(a) has a maturity date falling after the later of
Facility A Final Repayment Date and the Facility C
Final Repayment Date;
(b) is not capable of acceleration (other than in the
event of insolvency or an insolvency proceeding)
whilst any amount may be or become payable by any
Borrower under the Finance Documents or any of the
Commitments remain in effect; and
(c) is subordinated (as regards priority of payment,
ranking, rights of enforcement and all other rights)
as to principal, interest and all other amounts
payable on or in respect thereof and any and all
claims (including for damages) related thereto to
all amounts which may be or become payable by the
Borrowers under the Finance Documents,
all in accordance with a Subordination Agreement.
"Subordination Agreement"
means a subordination agreement entered, or to be
entered, into by the Agent, the Company and any other
person in respect of Subordinated Debt, substantially in
the form of Schedule 9.
"Subsequent Capital Injection"
means (following the Initial Capital Injection) either:
(a) another contribution of paid up equity capital in
the Company either by way of the issuing by the
Company of additional share capital or by way of
capital contribution; and/or
(b) another loan to the Company, constituting
Subordinated Debt,
where the aggregate of the proceeds of the equity capital
issued, transferred or contributed and/or the principal
amount of the Subordinated Debt are to be applied in
prepayment of the Loans to the extent required by
Clause 9.6 (Mandatory prepayment/cancellation).
"Subsidiary"
means:-
(a) a subsidiary within the meaning of Section 736 of
the Companies Act 1985, as amended by Section 144 of
the Companies Act 1989; and
(b) for the purposes of Clauses 19.28 (Financial
covenants) and any financial information relating to
the Group, a subsidiary undertaking within the
meaning of Section 21 of the Companies Act 1989.
"Surplus Cashflow"
means, for any period for which Cashflow is calculated,
Cashflow for that period less the obligations of the
Group in respect of Financial Indebtedness which are
actually paid during that period.
"Swap Document"
means any interest rate hedging agreement (substantially
in the form agreed by the Company and the Agent prior to
the date of this Agreement) entered into by the Company
with any of the Banks party to this Agreement as at the
date of this Agreement and any confirmation entered into
pursuant to any such agreement.
"Syndication"
means the primary syndication (including the initial
syndication to sub-underwriters and the subsequent
general syndication) by the Arrangers of the Facilities.
"Syndication Agreement"
means an agreement substantially in the form of Part III
of Schedule 5.
"Syndication Letter"
means a letter dated the date of this Agreement from the
Arrangers to the Company in respect of the Syndication
and other matters.
"Target"
means London Electricity plc (Registered no. 2366852).
"Total Commitments"
means the aggregate of the Total Facility A Commitments,
the Total Facility B Commitments and the Total Facility C
Commitments, being 1,250,000,000 pounds at the date of this
Agreement.
"Total Facility A Commitments"
means the aggregate for the time being of the Facility A
Commitments, being the amount agreed in the Syndication
Letter.
"Total Facility B Commitments"
means the aggregate for the time being of the Facility B
Commitments, being the amount agreed in the Syndication
Letter.
"Total Facility C Commitments"
means the aggregate for the time being of the Facility C
Commitments, being the amount agreed in the Syndication
Letter.
"Unconditional Acceptances Date"
means the date on which the Offer is declared or becomes
unconditional as to acceptances.
"Utilisation"
means a Loan or the Guarantee.
"Utilisation Date"
means a Drawdown Date or the Issue Date.
1.2 Construction
(a) In this Agreement, unless the contrary intention appears,
a reference to:
(i) "assets" includes properties, revenues and rights of
every description;
an "authorisation" includes an authorisation,
consent, approval, resolution, licence, exemption,
filing, registration and notarisation;
something having a "Material Adverse Effect" is to
its having, or being reasonably likely to have, a
material adverse effect on the ability of a Borrower
to perform and comply with:
(A) its payment obligations under any Finance
Document; or
(B) its obligations under Clause 19.28 (Financial
Covenants); or
(C) any other of its material obligations under the
Finance Documents;
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, except that:
(1) 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 calendar month; or
(2) if an Interest Period commences on the last
Business Day of a calendar month, that Interest
Period shall end on the last Business Day in
the calendar month in which it is to end; and
a "regulation" includes any regulation, rule,
official directive, request or guideline (whether or
not having the force of law, but if not having the
force of law being of a type with which the person
concerned is accustomed to comply) of any
governmental body, agency, department or regulatory,
self-regulatory or other authority or organisation;
(ii) a provision of a law is a reference to that
provision as amended or re-enacted;
(iii) a Clause or a Schedule is a reference to a
clause of or a schedule to this Agreement;
(iv) a person includes its successors and permitted
assigns;
(v) a Finance Document or another document is a
reference to that Finance Document or that other
document as amended, novated, supplemented, replaced
or renewed; and
(vi) a time of day is a reference to London time.
(b) Unless the contrary intention appears, a term used in any
other Finance Document or in any notice given under or in
connection with any Finance Document has the same meaning
in that Finance Document or notice as in this Agreement.
(c) The index to and the headings in this Agreement are for
convenience only and are to be ignored in construing this
Agreement.
2. THE FACILITIES
2.1 Facilities
Subject to the terms of this Agreement, the Banks
irrevocably grant to the Borrowers the following
facilities:-
(a) Facility A - a committed guarantee and revolving
credit facility under which, when requested by the
Company:-
(i) the Issuing Bank shall issue the Guarantee in
an amount which, when aggregated with the
amount of any Facility A Loans outstanding at
that time, does not exceed the Total Facility A
Commitments at that time; or
(ii) the Banks shall make to the Company Loans up to
an aggregate amount which, when aggregated with
the Guarantee Outstandings at that time, does
not exceed the Total Facility A Commitments at
that time;
(b) Facility B - a committed term loan facility under
which the Banks shall, when requested by the
Company, make to the Company Loans up to an
aggregate amount not exceeding, at any time, the
Total Facility B Commitments at that time; and
(c) Facility C - a committed revolving credit facility
under which the Banks shall, when requested by the
Target, make to the Target Loans up to an aggregate
amount not exceeding, at any time, the Total
Facility C Commitments at that time.
No Bank is obliged to lend at any time more than its
Commitment(s).
2.2 Nature of a Finance Party's rights and obligations
(a) The obligations of a Finance Party under the Finance
Documents are several. Failure of a Finance Party to
carry out those obligations does not relieve any other
Party of its obligations under the Finance Documents. No
Finance Party is responsible for the obligations of any
other Finance Party under the Finance Documents.
(b) The rights of a Finance Party under the Finance Documents
are divided rights. A Finance Party may, except as
otherwise stated in the Finance Documents, separately
enforce those rights.
2.3 Change of currency
(a) If more than one currency or currency unit are at the
same time recognised by the laws of any country as the
lawful currency of that country, then:
(i) any reference in the Finance Documents to, and any
obligations arising under the Finance Documents in,
the currency of that country shall be translated
into, or paid in, the lawful currency or currency
unit of that country designated by the Agent; and
(ii) any translation from one currency or currency unit
to another shall be at the official rate of exchange
legally recognised by the central bank for the
conversion of that currency or currency unit into
the other, rounded up or down by the Agent acting
in accordance with any applicable law on rounding
or, if there is no such law, acting reasonably in
accordance with its market practice.
(b) If a change in any currency of a country occurs, this
Agreement will be amended to the extent the Agent (acting
reasonably) specifies to be necessary to reflect the
change in currency and to put the Banks (and, if possible
and practicable, the Borrowers) in the same position, so
far as possible, that they would have been in if no
change in currency had occurred.
3. PURPOSE AND AVAILABILITY
(a) (i) The Company shall apply each Facility A Loan
made to it towards:-
(A) financing or refinancing the cost of the
Acquisition and the fees, costs and expenses
associated with the Acquisition, including
under the procedures in Sections 428-430 of the
Companies Act 1985;
(B) financing or refinancing the consideration
payable to Share Option Holders and Loan Note
Holders in connection with the Acquisition; or
(C) its working capital or general corporate
purposes.
(ii) The Guarantee is to be issued for the purpose of
guaranteeing the obligations of the Company under
the Loan Notes.
(iii) Facility A Loans may be borrowed and the
Guarantee may be issued, subject to the terms of
this Agreement, at any time after the Unconditional
Acceptances Date and prior to the Facility A Final
Repayment Date.
(b) (i) The Company shall apply each Facility B Loan
made to it towards:-
(A) financing or refinancing the cost of the
Acquisition and the fees, costs and expenses
associated with the Acquisition, including
under the procedures in Sections 428-430 of the
Companies Act 1985;
(B) financing or refinancing the consideration
payable to Share Option Holders and Loan Note
Holders in connection with the Acquisition; or
(C) financing the purchase of Shares in the market
up to a maximum aggregate shareholding of 29.9
per cent. of the Shares.
(ii) Facility B Loans may be borrowed, subject to the
terms of this Agreement, at any time on or before
the Facility B Term Date.
(c) (i) Upon its becoming a Borrower, the Target shall
apply each Facility C Loan made to it towards:-
(A) refinancing any facilities of the Target
(excluding the refinancing of any Bond Issues)
outstanding at the date on which the Target
becomes a Subsidiary of the Company; or
(B) its working capital and general corporate
purposes.
(ii) Facility C Loans may be borrowed by the Target,
subject to the terms of this Agreement, at any time
after the Target becomes a Borrower and prior to the
Facility C Final Repayment Date.
(d) Without affecting the obligations of any Borrower in any
way, no Finance Party is bound to monitor or verify the
application of any Utilisation.
4. CONDITIONS PRECEDENT
4.1 Documentary conditions precedent
(a) The obligations of each Finance Party to the Borrowers
under this Agreement are subject to the condition
precedent that the Agent has notified the Company and the
Banks that it has received all of the documents set out
in Part I of Schedule 2.
(b) The documents referred to in paragraph (a) above must be
(except for those mentioned in paragraph 4 of Part I of
Schedule 2) in a form agreed by the Company and the Agent
prior to the date of this Agreement or in form and
substance satisfactory to the Agent. The Agent shall
promptly notify the Company and the Banks of receipt of
those documents.
4.2 Further conditions precedent
Subject to Clause 4.3 (Conditions precedent during the
Certain Funds Period), the obligations of each Bank to
participate in a Utilisation are subject to the further
conditions precedent that:-
(a) on both the date of the Request and the Utilisation
Date:-
(i) the representations and warranties in Clause 18
(Representations and warranties) to be repeated
on those dates are correct in all material
respects and will be correct in all material
respects immediately after the Utilisation is
made; and
(ii) no Default or (in the case of a Rollover Loan)
no Event of Default is outstanding or will
result from the Utilisation;
(b) it would not cause the Facility A Outstandings, the
Facility B Loans or the Facility C Loans to exceed
the Total Facility A Commitments, the Total
Facility B Commitments or the Total Facility C
Commitments, as the case may be; and
(c) it would not result in there being more than 15
Utilisations outstanding at any time.
4.3 Conditions precedent during the Certain Funds Period
Notwithstanding Clause 4.2 (Further conditions precedent)
but without prejudice to Clause 4.1 (Documentary
conditions precedent), the obligations of a Bank to
participate in an Offer Utilisation during the Certain
Funds Period is only subject to the conditions precedent
that:-
(a) on both the date of the Request and the Drawdown
Date for that Offer Utilisation:-
(i) the representations and warranties to be made
by the Company in respect of itself and set out
in Clauses 18.2(a) (Status), 18.3 (Power and
authority), 18.4 (Legal validity) and 18.5 (Non-
conflict) are correct in all material respects
and will be correct in all material respects
immediately after the Utilisation is made;
(ii) no Major Default is outstanding or will result
from the Utilisation; and
(iii) the Office of Fair Trading has indicated
in writing that there will be no MMC Referral
or, in the case of a Facility B Loan for the
purpose referred to in Clause 3(b)(i)(C)
(Purpose and Availability), there has been no
MMC Referral;
(b) in the case of the first Loan borrowed during the
Certain Funds Period, all of the Initial Capital
Injection has been, or together with the proceeds of
that Loan will on the Drawdown Date be, applied in
financing or refinancing the cost of the Acquisition
and the fees, costs and expenses associated with the
Acquisition;
(c) it would not cause the Facility A Outstandings to
exceed the Total Facility A Commitments or the
Facility B Loans to exceed the Total Facility B
Commitments; and
(d) it would not result in there being more than 15
Utilisations outstanding at any time.
4.4 Lapse of the Offer
If the Offer is withdrawn or lapsed, then, without
prejudice to the other terms of this Agreement, no
further Loans may be made on or after the Cancellation
Date.
5. UTILISATIONS
5.1 Receipt of Requests
(a) A Borrower may utilise a Facility by way of a Loan
if the Agent receives, not later than the relevant
time, a duly completed Request.
(b) The Company may utilise Facility A by way of the
Guarantee if the Agent receives, not later than the
relevant time, a duly completed Request.
(c) The relevant time for:
(i) a Loan to be made to finance purchases of
Shares in the market is 4.00 p.m. on the
Business Day before its Drawdown Date;
(ii) any other Loan is 9.00 a.m. on the Business Day
before its Drawdown Date; and
(iii) the Guarantee is 9.00 a.m. on the Business
Day before the Issue Date.
5.2 Completion of Requests for Loans
A Request for a Loan will not be regarded as having been
duly completed unless:-
(a) it specifies whether the Loan is a Facility A Loan,
a Facility B Loan or a Facility C Loan and the
purpose for which the Loan is to be used;
(b) the Drawdown Date is a Business Day falling:
(i) in the case of a Facility A Loan, on or after
the Unconditional Acceptances Date and before
the Facility A Final Repayment Date;
(ii) in the case of a Facility B Loan, after
the date of this Agreement and before the
Facility B Term Date; and
(iii) in the case of a Facility C Loan, on or
after the Unconditional Acceptances Date and
before the Facility C Final Repayment Date;
(c) the principal amount of the Loan is a minimum of
10,000,000 pounds and an integral multiple of 5,000,000
pounds;
(d) the Interest Period specified complies with
Clause 10 (Interest Periods); and
(e) the payment instructions comply with Clause 12
(Payments).
Each Request is irrevocable.
5.3 Completion of Request for the Guarantee
The Request for the Guarantee will not be regarded as
having been duly completed unless it specifies:
(a) the maximum amount of the Guarantee, which must be a
minimum amount of 10,000,000 pounds and an amount which
would not cause the Facility A Outstandings to
exceed the Total Facility A Commitments;
(b) the Issue Date, being a Business Day falling after
the Unconditional Acceptances Date and before the
Facility A Repayment Date;
(c) the Expiry Date, which shall be not later than
Facility A Repayment Date;
(d) the delivery instructions for the Guarantee; and
(e) the form of the Guarantee, which must be attached to
the Request and be substantially in the form of
Schedule 6.
Each Request is irrevocable.
5.4 Amount of each Bank's participation in the Utilisation
(a) The amount of a Bank's participation in a Loan will be
the proportion of the Loan which its Commitments bear to
the Total Commitments on the proposed Drawdown Date.
(b) The amount of a Bank's participation in the Guarantee
will be the proportion of the maximum amount of the
Guarantee which its Commitments bears to the Total
Commitments.
5.5 Notification of the Banks
(a) The Agent shall promptly notify each Bank of the details
of the requested Loan and the amount of its participation
in the Loan.
(b) The Agent shall notify the Issuing Bank and each Bank of
the details of the requested Guarantee, including, in the
case of each Bank, its Relevant Percentage in relation to
the Guarantee.
5.6 Payment of Proceeds
Subject to the terms of this Agreement, each relevant
Bank shall make its participation in a Loan available to
the Agent for the relevant Borrower on the relevant
Drawdown Date.
5.7 Delivery of Guarantee
Subject to the terms of this Agreement:
(a) the Issuing Bank will execute the Guarantee prior to
or on (but to be effective from) the date requested
in the Request as the Issue Date; and
(b) the Issuing Bank shall (through the Agent) issue the
Guarantee on the Issue Date.
If the Guarantee is executed by the Issuing Bank before
the Issue Date and/or the amount of the Guarantee is
known, then, subject to the terms of this Agreement, the
Agent is authorised to insert, on behalf of the Issuing
Bank, the Issue Date and/or the relevant amount in the
Guarantee on receipt of the relevant Request.
6. CLAIMS UNDER THE GUARANTEE
6.1 Notification of claim
If a Beneficiary makes a claim under the Guarantee in
accordance with its terms, the Issuing Bank shall
promptly notify the Agent of the claim. If a claim has
been made on the Issuing Bank and notified to the Agent,
the Agent shall promptly notify the Company and each Bank
specifying:-
(a) the latest date on which payment may be made in
respect of the claim (the "Payment Date");
(b) the amount of the claim (the "Claimed Amount") and
each Bank's Relevant Percentage of the Claimed
Amount; and
(c) the details of the Issuing Bank's account to which
payment is to be made.
6.2 Payment by the Company
The Company shall, not later than 9.30 a.m. on the
Business Day preceding the Payment Date, pay to the
Issuing Bank the Claimed Amount.
6.3 Payment by the Banks
(a) If the Issuing Bank has not received the Claimed Amount
from the Company by 9.30 a.m. on the Business Day
preceding the Payment Date, it shall notify the Agent by
not later than 10.30 a.m. on that day.
(b) The Agent shall, if notified under paragraph (a) above,
notify each Bank not later than 12.00 noon on the same
day.
(c) Each Bank shall, if notified under paragraph (b) above,
pay to the Issuing Bank, not later than 12.00 noon on the
Payment Date, that Bank's Relevant Percentage of the
unpaid amount of the Claimed Amount.
6.4 Default by Banks
(a) If any Bank (a "Defaulting Bank") fails to make any
payment due from it for the account of the Issuing Bank
under Clause 6.3 (Payment by the Banks), then until the
Issuing Bank has been reimbursed in respect thereof in
full (but without prejudice to the obligations of that
Defaulting Bank to make such payment):
(i) the Defaulting Bank shall hold on trust for the
Issuing Bank the benefit of any security now or
hereafter created to secure the obligations of the
Borrowers under this Agreement and to which that
Defaulting Bank would have been entitled had it made
such payment; and
(ii) for the purposes of determining the constitution of
the Majority Banks:
(A) the Issuing Bank shall be treated as having a
Facility A Commitment equal to that of the
Defaulting Bank (in addition to the Facility A
Commitment (if any) which the Issuing Bank
already had in its capacity as a Bank); and
(B) that Defaulting Bank shall be treated, for such
purpose only, as having no Facility A
Commitment.
(b) The rights conferred upon the Issuing Bank in this
Clause 6.4 are in addition to any other rights which it
may have against a Defaulting Bank.
6.5 Indemnity by the Banks
Without limiting the liability of the Company under this
Agreement, each Bank shall forthwith on demand indemnify
the Issuing Bank for its Relevant Percentage of any
liability or loss incurred by the Issuing Bank in any way
relating to or arising out of its acting as the Issuing
Bank, except to the extent that the liability or loss
arises directly from the Issuing Bank's gross negligence
or wilful misconduct.
7. COUNTER-INDEMNITY
7.1 Indemnity from the Company
(a) The Company agrees to pay to the Agent for the account of
each Bank on demand from the Agent an amount equal to and
in the same currency as each amount demanded in
accordance with paragraph (b) below of, or paid out by,
the Bank under Clause 6.3 (Payment by the Banks) in
respect of the Guarantee and undertakes to indemnify and
hold harmless each Finance Party from and against all
liabilities, costs, losses, damages and expenses (other
than those of the type dealt with by Clauses 13.1 (Gross-
up) and 15.1 (Increased costs)) which any Finance Party
may incur or sustain by reason of or arising in any way
whatsoever in connection with or by reference to the
issue of the Guarantee or its performance of the
obligations expressed to be assumed by it under the
Guarantee save to the extent that any such liability,
cost, loss, damage or expense:
(i) is caused by the wilful misconduct, default or gross
negligence of the Finance Party concerned; or
(ii) represents a day to day cost of the Finance Party
incurred by it in the ordinary course of its
business in connection with or by reference to the
issue of the Guarantee or the performance of the
obligations expressed to be assumed by it under or
related to the Guarantee.
(b) The Company and each Bank unconditionally and
irrevocably:
(i) authorises and directs the Issuing Bank to pay any
prima facie valid demand under and in accordance
with the Guarantee issued for its account without
requiring proof of the agreement of the Company or
any Bank that the amounts so demanded or paid are or
were due and notwithstanding that the Company may
dispute the validity of any such request, demand or
payment;
(ii) confirm that the Issuing Bank deals in documents
only and shall not be concerned with the legality of
the claim or any other underlying transaction or any
set off, counterclaim or defence as between the
Company and any Beneficiary of the Guarantee; and
(iii) agree that the Issuing Bank need not have
regard to the sufficiency, accuracy or genuineness
of any such demand or any certificate or statement
in connection therewith or any incapacity of or
limitation upon the powers of any person signing or
issuing such demand, certificate or statement which
appears on its face to be in order and agree that
the Issuing Bank shall not be obliged to enquire as
to any such matters and may assume that any such
demand, certificate or statement which appears on
its face to be in order is correct and properly
made.
7.2 Waiver of defences
The Company agrees that its obligations under this
Clause 7 shall not be affected by any act, omission,
matter or thing which but for this provision might
operate to release or otherwise exonerate the Company
from its obligations under this Clause 7 in whole or in
part, including without limitation and whether or not
known to the Company:-
(a) any time or waiver granted by or composition with
any Finance Party, a Beneficiary or any other
person;
(b) any taking, variation, compromise, renewal or
release of, or refusal or neglect to perfect or
enforce, any rights, remedies or securities
available to any Finance Party or any other person
arising under the Finance Documents; or
(c) any variation or replacement of any Finance Document
or any other document so that references to that
Finance Document or other document shall include
each such variation or replacement.
7.3 Continuing indemnity
(a) The obligations of the Company under this Clause 7 shall
be continuing obligations, shall extend to the ultimate
balance of all amounts expressed to be payable by each
Borrower under the Finance Documents and shall continue
in force notwithstanding any intermediate payment in
whole or in part of amounts payable under this Clause 7.
(b) A certificate in writing signed by one of the Agent's
officers and certifying the total amount due from the
Company shall be prima facie evidence of the matters so
certified.
7.4 Rights of subrogation
Until all amounts which are or may become payable by the
Borrowers under the Finance Documents have been
irrevocably paid in full, the Company shall not, by
virtue of any payment made by it under or in connection
with or referable to this Clause 7 or otherwise, be
subrogated to any rights, security or moneys held or
received by any Finance Party 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
Finance Party.
7.5 Additional Security
The obligations of the Company under this Clause 7 shall
be in addition to and shall not be in any way prejudiced
by any collateral or other security now or hereafter held
by any Finance Party as security or any lien to which
that Finance Party may be entitled.
7.6 Preservation of Rights
No invalidity or unenforceability of all or any part of
this Clause 7 shall affect any rights of indemnity or
otherwise which any Finance Party would or may have in
the absence of or in addition to this Clause 7.
8. REPAYMENT
(a) Subject to paragraph (b) below, each Borrower shall repay
each Loan made to it in full on its Repayment Date to the
Agent for the Banks.
(b) (i) The Company shall, subject to sub-paragraph
(ii) below, repay each Facility B Loan on
the Facility B Final Repayment Date.
(ii) If, on the first anniversary of the date of this
Agreement:
(1) any amount is owing to the Banks under or in
respect of any Facility B Loan; and
(2) the Company has not procured an effective
guarantee of such amount on terms and from an
entity acceptable to all the Banks in their
sole discretion;
then Facility B Loans shall be repaid by the Company
on each date set out below in an amount equal to the
relevant percentage set opposite that date of the
then outstanding Facility B Loans:
Date Repayment Instalment
1st anniversary of the 20 per cent. of the
date Facility B Loans then
of this Agreement outstanding
15 months after the date 25 per cent. of the
of this Agreement Facility B Loans then
outstanding
18 months after the date 33 1/3 per cent. of the
of this Agreement Facility B Loans then
outstanding
21 months after the date 50 per cent. of the
of this Agreement Facility B Loans then
outstanding
2nd anniversary of the date 100 per cent. of the
of this Agreement Facility B Loans then
outstanding.
(c) Subject to the terms of this Agreement, amounts repaid
under Facility A or Facility C may subsequently be re-
borrowed.
9. PREPAYMENT AND CANCELLATION
9.1 Automatic cancellation of the Total Commitments
(a) The Facility A Commitment of each Bank shall be
automatically cancelled at close of business on the
Facility A Final Repayment Date.
(b) The Facility B Commitment of each Bank shall be
automatically cancelled at close of business on the
Facility B Term Date.
(c) The Facility C Commitment of each Bank shall be
automatically cancelled at close of business on the
Facility C Final Repayment Date.
9.2 Voluntary cancellation
(a) The Company may, by giving not less than 2 Business Days'
prior notice to the Agent, cancel the unutilised portion
of the Total Facility A Commitments or the Total
Facility B Commitments in whole or in part (but, if in
part, in a minimum amount of 10,000,000 pounds and an
integral multiple of 5,000,000 pounds). Any cancellation
in part shall be applied against the relevant Commitment
of each Bank pro rata.
(b) The Target may, by giving not less than 2 Business Days'
prior notice to the Agent, cancel the unutilised portion
of the Total Facility C Commitments in whole or in part
(but, if in part, in a minimum amount of 10,000,000 pounds
and an integral multiple of 5,000,000pounds). Any cancellation
in part shall be applied against the Facility C Commitment
of each Bank pro rata.
9.3 Voluntary prepayment
A Borrower may at any time, by giving not less than 5
Business Days' prior notice to the Agent, prepay a Loan
in whole or in part (but, if in part, in minimum amounts
of 10,000,000 pounds), subject to Clause 25 (Indemnities).
9.4 Additional right of prepayment and cancellation
If any Borrower is required to pay any amount to a Bank
under Clause 13 (Taxes) or Clause 15 (Increased Costs),
the Borrower may, whilst the circumstances giving rise to
the requirement continue, serve a notice of prepayment
and cancellation on that Bank through the Agent. In this
event:-
(a) on the date falling 5 Business Days after the date
of service of the notice:
(i) each Borrower shall prepay that Bank's
participation in any Loans made to it together
with all other amounts payable by it to that
Bank under this Agreement; and
(ii) the Company shall pay cash cover into a
Security Account in an amount equal to that
Bank's Relevant Percentage of the maximum
aggregate actual and contingent liability of
the Banks under the Guarantee; and
(b) the Bank's Commitments shall be cancelled on the
date of service of the notice.
9.5 Mitigation
If circumstances arise which would, or would on the
giving of notice, result in:
(a) any additional amounts becoming payable under
Clause 13.1 (Gross-up); or
(b) any amount becoming payable under Clause 15.1
(Increased costs); or
(c) any prepayment or cancellation under Clause 16
(Illegality),
then, without limiting the obligations of the Borrowers
under this Agreement and without prejudice to the terms
of Clauses 13.1 (Gross-up), 15.1 (Increased costs) and 16
(Illegality), each Bank shall, in consultation with the
Company, take such reasonable steps as may be open to it
to mitigate or remove the relevant circumstance,
including (without limitation) the transfer with the
Company's consent as specified in Clause 28.2 (Transfers
by Banks) of its rights and obligations under this
Agreement to another bank or financial institution,
unless to do so might (in the opinion of the Bank) have a
material adverse effect on its business, operations or
financial condition or be contrary to its banking
policies or be otherwise prejudicial to it.
9.6 Mandatory prepayment/cancellation
(a) (i) At any time when the Capitalisation Ratio is
stated (in a compliance certificate provided at the
end of each quarterly Accounting Period under
Clause 19.2(c)(ii) (Financial information)) to
exceed 65 per cent., the Company shall provide a
calculation of Available Surplus Cashflow, Surplus
Cashflow and Cashflow in that compliance
certificate.
(ii) At the same time as the Company delivers to the
Agent the compliance certificate referred to in
paragraph (a) above, it shall pay an amount equal
to:
(1) if, at that time, the Capitalisation
Ratio exceeds 70 per cent., 100 per cent. of
the Available Surplus Cashflow (or such lesser
amount as will, when applied by the Agent under
paragraph (c) below, reduce the Capitalisation
Ratio to 70 per cent.); and
(2) if, at that time, the Capitalisation
Ratio exceeds 65 per cent. but is equal to or
lower than 70 per cent., 50 per cent. of the
Available Surplus Cashflow at that time (or
such lesser amount as will, when applied by the
Agent under paragraph (c) below, reduce the
Capitalisation Ratio to 65 per cent.),
to the Agent to be placed in a Security Account.
(b) The Company shall, immediately upon receipt, pay an
amount equal to the net proceeds of any Subsequent
Capital Injection into a Security Account.
(c) (i) Subject to sub-paragraph (ii) below, the Agent
shall, on the last day of each Interest Period for a
Facility B Loan, apply the amount standing to the
credit of a Security Account and referred to in
paragraphs (a) and (b) above, together with any
interest accrued on that amount, in or towards
prepayment of the Facility B Loans.
(ii) The Company may require the Agent to apply the
net proceeds of a Subsequent Capital Injection at
any time prior to the date the Agent is required to
do so under sub-paragraph (i) above by giving 5
Business Days' notice to the Agent.
(d) Any amount in a Security Account in excess of the
Facility B Loans outstanding on the date of application
by the Agent under paragraph (c) above shall be applied
as follows:
(i) if applicable, an amount equal to the Minimum
Subsequent Capital Injection less the amount applied
in prepayment of the Facility B Loans will
(notwithstanding any other term of this Agreement)
be treated as Cashflow and, to the extent required
under paragraph (a) above, be applied in prepayment
of the Facility A Loans in accordance with this
Clause; and
(ii) if the net proceeds of any Subsequent Capital
Injection received by the Company exceed the Minimum
Subsequent Capital Injection, the amount of any
excess may, unless a Default is outstanding, be
distributed by the Company to the Parent.
The Total Facility B Commitments and the Total Facility A
Commitments shall be cancelled by the amount of any
prepayment of Facility B Loans or Facility A Loans, as
the case may be, on the date of the prepayment.
