EXHIBIT 10.3
NTL COMMUNICATIONS CORP.
(to be renamed NTL INCORPORATED on the Plan Effective Date)
as New NTL
COMMUNICATIONS CABLE FUNDING CORP.
as Parent
NTL (UK) GROUP, INC.
as Intermediate Parent
NTL COMMUNICATIONS LIMITED
as Borrower
MORGAN STANLEY DEAN WITTER BANK LIMITED
AND J.P. MORGAN PLC (formerly known as Chase Manhattan plc)
as Arrangers and Joint Book Managers
and
J.P. MORGAN EUROPE LIMITED
(formerly known as Chase Manhattan International Limited)
as Agent and Security Trustee
and
OTHERS
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AMENDED AND RESTATED CREDIT AGREEMENT (originally for
(pound)1,300,000,000)
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[GRAPHIC OMITTED][GRAPHIC OMITTED]
7-11 Moorgate
London EC2R 6HH
THIS AGREEMENT is made on 30 May 2000 and amended and restated
pursuant to the Restatement Amendment Agreement dated [ ]
BETWEEN:
(1) NTL COMMUNICATIONS CORP. (to be renamed NTL Incorporated on the Plan
Effective Date), a company incorporated in Delaware ("New NTL");
(2) COMMUNICATIONS CABLE FUNDING CORP., a company incorporated in
Delaware (the "Parent");
(3) NTL (UK) GROUP, INC., a company incorporated in Delaware (the
"Intermediate Parent");
(4) NTL COMMUNICATIONS LIMITED, a company incorporated in England and
Wales with company number 3521915 (the "Borrower");
(5) MORGAN STANLEY DEAN WITTER BANK LIMITED and J.P. MORGAN PLC (formerly
known as Chase Manhattan plc) as arrangers and joint book managers of
the Facility (the "Arrangers");
(6) J.P. MORGAN EUROPE LIMITED (formerly known as Chase Manhattan
International Limited) as agent for the Banks (the "Agent");
(7) J.P. MORGAN EUROPE LIMITED (formerly known as Chase Manhattan
International Limited) as security trustee for the Finance Parties
(the "Security Trustee"); and
(8) THE BANKS (as defined below).
IT IS AGREED as follows:
1. DEFINITIONS AND INTERPRETATION
1.1 Definitions
In this Agreement:
"Acquisition" means the acquisition by Euroco of the issued share
capital of CWC Holdings pursuant to the Transaction Agreement.
"Advance" means an advance (as from time to time consolidated,
divided or reduced by repayment in accordance with the terms hereof)
made or to be made by the Banks under the Facility.
"Affiliate Transaction" means any transaction between the
Intermediate Parent or a member of the UK Group and an affiliate
thereof of a type referred to at paragraphs (a) to (m) of sub-clause
18.26.1 of Clause 18.26 (Transactions with Affiliates).
"Applicable High Yield Index" means
(a) the index of securities issued by US cable television
companies included in the Deutsche Bank Global High Yield
Index; or
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(b) if the index referred to at paragraph (a) above does not
exist at any relevant time, the index of securities issued
by US cable television companies included in the CSFB High
Yield Index; or
(c) if the index referred to at paragraph (a) above and the
index referred to at paragraph (b) above do not exist at any
relevant time, such other publicly available index which
would most closely resemble the index referred to at
paragraph (b) above had it continued to exist as may be
agreed between the Agent (acting on the instructions of an
Instructing Group) and New NTL (in each case acting
reasonably) provided that until any such agreement the index
referred to at paragraph (b) above in the form immediately
prior to it ceasing to exist shall be used.
"Asset Adjustment Payments" means:
(a) a payment made by a member of the UK Group to a company
carrying on the CWC DataCo Business, in respect of a
transfer of assets from that company carrying on the CWC
DataCo Business to such a member of the UK Group where (i)
such payment by the member of the UK Group is in cash and in
an amount equal to the full market value (including any
amount in respect of VAT) of the relevant assets transferred
and (ii) Cable & Wireless is obliged under the Transaction
Agreement to reimburse the member of the UK Group in respect
of such payment; or
(b) a payment made by a company carrying on the CWC DataCo
Business to a member of the UK Group, in respect of a
transfer of assets from such a member of the UK Group to
that company carrying on the CWC DataCo Business where (i)
such payment by the company carrying on the CWC DataCo
Business is in cash and in an amount equal to the full
market value (including any amount in respect of VAT) of the
relevant assets transferred and (ii) New NTL is obliged to
reimburse or, if not so obliged reimburses, the company
carrying on the CWC DataCo Business in respect of such
payment; or
(c) a payment made by a member of the UK Group to a company
carrying on the CWC DataCo Business, in respect of a
transfer of assets from that company carrying on the CWC
DataCo Business to such member of the UK Group where (i)
such payment by the member of the UK Group is in cash and in
an amount equal to the VAT chargeable on the supply
constituted by the transfer of the relevant assets to the
member of the UK Group and (ii) Cable & Wireless is obliged
under the Transaction Agreement to pay to the company
carrying on the CWC DataCo Business an amount equal to the
full market value (exclusive of any amount in respect of
VAT) of the relevant asset transferred; or
(d) a payment made by a company carrying on the CWC DataCo
Business to a member of the UK Group, in respect of a
transfer of assets from such a member of the UK Group to
that company carrying on the CWC DataCo Business where (i)
such payment by the company carrying on the CWC DataCo
Business is in cash and in an amount equal to the VAT
chargeable on the supply constituted by the transfer of the
relevant assets to the company carrying on the CWC DataCo
Business and (ii) New NTL is obliged to pay or,
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if not so obliged, pays to the member of the UK Group an
amount equal to the full market value (exclusive of any amount
in respect of VAT) of the relevant asset transferred,
in the case of paragraph (a) above, in accordance with the terms of
the Transaction Agreement and, in the case of each of paragraphs (b),
(c) and (d) above, until such time as the rights, benefits and
obligations of Euroco under the Transaction Agreement in respect of
Asset Adjustment Payments have been transferred to New NTL in
accordance with the Asset Adjustment Payments Memorandum and at any
time after such transfer, in accordance with the Transaction
Agreement.
"Asset Adjustment Payments Memorandum" means the memorandum relating
to Asset Adjustment Payments certified by an Authorised Signatory of
the Borrower and delivered to the Agent as a condition precedent to
the Restatement Amendment Effective Date.
"Asset Passthrough" means a series of transactions (insofar as it
affects the Covenant Group), commencing with a transaction between
the Parent and a member of the Covenant Group, which may be followed
by one or more similar transactions between various members of the
Covenant Group and culminating with a similar transaction between a
member of the Covenant Group and a Final Asset Transferee, the
purpose of which is to enable the Parent to indirectly transfer
assets (other than cash) to that Final Asset Transferee by way of
transfers of those assets to and from (and, if necessary, between)
one or more members of the Covenant Group in such a manner as to be
neutral to the Covenant Group taken as a whole, provided that:
(a) the consideration payable (if any) by the first member of
the Covenant Group to acquire such assets to the Parent
comprises either (i) cash funded or to be funded directly or
indirectly by a payment from the Final Asset Transferee in
connection with that series of transactions or (ii)
Subordinated Funding;
(b) if the Intermediate Parent (having acquired such assets from
the Parent) transfers them on to another member of the
Covenant Group, the consideration payable by such a member
of the Covenant Group comprises either (i) cash funded or to
be funded directly or indirectly by a payment from the Final
Asset Transferee in connection with that series of
transactions or (ii) Parent Funding;
(c) the consideration payable by the Final Asset Transferee is
equal to the consideration received or receivable by the
Parent;
(d) the consideration payable by each member of the Covenant
Group participating in such a series of transactions is
equal in value;
(e) all of the transactions comprising such a series of
transactions (from and including the transfer of the assets
by the Parent to and including the acquisition of those
assets by the Final Asset Transferee) are completed within
two Business Days; and
(f) upon completion of all of the transactions comprising such a
series of transactions, no person (other than another member
of the Covenant Group) has any recourse to any member of the
Covenant Group in relation to such a
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series of transactions (other than in respect of (i) the
Subordinated Funding mentioned in paragraph (a) above) and
(ii) covenants as to title provided in favour of the Final
Asset Transferee on the same terms as such covenants were
provided in favour of the Parent in respect of the relevant
assets.
"Assigned Debt" means:
(a) any loan made by the Parent to the Intermediate Parent where
the Parent's rights in respect of any such loan have been
assigned to the Security Trustee pursuant to the Parent
Inter-Company Loan Assignment; and
(b) any loan made by the Intermediate Parent to the Borrower
where the Intermediate Parent's rights in respect of such
loan have been assigned pursuant to the Intermediate Parent
Inter-Company Loan Assignment.
"Authorised Signatory" means, in relation to an Obligor, any person
who is duly authorised (in such manner as may be reasonably
acceptable to the Agent) and in respect of whom the Agent has
received a certificate signed by a director or another Authorised
Signatory of such Obligor setting out the name and signature of such
person and confirming such person's authority to act.
"Available Commitment" means, in relation to a Bank at any time and
save as otherwise provided herein, its Commitment at such time less
the aggregate amount which it has advanced hereunder at such time
(but not including any amount added to the Advances pursuant to
Clause 4.3 (Limitations on Cash Interest)), provided that such amount
shall not be less than zero.
"Available Facility" means, at any time, the aggregate amount of the
Available Commitments adjusted, in the case of any proposed drawdown,
so as to take into account any cancellation or reduction in the
Available Commitment of a Bank pursuant to the terms hereof.
"Average Revenue Contributions" means, in respect of any asset at any
time:
A + B
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where:
A= the revenue generated by, or attributable (whether in
whole or in part) to, such asset during the immediately
preceding financial year of the Borrower, expressed as a
percentage of the aggregate of the consolidated revenue of
the UK Group for such a financial year and, to the extent
that the Target Group was not part of the UK Group for any
part of such financial year, a determination by the Borrower
of the amount of the consolidated revenue of the Target
Group for the part of such financial year for which the
Target Group was not part of the UK Group; and
B= the revenue generated by, or attributable (whether in
whole or in part) to, such asset during the financial year
of the Borrower preceding that referred to in A above,
expressed as a percentage of the aggregate of the
consolidated revenue of the UK Group for such financial year
and, to the extent that the Target
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Group was not part of the UK Group for any part of such
financial year, a determination by the Borrower of the
amount of the consolidated revenue of the Target Group for
the part of such financial year for which the Target Group
was not part of the UK Group.
"Bank" means any financial institution:
(a) named in Schedule 1 (The Banks); or
(b) which has become a party hereto as a Bank in accordance with
Clause 30.4 (Assignments by Banks) or Clause 30.5 (Transfers
by Banks),
and which has not ceased to be a party hereto in accordance with the
terms hereof.
"Bankruptcy Court" means the United States Bankruptcy Court for the
Southern District of New York.
"Budget" means a budget delivered by the Borrower to the Agent
pursuant to Clause 16.6 (Budgets).
"Business Day" means a day (other than a Saturday or Sunday) which is
not a public holiday and on which banks are open for general business
in both London and New York.
"Cable & Wireless" means Cable & Wireless plc, a company incorporated
in England and Wales (company number 238525).
"Cable Business" means (i) the business of directly or indirectly
operating, or owning a license to operate, a cable and/or television
and/or telephone and/or telecommunications system or service
principally within the United Kingdom and/or in Ireland and (ii) any
Cable Related Business.
"Cable Related Business" means a business which directly, or
indirectly, owns or provides a service or product used in a Cable
Business, including, without limitation, any television programming,
production and/or licensing business or any programming guide or
telephone directory business or content or software related thereto.
"Capital Expenditure" has the meaning given to it in Clause 17.3
(Financial Definitions).
"Capital Event Proceeds" means the net cash proceeds received by any
member of the Group from (i) any Financial Indebtedness (other than
Financial Indebtedness of the type described in paragraph (c) of the
definition of such term and/or paragraph (e) of the definition of
Indebtedness for Borrowed Money) incurred or (ii) any debt or equity
securities offerings in the national or international capital
markets, in each case, where the relevant lender, creditor or
noteholder is a person or persons which are not members of the Group
other than:
(a) the cash proceeds of each Rights Offering;
(b) the proceeds from any Exit Financing or the purchase of Exit
Shares (which amount may not exceed $800,000,000);
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(c) the proceeds from any Permitted Refinancing of the Exit
Financing completed within 12 months of the Restatement
Amendment Effective Date;
(d) the proceeds of Permitted Refinancings of the Diamond
Holdings Notes and the Triangle Notes which for the
avoidance of doubt, are actually applied for the purpose of
such refinancings;
(e) Financial Indebtedness under the Senior Bank Credit
Agreement;
(f) Financial Indebtedness used for the Group's working capital,
capital expenditure and other general corporate purposes, in
each case incurred in the ordinary course of business to the
extent that the aggregate principal amount of such Financial
Indebtedness does not exceed (pound)50,000,000 at any one
time outstanding;
(g) Financial Indebtedness incurred for working capital purposes
pursuant to commitments existing on the Execution Date;
(g) Non-Recourse Bank Indebtedness incurred by a Non-Recourse
Subsidiary;
(h) Net cash proceeds received from the issuance of equity
interests (including, without limitation, warrants and
options) to officers, directors and employees pursuant to
stock options or other incentive plans to the extent that
the aggregate amount of such net cash proceeds received
after the Execution Date does not exceed (pound)50,000,000;
and
(i) any net cash proceeds received on conversion and/or
cancellation and reissue of securities,
provided that some or all of the proceeds from the financings
described in paragraphs (b) and/or (c) above may, at the option of
the Borrower and upon not less than 5 Business Days' prior written
notice being given to the Agent be deemed to constitute Capital Event
Proceeds at any time within the period falling 12 months after the
respective closing dates of such financings.
"Capital Event Proceeds Amount" means at any time of the receipt by
the Group of Capital Event Proceeds the aggregate amount of such
Capital Event Proceeds multiplied by the applicable Required
Percentage provided that the Capital Event Proceeds Amount for any
Capital Event Proceeds received during a Remedy Restriction Period
shall be an amount equal to 100% of such Capital Event Proceeds.
"Captive Insurance Company" means NTL Insurance Limited or its
successor as the captive insurance company for the Group (or any part
thereof which includes the UK Group).
"Caxton" means Caxton Holdings Limited, a company incorporated in
England and Wales (company number 3840888), being (prior to the First
Caxton Sale) a wholly owned subsidiary of the Target and, together
with its subsidiaries, comprising the CWC DataCo Business.
"Charged Accounts" means the accounts, bearing interest at a
commercially reasonable rate in relation to the given circumstances,
in the name of each of New
6
NTL and the Parent over which security has been or will be granted in
favour of the Finance Parties (or the Security Trustee on their
behalf) on terms acceptable to the Agent (or if the Senior Bank
Credit Agreement is in effect, in favour of the banks under the
Senior Bank Credit Facility (or a security trustee on their behalf)),
into which members of the UK Group make deposits for the purpose of
making Permitted Payments in accordance with paragraph (d) of the
definition thereof.
"Commitment" means, in relation to a Bank at any time and save as
otherwise provided herein, the amount set opposite its name under the
heading "Commitment" in Schedule 1 (The Banks). The Commitments of
Morgan Stanley Dean Witter Bank Limited and Morgan Stanley Senior
Funding, Inc. shall be determined in accordance with Clause 30.11
(Morgan Stanley Commitment).
"Compliance Certificate" means a certificate substantially in the
form set out in Schedule 4 (Form of Compliance Certificate).
"Confidentiality Undertaking" means a confidentiality undertaking in
the standard form from time to time of the LMA or in such other form
as may be agreed between the Borrower and the Agent, addressed to the
Borrower or, in the case of any confidentiality undertaking dated
after the Restatement Amendment Effective Date, addressed to the
Borrower and New NTL.
"Consolidated Annualised EBITDA" has the meaning given to it in
Clause 17.3 (Financial Definitions).
"Covenant Group" means the Intermediate Parent, any subsidiary of the
Intermediate Parent which is a direct or indirect holding company of
the Borrower, the Borrower and the other members of the UK Group. For
the avoidance of doubt, neither New NTL nor the Parent is a member of
the Covenant Group.
"Covenant Group Obligor" means each member of the Covenant Group
which is an Obligor.
"CWC ConsumerCo Business" means the residential cable, business
cable, indirect residential telephony, residential internet and
digital television development and services businesses owned and
operated by the Target and its subsidiaries.
"CWC DataCo Business" means the corporate, business, internet
protocol and wholesale operations carried on by the Target and its
subsidiaries prior to the First Caxton Sale.
"CWC Holdings" means NTL (CWC Holdings), formerly known as Cable &
Wireless Communications (Holdings) plc, a company incorporated in
England and Wales with company number 3922682.
"Diamond Cable" means Diamond Cable Communications Limited, a company
registered in England and Wales with company number 02965241.
"Diamond Holdings" means Diamond Holdings Limited, a company
registered in England and Wales with company number 03483724.
"Diamond Holdings Notes" means, collectively, the (a) 10% Senior
Notes due 2008 issued by Diamond Holdings (and guaranteed by Diamond
Cable) under an indenture
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dated 6 February 1998 and (b) 91/8% Senior Notes due 2008 issued by
Diamond Holdings (and guaranteed by Diamond Cable) under an indenture
dated 6 February 1998.
"Disclosure Statement" means the written disclosure statement
relating to the Plan, as approved by the Bankruptcy Court on 15 July
2002.
"Dispute" means any dispute referred to in Clause 39 (Jurisdiction).
"Dormant Subsidiary" means, at any time, with respect to any company,
any subsidiary of such company which is "dormant" as defined in
Section 249AA of the Companies Act 1985 (or the equivalent under the
laws of the jurisdiction of incorporation of the relevant company).
"EBIT" has the meaning given to it in Clause 17.3 (Financial
Definitions).
"EBITDA" has the meaning given to it in Clause 17.3 (Financial
Definitions).
"EMU" means Economic and Monetary Union as contemplated in the Treaty
on European Union.
"EMU Legislation" means legislative measures of the European Union
for the introduction of, changeover to or operation of the euro in
one or more member states, being in part legislative measures to
implement the third stage of EMU.
"Encumbrance" means (a) a mortgage, charge, pledge, lien or other
encumbrance securing any obligation of any person, (b) any
arrangement under which money or claims to, or the benefit of, a bank
or other account may be applied, set off or made subject to a
combination of accounts so as to effect discharge of any sum owed or
payable to any person or (c) any other type of preferential
arrangement (including any title transfer and retention arrangement)
having a similar effect.
"Environmental Claim" means any claim, proceeding or investigation by
any person pursuant to any Environmental Law.
"Environmental Law" means any applicable law in any jurisdiction in
which any member of the Covenant Group conducts business which
relates to the pollution or protection of the environment or harm to
or the protection of human health or the health of animals or plants.
"Environmental Permits" means any permit, licence, consent, approval
and other authorisation and the filing of any notification, report or
assessment required under any Environmental Law for the operation of
the business of any member of the Covenant Group conducted on or from
the properties owned or used by the relevant member of the Covenant
Group.
"Equity Rights Offering" means the offer of Equity Rights to holders
of Equity Rights Eligible Preferred Stock and Old Common Stock as of
the Equity Rights Offering Record Date to acquire, as a detachable
unit, New NTL Common Stock and Series A Warrants.
8
"Euroco" means NTL Incorporated (formerly known as NTL Holdings Inc.
and to be renamed NTL Europe, Inc. on the Plan Effective Date), a
company incorporated in Delaware.
"Event of Default" means any circumstance described as such in Clause
19 (Events of Default).
"Excess Capacity Network Services" means the provision of network
services, or agreement to provide network services, by a member of
the UK Group in favour of one or more of its affiliates where such
network services are only provided in respect of the capacity
available to such a member of the UK Group in excess of that network
capacity it requires to continue to provide current services to its
existing and projected future customers and to allow it to provide
further services to both its existing and projected future customers
in accordance with the Updated Business Plan.
"Excess Cash Flow" means, for any Financial Quarter, Operating Cash
Flow for that period less Group Total Debt Service for that period.
"Excess Cash Flow Payment Amount" means for any Financial Quarter, an
amount equal to (a) the amount calculated by reference to the
percentage of Excess Cash Flow required to be applied in repayment of
the Loan as determined by the ratio of UK Group Consolidated Total
Debt to Consolidated Annualised EBITDA for the UK Group for such
Financial Quarter set out in Clause 9.1 (Mandatory Prepayment from
Excess Cash Flow) less (b) the permanent reductions to the advances
and loans made or required to be made in respect of such Financial
Quarter pursuant to Clause 13.1 (Mandatory Prepayment from Excess
Cash Flow) of the Senior Bank Credit Agreement.
"Excluded Debt" means any inter-company loan made by the Parent to
the Intermediate Parent which results from and comprises the
on-lending by the Parent of any part of the proceeds of the Exit
Financing advanced to it by New NTL (as the borrower under the Exit
Financing), where New NTL has used the proceeds of such Exit
Financing to make inter-company loans to the Parent and where such
inter-company loan constitutes Subordinated Debt.
"Execution Date" means the date on which this Agreement was
originally entered into being, 30 May 2000.
"Existing Performance Bonds and Guarantees" means:
(a) performance bonds in an aggregate amount of up to
(pound)7,100,000 issued by Zurich Re at the request of
certain members of the Target Group;
(b) performance bonds in an aggregate amount of up to
(pound)1,139,199 issued by National Westminster Bank Plc at
the request of certain members of the Target Group;
(c) performance bonds in an aggregate amount of up to
(pound)2,800,000 issued by National Westminster Bank Plc at
the request of certain members of the UK Group;
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(d) the performance bond dated 6 May 1999 in an aggregate amount
of up to (pound)2,000,000 issued by JP Morgan Chase Bank at
the request of the Intermediate Parent in favour of the
Commissioners of HM Customs and Excise;
(e) the deed of guarantee dated 30 November 2001 in an amount of
(pound)1,500,000 between JP Morgan Chase Bank and London
Stock Exchange PLC and entered into by JP Morgan Chase Bank
at the request of the Intermediate Parent;
(f) the deed of guarantee dated 6 September 2001 in an amount of
(pound)5,043,438 between The Chase Manhattan Bank (now known
as JP Morgan Chase Bank) and Thomas More Square Limited
relating to premises on floors 1 to 5, The Quadrant, Thomas
More Square, London E1 and entered into by The Chase
Manhattan Bank (now known as JP Morgan Chase Bank) at the
request of the Intermediate Parent;
(g) the deed of guarantee dated 6 September 2001 in an amount of
(pound)1,032,100 between The Chase Manhattan Bank (now known
as JP Morgan Chase Bank) and Thomas More Square Limited
relating to premises on floor 6, The Quadrant, Thomas More
Square, London E1 and entered into by The Chase Manhattan
Bank (now known as JP Morgan Chase Bank) at the request of
the Intermediate Parent; and
(h) the deed of guarantee dated 6 September 2001 in an amount of
(pound)1,990,250 between The Chase Manhattan Bank (now known
as JP Morgan Chase Bank) and Thomas More Square Limited
relating to premises on floors 7 and 8, The Quadrant, Thomas
More Square, London E1 and entered into by The Chase
Manhattan Bank (now known as JP Morgan Chase Bank) at the
request of the Intermediate Parent.
"Exit Financing" means the New NTL Exit Facility (together with the
related payment-in-kind notes referred to at paragraphs (g) and (h)
of the definition of New NTL Exit Facility Agreements) or any
refinancing of the New NTL Exit Facility (together with the related
payment-in-kind notes referred to at paragraphs (g) and (h) of the
definition of New NTL Exit Facility Agreements) on terms set out in
the New NTL Exit Facility Agreements.
"Exit Financing Indenture" means the indenture referred to at
paragraph (a) of the definition of New NTL Exit Facility Agreements.
"Exit Shares" means the 500,000 shares of Common Stock of New NTL
with a par value of $0.01 per share to be purchased by the providers
of the New NTL Exit Facility on or before the Plan Effective Date.
"Extended UK Group" means:
(a) the Borrower;
(b) NTL (South Hertfordshire) Limited (formerly known as Cable &
Wireless Communications (South Hertfordshire) Limited) for
so long as a member of the UK Group is the general partner
of South Hertfordshire United Kingdom Fund, Ltd;
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(c) each of the Borrower's direct and indirect subsidiaries from
time to time (other than each member of the NTL Ireland
Sub-Group); and
(d) each member of the NTL Diamond Sub-Group for so long as the
relevant member of the NTL Diamond Sub-Group is a member of
the Group.
"Facility" means the (pound)1,300,000,000 multiple draw loan facility
granted to the Borrower in this Agreement.
"Facility Office" means, in relation to the Agent, the office
identified with its signature below or such other office as it may
select by notice and, in relation to any Bank, the office notified by
it to the Agent in writing prior to the Execution Date (or, in the
case of a Transferee, at the end of the Transfer Certificate to which
it is a party as Transferee) or such other office as it may from time
to time select by notice to the Agent.
"Final Asset Transferee" means the member of the Group (or any person
in which a member of the UK Group owns an interest but which is not a
member of the Group), other than a member of the Covenant Group, who
is the final transferee in respect of a transfer from the Parent,
through one or more members of the Covenant Group.
"Final Maturity Date" means 31 March 2006.
"Finance Documents" means this Agreement, the fee letter referred to
in Clause 21.1 (Agency Fees), the Security Documents, the Security
Trust Agreement, any Guarantor Accession Memorandum, the
Subordination Agreements, the Intercreditor Agreement, the
Restatement Amendment Agreement and any other document designated as
such by the Agent and the Borrower provided that the letters dated 8
March 2002 and 28 March 2002 from the Agent (on behalf of the Banks)
to the Borrower, the Intermediate Parent and New NTL shall cease to
be Finance Documents on the Restatement Amendment Effective Date.
"Finance Parties" means, at any time, the Agent, the Arrangers, the
Security Trustee and the Banks at such time.
