EXHIBIT 10.9
NEWBRIDGE NETWORKS CORPORATION
Indicative Summary of Terms and Conditions
C$50,000,000 Loan Facility
Borrower: Newbridge Networks Corporation (the "Borrower").
Facility Amount: C$50,000,000 consisting of two parts:
1. A fixed rate accreting Term Loan which is secured and non-
recourse.
2. A floating rate amortizing Demand Loan which is unsecured.
Schedule of
Principal Owing: The principal amounts owing shall be as follows, absent any
early repayments [all to be updated and fully detailed once
exact figures and dates are known]:
From: To: Term Loan Demand Loan
26-Jan-98 25-Jul-98 34,512,500 15,487,500
26-Jul-98 25-Jan-99 35,092,410 14,907,590
26-Jan-99 25-Jul-99 35,770,324 14,229,676
26-Jul-99 25-Jan-2000 36,521,362 13,478,638
26-Jan-2000 25-Jul-2000 37,330,610 12,669,390
26-Jul-2000 25-Jan-2001 38,166,837 11,833,163
26-Jan-2001 25-Jul-2001 39,089,514 10,910,486
26-Jul-2001 25-Jan-2002 40,021,072 9,978,928
26-Jan-2002 25-Jul-2002 40,967,811 9,032,189
26-Jul-2002 25-Jan-2003 41,936,021 8,063,979
26-Jan-2003 42,923,769 7,076,231
Purpose: General corporate purposes.
Security: Lender recourse and Borrower obligations on the Term Loan are
limited to the specific Security provided.
Security for the Term Loan will be 545,976 Northern Telecom
Limited (Nortel) common shares placed in Trust with Trustee
(or cash equivalent) to serve the Borrower's obligations to
Lender under the loan. Additional Security will be the
Borrower's rights under a related Forward Share Price Hedge
Agreement (see attached Term Sheet). The Demand Loan will be
unsecured, and will be direct recourse to the Borrower.
Trustee: [To be determined]
Administrative
Agent: Citibank Canada ("Citibank").
Arranger: Citibank.
Lender: Citibank.
Funding Date: January [26], 1998, or such other date as may be agreed upon
by the Borrower and the Lender.
Facility Term of five (5) years from the Funding Date.
Termination Date:
Fees: Zero upfront fees.
Zero ongoing fees.
Interest Rates: On the Term Loan: [6.17%] annual rate, paid semi-annually in
arrears.
During the 5 year term, the Term Loan can be repaid at any
time and/or can be permanently reduced in size (with make
whole language based on discounting the cashflows remaining at
BA + 0),
On the Demand Loan: [1 mth BA + 0, mthly].
Loan
Documentation: The provision of the Facility is subject to preparation,
execution and delivery of mutually acceptable loan
documentation which will contain conditions precedent,
representations and warranties, events of default and other
provisions customary for facilities of this nature, including,
but not limited to, those noted below.
Conditions
Precedent: (i) No material adverse change prior to closing or to the
making of any advance, (ii) Security for the Term Loan
deposited in Trust in advance of a draw down on the facility.
Security must be free of all liens, claims, encumbrances or
prior charges and shall constitute a first ranking claim on
such assets, (iii) and as the Borrower's rights under the
related Forward Share Price Hedge Agreement represents a
portion of the Security for the Term Loan, this Forward Share
Price Hedge Agreement must remain in place over the life of
the Term Loan.
Representation Standard representations and warranties including no material
and Warranties: adverse change prior to closing.
Assignment and The Lender will have the right to assign all or a portion of
Participations: its rights and obligations under the loan documents, with the
consent, not to be unreasonably withheld, of the Borrower.
The Lender will also have the right, without consent of the
Borrower to assign, with notice, to the Borrower, all or part
of its rights or obligations under the loan documents to any
of its affiliates.
The Lender will have the right to sell participations in its
rights and obligations under the loan documents, subject to
customary restrictions on the participants' voting rights.
Governing Law: The Loan Agreement and the Security Agreement shall be
governed by and construed in accordance with the laws of the
Province of Ontario. There should be submission to Ontario
jurisdiction.
Additional Any term or condition not addressed specifically herein
Matters: shall be subject to the mutual agreement of the respective
parties.
This Indicative Summary of Terms is not a commitment of Citibank or any of its
affiliates or subsidiaries and is intended for discussion purposes only.
This document is, however, intended to act as a guideline of key trade
parameters. Subject to adjustment of prices based on market conditions, this
summary of terms and conditions should be considered the basis for any verbal
agreement, and as a basis for the official legal documents to follow.
/s/ Ammar Al-Joundi January 20/98
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Ammar Al-Joundi (Date)
Vice-President
Citibank Canada
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/s/ Ken Bellows January 20/98
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Ken Bellows (Date)
Assistant Vice-President
Newbridge Networks Corporation