(e) If a MMC Referral occurs, then the unutilised portion of
the Total Commitments shall be automatically cancelled on
the following Business Day as though this was a voluntary
cancellation under Clause 9.2 (Voluntary cancellation).
The Company shall notify the Agent forthwith upon
becoming aware of a MMC Referral.
9.7 Mandatory reduction of Commitments
On the Reduction Date, the Total Facility A Commitments
and the Total Facility C Commitments shall be reduced by
the amount (if any) required to ensure that the
Capitalisation Ratio on that date does not exceed 65 per
cent.
9.8 Miscellaneous provisions
(a) Any notice of prepayment and/or cancellation under this
Agreement is irrevocable. The Agent shall notify the
Banks promptly of receipt of any such notice.
(b) All prepayments under this Agreement shall be made
together with accrued interest on the amount prepaid.
(c) No prepayment or cancellation is permitted except in
accordance with the express terms of this Agreement.
(d) (i) Subject to the terms of this Agreement, amounts
prepaid under Facility A and Facility C pursuant to
Clause 9.3 (Voluntary prepayment) may subsequently
be re-borrowed.
(ii) No other amount prepaid may subsequently be re-
borrowed.
(iii) No amount of the Total Commitments
cancelled under this Agreement may subsequently be
reinstated.
10. INTEREST PERIODS
10.1 Interest Periods
(a) Each Facility B Loan will have successive Interest
Periods. The first Interest Period will commence on the
Drawdown Date for that Facility B Loan and subsequent
Interest Periods will commence on expiry of its preceding
Interest Period.
(b) Each Facility A Loan and each Facility C Loan will have
one Interest Period only.
(c) Interest Periods may, subject to the other provisions of
this Clause 10, be for an approved duration or an
optional duration and:-
(i) "approved duration" means a period of 1, 3 or 6
months; and
(ii) "optional duration" means any other period (other
than an approved duration) of up to 12 months.
10.2 Selection of Interest Periods
(a) The Company may select an Interest Period for a
Facility B Loan in its Request (in the case of the first
Interest Period) or in a notice received by the Agent not
later than 9.00 a.m. on the Business Day before the
commencement of that Interest Period (in the case of
subsequent Interest Periods).
(b) If a Borrower fails to select a subsequent Interest
Period for a Facility B Loan in accordance with the
notice specified in paragraph (a) above, the Interest
Period will, subject to the other provisions of this
Clause 10, be 3 months.
(c) The relevant Borrower may select an Interest Period for
each Facility A Loan or Facility C Loan, as the case may
be, in its Request.
10.3 Selection of an optional duration
(a) If a Borrower selects an Interest Period of an optional
duration, it may also select in the relevant Request or
notice an Interest Period of an approved duration to
apply if the selection of an Interest Period of an
optional duration becomes ineffective in accordance with
paragraph (b) below.
(b) If:-
(i) a Borrower requests an Interest Period of an
optional duration; and
(ii) the Agent receives notice from a Bank not later than
3.00 p.m. on the Business Day before the beginning
of that Interest Period that it does not agree to
the request,
the Interest Period for the proposed Loan shall be the
alternative period of an approved duration specified in
the relevant Request or notice or, in the absence of any
alternative selection, 3 months.
(c) If the Agent receives a notice from a Bank under
paragraph (b) above, it shall notify the relevant
Borrower and the Banks promptly of the new Interest
Period for the proposed Loan.
10.4 Repayment Dates and the Reduction Date
(a) If an Interest Period for a Facility B Loan would
otherwise overrun the Facility B Final Repayment Date,
that Interest Period shall be shortened so that it ends
on the Facility B Final Repayment Date. If Clause
8(b)(ii) (Repayment) is applicable, the Agent may also
shorten any Interest Period for a Facility B Loan (and
may redesignate any Facility B Loan as two Facility B
Loans) to ensure that the aggregate principal amount of
Facility B Loans with an Interest Period ending on a
Facility B Repayment Date is not less than the Facility B
Repayment Instalment due on that Facility B Repayment
Date.
(b) If an Interest Period for a Facility A Loan or a
Facility C Loan would otherwise overrun the Reduction
Date or (as appropriate) the Facility A Final Repayment
Date or the Facility C Final Repayment Date, it shall be
shortened so that it ends on the Reduction Date or the
relevant Repayment Date, as the case may be.
10.5 Consolidation
Notwithstanding Clause 10.2 (Selection of Interest
Periods), the first Interest Period of each Facility B
Loan shall end on the same day as the then current
Interest Period for any other Facility B Loan. On the
last day of those Interest Periods, those Facility B
Loans shall be consolidated and treated as one Facility B
Loan.
10.6 Splitting
(a) The Company may give notice to the Agent by not later
than 9.00 am on the Business Day before the commencement
of an Interest Period for a Facility B Loan that it
wishes that Facility B Loan to be split into two or more
Facility B Loans, each such part being a minimum of
10,000,000 pounds.
(b) Each such part of a Facility B Loan will be treated as a
separate Facility B Loan.
(c) The Company may not split any Facility B Loan if, as a
result, there would then be more than 15 Utilisations
outstanding at that time.
10.7 Other adjustments
The Agent and the Company may enter into such other
arrangements as they may agree for the adjustment of
Interest Periods and the consolidation and/or splitting
of Facility B Loans.
10.8 Notification
The Agent shall notify the relevant Borrower and the
Banks of the duration of each Interest Period promptly
after ascertaining its duration.
11. INTEREST
11.1 Interest rate
(a) The rate of interest on each Loan for each of its
Interest Periods is the rate per annum determined by the
Agent to be the aggregate of the applicable:-
(i) Margin;
(ii) LIBOR; and
(iii) MLA Cost.
(b) If, in respect of any Accounting Period, the Company does
not comply with its obligations under Clause 19.2 (a)(i),
(b)(i) or (c) (Financial information), the applicable
Margin in respect of each Loan from the date of the
Company's non-compliance until the date on which that non-
compliance is remedied, shall be adjusted so that:
(i) prior to the date on which the Facility B Loans are
repaid or prepaid in full, the applicable Margin for
each Loan shall be 1.50 per cent. per annum
(adjusted, if necessary, to take into account the
application of paragraph (d) of the definition of
"Margin" in Clause 1.1 (Definitions)) or (if the non-
compliance occurs prior to the date falling six
months after the date of this Agreement) 1.25 per
cent. per annum; and
(ii) subsequently, the Margin applicable to each Facility
A Loan or Facility C Loan shall be the next
Increment up from the applicable Margin for that
Loan in the previous quarterly Accounting Period.
(c) For the purposes of paragraph (b) above, an "Increment"
is the difference between each level of the Margin in sub-
paragraphs (i) to (vii) of paragraph (a) of the
definition of "Margin" in Clause 1.1 (Definitions).
11.2 Due dates
Except as otherwise provided in this Agreement, accrued
interest on each Loan is payable by the relevant Borrower
on the last day of each Interest Period and also, in the
case of a Loan with an Interest Period longer than six
months, on the date falling six months after the
commencement of the Interest Period.
11.3 Default interest
(a) (i) If a Borrower fails to pay any amount payable
by it under the Finance Documents, it shall
forthwith on demand by the Agent pay interest on the
overdue amount from the due date up to the date of
actual payment, as well after as before judgement,
at a rate (the "default rate") determined by the
Agent to be 1 per cent per annum (or, at any time
prior to the date on which the Facility B Loans are
repaid or prepaid in full, 2 per cent. per annum)
above, subject to sub-paragraph (ii) below, the rate
which would have been payable if the overdue amount
had, during the period of non-payment, constituted a
Sterling Loan for such successive Interest Periods
of such duration as the Agent may reasonably
determine having regard to the likely duration of
the default (each a "Designated Interest Period").
(ii) If the overdue amount is a principal amount of a
Loan and it becomes due and payable prior to the
last day of an Interest Period for that Loan, then:-
(1) the first Designated Interest Period for that
overdue sum will be the unexpired portion of
that Interest Period; and
(2) the rate of interest on the overdue amount for
that first Designated Interest Period will be 1
per cent per annum or (at any time prior to the
date on which the Facility B Loans are repaid
or prepaid in full) 2 per cent. per annum above
the rate on the overdue amount under
Clause 11.1 (Interest rate) immediately before
the due date.
After the expiry of the first Designated Interest
Period for that overdue amount, the rate on the
overdue amount will be calculated in accordance with
sub-paragraph (i) above.
(b) The default rate will be determined on each Business Day
or the first day of the relevant Designated Interest
Period, as appropriate.
(c) If the Agent determines that Sterling deposits are not at
the relevant time being made available by the Reference
Banks to leading banks in the London interbank market,
the default rate will be determined by reference to the
cost of funds to the Banks from whatever sources Banks
may reasonably select, having due regard to the likely
duration of the default.
(d) Default interest will be compounded at the end of each
Designated Interest Period.
11.4 Notification of rates of interest
The Agent shall promptly notify each relevant Party of
the determination of a rate of interest under this
Agreement.
12. PAYMENTS
12.1 Place
All payments by a Borrower or a Bank under the Finance
Documents shall be made to the Agent to its account at
such office or bank in the U.K. as it may notify to that
Borrower or Bank for this purpose.
12.2 Currency and Funds
Payments under the Finance Documents to the Agent shall
be made in Sterling for value on the due date at such
times as the Agent may specify to the Party concerned as
being customary at the time for the settlement of
transactions in Sterling.
12.3 Distribution
(a) Each payment received by the Agent under this Agreement
for another Party shall, subject to the paragraphs below,
be made available by the Agent to that Party by payment
to its account with such bank in the U.K. as it may
notify to the Agent for this purpose by not less than 5
Business Days' prior notice.
(b) Where the Repayment Date for an outstanding Facility A
Loan or Facility C Loan coincides with the Drawdown Date
for a new Facility A Loan or Facility C Loan, as the case
may be, the Agent shall apply the relevant new Loan in or
towards repayment of the relevant outstanding Loan so
that:-
(i) where the amount of the outstanding Loan exceeds the
amount of the new Loan, the relevant Borrower shall
only be required to repay the excess; and
(ii) where the amount of the outstanding Loan is exactly
the same as the amount of the new Loan, the relevant
Borrower shall not be required to make any payment.
(c) The Agent may apply any amount received by it for a
Borrower in or towards payment (on the date and in the
currency and funds of receipt) of any amount due from a
Borrower under this Agreement or in or towards the
purchase of any amount of any currency to be so applied.
(d) Where a sum is to be paid under this Agreement to the
Agent for the account of another Party, the Agent is not
obliged to pay that sum to that Party until it has
established that it has actually received that sum. The
Agent may, however, assume that the sum has been paid to
it in accordance with this Agreement and, in reliance on
that assumption, make available to that Party a
corresponding amount. If the sum has not been made
available but the Agent has paid a corresponding amount
to another Party, that Party shall forthwith on demand
refund the corresponding amount to the Agent together
with interest on that amount from the date of payment to
the date of receipt, calculated at a rate determined by
the Agent to reflect its cost of funds.
12.4 Set-off and counterclaim
All payments made by a Borrower under the Finance
Documents shall be made without set-off or counterclaim.
12.5 Non-Business Days
(a) If a payment under the Finance Documents is due on a day
which is not a Business Day, the due date for that
payment shall instead be the next Business Day in the
same calendar month (if there is one) or the preceding
Business Day (if there is not).
(b) During any extension of the due date for payment of any
principal under this Agreement interest is payable on the
principal at the rate payable on the original due date.
12.6 Partial payments
(a) If the Agent receives a payment insufficient to discharge
all the amounts then due and payable by the Borrowers
under the Finance Documents, the Agent shall apply that
payment towards the obligations of the Borrowers under
the Finance Documents in the following order:-
(i) first, in or towards payment pro rata of any unpaid
fees, costs and expenses of the Agent and the
Issuing Bank under this Agreement;
(ii) secondly, in or towards payment pro rata of any
accrued fees due but unpaid under Clause 22.2
(Commitment fee);
(iii) thirdly, in or towards payment pro rata of any
accrued interest and guarantee fee due but unpaid
under this Agreement;
(iv) fourthly, in or towards payment pro rata of any
principal due but unpaid under this Agreement and
any amount payable under the Swap Documents; and
(v) fifthly, in or towards payment pro rata of any other
sum due but unpaid under this Agreement.
(b) The Agent shall, if so directed by all the Banks, vary
the order set out in sub-paragraphs (a)(ii) to (v) above.
(c) Paragraphs (a) and (b) above shall override any
appropriation made by a Borrower.
13. TAXES
13.1 Gross-up
All payments by a Borrower under the Finance Documents
shall be made without any deduction and free and clear of
and without deduction for or on account of any taxes,
except to the extent that the Borrower is required by law
to make payment subject to any taxes. If any tax or
amounts in respect of tax must be deducted, or any other
deductions must be made, from any amounts payable or paid
by a Borrower, or paid or payable by the Agent to a Bank,
under the Finance Documents, the Borrower shall pay such
additional amounts as may be necessary to ensure that the
relevant Bank receives a net amount equal to the full
amount which it would have received had payment not been
made subject to tax or other deduction.
13.2 Tax receipts
All taxes required by law to be deducted or withheld by a
Borrower from any amounts paid or payable under the
Finance Documents shall be paid by the relevant Borrower
when due and the Borrower shall, within 15 days of the
payment being made, deliver to the Agent for the relevant
Bank evidence satisfactory to that Bank (including all
relevant tax receipts) that the payment has been duly
remitted to the appropriate authority.
13.3 Refund of Tax Credits
If:-
(a) a Borrower makes a payment under Clause 13.1 (Gross-
up) (a "Tax Payment") in respect of a payment to a
Bank under the Finance Documents; and
(b) that Bank determines in good faith that it has
obtained a refund of tax or obtained and used a
credit against tax on its overall net income (a "Tax
Credit") which that Bank is able to identify in good
faith as attributable to that Tax Payment,
then, if it determines, acting in good faith, that it can
do so without any adverse consequences for the Bank, that
Bank shall forthwith reimburse that Borrower, such amount
as that Bank in its absolute discretion determines to be
such proportion of that Tax Credit as will leave that
Bank (after that reimbursement) in no better or worse
position in respect of its worldwide tax liabilities than
it would have been in if no Tax Payment had been
required. A Bank shall have an absolute discretion as to
whether to claim any Tax Credit (and, if it does claim,
the extent, order and manner in which it does so) and
whether any amount is due from it under this Clause 13.3)
(and, if so, what amount and when). No Bank shall be
obliged to disclose any information regarding its tax
affairs and computations.
13.4 Qualifying Bank
(a) Each Bank party to this Agreement on the date of this
Agreement represents that it is a Qualifying Bank on the
date of this Agreement. Any bank or financial
institution which becomes a Bank after the date of this
Agreement represents to the Company on the date it
becomes a Party that, as at that date, it is a Qualifying
Bank.
(b) If, otherwise than as a result of the introduction of,
change in, or any change in the interpretation,
administration or application of, any law or regulation,
any Double Taxation Treaty or any practice or concession
of the United Kingdom Inland Revenue occurring after the
date a Bank becomes a Party, the Bank is not or ceases to
be a Qualifying Bank, the Company will not be liable to
pay to that Bank under Clause 13.1 (Gross-up) any amount
in respect of taxes levied or imposed by the United
Kingdom or any taxing authority of or in the United
Kingdom in excess of the amount it would have been
obliged to pay if that Bank had been or had not ceased to
be a Qualifying Bank.
(c) Any Bank which falls within paragraph (b) of the
definition of Qualifying Bank shall deliver to the
Company, on the date it becomes a Bank, a duly completed
form from the tax authorities in the country in which it
is booking its participation in a Loan such that the
Company may apply to the Inland Revenue for a direction
to the Company under the Double Taxation Relief (Taxes on
Income) (General) Regulations 1970 that the Company
should not, on account of the relevant Double Taxation
Treaty, pay any interest due to the Bank under the
Finance Documents under deduction of United Kingdom tax.
The Bank concerned shall, upon the request of the
Company, promptly and duly (if it is able to do so)
execute and deliver any and all such further instruments
and documents which are required for the purpose of
obtaining such a direction.
(d) Each Bank shall notify the Company through the Agent as
soon as it is aware that it ceases to be a Qualifying
Bank.
14. MARKET DISRUPTION
(a) If a Reference Bank does not supply an offered rate by
11.30 a.m. on a Drawdown Date, the applicable LIBOR
shall, subject to paragraph (b) below, be determined on
the basis of the quotations of the remaining Reference
Banks.
(b) If, in relation to any proposed Loan:-
(i) no, or only one, Reference Bank supplies a rate for
the purposes of determining the applicable LIBOR or
the Agent otherwise determines that adequate and
fair means do not exist for ascertaining the
applicable LIBOR; or
(ii) the Agent receives notification from Banks whose
participations in a Loan exceed 50 per cent. of that
Loan that, in their opinion:-
(A) matching deposits may not be available to them
in the London interbank market in the ordinary
course of business to fund their participations
in that Loan for the relevant Interest Period;
or
(B) the cost to them of matching deposits in the
London interbank market would be in excess of
the relevant LIBOR,
the Agent shall promptly notify the Company and the
relevant Banks of the fact and that this Clause 14 is in
operation.
(c) After any notification under paragraph (b) above:-
(i) (A) in the case of a Loan which has not been
made, unless the relevant Borrower notifies the
Agent to the contrary before close of business
on the day it received the notification under
paragraph (b) above, the Loan shall still be
made but it shall have an Interest Period of
one month and the interest payable on that Loan
shall be determined in accordance with sub-
paragraphs (ii) to (vi) below; and
(B) in the case of a Facility B Loan after it has
been borrowed, that Facility B Loan shall
continue but it shall have an Interest Period
of one month and the interest payable on that
Loan shall be determined in accordance with sub-
paragraphs (ii) to (vi) below;
(ii) promptly after receipt of the notification, the
relevant Borrower and the Agent shall enter into
negotiations in good faith for a period of not more
than one month with a view to agreeing a substitute
basis for determining the rate of interest and/or
funding applicable to the Loan affected by the
notification;
(iii) any substitute basis agreed under sub-paragraph
(ii) above shall be, with the prior consent of all
the Banks, binding on all the Parties;
(iv) if no substitute basis is agreed under sub-
paragraph (ii) above, each Bank (through the Agent)
shall certify on or before the last day of the
Interest Period to which the notification relates an
alternative basis for maintaining its participation
in that Loan;
(v) any alternative basis referred to in sub-paragraph
(iv) above may include an alternative method of
fixing the interest rate, alternative Interest
Periods or alternative currencies but it must
reflect the cost to the Banks of funding their
participations in that Loan from whatever sources
each relevant Bank may reasonably select (each
Bank's cost of funding being certified by that Bank
with a copy to the Agent) plus the Margin and (if
applicable) any MLA Cost; and
(vi) each alternative basis so certified shall be binding
on the Borrowers and the certifying Bank and treated
as part of this Agreement.
15. INCREASED COSTS
15.1 Increased costs
(a) Subject to Clause 15.2 (Exceptions), the Company shall
forthwith on demand by a Finance Party pay that Finance
Party the amount of any increased cost incurred by it as
a result of:
(i) the introduction of, or any change in, or any change
in the interpretation or application of, any law or
regulation after the date of this Agreement; or
(ii) compliance with any regulation made after the date
of this Agreement,
including any law or regulation relating to taxation,
change in currency of a country or reserve asset, special
deposit, cash ratio, liquidity or capital adequacy
requirements or any other form of banking or monetary
control.
(b) In this Agreement "increased cost" means:-
(i) an additional cost incurred by a Finance Party or
its Holding Company as a result of the Finance Party
having entered into, or performing, maintaining or
funding its obligations under, this Agreement; or
(ii) that portion of an additional cost incurred by a
Finance Party or its Holding Company in the Finance
Party making, funding or maintaining all or any
advances comprised in a class of advances formed by
or including the participations in the Loans made or
to be made under this Agreement as is attributable
to the Finance Party making, funding or maintaining
those participations; or
(iii) a reduction in any amount payable to a Finance
Party or its Holding Company or the effective return
to a Finance Party under this Agreement or on its
capital or that of its Holding Company; or
(iv) the amount of any payment made by a Finance Party or
its Holding Company, or the amount of interest or
other return foregone by a Finance Party or its
Holding Company, calculated by reference to any
amount received or receivable by a Finance Party
from any other Party under this Agreement.
15.2 Exceptions
Clause 15.1 (Increased costs) does not apply to any
increased cost:-
(a) compensated for by the payment of the MLA Cost;
(b) compensated for by the operation of Clause 13
(Taxes) or which would have been compensated for but
for the operation of Clause 13.4(b) (Qualifying
Bank);
(c) attributable to any change in the rate of tax on the
overall net income of a Bank or its Holding Company
(or the overall net income of a division or branch
of the Bank or its Holding Company) imposed in the
jurisdiction in which its principal office or
Facility Office is situate;
(d) attributable to the relevant Bank (or its Holding
Company) having entered into a commitment to lend to
a third party which is, at the time of that
commitment, in breach of the relevant law or
regulation; or
(e) incurred in consequence of the implementation, as
contemplated at the date of this Agreement, of the
matters set out in:
(i) the report of the Basle Committee on Bank
Regulation and Supervisory Practices dated July
1988 and entitled "International Convergence of
Capital Measurement and Capital Standards"
(including in particular but without limitation
any directive of the Bank of England
implementing that report in the United
Kingdom);
(ii) the Directive of the Council of the European
Communities on a Solvency Ratio for Credit
Institutions (89/647/EEC of 18 December 1989);
and/or
(iii) the Directive of the Council of the
European Communities on Own Funds of Credit
Institutions (89/299/EEC of 17 April 1989),
unless it results from any change after the date of
this Agreement in, or in the interpretation or
application of, those matters as contemplated on the
date of this Agreement.
16. ILLEGALITY
If it is or becomes unlawful or contrary to any
regulation in any jurisdiction for a Bank to give effect
to any of its obligations as contemplated by this
Agreement or to fund or maintain its participation in any
Loan, then:-
(a) the Bank shall promptly notify the Company through
the Agent accordingly; and
(b) (i) each Borrower shall, on the latest day
permitted by the relevant law or regulation,
prepay that Bank's participation in all Loans
made to it together with all other amounts
payable by it to that Bank under this
Agreement; and
(ii) the Bank's Commitments shall be cancelled;
(iii) if the Bank is the Issuing Bank and the
Guarantee has not yet been issued, the
Guarantee shall not be issued; and
(iv) if the Guarantee has been issued, demand that
the Company shall, on the latest date permitted
by the relevant law or regulation, provide cash
cover to it in a Security Account in an amount
equal to that Bank's Relevant Percentage of
(or, if the Bank is the Issuing Bank, an amount
equal to) the maximum aggregate actual and
contingent liability of the Banks under the
Guarantee. In this event, the Company shall
use reasonable endeavours to procure the
release of the Bank from its obligations under
the Finance Documents and, to the extent that
the Bank is released from its obligations under
the Finance Documents, the Bank shall repay to
the Company any amount provided to that Bank by
way of cash cover together with interest on the
amount which that Bank reasonably considers
that it has earned on the amount during the
period for which the cash cover was retained by
it.
17. GUARANTEE
17.1 Guarantee
The Company irrevocably and unconditionally:-
(a) as principal obligor guarantees to each Finance
Party prompt performance by the Target of all its
obligations under the Finance Documents;
(b) undertakes with each Finance Party that whenever the
Target does not pay any amount when due under or in
connection with any Finance Document, the Company
shall within two Business days of demand by the
Agent pay that amount as if the Company instead of
the Target were expressed to be the principal
obligor; and
(c) indemnifies each Finance Party on demand against any
loss or liability suffered by it if any obligation
so guaranteed by the Company is or becomes
unenforceable, invalid or illegal.
17.2 Continuing guarantee
This guarantee is a continuing guarantee and will extend
to the ultimate balance of all sums payable by the Target
under the Finance Documents, regardless of any
intermediate payment or discharge in whole or in part.
17.3 Reinstatement
(a) Where any discharge (whether in respect of the
obligations of the Target or any security for those
obligations or otherwise) is made in whole or in part or
any arrangement is made on the faith of any payment,
security or other disposition which is avoided or must be
restored on insolvency, liquidation or otherwise without
limitation, the liability of the Company under this
Clause 17 (Guarantee) shall continue as if the discharge
or arrangement had not occurred.
(b) Each Finance Party may concede or compromise any claim
that any payment, security or other disposition is liable
to avoidance or restoration.
17.4 Waiver of defences
The obligations of the Company under this Clause 17
(Guarantee) will not be affected by an act, omission,
matter or thing which, but for this provision, would
reduce, release or prejudice any of its obligations under
this Clause 17 (Guarantee) or prejudice or diminish those
obligations in whole or in part, including (whether or
not known to it or any Finance Party):-
(a) any time or waiver granted to, or composition with,
the Target or other person;
(b) the taking, variation, compromise, exchange, renewal
or release of, or refusal or neglect to perfect,
take up or enforce, any rights against, or security
over assets of, the Target or other person or any
non-presentation or non-observance of any formality
or other requirement in respect of any instrument or
any failure to realise the full value of any
security;
(c) any incapacity or lack of powers, authority or legal
personality of or dissolution or change in the
members or status of the Target or any other person;
(d) any variation (however fundamental) or replacement
of a Finance Document or any other document or
security so that references to that Finance Document
in this Clause 17 (Guarantee) shall include each
variation or replacement;
(e) any unenforceability, illegality or invalidity of
any obligation of any person under any Finance
Document or any other document or security, to the
intent that the obligations of the Company under
this Clause 17 (Guarantee) shall remain in full
force and its guarantee be construed accordingly, as
if there were no unenforceability, illegality or
invalidity; or
(f) any postponement, discharge, reduction, non-
provability or other similar circumstance affecting
any obligation of the Target under a Finance
Document resulting from any insolvency, liquidation
or dissolution proceedings or from any law,
regulation or order so that each such obligation
shall for the purposes of the obligations of the
Company under this Clause 17 (Guarantee) be
construed as if there were no such circumstance.
17.5 Immediate recourse
The Company waives any right it may have of first
requiring any Finance Party (or any trustee or agent on
its behalf) to proceed against or enforce any other
rights or security or claim payment from the Target
before claiming from the Company under this Clause 17
(Guarantee).
17.6 Appropriations
Until all amounts which may be or become payable by the
Target under or in connection with the Finance Documents
have been irrevocably paid in full, each Finance Party
(or any trustee or agent on its behalf) may:-
(a) refrain from applying or enforcing any other moneys,
security or rights held or received by that Finance
Party (or any trustee or agent on its behalf) in
respect of those amounts, or apply and enforce the
same in such manner and order as it sees fit
(whether against those amounts or otherwise) and the
Target shall not be entitled to the benefit of the
same; and
(b) hold in an interest bearing suspense account any
moneys received from the Company or on account of
the liability of the Company under this Clause 17
(Guarantee).
17.7 Non-competition
Until all amounts which may be or become payable by the
Target under or in connection with the Finance Documents
have been irrevocably paid in full, the Company shall not
after a claim has been made or by virtue of any payment
or performance by it under this Clause 17 (Guarantee):-
(a) be subrogated to any rights, security or moneys
held, received or receivable by any Finance Party
(or any trustee or agent on its behalf) or be
entitled to any right of contribution or indemnity
in respect of any payment made or moneys received on
account of the Company's liability under this
Clause 17 (Guarantee);
(b) claim, rank, prove or vote as a creditor of the
Target or its estate in competition with any Finance
Party (or any trustee or agent on its behalf); or
(c) receive, claim or have the benefit of any payment,
distribution or security from or on account of the
Target, or exercise any right of set-off as against
the Target.
The Company shall hold in trust for and forthwith pay or
transfer to the Agent for the Finance Parties any payment
or distribution or benefit of security received by it
contrary to this Clause 17.7.
17.8 Additional security
This guarantee is in addition to and is not in any way
prejudiced by any other security now or subsequently held
by any Finance Party.
18. REPRESENTATIONS AND WARRANTIES
18.1 Representations and warranties
(a) The Company makes the representations and warranties set
out in this Clause 18 (Representations and warranties) to
each Finance Party.
(b) The Target makes the representations and warranties
expressed to be made by it in this Clause 18
(Representations and warranties) in respect of itself and
its Subsidiaries only.
18.2 Status
(a) It is a limited liability company, duly incorporated and
validly existing under the Companies Act 1985;
(b) it has the power to own its assets and carry on its
business as it is being conducted; and
(c) as at the date of this Agreement, the Parent is the
beneficial owner of all the shares in the Company.
18.3 Powers and authority
It has the power to enter into and perform, and has taken
all necessary action to authorise the entry into,
performance and delivery of, the Finance Documents to
which it is or will be a party and the transactions
contemplated by those Finance Documents.
18.4 Legal validity
Each Finance Document to which it is or will be a party
constitutes, or when executed in accordance with its
terms will constitute, its legal, valid, binding and
enforceable obligation.
18.5 Non-conflict
The entry into and performance by it of, and the
transactions contemplated by, the Finance Documents do
not and will not:-
(a) conflict with any law or regulation, judicial or
official order or any Licence or Licence
Undertaking; or
(b) conflict with its constitutional documents; or
(c) conflict with any document which is binding upon any
member of the Group or any asset of any member of
the Group (other than a financing agreement to which
the Target or any Subsidiary of the Target is a
party, the Borrowing in respect of which is
refinanced prior to the Clean-Up Date) to an extent
or in a manner which has a Material Adverse Effect.
18.6 No default
(a) No Event of Default or (unless this representation is
being repeated or deemed to be repeated on the date of a
Request or a Drawdown Date in respect of a Rollover Loan)
other Default is outstanding or will result from any
Utilisation; and
(b) with effect from the Clean-Up Date, no other event is
outstanding which constitutes a default under any
document which is binding on any member of the Group or
any asset of any member of the Group to an extent or in a
manner which has a Material Adverse Effect.