"Financial Indebtedness" means any indebtedness for or in respect of:
(a) Indebtedness for Borrowed Money;
(b) any documentary or standby letter of credit facility or
performance bond facility;
(c) any Hedging Agreement (and the amount of the Financial
Indebtedness in relation thereto shall be calculated by
reference to the mark-to-market valuation of such
transaction at the relevant time); and
(d) (without double counting) any guarantee or indemnity for any
of the items referred to in paragraphs (a) to (c) above.
"Financial Quarter" has the meaning given to it in Clause 17.3
(Financial Definitions).
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"First Caxton Sale" means the transfer, after the Scheme Effective
Date, of Caxton by the Target to CWC Holdings, as authorised by the
Scheme, such a transfer being made at book value (subject to
adjustment under Schedule 19 of the Transaction Agreement), on terms
that the price payable by CWC Holdings is left outstanding to the
extent that CWC Holdings does not assume at least a corresponding
amount of indebtedness of the Target in consideration for the sale of
Caxton.
"Funded Excluded Subsidiary" means a UK Group Excluded Subsidiary or
any person in which a member of the UK Group owns an interest but
which is not a member of the UK Group which:
(a) indirectly receives funding from the Parent; and/or
(b) by way of dividend or other distribution, loan or payment of
interest on or the repayment of the principal amount of any
indebtedness owed by it, directly or indirectly, makes a
payment to the Parent,
in each case by way of a Funding Passthrough.
"Funding Passthrough" means a series of transactions between the
Parent, one or more members of the Covenant Group and a Funded
Excluded Subsidiary where:
(a) in the case of funding being provided by the Parent to the
Funded Excluded Subsidiary, that funding is:
(i) first made available by the Parent to the
Intermediate Parent by way of Subordinated Funding;
(ii) secondly made available by the Intermediate Parent
to the Borrower by way of Parent Funding; and
(iii) thirdly (if relevant) made available by one or more
transactions between members of the UK Group and
finally made available by a member of the UK Group
to the Funded Excluded Subsidiary in all such cases
by way of either the subscription for new equity
capital, the advancing of loans or capital
contribution; or
(b) in the case of a payment to be made by the Funded Excluded
Subsidiary to the Parent, that payment is:
(i) first made by the Funded Excluded Subsidiary to a
member of the UK Group, and thereafter between
members of the Covenant Group (as relevant), by way
of dividend or other distribution, loan or payment
of interest on or the repayment of the principal
amount of any indebtedness owed by such Funded
Excluded Subsidiary or relevant member of the
Covenant Group; and
(ii) finally made by a member of the Covenant Group to
the Parent by way of dividend or other
distribution, loan or the payment of interest on or
the repayment of the principal amount of any
Subordinated Debt owed to the Parent by the
Intermediate Parent.
12
"Group" means:
(a) for the purposes of Clause 16.1 (Annual Statements), Clause
16.2 (Quarterly Statements), Clause 17.2 (Group Financial
Condition), Clause 17.3 (Financial Definitions) and any
other provisions of this Agreement using the definitions
defined in Clause 17.3 (Financial Definitions):
(i) New NTL and its subsidiaries for the time being; and
(ii) NTL (South Hertfordshire) Limited (formerly known
as Cable & Wireless Communications (South
Hertfordshire) Limited) for so long as a member of
the Group is a general partner of South
Hertfordshire United Kingdom Fund, Ltd; and
(b) for all other purposes, New NTL and its Subsidiaries for the
time being.
"Group Structure Chart" means the structure chart showing (at least)
the structure of the Parent Covenant Group and the Covenant Group.
"Group Total Debt Service" has the meaning given to it in Clause 17.3
(Financial Definitions).
"Guarantors" means New NTL, the Intermediate Parent and, on and with
effect from the Plan Effective Date, the Parent and any other person
who becomes a Guarantor pursuant to Clause 37 (Accession of
Guarantors).
"Guarantor Accession Memorandum" means a memorandum substantially in
the form set out in Schedule 7 (Form of Guarantor Accession
Memorandum).
"Hedging Agreement" means an agreement in respect of an interest rate
swap, currency swap, forward foreign exchange transaction, cap,
floor, collar or option transaction or any other treasury transaction
or any combination thereof or any other transaction entered into in
connection with protection against or benefit from fluctuation in any
rate or price.
"Hedging Strategy" means the hedging strategy adopted by the Borrower
from time to time for the sole purpose of hedging the UK Group's then
existing interest rate or currency risk exposure in connection with
its ordinary business acting reasonably and prudently and not for
speculative or proprietary trading purposes.
"ICTA" means the Income and Corporation Taxes Act 1988.
"Indebtedness for Borrowed Money" means any indebtedness for or in
respect of:
(a) moneys borrowed;
(b) any amount raised by acceptance under any acceptance credit
facility;
(c) any amount raised pursuant to any note purchase facility or
the issue of bonds, notes, debentures, loan stock or any
similar instrument (for the avoidance of doubt excluding any
such instrument issued solely by way of consideration for
the acquisition of assets where such an instrument is not
issued for the purpose of raising finance);
13
(d) any amount raised pursuant to any issue of shares which are
expressed to be redeemable in cash (other than redeemable
shares issued by way of consideration for the acquisition of
assets where such shares are not issued for the purpose of
raising finance);
(e) the amount of any liability in respect of any lease or hire
purchase contract which would, in accordance with generally
accepted accounting principles in the relevant jurisdiction,
be treated as a finance or capital lease;
(f) the amount of any liability in respect of any advance or
deferred purchase agreement if the primary reason for
entering into such agreement is to raise finance;
(g) receivables sold or discounted (other than on a non-recourse
basis);
(h) any agreement or option to re-acquire an asset if the
primary reason for entering into such agreement or option is
to raise finance;
(i) any amount raised under any other transaction (including any
forward sale or purchase agreement) having the commercial
effect of a borrowing; and
(j) (without double counting) the amount of any liability in
respect of any guarantee or indemnity for any of the items
referred to in paragraphs (a) to (i) above.
"Information Memorandum" means the document concerning the CWC
ConsumerCo Business and the UK Group which, at, inter alia, the
Borrower's request and on its behalf, was prepared in relation to the
Senior Bank Credit Agreement and distributed by the Arrangers to
selected banks during May 2000.
"Initial Advance Date" means the first date on which Advances are
made under the Facility.
"Instructing Group" means a Bank or Banks to whom in aggregate more
than sixty-six and two thirds per cent. of the amount of the Loan is
(or, immediately prior to its repayment, was then) owed.
"Insurance Proceeds" means the proceeds of any insurance claim
intended to compensate for damage to, or destruction of, any asset or
interruption of business received by any member of the UK Group after
deducting:
(a) any reasonable out of pocket expenses incurred by any member of
the UK Group in relation to such a claim; and
(b) proceeds relating to third party claims, which are applied
towards meeting such claims.
"Intellectual Property" means all patents, trade marks, service
marks, designs, copyrights, design rights, moral rights, inventions,
confidential information, know-how and other intellectual property
rights and interests, whether registered or unregistered, and the
benefit of all licences, applications and rights to use such
14
intellectual property now or hereafter belonging to any member of the
Covenant Group.
"Intercreditor Agreement" means the agreement dated on or about the
Execution Date between (inter alia) the Banks, the lenders under the
Senior Bank Credit Agreement, the Agent and the Security Trustee, by
which the Banks undertake certain obligations in respect of their
rights under this Agreement.
"Interest Period" means, save as otherwise provided herein:
(a) any of those periods mentioned in Clause 4.5 (Interest Periods);
and
(b) in relation to an Unpaid Sum, any of those periods mentioned
in Clause 23.1 (Default Interest Periods).
"Intermediate Parent Inter-Company Loan Assignment" means the
assignment by way of security of inter-company loans dated the
Execution Date and made between the Intermediate Parent and the
Security Trustee (as defined in the Senior Bank Credit Agreement) as
the same may be transferred to the Security Trustee (following
repayment in full of all outstandings due under or in connection with
the Senior Bank Credit Agreement) in accordance with the terms of the
Intercreditor Agreement.
"Intermediate Parent Subordination Agreement" means the subordination
agreement dated the Execution Date and made between the Intermediate
Parent (as the lender), the Borrower (as borrower) and the Security
Trustee, pursuant to which, whilst sums remain outstanding under the
Finance Documents, no payment of interest, repayment of principal or
any other payments of any kind can be made in respect of any
indebtedness owed by the Borrower to the Intermediate Parent, save as
provided therein.
"Intra-Group Services" means:
(a) the provision of services by a member of the UK Group to a
member of the Group, where such member of the Group requires
those services to enable it to carry on its business and
provided that the consideration for the provision thereof is
in the reasonable opinion of the Borrower no less than the
cost (save in any immaterial respect) incurred by such a
member of the UK Group in providing such services;
(b) the provision of services constituted by NTL Group Limited
employing personnel, acting as agent to buy equipment or
other assets or services or trade with residential customers
on behalf of other members of the Group, where the costs of
such employment or purchasing and the costs and revenues
generated by such trading are in the reasonable opinion of
the Borrower reimbursed by or distributed (save in any
immaterial respect) to the relevant Group member; and
(c) the provision of services constituted by NTL Business
Limited (formerly named NTL Technologies Limited) acting as
agent to trade with business customers on behalf of other
members of the Group, where the costs and revenues of such
trading are in the reasonable opinion of the Borrower
15
reimbursed by or distributed (save in any immaterial
respect) to the relevant Group member.
"Ireland" means the Republic of Ireland.
"LIBOR" means, in relation to any amount to be advanced to or owing
by an Obligor under the Finance Documents on which interest for a
given period is to accrue:
(a) the percentage rate per annum equal to the offered quotation
which appears on the page of the Telerate Screen which
displays the British Bankers Association Interest Settlement
Rate for sterling (being currently "3750") or the currency
of any Unpaid Sum for such period as of 11.00 a.m. on the
Quotation Date for such period or, if such page or such
service shall cease to be available, such other page or such
other service for the purpose of displaying the British
Bankers Association Interest Settlement Rate for sterling
(or the currency of such Unpaid Sum) as the Agent, after
consultation with the Banks and the Borrower, shall select;
or
(b) if no quotation for sterling (or the currency of such Unpaid
Sum) and the relevant period is displayed and the Agent has
not selected an alternative service on which a quotation is
displayed, the arithmetic mean (rounded upwards to five
decimal places) of the rates (as notified to the Agent) at
which each of the Reference Banks was offering to prime
banks in the London interbank market deposits in sterling
(or the currency of such Unpaid Sum) for such period as of
11.00 a.m. on the Quotation Date for such period.
"Licences" means each licence which is material to the conduct of the
business of any member of the Covenant Group.
"LMA" means the Loan Market Association.
"Loan" means, at any time, the aggregate principal amount of the
outstanding Advances at such time.
"Mandatory Cost Rate" means the rate determined in accordance with
Schedule 5 (Mandatory Costs).
"Margin" means 4.50 per cent. per annum, provided that the Margin
shall increase by 0.50 per cent. per annum on the three month
anniversary of the Initial Advance Date and by an additional 0.50 per
cent. per annum on each subsequent three month anniversary of the
Initial Advance Date.
"Material Adverse Effect" means a material adverse effect on (a) the
business, operations, property or condition (financial or otherwise)
of the UK Group taken as a whole or (b) the ability of any Covenant
Group Obligor to perform its material obligations under the Finance
Documents to which it is a party.
"Material Commercial Contracts" means any commercial agreements
entered into by any member of the Covenant Group which are reasonably
likely to be material to the business or prospects of the Covenant
Group taken as a whole.
16
"Monthly Performance Update Report" means the report to be prepared
by the Reporting Accountants and delivered to the Agent in respect of
(inter alia) the performance of the Extended UK Group during the
relevant month against the projected performance of the Extended UK
Group as set out in the Updated Business Plan and each relevant
Budget delivered after the date of the Updated Business Plan.
"Net Average Revenue Contributions" means, at any time:
(a) the aggregate of the Average Revenue Contributions of all
assets disposed of by members of the UK Group under
paragraph (g) of the definition of Permitted Disposals,
less
(b) the aggregate of the estimated Average Revenue Contributions
of all assets acquired by members of the UK Group either in
exchange for, or out of the proceeds of the disposal of,
assets disposed of under paragraph (g) of the definition of
Permitted Disposals (such estimated Average Revenue
Contributions to be reasonably agreed between the Borrower
and the Agent on the basis of the revenues such acquired
assets could have reasonably been expected to have generated
for the two financial years of the Borrower immediately
preceding the date of their acquisition, had such assets
been owned by the relevant member of the UK Group throughout
those two financial years).
"New NTL Exit Facility" means $[558,600,000] aggregate principal
amount at maturity (exclusive of any payment-in-kind notes), 19%
Senior Secured Notes due 2010 issued by New NTL on or prior to the
Plan Effective Date.
"New NTL Exit Facility Agreements" means:
(a) the indenture between New NTL, the guarantors listed therein
and U.S. Bank National Association as trustee pursuant to
which New NTL will issue $ [558,600,000] aggregate principal
amount at maturity (exclusive of any payment-in-kind notes)
of 19% senior secured notes due 2010;
(b) the purchase agreement between New NTL, the guarantors
listed therein and the purchasers listed therein and entered
into in connection with the Exit Financing Indenture;
(c) the exchange and registration rights agreement between New
NTL, the guarantors listed therein and the purchasers listed
therein and entered into in connection with the Exit
Financing Indenture;
(d) the Triangle stock pledge agreement made by the holders of
membership interests in NTL (Triangle) LLC in favour of, or
for the benefit of, U.S. Bank National Association as
collateral agent for the benefit of the Secured Parties (as
defined therein) and the other parties thereto and entered
into in connection with the Exit Financing Indenture;
(e) the pledge and security agreement made by New NTL and the
senior guarantors listed therein in favour of, or for the
benefit of, U.S. Bank National
17
Association as trustee for the benefit of the Secured
Parties (as defined therein) and the other parties thereto
and entered into in connection with the Exit Financing
Indenture;
(f) the equity registration rights agreement between New NTL and
the purchasers listed therein and entered into in connection
with the Exit Financing Indenture;
(g) the 19% senior secured notes due 2010 and referred to in the
definition of New NTL Exit Facility and any replacement
senior secured note issued as a result of the loss or
destruction of any issued senior secured note or issued to a
transferee of any issued senior secured note together with
any payment-in-kind notes issued in accordance with such
senior secured notes; and
(h) if and when issued as provided in the exchange and
registration rights agreement referred to at paragraph (c)
above or the Exit Financing Indenture, New NTL's senior
secured notes due 2010 issued in the Registered Exchange
Offer in exchange for the senior secured notes referred to
at paragraph (g) above or otherwise as provided in the Exit
Financing Indenture together with any payment-in-kind notes
issued in accordance with such senior secured notes,
in the case of each of the agreements referred to at paragraphs (a)
to (f) above and the 19% senior secured notes due 2010 referred to at
paragraph (g) above (other than any replacement senior secured notes
or payment-in-kind notes referred to at paragraph (g) above), dated
on or before the Plan Effective Date.
"Non-Recourse Bank Indebtedness" means any Financial Indebtedness
incurred by a Non-Recourse Subsidiary from financial institutions
pursuant to a bank credit or loan agreement where the liabilities of
such Non-Recourse Subsidiary in respect of such Financial
Indebtedness are not directly or indirectly the subject of a
guarantee, indemnity or any other form of assurance, undertaking or
support from any other member of the Group (other than the
subsidiaries of such person).
"Non-Recourse Subsidiary" means a person which is a member of the
Group (other than a member of the Covenant Group, the Parent and any
direct or indirect parent company of the Parent) and whose creditors
have no recourse to any other member of the Group (other than the
subsidiaries of such person) in respect of any Financial Indebtedness
of that person or any of its subsidiaries (other than recourse to any
member of the Group which has granted security over its shares or
other interests in such a Non-Recourse Subsidiary beneficially owned
by it provided that such recourse is limited to the realisation of
such security).
"Noteholder Election Option" means the option offered to the NTL CC
Subordinated Notes Holders, the NTL Delaware Subordinated Notes
Holders (other than France Telecom), and the NTL Inc. Subordinated
Notes Holders (other than France Telecom) as of the Noteholder
Election Option Record Date, to purchase (a) shares of New NTL Common
Stock and (b) shares of New NTL Common Stock (each accompanied by a
Series A Warrant) that were not subscribed for in the Equity Rights
Offering.
"NTL Delaware, Inc." means NTL (Delaware) Inc. (formerly named NTL
Incorporated), a company incorporated in Delaware.
18
"NTL Delaware Subordinated Debt" means Financial Indebtedness
incurred under the NTL Delaware Subordinated Note.
"NTL Delaware Subordinated Note" means the note dated 5 April, 2002
in the principal amount of (pound)90,000,000 evidencing indebtedness
originally owed by the Intermediate Parent to NTL Delaware Inc and to
be transferred, on the Plan Effective Date, by NTL (Delaware) Inc. to
the Parent against consideration paid in cash in an amount equal to
the face amount (or its equivalent in dollars) of such note together
with accrued interest thereon.
"NTL Diamond Sub-Group" means Diamond Cable, Diamond Holdings and
each of their respective subsidiaries from time to time.
"NTL Ireland Sub-Group" means NTL Communications (Ireland) Limited
and its subsidiaries from time to time.
"NTL Triangle Sub-Group" means NTL Triangle LLC and its subsidiaries
from time to time.
"NTLIH" means NTL Investment Holdings Limited, a company incorporated
in England and Wales with company number 3173552.
"Obligors" means the Borrower and the Guarantors.
"Oftel" means the Director General of Telecommunications and/or any
other successor or other body or authority having, inter alia, the
right, function and/or obligation to monitor and enforce compliance
with the provisions of licences issued pursuant to the
Telecommunications Act 1984.
"Operating Cash Flow" has the meaning given to it in Clause 17.3
(Financial Definitions).
"Overdraft Facility" means any facility provided by a United Kingdom
clearing bank to a member of the UK Group.
"Parent Covenant Group" means New NTL and any subsidiary of New NTL
which is a holding company of the Borrower (which as at the
Restatement Amendment Effective Date is the Parent and the
Intermediate Parent).
"Parent Funding" means:
(a) the subscription by the Intermediate Parent for new equity
capital of the Borrower; or
(b) Subordinated Debt incurred by the Borrower from the
Intermediate Parent.
"Parent Inter-Company Loan Assignment" means the assignment by way of
security of certain inter-company loans made by the Parent to the
Intermediate Parent (other than in relation to Excluded Debt) dated
on or about the Restatement Amendment Effective Date and made between
the Parent and the Security Trustee.
"Parent Subordination Agreement" means the subordination agreement
dated 15 July 2002 made between the Parent (as the creditor), the
Intermediate Parent (as
19
borrower) and the Security Trustee as amended and restated by an
amendment agreement dated on or about the Restatement Amendment
Effective Date, pursuant to which, whilst sums remain outstanding
under the Finance Documents, no payment of interest, repayment of
principal or any other payments of any kind can be made in respect of
any indebtedness owed by the Intermediate Parent to the Parent, save
as provided therein.
"Participating Member State" means any member state of the European
Union which has adopted the euro as its lawful currency at the
relevant time.
"Permitted Acquisitions" means:
(a) the incorporation of a company (which is or immediately
becomes a member of the UK Group) or the acquisition of the
shares in a newly incorporated company (which is or
immediately becomes a member of the UK Group) from its
subscribing shareholders, where such a company at all times:
-
(i) carries on business in an administrative capacity,
supporting the business of the UK Group (as carried
on in accordance with Clause 18.24 (Change of
Business));
(ii) acts as a captive insurance company in the role
previously performed by NTL Insurance Limited;
(iii) acts as a holding company for, or operating company
of, the assets of National Transcommunications
Limited, Singapore branch;
(iv) acts as a vehicle for a Permitted Acquisition; or
(v) acts as a healthcare trust company in relation to
the administration and provision of health benefits
to be provided to other members of the Group;
(b) any acquisition made by a member of the Covenant Group
pursuant to the implementation of an Asset Passthrough or a
Funding Passthrough;
(c) any acquisition of assets as referred to in paragraphs (a)
or (c) of the definition of Asset Adjustment Payments;
(d) any acquisition made by a member of the UK Group of assets
from a company carrying on the CWC DataCo Business where (i)
no consideration is paid by the member of the UK Group to
the company carrying on the CWC DataCo Business in
connection with the transfer of such assets and (ii) Cable &
Wireless is obliged to pay to such company carrying on the
CWC DataCo Business the full market value (if any) of the
relevant assets transferred, all in accordance with the
Transaction Agreement;
(e) any acquisition by an Obligor or a member of the UK Group
pursuant to a Permitted Disposal within paragraphs (f), (h)
or (i) of the definition of Permitted Disposals and any
acquisition by a member of the Covenant Group of shares
issued by a wholly-owned subsidiary of the Intermediate
Parent which is a member of the Covenant Group provided that
such shares are
20
issued on terms permitted or not prohibited by the Senior
Bank Credit Agreement or, if all or part of the shares of
such wholly-owned subsidiary are subject to the Security,
such issued shares are subject to such Security in the
manner described in paragraph (i) of this definition;
(f) certain acquisitions to be agreed by an Instructing Group
(subject to such limitations including in relation to the
aggregate value thereof, as may be required by the
Instructing Group) of assets of Euroco and its subsidiaries;
(g) any acquisition which is specifically and separately
consented to in writing by an Instructing Group prior to
such acquisition being made;
(h) the acquisition of the assets of National
Transcommunications Limited, Singapore branch, by a newly
incorporated company which is a member of the UK Group and
which acts as a holding company for, or an operating company
of, such assets;
(i) any acquisition of newly issued shares in the Borrower by
the Intermediate Parent or the acquisition of newly issued
shares in the Intermediate Parent by the Parent, in each
case, where such issuance of shares has been made in
consideration of the cancellation and/or satisfaction in
whole or in part of any inter-company indebtedness owing by
the Borrower to the Intermediate Parent or by the
Intermediate Parent to the Parent (as the case may be) and
where 65% of such newly issued shares in the Borrower or all
of such newly issued shares in the Intermediate Parent (as
the case may be) are made subject to the terms of the Share
Charge or the Pledge Agreement (as the case may be), form a
part of the Security created thereunder and where the share
certificates and stock transfer forms (or the equivalent
thereof) relating to such newly issued shares which are to
be the subject of such security are delivered to the
Security Trustee pursuant to the terms thereof; and
(j) acquisitions not falling within paragraphs (a) to (i) above
provided that the aggregate value of acquisitions permitted
by this paragraph (j) shall not in any Financial Year of the
Borrower, exceed in aggregate (pound)25,000,000 (or its
equivalent in other currencies).
"Permitted Disposal" means any disposal:
(a) made in the ordinary and usual course of business;
(b) on arm's length commercial terms of an asset by a member of
the UK Group who is not an Obligor;
(c) for cash (if the relevant asset has any value) on arm's
length commercial terms of any surplus or obsolete assets no
longer required for the efficient operation of the business
of the UK Group;
(d) of cash, where such a disposal is not otherwise prohibited
by the Finance Documents;
(e) by way of a realisation of a Permitted Investment;
21
(f) by an Obligor to another Obligor, provided that if the
relevant assets are subject to an Encumbrance pursuant to a
Security Document, they remain so or become subject to a
similar Encumbrance in favour of the Finance Parties in the
hands of the acquiring Obligor, in each case without the
re-opening of any insolvency related hardening periods under
applicable US insolvency legislation;
(g) on (A) arm's length commercial terms for cash consideration
or (B) in exchange for similar assets located in either the
United Kingdom or Ireland which the Agent (acting
reasonably) determines to be of a comparable or superior
quality provided that:
(i) in each case the Net Average Revenue Contributions
at no time exceed 5 per cent. of the consolidated
revenues of the UK Group, determined on a per annum
basis; and
(ii) the proceeds of any disposal under (A) of this
paragraph (g) are applied in accordance with Clause
9.2 (Mandatory Prepayment from Asset Disposals);
(h) of an interest in real or heritable property by way of a
lease or licence granted by a member of the UK Group to
another member of the UK Group;
(i) by a member of the UK Group to another member of the UK
Group;
(j) of any assets as referred to in paragraphs (b) or (d) of the
definition of Asset Adjustment Payments;
(k) of any assets by a member of the UK Group to a company
carrying on the CWC DataCo Business where (i) no
consideration is paid by the company carrying on the CWC
DataCo Business to the member of the UK Group in connection
with the transfer of such assets and (ii) New NTL is obliged
to pay or, if no so obliged, pays to such member of the UK
Group the full market value (if any) of the relevant assets
transferred, all in accordance with the Transaction
Agreement or, as the case may be, the Asset Adjustment
Payments Memorandum;
(l) of any assets pursuant to the implementation of an Asset
Passthrough or of any funds received pursuant to the
implementation of a Funding Passthrough;
(m) by National Transcommunications Limited, Singapore branch,
of its assets to a newly incorporated company which is a
member of the UK Group and which acts as a holding company
for, or an operating company of, such assets; and
(n) which is specifically and separately consented to in writing
by an Instructing Group prior to such disposal being made.
For the avoidance of doubt, in no event shall the transfer of the
shares of the Borrower or any Guarantor to a person which is not a
Guarantor constitute a Permitted Disposal.