18.7 Authorisations
Subject to due registration of the Debenture at Companies
House under section 395 of the Companies Act 1985, all
authorisations required by the laws of England or the
terms of any Licence or Licence Undertaking in connection
with the entry into, performance, validity and
enforceability of, and the transactions contemplated by,
the Finance Documents have been obtained or effected (as
appropriate) and are in full force and effect.
18.8 Accounts
(a) In the case of the Company, the audited consolidated
accounts of the Group most recently delivered to the
Agent under this Agreement:-
(i) have been prepared in accordance with Applicable
Accounting Principles; and
(ii) fairly represent the consolidated financial
condition of the Group as at the date to which they
were drawn up.
(b) In the case of the Target, its audited consolidated
accounts most recently delivered to the Agent:-
(i) have been prepared in accordance with Applicable
Accounting Principles; and
(ii) fairly represent its consolidated financial
condition as at the date to which they were drawn
up.
18.9 Litigation
No litigation, arbitration or administrative proceedings
are current or, to its knowledge, pending or threatened:
(a) to restrain the entry into, exercise of any of its
rights, and/or performance or enforcement of or
compliance with any of its obligations, under the
Finance Documents; or
(b) which have a Material Adverse Effect.
18.10 Information
(a) All material written factual information supplied by it
to the Finance Parties (including any such information
contained in any package of information provided or to be
provided by the Arrangers on behalf of the Company to
potential sub-underwriters) in connection with the
Finance Documents before, on or after the date of this
Agreement is true, complete and accurate in all material
respects as at its date;
(b) that information did not omit as at its date any
information which would make the information supplied
misleading in any material respect;
(c) any expressions of opinion or intention and any forecasts
and projections (including, without limitation, in
relation to the financial model referred to in
paragraph 9 of Schedule 2 Part I) contained in that
information were arrived at after careful consideration
and were based on reasonable assumptions;
(d) as at the date of this Agreement, nothing has occurred
(which has not been disclosed to the Arrangers prior to
the date of this Agreement) between the date the
information was provided and the date of this Agreement
which renders the information contained in it untrue or
misleading in any material respect; and
(e) the Press Release and the Offer Documents and any other
public documents relating to the Offer furnished to the
Agent contain all the material terms of the Offer and the
Offer Documents reflect the terms of the Press Release in
all material respects.
18.11 Information Memorandum
(a) All material factual information contained in the
Information Memorandum was true (or, in the case of
information provided by any person other than the Company
or its advisers, was true to the best of its knowledge
and belief) in all material respects at the date (if any)
ascribed to it in the Information Memorandum or (if none)
at the date of the relevant component of the Information
Memorandum;
(b) any expressions of opinion or intention and any forecasts
and projections contained in the Information Memorandum
were arrived at after careful consideration and were
based on reasonable assumptions;
(c) as at the date of the Syndication Agreement, the
Information Memorandum, taken as a whole, was not
misleading in any material respect and did not omit to
disclose any matter failure to disclose which would
result in any material information contained in the
Information Memorandum being misleading in any material
respect in the context of the Finance Documents.
18.12 Environmental Matters
With effect from the Clean-Up Date:
(a) each member of the Group has obtained all material
Environmental Licences required for the carrying on
of its business as then conducted and is in
compliance in all material respects with:
(i) the terms and conditions of those Environmental
Licences; and
(ii) all other applicable Environmental Law,
which, in each case, if not obtained or complied
with, has a Material Adverse Effect and there are,
to its knowledge, no circumstances which may
materially prevent or interfere with such compliance
in the future;
(b) so far as the Company is aware (after due enquiry),
no Dangerous Substance has been used, disposed of,
generated, stored, transported, dumped, released,
deposited, buried or emitted at, on from or under
any site or premises (whether or not owned, leased,
occupied or controlled by any member of the Group
and including any offsite waste management or
disposal location utilised by any member of the
Group) in circumstances where this has a Material
Adverse Effect; and
(c) so far as the Company is aware (after due enquiry),
there is no Environmental Claim (whether in respect
of any site previously or currently owned or
occupied by any member of the Group or otherwise)
pending or threatened, and there are no past or
present acts, omissions, events or circumstances
that would be likely to form the basis of any
Environmental Claim (whether in respect of any site
previously or currently owned or occupied by any
member of the Group or otherwise), against it which,
in each case, is reasonably likely to be determined
against it and which, if so determined, has a
Material Adverse Effect.
18.13 Assets
Each Borrower is the legal and/or beneficial owner of all
its assets free from any Security Interests (other than
any Security Interests permitted under Clause 19.9(b)
(Negative pledge)).
18.14 No Commitment
As at the first Utilisation Date, the Company does not
have any material commitments or Financial Indebtedness
other than those arising under the Finance Documents, the
Offer, any Offer Costs or in respect of the Licence or
any Licence Undertaking.
18.15 Licence
With effect from the Clean-Up Date:
(a) the Licence is in full force and effect;
(b) there exist no material breaches of the terms
of the Licence or Licence Undertakings; and
(c) there are no circumstances in existence which
would entitle the Director General or the Secretary
of State to seek to revoke the Licence.
18.16 Times for making representations and warranties
The representations and warranties set out in this
Clause 18 (Representations and warranties):-
(a) (i) in the case of the Company:
(A) are made by the Company, unless
it is expressly provided to the contrary,
on the date of this Agreement; or
(B) in the case of Clause 18.11
(Information Memorandum), is deemed to be
made by the Company on the date of the
Syndication Agreement (but only if this
date is no longer than 6 months after the
Unconditional Acceptances Date); and
(ii) in the case of the Target, will be deemed to be
made by it on the date it executes a Borrower
Accession Agreement; and
(b) (with the exception of Clauses 18.2(c) (Status)
and 18.11 (Information Memorandum)) are deemed to be
made by each Borrower on the date of each Request
and each Drawdown Date with reference to the facts
and circumstances then existing, except that, during
the Certain Funds Period for an Offer Utilisation,
only the representations and warranties of the
Company in Clauses 18.2(a) (Status), 18.3 (Powers
and authority), 18.4 (Legal validity) and 18.5 (Non-
conflict) will be deemed to be made by the Company
on the date of each Request and each Utilisation
Date for an Offer Utilisation with reference to the
facts and circumstances then existing.
18.17 Qualifications to representations
The representations and warranties contained in Clauses
18.4 (Legal validity) and 18.7 (Authorisations) shall
(where applicable) be subject, as to matters of law only,
to the qualifications in the legal opinions referred to
in paragraph 10 of Schedule 2 Part I and paragraph 9 of
Schedule 2 Part II.
19. UNDERTAKINGS
19.1 Duration
The undertakings in this Clause 19 (Undertakings) remain
in force from the date of this Agreement for so long as
any amount is or may be outstanding under this Agreement
or any Commitment is in force.
19.2 Financial information
The Company shall supply to the Agent in sufficient
copies for all the Banks:-
(a) as soon as the same are available (and in any event
within 120 days of the end of each of its financial
years):-
(i) the audited consolidated accounts of the Group
for that financial year; and
(ii) the audited consolidated accounts of the Target
and its Subsidiaries for that financial year;
(b) as soon as the same are available (and in any event
within 60 days of the end of the first half-year of
each of its financial years and within 45 days of
the end of each quarter of each of its financial
years):-
(i) the unaudited consolidated accounts of the
Group for that half-year or that quarter, as
the case may be; and
(ii) the unaudited consolidated accounts of the
Target and its Subsidiaries for that half-year
or that quarter, as the case may be; and
(c) (i) together with the accounts specified
in paragraph (a)(i) above, a certificate signed
by its auditors setting out in reasonable
detail computations establishing compliance or
non-compliance with Clause 19.28 (Financial
covenants) as at the date to which those
accounts were drawn-up;
(ii) together with the accounts specified in
paragraph (b)(i) above, a certificate signed by
two of its senior authorised officers on its
behalf setting out in reasonable detail
computations establishing compliance or non-
compliance with Clause 19.28 (Financial
covenants) as at the date to which those
accounts were drawn-up; and
(d) within 5 Business Days of them being delivered to
the Director General under Condition 2 of Part II of
the Licence, the accounting statements delivered to
the Director General by the Target.
19.3 Information - miscellaneous
Each Borrower shall supply to the Agent:-
(a) all documents despatched by it (in the case of the
Target) to its public shareholders (or any class of
them) or (in the case of either Borrower) its
creditors (or any class of them), other than any
creditors in respect of Subordinated Debt, at the
same time as they are despatched;
(b) promptly upon becoming aware of them, details of any
litigation, arbitration or administrative
proceedings which are current, threatened or
pending, and which:
(i) if adversely determined, have a Material
Adverse Effect; or
(ii) would involve liability or potential liability
of 10,000,000 pounds or more (or its equivalent
in other currencies); or
(iii) involves the Director-General, the
Secretary of State, the Licence or any Licence
Undertaking;
(c) during the period from the date of issue and
approval of the Information Memorandum by the
Company to the earlier of:
(i) the date six months after the Unconditional
Acceptances Date; and
(ii) the close of Syndication as determined and
confirmed to the Company by the Agent,
in reasonable detail notice of any matters of which
it is aware (whether occurring prior to, on or after
the date of approval and issue of the Information
Memorandum) which cause the Information Memorandum
when read without knowledge of such matters to be
inaccurate or misleading in any material respect;
(d) promptly upon becoming aware that any material
modifications to the Licence are being proposed by
the Director General or the Target and/or that any
Licence Undertaking is being requested by the
Director General or the Secretary of State,
reasonable details of those modifications and/or
that Licence Undertaking, to be updated from time to
time to reflect any changes;
(e) unless the Agent has already received them, copies
of any Licence Undertakings in force at the date the
Target becomes a Subsidiary of the Company and,
thereafter, promptly after the giving of any Licence
Undertaking; and
(f) promptly, such further information in the possession
or control of any member of the Group regarding its
financial condition and operations as any Finance
Party may reasonably request and which the Company
is able to provide without breaching any legal
obligation or regulation,
in sufficient copies for all of the Banks, if the Agent
so requests.
19.4 Notification of Default
Each Borrower shall notify the Agent of any Default (and
the steps, if any, being taken to remedy it) promptly
upon becoming aware of its occurrence.
19.5 Compliance certificates/accounting matters
(a) The Company shall supply to the Agent:-
(i) together with the accounts specified in
Clause 19.2(a)(i) and (b)(i) (Financial
Information); and
(ii) promptly at any other time, if the Agent so
requests,
a certificate signed by two of its senior officers on its
behalf certifying that no Default is outstanding or, if a
Default is outstanding, specifying the Default and the
steps, if any, being taken to remedy it.
(b) If, at any time after the date of this Agreement, any
material change is made to the Applicable Accounting
Principles, the Company shall notify the Agent of the
change and, in the absence of any agreement between the
Company and the Agent (acting on the instructions of the
Majority Banks) to the contrary, the Company shall ensure
that the Auditors provide a description of the change and
the adjustments which would be required to be made to the
latest accounts or financial statements so that those
accounts or financial statements reflect the Applicable
Accounting Principles, and any reference to any financial
statements or accounts delivered under this Agreement
shall be construed as a reference to those accounts or
financial statements as adjusted to reflect the
Applicable Accounting Principles.
(c) The Company shall ensure that each set of accounts to be
delivered by it under this Agreement are prepared and
audited (in the case of its annual accounts) by the
Auditors in accordance with the Applicable Accounting
Principles, subject to any variations which are not
material or, if material, have been agreed in writing by
the Majority Banks.
19.6 Authorisations
Each Borrower shall promptly:-
(a) obtain, maintain and comply with the terms of; and
(b) supply certified copies to the Agent of,
any authorisation required under any law or regulation to
enable it to perform its obligations under, or for the
validity or enforceability of, any Finance Document.
19.7 Environmental matters
The Company shall, and shall (after the Clean-Up Date)
procure that each member of the Group will:
(a) obtain all requisite Environmental Licences and
comply in all material respects with:
(i) the terms and conditions of all Environmental
Licences applicable to it; and
(ii) all other applicable Environmental Laws,
in each case where failure to do so has a Material
Adverse Effect; and
(b) promptly upon receipt of the same, notify the Agent
of any claim, notice or other communication served
on it in respect of any alleged breach of or
corrective or remedial obligation or liability under
any Environmental Law which would, if substantiated,
have a Material Adverse Effect.
19.8 Pari passu ranking
Each Borrower shall procure that its payment obligations
under the Finance Documents do and will rank at least
pari passu with all its other present and future
unsecured payment obligations, except for obligations
which are mandatorily preferred by law applying to
companies generally.
19.9 Negative pledge
(a) No Borrower shall, and the Company shall procure that no
other member of the Group will, create or permit to
subsist any Security Interest on any of its assets.
(b) Paragraph (a) does not apply to:
(i) any lien or right of set-off arising by operation of
law (or by an agreement having similar effect) in
the ordinary course of business; or
(ii) pledges of goods, the related documents of title
and/or other related documents arising or created in
the ordinary course of its business as security only
for Financial Indebtedness to a bank or financial
institution directly relating to the goods or
documents on or over which that pledge exists; or
(iii) any Security Interest arising out of title
retention or conditional sale provisions in a
supplier's standard conditions of supply of goods
acquired by any member of the Group in the ordinary
course of its business;
(iv) any Security Interest created under the Pooling and
Settlement Agreement;
(v) any Security Interest existing on an asset at the
time of the acquisition of the asset by any member
of the Group after the date of this Agreement, but
only if:
(A) the Security Interest was not created in
contemplation of the acquisition;
(B) the principal amount secured by the Security
Interest is not increased after the
acquisition; and
(C) the Security Interest is discharged within
180 days of the acquisition; or
(vi) any Security Interest existing on the assets of a
company at the time it becomes a member of the Group
after the date of this Agreement, but only if:
(A) the Security Interest was not created in
contemplation of the relevant company becoming
a member of the Group;
(B) the principal amount secured by the Security
Interest is not increased after the relevant
company becomes a member of the Group; and
(C) the Security Interest is discharged within
180 days of the relevant company becoming a
member of the Group; or
(vii) any Security Interest which:-
(A) constitutes a contractual right of any bank or
financial institution to apply any credit
balance maintained by any member of the Group
with that bank or financial institution against
any amount due and payable to such bank or
financial institution by that or any other
member of the Group; and
(B) arises in connection with the relevant Group
member's ordinary banking arrangements
(including a cash management scheme); or
(viii) any Security Interest created with the approval
of the Majority Banks; or
(ix) any Security Interest created by a Project Finance
Subsidiary, or over the shares of a Project Finance
Subsidiary, securing Project Finance Indebtedness;
or
(x) any other Security Interest not falling within any
of paragraphs (i) to (ix) above so long as the
aggregate principal amount of outstanding
indebtedness secured by all the Security Interests
permitted under this sub-paragraph (x) at any time,
together with the aggregate principal amount of all
outstanding indebtedness permitted under
Clause 19.10(b) (Transactions similar to security)
at that time, does not exceed (prior to the date on
which the Facility B Loans are repaid or prepaid in
full) 25,000,000 pounds or (subsequently)
50,000,000 pounds (or, in each case, its equivalent
in other currencies).
19.10 Transactions similar to security
(a) Subject to paragraph (b) below, no Borrower shall, and
the Company shall procure that no other member of the
Group will:-
(i) sell, transfer or otherwise dispose of any of its
assets on terms whereby it is or may be leased to or
re-acquired or acquired by a member of the Group or
any of its related entities; or
(ii) sell, transfer or otherwise dispose of any of its
receivables on recourse terms, except for the
discounting of bills or notes in the ordinary course
of trading,
in circumstances where the transaction is entered into
primarily as a method of raising finance or of financing
the acquisition of an asset.
(b) Any member of the Group may enter into transactions
otherwise prohibited by sub-paragraph (a)(i) above so
long as the aggregate principal amount of outstanding
indebtedness of the Group in respect of all such
transactions at any time, together with the aggregate
principal amount of all outstanding secured indebtedness
permitted under Clause 19.9(b)(x) (Negative pledge) at
that time, does not exceed (prior to the date on which
the Facility B Loans are repaid or prepaid in full)
25,000,000 pounds or (subsequently) 50,000,000 pounds (or,
in each case, its equivalent in other currencies).
19.11 Disposals
(a) The Company shall not sell, transfer or otherwise dispose
of or cease to exercise control over any of the Shares in
the Target acquired by it.
(b) No Borrower shall, and the Company shall procure that no
other member of the Group will, either in a single
transaction or in a series of transactions, whether
related or not and whether voluntarily or involuntarily,
sell, transfer, grant or lease or otherwise dispose of
all or any part of its assets (all such transactions
being "disposals" for the purpose of this Clause).
(c) Paragraph (b) does not apply to the following disposals
(if made on arm's length terms):-
(i) disposals made in the ordinary course of business of
the disposing entity; or
(ii) disposals of assets in exchange for other assets
comparable or superior as to type, value and
quality; or
(iii) disposals of obsolete or surplus assets no
longer required for the purpose of the relevant
person's business; or
(iv) the payment of cash as consideration for the
acquisition of any asset or services; or
(v) disposals by one member of the Group to another
member of the Group (other than a Project Finance
Subsidiary), but only if, in the case of a
Subsidiary of the Company to whom the assets are
transferred, the Company owns directly or indirectly
at least a corresponding percentage of the ownership
interest in the transferee Subsidiary as in the
transferor Subsidiary; or
(vi) other disposals of assets which are integral to the
distribution and supply of electricity activities of
the Group to the extent that the value of those
assets disposed of during any financial year of the
Company is less than 20,000,000 pounds (as determined
by reference to the audited consolidated balance sheet
of the Company as at the end of the relevant
financial year or, in the case of any such asset
which was not taken into account for the purposes of
that balance sheet, its book value at the date of
disposal); or
(vii) other disposals of assets not referred to in
paragraph (vi) above to the extent that the value of
those assets disposed of during any financial year
of the Company is less than 50,000,000 pounds (as
determined by reference to the audited consolidated
balance sheet of the Company as at the end of the
relevant financial year or, in the case of any such
asset which was not taken into account for the
purposes of that balance sheet, its book value at
the date of disposal); or
(viii) disposals of receivables on arm's length terms
up to a maximum value:
(1) of 20,000,000 pounds, at any time when the
Capitalisation Ratio is in excess of 65 per
cent.; or
(2) of 50,000,000 pounds at any time when the
Capitalisation Ratio is less than or equal to
65 per cent.; or
(3) in excess of the relevant limit of 20,000,000
pounds or 50,000,000 pound, as appropriate, but
only if the net proceeds of any such excess
disposals are applied in accordance with this
Agreement in or towards prepayment of the Facility
B Loans, with any excess being applied first
in or towards prepayment of the Facility A Loans
pro rata and secondly in or towards prepayment of
the Facility C Loans pro rata. The Total
Facility A Commitments, the Total Facility B
Commitments or the Total Facility C
Commitments, as the case may be, shall be
reduced by an amount equal to the relevant
prepayment; or
(ix) any other disposal approved by the Majority Banks.
19.12 Change of business
The Company shall procure that no substantial change is
made to the general nature or scope of the business of
the Company or the Group from that carried on at the date
of this Agreement or those which are usual for
electricity companies in the United Kingdom as at the
date of this Agreement, including, without limitation,
electricity distribution, supply and generation,
electrical contracting and business activities relating
to the gas, telecommunication and water industries.
19.13 Holding Company
The Company shall not carry on any business (other than
the holding of shares in, the making of loans to and the
provision of administrative services to members of the
Group) or acquire any assets other than cash, cash
equivalents or shares in (or loans to) members of the
Group.
19.14 Mergers and acquisitions
(a) No Borrower shall, and the Company shall procure that no
other member of the Group will, enter into any
amalgamation, demerger, merger or reconstruction, except
for any amalgamation, merger or reconstruction between a
member of the Group (other than a Borrower or the
Licenceholder) and any other member of the Group (other
than a Borrower or the Licenceholder).
(b) No Borrower shall, and the Company shall procure that no
other member of the Group will, acquire any assets or
business or make any investment if the assets, business
or investment is substantial in relation to the Group
(other than the Acquisition), except for:
(i) acquisitions or investments made in the ordinary
course of business;
(ii) acquisitions or investments which the Target or any
of its Subsidiaries is legally obliged to make at
the date the Target becomes a member of the Group;
(iii) capital expenditure and any other expenditure,
in either case required to be carried out under the
Licence, any Licence Undertaking or any other
applicable law or regulation; and
(iv) other acquisitions or investments, the consideration
for which does not exceed (on a cumulative basis)
from the Unconditional Acceptances Date:
(A) until the Facility B Loans are repaid or
prepaid in full, 10,000,000 pounds (or its equivalent
in other currencies); or
(B) at any other time, 20 per cent. of the Adjusted
Capital and Reserves at such time (or its
equivalent in other currencies),
but only if, in either case, no Default is then
outstanding or will result from the acquisition or
investment.
19.15 Distributions
(a) The Company shall not declare, recommend, make or pay any
dividend, distribution or payment (including by way of
redemption, repurchase, defeasance, retirement, return or
repayment) to any of its shareholders (other than any
payment due to its shareholders for goods and/or services
received or provided in the ordinary course of business)
or make any payment (including by way of redemption,
repurchase, defeasance, retirement, return or repayment
and including the payment of interest) in respect of any
Subordinated Debt, if:
(i) after the relevant dividend, payment or distribution
is made, the Company is not able to perform its
obligations under Clause 9.6 (Mandatory
prepayment/cancellation); or
(ii) a Default is outstanding or will result from the
relevant dividend, payment or distribution; or
(iii) the Capitalisation Ratio exceeds, or will as a
result of the relevant dividend, payment or
distribution exceed, 70 per cent.
(b) The Company shall procure that, with effect from the date
on which the Target becomes a Subsidiary of the Company
and on a quarterly basis, the Target either:
(i) pays dividends to its shareholders; or
(ii) provides funds by way of the making of a loan or the
payment of interest on a loan or the repayment of a
loan to the Company,
in each case in the maximum amount available to the
Target out of Surplus Cashflow. The Company's obligation
under paragraph (b) above does not extend to procuring
that the Target makes a payment or provides funds if it
would be contrary to any law or regulation or would
breach the Licence or any Licence Undertaking. Without
limiting the above, if the Target could make a payment or
provide funds by complying with Section 155 of the
Companies Act 1985 and the Target is able to do so, then
the Company shall procure that the Target takes the
necessary steps under Section 155-158 of the Companies
Act 1985 to enable the payment to be made or the relevant
funds to be provided.
19.16 Lending and borrowing
(a) The Company will procure that the aggregate Borrowings of
the Target and its Subsidiaries taken together on a
consolidated basis plus (to the extent not otherwise
included in Borrowings of the Target and/or its
Subsidiaries) the amount of any actual or contingent
liabilities of the Target and/or its Subsidiaries:
(i) for Borrowings at that time of any person in which
the Target or any of its Subsidiaries has an
ownership interest; or
(ii) to provide funds by loan, subscription for share
capital or otherwise to any person in which the
Target or any of its Subsidiaries has an ownership
interest,
will not exceed the aggregate of:
(A) the outstanding principal amount from time to time
of the Facility C Loans;
(B) the principal amount of all Borrowings of those
companies outstanding at the Unconditional
Acceptances Date save to the extent refinanced by a
Utilisation of Facility C;
(C) the outstanding principal amount from time to time
of all Borrowings of those companies for which the
only creditor is the Company;
(D) any Borrowing of the Target and/or its Subsidiaries
where there is recourse falling within paragraph
(b)(iii) of the definition of "Project Finance
Indebtedness" in Clause 1.1 (Definitions)
outstanding from time to time; and
(E) the amount which, when aggregated with the amounts
referred to in sub-paragraphs (A), (B) and (D)
above, equals 400,000,000 pounds.
(b) No Borrower will, and each Borrower will procure that no
member of the Group will, be the creditor in respect of
any Borrowings, other than:
(i) any Borrowing entered into with the prior consent of
the Majority Banks;
(ii) any Borrowing under paragraph (b) of the definition
of "Borrowings" where trade credit is extended by
any member of the Group on normal commercial terms
and in the ordinary course of its business on
substantially the same terms (or terms more
favourable to it) and in similar circumstances as
for trade credit extended prior to the date of this
Agreement by the Target or its Subsidiaries;
(iii) loans made by one member of the Group to
another member of the Group; or
(iv) Borrowings not otherwise permitted under to
paragraphs (i) to (iii) above in an aggregate amount
for the Group as a whole at any time outstanding not
exceeding 10,000,000 pounds.
(c) Without prejudice to paragraph (a) above and unless the
Majority Banks otherwise consent (such consent not to be
unreasonably withheld), the Company shall procure that
the Target does not repay or redeem the Bonds otherwise
than as may be required by the relevant bondholders in
accordance with the terms of the Bonds.
19.17 Hedging
(a) Subject to paragraph (b) below, no Borrower shall, and
the Company shall ensure that none of its Subsidiaries
will, enter into any interest rate swap, cap, ceiling,
collar or floor or any currency swap, futures, foreign
exchange or commodity contract or option (whether over
the counter or exchange traded) or any similar treasury
transaction, other than spot foreign exchange contracts
entered into in the ordinary course of business, and
transactions for the hedging of actual or projected
interest rate, currency and/or commodity and/or energy
price exposures arising in the ordinary course of the
business activities of that member of the Group.
(b) (i) It is the policy of the Company to ensure that
the interest rate on at least 50 per cent. of the
aggregate of the outstanding Facility A Loans and
the Facility C Loans is either fixed or subject to a
cap (the level of which must be acceptable to the
Arrangers (acting reasonably)), based on current
market rates at the time the relevant hedging
arrangement is put in place and for an average
period of not less than three years from the
Unconditional Acceptances Date.
(ii) The Company shall enter into such Swap Documents as
are necessary to implement the above policy within
three months of the Unconditional Acceptances Date.
19.18 Insurance
The Company shall, and (after the Clean-Up Date) shall
procure that each member of the Group will:
(a) maintain with underwriters or insurance companies of
repute the policies of insurance in relation to its
business and assets which a prudent person carrying
on a similar business might be expected to maintain
(including policies to cover public and third party
liability and insurance against business
interruption) and any such other insurance as may be
required pursuant to the terms of any Finance
Document; and
(b) from time to time upon request by the Agent, supply
the Agent with copies of all such insurance policies
or certificates of insurance or such other evidence
of the existence of such policies as may be
reasonably acceptable to the Agent.
19.19 Constitutional Documents
No Borrower will, and the Company will procure that no
other member of the Group will, without the prior consent
of the Majority Banks or as required by law, amend or
seek or agree to amend or replace the memorandum or
articles of association or other constitutional documents
or by-laws of any member of the Group in any way which
would be likely materially and adversely to affect the
interests of the Banks under the Finance Documents.
19.20 Arm's length terms
No Borrower will, and the Company will procure that no
other member of the Group will, enter into any material
transaction with any other person otherwise than on arm's
length terms, other than:
(a) transactions previously approved by the Majority
Banks;
(b) loans from or to, or disposals by, one member of the
Group to another which are permitted under the
Finance Documents;
(c) transactions entered into on terms more favourable
to a member of the Group than arm's length terms;
and
(d) other transactions (including the issue of
Subordinated Debt) expressly permitted under the
Finance Documents.
19.21 Share capital and security
The Company shall ensure that no member of the Group
whose shares are charged under the Debenture shall issue
any further shares or alter any rights attaching to its
issued shares in existence at the date of this Agreement
unless those further shares are contemporaneously
charged, by way of fixed charge, to the Agent on the
terms of the Debenture.
19.22 Security perfection
The Company shall take all action required to perfect the
Security Interests created by the Debenture over the
Security Assets (as defined in the Debenture) as soon as
reasonably practicable after the date of the Debenture,
including (without limitation) sending to the Agent in
form and substance satisfactory to it (acting
reasonably):
(a) unless already delivered to the Agent, all share
certificates and all other documents of title in
relation to shares, stocks or other securities
charged under the Debenture together with share
transfer forms executed in blank or other documents
required to enable the Agent or its nominees to
become registered as the owner of the same; and
(b) duly executed notices of charge and acknowledgements
in the form of the relevant schedules to the
Debenture respectively in relation to the relevant
agreements or accounts charged under the Debenture,
but the Company will only be obliged to use
reasonable endeavours to obtain the acknowledgements
referred to above.
19.23 Compliance with laws
Without prejudice to Clause 19.24 (Licences and
regulatory matters), each Borrower will, and the Company
will procure that each other member of the Group will,
comply in all material respects with all applicable laws
and regulations, whether domestic or foreign, having
jurisdiction over it or any of its assets, failure to
comply with which has a Material Adverse Effect.
19.24 Licences and regulatory matters
The Company shall:
(a) with effect from the Clean-Up Date, ensure that the
Target and any Licenceholder (or any other relevant
member of the Group) complies in all material
respects with the terms of its Licence where failure
to comply has a Material Adverse Effect; and
(b) notify the Agent promptly upon receipt by it or any
member of the Group of any notice from the
government, any court or any regulatory authority or
agency which is reasonably likely to give rise to
the revocation, termination, material adverse
amendment, suspension or withdrawal of any Licence
granted in its favour (unless, contemporaneously,
that Licence is to be replaced, substituted or
reissued on the same, substantially the same or
improved terms); and
(c) with effect from the Clean-Up Date, procure that
each other member of the Group will, comply with the
requirements of all rules, regulations, orders and
other requirements of the Secretary of State and the
Director General under the Act or any other law
applicable to the conduct of the business of the
supply or distribution of electricity, where failure
to comply has a Material Adverse Effect.
19.25 Licence Undertakings
The Company will consult with the Banks with regard to
the terms of any Licence Undertaking which it or any
Holding Company of it or the Target may be required to
give to the Director General or the Secretary of State in
connection with the Offer and will not give and will
procure that such Holding Company and (once it has become
a Subsidiary of the Company and under its control and in
any event no later than 30 days after the Target becomes
a Subsidiary of the Company) the Target will not give any
such Licence Undertaking without prior consultation with
the Banks.