"Permitted Encumbrance" means:
22
(a) any existing Encumbrance specified in Schedule 3 (Existing
Encumbrances) provided that the principal amount thereby
secured is not increased;
(b) any Encumbrance over or affecting any asset acquired by a
member of the UK Group after the Execution Date and subject
to which such asset is acquired, if:
(i) such Encumbrance was not created in contemplation
of the acquisition of such asset by a member of the
UK Group; and
(ii) the Financial Indebtedness secured by such
Encumbrance at all times falls within paragraph (k)
of the definition of Permitted Indebtedness;
(c) any Encumbrance over or affecting any asset of any company
which becomes a member of the UK Group after the Execution
Date, where such Encumbrance is created prior to the date on
which such company becomes a member of the UK Group, if:
(i) such Encumbrance was not created in contemplation
of the acquisition of such company; and
(ii) the Financial Indebtedness secured by such
Encumbrance at all times falls within paragraph (i)
or (k) of the definition of Permitted Indebtedness;
(d) any netting or set-off arrangement entered into by the
Intermediate Parent or any member of the UK Group in the
normal course of its banking arrangements for the purpose of
netting debit and credit balances;
(e) any right of set-off or any title transfer or retention of
title arrangement entered into by the Intermediate Parent or
any member of the UK Group in the normal course of its
trading activities on the counterparty's standard or usual
terms (where such terms reasonably accord with the terms
generally adopted in the market to which such a trading
activity relates);
(f) any lien arising by operation of law or by a contract having
a similar effect and in each case arising or entered into in
the normal course of business, if such lien is discharged
within thirty days of arising;
(g) any Encumbrance created pursuant to, arising under or
evidenced by the Security Documents;
(h) any Encumbrance granted by a member of the UK Group over the
shares or other interests it holds in, or over the assets
attributable to, a Project Company;
(i) any Encumbrance created by any arrangements referred to in
paragraph (e) or paragraph (f) of the definition of
Indebtedness for Borrowed Money;
(j) any Encumbrance arising pursuant to an order of attachment,
an injunction restraining the disposal of assets or any
similar legal process in each case arising in connection
with court proceedings being diligently conducted by an
Obligor or any member of the UK Group in good faith;
23
(k) any Encumbrance over cash deposited as security for the
obligations of a member of the UK Group in respect of a
performance bond, guarantee, standby letter of credit or
similar facility entered into by such a member of the UK
Group in the ordinary course of business;
(l) any Encumbrance on assets of the Intermediate Parent or any
member of the UK Group securing the obligations under the
Finance Documents (as defined in the Senior Bank Credit
Agreement);
(m) any Encumbrance constituted by a rent deposit deed entered
into on arm's length terms and in the ordinary course of
business securing the obligations of a member of the UK
Group in relation to property leased to a member of the UK
Group;
(n) any Encumbrance securing Permitted Indebtedness falling
within paragraph (k) of the definition of Permitted
Indebtedness;
(o) any Encumbrance existing as at the Restatement Amendment
Effective Date and which relates solely to the South Herts
Refinancing Loan;
(p) any Encumbrance over the shares of NTL (Triangle) LLC where
such Encumbrance is granted as security for amounts due
under the New NTL Exit Facility Agreements or any Permitted
Refinancing of the Exit Financing; and
(q) any Encumbrance granted in favour of the New NTL Lenders in
respect of the Exit Financing or the lenders in respect of
any Permitted Refinancing of the Exit Financing over assets
of any Covenant Group Obligor or any member of the UK Group
to the extent such assets have not already been charged to
the Security Trustee in respect of the liabilities of the
Obligors under the Finance Documents.
"Permitted Indebtedness" means any Financial Indebtedness of any
member of the Covenant Group:
(a) arising under or permitted pursuant to the Finance
Documents;
(b) in respect of Subordinated Debt and/or Assigned Debt and/or
Excluded Debt;
(c) arising in relation to the implementation of the Hedging
Strategy;
(d) arising under Permitted Loans and Guarantees;
(e) arising under Secured Ancillary Facilities or in relation to
any documentary or standby letter of credit facility or
performance bond facility made available by a financial
institution on an unsecured basis provided that the
aggregate indebtedness of all members of the UK Group in
relation to such facilities and the Secured Ancillary
Facilities does not exceed (pound)40,000,000 (or its
equivalent in other currencies);
(f) falling within paragraph (e) of the definition of
Indebtedness for Borrowed Money ("Finance Lease Debt")
which, when aggregated with any other Finance Lease Debt
incurred in reliance on this paragraph (f) by each member
24
of the UK Group does not exceed (pound)45,000,000 (or its
equivalent in other currencies);
(g) arising in respect of the Existing Performance Bonds and
Guarantees;
(h) in respect of Permitted Overdraft Borrowings provided that
the aggregate amount of such Financial Indebtedness does not
exceed (pound)20,000,000 (or its equivalent in other
currencies);
(i) of any company which became or becomes a member of the UK
Group after the Execution Date, where such Financial
Indebtedness arose prior to the date on which such company
became or becomes a member of the UK Group, if:
(i) such Financial Indebtedness was not created in
contemplation of the acquisition of such company;
(ii) the aggregate amount of all Financial Indebtedness
falling within this paragraph (i) does not exceed
(pound)20,000,000 (or its equivalent in other
currencies); and
(iii) such Financial Indebtedness is repaid within three
months of such company becoming a member of the UK
Group;
(j) arising in relation to either an Asset Passthrough or a
Funding Passthrough;
(k) not falling within paragraphs (a) to (j) above, of any
members of the UK Group provided that the aggregate amount
of such Financial Indebtedness does not exceed
(pound)20,000,000 (or its equivalent in other currencies)
and, in the case of any such Financial Indebtedness (other
than where such Financial Indebtedness arises in respect of
any performance bond facility or any other facility of a
similar type) incurred after the Restatement Amendment
Effective Date, the final maturity date of such Financial
Indebtedness is a date no earlier than 1 March 2008;
(l) arising in respect of a refinancing of the Diamond Holdings
Notes or the Triangle Notes;
(m) arising under the Senior Bank Credit Agreement and any
guarantee or other covenant for payment given in respect of
the Senior Bank Credit Agreement (or under a covenant for
payment given in the Security Documents or the Second
Security Documents (as defined in the Senior Bank Credit
Agreement));
(n) incurred on or after the Restatement Amendment Effective
Date provided that:
(i) the Group Net Consolidated Total Debt to
Consolidated Annualised EBITDA of the Group
covenant set out in Clause 17.2 (Group Financial
Condition) is complied with and will be complied
with on a proforma basis for the duration of the
Facility; and
25
(ii) the final maturity date of such indebtedness is a
date not earlier than 1 March 2008;
(o) arising in respect of the Exit Financing or any Permitted
Refinancing of the Exit Financing;
(p) any other Financial Indebtedness incurred in connection with
the Plan and specifically and separately consented to by an
Instructing Group; and
(q) where such is owed by the Intermediate Parent to the Parent
or by the Intermediate Parent to New NTL under or in
connection with the NTL Delaware Subordinated Debt or any
refinancing thereof from time to time provided that such
refinancing (i) shall not exceed (pound)90,000,000 together
with accrued interest (or its equivalent in other
currencies), (ii) shall itself constitute Subordinated Debt
and (iii) provides that interest shall be compounded and
payable only upon maturity.
"Permitted Investments" means:
(a) any debt securities which are readily marketable and which
are rated at least "AA" by Standard & Poor's Corporation or
"Aa2" by Moody's Investors Service, Inc.;
(b) certificates of deposit and deposits with banks and bankers
acceptances in each case with a bank rated at least A- (or
the equivalent thereof) by Moody's Investors Service, Inc.
or Standard & Poor's Corporation; or
(c) commercial paper rated at least A-1 (or the equivalent
thereof) by Moody's Investors Service, Inc. or Standard &
Poor's Corporation.
"Permitted Loans and Guarantees" means:
(a) trade credit or guarantees or indemnities granted in the
ordinary course of business on usual and customary terms;
(b) loans made by any member of the UK Group to its employees
either (i) in the ordinary course of its employees'
employment or (ii) to fund the exercise of share options by
its employees;
(c) loans permitted pursuant to paragraph (b) of the definition
of Permitted Indebtedness;
(d) loans made by a member of the Covenant Group pursuant to
either an Asset Passthrough or a Funding Passthrough;
(e) loans made by a member of the UK Group to another member of
the UK Group;
(f) loans made by a member of the UK Group to a member of the
Covenant Group, where the proceeds of such a loan are
(whether directly or indirectly) used to fund a Permitted
Payment in accordance with this Agreement (including, but
not limited to, the timing requirements set out in the
definition of "Permitted Payments");
26
(g) credit granted by any member of the UK Group to a member of
the Group, where the indebtedness outstanding thereunder
relates to Intra-Group Services provided that where such
credit relates to services falling within paragraphs (b) or
(c) of the definition of Intra-Group Services: -
(i) the settlement of all such credit estimated by the
Borrower to be owed by members of the Group which
are not members of the UK Group shall take place no
less frequently than on a monthly basis; and
(ii) if, on the first Business Day falling after the
fourteenth day of each calendar month, the
aggregate amount of all such credit owed by members
of the Group which are not members of the UK Group
is estimated by the Borrower to be in excess of
(pound)25,000,000 (or its equivalent in other
currencies) all such credit shall be promptly
settled at such time provided that any overpayment
or underpayment arising as a result of the
settlement of all such credit may be returned to
the overpaying party or paid by the underpaying
party;
(h) the South Herts Refinancing Loan;
(i) the Cable & Wireless Loan (as defined in the Senior Bank
Credit Agreement) or other loans arising in connection with
the Transaction Agreement;
(j) loans made, credit granted and guarantees or indemnities
given in aggregate amount not exceeding (pound)200,000;
(k) deferred consideration in an amount of up
to (pound)52,500,000 owed to NTL (CWC) Limited in relation to
the disposal of NTL Telephone Equipment Limited; and
(l) any guarantee or indemnity given by a member of the Covenant
Group in respect of any Permitted Indebtedness (or under a
covenant to pay in relation to any Permitted Encumbrance
executed by any member of the Covenant Group in relation to
any Permitted Indebtedness) or other obligation not
restricted by the terms of the Finance Documents, of another
member of the Covenant Group.
"Permitted Overdraft Borrowings" means Financial Indebtedness in
respect of an Overdraft Facility if such Financial Indebtedness:
(a) has been incurred solely for short term cash management
purposes in the ordinary course of business; and
(b) is fully repaid within three Business Days of it having been
incurred (from available funds other than Permitted
Overdraft Borrowings).
"Permitted Payment" means (i) a payment which is not restricted by
the definition of Restricted Payment (including for the avoidance of
doubt, from the Borrower to the Intermediate Parent) and (ii) a
Restricted Payment which is:
27
(a) made, at any time, to fund the actual cash payment
obligations (other than the repayment or prepayment of
principal) of any member of the Parent Covenant Group in
relation to:
(i) the Exit Financing or any indebtedness incurred
pursuant to any Permitted Refinancing of the Exit
Financing;
(ii) indebtedness incurred by a member of the Group
(other than a member of the UK Group) the proceeds
of which have been contributed to the Borrower by
way of Subordinated Funding (as defined in the
Senior Bank Credit Agreement) after the Restatement
Amendment Effective Date in accordance with the
provisions of Clause 22.16 (Mandatory Contribution)
of the Senior Bank Credit Agreement;
(iii) indebtedness incurred by any member of the Group
(other than a member of the UK Group) the proceeds
of which have been voluntarily contributed to the
Borrower by way of Subordinated Funding (as defined
in the Senior Bank Credit Agreement) after the
Restatement Amendment Effective Date (being for the
avoidance of doubt, indebtedness which does not
fall within paragraph (ii) above);
(iv) any indebtedness incurred by any member of the
Group (other than a member of the UK Group) in
order to refinance the Diamond Holding Notes or the
Triangle Notes;
(v) indebtedness incurred by any member of the Group
(other than a member of the UK Group) after the
Restatement Amendment Effective Date, subject
always to compliance with the Group Net
Consolidated Total Debt to Consolidated Annualised
EBITDA of the Group covenant set out in Clause 17.2
(Group Financial Condition); or
(vi) any Hedging Agreement entered into by the Parent or
New NTL under which the Parent or New NTL, as the
case may be, enters into currency or interest swaps
in relation to underlying Financial Indebtedness of
the Parent Covenant Group;
which, in each case, have fallen due or will fall due within
five Business Days of such Permitted Payment being made
provided that the cash portion of any interest payable on
indebtedness which may be funded by a Permitted Payment
under paragraph (a)(ii) (other than any indebtedness
incurred by a member of the Parent Covenant Group to
refinance (whether in whole or in part) the Facility),
(iii), (iv) or (v) above shall not exceed 6 per cent. over
the average yield of the index of securities issued by US
cable television companies included in the Applicable High
Yield Index (measured at the time the indebtedness is
incurred);
(b) made, at any time, to fund the payment of corporate expenses
(including taxes) by any member of the Parent Covenant Group
(which for the avoidance of doubt shall not include any
member of the NTL Diamond Sub-Group or any member of the NTL
Triangle Sub-Group), the aggregate amount of such payments
during each financial year of the Borrower being no greater
than (pound)10,000,000 (or its equivalent in other
currencies);
28
(c) pursuant to an Asset Passthrough and funded solely from cash
generated by entities outside of the UK Group or made
available pursuant to a Funding Passthrough and funded
solely from cash generated by entities outside of the UK
Group;
(d) deposited in a Charged Account and:
(i) represents the proceeds from a payment of interest
on Subordinated Debt which within two Business Days
of receipt by the Intermediate Parent is paid (x)
by the Intermediate Parent to the Parent and within
two Business Days of receipt by the Parent is paid
by the Parent to New NTL or (y) by the Intermediate
Parent to the Parent, in each case, in accordance
with the arrangements the Group has with the Inland
Revenue; and
(ii) in each case referred to at paragraph (i) above, is
reinvested in the Borrower within ten Business Days
of such Restricted Payment being made, such an
investment being by way of Subordinated Funding or
Parent Funding;
(e) made out of the proceeds of an Asset Adjustment Payment
referred to in paragraph (b) of the definition thereof
received by a member of the UK Group;
and provided always that any such payment shall only be permitted if
and to the extent that no Event of Default has occurred (and is
continuing) or would result from the making of such payment and
provided further that Permitted Payments under paragraph (a) or (b)
above may only be made, if and to the extent that, the aggregate cash
resources (including any undrawn available facilities) of the members
of the Parent Covenant Group would, in the absence of the proposed
Permitted Payment, fall below (pound)150,000,000 (or its equivalent
in other currencies).
For the avoidance of doubt and notwithstanding any provisions to the
contrary in any Subordination Agreement, no Permitted Payments may be
made in respect of any indebtedness which is Subordinated Debt and
which is outstanding on the Restatement Amendment Effective Date
other than as a means of facilitating any of the Permitted Payments
listed in paragraphs (a) to (e) above and subject at all times to the
limitations listed in paragraphs (a) to (e) above.
"Permitted Refinancings" means the refinancing by any member of the
Parent Covenant Group of: -
(a) the Exit Financing (and for the avoidance of doubt, any
refinancing of the Exit Financing may be by way of the
issuance of equity or the raising of debt and may take place
in one or more tranches);
(b) the Diamond Holdings Notes; and
(c) the Triangle Notes,
provided that the final maturity date of any indebtedness incurred in
respect of any such refinancing is a date no earlier than the Final
Maturity Date.
29
"Plan" means the Debtors' second amended joint plan of reorganisation
in respect thereof under Chapter 11 dated 15 July 2002, together with
all exhibits thereto, in each case, as amended by a confirmation
order in respect thereof dated 5 September 2002.
"Plan Effective Date" shall bear the meaning given to the term
"Effective Date" in the Plan.
"Pledge Agreement" means the Pledge Agreement dated on or about the
Restatement Amendment Effective Date executed by the Parent in favour
of the Security Trustee relating to 100% of the capital stock of the
Intermediate Parent.
"Potential Event of Default" means any event which would become (with
the passage of time, the giving of notice, the making of any
determination hereunder or any combination thereof) an Event of
Default.
"Prepayment Escrow Account" means an account, bearing interest at a
commercially reasonable rate in relation to the given circumstances,
held with the Agent (or such other financial institution reasonably
acceptable to the Agent) in the name of the Borrower, over which the
Borrower has granted or will grant security in favour of the Security
Trustee and into which sums are deposited in accordance with Clause 9
(Mandatory Prepayment).
"Prescribed Accounting Period" means a prescribed accounting period
as defined in the Value Added Tax Regulations 1995, as applicable to
the relevant member of the UK Group.
"Project Company" means a subsidiary of a company (or a person in
which such company has an interest), which has a special purpose and
whose creditors have no recourse to any other member of the Covenant
Group in respect of any Financial Indebtedness of that subsidiary or
person (as the case may be) or any of such subsidiary's or person's
subsidiaries (other than recourse to such member of the Covenant
Group which has granted security over its shares or other interest in
such a Project Company beneficially owned by it provided that such
recourse is limited to the realisation of such security).
"Properties" means the properties owned or leased by members of the
UK Group.
"Proportion" means, in relation to a Bank at any time, the proportion
which its Commitment bears to the Total Commitments.
"Qualifying Lender" means:
(a) a Bank which is (on the date a payment of interest falls due
under a Finance Document) beneficially entitled to and
within the charge to United Kingdom corporation tax in
respect of that payment provided that the advance in respect
of which the payment is made was made by a bank for the
purposes of section 349 of ICTA at the time that the advance
was made; or
(b) a Treaty Lender.
"Quarter Date" has the meaning given to it in Clause 17.3 (Financial
Definitions).
30
"Quotation Date" means, in relation to any period for which an
interest rate is to be determined under the Finance Documents, the
day on which quotations would ordinarily be given by prime banks in
the London Interbank Market for deposits in the currency of the
relevant sum for delivery on the first day of that period, provided
that, if, for any such period, quotations would ordinarily be given
on more than one date, the Quotation Date for that period shall be
the last of those dates.
"Reference Banks" means the principal London offices of JP Morgan
Chase Bank, and the principal London offices of two other Banks
agreed between the Agent and the Borrower or such other bank or banks
as may from time to time be agreed between the Borrower and the Agent
acting on the instructions of an Instructing Group.
"Registered Exchange Offer" means the offer by New NTL pursuant to
the exchange and registration rights agreement referred to at
paragraph (c) of the definition of New NTL Exit Facility Agreements
to certain holders of the senior secured notes referred to in the
definition of New NTL Exit Facility, to issue and deliver to such
holders, in exchange for such senior secured notes, a like aggregate
principal amount at maturity of exchange notes registered under the
Securities Act of 1933 (as amended).
"Relevant Period" has the meaning given to it in Clause 17.3
(Financial Definitions).
"Remedy Restriction Period" means any period during which the rights
and remedies of the Banks which would otherwise arise by reason of an
Event of Default (whether or not such Event of Default is deemed
waived pursuant to the Intercreditor Agreement) are restricted,
delayed or suspended, or the Banks are required to waive (or are
deemed to have waived) conditions to drawdown hereunder, pursuant to
the terms of the Intercreditor Agreement as in effect on the
Execution Date.
"Repeated Representations" means each of the representations set out
in Clause 15.4 (Status and Due Authorisation) to Clause 15.15
(Existing Group Indebtedness).
"Reporting Accountants" means the accountancy firm engaged by the
Agent on behalf of the Banks to advise the Banks in connection with
matters relating to, inter alia, the financial position and
performance of the Group and compliance with certain obligations set
out in this Agreement which, as at the date of the Restatement
Amendment Effective Date, is PricewaterhouseCoopers.
"Reporting Accountants Mandate Letter" means the mandate letter dated
on or about the date of the Restatement Amendment Agreement from
PricewaterhouseCoopers as Reporting Accountants to the Agent and the
Senior Agent and countersigned by each of the Agent, the Senior
Agent, New NTL, the Borrower and NTL Investment Holdings Limited.
"Required Monthly Information" means the information set out at
Appendix B of the Reporting Accountants Mandate Letter as being
required to be delivered by New NTL, the Borrower and/or NTL
Investment Holdings Limited to the Reporting Accountants to enable
preparation of the Monthly Performance Update Report, including:
31
(a) a report on 13 week short-term cash flow forecast for the UK
Group, such report to include:
(i) forecast cash receipts by month;
(ii) forecast debtor days;
(iii) forecast supplier payments and assumptions
regarding the unwinding of the opening accounts
payable ledger and accruals balances, as well as
assumed payment terms on new purchases; and
(iv) details of other cash flow items and material
assumptions; and
(b) a monthly management account pack for the Extended UK Group,
such management account pack to include:
(i) monthly and year-to-date revenues, gross margin and
EBITDA for the Extended UK Group and by division
compared to budget;
(ii) details of any exceptional costs;
(iii) monthly Capital Expenditure spend and details of
material projects;
(iv) a summary net cash flow statement and aggregated
balance sheet for the Extended UK Group; and
(v) a commentary on monthly performance.
"Required Percentage" means 80 per cent. provided that, where the
Borrower has notified the Agent that any or all of the financings
listed in paragraphs (b) and (c) of the definition of Capital Event
Proceeds are to be deemed (in whole or in part)to constitute Capital
Event Proceeds (at any time with the period falling 12 months after
the respective closing dates of any such financings), the Required
Percentage shall be a percentage of up to 100 per cent., as selected
by the Borrower.
"Reservations" means:
(a) the principle that equitable remedies are remedies which may
be granted or refused at the discretion of the court, the
limitation of enforcement by laws relating to bankruptcy,
insolvency, liquidation, reorganisation, court schemes,
moratoria, administration and other laws generally affecting
the rights of creditors, the time barring of claims under
any applicable law, the possibility that an undertaking to
assume liability for or to indemnify against non-payment of
any stamp duty or other tax may be void, defences of set-off
or counterclaim and similar principles;
(b) anything analogous to any of the matters set out in
paragraph (a) above under any laws of any applicable
jurisdiction; and
(c) the reservations in or anything disclosed by any of the
legal opinions delivered pursuant to (i) Clause 2.4
(Conditions Precedent) and Schedule 3 (Conditions Precedent)
of the Agreement in the form as at the Execution Date, (ii)
32
Schedule 8 (Additional Conditions Precedent) of this
Agreement or (iii) Clause 2 (Restatement) of the Restatement
Amendment Agreement.
"Restatement Amendment Agreement" means the amendment agreement dated
[o] 2002 and made between the parties hereto which amends this
Agreement by way of a restatement of this Agreement.
"Restatement Amendment Effective Date" means the date on which the
Restatement Amendment Effective Time occurs.
"Restatement Amendment Effective Time" means the "Effective Time" as
such term is defined in the Restatement Amendment Agreement.
"Restatement Amendment Financial Statements" means:
(a) in relation to New NTL, its annual report on Form 10-K for
its financial year ended 31 December 2001; and
(b) in relation to the Borrower, the audited consolidated
financial statements for the UK Group for the financial year
ended 31 December 2001.
"Restricted Group" means any member of the Group other than (a) the
Intermediate Parent and (b) any member of the UK Group which is an
Obligor under (and as defined in) the Senior Bank Credit Agreement.
"Restricted Payment" means any payment by a member of the Covenant
Group to a member of the Restricted Group (a) by way of dividend or
other distribution or (b) by way of interest on or repayment of the
principal amount of or any other payment (other than a payment by way
of loan) in respect of or in connection with intra-Group Indebtedness
for Borrowed Money (other than to the extent required by the Borrower
to meet its interest payment obligations under this Agreement).
"Rights Offerings" means the Equity Rights Offerings and the
Noteholder Election Option.
"Scheme" means the scheme of arrangement under Section 425 in
relation to the Target.
"Scheme Effective Date" means 12 May 2000.
"Second Caxton Sale" means the transfer of Caxton by CWC Holdings to
Cable & Wireless (UK) Holdings plc in part satisfaction of the
reduction in the share capital of CWC Holdings occurring prior to the
Acquisition, such reduction being confirmed by the court in
accordance with Section 135 of the Companies Act 1985.
"Section 425" means section 425 of the Companies Act 1985.
"Secured Ancillary Facilities" has the meaning given to it in the
Senior Bank Credit Agreement.
"Security" means the security from time to time constituted by or
pursuant to the Security Documents.
33
"Security Documents" means the Pledge Agreement, the Share Charge,
the Parent Inter-Company Loan Assignment, the Intermediate Parent
Inter-Company Loan Assignment (to the extent assigned to the Security
Trustee pursuant to the Intercreditor Agreement) and any other
agreement or document pursuant to which any member of the Group
creates any security interest in favour of the Finance Parties (or
the Security Trustee on their behalf) for all or any part of the
obligations of the Obligors or any of them under any of the Finance
Documents.
"Security Trust Agreement" means the security trust agreement dated
the Execution Date, entered into in connection herewith and made
between the Parent, the Intermediate Parent and the Security Trustee.
"Senior Agent" means the person from time to time appointed as agent
of the banks under the Senior Bank Credit Agreement.
"Senior Bank Credit Agreement" means the (pound)2,500,000,000 Credit
Agreement dated on or about the Execution Date among the Borrower,
NTL Business Limited, New NTL, JP Morgan Chase Bank (formerly known
as Chase Manhattan Plc) and Morgan Stanley Dean Witter Bank Limited,
as arrangers and joint book managers, JP Morgan Europe Limited
(formerly known as Chase Manhattan International Limited), as agent
and security trustee and others as amended and restated by a
restatement amendment agreement dated on or about the date of the
Restatement Amendment Effective Date and from time to time and the
"Senior Bank Loan" and the "Senior Bank Credit Facility" shall be
construed accordingly.
"Share Charge" means the share charge dated the Execution Date and
given by the Intermediate Parent in favour of the Security Trustee
relating to 65% of the issued share capital of the Borrower.
"South Herts Facility" has the meaning given to it in the Senior Bank
Credit Agreement.
"South Herts Refinancing Loan" has the meaning given to it in the
Senior Bank Credit Agreement.
"Specified Financial Indebtedness" means any Financial Indebtedness
of the Parent or any Guarantor (other than arising in respect of any
letters of credit or performance bonds issued at the request of a
member of the Group in the ordinary course of its business) arising
under (a) the Exit Financing, (b) any Permitted Refinancing of the
Exit Financing and (c) any Financial Indebtedness incurred to
refinance the Facility in whole or in part.
"Statutory Requirements" means any applicable provision or
requirement of any Act of Parliament including the Telecommunications
Act 1984, the Cable and Broadcasting Act 1984 and the Cable and the
Broadcasting Act 1990 or any instrument, rule or order made under any
Act of Parliament or any regulation or by-law of any local or other
competent authority or any statutory undertaking or statutory company
which has jurisdiction in relation to the carrying out, use,
occupation, operation of the properties or the businesses of any
member of the UK Group carried out thereon.
"Steering Committee Group" means the Arrangers.
34
"Subordinated Debt" means:
(a) any loan made by the Parent to the Intermediate Parent
(including for the avoidance of doubt, the NTL Delaware
Subordinated Debt) or by the Intermediate Parent to the
Borrower where such loan has been subordinated to the Loan
on the terms of a Subordination Agreement; and
(b) any other inter-company loan between Obligors as the Agent
may agree where such loan has been subordinated to the
obligations of the Obligors to the Finance Parties under the
Finance Documents on the terms of a Subordination Agreement.
"Subordinated Funding" means:
(a) the subscription by the Parent for new equity capital of the
Intermediate Parent; and
(b) Subordinated Debt.
"Subordination Agreements" means:
(a) the Intermediate Parent Subordination Agreement;
(b) the Parent Subordination Agreement; and
(c) any other subordination agreement in the agreed form
executed or to be executed by any member of the Group in
favour of the Security Trustee relating to Subordinated
Debt.
"Syndication Date" means 4 September 2000.
"Target" means Cable and Wireless Communications plc (company number
3288998) (now known as NTL (CWC) Limited).
"Target Group" means CWC Holdings, Target and its direct and indirect
subsidiaries (other than such of the Target Group Excluded
Subsidiaries (as defined in the Senior Bank Credit Agreement) which
were subsidiaries of the Target immediately after the Second Caxton
Sale) immediately after the Second Caxton Sale, such comprising the
CWC ConsumerCo Business.
"Total Commitments" means, at any time, the aggregate of the Banks'
Commitments.
"Transaction Agreement" means the restated agreement dated as of 26
July 1999 between Bell Atlantic Corporation, Cable & Wireless, the
Target and Euroco (as amended from time to time before the
Restatement Amendment Effective Date and as amended from time to time
after the Restatement Amendment Effective Date, and notified to the
Agent).
"Transfer Certificate" means a certificate substantially in the form
set out in Schedule 2 (Form of Transfer Certificate) or in such other
form as may be agreed between the Borrower and the Agent signed by a
Bank and a Transferee under which:
35
(a) such Bank seeks to procure the transfer to such Transferee
of all or a part of such Bank's rights, benefits and
obligations under the Finance Documents upon and subject to
the terms and conditions set out in Clause 30.3 (Assignments
and Transfers by Banks); and
(b) such Transferee undertakes to perform the obligations it
will assume as a result of delivery of such certificate to
the Agent as contemplated in Clause 30.5 (Transfers by
Banks).
"Transfer Date" means, in relation to any Transfer Certificate, the
date for the making of the transfer as specified in such Transfer
Certificate.
"Transferee" means a person to which a Bank seeks to transfer by
novation all or part of such Bank's rights, benefits and obligations
under the Finance Documents.
"Treaty Lender" means a Bank which is (on the date a payment falls
due under a Finance Document) entitled to that payment under a double
taxation agreement in force with the United Kingdom on that date
(subject to the completion of any necessary procedural formalities)
without a deduction or withholding for or on account of tax imposed
by the United Kingdom from such a payment.
"Treaty on European Union" means the Treaty of Rome of 25 March 1957,
as amended by the Single European Act 1986 and the Maastricht Treaty
(which was signed at Maastricht on 7 February 1992 and came into
force on 1 November 1993).
"Triangle Notes" means the 11.2% senior discount debentures due 15
November 2007, with a principal amount at maturity of $517,300,000,
issued by NTL Triangle LLC (formerly known as Comcast UK Cable
Partners Limited).
"UK Group" means:
(a) for the purposes of the definition of Required Monthly
Information, Clause 15.9 (Audited Financial Statements),
Clause 16.1 (Annual Statements), Clause 16.2 (Quarterly
Statements), Clause 17.1 (UK Group Financial Condition),
Clause 17.3 (Financial Definitions) and any other provision
of this Agreement using the definitions defined in Clause
17.3 (Financial Definitions):
(i) the Borrower;
(ii) NTL (South Hertfordshire) Limited (formerly known
as Cable & Wireless Communications (South
Hertfordshire) Limited) for so long as a member of
the UK Group is a general partner of South
Hertfordshire United Kingdom Fund, Ltd; and
(iii) each of the Borrower's direct and indirect
subsidiaries from time to time, excluding the UK
Group Excluded Subsidiaries (other than NTL (South
Hertfordshire) Limited (formerly known as Cable &
Wireless Communications (South Hertfordshire)
Limited); and
(b) for all other purposes, the Borrower and each of its direct
or indirect subsidiaries from time to time other than the UK
Group Excluded Subsidiaries.
36
For information purposes only, the members of the UK Group on the
Restatement Amendment Effective Date are listed in Schedule 12
(Members of the UK Group) to the Senior Bank Credit Agreement.
"UK Group Excluded Subsidiary" means:
(a) any subsidiary of the Borrower which is a Dormant Subsidiary
and which (i) has assets (save for loans existing on the
Execution Date owed to it by other members of the UK Group)
with an aggregate value of (pound)10,000 or less; (ii) does
not hold a Licence; and (iii) is not a Guarantor (as defined
in the Senior Bank Credit Agreement).
(b) Moleseye Limited;
(c) Fawnspring Limited;
(d) any member of the NTL Triangle Sub-Group (until such time as
the Borrower elects for the members of the NTL Triangle
Sub-Group to become guarantors under the Senior Bank Credit
Facility in accordance with Clause 37.4 (NTL Triangle
Accession) of the Senior Bank Credit Agreement);
(e) NTL (South Hertfordshire) Limited (formerly known as Cable &
Wireless Communications (South Hertfordshire) Limited) and
its subsidiaries, until such time as NTL (South
Hertfordshire) Limited becomes a wholly-owned subsidiary of
the Borrower;
(f) any subsidiary of the Borrower which is a Project Company;
and
(g) any company which becomes a subsidiary of the Borrower after
the Execution Date pursuant to an Asset Passthrough,
provided that, any of such companies shall become a member of the UK
Group and cease to be a UK Group Excluded Subsidiary if the Borrower
and the Agent (acting on the instructions of an Instructing Group,
acting reasonably) so agree.
"Unpaid Sum" means the unpaid balance of any of the sums referred to
in Clause 23.1 (Default Interest Periods).
"Updated Business Plan" means the business plan for the Group in the
agreed form and delivered as a condition precedent to the Restatement
Amendment Agreement.
"VAT Act" means the Value Added Tax Act 1994.
1.2 Interpretation
Any reference in this Agreement to:
the "Agent", an "Arranger", the "Security Trustee" or any "Bank"
shall be construed so as to include it and any subsequent successors
and permitted transferees in accordance with their respective
interests;
37
an "affiliate" of a person shall be construed as a reference to a
subsidiary of that person or a holding company of that person or any
other subsidiary or holding company of that holding company:
"agreed form" in relation to any document means a form which is
initialed by (or by lawyers acting on behalf of) each of the Agent
and the Borrower for the purposes of identification (as such form may
be amended from time to time by agreement between such parties) or,
if not so initialised, is a document in form and substance reasonably
satisfactory to the Agent;
"assets" includes present and future properties, revenues and rights
of every description;
a "company" includes any body corporate;
"continuing", in relation to an Event of Default, shall be construed
as a reference to an Event of Default which has not been waived (any
deemed waiver pursuant to the Intercreditor Agreement not being a
waiver for these purposes) in writing or remedied and, in relation to
a Potential Event of Default, one which has not been remedied within
the relevant grace period or waived (any deemed waiver pursuant to
the Intercreditor Agreement not being a waiver for these purposes) in
accordance with the terms hereof;
"disposal" includes any sale, lease, transfer or other disposal;
the "equivalent" on any date in one currency (the "first currency")
of an amount denominated in another currency (the "second currency")
is a reference to the amount of the first currency which could be
purchased with the amount of the second currency at the spot rate of
exchange quoted by the Agent at or about 11.00 a.m. on such date for
the purchase of the first currency with the second currency;
"HM Customs & Excise" shall be construed as including "the
Commissioners" as defined in section 96(1) of the VAT Act.
a "holding company" of a company or corporation shall be construed as
a reference to any company or corporation of which the
first-mentioned company or corporation is a subsidiary;
"indebtedness" shall be construed so as to include any obligation
(whether incurred as principal or as surety) for the payment or
repayment of money, whether present or future, actual or contingent;
a "law" shall be construed as any law (including common or customary
law), statute, constitution, decree, judgment, treaty, regulation,
directive, bye-law, order or any other legislative measure of any
government, supranational, local government, statutory or regulatory
body or court;
a "member state" shall be construed as a reference to a member state
of the European Union;
38
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 succeeding calendar month save that:
(a) if any such numerically corresponding day is not a Business
Day, such period shall end on the immediately succeeding
Business Day to occur in that next succeeding calendar month
or, if none, it shall end on the immediately preceding
Business Day; and
(b) if there is no numerically corresponding day in that next
succeeding calendar month, that period shall end on the last
Business Day in that next succeeding calendar month,
(and references to "months" shall be construed accordingly);
a "person" shall be construed as a reference to any person, firm,
company, corporation, government, state or agency of a state or any
association or partnership (whether or not having separate legal
personality) of two or more of the foregoing;
"repay" (or any derivative form thereof) shall, subject to any
contrary indication, be construed to include "prepay" (or, as the
case may be, the corresponding derivative form thereof) and vice
versa;
a "subsidiary" of a company or corporation shall be construed as a
reference to:
(a) any company or corporation:
(i) which is controlled, directly or indirectly, by the
first-mentioned company or corporation;
(ii) more than half the issued share capital of which is
beneficially owned, directly or indirectly, by the
first-mentioned company or corporation; or
(iii) which is a subsidiary of another subsidiary of the
first-mentioned company or corporation,
and, for these purposes, a company or corporation shall be
treated as being controlled by another if that other company
or corporation is able to direct its affairs and/or to
control the composition of its board of directors or
equivalent body; and
(b) for the purposes of only Clause 16 (Financial Information),
Clause 17 (Financial Condition) and where the financial
definitions referred to in Clause 17.3 (Financial
Definitions) are used in this Agreement, any company or
corporation which is a subsidiary undertaking as defined in
Section 258 of the Companies Act 1985 or any other legal
entity which is accounted for as a subsidiary of that first
mentioned company or corporation;
a "successor" shall be construed so as to include an assignee or
successor in title of such party and any person who under the laws of
its jurisdiction of incorporation or
39
domicile has assumed the rights and obligations of such party under
this Agreement or to which, under such laws, such rights and
obligations have been transferred;
"tax" shall be construed so as to include any tax, levy, impost, duty
or other charge of a similar nature (including any penalty or
interest payable in connection with any failure to pay or any delay
in paying any of the same);
"VAT" shall be construed as a reference to United Kingdom value added
tax as imposed by the VAT Act and any legislation supplemental
thereto;
a "wholly-owned subsidiary" of a company or corporation shall be
construed as a reference to any company or corporation which has no
other members except that other company or corporation and that other
company's or corporation's wholly-owned subsidiaries or persons
acting on behalf of that other company or corporation or its
wholly-owned subsidiaries; and
the "winding-up", "dissolution" or "administration" of a company or
corporation shall be construed so as to include any equivalent or
analogous proceedings under the law of the jurisdiction in which such
company or corporation is incorporated or any jurisdiction in which
such company or corporation carries on business including the seeking
of liquidation, winding-up, reorganisation, dissolution,
administration, arrangement, adjustment, protection or relief of
debtors.
1.3 Currency Symbols
1.3.1 "(pound)" and "sterling" denote lawful currency of the
United Kingdom and "$" and "dollars" denote lawful currency
of the United States of America.
1.3.2 "euro" means the single currency unit of the European
Union as constituted by the Treaty on European Union as
referred to in EMU Legislation and "euro unit" means the
currency unit of the euro as defined in EMU Legislation.
1.4 Agreements and Statutes
Any reference in a Finance Document to:
1.4.1 this Agreement or any other agreement or document shall be
construed as a reference to this Agreement or, as the case
may be, such other agreement or document as the same may
have been, or may from time to time be, amended, varied,
novated or supplemented (subject to and in accordance with
the provisions of this Agreement, where applicable); and
1.4.2 a statute or treaty shall be construed as a reference to
such statute or treaty as the same may have been, or may
from time to time be, amended or, in the case of a
statute, re-enacted.
1.5 Headings
Clause and Schedule headings are for ease of reference only.
40
1.6 Time
Any reference in this Agreement to a time of day shall, unless a
contrary indication appears, be a reference to London time.
1.7 Third Party Rights
A person who is not a party to this Agreement has no right under the
Contracts (Rights of Third Parties) Act 1999 to enforce any term of
this Agreement.
1.8 Definitions contained in the Plan
The following definitions when used herein shall bear the same
meanings as those ascribed to them in Article I (Definitions, Rules
of Interpretation and Computation of Time) of the Plan.
"Equity Rights", "Equity Rights Eligible Preferred Stock", "Equity
Rights Offering Record Date", "France Telecom", "New NTL Common
Stock", "New NTL Lenders", "Noteholder Election Option Record Date",
"NTL CC Subordinated Notes Holders", "NTL Delaware Subordinated Notes
Holders", "NTL Inc. Subordinated Notes Holders", "Old Common Stock"
and "Series A Warrants".
2. THE FACILITY
2.1 Grant of the Facility
The Banks have granted to the Borrower, upon the terms and subject to
the conditions hereof, a sterling multiple draw loan facility in an
aggregate amount of (pound)1,300,000,000, as the same may be reduced
in accordance with the terms hereof.
2.2 Purpose
The Facility was used to fund loans by the Borrower to other members
of the UK Group each of which utilized the proceeds thereof to
finance the working capital requirements of the UK Group, and in no
event were the proceeds of any Advance used for a purpose other than
to finance the construction, capital expenditure and working capital
needs of a Cable Business.
2.3 Application
The Borrower confirms that it has applied all amounts raised by it
hereunder in or towards satisfaction of, the purposes specified in
Clause 2.2 (Purpose) and none of the Finance Parties shall be obliged
to concern themselves with such application.
2.4 Banks' Obligations Several
The obligations of each Bank are several and the failure by a Bank to
perform its obligations hereunder shall not affect the obligations of
an Obligor towards any other party hereto nor shall any other party
be liable for the failure by such Bank to perform its obligations
hereunder.
41
2.5 Banks' Rights Several
The rights of each Bank are several and any debt arising hereunder at
any time from an Obligor to any of the other parties hereto shall be
a separate and independent debt. Each such party shall, save as
provided in this Agreement and the Security Trust Agreement, be
entitled to protect and enforce its individual rights arising out of
this Agreement independently of any other party (so that it shall not
be necessary for any party hereto to be joined as an additional party
in any proceedings for this purpose).
3. UTILISATION OF THE FACILITY
With effect from the Restatement Amendment Effective Time, all
Available Commitments shall be cancelled and reduced to zero.
4. PAYMENT AND CALCULATION OF INTEREST ON ADVANCES; INTEREST PERIODS
4.1 Payment of Interest
On the last day of each Interest Period (and, if the Interest Period
of such Advance exceeds six months, on the expiry of each period of
six months during such Interest Period) the Borrower shall pay
accrued interest on the Advance to which such Interest Period
relates.
4.2 Calculation of Interest
The rate of interest applicable to an Advance from time to time
during an Interest Period relating thereto shall be the rate per
annum which is the lesser of:
4.2.1 16 per cent. per annum; and
4.2.2 the sum of:
(a) the Margin at such time;
(b) the Mandatory Cost Rate; and
(c) LIBOR on the Quotation Date therefor.
4.3 Limitations on Cash Interest.
Notwithstanding anything to the contrary set forth in this Agreement,
to the extent that the rate of interest applicable to an Advance on
any interest payment date for such Advance exceeds the sum of 14 per
cent. per annum and the increase, if any, in the rate of interest
pursuant to Clause 4.4 (Default Interest) such excess interest shall
be paid by adding such excess interest to the principal amount of
such Advance unless the Borrower shall have given the Agent notice at
least three Business Days prior to such interest payment date that it
shall pay such excess amount in cash.
4.4 Default Interest
The interest rate determined in accordance with Clause 4.2
(Calculation of Interest) shall be increased by one per cent. per
annum (it being understood that the interest
42
rate could by reason of such increase exceed 16 per cent. per annum)
from the date determined by the Agent (acting reasonably) (in
writing) as being the date on which an Event of Default or Potential
Event of Default has occurred or come into existence until the date
specified by the Agent (in writing) as being the date on which it has
been demonstrated to its satisfaction (acting reasonably) that such
Event of Default or Potential Event of Default is no longer
continuing. The Agent shall promptly notify the other parties hereto
of any determination that an Event of Default or Potential Event of
Default has occurred or exists or, as the case may be, that it has
been demonstrated to its satisfaction (acting reasonably) that such
is no longer continuing.
4.5 Interest Periods
The period for which an Advance is outstanding shall be divided into
successive periods each of which (other than the first, which shall
begin on the day such Advance is made) shall start on the last day of
the preceding such period.
4.6 Duration
The duration of each Interest Period shall, save as otherwise
provided herein, be one, two, three or six months or such other
period as the Agent (acting on instructions of all the Banks) may
agree in each case as the Borrower may by not less than five Business
Days' prior notice to the Agent select, provided that:
4.6.1 if the Borrower fails to give such notice of its selection
in relation to an Interest Period, the duration of that
Interest Period shall, subject to sub-clauses 4.6.2 and
4.6.3 be one month;
4.6.2 if there are more than five Advances outstanding any
Interest Period which begins during or at the same time as
anyone or more other Interest Periods shall end at the
same time as such one of those other Interest Periods as
the Borrower may, by not less than five Business Days'
prior notice to the Agent, select or, failing such
selection, the first such other Interest Period to expire;
and
4.6.3 any Interest Period which would otherwise end during the
month preceding, or extend beyond, the Final Maturity Date
shall be of such duration that it shall end on the Final
Maturity Date;
4.7 Consolidation of Advances
If two or more Interest Periods end at the same time, then, on the
last day of those Interest Periods, the Advances to which they relate
shall be consolidated into and treated as a single Advance.
4.8 Division of Advances
The Borrower may, by not less than five Business Days' prior notice
to the Agent, direct that any Advance shall, at the beginning of any
Interest Period relating thereto, be divided into (and thereafter,
save as otherwise provided herein, treated in all respects as) two or
more Advances in such amounts (in aggregate, equaling the amount of
the Advance being so divided) as shall be specified by the Borrower in
43
such notice, provided that the Borrower shall not be entitled to
make such a direction if:
4.8.1 as a result of so doing, there would be more than five
outstanding Advances; or
4.8.2 any Advance thereby coming into existence would be of an
amount less than (pound)50,000,000.
5. MARKET DISRUPTION AND ALTERNATIVE INTEREST RATES
5.1 Market Disruption
If, in relation to any Advance:
5.1.1 LIBOR is to be determined by reference to Reference Banks
and at or about 11.00 a.m. on the Quotation Date for the
relevant Interest Period none or only one of the Reference
Banks supplies a rate for the purpose of determining LIBOR
for the relevant Interest Period; or
5.1.2 before the close of business in London on the Quotation
Date for such Advance the Agent has been notified by a
Bank or each of a group of Banks, to whom in aggregate
fifty per cent. or more of such Advance is owed that LIBOR
does not accurately reflect the cost of funding its
participation in such Advance,
then the Agent shall notify the Borrower and the Banks of such event
and, notwithstanding anything to the contrary in this Agreement,
Clause 5.2 (Substitute Interest Period and Interest Rate) shall apply
to such Advance.
5.2 Substitute Interest Period and Interest Rate
If sub-clause 5.1.1 of Clause 5.1 (Market Disruption) applies to an
Advance, the duration of the relevant Interest Period shall be one
month or, if less, such that it shall end on the Final Maturity Date.
If either sub-clause 5.1.1 or 5.1.2 of Clause 5.1 (Market Disruption)
applies to an Advance, the rate of interest applicable to each Bank's
portion of such Advance during the relevant Interest Period shall
(subject to any agreement reached pursuant to Clause 5.3 (Alternative
Rate)) be the rate per annum which is the sum of:
5.2.1 the Margin at such time;
5.2.2 the Mandatory Cost Rate; and
5.2.3 the rate per annum notified to the Agent by such Bank
before the last day of such Interest Period to be that
which expresses as a percentage rate per annum the cost to
such Bank of funding from whatever sources it may
reasonably select its portion of such Advance during such
Interest Period.
5.3 Alternative Rate
If either of those events mentioned in sub-clauses 5.1.1 or 5.1.2 of
Clause 5.1 (Market Disruption) occurs in relation to an Advance, then
if the Agent or the Borrower so
44
requires, the Agent and the Borrower shall enter into negotiations
with a view to agreeing a substitute basis (i) for determining the
rates of interest from time to time applicable to the Advances and/or
(ii) upon which the Advances may be maintained (whether in sterling
or some other currency) thereafter and any such substitute basis that
is agreed shall take effect in accordance with its terms and be
binding on each party hereto, provided that the Agent may not agree
any such substitute basis without the prior consent of each Bank
(which is not to be unreasonably withheld).
6. NOTIFICATION
6.1 Interest Periods
Not less than three Business Days before the first day of an Interest
Period, the Agent shall notify each Bank of the proposed amount of
the relevant Advance, the proposed length of such Interest Period and
the aggregate principal amount of the relevant Advance allocated to
such Bank pursuant to Clause 3.2 (Each Bank's Participation in
Advances).
6.2 Interest Rate Determination
The Agent shall promptly notify the Borrower and the Banks of each
determination of LIBOR, the Mandatory Cost Rate and the Margin.
6.3 Changes to Advances or Interest Rates
The Agent shall promptly notify the Borrower and the Banks of any
change to (a) the proposed length of an Interest Period or (b) any
interest rate occasioned by the operation of Clause 5 (Market
Disruption and Alternative Interest Rates).
7. REPAYMENT AND REDUCTION OF THE FACILITY
7.1 Repayment
The Borrower shall repay each Advance made to it in full on the Final
Maturity Date.
8. PREPAYMENT
8.1 Prepayment of the Facility
Subject to the provisions of Clause 8.5 (Limitations on Prepayment of
the Facility) and Clause 23.4 (Break Costs), the Borrower may, by
giving to the Agent not less than five Business Days prior written
notice to that effect, prepay the whole or any part of an Advance
(being a minimum amount of (pound)50,000,000 and an integral multiple
of (pound)10,000,000).
8.2 Notice of Prepayment
Any notice of prepayment given by the Borrower pursuant to this
Clause 8 (Prepayment) shall be irrevocable, shall specify the date
upon which such prepayment is to be made and the amount of such
prepayment and shall oblige the Borrower to make such prepayment on
such date.
45
8.3 Repayment of a Bank's Share of the Loan
If:
8.3.1 any sum payable to any Bank by an Obligor is required to
be increased pursuant to Clause 10.1 (Tax Gross-up); or
8.3.2 any Bank claims indemnification from an Obligor under
Clause 10.2 (Tax Indemnity), the Agent claims
indemnification from an Obligor under Clause 10.2 (Tax
Indemnity) in respect of a payment received by it and paid
by it to a Bank under the Finance Documents or any Bank
claims indemnification from the Borrower under Clause 12.1
(Increased Costs),
the Borrower may, whilst such circumstance continues, give the Agent
at least five Business Days prior written notice (which notice shall
be irrevocable) of its intention to procure the repayment of such
Bank's share of the Loan. On the last day of each then current
Interest Period, or at any other time subject to the provisions of
Clause 23.4 (Break Costs), the Borrower shall repay such Bank's
portion of the Advance to which such Interest Period relates.
8.4 No Other Repayments
The Borrower shall not repay all or any part of the Loan except at
the times and in the manner expressly provided for in this Agreement
and shall not be entitled to reborrow any amount repaid.
8.5 Limitations on Prepayment of the Facility
Notwithstanding anything to the contrary set forth in this Clause 8
(Prepayment), the Borrower may not voluntarily prepay all or any part
of an Advance pursuant to Clause 8.1 (Prepayment of the Facility) at
any time that the Senior Bank Credit Agreement is in effect, without
the consent of the Senior Agent under the Senior Bank Credit
Facility, unless such reduction or prepayment is permitted under
Clause 22.28 (Working Capital Facility Amendments) of the Senior Bank
Credit Agreement.
9. MANDATORY PREPAYMENT
9.1 Mandatory Prepayment from Excess Cash Flow
The Borrower shall ensure that within 15 Business Days of delivery of
the most recent financial statements of the UK Group pursuant to
Clause 16.2 (Quarterly Statements), commencing with the financial
statements delivered in respect of the Financial Quarter ending 31
December 2002, the Borrower's determination of the Excess Cash Flow
Payment Amount (if any) for the Financial Quarter to which such
quarterly financial statements relate (such determination of the
Excess Cash Flow Payment Amount to be made by reference to such
quarterly financial statements and to be set out in sufficient detail
(including the relevant numbers used in computing each component part
of "Operating Cash Flow" and "Group Total Debt Service") delivered
with such quarterly financial statements)) is applied in repayment of
the Loan in accordance with Clause 9.6 (Application of Proceeds)
irrespective of whether or not the Reporting Accountants have, prior
to the end of such 15 Business Day period, verified the Borrower's
determination of Excess Cash Flow and the actual Excess
46
Cash Flow Payment Amount payable hereunder. The percentage of Excess
Cash Flow in any Financial Quarter applicable for the purposes of
paragraph (a) of the definition of "Excess Cash Flow Payment Amount"
shall be determined by reference to the ratio of UK Group
Consolidated Total Debt to Consolidated Annualised EBITDA of the UK
Group for such Financial Quarter in accordance with the table below:
----------------------------------------------------------------------------------------------
Ratio of UK Group Consolidated Percentage of Excess Cash Flow
Total Debt to Consolidated Annualised applicable for the purposes of paragraph
EBITDA for the UK Group (a) of Excess Cash Flow Payment Amount
----------------------------------------------------------------------------------------------
Greater than or equal to 4.00:1 75 per cent.