19.26 Business Consents
Each Borrower will, and the Company will procure that
each other member of the Group will, obtain, promptly
renew from time to time, and maintain in full force and
effect, and if so requested promptly furnish certified
copies to the Agent of, all such material authorisations
as may be required under any applicable law or regulation
or under the Licence or any Licence Undertaking to carry
on its business as it is being conducted from time to
time, where failure to obtain, renew or maintain any such
authorisation or non-compliance with the terms of the
same has a Material Adverse Effect.
19.27 The Offer
The Company shall:
(a) issue the Press Release within 7 days of the date of
this Agreement;
(b) until the earlier of the date the Offer lapses or is
finally closed, comply in all material respects with
the Financial Services Act 1986 and the Companies
Act 1985 and all other applicable laws and
regulations relevant in the context of the Offer,
including (subject to any waivers by the Panel) the
Code;
(c) provide each of the Arrangers with such information
regarding the progress of the Offer as it may
reasonably request;
(d) unless required to do so by law or under the Code
(and if so required, having notified the Agent as
soon as possible after becoming aware of the
requirement) not issue any press release or make any
statement during the course of the Offer which
contains any information or statement concerning the
Finance Documents or the Finance Parties without
first obtaining the prior approval of the
information or statement from the Arrangers, in each
case such approval not to be unreasonably withheld
or delayed;
(e) not purchase any Shares if to do so would mean that
it must make a mandatory offer under Rule 9 of the
Code;
(f) promptly give notices under Section 429 of the
Companies Act 1985 in respect of the Shares upon the
conditions contained in the Companies Act 1985 for
the giving of those notices being satisfied; and
(g) ensure that no amendment is made or waiver given in
respect of any condition of the Offer which, if not
waived, would entitle the Company to lapse the
Offer, unless the Majority Banks have given their
prior consent (such consent not to be unreasonably
withheld or delayed); however, any such amendment or
waiver must relate to:-
(i) any increase in the purchase price for the
Shares above the level agreed between the
Company and the Banks from time to time; or
(ii) the provisions relating to a material adverse
change affecting the Target.
19.28 Financial covenants
(a) In this Clause 19.28:-
"Adjusted Capital and Reserves"
means the amount (including any share premium) for the
time being paid up or credited as paid up on the issued
share capital of the Company, adjusted as follows:
(i) plus the outstanding amount of any Subordinated
Debt;
(ii) plus the amount standing to the credit (or, as the
case may be, minus the amount standing to the debit)
of the capital and revenue reserves of the Group;
(iii) plus any amount standing to the credit or minus any
amount standing to the debit of the consolidated
profit and loss account of the Group;
(iv) minus any distribution declared or made by the
Company or any of its Subsidiaries (other than to
another member of the Group) out of profits included
within reserves to the extent that those reserves
have not already been reduced on account of it;
(v) minus amounts attributable to the interests (if any)
of outside holders of issued share capital in any
member of the Group other than the Company itself;
and, for the purposes of the foregoing;
(A) no item shall be effectively deducted or added more
than once, all items shall be calculated on a
consolidated basis and (subject only as may be
required in order to reflect the express inclusion
or exclusion of items as specified in this
definition) in accordance with the Applicable
Accounting Principles; and
(B) where the calculation is being made as at the end of
any Accounting Period it shall be determined from
the balance sheet forming part of the relevant
quarterly or annual accounts for that Accounting
Period and, where the calculation is being made on
the Business Day following a Subsequent Capital
Injection for the purposes of paragraph (a) of the
definition of "Margin Adjustment Date", it shall be
determined from a certificate of two senior
authorised officers of the Company delivered to the
Agent following that Subsequent Capital Injection.
"Capitalisation Ratio"
means, at any time, the ratio of Consolidated Net Total
Borrowings to the aggregate of Consolidated Net Total
Borrowings and Adjusted Capital and Reserves, expressed
as a percentage.
"Consolidated EBITDA"
for any period comprising an annual Accounting Period of
the Company or consecutive quarterly Accounting Periods
of the Company (taken together as one period) means the
profit of the Group for such period:
(i) before deducting all depreciation and other
amortisation (including, without limitation,
amortisation of goodwill arising from and upon the
acquisition of the Shares and amortisation of Offer
Costs in accordance with Financial Reporting
Standard 4 issued by the Accounting Standards
Board);
(ii) before taking into account all Extraordinary Items
(whether positive or negative) but after taking into
account all Exceptional Items (whether positive or
negative);
(iii) before deducting tax;
(iv) before taking into account Consolidated Net Interest
Payable for such period;
(v) before deducting any Offer Costs; and
(vi) after deducting any gain, or adding any loss, to
book value arising in favour of the Group on the
sale, lease or other disposal of any asset (other
than on the sale of trading stock) during such
period and deducting any gain, or adding any loss,
arising on revaluation of any asset during such
period, in each case to the extent that it would
otherwise be taken into account, whether as an
Exceptional Item or otherwise,
and, for the purposes of the foregoing, no item shall be
effectively deducted or credited more than once in this
calculation, all items shall be determined on a
consolidated basis and (subject only as may be required
in order to reflect the express inclusion or exclusion of
items as specified in this definition) in accordance with
the Applicable Accounting Principles and as determined
from the consolidated accounts of the Group for that
annual Accounting Period or for the relevant Accounting
Periods falling within that period.
"Consolidated Net Interest Payable"
means Consolidated Total Interest Payable less any
interest or amounts in the nature of interest receivable
during the relevant annual Accounting Period of the
Company or consecutive quarterly Accounting Periods of
the Company (taken together as one period), determined on
the same basis and manner as for Consolidated Total
Interest Payable.
"Consolidated Net Total Borrowings"
at any time means the aggregate at that time of the
Borrowings of the members of the Group from sources
external to the Group,
(i) plus (to the extent not otherwise included) the
amount of any actual or contingent liability of any
member of the Group:
(A) for Borrowings at that time of any person in
which any member of the Group has an ownership
interest; or
(B) to provide funds by loan, subscription for
share capital or otherwise to any person in
which any member of the Group has an ownership
interest;
(ii) less the cash in hand and cash equivalents of the
members of the Group at that time,
calculated on a consolidated basis and (subject only as
may be required in order to reflect the express inclusion
or exclusion of items as specified herein and/or in the
definition of Borrowings in this Clause) in accordance
with the Applicable Accounting Principles and, (1) where
the calculation is being made as at the end of any
Accounting Period for which a consolidated balance sheet
of the Group has been delivered to the Agent, as shown in
that balance sheet; and (2) where the calculation is
being made on any other day following a Subsequent
Capital Injection for the purposes of paragraph (a) of
the definition of "Margin Adjustment Date", it shall be
determined from a certificate of two senior authorised
officers of the Company delivered to the Agent following
that Subsequent Capital Injection.
"Consolidated Total Interest Payable"
for any period comprising an annual Accounting Period of
the Company or consecutive quarterly Accounting Periods
of the Company (taken together as one period) means the
interest (and all amounts required by the Applicable
Accounting Principles to be accounted for as interest)
accrued on Borrowings of the Group during such period as
an obligation of any member or members of the Group
(whether or not paid or capitalised during or deferred
for payment after such period) adjusted to take account
of any amount constituting interest receivable by any
members of the Group under interest rate and/or currency
hedging agreements or instruments under which all parties
are in compliance with their payment and other material
obligations, all determined on a consolidated basis and
(subject only as may be required in order to reflect the
express inclusion or exclusion of items as specified in
this definition) in accordance with the Applicable
Accounting Principles and as shown in the consolidated
accounts of the Group for such annual Accounting Period
or for the Accounting Periods falling within such period.
"Exceptional Items"
has the meaning given to it in Financial Reporting
Standard 3 issued by the Accounting Standards Board (as
in force at the date of this Agreement), but shall
exclude any items falling within the definition of
Extraordinary Items.
"Extraordinary Items"
has the meaning given to it in Financial Reporting
Standard 3 issued by the Accounting Standards Board (as
in force at the date of this Agreement) but in addition
shall include those items listed in paragraph 20 thereof.
(b) (i) All the terms used in paragraph (a) above are
to be calculated in accordance with the Applicable
Accounting Principles.
(ii) If there is a dispute as to any interpretation of or
computation for paragraph (a) above, the
interpretation or computation of the Auditors
prevails.
(c) The Company shall procure that:-
(i) as of each date on which it is tested under
paragraph (d) below, the ratio of Consolidated
EBITDA to Consolidated Net Interest Payable is no
less than:
(A) for the period from the date on which the
Target becomes a Subsidiary of the Company
until the date on which the Facility B Loans
are repaid or prepaid in full, 1.75:1; and
(B) thereafter, 2.0:1; and
(ii) the Capitalisation Ratio shall not, as of each date
on which it is tested under paragraph (e) below,
exceed:
(A) for the period from the date on which the
Target becomes a Subsidiary of the Company
until the date on which the Facility B Loans
are repaid or prepaid in full, 90 per cent.;
(B) for the period from the date on which the
Facility B Loans are repaid or prepaid in full
until the date falling three years after the
date of this Agreement, 75 per cent.; and
(C) thereafter, 65 per cent.
(d) (i) The first test of the covenant set out in
paragraph (c)(i) above shall be made in respect of
the period beginning on the date the Target becomes
a member of the Group and ending on its First Test
Date;
(ii) the next three tests of the covenant set out in
paragraph (c)(i) above shall be made on a cumulative
basis as of the expiry of each subsequent quarterly
Accounting Period; and
(iii)each test of the covenant set out in
paragraph (c)(i) above thereafter shall be made on a
quarterly basis and in respect of the annual
Accounting Period ending on the expiry of the
relevant quarterly Accounting Period.
(e) The tests of the covenant set out in paragraph (c)(ii)
above shall be made as of:
(i) its First Test Date;
(ii) the date of any Subsequent Capital Injection; and
(iii) the last day of each quarterly Accounting Period
after its First Test Date.
20. DEFAULT
20.1 Events of Default
Each of the events set out in Clauses 20.2 (Non-payment)
to 20.20 (Material adverse change) (inclusive) is an
Event of Default (whether or not caused by any reason
whatsoever outside the control of any Borrower or any
other person).
20.2 Non-payment
A Borrower does not pay on the due date any amount
payable by it under the Finance Documents at the place at
and in the currency in which it is expressed to be
payable and (if caused by technical or administrative
error) the non-payment continues unremedied for
3 Business Days from the receipt by it of notice of non-
payment from the Agent.
20.3 Breach of other obligations
(a) The Company fails to comply with any provision of Clauses
19.8 (Pari passu ranking) to 19.15 (Distributions)
inclusive, Clause 19.20 (Arm's length terms) and
Clause 19.28(c)(i) (Financial covenants);
(b) the Company fails to comply with Clause 19.28(c)(ii)
(Financial covenants) and, if that default is capable of
remedy, it is not remedied within 3 Business Days of the
default; or
(c) a Borrower does not comply with any provision of the
Finance Documents (other than those referred to in
Clause 20.2 (Non-payment) or paragraph (a) or (b) above)
and, if that default is capable of remedy, it is not
remedied within 28 days of the earlier of the relevant
Borrower becoming aware of the default and receipt by it
of a notice of default from the Agent.
20.4 Misrepresentation
A representation, warranty or statement made or repeated
in or in connection with any Finance Document or in any
document delivered by or on behalf of any Borrower under
or in connection with any Finance Document is incorrect
in any material respect when made or deemed to be made or
repeated by reference to the facts and circumstances then
subsisting and, if the circumstances causing the
misrepresentation are capable of remedy within that
period, that misrepresentation is not remedied within 28
days of the earlier of the relevant Borrower becoming
aware of the misrepresentation and receipt by it of
notice from the Agent requiring remedy.
20.5 Cross-default
(a) Any Financial Indebtedness of a member of the Group is
not paid when due or within any applicable grace period;
or
(b) an event of default howsoever described occurs under any
document relating to Financial Indebtedness of a member
of the Group; or
(c) any Financial Indebtedness of a member of the Group
becomes prematurely due and payable or is placed on
demand as a result of an event of default (howsoever
described) under the document relating to that Financial
Indebtedness; or
(d) any commitment for, or underwriting of, any Financial
Indebtedness of a member of the Group is cancelled or
suspended as a result of an event of default (howsoever
described) under the document relating to that Financial
Indebtedness; or
(e) any Security Interest securing Financial Indebtedness
over any asset of a member of the Group becomes
enforceable,
unless, in any such case or cases:-
(i) the aggregate amount of Financial Indebtedness is
less than 20,000,000 pounds (or its equivalent in other
currencies) and for this purpose, the amount of any
Financial Indebtedness specified in paragraph (b)
above will be determined after making the
adjustments specified in paragraphs (b) and (c) of
the definition of "Borrowings" contained in
Clause 1.1 (Definitions); or
(ii) the Financial Indebtedness is that of the Target or
a Subsidiary of the Target, the relevant event
occurs prior to the Clean-Up Date and the Financial
Indebtedness is to be refinanced by a Loan prior to
the Clean-Up Date.
20.6 Insolvency
(a) A Borrower or a Material Subsidiary is, or is deemed for
the purposes of any law to be, unable to pay its debts as
they fall due or to be insolvent, or admits inability to
pay its debts as they fall due; or
(b) a Borrower or a Material Subsidiary suspends making
payments on all or any class of its debts or announces an
intention to do so, or a moratorium is declared in
respect of all or any class of its indebtedness; or
(c) a Borrower or a Material Subsidiary by reason of
financial difficulties, begins negotiations with one or
more of its creditors with a view to the readjustment or
rescheduling of all or any class of its indebtedness.
20.7 Insolvency proceedings
(a) Any step (including petition, proposal or convening a
meeting) is taken with a view to a composition,
assignment or arrangement with any creditors of a
Borrower or a Material Subsidiary; or
(b) a meeting of a Borrower or a Material Subsidiary is
convened for the purpose of considering any resolution
for (or to petition for) its winding-up or its
administration or any such resolution is passed; or
(c) any person presents a petition for the winding-up or for
the administration of a Borrower or a Material
Subsidiary, and, in the case of a petition for winding-up
presented by a creditor, it is not withdrawn, discharged
or stayed within 21 days; or
(d) any order is made for the winding-up or administration of
a Borrower or a Material Subsidiary; or
(e) any other step (including petition, proposal or convening
a meeting) is taken with a view to the rehabilitation,
administration, custodianship, liquidation, winding-up or
dissolution of any Borrower or a Material Subsidiary or
any other insolvency proceedings involving Borrower or a
Material Subsidiary, and, in the case of any such step
taken by a creditor, it is not withdrawn, discharged or
stayed within 21 days,
except for any which arises from a Permitted Transaction.
20.8 Appointment of receivers and managers
(a) Any liquidator, trustee in bankruptcy, judicial
custodian, compulsory manager, receiver, administrative
receiver, administrator or the like is appointed in
respect of a Borrower or a Material Subsidiary or any
part of its assets, otherwise than in connection with a
Permitted Transaction; or
(b) the directors of a Borrower or a Material Subsidiary
requests the appointment of a liquidator, trustee in
bankruptcy, judicial custodian, compulsory manager,
receiver, administrative receiver, administrator or the
like, otherwise than in connection with a Permitted
Transaction; or
(c) any other step is taken to enforce any Security Interest
over any part of the assets of a Borrower or a Material
Subsidiary and is not withdrawn, discharged or stayed
within 21 days.
20.9 Creditors' process
Any attachment, sequestration, distress or execution
affects any assets of a Borrower or a Material Subsidiary
having an aggregate value of 20,000,000 pounds (or its
equivalent in other currencies) and is not discharged
within 14 days, unless:
(a) it is being contested in good faith with due
diligence; and
(b) in the reasonable opinion of the Majority Banks, it
does not have a Material Adverse Effect.
20.10 Analogous proceedings
There occurs, in relation to a Borrower or Material
Subsidiary, any event anywhere which, in the opinion of
the Majority Banks, appears to correspond with any of
those mentioned in Clauses 20.6 (Insolvency) to 20.9
(Creditors' process) (inclusive).
20.11 Cessation of business
A Borrower or a Material Subsidiary ceases, or threatens
to cease, to carry on all or a substantial part of its
business, other than in connection with a Permitted
Transaction.
20.12 Unlawfulness
It is or becomes unlawful for any Borrower to perform any
of its material obligations under the Finance Documents.
20.13 Ownership of the Target
At any time after the Clean-Up Date, less than 75 per
cent. of the issued share capital of the Target is
beneficially owned by the Company.
20.14 Ownership of the Company
(a) The Parent transfers any of the shares legally and
beneficially owned by it to an entity other than:
(i) to Entergy Corporation or any of its Subsidiaries;
or
(ii) to an entity, which has (or has an Affiliate which
has) a credit rating of at least BBB- with Standard
& Poor's rating group or a comparable rating with
any other rating agency.
(b) The issued share capital of the Company ceases to be
legally and beneficially owned as to at least 50 per
cent. by Entergy Corporation and/or any of its
Subsidiaries.
(c) The issued share capital of the Company at any time is
owned by more than three persons and, for this purpose,
"person" includes any group of persons which are
Affiliates.
20.15 Licence
(a) The Licence is revoked or surrendered or ceases to be
held by the Target or a wholly-owned Subsidiary of the
Target or the Company, other than in circumstances which
permit the Target or one of its wholly-owned Subsidiaries
to carry on the distribution business of the Target
substantially as envisaged at the date of this Agreement
either without the Licence as a result of any change in
the Act or with a new public electricity supply licence
issued to such person under the Act whose terms are not
materially less favourable than those of the Licence; or
(b) the Licence or any substitute licence contemplated by
paragraph (b) above is materially modified in any manner
which, in the reasonable opinion of the Majority Banks,
has (whether immediately or in the course of time) a
Material Adverse Effect.
20.16 Compliance with the Act
The Licenceholder fails to comply with:
(a) a final order (within the meaning of Section 25 of
the Act); or
(b) a provisional order (within the meaning of that
section) which has been confirmed under that
section,
and, in either case, the order has not been revoked under
that section or the validity of the order has not been
questioned under Section 27 of the Act.
20.17 Pooling and Settlement Agreement
(a) Any notice requiring the Target to cease to be a party to
the Pooling and Settlement Agreement is given to the
Target under the Pooling and Settlement Agreement.
(b) The Target ceases to be a party to the Pooling and
Settlement Agreement.
20.18 Expropriation
The authority or ability of the Company or the Target or
the Licenceholder to conduct its business is wholly or
substantially curtailed by any expropriation or
renationalisation by or on behalf of any governmental
authority.
20.19 Security
The Debenture or the guarantee of the Company or any
Subordination Agreement is ineffective or is alleged by a
Borrower or (in the case of a Subordination Agreement)
the relevant junior creditor to be ineffective for any
reason.
20.20 Material adverse change
Any event or series of events occurs which, in the
reasonable opinion of the Majority Banks, has or is
reasonably likely to have a material adverse effect on
the ability of a Borrower to comply with:
(a) its payment obligations under any Finance Document;
or
(b) its obligations under Clause 19.28 (Financial
covenants).
20.21 Acceleration
On and at any time after the occurrence of an Event of
Default the Agent may, and shall if so directed by the
Majority Banks, by notice to the Company:-
(a) cancel the Total Commitments; and/or
(b) demand that all or part of the Loans, together with
accrued interest, and all other amounts accrued
under this Agreement be immediately due and payable,
whereupon they shall become immediately due and
payable; and/or
(c) demand that all or part of the Loans be payable on
demand, whereupon they shall immediately become
payable on demand by the Agent (acting on the
instructions of the Majority Banks); and/or
(d) demand immediate full cash cover in respect of the
Guarantee whereupon the Company shall immediately
provide to the Agent by way of payment into a
Security Account cash cover in an amount equal to
the Banks' maximum aggregate actual and contingent
liability under the Guarantee.
20.22 Limited rights of rescission
Prior to the end of the Certain Funds Period, no Bank has
or may seek to exercise any right of rescission or other
remedy (including under Clauses 4.2 (Further conditions
precedent) and 20.21 (Acceleration)) in consequence of:
(a) any of the representations or warranties of any
Borrower in the Finance Documents (other than those
made by the Company in respect of itself and
contained in Clauses 18.2(a) (Status), 18.3 (Powers
and authority), 18.4 (Legal validity) and 18.5 (Non-
conflict)) being or being proved to have been
incorrect in any respect; or
(b) the occurrence of a Default other than a Major
Default.
21. THE AGENT AND THE ARRANGERS
21.1 Appointment and duties of the Agent
(a) Each Finance Party (other than the Agent) irrevocably
appoints the Agent to act as its agent under and in
connection with the Finance Documents, and irrevocably
authorises the Agent on its behalf to perform the duties
and to exercise the rights, powers and discretions that
are specifically delegated to it under or in connection
with the Finance Documents, together with any other
incidental rights, powers and discretions. The Agent
shall have only those duties which are expressly
specified in this Agreement. Those duties are solely of a
mechanical and administrative nature.
(b) The Agent agrees to execute a Subordination Agreement,
duly executed by the Company and the relevant junior
creditor, promptly on request by the Company.
21.2 Role of the Arrangers
Except as otherwise provided in this Agreement, no
Arranger has any obligations of any kind to any other
Party under or in connection with any Finance Document.
21.3 Relationship
The relationship between the Agent and the other Finance
Parties is that of agent and principal only. Nothing in
this Agreement constitutes the Agent as trustee or
fiduciary for any other Party or any other person and the
Agent need not hold in trust any moneys paid to it for a
Party or be liable to account for interest on those
moneys.
21.4 Majority Banks' directions
The Agent will be fully protected if it acts in
accordance with the instructions of the Majority Banks in
connection with the exercise of any right, power or
discretion or any matter not expressly provided for in
the Finance Documents. Any such instructions given by the
Majority Banks will be binding on all the Banks. In the
absence of such instructions the Agent may act as it
considers to be in the best interests of all the Banks.
21.5 Delegation
The Agent may act under the Finance Documents through its
personnel and agents.
21.6 Responsibility for documentation
None of the Agent and the Arrangers is responsible to any
other Party for:-
(a) the execution, genuineness, validity, enforceability
or sufficiency of any Finance Document or any other
document;
(b) the collectability of amounts payable under any
Finance Document; or
(c) the accuracy of any statements (whether written or
oral) made in or in connection with any Finance
Document (including the Information Memorandum).
21.7 Default
(a) The Agent is not obliged to monitor or enquire as to
whether or not a Default has occurred. The Agent will not
be deemed to have knowledge of the occurrence of a
Default. However, if the Agent receives notice from a
Party referring to this Agreement, describing the Default
and stating that the event is a Default, it shall
promptly notify the Banks.
(b) The Agent may require from the Banks the receipt of
security satisfactory to it whether by way of payment in
advance or otherwise, against any liability or loss which
it will or may incur in taking any proceedings or action
arising out of or in connection with any Finance Document
before it commences those proceedings or takes that
action.
21.8 Exoneration
(a) Without limiting paragraph (b) below, the Agent will not
be liable to any other Party for any action taken or not
taken by it under or in connection with any Finance
Document, unless directly caused by its gross negligence
or wilful misconduct.
(b) No Party may take any proceedings against any officer,
employee or agent of the Agent in respect of any claim it
might have against the Agent or in respect of any act or
omission of any kind (including negligence or wilful
misconduct) by that officer, employee or agent in
relation to any Finance Document.
21.9 Reliance
The Agent may:-
(a) rely on any notice or document believed by it to be
genuine and correct and to have been signed by, or
with the authority of, the proper person;
(b) rely on any statement made by a director or employee
of any person regarding any matters which may
reasonably be assumed to be within his knowledge or
within his power to verify; and
(c) engage, pay for and rely on legal or other
professional advisers selected by it (including
those in the Agent's employment and those
representing a Party other than the Agent).
21.10 Credit approval and appraisal
Without affecting the responsibility of any Borrower for
information supplied by it or on its behalf in connection
with any Finance Document, each Bank confirms that it:-
(a) has made its own independent investigation and
assessment of the financial condition and affairs of
each Borrower and its related entities in connection
with its participation in this Agreement and has not
relied exclusively on any information provided to it
by the Agent or an Arranger in connection with any
Finance Document; and
(b) will continue to make its own independent appraisal
of the creditworthiness of each Borrower and its
related entities while any amount is or may be
outstanding under the Finance Documents or any
Commitment is in force.
21.11 Information
(a) The Agent shall promptly forward to the person concerned
the original or a copy of any document which is delivered
to the Agent by a Party for that person.
(b) The Agent shall promptly supply a Bank with a copy of
each document received by the Agent under Clause 4
(Conditions precedent) or 28.4 (Target as Borrower) upon
the request and at the expense of that Bank.
(c) Except where this Agreement specifically provides
otherwise, the Agent is not obliged to review or check
the accuracy or completeness of any document it forwards
to another Party.
(d) Except as provided above, the Agent has no duty:-
(i) either initially or on a continuing basis to provide
any Bank with any credit or other information
concerning the financial condition or affairs of any
Borrower or any related entity of any Borrower
whether coming into its possession or that of any of
its related entities before, on or after the date of
this Agreement; or
(ii) unless specifically requested to do so by a Bank in
accordance with this Agreement, to request any
certificates or other documents from any Borrower.
21.12 The Agent and the Arrangers individually
(a) If it is also a Bank, each of the Agent and the Arrangers
has the same rights and powers under the Finance
Documents as any other Bank and may exercise those rights
and powers as though it were not the Agent or an
Arranger.
(b) Each of the Agent and the Arrangers may:-
(i) carry on any business with a Borrower or its related
entities;
(ii) act as agent or trustee for, or in relation to any
financing involving, a Borrower or its related
entities; and
(iii) retain any profits or remuneration in connection
with its activities under this Agreement or in
relation to any of the foregoing.
(c) In acting as Agent for the Banks, the Agent's agency
division shall be treated as a separate entity from any
other of its divisions or departments and,
notwithstanding the foregoing provisions of this
Clause 21, if the Agent should act for any member of the
Group in any capacity in relation to any other matter,
any information given by that member of the Group to the
Agent in such other capacity may be treated as
confidential by the Agent.
21.13 Indemnities
(a) Without limiting the liability of any Borrower under the
Finance Documents, each Bank shall forthwith on demand
indemnify the Agent for its proportion of any liability
or loss incurred by the Agent in any way relating to or
arising out of its acting as the Agent, except to the
extent that the liability or loss arises directly from
the Agent's gross negligence or wilful misconduct.
(b) A Bank's proportion of the liability or loss set out in
paragraph (a) above is the proportion which its
participation in the Utilisations (if any) bear to all
the Utilisations on the date of the demand. If, however,
there are no Utilisations outstanding on the date of
demand, then the proportion will be the proportion which
its Commitments bears to the Total Commitments at the
date of demand or, if the Total Commitments have been
cancelled, bore to the Total Commitments immediately
before being cancelled.
21.14 Compliance
(a) The Agent may refrain from doing anything which might, in
its opinion, constitute a breach of any law or regulation
or be otherwise actionable at the suit of any person, and
may do anything which, in its opinion, is necessary or
desirable to comply with any law or regulation of any
jurisdiction.
(b) Without limiting paragraph (a) above, the Agent need not
disclose any information relating to any Borrower or any
of its related entities if the disclosure might, in the
opinion of the Agent, constitute a breach of any law or
regulation or any duty of secrecy or confidentiality or
be otherwise actionable at the suit of any person.
21.15 Resignation of Agent
(a) Notwithstanding its irrevocable appointment, the Agent
may resign by giving notice to the Banks and the Company,
in which case the Agent may forthwith appoint one of its
Affiliates as successor Agent or, failing that, the
Majority Banks may (after consultation with the Company)
appoint a successor Agent.
(b) If the appointment of a successor Agent is to be made by
the Majority Banks but they have not, within 30 days
after notice of resignation, appointed a successor Agent
which accepts the appointment, the retiring Agent may
appoint a successor Agent.
(c) The resignation of the retiring Agent and the appointment
of any successor Agent will both become effective only
upon the successor Agent notifying all the Parties that
it accepts the appointment. On giving the notification,
the successor Agent will succeed to the position of the
retiring Agent and the term "Agent" will mean the
successor Agent.
(d) The retiring Agent shall, at its own cost, make available
to the successor Agent such documents and records and
provide such assistance as the successor Agent may
reasonably request for the purposes of performing its
functions as the Agent under this Agreement.
(e) Upon its resignation becoming effective, this Clause 21
(The Agent and the Arrangers) shall continue to benefit
the retiring Agent in respect of any action taken or not
taken by it under or in connection with the Finance
Documents while it was the Agent, and, subject to
paragraph (d) above, it shall have no further obligation
under any Finance Document.
(f) If so instructed by the Majority Banks, the Agent shall
resign in accordance with paragraph (a) above. However,
in this event the Agent may not appoint a successor
Agent.
21.16 Banks
The Agent may treat each Bank as a Bank, entitled to
payments under this Agreement and as acting through its
Facility Office(s) until it has received notice from the
Bank to the contrary not less than 5 Business Days prior
to the relevant payment.
21.17 Agent as Trustee
(a) The Agent in its capacity as trustee or otherwise under
the Debenture:-
(i) is not liable for any failure, omission or defect in
perfecting or registering the security constituted
or created by any Finance Document;
(ii) may accept without enquiry such title as the Company
may have to any asset secured by the Debenture; and
(iii) is not under any obligation to hold any Finance
Document or any other document in connection with
the Finance Documents or the assets secured by any
Finance Document (including title deeds) in its own
possession or to take any steps to protect or
preserve the same. The Agent may permit any member
of the Group to retain any Finance Document or other
document in its possession.
(b) Save as otherwise provided in the Finance Documents, all
moneys which under the trusts contained in the Finance
Documents are received by the Agent in its capacity as
trustee or otherwise may be invested in the name of or
under the control of the Agent in any investment
authorised by English law for the investment by trustees
of trust money or in any other investments which may be
selected by the Agent. Additionally, the same may be
placed on deposit in the name of or under the control of
the Agent at such bank or institution (including the
Agent) and upon such terms as the Agent may think fit.
22. FEES
22.1 Front-end fee
The Company shall pay (or procure the payment) to the
Agent for the Arrangers a front-end fee in the amounts
and on the dates agreed in the Fee Letter between the
Company and the Arrangers.