----------------------------------------------------------------------------------------------
Less than 4.00:1 50 per cent.
----------------------------------------------------------------------------------------------
provided that if, pursuant to the foregoing provisions of this Clause
9.1, any amount is applied in repayment of the Loan in accordance
with Clause 9.6 (Application of Proceeds) prior to verification by
the Reporting Accountants of the Borrower's determination of Excess
Cash Flow and the Excess Cash Flow Payment Amount, and the subsequent
verification thereof by the Reporting Accountants demonstrates that:
(a) any additional amounts constituting the Excess Cash Flow
Payment Amount for the relevant Financial Quarter should
have been applied in repayment of the Loan in order to fully
satisfy the Borrower's obligations under this Clause 9.1,
the Borrower shall, within 5 Business Days of receipt of
notification to such effect from the Agent or from the
Reporting Accountants on behalf of the Agent apply such
further amount in repayment of the Loan in accordance with
Clause 9.6 (Application of Proceeds); or
(b) the Excess Cash Flow Payment Amount which should have been
applied in repayment of the Loan in order to fully satisfy
the Borrower's obligations under this Clause 9.1 for the
relevant Financial Quarter (the "Verified Amount") is less
than the amount actually applied by the Borrower in
repayment of the Loan in respect of such Financial Quarter
(the "Applied Amount"), the difference between the Applied
Amount and the Verified Amount shall be deducted (but
deducted once only) from any future Excess Cash Flow Payment
Amount which falls due, pursuant to the foregoing provisions
of this Clause 9.1, to be applied in repayment of the Loan
in accordance with Clause 9.6 (Application of Proceeds).
9.2 Mandatory Prepayment from Asset Disposals
9.2.1 Subject to sub-clause 9.2.2 and sub-clause 9.2.3 below, at
all times prior to the date upon which the Exit Financing
is repaid in full, the Borrower shall ensure that (a) the
net proceeds of any disposal falling within paragraph (g)
(A) of the definition of Permitted Disposals of any asset
by any member of
47
the UK Group; and (b) the Net Proceeds of any Asset
Disposition made by any member of the UK Group which have
not been either:
(i) In the case of (a) or (b) above, applied as capital
expenditure by members of the UK Group (subject to
a cap for capital expenditure of the Group of
$10,000,000 (or its equivalent in other currencies)
in each financial year of New NTL) within 365 days
of the receipt of such proceeds; or
(ii) In the case of (b) above, to the extent such Net
Proceeds represent proceeds received from an
insurance claim, applied in amelioration of an
involuntary loss, damage, destruction or
condemnation of assets, towards the replacement,
reinstatement and/or repair of such assets and/or
satisfaction of business interruption losses in
respect of which the relevant insurance claim was
made (or to refinance any expenditure incurred in
the replacement, reinstatement and/or repair of
such assets and/or the satisfaction of business
interruption losses) within 365 days of the receipt
of such Net Proceeds,
are (without double counting and, for the avoidance of
doubt, in the case of (b) above, to the extent the
relevant Net Proceeds have not already been applied in
accordance with Clause 9.3 (Mandatory Prepayment from
Insurance Proceeds)) paid to the Agent for application in
repayment of the Loan in accordance with Clause 9.6
(Application of Proceeds) unless the relevant member of
the UK Group can show to the satisfaction of the Agent
(acting reasonably) that:
(x) the aggregate of:
(A) the net disposal proceeds referred to
at (a) above in respect of disposals
made in the immediately preceding
twelve calendar month period; and
(B) the Net Proceeds referred to at (b)
above in respect of Asset Dispositions
(after deducting any net disposal
proceeds referred to at (A) above to
the extent such net disposal proceeds
constitute Net Proceeds referred to at
(b) above and after deducting any Net
Proceeds which represent proceeds
received from an insurance claim (but
without prejudice to Clause 9.3
(Mandatory Prepayment from Insurance
Proceeds)) made by members of the UK
Group, any UK Group Excluded Subsidiary
(other than any member of the NTL
Triangle Sub-Group), the Intermediate
Parent or any other Subsidiary of the
Parent which is a holding company of
the Borrower in the immediately
preceding twelve calendar month period,
does not exceed(pound)10,000,000 (or its
equivalent in other currencies); or
48
(y) the net proceeds are required to be, and are
actually, applied to the permanent cancellation
of commitments and/or repayment of outstandings
under the Senior Bank Credit Agreement (but only
to the extent that such net proceeds are
actually so applied).
9.2.2 The Banks hereby agree that, at any time following a
refinancing of the Exit Financing they shall consider any
amendments proposed by the Borrower to be made to
sub-clause 9.2.1 above, with a view to ensuring that the
terms of sub-clause 9.2.1 are no more onerous than the
mandatory prepayment from asset disposal provisions
contained in the documentation for such refinancing
provided that:
(a) if such mandatory prepayment from asset disposal
provisions contained in the documentation for
such refinancing are less onerous (in the opinion
of an Instructing Group, acting reasonably) than
those contained in sub-clause 9.2.1, then the
provisions of sub-clause 9.2.3 shall apply in
substitution of sub-clause 9.2.1;
(b) the Banks shall act reasonably when considering
any amendments proposed by the Borrower to be
made to sub-clause 9.2.1 and, for the avoidance
of doubt, amendments to sub-clause 9.2.1 may be
made by the Agent (on behalf of the Banks) with
the prior consent of an Instructing Group; and
(c) the documentation for any subsequent refinancing
of the initial refinancing of the New NTL Exit
Facility shall not contain more onerous mandatory
prepayment from asset disposal provisions than
those which are, at such time, applicable under
this Agreement.
9.2.3 At all times following the date upon which the Exit
Financing or any refinancing of the Exit Financing
referred to at sub-clause 9.3.2 has been repaid in full
other than by way of being refinanced by other
indebtedness or in the circumstances referred to at
paragraph (a) of sub-clause 9.2.2, the Borrower shall
ensure that the net proceeds of any disposal falling
within paragraph (g)(A) of the definition of Permitted
Disposals of any asset by any member of the UK Group are
applied in repayment of the Loan in accordance with Clause
9.6 (Application of Proceeds), unless the relevant member
of the UK Group can show to the satisfaction of the Agent
(acting reasonably) that:
(a) such disposal was on arms' length terms and the
net disposal proceeds are to be reinvested in
similar or like assets of a comparable or
superior quality or applied towards the UK
Group's Capital Expenditure within a period of
365 days from the date of receipt of such
proceeds by the relevant member of the UK Group;
(b) such disposal was on arms' length terms and in
the ordinary and usual course of business of such
member of the UK Group;
(c) the net disposal proceeds, when aggregated with
the net disposal proceeds received by members of
the UK Group in respect of disposals falling
within paragraph (g)(A) of the definition of
49
Permitted Disposals made in the immediately
preceding twelve calendar month period (excluding
the proceeds from disposals falling within
paragraph (a) or paragraph (b) above), does not
exceed (pound)10,000,000 (or its equivalent in
other currencies); or
(d) the net disposal proceeds are required to be, and
are actually, applied to the permanent
cancellation of commitments and/or repayment of
outstandings under the Senior Bank Credit
Agreement (but only to the extent that such net
disposal proceeds are actually so applied).
In the case of paragraph (a) above only, the net disposal
proceeds referred to therein will (unless the relevant
member of the UK Group can demonstrate to the
satisfaction of the Agent (acting reasonably) that such
amounts have been applied in accordance with the relevant
provisions of the Senior Bank Credit Agreement), be
deposited into the Prepayment Escrow Account and the
relevant member of the UK Group shall be entitled during
the 365 day period, to withdraw (or require the Borrower
to withdraw) sums from such account only to the extent
that it is able reasonably to demonstrate that such sums
will be reinvested or applied in accordance with the
provisions of paragraph (a) above. Any amounts not
reinvested as specified in paragraph (a) above during the
365 days period specified therein shall, except to the
extent that such amounts are applied to the permanent
cancellation of commitments and/or repayment of
outstandings under the Senior Bank Credit Agreement (but
only to the extent actually so applied) thereafter be
applied in repayment of the Loan in accordance with
Clause 9.6 (Application of Proceeds) of this Agreement.
9.2.4 For the purposes of this Clause 9.2 and Clause 9.3
(Mandatory Prepayment from Insurance Proceeds), "Net
Proceeds" and "Asset Disposition" shall each bear the
meaning given to such term in the Exit Financing Indenture
as set out in Appendix A (Change of Control and Asset
Disposition provisions of the Exit Financing Indenture) as
those definition may be amended from time to time provided
that no amendment to either of those definitions shall be
taken into account for the purposes of this Clause 9.2
until such time as the Agent shall have received a copy of
the amended definitions and such other information in
relation thereto as the Agent may reasonably request.
9.3 Mandatory Prepayment from Insurance Proceeds
The Borrower shall ensure that Insurance Proceeds (including for the
avoidance of doubt, Net Proceeds of any Asset Disposition (each as
defined in sub-clause 9.2.4 of Clause 9.2 (Mandatory Prepayment from
Asset Disposals)) received from an insurance claim) received by any
member of the UK Group above an aggregate minimum threshold of
Insurance Proceeds of (pound)10,000,000 (or its equivalent in other
currencies) (the "Minimum Threshold"), are paid to the Agent and
applied in repayment of the Loan in accordance with Clause 9.6
(Application of Proceeds) unless the Insurance Proceeds received
above the Minimum Threshold are:
9.3.1 promptly upon receipt applied in accordance with the
provisions of Clause 9.4 (Payment of Insurance Proceeds
into Prepayment Escrow Account); and
50
9.3.2 applied, to the satisfaction of the Agent, towards the
replacement, reinstatement and/or repair of the assets
and/or the satisfaction of business interruption losses in
respect of which the relevant insurance claim was made (or
to refinance any expenditure incurred in the replacement,
reinstatement and/or repair of such assets and/or the
satisfaction of business interruption losses) within a
period of 365 days from the date of receipt of such
Insurance Proceeds by the relevant member of the UK Group;
or
9.3.3 required to be, and are actually, applied to the permanent
cancellation of commitments and/or repayment of
outstandings under the Senior Bank Credit Agreement (but
only to the extent that such Insurance Proceeds are
actually so applied).
9.4 Payment of Insurance Proceeds into Prepayment Escrow Account
The Borrower shall ensure that to the extent that any Insurance
Proceeds to be applied in accordance with sub-clause 9.3.2 of Clause
9.3 (Mandatory Prepayment from Insurance Proceeds) are not deposited
in the prepayment escrow account established under the Senior Bank
Credit Agreement such Insurance Proceeds are deposited in the
Prepayment Escrow Account. The relevant member of the UK Group shall
be entitled, during the period of 365 days from its receipt of
Insurance Proceeds, to withdraw sums from the Prepayment Escrow
Account only to the extent that it is able to reasonably demonstrate
that such sums will be applied towards the replacement, reinstatement
and/or repair of the assets and/or the satisfaction of business
interruption losses in respect of which the relevant insurance claim
was made (or to refinance any expenditure incurred in the
replacement, reinstatement and/or repair of such assets). Any sums
not so withdrawn during such 365 day period shall thereafter be paid
to the Agent and applied in repayment of the Loan in accordance with
Clause 9.6 (Application of Proceeds).
9.5 Mandatory Prepayment from Capital Event Proceeds
The Parent shall ensure that upon the receipt of Capital Event
Proceeds or in the event that a notice is delivered to the Agent
pursuant to the proviso at the end of the definition of "Capital
Event Proceeds", upon expiry of the notice period referred to in such
proviso, an amount equal to the Capital Event Proceeds Amount as then
determined is applied in repayment of the Loan in accordance with
Clause 9.6 (Application of Proceeds).
9.6 Application of Proceeds
9.6.1 Any amounts required to be applied in repayment of the
Loan pursuant to Clause 9.1 (Mandatory Prepayment From
Excess Cash Flow) to Clause 9.5 (Mandatory Prepayments
from Capital Event Proceeds) shall be applied (subject to
the provisions of Clause 23.4 (Break Costs)) in immediate
repayment of the Loan then outstanding.
9.6.2 Any amounts required to be paid into the Prepayment Escrow
Account in accordance with Clause 9.1 (Mandatory
Prepayment from Excess Cash Flow) to Clause 9.5 (Mandatory
Prepayment from Capital Event Proceeds) shall be paid to
the Agent for immediate deposit into the Prepayment Escrow
Account and shall be:
51
(a) retained in the Prepayment Escrow Account pending
any withdrawal permitted by any of those Clauses;
and
(b) to the extent not withdrawn as permitted under
and within the time frames stipulated in any of
those Clauses, upon expiry of the relevant time
frame, be applied in accordance with Clause 9.6.1
or if the Borrower so instructs the Agent, in
repayment of the Loan on one or more dates for
the payment of interest under Clause 4.1 (Payment
of Interest) until such time as such amounts have
been applied in full in repayment of the Loan in
accordance with this Clause 9.6, provided that
any such dates for the payment of interest as
aforesaid shall fall no later than six months
after the date on which those sums were
originally credited to the Prepayment Escrow
Account.
9.7 Mandatory Prepayment due to Change in Control
9.7.1 If after the Plan Effective Date:
(a) any person, or group of connected persons (which
does not have control on the Plan Effective Date)
acquires control of New NTL provided that for the
avoidance of doubt, any change of control
occurring by reason of the issuance by New NTL of
the New NTL Common Stock pursuant to the Plan
shall not constitute a change of control for the
purposes of this sub-clause 9.7.1 of this Clause
9.7; or
(b) any Obligor (other than New NTL) ceases to be
(directly or indirectly) a wholly-owned
subsidiary of New NTL; or
(c) but prior to any Permitted Refinancing of the
Exit Financing, any Change of Control occurs
under the Exit Financing Indenture (unless such
Change of Control is the subject of a waiver (but
not, for the avoidance of doubt, a forebearance)
by the requisite percentage or, as the case may
be, number of holders of the notes issued
pursuant to the Exit Financing Indenture
sufficient to bind all of such holders of such
notes) and/or any Change of Control Offer is
made; or
(d) following any Permitted Refinancing of the Exit
Financing, any party to the documentation
constituting such Permitted Refinancing becomes
entitled to declare any indebtedness under such
Permitted Refinancing due and payable prior to
its specified maturity, or any such indebtedness
becomes so due and payable, in either case, by
reason of any change of control (howsoever
expressed or defined in such documentation
constituting such Permitted Refinancing) in
respect of New NTL (unless such change of control
is the subject of a waiver (but not, for the
avoidance of doubt, a forebearance) by the
requisite percentage or, as the case may be,
number of creditors under such documentation
constituting such Permitted Refinancing),
then the Borrower shall procure the immediate repayment of
the Loan in full (together with accrued interest thereon
and any other sums then owed by the Borrower hereunder).
52
9.7.2 For the purposes of paragraphs (a) and (b) of sub-clause
9.7.1 above:
"Change of Control" and "Change of Control Offer" shall each
bear the meaning given to such term in the Exit Financing
Indenture as set out in Appendix A (Change of Control and
Asset Disposition provisions of the Exit Financing
Indenture) or as such definition in the Exit Financing
Indenture may be amended from time to time.
"control" means:
(a) the power (whether by way of ownership of shares,
proxy, contract, agency or otherwise) to:
(i) cast, or control the casting of, more than
one-half of the maximum number of votes
that might be cast at a general meeting of
New NTL; or
(ii) appoint or remove all, or the majority, of
the directors or other equivalent officers
of New NTL; or
(iii) give directions with respect to the
operating and financial policies of New
NTL which the directors or other
equivalent officers of New NTL are obliged
to comply with; or
(b) the holding of more than one-half of the issued
share capital of New NTL (excluding any part of
that issued share capital that carries no voting
rights or right).
"group of connected persons" means, a group of persons who,
pursuant to an agreement or understanding (whether formal or
informal), actively co-operate, through the acquisition by
any of them, either directly or indirectly, of shares in New
NTL, to obtain or consolidate control of New NTL.
9.7.3 This Clause 9.7 (Mandatory Prepayment due to Change in
Control) will not apply and the Loan will not become due and
payable in the event that any company acquires control of
New NTL as part of a solvent reorganisation of the Group on
terms approved by the Agent (acting on the instructions of
an Instructing Group).
10. TAXES
10.1 Tax Gross-up
All payments to be made by an Obligor to any Finance Party under the
Finance Documents shall be made free and clear of and without
deduction for or on account of tax unless such Obligor is required by
law to make such a payment subject to the deduction or withholding of
tax, in which case the sum payable by such Obligor (in respect of
which such deduction or withholding is required to be made) shall,
subject to Clause 10.6 (Excluded Claims), be increased to the extent
necessary to ensure that such Finance Party receives a sum net of any
deduction or withholding equal to the sum which it would have
received had no such deduction or withholding been made or required
to be made.
53
10.2 Tax Indemnity
Without prejudice to Clause 10.1 (Tax Gross-up), if the Agent or (as
a result of the introduction of, or change in or in the
interpretation, administration or application of, any law or
regulation or order or governmental rule or double taxation agreement
or any published practice or concession of any relevant taxing
authority after the Restatement Amendment Effective Date hereof) any
Bank (a) is required to make any payment of or on account of tax on
or in relation to any sum received or receivable under the Finance
Documents (including any sum deemed for purposes of tax to be
received or receivable by such Finance Party whether or not actually
received or receivable) or (b) has any liability in respect of any
such payment asserted, imposed, levied or assessed against it, the
relevant Obligor shall, within five Business Days of demand by the
Agent, promptly indemnify the Agent or Bank which suffers a loss or
liability as a result against such payment or liability, together
with any interest, penalties, costs and expenses payable or incurred
in connection therewith, provided that this Clause 10.2 shall not
apply to:
10.2.1 any tax imposed on and calculated by reference to the net
income, profits or gains actually received or receivable
by the Agent or such Bank (but, for the avoidance of
doubt, not including any sum deemed for purposes of tax to
be received or receivable by the Agent or such Bank but
not actually receivable) by the jurisdiction in which the
Agent or such Bank is incorporated or, if different, the
jurisdiction (or jurisdictions) in which the Agent or such
Bank is treated as resident for tax purposes (but
excluding any such tax that would not have arisen but for
such Agent or Bank, as the case may be, being treated as a
resident in a jurisdiction solely by reason of having
entered into this Agreement, performed its obligations or
received any payment hereunder or enforced its rights
hereunder); or
10.2.2 any tax imposed on and calculated by reference to the net
income, profits or gains of the Facility Office of the
Agent or such Bank actually received or receivable by the
Agent or such Bank (but, for the avoidance of doubt, not
including any sum deemed for purposes of tax to be
received or receivable by the Agent or such Bank but not
actually receivable) by the jurisdiction in which its
Facility Office is located; or
10.2.3 any tax imposed on the Agent, as a result of the failure
by a Bank to satisfy on the due date of a payment of
interest either of the conditions set out in sub-clauses
10.3.1 and 10.3.2 of Clause 10.3 (Banks' Tax Status
Confirmation); or
10.2.4 for the avoidance of doubt, any tax imposed on a Bank
which would not have arisen but for the sub-participation
of its rights and benefits under any of the Finance
Documents.
10.3 Banks' Tax Status Confirmation
Each Bank confirms in favour of the Agent (on the date hereof or, in
the case of a Bank which becomes a party hereto pursuant to a
transfer or assignment, on the date on which the relevant transfer or
assignment becomes effective) that either:
54
10.3.1 it is not resident for tax purposes in the United Kingdom
and is beneficially entitled to its share of the Loan and
the interest thereon; or
10.3.2 it is a bank as defined for the purposes of Section 349 of
ICTA and is beneficially entitled to its share of the Loan
and the interest thereon,
and each Bank shall promptly notify the Agent if there is any change
in its position from that set out above.
10.4 U.S. Tax Forms
Each Bank that is not a United States person (as such term is defined
in Section 7701(a)(30) of the Internal Revenue Code) for U.S. federal
income tax purposes agrees to deliver to the Borrower and the Agent
on or prior to the Initial Advance Date, or in the case of a Bank
that is an assignee or transferee of an interest under this Agreement
pursuant to Clause 30.3 (Assignment and Transfers by Banks) (unless
the respective Bank was already a Bank hereunder immediately prior to
such assignment or transfer), on the date of such assignment or
transfer to such Bank, (i) two accurate and complete original signed
copies of Internal Revenue Service Form W-8ECI or Form W-8BEN (with
respect to a complete exemption under an income tax treaty) (or
successor forms) certifying to such Bank's entitlement as of such
date to a complete exemption from United States withholding tax with
respect to payments to be made under this Agreement, or (ii) if the
Bank is not a "bank" within the meaning of Section 881(c)(3)(A) of
the Code and cannot deliver either Internal Revenue Service Form
W-8ECI or Form W-8BEN (with respect to a complete exemption under an
income tax treaty) pursuant to clause (i) above, (x) a certificate
substantially in the form of Schedule 8 (any such certificate, a
"Non-Bank Certificate") and (y) two accurate and complete original
signed copies of Internal Revenue Service Form W-8BEN (with respect
to the portfolio interest exemption) (or successor form) certifying
to such Bank's entitlement to a complete exemption from United States
withholding tax with respect to payments of interest to be made under
this Agreement. In addition, each Bank agrees that from time to time
after the Initial Advance Date, upon the reasonable request of the
Borrower or when a change in circumstances of the Bank renders the
previous certification obsolete or inaccurate in any material
respect, it will deliver to the Borrower and the Agent two new
accurate and complete original signed copies of Internal Revenue
Service W-8ECI or Form W-8BEN (with respect to the benefits of any
income tax treaty), or Form W-8BEN (with respect to the portfolio
interest exemption) and a Non-Bank Certificate, as the case may be,
and such other forms as may be required in order to confirm or
establish the entitlement as of such date of such Bank to a continued
exemption from or (as a result of a change in law, treaty, rule,
regulations, guideline or order, or in the interpretation thereof)
reduction in United States withholding tax with respect to payments
under this Agreement, or it shall notify the Borrower and the Agent
of its inability to deliver any such Form or Certificate, in which
case such Bank shall not be required to deliver any such Form or
Certificate pursuant to this Clause 10.4. Notwithstanding anything to
the contrary contained in Clause 10.1 (Tax Gross-up), but subject to
Clause 10.5 (Claims by Banks and the Agent) and the immediately
succeeding sentence, (x) the Borrower shall be entitled, to the
extent it is required to do so by law, to deduct or withhold income
or similar taxes imposed by the United States (or any political
subdivision or taxing authority thereof or therein) from interest,
fees or other amounts payable hereunder for the account of any Bank
which is not a United States person (as such term is
55
defined in Section 7701(a)(30) of the Code) for U.S. federal income
tax purposes to the extent that such Bank has not provided to the
Borrower U.S. Internal Revenue Service Forms that establish a
complete exemption from such deduction or withholding and (y) the
Borrower shall not be obligated pursuant to Clause 10.1 to gross-up
payments to be made to a Bank in respect of income or similar taxes
imposed by the United States if (I) such Bank has not provided to the
Borrower the Internal Revenue Service Forms required to be provided
to the Borrower pursuant to this Clause 10.4 or (II) in the case of a
payment, other than interest that is treated as interest for U.S.
federal income tax purposes, to a Bank described in clause (ii)
above, to the extent that such Forms do not establish a complete
exemption from withholding of such taxes. Notwithstanding anything to
the contrary contained in the preceding sentence or elsewhere in this
Clause 10.4, the Borrower agrees to pay any additional amounts and to
indemnify each Bank in the manner set forth in Clause 10.1 (Tax
Gross-up) in respect of any United States taxes deducted or withheld
by it as described in the immediately preceding sentence as a result
of any changes that are effective after the Initial Advance Date in
any applicable law, treaty, governmental rule, regulation, guideline
or order, or in the interpretation thereof, relating to the deducting
or withholding of such taxes.
10.5 Claims by Banks and the Agent
A Bank intending to make a claim pursuant to Clause 10.2 (Tax
Indemnity) shall notify the Agent of the event giving rise to the
claim, whereupon the Agent shall notify the Borrower thereof. If the
Agent intends to make a claim pursuant to Clause 10.2 (Tax Indemnity)
it shall notify the Borrower of the event giving rise to the claim.
10.6 Excluded Claims
If any Finance Party is not or ceases to be a Qualifying Lender, no
Obligor shall be liable to pay to that Finance Party under Clause
10.1 (Tax Gross-Up) any amount in respect of taxes levied or imposed
by the United Kingdom in excess of the amount it would have been
obliged to pay if that Finance Party had been or had not ceased to be
a Qualifying Lender provided that this Clause 10.6 shall not apply
(and each Obligor shall be obliged to comply with its obligations
under Clause 10.1 (Tax Gross-Up)) if:
10.6.1 after the Execution Date, there shall have been any
introduction of, or change in or in the interpretation,
administration or application of, any law or regulation or
order or governmental rule or double taxation agreement or
any published practice or concession of any relevant
taxing authority and as a result thereof such Finance
Party ceases to be a Qualifying Lender; or
10.6.2 such Finance Party is not or ceases to be a Qualifying
Lender as a result of the actions of any Obligor.
10.7 Treaty Lenders
A Treaty Lender and each Obligor which makes a payment to which that
Treaty Lender is entitled shall co-operate in completing any
procedural formalities necessary for that Obligor to obtain
authorisation to make that payment without a deduction or withholding
for or on account of tax imposed by the United Kingdom. If an Obligor
is able to demonstrate that a deduction or withholding for or on
account of tax imposed by the United Kingdom is required to be made
by it as a result of a Treaty
56
Lender's failure to so co-operate, such an Obligor shall not be
liable to pay any increased amount under Clause 10.1 (Tax Gross-Up)
as a result of such a deduction or withholding.
10.8 Notification of Status
Each Bank shall notify the Agent if it is not a Qualifying Lender at
the time it becomes a Bank hereunder and shall promptly notify the
Agent if at any time thereafter it ceases to be a Qualifying Lender.
The Agent shall promptly notify the Borrower of any notices it
receives under this Clause 10.8.