22.2 Commitment fee
(a) The Company shall pay to the Agent for each Bank a
commitment fee computed at the rate of:
(i) (A) during the period from the date of this
Agreement up to (but excluding) the
Unconditional Acceptances Date, 0.15 per cent.
per annum; and
(B) subsequently up to (and including) the
Facility A Final Repayment Date, 50 per cent.
of the applicable Margin,
on the undrawn, uncancelled amount of that Bank's
Facility A Commitment; any change to the commitment
fee under this sub-paragraph takes effect from the
Business Day following receipt of the relevant
compliance certificate providing for a change to the
applicable Margin, even though the applicable Margin
may only apply to Facility A Loans made after that
date, or, in any other case, the relevant Margin
Adjustment Date;
(ii) during the period from the date of this Agreement up
to (and including) the Facility B Term Date, 50 per
cent. of the applicable Margin on the undrawn,
uncancelled amount of that Bank's Facility B
Commitment; and
(iii) (A) during the period from the date of this
Agreement up to (but excluding) the
Unconditional Acceptances Date, 0.15 per cent.
per annum; and
(B) subsequently up to (and including) the
Facility C Final Repayment Date, 50 per cent.
of the applicable Margin,
on the undrawn, uncancelled amount of that Bank's
Facility C Commitment.
(b) Accrued commitment fee is payable quarterly in arrear.
Accrued commitment fee is also payable to the Agent for
the relevant Bank(s) on the cancelled amount of its
Commitment at the time the cancellation takes effect.
22.3 Guarantee fee
(a) The Company shall pay to the Agent for the Banks a
guarantee fee computed at the rate equivalent to the
Margin applicable to Facility A Loans on the Guarantee
Outstandings from the Issue Date of the Guarantee up to
and including the Expiry Date. Any change to the
guarantee fee takes effect from the next date an
instalment of guarantee fee is payable which falls after
the Business Day following receipt of the relevant
compliance certificate providing for a change to the
applicable Margin.
(b) Guarantee fee is payable quarterly in advance from the
Issue Date of the Guarantee, and on the Expiry Date of
the Guarantee.
22.4 Agent's fee
The Company shall pay (or procure the payment) to the
Agent for its own account an agency fee in the amount
agreed in the Fee Letter between the Company and the
Agent. The agency fee is payable annually in advance.
The first payment of this fee is payable on the date of
this Agreement and each subsequent payment is payable on
each anniversary of the date of this Agreement for so
long as any amount is or may be outstanding under this
Agreement or any Commitment is in force.
22.5 Issuing Bank's fee
The Company shall pay to the Issuing Bank for its own
account a fronting fee in the amount and on the dates
agreed in the Fee Letter between the Company and the
Agent.
22.6 VAT
Any fee referred to in this Clause 22 (Fees) is exclusive
of any value added tax or any other tax which might be
chargeable in connection with that fee. If any value
added tax or other tax is so chargeable, it shall be paid
by the Company at the same time as it pays the relevant
fee.
23. EXPENSES
23.1 Initial and special costs
The Company shall forthwith on demand pay (or procure the
payment) to the Agent and the Arrangers the amount of all
reasonable costs and expenses (including legal fees)
reasonably incurred by them in connection with:-
(a) Syndication and the negotiation, preparation,
printing and execution of this Agreement and any
other documents referred to in this Agreement but,
subject to the maximum limit agreed in respect of
legal fees in the Fee Letter referred to in
Clause 22.1 (Front-end fee);
(b) the negotiation, preparation, printing and execution
of any other Finance Document (other than a Novation
Certificate or the Syndication Agreement) executed
after the date of this Agreement; and
(c) any amendment, waiver, consent or suspension of
rights (or any proposal for any of the foregoing)
requested by or on behalf of a Borrower or, in the
case of Clause 2.3 (Change of currency), the Agent
and relating to a Finance Document or a document
referred to in any Finance Document.
23.2 Enforcement costs
The Company shall forthwith on demand pay to each Finance
Party the amount of all reasonable costs and expenses
(including, without limitation, legal fees) incurred by
it in connection with the enforcement of, or the
preservation of any rights under, any Finance Document.
24. STAMP DUTIES
The Company shall pay and forthwith on demand indemnify
each Finance Party against any liability it incurs in
respect of any stamp, registration and similar tax which
is or becomes payable in connection with the entry into,
performance or enforcement of any Finance Document.
25. INDEMNITIES
25.1 Currency indemnity
(a) If a Finance Party receives an amount in respect of a
Borrower's liability under the Finance Documents or if
that liability is converted into a claim, proof,
judgement or order in a currency other than the currency
(the "contractual currency") in which the amount is
expressed to be payable under the relevant Finance
Document:-
(i) that Borrower shall indemnify that Finance Party as
an independent obligation against any loss or
liability arising out of or as a result of the
conversion;
(ii) if the amount received by that Finance Party, when
converted into the contractual currency at a market
rate in the usual course of its business, is less
than the amount owed in the contractual currency,
the Borrower concerned shall forthwith on demand pay
to that Finance Party an amount in the contractual
currency equal to the deficit; and
(iii) the Borrower shall pay to the Finance Party
concerned on demand any exchange costs and taxes
payable in connection with any such conversion.
(b) Each Borrower waives any right it may have in any
jurisdiction to pay any amount under the Finance
Documents in a currency other than that in which it is
expressed to be payable.
25.2 Other indemnities
The Company shall forthwith on demand indemnify each
Finance Party against any loss or liability which that
Finance Party incurs as a consequence of:-
(a) the occurrence of any Default;
(b) a change in currency of a country or the operation
of Clause 2.3 (Change of currency), the operation of
Clause 20.21 (Acceleration) or Clause 31 (Pro rata
sharing);
(c) any payment of principal or an overdue amount being
received from any source otherwise than on its due
date and, for the purposes of this paragraph (c),
the Repayment Date of an overdue amount is the last
day of each Designated Term (as defined in
Clause 11.3 (Default interest));
(d) (other than by reason of negligence or default by
that Finance Party) a Loan not being made after the
Borrower has delivered a Request for that Loan; or
(e) any failure by a member of the Group to comply with
the Environmental Laws applicable to it or any
Environmental Licence held by it.
The Company's liability in each case includes any loss of
margin or other loss or expense on account of funds
borrowed, contracted for or utilised to fund any amount
payable under any Finance Document, any amount repaid or
prepaid or any Loan.
25.3 Acquisition financing indemnity
(a) The Company shall within 5 Business Days of demand
indemnify each Finance Party against any loss or
liability which that Finance Party suffers or incurs as a
consequence of any litigation proceeding arising, pending
or threatened against that Finance Party as a result of
the Offer (whether or not made) or of it agreeing to
finance or refinance any acquisition by the Company or
any person acting in concert with the Company of any
Shares or arising out of the use of proceeds of any
Utilisation ("relevant litigation") except to the extent
caused by its gross negligence or wilful misconduct.
(b) A Finance Party shall notify the Company promptly upon
becoming aware, and in reasonable detail, of any relevant
litigation and shall keep the Company informed of its
progress.
(c) A Finance Party shall conduct any relevant litigation in
good faith and will give careful consideration to the
views of the Company in relation to the appointment of
professional advisers and the conduct of the litigation
taking into account (to the extent practicable) both its
interests and the interests of the Company.
(d) A Finance Party may only concede or compromise any claim
in respect of any relevant litigation if it is acting
reasonably and has consulted the Company before so doing.
(e) Notwithstanding paragraphs (a) to (d) above, a Finance
Party is not required to disclose to the Company any
matter in respect of which it is under a duty of non-
disclosure or which is subject to any attorney/client
privilege, or which relates to a Finance Party's policy
or other extrinsic matters. Any information disclosed by
a Finance Party to the Company under this Clause 25.3
shall be subject to the same conditions of
confidentiality as those set out in Clause 29 (Disclosure
of information) in relation to disclosure to potential
transferees.
26. EVIDENCE AND CALCULATIONS
26.1 Accounts
Accounts maintained by a Finance Party in connection with
this Agreement are prima facie evidence of the matters to
which they relate.
26.2 Certificates and determinations
Any certification or determination by a Finance Party of
a rate or amount under the Finance Documents is prima
facie evidence of the matters to which it relates. Any
determination by a Finance Party of an amount under a
Finance Document shall contain a calculation of the
amount in reasonable detail.
26.3 Calculations
Interest (including any applicable MLA Cost) and the fee
payable under Clause 22.2 (Commitment fee) accrue from
day to day and are calculated on the basis of the actual
number of days elapsed and a year of 365 days or (in the
case of Commitment fee or where market practice so
dictates) 360 days. Guarantee fee is calculated on the
basis of the actual number of days in the relevant period
and a year of 365 days.
27. AMENDMENTS AND WAIVERS
27.1 Procedure
(a) Subject to Clause 27.2 (Exceptions), any term of the
Finance Documents may be amended or waived with the
agreement of the Company, the Majority Banks and the
Agent. The Agent may effect, on behalf of the Banks, an
amendment to which they or the Majority Banks have
agreed.
(b) The Agent shall promptly notify the other Parties of any
amendment or waiver effected under paragraph (a) above,
and any such amendment or waiver shall be binding on all
the Parties.
27.2 Exceptions
An amendment or waiver which relates to:-
(a) the definition of "Majority Banks" in Clause 1.1
(Definitions);
(b) an extension of the date for, or a decrease in an
amount or a change in the currency of, any payment
(including the Margin or any other amount of
interest or any fee) under the Finance Documents;
(c) an increase in a Bank's Commitment;
(d) the release of any security the subject of the
Debenture;
(e) a term of a Finance Document which expressly
requires the consent of each Bank; or
(f) Clause 31 (Pro rata sharing) or this Clause 27
(Amendments and waivers),
may not be effected without the consent of each Bank.
27.3 Waivers and remedies cumulative
The rights of each Finance Party under the Finance
Documents:-
(a) may be exercised as often as necessary;
(b) are cumulative and not exclusive of its rights under
the general law; and
(c) may be waived only in writing and specifically.
Delay in exercising or non-exercise of any such right is
not a waiver of that right.
28. CHANGES TO THE PARTIES
28.1 Transfers by Borrowers
No Borrower may assign, transfer, novate or dispose of
any of, or any interest in, its rights and/or obligations
under this Agreement.
28.2 Transfers by Banks
(a) Subject to paragraph (b) below, a Bank (the "Existing
Bank") may at any time assign, transfer or novate any of
its Commitments and/or rights and/or obligations in whole
or in part under this Agreement to a Qualifying Bank (the
"New Bank"). A partial assignment, transfer or novation
is only permitted in minimum amounts of 10,000,000 pounds
and if the Bank concerned assigns, transfers or novates a
pro rata portion of all its rights and obligations under
Facilities A, B and C.
(b) (i) The prior consent of the Company is required
for any such assignment, transfer or novation
referred to in paragraph (a) above, unless:-
(A) the New Bank is another Bank or an Affiliate of
a Bank; or
(B) a Default is outstanding.
However, the prior consent of the Company must not
be unreasonably withheld or delayed and will be
deemed to have been given if, within 14 days of
receipt by the Company of an application for
consent, it has not been expressly refused.
(ii) If the Guarantee has been, or is scheduled to be,
issued, the prior consent (not to be unreasonably
withheld or delayed) of the Issuing Bank is also
required.
(b) A transfer of obligations will be effective only if
either:-
(i) the obligations are novated in accordance with
Clause 28.3 (Procedure for novations); or
(ii) the New Bank confirms to the Agent and the Company
that it undertakes to be bound by the terms of this
Agreement as a Bank in form and substance
satisfactory to the Agent. On the transfer becoming
effective in this manner the Existing Bank shall be
relieved of its obligations under this Agreement to
the extent that they are transferred to the New
Bank.
(c) Nothing in this Agreement restricts the ability of a Bank
to sub-contract an obligation if that Bank remains liable
under this Agreement for that obligation.
(d) On each occasion (other than pursuant to the Syndication
Agreement) an Existing Bank assigns, transfers or novates
any of its rights and/or obligations under this
Agreement, the New Bank shall, on the date the
assignment, transfer and/or novation takes effect, pay to
the Agent for its own account a fee of 750 pounds.
(e) An Existing Bank is not responsible to a New Bank for:-
(i) the execution, genuineness, validity, enforceability
or sufficiency of any Finance Document or any other
document;
(ii) the collectability of amounts payable under any
Finance Document; or
(iii)the accuracy of any statements (whether written or
oral) made in or in connection with any Finance
Document.
(f) Each New Bank confirms to the Existing Bank and the other
Finance Parties that it:-
(i) has made its own independent investigation and
assessment of the financial condition and affairs of
each Borrower and its related entities in connection
with its participation in this Agreement and has not
relied exclusively on any information provided to it
by the Existing Bank in connection with any Finance
Document; and
(ii) will continue to make its own independent appraisal
of the creditworthiness of each Borrower and its
related entities while any amount is or may be
outstanding under this Agreement or any Commitment
is in force.
(g) Nothing in any Finance Document obliges an Existing Bank
to:-
(i) accept a re-transfer from a New Bank of any of the
rights and/or obligations assigned, transferred or
novated under this Clause; or
(ii) support any losses incurred by the New Bank by
reason of the non-performance by any Borrower of its
obligations under this Agreement or otherwise.
(h) Any reference in this Agreement to a Bank includes a New
Bank, but excludes a Bank if no amount is or may be owed
to or by that Bank under this Agreement and its
Commitment has been cancelled or reduced to nil.
28.3 Procedure for novations
(a) A novation is effected if:-
(i) the Existing Bank and the New Bank deliver to the
Agent a duly completed certificate, substantially in
the form of Part I of Schedule 5 (a "Novation
Certificate"); and
(ii) the Agent executes it.
(b) Each Party (other than the Existing Bank and the New
Bank) irrevocably authorises the Agent to execute any
duly completed Novation Certificate on its behalf.
(c) To the extent that they are expressed to be the subject
of the novation in the Novation Certificate:-
(i) the Existing Bank and the other Parties (the
"existing Parties") will be released from their
obligations to each other (the "discharged
obligations");
(ii) the New Bank and the existing Parties will assume
obligations towards each other which differ from the
discharged obligations only insofar as they are owed
to or assumed by the New Bank instead of the
Existing Bank;
(iii)the rights of the Existing Bank against the existing
Parties and vice versa (the "discharged rights")
will be cancelled; and
(iv) the New Bank and the existing Parties will acquire
rights against each other which differ from the
discharged rights only insofar as they are execrable
by or against the New Bank instead of the Existing
Bank,
all on the date of execution of the Novation Certificate
by the Agent or, if later, the date specified in the
Novation Certificate.
28.4 Target as Borrower
(a) If the Company wishes the Target to become a Borrower,
then it may deliver to the Agent the documents listed in
Part II of Schedule 2.
(b) On delivery of a Borrower Accession Agreement executed by
the Target and the Company, the Target will become a
Borrower. However, it may not utilise Facility C until
the Agent confirms to the other Finance Parties and the
Company that it has received all the documents referred
to in paragraph (a) above in form and substance
satisfactory to it. The Agent shall notify the Company
promptly upon receipt.
(c) Delivery of a Borrower Accession Agreement, executed by
the Target, constitutes confirmation by the Target that
the representations and warranties set out in Clause 18
(Representations and warranties) and to be made by the
Target on the date of the Borrower Accession Agreement
are correct, in respect of itself and its Subsidiaries,
as if made with reference to the facts and circumstances
then existing.
28.5 Reference Banks
If a Reference Bank (or, if a Reference Bank is not a
Bank, the Bank of which it is an Affiliate) ceases to be
one of the Banks, the Agent shall (in consultation with
the Company) appoint another Bank or an Affiliate of a
Bank to replace that Reference Bank.
28.6 Increased costs etc.
If:-
(a) a Bank assigns, transfers or novates any of its
Commitments and/or rights and/or obligations under
the Finance Documents or changes its Facility Office
without the prior consent of the Company; and
(b) as a result of circumstances existing at the date
the assignment, transfer, novation or change occurs,
a Borrower would be obliged to make a payment to the
New Bank or Bank acting through its new Facility
Office under Clause 13 (Taxes) or Clause 15
(Increased costs),
then, notwithstanding the provisions of Clause 13 (Taxes)
or Clause 15 (Increased costs), the relevant New Bank or
Bank acting through its new Facility Office is only
entitled to receive payment under those Clauses from a
Borrower to the same extent as the relevant Existing Bank
or Bank acting through its previous Facility Office would
have been if the assignment, transfer, novation or change
had not occurred
28.7 Register
The Agent shall keep a register of all the Parties and
shall supply any other Party (at that Party's expense)
with a copy of the register on request.
29. DISCLOSURE OF INFORMATION
(a) A Finance Party may disclose to one of its Affiliates or
any person (a "participant") with whom it is proposing to
enter, or has entered into, any kind of transfer,
participation or other agreement in relation to this
Agreement:-
(i) a copy of any Finance Document; and
(ii) any information which that Finance Party has
acquired under or in connection with any Finance
Document,
so long as disclosure of confidential information under
sub-paragraph (ii) above may only be disclosed to a
participant if the participant has agreed in writing with
the relevant Finance Party to keep the information
confidential on the same terms (with consequential
changes) as are set out in paragraph (b) below.
(b) Each Finance Party shall keep confidential and not,
without the prior consent of the Company, use any
information (other than information which is publicly
available other than as a result of a breach of this
paragraph (b)) supplied by or on behalf of any Borrower
under the Finance Documents otherwise than in connection
with the Finance Documents. However, each Finance Party
is entitled to disclose information:
(i) in connection with any legal or arbitration
proceedings arising out of or in connection with a
Finance Document; or
(ii) if required to do so by an order of a court of
competent jurisdiction whether under any procedure
for discovering documents or otherwise; or
(iii)pursuant to any law or regulation in accordance with
which that Bank is required or accustomed to act; or
(iv) to a governmental, banking, taxation or other
regulatory authority of any competent jurisdiction;
or
(v) to its accountants or legal advisers or any other
professional advisers.
30. SET-OFF
A Finance Party may set off any matured obligation owed
by a Borrower under this Agreement (to the extent
beneficially owned by that Finance Party) against any
obligation (whether or not matured) owed by that Finance
Party to that Borrower, regardless of the place of
payment, booking branch or currency of either obligation.
If the obligations are in different currencies, the
Finance Party may convert either obligation at a market
rate of exchange in its usual course of business for the
purpose of the set-off. If either obligation is
unliquidated or unascertained, the Finance Party may set
off in an amount estimated by it in good faith to be the
amount of that obligation. Nothing in this Clause 30
will be effective to create a charge.
31. PRO RATA SHARING
31.1 Redistribution
If any amount owing by a Borrower under this Agreement to
a Finance Party (the "recovering Finance Party") is
discharged by payment, set-off or any other manner other
than through the Agent in accordance with Clause 12
(Payments) (a "recovery"), then:-
(a) the recovering Finance Party shall, within 3
Business Days, notify details of the recovery to the
Agent;
(b) the Agent shall determine whether the recovery is in
excess of the amount which the recovering Finance
Party would have received had the recovery been
received by the Agent and distributed in accordance
with Clause 12 (Payments);
(c) subject to Clause 31.3 (Exceptions), the recovering
Finance Party shall, within 3 Business Days of
demand by the Agent, pay to the Agent an amount (the
"redistribution") equal to the excess;
(d) the Agent shall treat the redistribution as if it
were a payment by the Borrower concerned under
Clause 12 (Payments) and shall pay the
redistribution to the Finance Parties (other than
the recovering Finance Party) in accordance with
Clause 12.6 (Partial payments); and
(e) after payment of the full redistribution, the
recovering Finance Party will be subrogated to the
portion of the claims paid under paragraph (d)
above, and that Borrower will owe the recovering
Finance Party a debt which is equal to the
redistribution, immediately payable and of the type
originally discharged.
31.2 Reversal of redistribution
If under Clause 31.1 (Redistribution):-
(a) a recovering Finance Party must subsequently return
a recovery, or an amount measured by reference to a
recovery, to a Borrower; and
(b) the recovering Finance Party has paid a
redistribution in relation to that recovery,
each Finance Party shall, within 3 Business Days of
demand by the recovering Finance Party through the Agent,
reimburse the recovering Finance Party all or the
appropriate portion of the redistribution paid to that
Finance Party. Thereupon, the subrogation in
Clause 31.1(e) (Redistribution) will operate in reverse
to the extent of the reimbursement.
31.3 Exceptions
(a) A recovering Finance Party need not pay a redistribution
to the extent that it would not, after the payment, have
a valid claim against the Borrower concerned in the
amount of the redistribution pursuant to Clause 31.1(e)
(Redistribution).
(b) A recovering Finance Party is not obliged to share with
any other Finance Party any amount which the recovering
Finance Party has received or recovered as a result of
taking legal proceedings, if that other Finance Party had
an opportunity to participate in those legal proceedings,
but did not do so and did not take separate legal
proceedings.
32. SEVERABILITY
If a provision of any Finance Document is or becomes
illegal, invalid or unenforceable in any jurisdiction,
that shall not affect:-
(a) the legality, validity or enforceability in that
jurisdiction of any other provision of the Finance
Documents; or
(b) the legality, validity or enforceability in other
jurisdictions of that or any other provision of the
Finance Documents.
33. COUNTERPARTS
A 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. NOTICES
34.1 Giving of notices
All notices or other communications under or in
connection with the Finance Documents shall be given in
writing or by telex or facsimile. Any such notice will be
deemed to be given as follows:-
(a) if in writing, when delivered;
(b) if by telex, when despatched, but only if, at the
time of transmission, the correct answerback appears
at the start and at the end of the sender's copy of
the notice; and
(c) if by facsimile, when received.
However, a notice given in accordance with the above but
received on a non-working day or after business hours in
the place of receipt will only be deemed to be given on
the next working day in that place.
34.2 Addresses for notices
(a) The address, telex number and facsimile number of each
Party (other than the Agent) for all notices under or in
connection with the Finance Documents are:-
(i) that notified by that Party for this purpose to the
Agent on or before it becomes a Party; or
(ii) any other notified by that Party for this purpose to
the Agent by not less than five Business Days'
notice.
(b) The address, telex number and facsimile number of the
Agent is:-
101 Moorgate
London EC2M 6SB
Telex No: 887139 ABN ALG
Facsimile No: 0171 588 2975
Attention: Credit Administration
or such other as the Agent may notify to the other
Parties by not less than 5 Business Days' notice.
(c) The Agent shall, promptly upon request from any Party,
give to that Party the address, telex number or facsimile
number of any other Party applicable at the time for the
purposes of this Clause.
34.3 Facsimile notices
Each Borrower shall indemnify the Agent against any loss
or liability which the Agent incurs as a result of the
Agent accepting and/or acting upon any instructions under
the Finance Documents received by the Agent from that
Borrower by facsimile and which may not have been
incurred if, at the time of receipt, the Agent had been
given the instructions other than by facsimile.
35. GOVERNING LAW
This Agreement is governed by English law.
This Agreement has been entered into on the date stated at the
beginning of this Agreement.
SCHEDULE 1
BANKS AND COMMITMENTS
Banks Commitments
ABN AMRO BANK N.V. )
BANK OF AMERICA NATIONAL TRUST AND ) AS PER
SAVINGS ASSOCIATION )
SYNDICATION
UNION BANK OF SWITZERLAND ) LETTER
SCHEDULE 2
CONDITIONS PRECEDENT DOCUMENTS
PART I
TO BE DELIVERED BEFORE THE FIRST LOAN
1. A copy of the memorandum and articles of association and
certificate of incorporation of the Company.
2. A copy of a resolution of the board of directors of the
Company:-
(a) approving the terms of, and the transactions
(including the Acquisition) contemplated by, this
Agreement and resolving that it execute this
Agreement, the Debenture and the Fee Letters;
(b) authorising a specified person or persons to execute
this Agreement and the Fee Letters on its behalf and
its seal be affixed to the Debenture; and
(c) authorising a specified person or persons, on its
behalf, to sign and/or despatch all other documents
and notices to be signed and/or despatched by it
under or in connection with this Agreement.
3. A specimen of the signature of each person authorised by
the resolution referred to in paragraph 2 above.
4. A copy of the Press Release and a copy of the Offer
Document.
5. The Debenture, duly executed by the Company.
6. A certificate of an authorised signatory of the Company
certifying that each copy document specified in
paragraphs 1 and 2 of Part I of this Schedule 2 is
correct, complete and in full force and effect as at a
date no earlier than the date of this Agreement.
7. Written confirmation from the Company that, as at the
date on which the Press Release is issued, the board of
directors of the Target has recommended to the
shareholders of the Target acceptance of the Offer.
8. Written confirmation from the Parent and the Company that
equity and/or capital contributions of a minimum amount
agreed in the Syndication Letter has been subscribed for
in, or on lent to, the Company and confirmation from the
Company that that amount has been or, together with the
proceeds of the drawdown of the first Loan will be,
applied in full on or prior to the first Drawdown Date in
accordance with the terms of this Agreement.
9. A report from Coopers & Lybrand on the financial model
(and its assumptions) in relation to the Acquisition,
prepared by the Company or its advisers and addressed to
the Finance Parties.
10. A legal opinion of Allen & Overy, legal advisers to the
Arrangers, addressed to the Finance Parties,
substantially in the form of Part I of Schedule 8.
PART II
TO BE DELIVERED BY THE TARGET
1. A Borrower Accession Agreement, duly executed by the
Target and the Company.
2. A copy of the memorandum and articles of association and
certificate of incorporation of the Target.
3. A copy of a resolution of the board of directors of the
Target:-
(a) approving the terms of, and the transactions
contemplated by, the Borrower Accession Agreement
and resolving that it execute the Borrower Accession
Agreement;
(b) authorising a specified person or persons to execute
the Borrower Accession Agreement on its behalf; and
(c) authorising a specified person or persons, on its
behalf, to sign and/or despatch all other documents
and notices to be signed and/or despatched by it
under or in connection with this Agreement.
4. A certificate of a director of the Target confirming that
utilisation of Facility C in full would not cause any
borrowing limit binding on it to be exceeded.
5. A specimen of the signature of each person authorised by
the resolution referred to in paragraph (3) above.
6. The latest audited consolidated accounts of the Target.
7. If not already received by the Agent, copies of:
(a) the Licence; and
(b) the Pooling and Settlement Agreement.
8. A certificate of an authorised signatory of the Target
certifying that each copy document specified in Part II
of this Schedule 2 is correct, complete and in full force
and effect as at a date no earlier than the date of the
Borrower Accession Agreement.
9. A legal opinion of Allen & Overy, legal advisers to the
Agent, addressed to the Finance Parties, substantially in
the form of Part II of Schedule 8.
SCHEDULE 3
CALCULATION OF THE MLA COST
(a) The MLA Cost for a Loan for its Interest Period(s) is
calculated in accordance with the following formula:-
BY + L(Y-X) + S(Y-Z)
-------------------- % per annum = MLA Cost
100-(B+S)
where on the day of application of the formula:-
B is the percentage of the Agent's eligible
liabilities which the Bank of England requires the
Agent to hold on a non-interest-bearing deposit
account in accordance with its cash ratio
requirements;
Y is the rate at which Sterling deposits are offered
by the Agent to leading banks in the London
interbank market at or about 11.00 a.m. on that day
for the relevant period;
L is the percentage of eligible liabilities which the
Bank of England requires the Agent to maintain as
secured money with members of the London Discount
Market Association and/or as secured call money with
certain money brokers and gilt-edged primary market
makers;
X is the rate at which secured Sterling deposits in
the relevant amount may be placed by the Agent with
members of the London Discount Market Association
and/or as secured call money with certain money
brokers and gilt-edged primary market makers at or
about 11.00 a.m. on that day for the relevant
period;
S is the percentage of the Agent's eligible
liabilities which the Bank of England requires the
Agent to place as a special deposit; and
Z is the interest rate per annum allowed by the Bank
of England on special deposits.
(b) For the purposes of this Schedule 3:-
(i) "eligible liabilities" and "special deposits" have
the meanings given to them at the time of
application of the formula by the Bank of England;
(ii) "relevant period" in relation to a Loan, means:-
(A) if the relevant Interest Period is 3 months or
less, that Interest Period; or
(B) if the relevant Interest Period is more than 3
months, 3 months.
(c) In the application of the formula, B, Y, L, X, S and Z
are included in the formula as figures and not as
percentages, e.g. if B = 0.5% and Y = 15%, BY is
calculated as 0.5 x 15.
(d) (i) The formula is applied on the first day of the
relevant Interest Period.
(ii) Each rate calculated in accordance with the formula
is, if necessary, rounded upward to the nearest four
decimal places.
(e) If the Agent determines that a change in circumstances
has rendered, or will render, the formula inappropriate,
the Agent (after consultation with the Banks) shall
notify the Company of the manner in which the MLA Cost
will subsequently be calculated. The manner of
calculation so notified by the Agent shall, in the
absence of manifest error, be binding on all the Parties.
SCHEDULE 4
FORM OF REQUEST
To: ABN AMRO BANK N.V. as Agent
From: [ENTERGY POWER UK PLC/LONDON ELECTRICITY plc]
Date: [ ]
ENTERGY POWER UK PLC - 1,250,000,000 Pounds Revolving Credit
Agreement
dated 17th December, 1996
1. [We wish to borrow a Facility A/Facility B/Facility C*
Loan as follows:-
(a) Drawdown Date:
[ ]
(b) Purpose: [ ]
(c) Amount: [ ]
(d) [First]** Interest Period:
[ ]
(e) Payment instructions:
[ ].]*
[We wish the Issuing Bank to issue the Guarantee as
follows:-
(a) Amount: [ ]
(b) Issue Date:
[ ]
(c) Expiry Date:
[ ]
(d) Delivery instructions:
[ ]]*
2. We confirm that each condition specified in [Clause 4.2
(Further conditions precedent)/Clause 4.3 (Conditions
precedent during the Certain Funds Period]* is satisfied
on the date of this Request.
By:
[ENTERGY POWER UK PLC/LONDON ELECTRICITY plc]
Authorised Signatory
SCHEDULE 5
FORMS OF ACCESSION DOCUMENTS
PART I
NOVATION CERTIFICATE
To: ABN AMRO BANK N.V. as Agent
From: [THE EXISTING
BANK] and [THE NEW BANK] Date:
[ ]
ENTERGY POWER UK PLC - 1,250,000,000 pounds Revolving Credit
Agreement
dated 17th December, 1996
We refer to Clause 28.3 (Procedure for novations).
1. We [ ] (the
"Existing Bank") and
[ ] (the "New Bank")
agree to the Existing Bank and the New Bank novating all
the Existing Bank's Commitment(s) and/or rights and
obligations referred to in the Schedule in accordance
with Clause 28.3 (Procedure for novations).
2. The specified date for the purposes of Clause 28.3(c) is
[date of novation].
3. The Facility Office and address for notices of the New
Bank for the purposes of Clause 34.2 (Addresses for
notices) are set out in the Schedule.
4. This Novation Certificate is governed by English law.
THE SCHEDULE
Commitments/Rights and obligations to be novated
[Details of the Commitments/rights and obligations of the
Existing Bank to be novated].
[New Bank]
[Facility Office Address for notices]
[Existing Bank] [New Bank] ABN AMRO BANK
N.V.
By: By: By:
Date: Date: Date:
PART II
BORROWER ACCESSION AGREEMENT
To: ABN AMRO BANK N.V. as Agent
From: LONDON ELECTRICITY plc and ENTERGY POWER UK PLC
[ ], 199[ ]
ENTERGY POWER UK PLC - 1,250,000,000 pounds Revolving Credit
Agreement
dated 17th December, 1996 (the "Credit Agreement")
We refer to Clause 28.4 (Target as Borrower).
London Electricity plc of Templar House, 81-87 High Holborn,
London WC1V 6NU (Registered no. 2366852) (the "Proposed
Borrower") agrees to become a Borrower and to be bound by the
terms of the Credit Agreement as a Borrower in accordance with
Clause 28.4 (Target as Borrower).
The address for notices of the Proposed Borrower for the
purposes of Clause 34.2 (Addresses for notices) is:-
[
]
This Agreement is governed by English law.
By:
LONDON ELECTRICITY plc
Authorised Signatory
By:
ENTERGY POWER UK PLC
Authorised Signatory
PART III
FORM OF SYNDICATION AGREEMENT
SUPPLEMENTAL AGREEMENT
DATED [ ]
relating to a 1,250,000,000 pounds Credit
Agreement dated 17th December, 1996
for
ENTERGY POWER UK PLC
arranged by
ABN AMRO BANK N.V.
BANK OF AMERICA INTERNATIONAL LIMITED
UNION BANK OF SWITZERLAND
with
ABN AMRO BANK N.V.
as Agent
ALLEN & OVERY
London
THIS AGREEMENT is dated
[ ] between:
(1) ENTERGY POWER UK PLC (Registered No. 3261188) (the
"Company");
(2) LONDON ELECTRICITY plc (Registered No. 2366852) (the
"Target")* ;
(3) ABN AMRO BANK N.V., BANK OF AMERICA INTERNATIONAL LIMITED
and UNION BANK OF SWITZERLAND as arrangers (in this
capacity the "Arrangers");
(4) ABN AMRO BANK N.V., BANK OF AMERICA NATIONAL TRUST AND
SAVINGS ASSOCIATION and UNION BANK OF SWITZERLAND as the
banks party to the Credit Agreement (as defined below) as
at today's date (the "Existing Banks");
(5) THE FINANCIAL INSTITUTIONS listed in Schedule 1 as the
banks who wish to accede to the Credit Agreement as Banks
(the "New Banks"); and
(6) ABN AMRO BANK N.V. as agent (in this capacity the
"Agent").
IT IS AGREED as follows:
1. INTERPRETATION
1.1 Definitions
In this Agreement, unless the contrary intention appears
or the context otherwise requires:
"Credit Agreement"
means the Original Credit Agreement as amended pursuant
to Clause 4 (Nature of this Agreement) of this Agreement.
"Effective Date"
means
[
].
"Original Credit Agreement"
means the Credit Agreement dated 17th December, 1996
between the Company, the Arrangers, the Existing Banks
and the Agent.
1.2 Incorporation of Original Credit Agreement
interpretations
(a) Terms defined in the Original Credit Agreement shall,
unless the contrary intention appears or the context
otherwise requires, have the same meaning in this
Agreement.
(b) Clauses 1.2 (Construction), 32 (Severability) and 33
(Counterparts) of the Original Credit Agreement shall
apply to this Agreement, as though they were set out in
full in this Agreement but as if references to the
Original Credit Agreement are to be construed as
references to this Agreement.
2. CONSENT AND CONFIRMATION
[(a)]1 The Company, [the Target]2 the Arrangers, the
Existing Banks and the Agent each consent to the New
Banks becoming Banks and confirm that, except as
expressly provided by the terms of this Agreement, each
of the Finance Documents shall continue in full force and
effect.
[(b) It is acknowledged that the Guarantee will not be
issued.]1.
3. NOVATION
3.1 Novation of Commitments and related rights and
obligations
On the Effective Date (regardless of whether a Default is
then continuing):
(a) each New Bank will become a Bank under the Credit
Agreement with a Facility A Commitment, Facility B
Commitment and Facility C Commitment as set out
opposite its name in Schedule 2;
(b) each Existing Bank's Facility A Commitment,
Facility B Commitment and Facility C Commitment
shall be and be deemed to be reduced down to, the
respective amounts set out opposite its name in
Schedule 2; and
(c) each New Bank will automatically obtain and assume,
and undertakes to perform, all of the rights and
obligations of a Bank under and in respect of each
of the Finance Documents in respect of the rights
and obligations transferred to it under
paragraphs (a) and (b) above[, including, without
limitation, its corresponding proportion of the
rights and obligations of the Existing Banks in
respect of:]
[List outstanding term loans and Guarantee, if
issued.]
3.2 Amounts due on or before the Effective Date
(a) All amounts (if any) payable to an Existing Bank by the
Borrowers on or before the Effective Date (including,
without limitation, all interest and fees payable on the
Effective Date) in respect of any period ending prior to
the Effective Date shall be for the account of the
Existing Banks, and none of the New Banks shall have any
interest in, or any rights in respect of, any such
amounts.
(b) If any Facility A Loan or Facility C Loan falls to be
made on the Effective Date:
(i) the Agent will promptly notify each of the New Banks
of that fact (and the amount of its participation in
that Facility A Loan or Facility C Loan in
accordance with sub-paragraph (ii) below); and
(ii) each Existing Bank and each New Bank shall
participate in that Facility A Loan or Facility C
Loan (subject to the terms of the Credit Agreement)
as if the novation of the Facility A Commitments and
the Facility C Commitments under Clauses 3.1(a) and
(b) (Novation of Commitments and related rights and
obligations) of this Agreement had taken effect
prior to opening of business on the Business Day
before the Effective Date,
and the Company acknowledges that no Existing Bank will
be obliged to participate in any such Loan to any greater
extent.
3.3 Administrative details
Each New Bank has delivered to the Agent its initial
details for the purposes of Clause 34 (Notices) of the
Credit Agreement.
4. NATURE OF THIS AGREEMENT
The novation of Commitments and rights and obligations
contemplated by this Agreement shall take effect (in
accordance with its terms) as a novation so that:
(a) Schedule 1 to this Agreement is substituted for
Schedule 1 to the Credit Agreement on the Effective
Date; and
(b) Clause 28.3 (Procedure for novations) of the Credit
Agreement shall apply to the Commitments, rights and
obligations transferred, assumed and released under
Clause 3.1 (Novation of Commitments and related
rights and obligations) of this Agreement and to the
associated rights and obligations under the Finance
Documents, as if this Agreement were a Novation
Certificate.
5. GOVERNING LAW
This Agreement is governed by English law.
This Agreement has been entered into on the date stated at the
beginning of this Agreement.
SCHEDULE 1
BANKS AND COMMITMENTS
Banks Facility A Facility B Facility C
Commitment Commitment Commitment
Pounds Pounds Pounds
[
SIGNATORIES
(to the Syndication Agreement)
Company
ENTERGY POWER UK PLC
By:
Target
LONDON ELECTRICITY plc
By:
Arrangers and Existing Banks
ABN AMRO BANK N.V.
By:
BANK OF AMERICA INTERNATIONAL LIMITED
By:
BANK OF AMERICA NATIONAL TRUST
AND SAVINGS ASSOCIATION
By:
UNION BANK OF SWITZERLAND
By:
New Banks
[ ]
Agent
ABN AMRO BANK N.V.
By:
SCHEDULE 6
FORM OF GUARANTEE
THIS DEED is dated [ ] 199[ ] and made
by ABN AMRO BANK N.V. (the "Guarantor" which expression
includes its successors and assigns).
BACKGROUND
(A) ENTERGY POWER UK PLC (Registered No: 3261188) (the
"Company") has issued loan notes of an aggregate
principal amount of pounds[ ] (the
"Loan Notes") in connection with the offer for the shares
in London Electricity plc.
(B) The Guarantor has agreed to guarantee payments due from
the Company to holders of the Loan Notes (the
"Noteholders") subject to the terms of this Deed.
IT IS AGREED as follows:
1. (a) Subject to the other terms of this Deed, the
Guarantor irrevocably and unconditionally guarantees
to each Noteholder for the time being and within
five business days of a written demand by that
Noteholder, the payment of the principal amount of
each Loan Note held by it and the payment of any
interest in respect of that principal amount;
(b) the aggregate liability of the Guarantor under this
Deed in respect of the principal amount of the Loan
Notes is limited to
pounds[ ]; and
(c) the aggregate liability of the Guarantor under this
Deed in respect of interest on the Loan Notes is
limited to pounds[ ].
In this Guarantee a "business day" is a day on which
banks are open for business (other than a Saturday or a
Sunday) in London.
2. To be valid, any demand by a Noteholder under Clause 1
above must:
(a) be in writing signed by the Noteholder with such
signature being confirmed by the Noteholder's
bankers or solicitors;
(b) state that the Company has defaulted in payment of
sums due in respect of the Loan Notes specifying the
date of the default, the applicable period of grace
(if any), the amount claimed from the Guarantor and
the amount of principal and interest in respect of
which the default by the Company has been made; and
(c) be delivered to the Guarantor at its address at
[
] within 30 days of the due date of the
relevant payment.
3. This guarantee is to be a continuing guarantee and
(subject to Clause 5 below) shall remain in force until
the date on which all moneys expressed to be payable by
the Company under the terms of the Loan Notes shall have
been paid.
4. (a) The obligations of the Guarantor under this
guarantee shall not be affected by any concession or
arrangement granted or made to or with the Company
or by the liquidation of the Company;
(b) the liability of the Guarantor is not to be
increased or extended in any way by any compromise
or arrangement but if the effect of any such
compromise or arrangement is to extend the time of
payment by the Company of any principal or interest
secured by the Loan Notes and which the Guarantor is
for the time being or may become liable to pay in
respect thereof, and, without prejudice to Clause 5
below, the Guarantor shall have the benefit of that
extension of time; and
(c) the Guarantor will not be bound by any
variation of the rights of the Noteholders unless
that variation shall have been made with the prior
written consent of the Guarantor.
5. Unless otherwise agreed by the Guarantor, the liability
of the Guarantor under this guarantee shall terminate on
the date falling
[ ] or (if
earlier) on the date on which all moneys expressed to be
payable by the Company under the terms of the Loan Notes
shall have been paid, except that the Guarantor shall
remain liable in respect of any claims or demands validly
made prior to that date to the extent not satisfied or
withdrawn by that date.
6. This Deed is governed by English Law.
The Guarantor has executed this Deed on the day and year first
above written.
[Executed as a Deed by ABN AMRO BANK N.V. )
acting by: )
[ ] )
and [ ]] )
SCHEDULE 7
FORM OF DEBENTURE
DEBENTURE
DATED 17th December, 1996
BETWEEN
ENTERGY POWER UK PLC
- and -
ABN AMRO BANK N.V.
London
TABLE OF CONTENTS
Clause Page
1. Interpretation 111
2. Fixed Security 113
3. Floating charge 113
4. Representations and warranties 114
5. Undertakings 114
7. When security becomes enforceable 116
8. Enforcement of security 116
9. Receiver 117
10. Powers of Receiver 118
12. Application of proceeds 120
13. Expenses and indemnity 120
14. Delegation 121
15. Further assurances 121
16. Power of attorney 121
17. Miscellaneous 121
18. Release 122
19. Governing law 122
Schedules
1. Form of notice of the Account Bank 123
2. Form of acknowledgement of the bank operating the
Security Accounts 124
Signatories 125
THIS DEED is dated 17th December, 1996 between:
(1) ENTERGY POWER UK PLC (Registered number 3261188) (the
"Chargor"); and
(2) ABN AMRO BANK N.V. (the "Agent") as agent and trustee for
the Finance Parties (as defined in the Credit Agreement
defined below).
BACKGROUND:
(A) The Chargor enters into this Deed in connection with the
Credit Agreement (as defined below).
(B) It is intended that this document takes effect as a deed
notwithstanding the fact that a party may only execute
this document under hand.
IT IS AGREED as follows:
1. INTERPRETATION
1.1 Definitions
In this Deed:
"Account Bank"
means a person with whom a Security Account is maintained
under Clause 6 (Security Accounts).
"Credit Agreement"
means the 1,250,000,000 pounds credit agreement dated 17th
December, 1996 between (among others) the parties to this
Deed.
"Group Shares"
means any shares in any member of the Group from time to
time held by the Chargor or a nominee on its behalf,
including the shares of the Chargor in the Target.
"Receiver"
means a receiver and manager or (if the Agent so
specifies in the relevant appointment) a receiver, in
either case, appointed under this Deed.
"Related Rights"
means:
(a) any dividend or interest paid or payable in relation
to any Shares;
(b) any stocks, shares, securities, rights, moneys or
property accruing or offered at any time in relation
to any Shares by way of redemption, substitution,
exchange, bonus or preference, under option rights
or otherwise; and
(c) all dividends, interest or other income in respect
of any such asset as is referred to in paragraph (b)
above.
"Secured Liabilities"
means all present and future obligations and liabilities
(whether actual or contingent and whether owed jointly or
severally or in any other capacity whatsoever) of the
Borrowers to any Finance Party under the Finance
Documents except for any obligation which, if it were so
included, would result in this Deed contravening Section
151 of the Companies Act 1985. The term "Finance
Document" includes all amendments and supplements.
"Security Account"
means an account of the Chargor established under
Clause 6 (Security accounts).
"Security Assets"
means all assets of the Chargor the subject of any
security created by this Deed.
"Security Period"
means the period beginning on the date of this Deed and
ending on the date on which the Agent is satisfied that
all the Secured Liabilities have been unconditionally and
irrevocably paid and discharged in full.
"Shares"
means the Group Shares, and any other stocks, shares,
debentures, bonds or other securities and investments
held by the Chargor.
1.2 Construction
(a) Capitalised terms defined in the Credit Agreement have,
unless expressly defined in this Deed, the same meaning
in this Deed.
(b) The provisions of Clause 1.2 of the Credit Agreement
apply to this Deed as though they were set out in full in
this Deed except that references to the Credit Agreement
are to be construed as references to this Deed.
(c) If the Agent (acting reasonably) considers that an amount
paid by any Borrower to a Finance Party under a Finance
Document is capable of being avoided or otherwise set
aside on the liquidation or administration of that
Borrower or otherwise, then that amount shall not be
considered to have been irrevocably paid for the purposes
of this Deed.
(d) A reference in this Deed to any assets includes, unless
the context otherwise requires, present and future
assets.
2. FIXED SECURITY
The Chargor, as beneficial owner and as security for the
payment of all the Secured Liabilities, charges in favour
of the Agent:-
(a) by way of a first equitable mortgage all Shares held
by it and/or any nominee on its behalf and all
Related Rights accruing to the Shares; and
(b) by way of first fixed charge:-
(i) (to the extent not effectively mortgaged under
paragraph (a) above) its interest in all the
Shares and their Related Rights;
(ii) to the fullest extent permitted by law, all
moneys standing to the credit of any account
(including the Security Accounts) with any
person and the debts represented by them;
(iii) all of the Chargor's book and other debts,
the proceeds of the same and all other moneys
due and owing to the Chargor and the benefit of
all rights, securities and guarantees of any
nature enjoyed or held by it in relation to any
of the foregoing; and
(iv) to the extent that they are able to be the
subject of any Security Interest, the benefit
of all licences, consents and authorisations
(statutory or otherwise) held in connection
with its business or the use of any Security
Asset specified in any other sub-paragraph in
this Clause and the right to recover and
receive all compensation which may be payable
to it in respect of them.
The Agent may convert the equitable mortgage created in
paragraph (a) above into a legal mortgage if a Default is
outstanding. The mortgages and charges created by this
Clause 2 are made with full title guarantee.
3. FLOATING CHARGE
3.1 Creation of floating charge
The Chargor, as beneficial owner and as security for the
payment of all of the Secured Liabilities, charges in
favour of the Agent by way of a first floating charge all
its assets not otherwise effectively mortgaged or charged
by way of fixed mortgage or charge by Clause 2 (Fixed
Security).
3.2 Conversion
The Agent may by notice to the Chargor convert the
floating charge created by this Deed into a fixed charge
as regards all or any of the Chargor's assets specified
in the notice if:
(a) an Event of Default is outstanding; or
(b) the Agent considers those assets to be in danger of
being seized or sold under any form of distress,
attachment, execution or other legal process or to
be otherwise in jeopardy.
4. REPRESENTATIONS AND WARRANTIES
4.1 Representations and warranties
The Chargor makes the representations and warranties set
out in this Clause 4 to each Finance Party.
4.2 Security
This Deed creates those Security Interests it purports to
create and is not liable to be avoided or otherwise set
aside on the liquidation or administration of the Chargor
or otherwise.
4.3 Shares
The Shares are fully paid and the Chargor is the sole
beneficial owner of them, free from any Security Interest
or option.
4.4 Times for making representations and warranties
The representations and warranties set out in this
Clause 4 are made on the date of this Deed and are deemed
to be repeated by the Chargor on each date during the
Security Period with reference to the facts and
circumstances then existing.
5. UNDERTAKINGS
5.1 Duration
The undertakings in this Clause 5 remain in force
throughout the Security Period.
5.2 Restrictions on dealing
The Chargor shall not (except as permitted under the
Credit Agreement):-
(a) create or permit to subsist any Security Interest on
any Security Asset other than any Security Interest
created by this Deed; or
(b) sell, transfer, grant, or lease or otherwise dispose
of any Security Asset, except for the disposal in
the ordinary course of trade of any Security Asset
subject to the floating charge created under
Clause 3.1 (Creation of floating charge).
5.3 Book debts and receipts
The Chargor shall:-
(a) get in and realise the Chargor's:
(i) securities to the extent held by way of
temporary investment; and
(ii) book and other debts and other moneys,
in the ordinary course of its business and hold the
proceeds of the getting in and realisation (until
payment into a Security Account if required in
accordance with paragraph (b) below) upon trust for
the Agent; and
(b) save to the extent that the Agent otherwise agrees,
pay the proceeds of the getting in and realisation
into a Security Account.
5.4 Notice to bank operating an account
The Chargor will give notice to any bank (other than the
Agent) operating an account of the Chargor on the date of
this Deed or (if later) the date the account is opened,
substantially in the form of Schedule 1, and shall use
its reasonable endeavours to procure that the relevant
bank acknowledges the notice substantially in the form of
Schedule 2.
5.5 Deposit of Shares
The Chargor shall:-
(a) deposit with the Agent, or as the Agent may direct,
all certificates, bearer instruments, and other
documents of title or evidence of ownership in
relation to the Shares and their Related Rights; and
(b) execute and deliver to the Agent all share transfers
and other documents which may be requested by the
Agent in order to enable the Agent or its nominees
to be registered as the owner or otherwise obtain a
legal title to the Shares and their Related Rights.
6. SECURITY ACCOUNTS
6.1 Accounts
All Security Accounts must be maintained at a branch of
the Account Bank approved by the Agent. The initial
Account Bank is the Agent.
6.2 Change of Account Bank
(a) The Account Bank may be changed to another bank or
financial institution if the Agent so requires.
(b) A change only becomes effective upon the proposed new
Account Bank agreeing with the Agent and the Chargor, in
a manner satisfactory to the Agent, to fulfil the role of
the Account Bank under this Deed.
(c) In the event of a change of Account Bank, the amount (if
any) standing to the credit of the Security Accounts
maintained with the old Account Bank shall be transferred
to the corresponding Security Accounts maintained with
the new Account Bank forthwith upon the appointment
taking effect. The Chargor shall take any action which
the Agent may require to facilitate a change of Account
Bank and any transfer of credit balances (including the
execution of bank mandate forms).
6.3 Interest
Amounts standing to the credit of each Security Account
shall bear interest at a rate considered by the Account
Bank to be a fair market rate.
6.4 Withdrawals
(a) Except with the prior consent of the Agent, the Chargor
shall not withdraw any moneys standing to the credit of a
Security Account except for a purpose not prohibited by
the Credit Agreement at a time when the security
constituted by this Deed is not enforceable or has not
been enforced.
(b) The Agent (or a Receiver) may (subject to the payment of
any claims having priority to this security) withdraw
amounts standing to the credit of a Security Account to
meet an amount due and payable under the Finance
Documents when it is due and payable.
7. WHEN SECURITY BECOMES ENFORCEABLE
The security constituted by this Deed shall become
immediately enforceable upon the occurrence of an Event
of Default and the power of sale, shall be immediately
exerciseable upon and at any time after the occurrence of
any Event of Default. After the security constituted by
this Deed has become enforceable, the Agent may in its
absolute discretion enforce all or any part of the
security in any manner it sees fit or as the Majority
Banks direct.
8. ENFORCEMENT OF SECURITY
8.1 General
For the purposes of all powers implied by statute, the
Secured Liabilities are deemed to have become due and
payable on the date of this Deed and section 103 and
section 93 of the Law of Property Act 1925 shall not
apply to the security constituted by this Deed.
8.2 Shares
After the security constituted by this Deed has become
enforceable, the Agent may exercise (in the name of the
Chargor and without any further consent or authority on
the part of the Chargor) any voting rights and any powers
or rights which may be exercised by the person or persons
in whose name any Share and its Related Rights are
registered or who is the holder of any of them or
otherwise (including all the powers given to trustees by
Section 10(3) and (4) of the Trustee Act, 1925 as amended
by Section 9 of the Trustee Investment Act, 1961 in
respect of securities or property subject to a trust).
Until that time, the voting rights, powers and other
rights in respect of the Shares shall (if exercisable by
the Agent) be exercised in any manner which the Chargor
may direct in writing.
8.3 Contingencies
If the Agent enforces the security constituted by this
Deed at a time when no amounts are due under the Finance
Documents but at a time when amounts may or will become
so due, the Agent (or the Receiver) may pay the proceeds
of any recoveries effected by it into a Security Account.
8.4 No liability as mortgagee in possession
Neither the Agent nor any Receiver will be liable, by
reason of entering into possession of a Security Asset,
to account as mortgagee in possession or for any loss on
realisation or for any default or omission for which a
mortgagee in possession might be liable.
8.5 Agent of the Chargor
Each Receiver is deemed to be the agent of the Chargor
for all purposes and accordingly is deemed to be in the
same position as a Receiver duly appointed by a mortgagee
under the Law of Property Act 1925. The Chargor alone
shall be responsible for his contracts, engagements,
acts, omissions, defaults and losses and for liabilities
incurred by him and no Finance Party shall incur any
liability (either to the Chargor or to any other person)
by reason of the Agent making his appointment as a
Receiver or for any other reason.
8.6 Protection of third parties
No person (including a purchaser) dealing with the Agent
or a Receiver or its or his agents will be concerned to
enquire:-
(a) whether the Secured Liabilities have become payable;
or
(b) whether any power which the Agent or the Receiver is
purporting to exercise has become execrable; or
(c) whether any money remains due under the Finance
Documents; or
(d) how any money paid to the Agent or to the Receiver
is to be applied.
8.7 Redemption of prior mortgages
At any time after the security constituted by this Deed
has become enforceable, the Agent may:-
(a) redeem any prior Security Interest against any
Security Asset; and/or
(b) procure the transfer of that Security Interest to
itself; and/or
(c) settle and pass the accounts of the prior mortgagee,
chargee or encumbrancer; any accounts so settled and
passed shall be conclusive and binding on the
Chargor.
All principal moneys, interest, costs, charges and
expenses of and incidental to any such redemption and/or
transfer shall be paid by the Chargor to the Agent on
demand.
9. RECEIVER
9.1 Appointment of Receiver
At any time after the security constituted by this Deed
becomes enforceable or, if the Chargor so requests the
Agent in writing, at any time, the Agent may without
further notice appoint under seal or in writing under its
hand any one or more persons to be a Receiver of all or
any part of the Security Assets in like manner in every
respect as if the Agent had become entitled under the Law
of Property Act 1925 to exercise the power of sale
conferred under the Law of Property Act 1925.
9.2 Removal
The Agent may by writing under its hand (subject to any
requirement for an order of the court in the case of an
administrative receiver) remove any Receiver appointed by
it and may, whenever it deems it expedient, appoint a new
Receiver in the place of any Receiver whose appointment
may for any reason have terminated.
9.3 Remuneration
The Agent may fix the remuneration of any Receiver
appointed by it.
9.4 Relationship with Agent
To the fullest extent permitted by law, any right, power
or discretion conferred by this Deed (either expressly or
impliedly) upon a Receiver of the Security Assets may
after the security created by this Deed becomes
enforceable be exercised by the Agent in relation to any
Security Asset without first appointing a Receiver or
notwithstanding the appointment of a Receiver.
10. POWERS OF RECEIVER
10.1 General
(a) Each Receiver has, and is entitled to exercise, all of
the rights, powers and discretions set out below in this
Clause 10 in addition to those conferred by the Law of
Property Act 1925 on any receiver appointed under the Law
of Property Act 1925.
(b) If there is more than one Receiver holding office at the
same time, each Receiver may (unless the document
appointing him states otherwise) exercise all of the
powers conferred on a Receiver under this Deed
individually and to the exclusion of any other Receivers.
(c) A Receiver who is an administrative receiver of the
Chargor has all the rights, powers and discretions of an
administrative receiver under the Insolvency Act 1986.
10.2 Possession
A Receiver may take immediate possession of, get in and
collect any Security Assets.
10.3 Carry on business
A Receiver may carry on the business of the Chargor as he
thinks fit.
10.4 Protection of assets
A Receiver may do all acts as he may think fit which the
Chargor might do in the ordinary conduct of its business
as well for the protection as for the improvement of the
Security Assets.
10.5 Employees
A Receiver may appoint and discharge managers, officers,
agents, accountants, servants, workmen and others for the
purposes of this Deed upon such terms as to remuneration
or otherwise as he may think proper and discharge any
such persons appointed by the Chargor.
10.6 Borrow money
A Receiver may raise and borrow money either unsecured or
on the security of any Security Asset either in priority
to the security constituted by this Deed or otherwise and
generally on any terms and for whatever purpose which he
thinks fit. No person lending that money is concerned to
enquire as to the propriety or purpose of the exercise of
that power or to check the application of any money so
raised or borrowed.
10.7 Sale of assets
A Receiver may sell, exchange, convert into money and
realise any Security Asset by public auction or private
contract and generally in any manner and on any terms
which he thinks proper. The consideration for any such
transaction may consist of cash, debentures or other
obligations, shares, stock or other valuable
consideration and any such consideration may be payable
in a lump sum or by instalments spread over such period
as he thinks fit.
10.8 Compromise
A Receiver may settle, adjust, refer to arbitration,
compromise and arrange any claims, accounts, disputes,
questions and demands with or by any person who is or
claims to be a creditor of the Chargor or relating in any
way to any Security Asset.
10.9 Legal Actions
A Receiver may bring, prosecute, enforce, defend and
abandon all actions, suits and proceedings in relation to
any Security Asset which may seem to him to be expedient.
10.10 Receipts
A Receiver may give valid receipts for all moneys and
execute all assurances and things which may be proper or
desirable for realising any Security Asset.
10.11 Subsidiaries
A Receiver may form a Subsidiary of the Chargor and
transfer to that Subsidiary any Security Asset.
10.12 Delegation
A Receiver may delegate his powers in accordance with
Clause 14 (Delegation).
10.13 Other powers
A Receiver may:-
(a) do all other acts and things which he may consider
desirable or necessary for realising any Security
Asset or incidental or conducive to any of the
rights, powers or discretions conferred on a
Receiver under or by virtue of this Deed; and
(b) exercise in relation to any Security Asset all the
powers, authorities and things which he would be
capable of exercising if he were the absolute
beneficial owner of the same,
and may use the name of the Chargor for any of the above
purposes.
11. SET OFF
The Agent may, at any time after this Deed has become
enforceable, without notice to or making demand on the
Chargor and whether or not all or any of the Secured
Liabilities have matured:
(a) set off any of the Secured Liabilities against any
liability (whether or not matured) owed by the Agent
to the Chargor in respect of any moneys in the
Security Accounts regardless of the place or
payment, booking branch or currency of either
obligation; and/or
(b) debit any account of the Chargor (whether sole or
joint) with the Agent at any of its offices anywhere
(including an account opened specially for that
purpose) with all or any part of the Secured
Liabilities; and/or
(c) apply any moneys in a Security Account in or towards
the payment or discharge of the Secured Liabilities.
12. APPLICATION OF PROCEEDS
Any moneys received by the Agent or any Receiver after
this Deed has become enforceable shall be applied in the
following order of priority (but without prejudice to the
right of any Finance Party to recover any shortfall from
the Chargor):
(a) in satisfaction of or provision for all costs and
expenses incurred by the Agent or any Receiver and
of all remuneration due to the Receiver under this
Deed;
(b) in or towards payment of the Secured Liabilities or
such part of them as is then due and payable; and
(c) in payment of the surplus (if any) to the Chargor or
other person entitled to it.