11. TAX RECEIPTS
11.1 Notification of Requirement to Deduct Tax
If, at any time, an Obligor is required by law to make any deduction
or withholding from any sum payable by it under the Finance Documents
(or if thereafter there is any change in the rates at which or the
manner in which such deductions or withholdings are calculated), such
Obligor and the Bank to which such sum is payable shall promptly upon
becoming aware of such a requirement notify the Agent accordingly. If
the Agent receives such a notification from a Bank it shall promptly
notify the Borrower and the Obligor who is required to make such a
deduction or withholding.
11.2 Evidence of Payment of Tax
If an Obligor makes any payment under the Finance Documents in
respect of which it is required to make any deduction or withholding,
it shall pay the full amount required to be deducted or withheld to
the relevant taxation or other authority within the time allowed for
such payment under applicable law and shall request and, within
thirty days of it receiving the same, deliver to the Agent for each
Bank an original receipt (or a certified copy thereof) issued by such
authority evidencing the payment to such authority of all amounts so
required to be deducted or withheld in respect of that Bank's share
of such payment.
11.3 Tax Credit Payment
If an additional payment is made under Clause 10 (Taxes) by an
Obligor or the Borrower for the benefit of any Finance Party and such
Finance Party, in its sole discretion, determines that it has
obtained (and has derived full use and benefit from) a credit
against, a relief or remission for, or repayment of, any tax, then,
if and to the extent that such Finance Party, in its sole opinion,
determines that such credit, relief, remission or repayment is in
respect of or calculated with reference to or otherwise relates to
the additional payment made pursuant to Clause 10 (Taxes), such
Finance Party shall, to the extent that it can do so without
prejudice to the retention of the amount of such credit, relief,
remission or repayment, pay to such Obligor or, as the case may be,
the Borrower such amount as such Finance Party shall, in its sole
opinion, determine to be the amount which will leave such Finance
Party (after such payment) in no worse after-tax position than it
would have been in had the additional payment in question not been
required to be made by such Obligor or the Borrower.
57
11.4 Tax Credit Clawback
If any Finance Party makes any payment to an Obligor or the Borrower
pursuant to Clause 11.3 (Tax Credit Payment) and such Finance Party
subsequently determines, in its sole opinion, that the credit,
relief, remission or repayment in respect of which such payment was
made was not available or has been withdrawn or that it was unable to
use such credit, relief, remission or repayment in full, such Obligor
or the Borrower shall reimburse such Finance Party such amount as
such Finance Party determines, in its sole opinion, is necessary to
place it in the same after-tax position as it would have been in if
such credit, relief, remission or repayment had been obtained and
fully used and retained by such Finance Party.
11.5 Tax and Other Affairs
Subject to Clause 10.7 (Treaty Lenders), no provision of this
Agreement shall interfere with the right of any Finance Party to
arrange its tax or any other affairs in whatever manner it thinks
fit, oblige any Finance Party to claim any credit, relief, remission
or repayment in respect of any payment under Clause 10 (Taxes) in
priority to any other credit, relief, remission or repayment
available to it nor oblige any Finance Party to disclose any
information relating to its tax or other affairs or any computations
in respect thereof.
12. INCREASED COSTS
12.1 Increased Costs
If, by reason of the occurrence, in each case after the Execution
Date, of (a) any change in law or in its interpretation or
administration and/or (b) compliance with any such new law or with
any request or requirement relating to the maintenance of capital or
any other request from or requirement of any central bank or other
fiscal, monetary or other authority (in each case, where a request or
requirement that does not have the force of law is a request or
requirement with which financial institutions subject to such request
or requirement are generally accustomed to comply):
12.1.1 a Bank or any holding company of such Bank is unable to
obtain the rate of return on its capital which it would
have been able to obtain but for such Bank's entering into
or assuming or maintaining a commitment or performing its
obligations under the Finance Documents;
12.1.2 a Bank or any holding company of such Bank incurs a cost
as a result of such Bank's entering into or assuming or
maintaining a commitment or performing its obligations
under the Finance Documents; or
12.1.3 there is any increase in the cost to a Bank or any holding
company of such Bank of funding or maintaining such Bank's
share of the Advances or any Unpaid Sum,
then the Borrower shall, within three Business Days of a demand of
the Agent, pay to the Agent for the account of that Bank amounts
sufficient to indemnify that Bank or to enable that Bank to indemnify
its holding company from and against, as the case may be, (i) such
reduction in the rate of return of capital, (ii) such cost or (iii)
such increased cost.
58
12.2 Increased Costs Claims
A Bank intending to make a claim pursuant to Clause 12.1 (Increased
Costs) shall notify the Agent of the event giving rise to such claim,
whereupon the Agent shall notify the Borrower thereof.
12.3 Exclusions
Notwithstanding the foregoing provisions of this Clause 12 (Increased
Costs), no Bank shall be entitled to make any claim under this Clause
12 (Increased Costs) in respect of any reduction in the rate of
return on capital, cost or increased cost:
12.3.1 attributable to a deduction or withholding for or on
account of tax from a payment under a Finance Document
required by law to be made by an Obligor and compensated
for pursuant to the provisions of Clause 10.1 (Tax
Gross-Up) (or would have been compensated for under Clause
10.1 (Tax Gross-Up) but was not so compensated solely
because of Clause 10.4 (U.S. Tax Forms), Clause 10.6
(Excluded Claims) or Clause 10.7 (Treaty Lenders));
12.3.2 compensated by Clause 10.2 (Tax Indemnity) (or would have
been compensated for under Clause 10.2 (Tax Indemnity) but
was not so compensated solely because of one of the
exclusions set out in sub-clauses 10.2.1 to 10.2.4 of
Clause 10.2 (Tax Indemnity));
12.3.3 compensated by the Mandatory Cost Rate; or
12.3.4 attributable to the wilful breach by the relevant Finance
Party or its affiliates of any law or regulation.
13. ILLEGALITY
If, at any time, it is or will become unlawful for a Bank to make,
fund or allow to remain outstanding all or part of its share of the
Advances, then that Bank shall, promptly after becoming aware of the
same, deliver to the Borrower through the Agent a notice to that
effect and if the Agent on behalf of such Bank so requires, the
Borrower shall no later than the last day permitted by law repay such
Bank's share of any outstanding Advances together with accrued
interest thereon and all other amounts owing to such Bank under the
Finance Documents.
14. MITIGATION
If, in respect of any Bank, circumstances arise which would or would
upon the giving of notice result in:
14.1.1 an increase in any sum payable to it or for its account
pursuant to Clause 10.1 (Tax Gross-up);
14.1.2 a claim for indemnification pursuant to Clause 10.2 (Tax
Indemnity) or Clause 12.1 (Increased Costs); or
14.1.3 any repayment to be made pursuant to Clause 13
(Illegality),
59
then, without in any way limiting, reducing or otherwise qualifying
the rights of such Bank or the obligations of the Obligors under any
of the Clauses referred to above, such Bank shall promptly upon
becoming aware of such circumstances notify the Agent thereof and, in
consultation with the Agent and the Borrower and to the extent that
it can do so lawfully, take reasonable steps (including a change of
location of its Facility Office or the transfer of its rights,
benefits and obligations under the Finance Documents to another
financial institution acceptable to the Borrower and willing to
participate in the Facility) to mitigate the effects of such
circumstances, provided that such Bank shall be under no obligation
to take any such action if, in the opinion of such Bank, to do so
might have any adverse effect upon its business, operations or
financial condition (other than any minor costs and expenses of an
administrative nature).
15. REPRESENTATIONS
15.1 Historic Representations
Each of the Obligors (other than the Parent) made the representations
and warranties specified in Schedule 9 (Historic Representations) at
the times specified as having been made by it therein.
15.2 Representing Parties
15.2.1 On the date of the Restatement Amendment Agreement, each
Covenant Group Obligor makes the representations and
warranties set out in Clause 15.4 (Status and Due
Authorisation) to Clause 15.8 (No Material Proceedings)
and Clause 15.10 (Budgets) to Clause 15.13 (Security
Interest) and Clause 15.15 (Existing Group Indebtedness)
with respect to itself.
15.2.2 On the date of the Restatement Amendment Agreement:
(a) New NTL makes the representations and warranties
set out in Clause 15.4 (Status and Due
Authorisation), Clause 15.6 (Binding
Obligations), Clause 15.11 (Execution of the
Finance Documents) and Clause 15.13 (Security
Interest) with respect to itself; and
(b) the Borrower makes the representations and
warranties set out in Clause 15.9 (Audited
Financial Statements).
15.2.3 On the Plan Effective Date, each of New NTL and the Parent
makes the representations and warranties set out in Clause
15.5 (No Immunity) with respect to itself and the Borrower
makes the representation and warranty set out in Clause
15.14 (Group Structure).
15.3 Reliance on Representations and Warranties
Each Obligor acknowledges that the Finance Parties have entered into
the Finance Documents in reliance on those representations and
warranties referred to at Clause 15.1 (Historic Representations) and
Clause 15.2 (Representing Parties).
60
15.4 Status and Due Authorisation
It is duly organised under the laws of the jurisdiction in which it
is established or incorporated with power to enter into each of the
Finance Documents to which it is a party and to exercise its rights
and perform its obligations thereunder and all corporate and other
action required to authorise its execution of each of the Finance
Documents to which it is a party and its performance of its
obligations thereunder has been duly taken. No limit on its powers
will be exceeded as a result of the borrowings, granting of security
or giving of guarantees contemplated by the Finance Documents to
which it is a party.
15.5 No Immunity
In any proceedings taken in the jurisdiction in which it is
incorporated or established in relation to any Finance Document to
which it is party, it is not entitled to claim for itself or any of
its assets immunity from suit, execution, attachment or other legal
process.
15.6 Binding Obligations
The obligations expressed to be assumed by it in each Finance
Document to which it is expressed to be a party are legal and valid
obligations and (subject to the Reservations) binding on it and
enforceable against it in accordance with the terms thereof.
15.7 No Material Defaults
No member of the Covenant Group is in breach of or in default under
any agreement to which it is a party (including, without limitation,
Material Commercial Contracts) or which is binding on it or any of
its assets and no party has terminated or is entitled to terminate
(on the basis of any breach of or default thereunder) any such
agreement to an extent or in a manner which could reasonably be
expected to have a Material Adverse Effect.
15.8 No Material Proceedings
No action or administrative proceeding of or before any court,
arbitrator or agency (including, without limitation, investigative
proceedings) which could reasonably be expected to have a Material
Adverse Effect has been started or threatened against any member of
the Covenant Group or any of their respective assets.
15.9 Audited Financial Statements
The most recent consolidated audited financial statements of New NTL
and of the UK Group:
15.9.1 were prepared in accordance with accounting principles
generally accepted in its jurisdiction of incorporation
and consistently applied;
15.9.2 disclose all material liabilities (contingent or
otherwise) and all material unrealised or anticipated
losses of any member of the Group in the case of New NTL's
consolidated financial statements (to the extent required
to be
61
disclosed by generally accepted accounting
principles in the United States of America) or, the UK
Group, in the case of the Borrower's consolidated
financial statements of the UK Group (to the extent
required to be disclosed by generally accepted accounting
principles in the United Kingdom); and
15.9.3 save as disclosed therein, fairly present in all material
respects, the financial condition, results of operations
and cash flows of the Group in the case of New NTL's
consolidated financial statements and give a true and fair
view of the financial condition and operations of the UK
Group in the case of the Borrower's consolidated financial
statements of the UK Group, during the relevant financial
year.
15.10 Budgets
It:
15.10.1 regards (as at the date each Budget is delivered to the
Agent) as neither unreasonable, nor to any material extent
unattainable, any of the forecasts or projections set out
in the latest Budget delivered under Clause 16.6
(Budgets); and
15.10.2 believes (having made all reasonable enquiries) the
assumptions, upon which the forecasts and projections
contained in the latest Budget delivered under Clause 16.6
(Budgets) are based, to be fair and reasonable.
15.11 Execution of the Finance Documents
Its execution of each Finance Document to which it is a party and the
performance of its obligations thereunder do not and will not:
15.11.1 conflict with any agreement, mortgage, bond or other
instrument or treaty to which it is party or which is
binding upon it or any of its assets in a manner that
could reasonably be expected to have a Material Adverse
Effect;
15.11.2 conflict with its constitutive documents and rules and
regulations; or
15.11.3 conflict with any applicable law.
15.12 Intellectual Property
It is not aware of any adverse circumstance relating to the validity,
subsistence or use of any member of the Covenant Group's Intellectual
Property which could reasonably be expected to have a Material
Adverse Effect.
15.13 Security Interest
15.13.1 Subject (in each case) to the Reservations, each Security
Document creates, or shall create, on and with effect from
the Plan Effective Date the security interest which that
Security Document purports to create or, if that Security
Document purports to evidence a security interest,
accurately evidences a security interest which has been
validly created and each security interest ranks in
priority (save in respect of, if and to the extent
applicable, Permitted
62
Encumbrances) as specified in the Security Document
creating or evidencing that interest.
15.13.2 The shares of Intermediate Parent and the Borrower which
are subject to an Encumbrance under the Security Documents
are fully paid and not subject to any option to purchase
or similar rights and the constitutional documents of such
persons do not and could not restrict or inhibit (whether
absolutely, partly, under a discretionary power or
otherwise) any transfer of such shares pursuant to
enforcement of the Security Documents.
15.14 Group Structure
Each of:
15.14.1 the corporate structure of the Parent Covenant Group and
the UK Group set out in the Group Structure Chart
delivered under the Restatement Amendment Agreement as a
condition precedent to the Restatement Amendment Effective
Time is true, complete and accurate, as of the Plan
Effective Date; and
15.14.2 the corporate structure of the Parent Covenant Group and
the UK Group set out in any Group Structure Chart
delivered from time to time to the Agent pursuant to
Clause 18.28 (Revised Group Structure) is true, complete
and accurate, in each case as at the date of its delivery
to the Agent.
15.15 Existing Group Indebtedness
15.15.1 The Intermediate Parent owes no Financial Indebtedness to
any other members of the Group, other than:
(i) the Parent; and
(ii) Financial Indebtedness owed under or in connection
with the NTL Delaware Subordinated Note or any
refinancing thereof constituting Permitted
Indebtedness under paragraph (q) of the definition
of such term.
15.15.2 The Borrower owes no Financial Indebtedness to any members
of the Group, other than the Intermediate Parent.
15.16 Repetition of Representations
The Repeated Representations shall be deemed to be repeated by each
of the Obligors to the extent they are identified as giving such
Repeated Representation in sub-clauses 15.2.1 and 15.2.2 of Clause
15.2 (Representing Parties) at the Restatement Amendment Effective
Time.
15.17 Additional Representations on the Restatement Amendment Effective Time
Each of New NTL and the Borrower represents and warrants, and in the
case of sub-clause 15.17.2 (Disclosure of Information) each Obligor
also represents and warrants, at the Restatement Amendment Effective
Time that:
63
15.17.1 Tax Consequences of Restructuring: The recapitalisation
and restructuring of the Group as contemplated in the Plan
does not have any material and adverse tax implications
for the Covenant Group (or any member thereof), other than
to the extent specifically disclosed at paragraph 4 (Loss
of NOLs) of Section X.D (Certain Bankruptcy
Considerations) of the Disclosure Statement or as
disclosed to the Agent in writing on or prior to the
Restatement Amendment Effective Time;
15.17.2 Disclosure of Information: To the best of its knowledge,
information and belief, having made all reasonable efforts
to make due and careful enquiry, it has made full
disclosure of all material facts and circumstances in
respect of the recapitalisation and restructuring of the
Group as contemplated in the Plan and all information so
disclosed is true, complete and accurate in all material
respects; and
15.17.3 Historic Financial Information: The historic financial
statements of the Group (excluding, for the avoidance of
doubt, any projections, or statements related to the
projections, contained or referenced therein) contained at
Exhibit E of the Disclosure Statement were prepared in
accordance with the books and records of the Group and in
compliance with United States Generally Accepted
Accounting Principles (except as noted therein or in the
notes thereto) and fairly present, in all material
respects, the financial condition, results of operations
and cash flows of the Group (or the relevant part of the
Group) in respect of the periods to which such financial
statements relate.
16. FINANCIAL INFORMATION
16.1 Annual Statements
As soon as the same become available, but in any event within 120
days after the end of each of the Borrower's or, as the case may be,
New NTL's financial years, the Borrower shall deliver to the Agent,
in sufficient copies for the Banks:
16.1.1 the consolidated financial statements of the Group for
such financial year, audited by an internationally
recognised firm of independent auditors; and
16.1.2 the consolidated financial statements of the UK Group for
such financial year, audited by an internationally
recognised firm of independent auditors licensed to
practice in England and Wales.
16.2 Quarterly Statements
As soon as the same become available, but in any event within 45 days
after the end of each Financial Quarter, the Borrower shall deliver
to the Agent, in sufficient copies for the Banks:
16.2.1 the unaudited consolidated financial statements of the
Group for such Financial Quarter save that in the case of
the last Financial Quarter of each financial year of New
NTL, the Borrower shall only be obliged to deliver to the
Agent the unaudited consolidated management accounts of
the Group for such period; and
64
16.2.2 the unaudited consolidated financial statements of the UK
Group for such Financial Quarter.
16.3 Financial Statements of the Borrower
To the extent that the same are requested by any Bank to enable it to
comply with any law or any requirement of any central bank or other
fiscal, monetary or other authority, the Borrower shall, upon the
request of the Agent, deliver to the Agent its most recent annual
financial statements which are in final form and which the Borrower
has prepared prior to such request (including any balance sheet and
profit and loss account if the same have been prepared) in order to
comply with any legal obligation on the Borrower to produce annual
financial statements. Any such annual financial statements shall be
delivered to the Agent within 30 days of such financial statements
being requested by the Agent provided that if its most recent
financial statements are in draft form and will not be in final form
within 30 days of the time of any such request, the Borrower shall
notify the Agent thereof together with details of when such financial
statements are likely to be in final form, and shall deliver the
final form financial statements as soon as reasonably practicable
thereafter.
16.4 Requirements as to Financial Statements
The Borrower shall ensure that:
16.4.1 each set of financial statements delivered by it pursuant
to sub-clause 16.1.1 of Clause 16.1 (Annual Statements)
and sub-clause 16.2.1 of Clause 16.2 (Quarterly
Statements) (other than in the case of unaudited
consolidated management statements of the Group for the
last Financial Quarter of each financial year of New NTL)
is certified by one of its Authorised Signatories as
fairly presenting, in all material respects, the financial
condition, results of operations and cash flows of the
Group in respect of the period to which those financial
statements relate, subject (in the case of any financial
statements delivered pursuant to sub-clause 16.2.1 of
Clause 16.2 (Quarterly Statements)) to changes resulting
from audit and normal year end adjustments;
16.4.2 each set of unaudited consolidated management accounts of
the Group for the last Financial Quarter of each year of
New NTL delivered by it pursuant to sub-clause 16.2.1 of
Clause 16.2 (Quarterly Statements) is certified by one of
the Borrower's Authorised Signatories as:
(a) having been prepared by the management of New NTL
with such degree of skill and care as might
reasonably be expected in the preparation of
management accounts; and
(b) correctly showing (within the confines of the
information contained in such unaudited
consolidated management accounts) the understanding
of the management of New NTL of the financial
condition of the Group as at the end of the period
to which those unaudited consolidated management
accounts relate and of the results of the Group's
operations during such period;
16.4.3 each set of financial statements delivered by it pursuant
to sub-clause 16.1.2 of Clause 16.1 (Annual Statements)
and sub-clause 16.2.2 of Clause 16.2
65
(Quarterly Statements) is certified by one of its Authorised
Signatories as giving a true and fair view of the
consolidated financial condition of the UK Group as at the
end of the period to which those financial statements
relate and of the results of the UK Group's operations
during such period, subject (in the case of any financial
statements delivered pursuant to sub-clause 16.2.2 of
Clause 16.2 (Quarterly Statements) to changes resulting
from audit and normal year end adjustments; and
16.4.4 each set of financial statements delivered by it pursuant
to sub-clause 16.1.2 of Clause 16.1 (Annual Statements)
(other than the consolidated financial statements
delivered pursuant to sub-clause 16.1.2 of Clause 16.1
(Annual Statements) in respect of the Borrower's financial
year ended 31 December 2002) and sub-clause 16.2.2 of
Clause 16.2 (Quarterly Statements) (other than the
consolidated financial statements delivered pursuant to
sub-clause 16.2.2 of Clause 16.2 (Quarterly Statements) in
respect of the Financial Quarter ended 31 December 2002)
is accompanied by a comparison to the projections in the
Budget for the financial year or, as the case may be,
Financial Quarter, to which those financial statements
relate.
16.5 Compliance Certificates
The Borrower shall ensure that:
16.5.1 each set of consolidated financial statements delivered by
it pursuant to Clause 16.1 (Annual Statements) (other than
the consolidated financial statements delivered pursuant
to Clause 16.1 (Annual Statements) in respect of the
Borrower's and New NTL's financial year ended 31 December
2002) or Clause 16.2 (Quarterly Statements) (other than
the consolidated financial statements delivered pursuant
to Clause 16.2 (Quarterly Statements) in respect of the
Financial Quarter ended 31 December 2002) is accompanied
by a Compliance Certificate signed by two of its
Authorised Signatories; and
16.5.2 each Compliance Certificate delivered by it after the
Restatement Amendment Effective Time, up to and including
the Compliance Certificate delivered in respect of the
sixth complete Financial Quarter which ends after the
Restatement Amendment Effective Time, shall be copied to
the Reporting Accountants.
In addition, the Borrower shall ensure that each Compliance
Certificate delivered by it after the Restatement Amendment Effective
Date has attached thereto the information specified in sub-clause
18.26.2 of Clause 18.26 (Transactions with Affiliates).
16.6 Budgets
The Borrower shall, as soon as the same become available, and in any
event no later than 60 days after the beginning of each of its
financial years, deliver to the Agent in sufficient copies for the
Banks an annual budget (in a form agreed with the Agent) prepared by
reference to each Financial Quarter in respect of such financial year
including:
16.6.1 forecasts of projected disposals (including timing and
amount thereof) on a consolidated basis of the UK Group
for such financial year;
66
16.6.2 projected annual profit and loss accounts (including
projected turnover and operating costs) and projected
balance sheets and cash flow statements, together with the
main operating assumptions relating thereto, on a
quarterly basis, for such financial year on a consolidated
basis for the UK Group;
16.6.3 revisions to the projections set out in the Updated
Business Plan, together with the main operating
assumptions relating thereto, for such financial year
until the Final Maturity Date, based on the financial
condition and performance and prospects of the UK Group at
such time;
16.6.4 projected Permitted Payments to be made during such
financial year and the (in respect of paragraph (a) of the
definition of Permitted Payments) related Financial
Indebtedness of the relevant member of the Parent Covenant
Group to which those Permitted Payments will relate;
16.6.5 Capital Expenditure projected to accrue on a quarterly
basis for such financial year on a consolidated basis for
the UK Group;
16.6.6 projected EBIT and EBITDA as at the end of each Financial
Quarter in such financial year, for the UK Group; and
16.6.7 a qualitative analysis and commentary from the management
on its proposed activities for such financial year.
The Borrower shall provide the Agent with details of any material
changes in the projections delivered under this Clause 16.6 as soon
as reasonably practicable after it becomes aware of any such change.
16.7 Information for Reporting Accountants to prepare Monthly Performance
Update Report
16.7.1 The Borrower shall, and the Borrower shall (to the extent
necessary) procure that each member of the UK Group shall
(to the extent necessary) ensure that each member of the
Extended UK Group shall, provide the Reporting Accountants
with:
(a) by no later than the last Business Day of the
calendar month which succeeds the month (the
"relevant month") with respect to which any
Monthly Performance Update Report is to be
prepared, a report on the performance of the
Extended UK Group during such relevant month,
such report to include the Required Monthly
Information for such month;
(b) as soon as reasonably practicable after receipt
of any reasonable request, from the Reporting
Accountants for further particulars in relation
to the Required Monthly Information, such further
particulars; and
(c) as soon as reasonably practicable after receipt
of any request, access to, and permission to
inspect, the assets, books, records and premises
of the Borrower and each member of the Group, in
each case to the extent reasonably requested by
the Reporting Accountants in order to
67
enable the Reporting Accountants to prepare the
Monthly Performance Update Report within the time
periods set out in the Reporting Accountants
Mandate Letter.
16.7.2 The Borrower shall procure that each of the Borrower and
NTL Investment Holdings Limited complies with their
respective payment obligations under the Reporting
Accountants Mandate Letter, in the amounts specified
therein in each case, within 21 days of such payment
obligations arising.
16.7.3 The obligations of the Obligors under this Clause 16.7
shall continue until such time as the Agent (acting on the
instructions of an Instructing Group) determines that the
Monthly Performance Update Reports are no longer necessary
provided that, without prejudice to the foregoing, the
Agent will (in good faith) review the ongoing need for the
Monthly Performance Update Reports on the date falling 18
months after the Restatement Amendment Effective Date by
reference to the then current performance of the UK Group
and if the Agent (acting on the instructions of an
Instructing Group) informs the Borrower that the result of
such review is that there is no on-going need for Monthly
Performance Update Reports, no member of the Group shall
have any further obligations under this Clause 16.7.
16.7.4 The Banks hereby consent to the Reporting Accountants
providing a copy of each Monthly Performance Update Report
(with such deletions as the Reporting Accountants and/or
the Agent may deem appropriate) to the lenders under the
New NTL Exit Facility.
16.8 Hedging
The Borrower will promptly:
16.8.1 notify the Agent upon either it or any member of the UK
Group entering into any Hedging Agreement; and
16.8.2 notify the Agent of any amendments made to the Hedging
Strategy from time to time.