13. EXPENSES AND INDEMNITY
The Chargor shall forthwith on demand pay all costs and
expenses (including legal fees) incurred in connection
with this Deed by any Finance Party, Receiver, attorney,
manager, agent or other person appointed by the Agent
under this Deed, and keep each of them indemnified
against any failure or delay in paying the same.
14. DELEGATION
The Agent and any Receiver may delegate by power of
attorney or in any other manner to any person any right,
power or discretion exercisable by them under this Deed.
Any such delegation may be made upon the terms (including
power to sub-delegate) and subject to any regulations
which the Agent or that Receiver (as the case may be) may
think fit. Neither the Agent nor any Receiver will be in
any way liable or responsible to the Chargor for any loss
or liability arising from any act, default, omission or
misconduct on the part of any such delegate or sub-
delegate.
15. FURTHER ASSURANCES
The Chargor shall, at its own expense, take whatever
action the Agent or a Receiver may reasonably require
for:-
(a) perfecting or protecting the security intended to be
created by this Deed over any Security Asset;
(b) facilitating the realisation of any Security Asset,
or the exercise of any right, power or discretion
exercisable, by the Agent or any Receiver or any of
its or their delegates or sub-delegates in respect
of any Security Asset,
including the execution of any transfer, conveyance,
assignment or assurance of any property whether to the
Agent or to its nominees, and the giving of any notice,
order or direction and the making of any registration,
which, in any such case, the Agent may think expedient.
16. POWER OF ATTORNEY
The Chargor, by way of security, irrevocably and
severally appoints the Agent, each Receiver and any of
their delegates or sub-delegates to be its attorney to
take any action which the Chargor is obliged to take
under this Deed, including under Clause 15 (Further
Assurances). The Chargor ratifies and confirms whatever
any attorney does or purports to do pursuant to its
appointment under this Clause.
17. MISCELLANEOUS
17.1 Covenant to pay
The Chargor shall pay or discharge the Secured
Liabilities in the manner provided for in the Finance
Documents.
17.2 Continuing security
The security constituted by this Deed is continuing and
will extend to the ultimate balance of all the Secured
Liabilities, regardless of any intermediate payment or
discharge in whole or in part.
17.3 Additional security
The security constituted by this Deed is in addition to
and is not in any way prejudiced by any other security
now or subsequently held by any Finance Party for any
Secured Liability.
17.4 Tacking
Each Bank shall perform its obligations under the Credit
Agreement (including any obligation to make available
further advances).
17.5 New Accounts
If a Finance Party receives, or is deemed to be affected
by, notice, whether actual or constructive, of any
subsequent charge or other interest affecting any
Security Asset and/or the proceeds of sale of any
Security Asset, the Finance Party may open a new account
with the Chargor. If the Finance Party does not open a
new account, it shall nevertheless be treated as if it
had done so at the time when it received or was deemed to
have received notice. As from that time all payments made
to the Finance Party will be credited or be treated as
having been credited to the new account and will not
operate to reduce any amount for which this Deed is
security.
17.6 Time deposits
Without prejudice to any right of set-off any Finance
Party may have under any other Finance Document or
otherwise, if any time deposit matures on any account the
Chargor has with any Finance Party at a time within the
Security Period when:
(a) this security has become enforceable; and
(b) no amount of the Secured Liabilities is due and
payable,
that time deposit shall automatically be renewed for any
further maturity which that Finance Party considers
appropriate.
18. RELEASE
Upon the expiry of the Security Period (but not
otherwise), the Finance Parties shall, at the request and
cost of the Chargor, take whatever action is necessary to
release the Security Assets from the security constituted
by this Deed.
19. GOVERNING LAW
This Deed is governed by English law.
This Deed has been entered into as a deed on the date stated
at the beginning of this Deed.
SCHEDULE 1
Form of notice of the Account Bank
To: [ ]
[ ], 199[ ]
Dear Sirs,
We give you notice that, by a Debenture dated 17th December,
1996, Entergy Power UK PLC charged (by way of a first fixed
and floating charge) to ABN AMRO Bank N.V. (as agent and
trustee) (the "Agent") all moneys (including interest) from
time to time standing to the credit of certain bank accounts
(the "Accounts") and the debt or debts represented thereby.
We irrevocably instruct and authorise you to disclose to the
Agent without any reference to or further authority from us
and without any inquiry by you as to the justification for the
disclosure, any information relating to any of the Accounts
maintained with you from time to time as the Agent may, at any
time and from time to time, request you to disclose to it.
This letter is governed by English law.
Would you please confirm your agreement to the above by
sending the enclosed acknowledgement to the Agent with a copy
to ourselves.
Yours faithfully,
................................
(Authorised signatory)
Entergy Power UK PLC
SCHEDULE 2
Form of acknowledgement of the Account Bank
To: ABN AMRO Bank N.V.
For the attention of: [ ]
[relevant address applying under
Clause 34 (Notices) of the Credit Agreement]
[ ], 199[ ]
Dear Sirs,
We confirm receipt from Entergy Power UK PLC (the "Company")
of a notice dated [ ] of a
charge upon the terms of a Debenture dated 17th December, 1996
of all moneys (including interest) from time to time standing
to the credit of certain bank accounts of the Company (the
"Accounts") and the debt or debts represented thereby.
We confirm that we have not received notice of the interest of
any third party in any of the Accounts maintained with us.
We confirm that until you give us notice in writing that the
assets assigned to you under the Debenture have been released
and reassigned to the Company, we do not have and will not
make or exercise, any claims or demands, any rights of
counterclaim, rights of set-off or any other equities against
the Company in respect of the Accounts maintained with us.
This letter is governed by English law.
Yours faithfully,
.................................
[ ]
SIGNATORIES TO THE DEBENTURE
THE COMMON SEAL of )
ENTERGY POWER UK PLC was )
affixed to this deed in the )
presence of )
Director
Director/Secretary
The Agent
ABN AMRO BANK N.V.
By:
SCHEDULE 8
FORM OF LEGAL OPINIONS OF ALLEN & OVERY
PART I
TO BE DELIVERED BEFORE THE FIRST LOAN
To: The Finance Parties
(as defined in the
Credit Agreement defined below)
Dear Sirs,
Entergy Power UK PLC(the "Company") - 1,250,000,000 pounds Credit
Agreement
dated 17th December, 1996 (the "Credit Agreement")
We have received instructions from and participated in
discussions with the Arrangers in connection with the Credit
Agreement.
Terms defined in the Credit Agreement have the same meaning in
this opinion. The Credit Agreement and the Debenture is each
called an "Agreement". "Security Assets" has, in relation to
the Debenture, the meaning given to it in the Debenture
For the purposes of this opinion we have examined the
following documents:-
(a) a signed copy of the Credit Agreement;
(b) an executed copy of the Debenture dated
[ ] between the Company
and the Agent;
(c) a certified copy of the memorandum and articles of
association and certificate of incorporation of the
Company; and
(d) a certified copy of the minutes of a meeting of the board
of directors of the Company dated [ ].
On [ ] December, 1996, we carried out a search of the
Company at the Companies Registry. On [ ] December,
1996 we made a telephone search of the Company at the winding-
up petitions at the Companies court.
The above are the only documents or records we have examined,
and the only searches and enquiries we have carried out, for
the purposes of this opinion.
We assume that:-
(i) the Company is not unable to pay its debts within the
meaning of section 123 of the Insolvency Act, 1986 at the
time it enters into an Agreement and will not as a
consequence of either Agreement be unable to pay its
debts within the meaning of that section;
(ii) no step has been taken to wind up the Company or appoint
a receiver in respect of it or any of its assets,
although the searches referred to above give no
indication that any winding-up order or appointment of a
receiver has been made;
(iii)all signatures and documents are genuine;
(iv) all documents are and remain up-to-date;
(v) the correct procedure was carried out at the board
meeting referred to in paragraph (d) above; for example,
there was a valid quorum, all relevant interests of
directors were declared and the resolutions were duly
passed at the meeting; and
(vi) each Agreement is a legally binding, valid and
enforceable obligation of each party to it other than the
Company.
Subject to the qualifications set out below and to any matters
not disclosed to us, it is our opinion that, so far as the
present laws of England are concerned:-
(1) Status: The Company is a company incorporated with
limited liability under the laws of England and is not in
liquidation.
(2) Powers and authority: The Company has the corporate power
to enter into and perform the Agreements and has taken
all necessary corporate action to authorise the
execution, delivery and performance of the Agreements.
(3) Legal validity: Each Agreement constitutes the Company's
legally binding, valid and enforceable obligation.
(4) Non-conflict: The execution, delivery and performance by
the Company of each Agreement will not violate any
provision of (i) any existing English law applicable to
companies generally, or (ii) the memorandum or articles
of association of the Company.
(5) Consents: No authorizations of governmental, judicial or
public bodies or authorities in England are required by
the Company in connection with the performance, validity
or enforceability of either Agreement.
(6) Taxes: All payments due from the Company under the Credit
Agreement may be made without deduction of any United
Kingdom taxes, if, in the case of any interest, the
person which made the part of the Loan to which the
interest relates was, at the time of the making of the
Loan, a "bank" as defined in section 840A of the Income
and Corporation Taxes Act 1988 and the recipient of the
interest is within the charge to United Kingdom
corporation tax as regards that interest.
(7) Registration requirements: Except for registration of the
Debenture at Companies House under section 395 of the
Companies Act 1985, it is not necessary or advisable to
file, register or record either Agreement in any public
place or elsewhere in England.
(8) Stamp duties: No stamp, registration or similar tax or
charge is payable in England in respect of either
Agreement.
(9) Security: Subject to due registration where required, the
Debenture creates security interests in the Security
Assets concerned.
This opinion is subject to the following qualifications:-
(i) This opinion is subject to all insolvency and other laws
affecting the rights of creditors or secured creditors
generally.
(ii) No opinion is expressed on matters of fact.
(iii)We assume that no foreign law affects the
conclusions stated above.
(iv) No opinion is expressed as to:
(a) the title of the Company to any Security Asset; or
(b) the priority of any security created or to be
created by the Debenture; or
(c) the nature of the security created by the Debenture
(whether fixed or floating); or
(d) the marketability of, or rights of enforcement over,
the Security Assets.
These matters are too lengthy to cover in this letter.
(v) It may not be possible to create a valid security
interest over a bank account in favour of the bank with
which the account is maintained.
(vi) The term "enforceable" means that a document is of a type
and form enforced by the English courts. It does not
mean that each obligation will be enforced in accordance
with its terms. Certain rights and obligations may be
qualified by the non-conclusivity of certificates,
doctrines of good faith and fair conduct, the
availability of equitable remedies and other matters, but
in our view these qualifications would not defeat your
legitimate expectations in any material respect.
This opinion is given for the sole benefit of the Finance
Parties as at the date of this opinion (and their professional
advisers) and may not be relied upon by or disclosed to any
other person.
Yours faithfully
PART II
TO BE DELIVERED IN RESPECT OF THE TARGET
To: The Finance Parties
(as defined in the
Credit Agreement defined below)
Dear Sirs,
Entergy Power UK PLC (the "Company")/London Electricity plc
(the "Target") - 1,250,000,000 pounds Credit Agreement dated 17th
December, 1996 (the "Credit Agreement")
We have received instructions from and participated in
discussions with the Agent in connection with the Credit
Agreement.
Terms defined in the Credit Agreement have the same meaning in
this opinion.
For the purposes of this opinion we have examined the
following documents:-
(a) a signed copy of the Credit Agreement;
(b) a copy of the Borrower Accession Agreement dated
[ ] and executed by the
Target;
(c) a certified copy of the memorandum and articles of
association and certificate of incorporation of the
Target; and
(d) a certified copy of the minutes of a meeting of the board
of directors of the Target dated [ ].
On [ ], 199[ ], we carried out a
search of the Target at the Companies Registry. On
[ ], 199[ ] we made a telephone
search of the Target at the winding-up petitions at the
Companies court.
The above are the only documents or records we have examined,
and the only searches and enquiries we have carried out, for
the purposes of this opinion.
We assume that:-
(i) no step has been taken to wind up the Target or appoint a
receiver in respect of it or any of its assets, although
the searches referred to above give no indication that
any winding-up order or appointment of a receiver has
been made;
(ii) all signatures and documents are genuine;
(iii)all documents are and remain up-to-date;
(iv) the correct procedure was carried out at the board
meeting referred to in paragraph (d) above: for example,
there was a valid quorum, all relevant interests of
directors were declared and the resolutions were duly
passed at the meeting; and
(v) the Credit Agreement is a legally binding, valid and
enforceable obligation of each party to it.
Subject to the qualifications set out below and to any matters
not disclosed to us, it is our opinion that, so far as the
present laws of England are concerned:-
(1) Status: The Target is a company incorporated with limited
liability under the laws of England and is not in
liquidation.
(2) Powers and authority: The Target has the corporate power
to enter into and perform the Agreements and has taken
all necessary corporate action to authorise the
execution, delivery and performance of the Credit
Agreement.
(3) Legal validity: The Credit Agreement constitutes the
Target's legally binding, valid and enforceable
obligation.
(4) Non-conflict: The execution, delivery and performance by
the Target of the Borrower Accession Agreement and the
Credit Agreement will not violate any provision of
(i) any existing English law applicable to companies
generally, or (ii) the memorandum or articles of
association of the Target.
(5) Consents: No authorizations of governmental, judicial or
public bodies or authorities in England are required by
the Target in connection with the performance, validity
or enforceability of the Borrower Accession Agreement or
the Credit Agreement.
(6) Taxes: All payments due from the Target under the Credit
Agreement may be made without deduction of any United
Kingdom taxes, if, in the case of any interest, the
person which made the part of the Loan to which the
interest relates was, at the time of the making of the
Loan, a "bank" as defined in section 840A of the Income
and Corporation Taxes Act 1988 and the recipient of the
interest is within the charge to United Kingdom
corporation tax as regards that interest.
(7) Registration requirements: It is not necessary or
advisable to file, register or record the Borrower
Accession Agreement in any public place or elsewhere in
England.
(8) Stamp duties: No stamp, registration or similar tax or
charge is payable in England in respect of the Borrower
Accession Agreement.
This opinion is subject to the following qualifications:-
(i) This opinion is subject to all insolvency and other laws
affecting the rights of creditors generally.
(ii) No opinion is expressed on matters of fact.
(iii)We assume that no foreign law affects the conclusions
stated above.
(iv) The term "enforceable" means that a document is of a type
and form enforced by the English courts. It does not
mean that each obligation will be enforced in accordance
with its terms. Certain rights and obligations may be
qualified by the non-conclusivity of certificates,
doctrines of good faith and fair conduct, the
availability of equitable remedies and other matters, but
in our view these qualifications would not defeat your
legitimate expectations in any material respect.
This opinion is given for the sole benefit of the Finance
Parties as at the date of this opinion (and their professional
advisers) and may not be relied upon by or disclosed to any
other person.
Yours faithfully
SCHEDULE 9
FORM OF SUBORDINATION AGREEMENT
DATED [ ] , 199[ ]
BETWEEN
ENTERGY POWER UK PLC
-and-
THE JUNIOR CREDITOR
(as defined in this Deed)
-and-
ABN AMRO BANK N.V.
as Security Agent
_________________________________
SUBORDINATION AGREEMENT
relating to a 1,250,000,000 pounds
credit agreement dated 17th December, 1996
between ENTERGY POWER UK PLC and others
__________________________________
London
TABLE OF CONTENTS
Clause
Page
1. Interpretation 134
2. The Company's undertakings 136
3. Junior Creditor's undertakings 136
4. Turnover of non-permitted recoveries 137
5. Subordination on insolvency 137
6. Consents 138
7. Representations and warranties 138
8. Subrogation by the Junior Creditor 138
9. Protection of subordination 139
10. Preservation of Junior Debt 140
11. Changes to the parties 140
12. Miscellaneous 140
13. Indemnity 141
14. Waivers; remedies cumulative 141
15. Severability 141
16. Governing law 136
Signatories 142
THIS SUBORDINATION AGREEMENT is dated [ ],
1996 between:
(1) [ ] (the
"Junior Creditor");
(2) ENTERGY POWER UK PLC (Registered No. 3261188)(the
"Company"); and
(3) ABN AMRO BANK N.V. (the "Agent") as agent and trustee for
the Finance Parties.
BACKGROUND:
(A) By the Credit Agreement the Banks have agreed to make
available a credit facility of up to 1,250,000,000 pounds
to the Borrowers.
(B) The Junior Creditor has agreed to subordinate all amounts
payable under the Junior Finance Documents on the terms
of this Deed.
(C) It is intended that this document takes effect as a deed
notwithstanding the fact that a party may only execute
this document under hand.
1. INTERPRETATION
1.1 Definitions
In this Deed:
"Credit Agreement"
means the agreement dated 17th December, 1996 between
(among others) the Borrowers and the Agent for a credit
facility of up to 1,250,000,000 pounds.
"Junior Debt"
means all present and future liabilities (actual or
contingent) payable or owing to the Junior Creditor by
the Company under or in connection with the Junior
Finance Documents relating thereto together with:
(a) any permitted novation, deferral or extension of any
of those liabilities;
(b) any further advances which may be made by the Junior
Creditor to the Company under any agreement
expressed to be supplemental to any Junior Finance
Document plus all interest, fees and costs in
connection therewith;
(c) any claim for damages or restitution in the event of
rescission of any of those liabilities or otherwise
in connection with the Junior Finance Documents;
(d) any claim against the Company flowing from any
recovery by the Company of a payment or discharge in
respect of those liabilities on grounds of
preference or otherwise; and
(e) any amounts (such as post-insolvency interest) which
would be included in any of the above for any
discharge, non-provability, unenforceability or non-
allowability of the same in any insolvency or other
proceedings.
"Junior Finance Documents"
means [specify debt document] and all variations,
replacements, novations of and supplements thereto.
"Majority Banks"
has the meaning given to it in the Credit Agreement.
"Senior Debt"
means all present and future liabilities (actual or
contingent) payable or owing by any Borrower to the
Finance Parties under or in connection with the Finance
Documents together with:
(a) any refinancing, novation, refunding, deferral or
extension of any of those liabilities;
(b) any further advances which may be made by the
Finance Parties to any Borrower under any agreement
expressed to be supplemental to any Finance Document
plus all interest, fees and costs in connection
therewith;
(c) any claim for damages or restitution in the event of
rescission of any of those liabilities or otherwise
in connection with the Finance Documents;
(d) any claim against any Borrower flowing from any
recovery by such Borrower of a payment or discharge
in respect of those liabilities on grounds of
preference or otherwise; and
(e) any amounts (such as post-insolvency interest) which
would be included in any of the above for any
discharge, non-provability, unenforceability or
non-allowability of the same in any insolvency or
other proceedings.
"Senior Liabilities"
means all present and future obligations and liabilities
(whether actual or contingent and whether owned jointly
or severally or in any capacity whatsoever) of each
Borrower to any Finance Party under each Finance Document
to which such Borrower is a party.
1.2 Construction
(a) Capitalised terms defined in the Credit Agreement have,
unless expressly defined in this Deed, the same meaning
in this Deed.
(b) The provisions of Clause 1.2 of the Credit Agreement
apply to this Deed as though they were set out in full in
this Deed except that references to the Credit Agreement
are to be construed as references to this Deed.
(c) Any document, instrument or agreement shall be construed
as to include such document, instrument or agreement as
varied, amended, supplemented or novated from time to
time.
2. THE COMPANY'S UNDERTAKINGS
So long as any Senior Debt is outstanding and until the
Senior Liabilities have been irrevocably paid in full,
the Company will not except as permitted under the
Finance Documents (including, without limitation, Clause
19.15 (Distributions)) or except as the Agent, acting on
the instructions of the Majority Banks, has previously
consented:
(a) subject to Clause 5 (Subordination on Insolvency),
pay or repay or purchase or acquire, any of the
Junior Debt; or
(b) discharge any of the Junior Debt by set-off; or
(c) create or permit to subsist security over any of its
assets for any of the Junior Debt; or
(d) amend, vary, waive or release any term of the Junior
Finance Documents (other than any procedural or
administrative change or any other change which can
reasonably be expected not to prejudice any Senior
Debt or any Finance Party); or
(e) take or omit to take any action whereby the
subordination achieved by this Deed will be
impaired.
3. JUNIOR CREDITOR'S UNDERTAKINGS
So long as any Senior Debt is outstanding and until the
Senior Liabilities have been irrevocably paid in full,
except, as permitted under the Finance Documents or
except as the Agent (acting on the instructions of the
Majority Banks) has previously consented, the Junior
Creditor will:
(a) subject to Clause 5 (Subordination on insolvency),
not demand or receive payment of any of the Junior
Debt from the Company or any other source or apply
any money or assets in discharge of any Junior Debt;
(b) not discharge any of the Junior Debt by set-off;
(c) not permit to subsist or receive any security for
any of the Junior Debt;
(d) not permit to subsist or receive any guarantee or
other assurance against loss in respect of any of
the Junior Debt;
(e) not amend, vary, waive or release any term of the
Junior Finance Documents (other than any procedural
or administrative change or any other change which
can reasonably be expected not to prejudice any
Senior Debt or any Finance Party);
(f) promptly notify the Agent of any default or event of
default in respect of the Junior Debt;
(g) unless Clause 5 (Subordination on insolvency)
applies, not:
(i) declare any of the Junior Debt prematurely due
and payable;
(ii) enforce the Junior Debt by execution or
otherwise; or
(iii)initiate or take any steps with a view to any
insolvency, reorganisation or dissolution
proceedings in respect of the Company; and
(h) not take or omit to take any action whereby the
subordination achieved by this Deed may be impaired.
4. TURNOVER OF NON-PERMITTED RECOVERIES
4.1 Non-permitted payment
If, other than as permitted under the Finance Documents:
(a) the Junior Creditor receives a payment or
distribution in respect of any of the Junior Debt
from the Company or any other source; or
(b) the Junior Creditor receives the proceeds of any
enforcement of any security or any guarantee for any
Junior Debt; or
(c) the Company makes any payment or distribution to the
Junior Creditor on account of the purchase or other
acquisition of any of the Junior Debt,
the Junior Creditor will hold the same in trust for the
Finance Parties and pay and distribute it to the Agent
for application towards the Senior Debt until the Senior
Debt is irrevocably paid in full.
4.2 Non-permitted set-offs
If, other than as permitted under the Finance Documents,
for any reason, any of the Junior Debt is discharged by
set-off, the Junior Creditor will promptly pay an amount
equal to the discharge to the Agent for application
towards the Senior Debt until the Senior Debt is
irrevocably paid in full.
4.3 Failure of trust
If, for any reason, a trust in favour of, or a holding of
property for, the Finance Parties under this Deed is
invalid or unenforceable, the Junior Creditor will pay
and deliver to the Agent an amount equal to the payment,
receipt or recovery which the Junior Creditor would
otherwise have been bound to hold on trust for or as
property of the Finance Parties.
5. SUBORDINATION ON INSOLVENCY
If any of the events set out in Clauses 20.6 (Insolvency)
to 20.10 (Analogous proceedings) (inclusive) of the
Credit Agreement occurs THEN
(a) the Junior Debt will be subordinate in right of
payment to the Senior Debt;
(b) the Agent may, and is irrevocably authorised on
behalf of the Junior Creditor to, (i) claim, enforce
and prove for the Junior Debt, (ii) file claims and
proofs, give receipts and take all such proceedings
and do all such things as the Agent reasonably sees
fit to recover the Junior Debt and (iii) receive all
distributions on the Junior Debt for application
towards the Senior Debt;
(c) if and to the extent that the Agent is not entitled
to do any of the foregoing, the Junior Creditor will
do so in good time as reasonably directed by the
Agent;
(d) the Junior Creditor will hold all distributions in
cash or in kind received or receivable by it in
respect of the Junior Debt from the Company or from
any other source in trust for the Finance Parties
and will (at the Junior Creditor's expense) pay and
transfer the same to the Agent for application
towards the Senior Debt until the Senior Debt is
irrevocably paid in full; and
(e) the trustee in bankruptcy, liquidator, assignee or
other person distributing the assets of the Company
or their proceeds is directed to pay distributions
on the Junior Debt direct to the Agent for
application towards the Senior Debt until the Senior
Debt is irrevocably paid in full. The Junior
Creditor will give all such notices and do all such
things as the Agent may reasonably direct to give
effect to this provision.
6. CONSENTS
The Junior Creditor will not have any remedy against the
Company or other Borrower, the Agent or the Finance
Parties by reason of any transaction entered into between
the Agent and/or the Finance Parties and the Company
which violates any Junior Finance Document and the Junior
Creditor may not object to any such transaction by reason
of any provisions of the Junior Finance Documents.
7. REPRESENTATIONS AND WARRANTIES
The Junior Creditor represents and warrants to the Agent
and each Finance Party that this Deed:
(a) is within its powers and has been duly authorised by
it;
(b) constitutes its legal, valid and binding
obligations; and
(c) does not conflict in any material respect with any
law or regulation or its constitutional documents or
any document binding on it and that it has obtained
all necessary consents for its performance of this
Deed.
8. SUBROGATION BY THE JUNIOR CREDITOR
If any of the Senior Debt is wholly or partially paid out
of any proceeds received in respect of or on account of
the Junior Debt, the Junior Creditor will to that extent
be subrogated to the Senior Debt so paid but not before
all the Senior Debt is paid in full.
9. PROTECTION OF SUBORDINATION
9.1 Continuing subordination
The subordination provisions in this Deed constitute a
continuing subordination and benefit the ultimate balance
of the Senior Debt regardless of any intermediate payment
or discharge of the Senior Debt in whole or in part.
9.2 Waiver of defences
The subordination in this Deed and the obligations of the
Junior Creditor under this Deed will not be affected by
any act, omission, matter or thing which, but for this
provision, would reduce, release or prejudice the
subordination or any of those obligations in whole or in
part, including without limitation:
(a) any waiver granted to, or composition with, any
Borrower or other person;
(b) the taking, variation, compromise, exchange, renewal
or release of, or refusal or neglect to perfect,
take up or enforce, any rights against, or security
over assets of, any Borrower or other person in
respect of the Senior Debt or otherwise or any
failure to realise the full value of any security;
(c) any unenforceability, illegality or invalidity of
any obligation of any Borrower or security in
respect of the Senior Debt or any other document or
security.
9.3 Immediate recourse
The Junior Creditor waives any right it may have of first
requiring any Finance Party (or the Agent or any trustee
or other agent on its behalf) to proceed against or
enforce any other rights or security or claim payment
from any person before claiming the benefit of this Deed.
The Agent may refrain from applying or enforcing any
money, rights or security unless and until instructed by
the Majority Banks. The Majority Banks may give or
refrain from giving instructions to the Agent to enforce
or refrain from enforcing any security as long as they
see fit.
9.4 Appropriations
Until the Senior Liabilities have been irrevocably paid
in full, the Agent may:
(a) apply any moneys or property received under this
Deed or from any Borrower or from any other person
against the Senior Debt in accordance with the terms
of the Credit Agreement;
(b) hold in an interest-bearing suspense account any
moneys or distributions received from the Junior
Creditors under Clause 4 (Turnover of non-permitted
recoveries) or Clause 5 (Subordination on
insolvency) or on account of the liability of the
Junior Creditor under this Deed.
9.5 Non-competition
Until the Senior Liabilities have been irrevocably paid
in full, the Junior Creditor will not by virtue of any
payment or performance by them under this Deed or by
virtue of the operation of Clauses 4 (Turnover of non-
permitted recoveries) or 5 (Subordination on insolvency):-
(a) be subrogated to any rights, security or moneys
held, received or receivable by any Finance Party
(or the Agent or any trustee or other agent on its
behalf) or be entitled to any right of contribution
or indemnity in respect of any payment made or
moneys received on account of the Junior Creditor's
liability under this Deed; or
(b) claim, rank, prove or vote as a creditor of any
Borrower or other person or their respective estates
in competition with any Finance Party (or the Agent
or any trustee or other agent on its behalf); or
(c) receive, claim or have the benefit of any payment,
distribution or security from or on account of any
Borrower or other person.
10. PRESERVATION OF JUNIOR DEBT
Notwithstanding any term of this Deed postponing,
subordinating or preventing the payment of any of the
Junior Debt, the Junior Debt concerned shall, solely as
between the Company and the Junior Creditor, remain owing
or due and payable in accordance with the terms of the
Junior Finance Documents, and interest and default
interest will accrue on missed payments accordingly.
11. CHANGES TO THE PARTIES
11.1 Successors and assigns
This Deed is binding on the successors and assigns of the
parties hereto.
11.2 The Company and the Junior Creditor
Neither the Company nor the Junior Creditor may assign or
transfer any of their rights or obligations under this
Deed without the consent of the Majority Banks.
11.3 The Agent and the Finance Parties
The Agent and the Finance Parties may assign or otherwise
dispose of all or any of their rights under this Deed in
accordance with the Senior Finance Documents to which
they are respectively a party.
12. MISCELLANEOUS
12.1 Perpetuity
The perpetuity period for the trusts in this Deed is 80
years.
12.2 Power of attorney
By way of security for the obligations of the Junior
Creditor under this Deed, the Junior Creditor irrevocably
appoints the Agent as its attorney to do anything which
the Junior Creditor is required to do by this Deed but
has failed to do, having been given 10 Business Day's
notice to rectify such non-compliance. The Agent may
delegate this power subject to the approval of the
Majority Banks.
13. INDEMNITY
(a) The Company will indemnify the Agent and every attorney
appointed by it in respect of all liabilities and
expenses reasonably incurred by it or him in good faith
in connection with the enforcement or preservation of any
rights in accordance with this Deed.
(b) The Agent shall not be liable for any losses arising in
connection with the exercise or purported exercise of any
of its rights, powers and discretions in good faith under
this Deed, unless that liability arises as a result of
the Agent's negligence or wilful default and in
particular (but without limitation) the Agent in
possession shall not be liable to account as mortgagee in
possession or for anything except actual receipts.