16.9 Asset Passthroughs and Funding Passthroughs
The Borrower shall, at least five Business Days prior to effecting
either an Asset Passthrough or a Funding Passthrough provide the
Agent with:
16.9.1 written notice of the proposed Asset Passthrough or
Funding Passthrough;
16.9.2 a summary of the steps to be implemented in connection
with the proposed Asset Passthrough or Funding
Passthrough;
16.9.3 a certificate from an Authorised Signatory of the
Borrower, confirming that the proposed Asset Passthrough
or Funding Passthrough will satisfy all of the
requirements of the definition thereof; and
16.9.4 such other information in relation to the proposed Asset
Passthrough or Funding Passthrough as the Agent may
reasonably request.
68
16.10 Other Financial Information
16.10.1 The Borrower shall ensure that the consolidated financial
statements delivered by it pursuant to Clause 16.1 (Annual
Statements) in respect of the Borrower's and New NTL's
financial years ended 31 December 2002 is accompanied by a
statement (for information purposes only) setting out the
financial condition and performance of the Group and the
UK Group for such financial year as if financial covenants
set out at Clause 17 (Financial Condition) were being
tested at such time.
16.10.2 Each Obligor shall and the Borrower shall procure that
each member of the UK Group shall from time to time on the
request of the Agent, furnish the Agent with such
information about the business, condition (financial or
otherwise), operations, performance, properties or
prospects of New NTL, the Parent and any member of the
Covenant Group as the Agent or any Bank (through the
Agent) may reasonably require, provided that no Obligor
shall be under any obligation to supply any information
the supply of which would be contrary to any
confidentiality obligation binding on it.
16.11 Accounting Policies
The Borrower shall ensure that:
16.11.1 each set of financial statements delivered pursuant to
Clause 16.1 (Annual Statements) and Clause 16.2 (Quarterly
Statements) (other than the consolidated management
accounts of the Group) is prepared using accounting
policies, practices, procedures and, in the case of annual
financial statements, accounting reference dates
consistent with those applied in the preparation of the
relevant Restatement Amendment Financial Statements; and
16.11.2 each set of unaudited consolidated management accounts of
the Group delivered pursuant to Clause 16.2 (Quarterly
Statements) is prepared on a basis consistent with the
basis agreed between New NTL and the Reporting Accountants
prior to the date of the Restatement Amendment Agreement
as the basis upon which the unaudited consolidated
management accounts of the Group will be prepared,
unless, in relation to any such set of financial statements, (other
than the unaudited consolidated management accounts of the Group),
the Borrower notifies the Agent that there have been one or more
changes in any such accounting policies, practices, procedures or
accounting reference dates or, in relation to any such set of
unaudited consolidated management accounts of the Group, the Borrower
notifies the Agent that there have been one or more changes in the
basis upon which such unaudited consolidated management accounts have
been prepared and:
(a) (save in respect of any change in the basis upon which
unaudited consolidated management accounts of the Group
were prepared) the auditors of New NTL or the Borrower, as
the case may be, provide:
(i) a description of the changes and the adjustments
which would be required to be made to those
financial statements in order
69
to cause them to use the accounting policies,
practices, procedures and, in the case of annual
financial statements, accounting reference dates
upon which the relevant Restatement Amendment
Financial Statements were prepared; and
(ii) sufficient information, in such detail and format
as may be reasonably required by the Agent, to
enable the Banks to make an accurate comparison
between the financial position indicated by those
financial statements and the relevant Restatement
Amendment Financial Statements,
in which case any reference in this Agreement to
those financial statements shall be construed as a
reference to those financial statements as
adjusted to reflect the basis upon which the
relevant Restatement Amendment Financial
Statements were prepared; or
(b) in respect of any change in the basis upon which unaudited
consolidated management accounts of the Group were
prepared, New NTL provides:
(i) a description of the changes and the adjustments
which would be required to be made to those
unaudited consolidated management accounts in
order to cause them to be prepared on the basis
agreed between New NTL and the Reporting
Accountant referred to at sub-clause 16.11.2 of
this Clause 16.11; and
(ii) sufficient information, in such detail and format
as may be reasonably required by the Agent, to
enable the Banks to make an accurate comparison
between the financial position indicated by those
unaudited consolidated management accounts and
the first set of unaudited consolidated
management accounts delivered pursuant to Clause
16.2 (Quarterly Statements) after the date of the
Restatement Amendment Agreement,
in which case any reference in this Agreement to
those unaudited consolidated management accounts
shall be construed as a reference to those
unaudited consolidated management accounts as
adjusted to reflect the basis upon which the
first set of unaudited consolidated management
accounts delivered pursuant to Clause 16.2
(Quarterly Statements) after the date of the
Restatement Amendment Agreement were prepared; or
(c) the Borrower notifies the Agent that it is no
longer practicable to test compliance with the
financial covenants set out in Clause 17.1 (UK
Group Financial Condition) in the case of the
Borrower and Clause 17.2 (Group Financial
Condition) in the case of New NTL, against the
financial statements received pursuant to this
Clause 16, in which case:
70
(i) the Agent and the Borrower shall enter
into negotiations with a view to agreeing
alternative financial covenants to
replace those contained in Clause 17.1
(UK Group Financial Condition) or Clause
17.2 (Group Financial Condition)
respectively in order to maintain a
consistent basis for such financial
covenants; and
(ii) if, after three months commencing on the
date of the notice given to the Agent
pursuant to this paragraph (c) of this
sub-clause 16.11.2, the Agent and the
Borrower cannot agree alternative
financial covenants which are acceptable
to an Instructing Group, the Agent shall
refer the matter to such internationally
recognised accounting firm as may be
agreed between the Borrower and an
Instructing Group for determination of
the adjustments required to be made to
such financial statements or the
calculation of such ratios to take
account of such change, such
determination to be binding on the
parties hereto, provided that pending
such determination the Borrower shall
continue to prepare financial statements
and calculate such ratios in accordance
with paragraphs (a) and (b) of this
sub-clause 16.11.2; and
(d) New NTL agrees that it shall be bound by (i) any
alternative financial covenants agreed between
the Agent and the Borrower pursuant to
sub-paragraph (i) of paragraph (c) of this
sub-clause 16.11.2 and (ii) any determination of
adjustments required to be made to financial
statements or any adjustment required to be made
to the financial covenants by an internationally
recognised accounting firm pursuant to
sub-paragraph (ii) of paragraph (c) of this
sub-clause 16.11.2.
16.12 General Information
The Borrower shall, as soon as reasonably practicable, furnish the
Agent with such general information as it or any member of the UK
Group is required by law to supply or make available to its (or such
member of the UK Group's) (a) shareholders (in their capacity as
such) or (b) creditors generally or any class thereof provided that
the Borrower shall not be required to furnish the Agent with such
general information which a member of the UK Group (other than the
Borrower) is required by law to supply to its shareholders (in their
capacity as such) for so long as such member of the UK Group is a
wholly-owned subsidiary of the Borrower unless a specific item of
information is requested by the Agent or any Bank (in which case such
item of information shall be furnished to the Agent).
16.13 Litigation and Government or Regulatory Enquiry
Each of New NTL and the Intermediate Parent (in each case, in respect
of itself) and the Borrower (in respect of itself and each other
member of the UK Group) shall advise the Agent forthwith of the
details of:
16.13.1 any litigation, arbitration or administrative proceedings
pending or threatened against it or, as the case may be,
any member of the UK Group which could reasonably be
expected to result in liability of it or, as the case
71
may be, such other member of the UK Group in an amount in
excess of (pound)5,000,000 (or its equivalent); and
16.13.2 any notice or communication received by it or, as the case
may be, any member of the UK Group from, or any actual or
potential enquiry, investigation or proceedings commenced
by, any government, court or regulatory agency or
authority, if such notice, communication, enquiry,
investigation or proceedings could reasonably be expected
to have a Material Adverse Effect.
16.14 New NTL's Obligations in respect of Group Financial Statements
16.14.1 New NTL shall deliver to the Borrower, the consolidated
financial statements of the Group for each of its
financial years, audited by an internationally recognised
firm of independent auditors, in sufficient time to enable
the Borrower to comply with its obligations under
sub-clause 16.1.1 of Clause 16.1 (Annual Statements); and
16.14.2 New NTL shall deliver to the Borrower, the unaudited
consolidated financial statements or, as the case may be,
unaudited consolidated management accounts of the Group
for each Financial Quarter in sufficient time to enable
the Borrower to comply with its obligations under
sub-clause 16.2.1 of Clause 16.2 (Quarterly Statements).
16.15 Delivery of Information to Banks
The Borrower may satisfy its obligation under this Agreement to
deliver sufficient copies of any document or information for the
Banks or to deliver any other information to the Banks by delivering
one copy of the relevant document or information to the Agent with a
request that the Agent deliver that document or information to the
Banks in the manner in which it deems most appropriate (including by
posting such information onto an electronic website designated by the
Agent for such purpose) if:
16.15.1 the Agent expressly agrees that it will accept one copy
only of the relevant document or information (and the
Agent hereby agrees to accept one copy of the documents
referred to in Clause 16.1 (Annual Statements), Clause
16.2 (Quarterly Statements) and Clause 16.6 (Budgets) for
the purposes of this Clause 16.15); and
16.15.2 the document or information is in a format previously
agreed between the Borrower and the Agent (and the Agent
hereby acknowledges that the format of the documents most
recently delivered prior to the date of the Restatement
Amendment Agreement pursuant to the equivalent of Clause
16.1 (Annual Statements), Clause 16.2 (Quarterly
Statements) and Clause 16.6 (Budgets) of the Principal
Credit Agreement (as defined in the Restatement Amendment
Agreement) are an agreed format for the purposes of this
Clause 16.15).
72
17. FINANCIAL CONDITION
17.1 UK Group Financial Condition
The Borrower shall ensure that the financial condition of the UK
Group shall be such that:
17.1.1 Ratio of UK Group Net Consolidated Total Debt to
Consolidated Annualised EBITDA of the UK Group
(a) The ratio of the UK Group Net Consolidated Total
Debt on each of the Quarter Dates specified in
column one below to the Consolidated Annualised
EBITDA of the UK Group for the Relevant Period ended
on that Quarter Date shall be no greater than the
ratio set out in column two below corresponding to
that Quarter Date.
-----------------------------------------------------------------------
Column One Column Two
Quarter Date UK Group Net Consolidated Total Debt:
Consolidated Annualised EBITDA of
the UK Group
-----------------------------------------------------------------------
31 March 2003 7.14:1
-----------------------------------------------------------------------
30 June 2003 7.18:1
-----------------------------------------------------------------------
30 September 2003 6.88:1
-----------------------------------------------------------------------
31 December 2003 6.43:1
-----------------------------------------------------------------------
31 March 2004 6.28:1
-----------------------------------------------------------------------
30 June 2004 6.13:1
-----------------------------------------------------------------------
30 September 2004 6.02:1
-----------------------------------------------------------------------
31 December 2004 5.79:1
-----------------------------------------------------------------------
31 March 2005 5.58:1
-----------------------------------------------------------------------
30 June 2005 5.32:1
-----------------------------------------------------------------------
30 September 2005 5.07:1
-----------------------------------------------------------------------
31 December 2005 4.82:1
-----------------------------------------------------------------------
Ratio of UK Group Net Consolidated Total Debt to
Consolidated EBITDA of the UK Group
(b) The ratio of UK Group Net Consolidated Total Debt on
each of the Quarter Dates specified in column one
below to the Consolidated EBITDA of the UK Group for
the financial year of the Borrower ended on that
Quarter Date shall be no greater than the ratio set
out in column two below corresponding to that
Quarter Date.
73
-----------------------------------------------------------------------
Column One Column Two
Quarter Date UK Group Net Total Debt:
Consolidated EBITDA
of the UK Group
-----------------------------------------------------------------------
31 December 2003 6.80:1
-----------------------------------------------------------------------
31 December 2004 5.95:1
-----------------------------------------------------------------------
31 December 2005 5.02:1
-----------------------------------------------------------------------
17.1.2 Ratio of Consolidated EBITDA of the UK Group to the
aggregate of UK Group Total Interest Payable, UK Group
Capital Expenditure and Permitted Payments
(a) The ratio of the Consolidated EBITDA of the UK Group
for each Relevant Period ended on the Quarter Dates
specified in column one below to the aggregate of
(a) UK Group Total Interest Payable for that
Relevant Period, (b) UK Group Capital Expenditure
accrued during that Relevant Period and (c)
Permitted Payments made during that Relevant Period,
shall be equal to or greater than the ratio set out
in column two below corresponding to that Quarter
Date.
--------------------------------- ----------------------------------------
Column One Column Two
Quarter Date Consolidated EBITDA of the UK Group:
the aggregate of UK Group Total
Interest Payable, UK Group Capital
Expenditure and Permitted Payments
--------------------------------- ----------------------------------------
31 March 2003 0.62:1
--------------------------------- ----------------------------------------
30 June 2003 0.65:1
--------------------------------- ----------------------------------------
30 September 2003 0.69:1
--------------------------------- ----------------------------------------
31 December 2003 0.66:1
--------------------------------- ----------------------------------------
31 March 2004 0.67:1
--------------------------------- ----------------------------------------
30 June 2004 0.69:1
--------------------------------- ----------------------------------------
30 September 2004 0.72:1
--------------------------------- ----------------------------------------
31 December 2004 0.74:1
--------------------------------- ----------------------------------------
31 March 2005 0.77:1
--------------------------------- ----------------------------------------
30 June 2005 0.81:1
--------------------------------- ----------------------------------------
30 September 2005 0.83:1
--------------------------------- ----------------------------------------
31 December 2005 0.88:1
--------------------------------- ----------------------------------------
74
(b) The ratio of Consolidated EBITDA of the UK Group for
the financial year of the Borrower ending on the
Quarter Dates specified in column one below to the
aggregate of (a) UK Group Total Interest Payable for
that financial year; (b) UK Group Capital
Expenditure accrued during that financial year; and
(c) Permitted Payments made during that financial
year, shall be equal to or greater than the ratio
set out in column two below corresponding to that
Quarter Date.
------------------------------------------------------------------------
Column One Column Two
Quarter Date Consolidated EBITDA of the UK Group:
the aggregate of UK Group Total
Interest Payable, UK Group Capital
Expenditure and Permitted Payments
------------------------------------------------------------------------
31 December 2003 0.65:1
------------------------------------------------------------------------
31 December 2004 0.71:1
------------------------------------------------------------------------
31 December 2005 0.84:1
------------------------------------------------------------------------
17.1.3 Aggregate amount of Liquidity of members of the UK Group
and members of the Parent Covenant Group
The aggregate amount of Liquidity of members of the UK
Group and of members of the Parent Covenant Group as at
each Quarter Date in column one listed below shall be
equal to or greater than the amount set out in column two
below corresponding to such Quarter Date.
--------------------------------------------------------------------------
Column One Column Two
Quarter Date Liquidity of members of the UK Group
and members of the Parent Covenant
Group ((pound))
--------------------------------------------------------------------------
31 March 2003 209,000,000
--------------------------------------------------------------------------
30 June 2003 209,000,000
--------------------------------------------------------------------------
30 September 2003 137,000,000
--------------------------------------------------------------------------
31 December 2003 156,000,000
--------------------------------------------------------------------------
31 March 2004 88,000,000
--------------------------------------------------------------------------
30 June 2004 113,000,000
--------------------------------------------------------------------------
30 September 2004 61,000,000
--------------------------------------------------------------------------
31 December 2004 100,000,000
--------------------------------------------------------------------------
31 March 2005 64,000,000
--------------------------------------------------------------------------
30 June 2005 123,000,000
--------------------------------------------------------------------------
30 September 2005 86,000,000
--------------------------------------------------------------------------
31 December 2005 144,000,000
--------------------------------------------------------------------------
75
--------------------------------------------------------------------------
31 March 2006 115,000,000
--------------------------------------------------------------------------
17.2 Group Financial Condition
New NTL shall ensure that the financial condition of the Group shall
be such that:
(a) Ratio of Group Net Consolidated Total Debt to Consolidated
Annualised EBITDA of the Group
The ratio of the Group Net Consolidated Total Debt on each
of the Quarter Dates specified in column one below to the
Consolidated Annualised EBITDA of the Group for the Relevant
Period ended on that Quarter Date shall be no greater than
the ratio set out in column two below corresponding to that
Quarter Date.
------------------------------------------------------------------------------------------
Column One Column Two
Quarter Date Group Net Consolidated Total Debt: Consolidated
Annualised EBITDA of the Group
------------------------------------------------------------------------------------------
31 March 2003 8.18:1
------------------------------------------------------------------------------------------
30 June 2003 8.16:1
------------------------------------------------------------------------------------------
30 September 2003 7.71:1
------------------------------------------------------------------------------------------
31 December 2003 7.26:1
------------------------------------------------------------------------------------------
31 March 2004 7.03:1
------------------------------------------------------------------------------------------
30 June 2004 6.91:1
------------------------------------------------------------------------------------------
30 September 2004 6.75:1
------------------------------------------------------------------------------------------
31 December 2004 6.48:1
------------------------------------------------------------------------------------------
31 March 2005 6.20:1
------------------------------------------------------------------------------------------
30 June 2005 5.91:1
------------------------------------------------------------------------------------------
30 September 2005 5.63:1
------------------------------------------------------------------------------------------
31 December 2005 5.35:1
------------------------------------------------------------------------------------------
Ratio of Group Net Consolidated Total Debt to Consolidated EBITDA of
the Group
(b) The ratio of Group Net Consolidated Total Debt on each of
the Quarter Dates specified in column one below to the
Consolidated EBITDA of the Group for the financial year of
New NTL ended on that Quarter Date shall be no greater than
the ratio set out in column two below corresponding to that
Quarter Date.
76
------------------------------------------------------------------------------------------
Column One Column Two
Quarter Date Group Net Consolidated Total Debt: Consolidated
EBITDA of the Group
------------------------------------------------------------------------------------------
31 December 2003 7.68:1
------------------------------------------------------------------------------------------
31 December 2004 6.69:1
------------------------------------------------------------------------------------------
31 December 2005 5.59:1
------------------------------------------------------------------------------------------
17.3 Financial Definitions
Capitalised terms, when used in the definitions contained in this
Clause 17.3, shall bear the same meanings as those ascribed to them
in the Senior Bank Credit Agreement.
"Allowable Exceptional Items" means any items treated as exceptional
items which the Reporting Accountants have confirmed to the Agent:
(a) may be treated as exceptional items required to be shown
after operating profit in accordance with paragraph 20 of
Financial Reporting Standard 3 (Reporting Financial
Performance) in the form issued by the Accounting Standards
Board as at the Restatement Amendment Effective Date; or
(b) are charges or credits directly attributable to business
rationalisation and which are:
(i) redundancy termination costs and other costs
directly attributable to redundancies;
(ii) property disposal and closure costs;
(iii) other costs incurred in terminating contracts as a
direct result of rationalisation; or
(iv) professional fees incurred solely in connection with
the costs referred to at paragraphs (i) to (iii)
above.
"Available Cash" means at any time, cash (in cleared balances)
denominated in sterling (or any other currency freely convertible
into sterling) and credited to an account in the name of a member of
the Covenant Group or the UK Group with an Eligible Deposit Bank and
to which such a member of the Covenant Group or, as the case may be,
the UK Group is alone beneficially entitled and for so long as such
cash is repayable on demand (including any cash held on time deposit
which is capable of being broken and the balance received on same day
notice provided that any such cash shall only be taken into account
net of any penalties or costs which would be incurred in breaking the
relevant time deposit) and repayment of such cash is not contingent
on the prior discharge of any other indebtedness of any member of the
Covenant Group or, as the case may be, the UK Group or of any other
person whatsoever or on the satisfaction of any other condition.
77
"Capital Expenditure" means expenditure on the acquisition or
improvement of an asset which would be treated as a capital asset in
accordance with generally accepted accounting principles in the
United Kingdom.
"Cash" means at any time, cash (in cleared balances) denominated in
sterling (or any other currency freely convertible into sterling) and
credited to an account in the name of a member of the Group, the
Covenant Group or (as applicable) the UK Group with an Eligible
Deposit Bank and to which such a member of the Group, the Covenant
Group or (as applicable) the UK Group is alone beneficially entitled
and for so long as:
(a) such cash is repayable on demand (including any cash held on
time deposit which is capable of being broken and the
balance received on same day notice provided that any such
cash shall only be taken into account net of any penalties
or costs which would be incurred in breaking the relevant
time deposit) and repayment of such cash is not contingent
on the prior discharge of any other indebtedness of any
member of the Group, the Covenant Group or (as applicable)
the UK Group or of any other person whatsoever or on the
satisfaction of any other condition; or
(b) such cash has been deposited with an Eligible Deposit Bank
as security for any performance bond, guarantee, standby
letter of credit or similar facility the contingent
liabilities relating to such having been included in the
calculation of UK Group Consolidated Total Debt or, as the
case may be, Group Consolidated Total Debt.
"Consolidated Annualised EBITDA" means with respect to any Quarter
Date, the consolidated EBITDA of the UK Group or, as the case may be,
the Group, for the Relevant Period ended on such Quarter Date,
multiplied by two.
"Consolidated EBITDA" means with respect to any Quarter Date, the
consolidated EBITDA of the UK Group or, as the case may be, the
Group, for the Relevant Period or, as the case may be, the financial
year of the Parent or New NTL ended on such Quarter Date.
"Current Assets" means the aggregate of inventory, trade and other
receivables of each member of the UK Group including sundry debtors
(but excluding cash at bank) maturing within twelve months from the
date of computation.
"Current Liabilities" means the aggregate of all liabilities
(including trade creditors, accruals and provisions and prepayments)
of each member of the UK Group falling due within twelve months from
the date of computation and required to be accounted for as "current
liabilities" under generally accepted accounting principles in the
United Kingdom but excluding consolidated aggregate Indebtedness for
Borrowed Money of the UK Group falling due within such period and any
interest on such Indebtedness for Borrowed Money due in such period.
"EBIT" means, in respect of any period, the consolidated net income
of the UK Group or, as the case may be, the consolidated net income
of the Group for such period adding back (only to the extent, in each
case, deducted in calculating such consolidated net income):
78
(a) any provision on account of taxation;
(b) any interest (including capitalised interest), commission,
discounts or other fees incurred or payable by any member of
the UK Group or, as the case may be, the Group in respect of
Indebtedness for Borrowed Money;
(c) in relation to the consolidated net income of the UK Group
or the Group, any net amounts paid pursuant to the interest
hedging arrangements entered into in respect of the
Revolving Facility or the Term Facility and, in relation to
the consolidated net income of the Group only, any net
amounts paid pursuant to interest hedging arrangements
entered into in respect of Permitted Covenant Group
Indebtedness;
(d) (i) in the case of the UK Group, Allowable Exceptional
Items;
(ii) in the case of the Group, any Allowable Exceptional
Items included in the calculation of EBIT of the UK
Group and any Allowable Exceptional Items in
respect of any other member of the Group
incorporated in a jurisdiction which requires its
financial statements to be governed by generally
accepted accounting principles in the United
Kingdom, Ireland or the United States of America;
and
(iii) in the case of the UK Group or the Group, any other
similar items agreed between the Parent and the
Agent (acting on the instructions of an Instructing
Group); and
(e) separation and integration costs and payments made by any
member of the UK Group under schedule 8 of the Transaction
Agreement.
"EBITDA" means, in respect of any period, EBIT of the UK Group or, as
the case may be, the Group for such period adding back (only to the
extent, in each case, deducted in calculating EBIT):
(a) any amount attributable to amortisation of intangible assets
(including goodwill);
(b) depreciation of tangible assets and capitalised costs and
expenses; and
(c) amortisation, or the writing off, of transaction expenses in
relation to the Acquisition,
and deducting any costs and expenses capitalised in accordance with
the accounting policies, practices and procedures applied in the
preparation of the relevant financial statements of the Group or, as
the case may be, the UK Group during such period (other than costs
and expenses incurred in constructing or upgrading cable networks in
the ordinary course of the UK Group's business or, as the case may
be, the Group's, business).
"Eligible Deposit Bank" means any bank or financial institution which
is a Bank and has a short term rating of at least A1 granted by
Standard & Poor's Corporation or P1 granted by Moody's Investors
Services, Inc.
79
"Financial Quarter" means the period commencing on the day after one
Quarter Date and ending on the next Quarter Date.
"Group Consolidated Total Debt" means, at any time (without double
counting), the aggregate principal, capital or nominal amounts
(including any capitalised interest) of indebtedness of any member of
the Group constituting Indebtedness for Borrowed Money together with
any other indebtedness of any member of the Group constituting
Indebtedness for Borrowed Money which is due and payable and has not
been paid at such time and in respect of which the grace period (if
any) specified in the documentation relating thereto has expired, but
excluding Indebtedness for Borrowed Money of any member of the Group
to another member of the Group to the extent permitted or not
prohibited under this Agreement.
"Group Net Consolidated Total Debt" means, at any time, the Group
Consolidated Total Debt at such time less Cash, in cleared balances
at such time, credited to an account in the name of a member of the
Group subject to a maximum aggregate Cash amount of
(pound)150,000,000 (or its equivalent in other currencies).
"Group Total Debt Service" means, in respect of any Financial
Quarter, the aggregate of:
(a) the UK Group Total Interest Payable in respect of such
Financial Quarter; and
(b) amounts (if any) accrued during such Financial Quarter in
respect of the actual cash obligations of any member of the
Covenant Group which could (assuming that the conditions for
making the relevant Permitted Payments will be satisfied at
the time such Permitted Payment falls to be made) be
serviced by Permitted Payments falling within paragraph (a)
of the definition thereof (as set out in the Senior Bank
Credit Agreement) less any amount previously taken into
account pursuant to this paragraph (b) when calculating
Group Total Debt Service where the relevant actual cash
payment obligation of the relevant member of the Covenant
Group falls due during such Financial Quarter but is not
capable of being serviced by Permitted Payments falling
within paragraph (a) of the definition thereof (as set out
in the Senior Bank Credit Agreement) due to the conditions
for such Permitted Payments to be made not being satisfied;
(c) one quarter of the maximum amount of corporate expenses
which could (assuming that the conditions for making the
relevant Permitted Payment will be satisfied at the time
such Permitted Payment falls to be made) be serviced by
Permitted Payments falling within paragraph (b) of the
definition thereof (as set out in the Senior Bank Credit
Agreement) during the financial year of the Parent in which
the relevant Financial Quarter falls less any amount
previously taken into account pursuant to this paragraph (c)
when calculating Group Total Debt Service where, during such
Financial Quarter, it becomes apparent that such amount
previously taken into account is not capable of being
serviced by Permitted Payments falling within paragraph (b)
of the definition thereof (as set out in the Senior Bank
Credit Agreement) due to the conditions for such Permitted
Payments to be made not being satisfied or it becomes
apparent that such amount previously taken into account is
not required to be funded by a Permitted Payment falling
within paragraph (b) of the definition thereof (as set out
in the Senior Bank Credit Agreement); and
80
(d) save to the extent immediately reborrowed, the aggregate of
scheduled and mandatory payments of the principal, capital
or nominal amounts of any Indebtedness for Borrowed Money of
any member of the UK Group which fell due during such
Financial Quarter.