14. WAIVERS; REMEDIES CUMULATIVE
The rights of the Agent and the Finance Parties under
this Deed:
(a) may be exercised as often as necessary;
(b) are cumulative and are not exclusive of their rights
under the general law; and
(c) may be waived only in writing and specifically and
may be on such terms as the Agent or the Finance
Parties see fit.
15. SEVERABILITY
(a) If a provision of this Deed is or becomes illegal,
invalid or unenforceable in any jurisdiction, that shall
not affect:
(i) the validity or enforceability in that jurisdiction
of any other provision of this Deed; or
(ii) the validity or enforceability in other
jurisdictions of that or any other provision of this
Deed.
(b) This Deed may be executed in any number of counterparts,
all of which, taken together, shall constitute one and
the same instrument and any party may enter into this
Deed by executing a counterpart.
16. GOVERNING LAW
This Deed is governed by and shall be construed in
accordance with English law.
This Deed has been entered into on the date stated at the
beginning of this Deed.
SIGNATORIES TO THE SUBORDINATION AGREEMENT
Senior Creditor
[ ]
By:
Company
ENTERGY POWER UK PLC
By:
Agent
ABN AMRO BANK N.V.
By:
SIGNATORIES
Company
ENTERGY POWER UK PLC
By: LAWRENCE S. FOLKS
Arrangers and Banks
ABN AMRO BANK N.V.
By: C.M. MACDONALD J.P. CLIFFE
BANK OF AMERICA INTERNATIONAL LIMITED
By: WILLIAM M.F. BISHOP
BANK OF AMERICA NATIONAL TRUST AND SAVINGS ASSOCIATION
By: SANJAY GUPTA
UNION BANK OF SWITZERLAND
By: FIONA H. KAPLAN SEAN MALONE
Agent
ABN AMRO BANK N.V.
By: C.M. MACDONALD J.P. CLIFFE
CONFORMED COPY
SUPPLEMENTAL AGREEMENT
DATED 6th February, 1997
relating to a 1,250,000,000 pounds Credit
Agreement dated 17th December, 1996
for
ENTERGY POWER UK PLC
arranged by
ABN AMRO BANK N.V.
BANK OF AMERICA INTERNATIONAL LIMITED
UNION BANK OF SWITZERLAND
with
ABN AMRO BANK N.V.
as Agent
ALLEN & OVERY
London
THIS AGREEMENT is dated 6th February, 1997 between:
(1) ENTERGY POWER UK PLC (Registered No. 3261188) (the
"Company");
(2) ABN AMRO BANK N.V., BANK OF AMERICA INTERNATIONAL LIMITED
and UNION BANK OF SWITZERLAND as arrangers (in this
capacity the "Arrangers");
(3) ABN AMRO BANK N.V., BANK OF AMERICA NATIONAL TRUST AND
SAVINGS ASSOCIATION and UNION BANK OF SWITZERLAND as the
banks party to the Credit Agreement (as defined below) as
at today's date (the "Existing Banks");
(4) THE FINANCIAL INSTITUTIONS listed in Schedule 1 as the
banks who wish to accede to the Credit Agreement as Banks
(the "New Banks"); and
(5) ABN AMRO BANK N.V. as agent (in this capacity the
"Agent").
IT IS AGREED as follows:
1. INTERPRETATION
1.1 Definitions
In this Agreement, unless the contrary intention appears
or the context otherwise requires:
"Credit Agreement"
means the Original Credit Agreement as amended pursuant
to Clause 4 (Nature of this Agreement) of this Agreement.
"Effective Date"
means 6th February, 1997.
"Original Credit Agreement"
means the Credit Agreement dated 17th December, 1996
between the Company, the Arrangers, the Existing Banks
and the Agent.
1.2 Incorporation of Original Credit Agreement
interpretations
(a) Terms defined in the Original Credit Agreement shall,
unless the contrary intention appears or the context
otherwise requires, have the same meaning in this
Agreement.
(b) Clauses 1.2 (Construction), 32 (Severability) and 33
(Counterparts) of the Original Credit Agreement shall
apply to this Agreement, as though they were set out in
full in this Agreement but as if references to the
Original Credit Agreement are to be construed as
references to this Agreement.
2. CONSENT AND CONFIRMATION
(a) The Company, the Arrangers, the Existing Banks and the
Agent each consent to the New Banks becoming Banks and
confirm that, except as expressly provided by the terms
of this Agreement, each of the Finance Documents shall
continue in full force and effect.
(b) It is acknowledged that the Guarantee will not be issued.
3. NOVATION
3.1 Novation of Commitments and related rights and
obligations
On the Effective Date (regardless of whether a Default is
then continuing):
(a) each New Bank will become a Bank under the Credit
Agreement with a Facility A Commitment, Facility B
Commitment and Facility C Commitment as set out
opposite its name in Schedule 2;
(b) each Existing Bank's Facility A Commitment,
Facility B Commitment and Facility C Commitment
shall be and be deemed to be reduced down to, the
respective amounts set out opposite its name in
Schedule 2; and
(c) each New Bank will automatically obtain and assume,
and undertakes to perform, all of the rights and
obligations of a Bank under and in respect of each
of the Finance Documents in respect of the rights
and obligations transferred to it under
paragraphs (a) and (b) above.
3.2 Amounts due on or before the Effective Date
(a) All amounts (if any) payable to an Existing Bank by the
Borrowers on or before the Effective Date (including,
without limitation, all interest and fees payable on the
Effective Date) in respect of any period ending prior to
the Effective Date shall be for the account of the
Existing Banks, and none of the New Banks shall have any
interest in, or any rights in respect of, any such
amounts.
(b) If any Facility A Loan or Facility C Loan falls to be
made on the Effective Date:
(i) the Agent will promptly notify each of the New Banks
of that fact (and the amount of its participation in
that Facility A Loan or Facility C Loan in
accordance with sub-paragraph (ii) below); and
(ii) each Existing Bank and each New Bank shall
participate in that Facility A Loan or Facility C
Loan (subject to the terms of the Credit Agreement)
as if the novation of the Facility A Commitments and
the Facility C Commitments under Clauses 3.1(a) and
(b) (Novation of Commitments and related rights and
obligations) of this Agreement had taken effect
prior to opening of business on the Business Day
before the Effective Date,
and the Company acknowledges that no Existing Bank will
be obliged to participate in any such Loan to any greater
extent.
3.3 Administrative details
Each New Bank has delivered to the Agent its initial
details for the purposes of Clause 34 (Notices) of the
Credit Agreement.
4. NATURE OF THIS AGREEMENT
The novation of Commitments and rights and obligations
contemplated by this Agreement shall take effect (in
accordance with its terms) as a novation so that:
(a) Schedule 2 to this Agreement is substituted for
Schedule 1 to the Credit Agreement on the Effective
Date; and
(b) Clause 28.3 (Procedure for novations) of the Credit
Agreement shall apply to the Commitments, rights and
obligations transferred, assumed and released under
Clause 3.1 (Novation of Commitments and related
rights and obligations) of this Agreement and to the
associated rights and obligations under the Finance
Documents, as if this Agreement were a Novation
Certificate.
5. GOVERNING LAW
This Agreement is governed by English law.
This Agreement has been entered into on the date stated at the
beginning of this Agreement.
SCHEDULE 1
NEW BANKS
The Bank of New York
The Bank of Nova Scotia
The Bank of Tokyo-Mitsubishi, Ltd
Bayerische Landesbank Girozentrale, London Branch
CIBC Wood Gundy plc
Credit Lyonnais
The Dai-Ichi Kangyo Bank, Limited
Den Danske Bank Aktieselskab
The Fuji Bank, Limited
The Industrial Bank of Japan, Limited
Midland Bank PLC
Rabobank, London Branch
The Royal Bank of Scotland plc
The Sanwa Bank, Limited
Societe Generale
The Toronto-Dominion Bank
Union Bank of California, N.A.
Westdeutche Landesbank Girozentrale London Branch
SCHEDULE 2
BANKS AND COMMITMENTS
Banks Facility A Facility B Facility C
Commitment Commitment Commitment
POUNDS POUNDS POUNDS
ABN AMRO Bank N.V. 40,500,000 12,000,000 10,000,000
Bank of America National Trust and 40,500,000 12,000,000 10,000,000
Savings Association
The Bank of New York 40,500,000 12,000,000 10,000,000
The Bank of Nova Scotia 40,500,000 12,000,000 10,000,000
The Bank of Tokyo-Mitsubishi, Ltd 40,500,000 12,000,000 10,000,000
and Union Bank of California, N.A.
Bayerische Landesbank Girozentrale, 40,500,000 12,000,000 10,000,000
London Branch
CIBC Wood Gundy plc 40,500,000 12,000,000 10,000,000
Credit Lyonnais 40,500,000 12,000,000 10,000,000
The Dai-Ichi Kangyo Bank, Limited 40,500,000 12,000,000 10,000,000
Den Danske Bank Aktieselskab 40,500,000 12,000,000 10,000,000
The Fuji Bank, Limited 40,500,000 12,000,000 10,000,000
The Industrial Bank of Japan, Limited 40,500,000 12,000,000 10,000,000
Midland Bank PLC 40,500,000 12,000,000 10,000,000
Rabobank, London Branch 40,500,000 12,000,000 10,000,000
The Royal Bank of Scotland plc 40,500,000 12,000,000 10,000,000
The Sanwa Bank, Limited 40,500,000 12,000,000 10,000,000
Societe Generale 40,500,000 12,000,000 10,000,000
The Toronto-Dominion Bank 40,500,000 12,000,000 10,000,000
Union Bank of Switzerland 40,500,000 12,000,000 10,000,000
Westdeutche Landesbank Girozentrale 40,500,000 12,000,000 10,000,000
London Branch
__________ __________ __________
810,000,000 240,000,000 200,000,000
__________ __________ __________
SIGNATORIES
Company
ENTERGY POWER UK PLC
By: ROBERT J. CUSHMAN
Arrangers and Existing Banks
ABN AMRO BANK N.V.
By: JUSTIN P. CLIFFE
BANK OF AMERICA INTERNATIONAL LIMITED
By: WILLIAM M.F. BISHOP
BANK OF AMERICA NATIONAL TRUST
AND SAVINGS ASSOCIATION
By: SANJAY GUPTA
UNION BANK OF SWITZERLAND
By: FIONA KAPLAN SEAN MALONE
New Banks
THE BANK OF NEW YORK
By: MICHAEL MCMORROW
THE BANK OF NOVA SCOTIA
By: RUSSEL C. HAMER
THE BANK OF TOKYO-MITSUBISHI, LTD
By: DAVID J. DALLISON
BAYERISCHE LANDESBANK GIROZENTRALE, LONDON BRANCH
By: SONKE PETERSEN
CIBC WOOD GUNDY plc
By: SHANNON L. ERNST
CREDIT LYONNAIS
By: MARGARET STEWART
THE DAI-ICHI KANGYO BANK, LIMITED
By: COLIN VITTERY
DEN DANSKE BANK AKTIESELSKAB
By: D. RIMMER
Power of Attorney
THE FUJI BANK, LIMITED
By: RICHARD W. ALLEN
THE INDUSTRIAL BANK OF JAPAN, LIMITED
By: DENIS RAYEL
MIDLAND BANK PLC
By: ANDREW P. SMITH
RABOBANK, LONDON BRANCH
(COOPERATIEVE CENTRALE RAIFFEISEN BOERENLEENBANK BA)
By: PAMELA R. GREEN
THE ROYAL BANK OF SCOTLAND plc
By: C.L. SALTER
THE SANWA BANK, LIMITED
By: P.B. LUCAS
SOCIETE GENERALE
By: MARC BERNARD
THE TORONTO-DOMINION BANK
By: GRAEME FRANCIS
UNION BANK OF CALIFORNIA, N.A.
By: DAVID J. DALLISON
Power of Attorney
WESTDEUTCHE LANDESBANK GIROZENTRALE LONDON BRANCH
By: POLLY ADAMS
Agent
ABN AMRO BANK N.V.
By: D. RIMMER
CONFORMED COPY
SECOND SUPPLEMENTAL AGREEMENT
DATED 18th March, 1997
relating to a 1,250,000,000 Pounds Credit
Agreement dated 17th December, 1996
(as amended by a Supplemental Agreement dated 6th February,
1997)
for
ENTERGY POWER UK PLC
arranged by
ABN AMRO BANK N.V.
BANK OF AMERICA INTERNATIONAL LIMITED
UNION BANK OF SWITZERLAND
with
ABN AMRO BANK N.V.
as Agent
ALLEN & OVERY
London
THIS AGREEMENT is dated 18th March, 1997 between:
(1) ENTERGY POWER UK PLC (Registered No. 3261188) (the
"Company");
(2) ABN AMRO BANK N.V., BANK OF AMERICA INTERNATIONAL LIMITED
and UNION BANK OF SWITZERLAND as arrangers (in this
capacity the "Arrangers");
(3) THE BANKS listed in Schedule 1 as the banks party to the
Credit Agreement (as defined below) as at today's date
(the "Existing Banks");
(4) THE FINANCIAL INSTITUTIONS listed in Schedule 2 as the
banks who wish to accede to the Credit Agreement as Banks
(the "New Banks"); and
(5) ABN AMRO BANK N.V. as agent (in this capacity the
"Agent").
IT IS AGREED as follows:
1. INTERPRETATION
1.1 Definitions
In this Agreement, unless the contrary intention appears
or the context otherwise requires:
"Credit Agreement"
means the Original Credit Agreement as amended pursuant
to Clause 4 (Nature of this Agreement) of this Agreement.
"Effective Date"
means 21st March, 1997.
"Original Credit Agreement"
means the Credit Agreement dated 17th December, 1996
between the Company, the Arrangers, the Existing Banks
and the Agent, as amended by the Supplemental Agreement
dated 6th February, 1997.
1.2 Incorporation of Original Credit Agreement
interpretations
(a) Terms defined in the Original Credit Agreement shall,
unless the contrary intention appears or the context
otherwise requires, have the same meaning in this
Agreement.
(b) Clauses 1.2 (Construction), 32 (Severability) and 33
(Counterparts) of the Original Credit Agreement shall
apply to this Agreement, as though they were set out in
full in this Agreement but as if references to the
Original Credit Agreement are to be construed as
references to this Agreement.
2. CONSENT AND CONFIRMATION
(a) The Company, the Arrangers, the Existing Banks and the
Agent each consent to the New Banks becoming Banks and
confirm that, except as expressly provided by the terms
of this Agreement, each of the Finance Documents shall
continue in full force and effect.
(b) This Agreement is the Syndication Agreement.
3. NOVATION
3.1 Novation of Commitments and related rights and
obligations
On the Effective Date (regardless of whether a Default is
then continuing):
(a) each New Bank will become a Bank under the Credit
Agreement with a Facility A Commitment, Facility B
Commitment and Facility C Commitment as set out
opposite its name in Schedule 3;
(b) each Existing Bank's Facility A Commitment,
Facility B Commitment and Facility C Commitment
shall be and be deemed to be reduced down to, the
respective amounts set out opposite its name in
Schedule 3; and
(c) each New Bank will automatically obtain and assume,
and undertakes to perform, all of the rights and
obligations of a Bank under and in respect of each
of the Finance Documents in respect of the rights
and obligations transferred to it under
paragraphs (a) and (b) above, including, without
limitation, its corresponding proportion of the
rights and obligations of the Existing Banks in
respect of the current Facility B Loan.
3.2 Amounts due on or before the Effective Date
(a) All amounts (if any) payable to an Existing Bank by the
Borrowers on or before the Effective Date (including,
without limitation, all interest and fees payable on the
Effective Date) in respect of any period ending prior to
the Effective Date shall be for the account of the
Existing Banks, and none of the New Banks shall have any
interest in, or any rights in respect of, any such
amounts.
(b) If any Facility A Loan or Facility C Loan falls to be
made on the Effective Date:
(i) the Agent will promptly notify each of the New Banks
of that fact (and the amount of its participation in
that Facility A Loan or Facility C Loan in
accordance with sub-paragraph (ii) below); and
(ii) each Existing Bank and each New Bank shall
participate in that Facility A Loan or Facility C
Loan (subject to the terms of the Credit Agreement)
as if the novation of the Facility A Commitments and
the Facility C Commitments under Clauses 3.1(a) and
(b) (Novation of Commitments and related rights and
obligations) of this Agreement had taken effect
prior to opening of business on the Business Day
before the Effective Date,
and the Company acknowledges that no Existing Bank will
be obliged to participate in any such Loan to any greater
extent.
(c) On the Effective Date each New Bank shall pay to the
Agent for the Existing Banks pro rata an amount
equal to the principal amount of the Facility B Loan
assumed by it under Clause 3.1(c) (Novation of
Commitments and related rights and obligations) of
this Agreement.
3.3 Administrative details
Each New Bank has delivered to the Agent its initial
details for the purposes of Clause 34 (Notices) of the
Credit Agreement.
4. NATURE OF THIS AGREEMENT
The novation of Commitments and rights and obligations
contemplated by this Agreement shall take effect (in
accordance with its terms) as a novation so that:
(a) Schedule 3 to this Agreement is substituted for
Schedule 1 to the Credit Agreement on the Effective
Date; and
(b) Clause 28.3 (Procedure for novations) of the Credit
Agreement shall apply to the Commitments, rights and
obligations transferred, assumed and released under
Clause 3.1 (Novation of Commitments and related
rights and obligations) of this Agreement and to the
associated rights and obligations under the Finance
Documents, as if this Agreement were a Novation
Certificate.
5. GOVERNING LAW
This Agreement is governed by English law.
This Agreement has been entered into on the date stated at the
beginning of this Agreement.
SCHEDULE 1
EXISTING BANKS
ABN AMRO Bank N.V.
Bank of America National Trust and Savings Association
The Bank of New York
The Bank of Nova Scotia
The Bank of Tokyo-Mitsubishi, Ltd
Bayerische Landesbank Girozentrale, London Branch
CIBC Wood Gundy plc
Credit Lyonnais
The Dai-Ichi Kangyo Bank, Limited
Den Danske Bank Aktieselskab
The Fuji Bank, Limited
The Industrial Bank of Japan, Limited
Midland Bank PLC
Rabobank, London Branch
The Royal Bank of Scotland plc
The Sanwa Bank, Limited
Societe Generale
The Toronto-Dominion Bank
Union Bank of California, N.A.
Union Bank of Switzerland
Westdeutsche Landesbank Girozentrale London Branch
SCHEDULE 2
NEW BANKS
Bayerische Hypotheken- und Wechsel-Bank AG, London Branch
Barclays Bank PLC
Commonwealth Bank of Australia
Deutsche Bank AG London
Dresdner Bank AG London Branch
Kredietbank NV (London Branch)
National Westminster Bank Plc
The Nikko Bank (UK) plc
The Sakura Bank, Limited
The Sumitomo Bank, Limited
SCHEDULE 3
BANKS AND COMMITMENTS
Banks Facility A Facility B Facility C
Commitment Commitment Commitment
POUNDS POUNDS POUNDS
ABN AMRO Bank N.V. 32,400,000 9,600,000 8,000,000
Bank of America National Trust and
Savings Association 32,400,000 9,600,000 8,000,000
The Bank of New York 32,400,000 9,600,000 8,000,000
The Bank of Tokyo-Mitsubishi, Ltd and
Union Bank of California, N.A. 32,400,000 9,600,000 8,000,000
Bayerische Landesbank Girozentrale,
London Branch 32,400,000 9,600,000 8,000,000
CIBC Wood Gundy plc 32,400,000 9,600,000 8,000,000
The Dai-Ichi Kangyo Bank, Limited 32,400,000 9,600,000 8,000,000
Den Danske Bank Aktieselskab 32,400,000 9,600,000 8,000,000
The Industrial Bank of Japan, Limited 32,400,000 9,600,000 8,000,000
Midland Bank PLC 32,400,000 9,600,000 8,000,000
Rabobank, London Branch 32,400,000 9,600,000 8,000,000
The Royal Bank of Scotland plc 32,400,000 9,600,000 8,000,000
The Sanwa Bank, Limited 32,400,000 9,600,000 8,000,000
Union Bank of Switzerland 32,400,000 9,600,000 8,000,000
Westdeutsche Landesbank Girozentrale
London Branch 32,400,000 9,600,000 8,000,000
The Toronto-Dominion Bank 29,160,000 8,640,000 7,200,000
The Bank of Nova Scotia 25,920,000 7,680,000 6,400,000
Credit Lyonnais 25,920,000 7,680,000 6,400,000
Societe Generale 25,920,000 7,680,000 6,400,000
The Fuji Bank, Limited 22,680,000 6,720,000 5,600,000
Bayerische Hypotheken- und Wechsel-
Bank AG, London Branch 19,440,000 5,760,000 4,800,000
Barclays Bank PLC 19,440,000 5,760,000 4,800,000
Commonwealth Bank of Australia 19,440,000 5,760,000 4,800,000
Deutsche Bank AG London 19,440,000 5,760,000 4,800,000
Dresdner Bank AG London Branch 19,440,000 5,760,000 4,800,000
Kredietbank NV (London Branch) 19,440,000 5,760,000 4,800,000
National Westminster Bank Plc 19,440,000 5,760,000 4,800,000
The Nikko Bank (UK) plc 19,440,000 5,760,000 4,800,000
The Sakura Bank, Limited 19,440,000 5,760,000 4,800,000
The Sumitomo Bank, Limited 19,440,000 5,760,000 4,800,000
__________ __________ __________
810,000,000 240,000,000 200,000,000
__________ __________ __________
SIGNATORIES
Company
ENTERGY POWER UK PLC
By: WILLIAM J. REGAN, JR.
Arrangers and Existing Banks
ABN AMRO BANK N.V.
By: J.P. CLIFFE
BANK OF AMERICA INTERNATIONAL LIMITED
By: WILLIAM M.F. BISHOP
BANK OF AMERICA NATIONAL TRUST
AND SAVINGS ASSOCIATION
By: WILLIAM M.F. BISHOP
UNION BANK OF SWITZERLAND
By: N. BURNHAM
Existing Banks
THE BANK OF NEW YORK
By: MICHAEL McMORROW
THE BANK OF NOVA SCOTIA
By: RUSSEL C. HAMER
THE BANK OF TOKYO-MITSUBISHI, LTD
By: DAVID J. DALLISON
Existing Banks (Cont.)
BAYERISCHE LANDESBANK GIROZENTRALE, LONDON BRANCH
By: MIRIAM SCUKA
CIBC WOOD GUNDY plc
By: D. RIMMER (Power of Attorney)
CREDIT LYONNAIS
By: M. STEWART
THE DAI-ICHI KANGYO BANK, LIMITED
By: D. RIMMER (Power of Attorney)
DEN DANSKE BANK AKTIESELSKAB
By: D. RIMMER (Power of Attorney)
THE FUJI BANK, LIMITED
By: P. RICHEY
THE INDUSTRIAL BANK OF JAPAN, LIMITED
By: ROGER CONCIN
MIDLAND BANK PLC
By: A.P. SMITH
RABOBANK, LONDON BRANCH
(COOPERATIEVE CENTRALE RAIFFEISEN BOERENLEENBANK BA)
By: D. RAWSON PAMELA R. GREEN
Existing Banks (Cont.)
THE ROYAL BANK OF SCOTLAND plc
By: D. RIMMER (Power of Attorney)
THE SANWA BANK, LIMITED
By: M.J. CURRAN
SOCIETE GENERALE
By: P. FOWLER
THE TORONTO-DOMINION BANK
By: D. RIMMER (Power of Attorney)
UNION BANK OF CALIFORNIA, N.A.
By: DAVID J. DALLISON
WESTDEUTSCHE LANDESBANK GIROZENTRALE LONDON BRANCH
By: RHODERICK HENDERSON
New Banks
BAYERISCHE HYPOTHEKEN- UND WECHSEL-BANK AG,
LONDON BRANCH
By: JONATHAN BULLOCK TREVOR PRITCHARD
BARCLAYS BANK PLC
By: DAVID ALLEN
COMMONWEALTH BANK OF AUSTRALIA
By: B. PARKER
DEUTSCHE BANK AG LONDON
By: G. RUTTER D. BUGGE
DRESDNER BANK AG LONDON BRANCH
By: H. WOOLDRIDGE D. BARNES
KREDIETBANK NV (LONDON BRANCH)
By: N. VAN DOREN
NATIONAL WESTMINSTER BANK Plc
By: J.P. KASPEREK
THE NIKKO BANK (UK) plc
By: J.B. SMITH M. MOSELING
THE SAKURA BANK, LIMITED
By: K. ONOE M. GILLARD
THE SUMITOMO BANK, LIMITED
By: D. RIMMER (Power of Attorney)
Agent
ABN AMRO BANK N.V.
By: D. RIMMER
CONFORMED COPY
THIRD SUPPLEMENTAL AGREEMENT
DATED 30th June, 1997
relating to a 1,250,000,000 Pounds Credit Agreement dated 17th
December, 1996
(as amended by a Supplemental Agreement dated 6th February, 1997
and a Second Supplemental Agreement dated 18th March, 1997)
for
ENTERGY POWER UK PLC
arranged by
ABN AMRO BANK N.V.
BANK OF AMERICA INTERNATIONAL LIMITED
UNION BANK OF SWITZERLAND
with
ABN AMRO BANK N.V.
as Agent
ALLEN & OVERY
London
THIS AGREEMENT is dated 30th June, 1997 between:
(1) ENTERGY POWER UK PLC (Registered No. 3261188) (the
"Company");
(2) ABN AMRO BANK N.V., BANK OF AMERICA INTERNATIONAL LIMITED
and UNION BANK OF SWITZERLAND as arrangers (in this capacity
the "Arrangers"); and
(3) ABN AMRO BANK N.V. as agent for the Banks party to the
Original Credit Agreement (in this capacity the "Agent").
IT IS AGREED as follows:
1. INTERPRETATION
1.1 Definitions
In this Agreement, unless the contrary intention appears or
the context otherwise requires:
"Credit Agreement"
means the Original Credit Agreement as amended pursuant to
Clause 2 (Amendments to the Original Credit Agreement) of
this Agreement.
"Original Credit Agreement"
means the Credit Agreement dated 17th December, 1996 between
the Company, the Arrangers, the Existing Banks and the
Agent, as amended by the Supplemental Agreement dated 6th
February, 1997 and a Second Supplemental Agreement dated
18th March, 1997.
1.2 Incorporation of Original Credit Agreement interpretations
(a) Terms defined in the Original Credit Agreement shall, unless
the contrary intention appears or the context otherwise
requires, have the same meaning in this Agreement.
(b) Clauses 1.2 (Construction), 27 (Amendments and waivers), 32
(Severability) and 33 (Counterparts) of the Original Credit
Agreement shall apply to this Agreement, as though they were
set out in full in this Agreement but as if references to
the Original Credit Agreement are to be construed as
references to this Agreement.
2. AMENDMENTS TO THE ORIGINAL CREDIT AGREEMENT
The Company has requested that the Finance Parties agree to
the following amendments which differ from the arrangments
contemplated by the Original Credit Agreement as follows:-
(a) Clause 18.16 (Times for making representations and
warranties): the words "(with the exception of Clause
18.11 (Information memorandum)" shall be added after
the words "in the case of the Target," in sub-paragraph
(ii) of paragraph (a) of Clause 18.16 (Times for making
representations and warranties);
(b) Clause 19.16 (Lending and borrowing):
(i) sub-paragraph (iv) of paragraph (b) of Clause
19.16 (Lending and borrowing) shall be renumbered
sub-paragraph "(v)" and a new paragraph (iv) shall
be added into as follows:-
"(iv) cash deposits made by a member of the
Group at a bank or other financial
institution; or"; and
(ii) the reference to "(iii)" in the new sub-paragraph
(v) shall be deleted and replaced by "(iv)"; and
(c) Clause 19.28 (Financial covenants): a new paragraph
(vi) and a new paragraph (vii) shall be added into the
definition of "Adjusted Capital and Reserves" in Clause
19.28 (Financial covenants) as follows:-
"(vi) plus any amount deducted from reserves or the
profit and loss account in respect of goodwill
arising upon and in respect of the acquisition of
the Shares;
(vii) plus any amount deducted from reserves or the
profit and loss account as a provision for the
future payment of any exceptional, special or
windfall tax or levy applicable to, inter alia,
privatised regional electricity companies as a
whole;;".
3. REPRESENTATIONS AND WARRANTIES
The Company represents and warrants to each Finance Party
that the representations and warranties to be repeated by
the Company in accordance with Clause 18.16 (b) (Times for
making representations and warranties) of the Original
Credit Agreement are true as if made on the date of this
Agreement and as if references to the Original Credit
Agreement were references to this Agreement.
4. AGREEMENT TO AMENDMENTS TO THE ORIGINAL CREDIT AGREEMENT
Subject to Clauses 3 (Representations and warranties) above,
each of the parties and the Agent on behalf of the Banks, by
its execution of this Agreement, consents to the
arrangements set out in Clause 2 (Amendments to the Original
Credit Agreement) above and agrees that the Original Credit
Agreement shall be amended, with effect from the date of
this Agreement, in order to enable such arrangements to be
effected, to the intent that any carrying out of any such
arrangements shall not constitute a breach of or Default
under the Original Credit Agreement or any other Finance
Document.
5. INCORPORATION
(a) This Agreement is a Finance Document.
(b) This Agreement shall be deemed to be incorporated as part of
the Original Credit Agreement.
(c) Except as otherwise provided in this Agreement, the Finance
Documents remain in full force and effect.
6. GOVERNING LAW
This Agreement is governed by English law.
This Agreement has been entered into on the date stated at the
beginning of this Agreement.
SIGNATORIES
Company
ENTERGY POWER UK PLC
By: MICHAEL BEMIS
Arrangers
ABN AMRO BANK N.V.
By: DUNCAN BAILEY KARL PAGE
BANK OF AMERICA INTERNATIONAL LIMITED
By: JOHN LAVERY
UNION BANK OF SWITZERLAND
By: SEAN MALONE NICK BURNHAM
Agent
ABN AMRO BANK N.V.
By: DUNCAN BAILEY KARL PAGE