"Liquidity" means at any time, the aggregate amount of:
(a) Available Cash;
(b) the Available Revolving Facility (if any) provided that at
the relevant time a Revolving Advance in an amount equal to
the Available Revolving Facility would be capable of being
made in accordance with Clause 3 (Utilisation of the
Revolving Facility) of the Senior Bank Credit Agreement; and
(c) any investments of an Obligor or a member of the Covenant
Group falling within paragraph (b) or paragraph (c) of the
definition of Permitted Investments and which are held with
an Eligible Deposit Bank.
"Operating Cash Flow" means, in respect of any Financial Quarter,
EBITDA of the UK Group for that Financial Quarter after:
(a) adding back:
(i) any decrease in the amount of Working Capital at
the end of such Financial Quarter compared against
the Working Capital at the start of such Financial
Quarter; and
(ii) any cash receipt in respect of any exceptional item;
and
(b) deducting:
(i) the lesser of (x) actual Capital Expenditure by
members of the UK Group during such Financial
Quarter, and (y) an amount equal to 120 per cent.
of the budgeted Capital Expenditure for such
Financial Quarter as set out in the Updated
Business Plan provided that, in respect of any
Financial Quarter which falls within the financial
year commencing 1 January 2005 or any financial
year commencing thereafter, the budgeted Capital
Expenditure for the purposes of such calculation
shall be equal to one quarter of the amount of
Capital Expenditure specified in the Budget for
such financial year delivered pursuant to Clause
20.6 (Budgets) of the Senior Bank Credit Agreement;
(ii) any increase in the amount of Working Capital at
the end of such Financial Quarter compared against
the Working Capital at the start of that Financial
Quarter;
(iii) any amount due and payable in respect of taxes on
the profits in that Financial Quarter of any member
of the UK Group; and
(iv) any cash payment in respect of any exceptional
item;
and no amount shall be included or excluded more than once.
81
"Quarter Date" means 31 March, 30 June, 30 September and 31 December
in each year.
"Relevant Period" means each period of six months ending on a Quarter
Date.
"UK Group Capital Expenditure" means the aggregate Capital
Expenditure of members of the UK Group.
"UK Group Consolidated Total Debt" means, at any time (without double
counting), the aggregate principal, capital or nominal amounts
(including any capitalised interest) of indebtedness of any member of
the UK Group constituting Indebtedness for Borrowed Money together
with any other indebtedness of any member of the UK Group
constituting Indebtedness for Borrowed Money which is due and payable
and has not been paid at such time and in respect of which the grace
period (if any) specified in the documentation relating thereto has
expired but:
(a) excluding such Indebtedness for Borrowed Money of any member
of the UK Group to another member of the UK Group to the
extent permitted under this Agreement; and
(b) excluding any Indebtedness for Borrowed Money to the extent
such is Subordinated UK Group Debt.
"UK Group Net Consolidated Total Debt" means, at any time, UK Group
Consolidated Total Debt at such time less Cash, in cleared balances
at such time, credited to an account in the name of a member of the
UK Group subject to a maximum aggregate Cash amount of
(pound)100,000,000 (or its equivalent in other currencies).
"UK Group Total Interest Payable" means, in respect of any period,
the aggregate amount of the interest (including the interest element
of leasing and hire purchase payments), commission, fees and other
periodic finance payments which have accrued on the UK Group
Consolidated Total Debt during such period:
(a) adding any commission, fees and other finance payments
accrued during such period (whether payable during such
period or later) by any member of the UK Group under any
interest rate hedging arrangement;
(b) deducting any commission, fees and other finance payments
accrued in favour of any member of the UK Group under any
interest rate hedging arrangement permitted by this
Agreement during such period; and
(c) deducting any interest accrued in favour of any member of
the UK Group on any deposit or bank account during such
period.
"Working Capital" means on any date Current Assets less Current
Liabilities.
17.4 Accounting Terms
All accounting expressions which are not otherwise defined herein
shall be construed in accordance with generally accepted accounting
principles in England.
82
18. COVENANTS
18.1 Notification of Events of Default
The Borrower shall promptly inform the Agent of the occurrence of any
Event of Default or Potential Event of Default and, upon receipt of a
written request to that effect from the Agent, confirm to the Agent
that, save as previously notified to the Agent or as notified in such
confirmation, no Event of Default or Potential Event of Default has
occurred and is continuing.
18.2 Claims Pari Passu
Each Obligor shall ensure that subject to the Reservations:
18.2.1 at all times the claims of the Finance Parties against such
Obligor under the Finance Documents (other than the Security
Documents) to which such Obligor is party rank at least pari
passu with the claims of all its other unsecured and
unsubordinated creditors; and
18.2.2 at all times the claims of the Finance Parties against such
Obligor under the Security Documents to which such Obligor
is party rank ahead of the claims of all its other creditors
(other than (if and to the extent applicable) creditors with
the benefit of Permitted Encumbrances) against the assets
the subject of the Encumbrances created by such Security
Documents.
18.3 Maintenance and Legal Validity
Each Obligor shall, and the Borrower shall procure that each member
of the UK Group which is an Obligor (as defined in the Senior Bank
Credit Agreement) shall:
18.3.1 do all such things as are necessary to maintain its
existence as a legal person (other than as part of a solvent
reorganisation on terms which have been approved in writing
by the Agent acting on the instructions of an Instructing
Group); and
18.3.2 obtain, comply with the terms of and do all that is
necessary to maintain in full force and effect all
authorisations, approvals, licences and consents required in
or by the laws and regulations of each jurisdiction in which
it owns or leases property or in which it conducts its
business to enable it lawfully to enter into and perform its
obligations under each of the Finance Documents to which it
is expressed to be a party or to ensure the legality or
validity or (subject to the Reservations) enforceability or
admissibility in evidence in each jurisdiction in which it
owns or leases property or in which it conducts its business
(to the extent applicable) of each such Finance Document.
18.4 Insurance
Each Covenant Group Obligor shall, and shall procure that each member
of the UK Group shall, effect and maintain, insurances (or, in the
case of the Captive Insurance Company, if the Captive Insurance
Company is a member of the UK Group insurances and re-insurances) on
and in relation to its business and assets against such
83
risks as is reasonable for a company carrying on a business such as
that carried on by such Covenant Group Obligor or, as the case may
be, such member of the UK Group with either (save in respect of the
Captive Insurance Company's own insurance) the Captive Insurance
Company or with a reputable underwriter or insurance company and, in
the case of the Captive Insurance Company, the Borrower shall procure
that the Captive Insurance Company shall effect and maintain
insurances with a reputable underwriter or insurance or reinsurance
company.
18.5 Environmental Compliance
Each Covenant Group Obligor shall, and shall procure that each member
of the UK Group shall, comply in all material respects with all
Environmental Law and obtain and maintain any Environmental Permits,
breach of which (or failure to obtain or maintain which) could
reasonably be expected to have a Material Adverse Effect.
18.6 Environmental Claims
Each Covenant Group Obligor shall, and shall procure that each member
of the UK Group shall, inform the Agent in writing as soon as
reasonably practicable upon becoming aware of the same if any
Environmental Claim has been commenced or (to the best of such
person's knowledge and belief) is threatened against it in any case
where such claim would be reasonably likely, if adversely determined,
to have a Material Adverse Effect, or of any facts or circumstances
which will or are reasonably likely to result in any Environmental
Claim being commenced or threatened against such Obligor or any
member of the UK Group in any case where such claim would be
reasonably likely, if determined against such person, to have a
Material Adverse Effect.
18.7 Maintenance of Licences and Other Authorisation
Each Covenant Group Obligor shall, and shall procure that each member
of the UK Group shall:
18.7.1 ensure that it has the right and is duly qualified to
conduct its business and to the extent that the loss of any
contract, authorisation, approval, licence, consent, right
or franchise could reasonably be expected to have a Material
Adverse Effect, do all things necessary to obtain, preserve,
keep valid and binding and, where relevant, renew all such
contracts, authorisations, approvals, licences, consents,
rights and franchises; and
18.7.2 ensure that each Licence (or any replacement or renewal
thereof) is held by a member of the UK Group.
18.8 Conduct Business in Accordance with Licences
Each Covenant Group Obligor shall, and shall procure that each member
of the UK Group shall, carry on its business, or cause the same to be
carried on, in accordance with the terms and conditions of the
Licences in all material respects and no Covenant Group Obligor shall
(and each Covenant Group Obligor shall procure that no member of the
UK Group shall) do, omit to do or suffer to be done, any act whereby
any person is entitled or empowered to revoke, materially and
adversely amend, suspend, withdraw or terminate any Licence if such
amendment, revocation, suspension,
84
withdrawal or termination could reasonably be expected to have a
Material Adverse Effect.
18.9 Statutory Requirements
Each Covenant Group Obligor shall, and shall procure that each member
of the UK Group shall, comply in all material respects with all
Statutory Requirements binding upon it or enforceable against it in
respect of the conduct of its business and the ownership of its
properties if and insofar as failure to do so could reasonably be
expected to have a Material Adverse Effect.
18.10 Regulatory Notices and Communications
The Borrower shall notify the Agent within fourteen days of receipt
by any Covenant Group Obligor or any member of the UK Group of any
notice or communication from any government, court or regulatory
authority or agency (including, without prejudice to the generality
of the foregoing, the Secretary of State for Trade and Industry,
Oftel or the Radiocommunications Agency) which may give rise to the
revocation, termination, material adverse amendment, suspension,
withdrawal or avoidance of any Licences or any of the terms and
conditions thereof if such revocation, termination, material adverse
amendment, suspension, withdrawal or avoidance could reasonably be
expected to have a Material Adverse Effect.
18.11 Compliance with Material Commercial Contracts
Each Covenant Group Obligor shall, and shall procure that each member
of the UK Group shall:
18.11.1 comply in all material respects with its obligations under
each Material Commercial Contract to which it is a party and
take all action necessary to ensure the continued validity
and enforceability of its rights thereunder;
18.11.2 not amend, vary, novate or supplement any such Material
Commercial Contract in any material respect;
18.11.3 not terminate any such Material Commercial Contract prior to
its contractual termination date,
if such non-compliance, failure to take action, amendment, variation,
novation or supplement or termination, as the case may be, could
reasonably be expected to have a Material Adverse Effect.
18.12 Preservation of Assets
Each Covenant Group Obligor shall and shall procure that each member
of the UK Group shall, maintain and preserve all of its assets that
are necessary and material in the conduct of its business as
conducted at the Execution Date in good working order and condition
(ordinary wear and tear excepted), repair (with reasonable
promptness) any damage to such assets and shall maintain in all
material respects all books and records which are necessary in
connection therewith or in connection with the conduct of its
business.
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18.13 Security
Each Covenant Group Obligor shall, at its own expense, take all such
action as the Agent may reasonably require for the purpose of
perfecting or protecting the Finance Parties' rights under and
preserving the security interests intended to be created or evidenced
by any of the Finance Documents to which it is a party, and following
the making of any declaration pursuant to Clause 19.16 (Acceleration
and Cancellation) or 19.17 (Advances Due on Demand) for facilitating
the realisation of any such security or any part thereof.
18.14 Access
Each Covenant Group Obligor shall ensure that any one or more
representatives, agents and advisers of the Agent and/or any of the
Banks will be allowed, whilst an Event of Default or Potential Event
of Default is continuing and with prior notice, to have access to the
assets, books, records and premises of each Covenant Group Obligor
and each member of the UK Group and be permitted to inspect the same
during normal business hours.
18.15 Subordinated Debt
The Parent shall ensure that Subordinated Debt is the only
Indebtedness for Borrowed Money owed by the Intermediate Parent or
the Borrower to any member of the Group.
18.16 Hedging
The Borrower will:
18.16.1 promptly notify the Agent upon either it or any member of
the UK Group entering into any currency swap or interest
swap, cap or collar arrangements or any other derivative
instrument or transaction; and
18.16.2 not enter into and procure that no member of the UK Group
shall enter into any currency swap or interest swap, cap or
collar arrangements or any other derivative instrument or
transaction other than in accordance with the Hedging
Strategy.
18.17 Negative Pledge
No Covenant Group Obligor shall, and each Covenant Group Obligor
shall procure that no member of the UK Group shall, create or permit
to subsist any Encumbrance over all or any of its present or future
undertaking, revenues or assets other than Permitted Encumbrances.
18.18 Loans and Guarantees
No Covenant Group Obligor shall, and each Covenant Group Obligor
shall procure that no member of the UK Group shall, (save in the
ordinary course of business) make any loans, grant any credit or give
any guarantee or indemnity to or for the benefit of any person or
voluntarily assume any liability, whether actual or contingent, in
respect of any obligation of any other person other than Permitted
Loans and Guarantees. Any inter-company balance representing any
overpayment or any underpayment
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arising as a result of the settlement arrangements referred to at
paragraph (g)(ii) of the definition of "Permitted Loans and
Guarantees" and any payment in connection with any such overpayment
or underpayment) shall not constitute a breach of any restriction
contained in the Finance Documents.
18.19 Disposals
18.19.1 No Covenant Group Obligor shall, and each Covenant Group
Obligor shall procure that no member of the UK Group shall,
sell, lease, transfer or otherwise dispose of, by one or
more transactions or series of transactions (whether related
or not), the whole or any part of its revenues or its assets
other than any Permitted Disposal.
18.19.2 Each of New NTL and the Borrower shall procure that prior to
the earliest of (a) Note Registration; (b) the disposal of
the Towers Business (as hereainafter defined); and (c) a
refinancing of the Exit Financing other than by way of
indebtedness or, if by way of indebtedness, where the
provisions of the documents relating to such indebtedness do
not limit (and cannot operate to limit) a sale of the Towers
Business, the aggregate fair market value of Asset
Dispositions (other than any asset subject to a Sale and
Leaseback Transaction permitted under the Exit Financing
Indenture) in any Fiscal year does not exceed 5% of the
Consolidated Tangible Assets at the beginning of such Fiscal
Year. New NTL shall not agree any amendment to the New NTL
Exit Facility Agreements which imposes additional
restrictions or further circumscribes (whether directly or
indirectly) the ability of any person to dispose of the
share in or the assets of, National Transcommunications
Limited or the ability of any person to dispose of all or
any part of the group's United Kingdom broadcast business
and undertaking (the "Towers Business").
18.19.3 For the purposes of sub-clause 18.19.2, "Asset
Dispositions", "Consolidated Tangible Assets", "Fiscal
Year", "Note Registration" and "Sale and Leaseback
Transaction" shall each bear the meaning given to such term
in the Exit Financing Indenture as set out in Appendix A
(Change of Control and Asset Disposition provisions of the
Exit Financing Indenture) or as such definitions in the Exit
Financing Indenture may be amended from time to time
provided that no amendment to any such definition shall be
taken into account for the purposes of this sub-clause
18.9.3 until such time as the Agent shall have received a
copy of the amended definitions and such other information
in relation thereto as the Agent may reasonably request.
18.20 Financial Indebtedness
18.20.1 No Covenant Group Obligor shall, and each Covenant Group
Obligor shall procure that no member of the UK Group shall,
incur or allow to subsist, any Financial Indebtedness or
enter into any agreement or arrangement whereby it is
entitled to incur, create or allow to subsist any Financial
Indebtedness other than Permitted Indebtedness.
18.20.2 The Parent shall procure that the Intermediate Parent and
the Intermediate Parent shall procure that the Borrower
shall not incur, or allow to subsist, any Financial
Indebtedness between it and any other members of the Group
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or enter into any agreement or arrangement whereby it is
entitled to incur, create or allow to subsist any such
Financial Indebtedness other than Financial Indebtedness
owed (a) in the case of the Intermediate Parent, by it to
the Parent and (b) in the case of the Borrower, by it to the
Intermediate Parent.
18.20.3 The Parent and Intermediate Parent shall procure that the
only Financial Indebtedness outstanding between the Parent
and the Intermediate Parent is Subordinated Debt and/or
Assigned Debt and/or Excluded Debt.
18.20.4 The Intermediate Parent and the Borrower shall procure that
the only Financial Indebtedness outstanding between the
Intermediate Parent and the Borrower is Subordinated Debt
and (to the extent that the Intermediate Parent
Inter-Company Loan Assignment has been assigned to the
Security Trustee pursuant to Clause 11 (Assignment of NTL UK
Inter-Company Loan Assignment) of the Intercreditor
Agreement at the relevant time) Assigned Debt.
18.21 Restricted Payments
No Covenant Group Obligor shall and each Covenant Group Obligor shall
procure that no member of the UK Group shall make any Restricted
Payment other than Permitted Payments.
18.22 Acquisitions and Investments
No Covenant Group Obligor shall, and each Covenant Group Obligor
shall procure that no member of the UK Group shall, (a) purchase,
subscribe for or otherwise acquire any shares (or other securities or
any interest therein) in, or incorporate, any other company or agree
to do any of the foregoing, or (b) purchase or otherwise acquire
(other than in the ordinary course of business) any assets or
revenues or any business or interest therein or agree to do so, save
for (and for agreements relating to):
18.22.1 any investment or acquisition of assets contemplated in the
Updated Business Plan provided that the aggregate value of
all such acquisitions and investments shall not exceed
(pound)25,000,000 (or its equivalent in other currencies);
18.22.2 Permitted Investments; and
18.22.3 Permitted Acquisitions.
18.23 Mergers
No Covenant Group Obligor shall, and each Covenant Group Obligor
shall procure that no member of the UK Group shall, enter into any
merger or consolidation with any other person save for, respectively,
another member of the UK Group (in the case of a member of the UK
Group). The Parent shall not enter into any merger or consolidation
with any other person if the validity, perfection or priority of the
Security would be adversely impaired as a result thereof.
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18.24 Change of Business
Save as contemplated in the Updated Business Plan (and provided that
nothing in this Clause 18.24 shall prevent a member of the Covenant
Group from making any investment or disposal which is otherwise
permitted under this Agreement) no Covenant Group Obligor shall, and
each Covenant Group Obligor shall procure that no member of the UK
Group shall, enter into any type of business sector which would
result in a change in the business focus of the Covenant Group taken
as a whole from its business focus as at the Execution Date.
18.25 Shares
No Covenant Group Obligor shall, and each Covenant Group Obligor
shall procure that no member of the UK Group shall, without the prior
written consent of an Instructing Group, alter any rights attaching
to its issued shares if those shares are subject to the Security and
such an alteration would be reasonably likely to prejudice to value
of, or the ability of the Security Trustee to realise the security
over those shares.
18.26 Transactions with Affiliates
18.26.1 No Covenant Group Obligor shall, and each Covenant Group
Obligor shall procure that no member of the UK Group shall,
enter into any transaction with an affiliate of such
Covenant Group Obligor or, as the case may be, member of the
UK Group other than:
(a) transactions disclosed in writing to, and approved
by, the Agent prior to the Restatement Amendment
Effective Time;
(b) transactions in respect of either Subordinated
Funding or Parent Funding;
(c) transactions:
(i) between members of the Group incorporated
in the United Kingdom (other than
transactions which are otherwise prohibited
by this Agreement or the Senior Bank Credit
Agreement);
(ii) between members of the Group incorporated
in the United States of America (other than
transactions which are otherwise prohibited
by this Agreement or by the Senior Bank
Credit Agreement);
(iii) not falling within sub-paragraphs (i) or
(ii) of this Clause 18.26.1(c), between
members of the Group where such are
otherwise permitted by this Agreement or by
the Senior Bank Credit Agreement;
(d) transactions in the ordinary course of business and
either on no worse than arms' length terms or, where
there is no available market by which to assess
whether such a transaction is on no worse than arms'
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length terms, on terms such that the transaction is
financially fair to the relevant Covenant Group
Obligor or, as the case may be, member of the UK
Group;
(e) transactions to effect either an Asset Passthrough
or a Funding Passthrough;
(f) insurance arrangements entered into in the ordinary
course of business with the Captive Insurance
Company;
(g) tax sharing arrangements and agreements to surrender
tax losses provided that any such new arrangement or
agreement entered into after the Restatement
Amendment Effective Time is disclosed to the Agent
on or prior to being entered into;
(h) transactions relating to the provision of
Intra-Group Services;
(i) transactions with Cable & Wireless and its
subsidiaries in relation to the Transaction
Agreement;
(j) transactions relating to Excess Capacity Network
Services provided that the price payable by any
affiliates in relation to such Excess Capacity
Network Services is no less than the cost incurred
by the relevant Covenant Group Obligor or as the
case may be, member of the UK Group in providing
such Excess Capacity Network Services;
(k) transactions constituted by loans or investments in
any UK Group Excluded Subsidiary where such are
otherwise permitted under this Agreement and by the
Senior Bank Credit Agreement;
(l) transactions either on terms and conditions
(including, without limitation, as to any fees
payable in connection with such transactions) not
substantially less favourable to the relevant
Covenant Group Obligor or, as the case may be,
member of the UK Group than would be obtainable at
such time in comparable arm's length transactions
with an entity which is not an affiliate or, where
there is no comparable arm's length transaction by
which to assess whether such a transaction is on
terms and conditions not substantially less
favourable to the relevant Covenant Group Obligor
or, as the case may be, member of the UK Group, on
such terms and conditions (including, without
limitation, as to any fees payable in connection
with such transaction) such that the transaction is
financially fair to the relevant Covenant Group
Obligor or, as the case may be, member of the UK
Group; and
(m) any transaction relating to or in connection with
the purchase or refinancing of the (pound)90 million
note currently constituting the NTL Delaware
Subordinated Debt provided that any refinancing
thereof from time to time shall not exceed (pound)90
million together with accrued interest (or its
equivalent in other currencies).
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18.26.2 The Borrower shall ensure that each Compliance Certificate
delivered pursuant to Clause 16.5 (Compliance Certificates)
has attached thereto:
(a) a schedule in the form, or substantially in the
form, agreed between the Borrower and the Reporting
Accountants prior to the Restatement Amendment
Effective Time setting out: -
(i) details of the outstanding debit and credit
balances (as at the last day of the
Financial Quarter to which such Compliance
Certificate relates) in respect of each
Affiliate for which an Affiliate
Transaction has been notified to the Agent
as a condition precedent to the Restatement
Amendment Effective Time or which has been
notified to the Agent in the attachment to
any Compliance Certificate previously
delivered to the Agent (other than
transactions between the Intermediate
Parent and/or any Obligors (as defined in
the Senior Bank Credit Agreement) and
transactions under the agency arrangements
which have been notified to the Agent as a
condition precedent to the Restatement
Amendment Effective Time or from time to
time thereafter in accordance with
paragraph (b) of this sub-clause 18.26.2);
and
(ii) details of the monthly movements of
material debits and credits for each
Affiliate Transaction in respect of each
Affiliate referred to at paragraph (i)
above during such Financial Quarter,
provided that in respect of NTL (South
Hertfordshire) Limited, this requirement will be
satisfied by the delivery of the relevant 10-Q or
10-K for South Hertfordshire United Kingdom Fund,
Ltd as soon as reasonably practicable after the same
(and not with delivery of the relevant Compliance
Certificate) is available;
(b) a schedule (prepared on a best efforts basis)
listing all Affiliate Transactions with a monetary
value equal to or greater than(pound)1,000,000 per
annum (other than transactions between the
Intermediate Parent and/or any Obligors (as defined
in the Senior Bank Credit Agreement) and
transactions under the agency arrangements which
have been notified to the Agent as a condition
precedent to the Restatement Amendment Effective
Time or from time to time thereafter in accordance
with this paragraph (b)) and details of the
accession of any new principal (other than an
Obligor (as defined in the Senior Bank Credit
Agreement)) to the agency agreements which were
notified to the Agent as a condition precedent to
the Restatement Amendment Effective Time, in each
case, which have not previously been notified to the
Agent; and
(c) a list (prepared on a best efforts basis) of all
affiliates which had no trading activity or
financing arrangements with any member of the UK
Group over the relevant Financial Quarter or written
confirmation that there has been no change from the
list previously delivered to the Agent under this
paragraph (c).
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18.27 Change in Financial Year
No Covenant Group Obligor shall, and each Covenant Group Obligor
shall procure that no member of the UK Group shall, change the end of
its financial year, other than as agreed by an Instructing Group,
acting reasonably or so as to ensure that the financial year of each
member of the UK Group ends on the same date as the financial year of
the Borrower.
18.28 Revised Group Structure
If the Borrower becomes aware of any material inaccuracy in the
corporate structure as set out in either the Group Structure Chart
delivered to the Agent under the Restatement Amendment Agreement as a
condition precedent to the Restatement Amendment Effective Time or
any Group Structure Chart delivered to the Agent pursuant to this
Clause 18.28, it will deliver to the Agent as soon as reasonably
practicable thereafter a revised group structure chart insofar as it
relates to the position within the Group of New NTL, the Parent and
the corporate structure of the Covenant Group which is true, complete
and accurate.
18.29 Issuance of Capital Stock
The Parent shall procure that no capital stock of the Borrower or any
Guarantor (other than New NTL or the Parent) is held by any person
which is not a wholly-owned subsidiary of New NTL or a Guarantor
which is either party to this Agreement at the Restatement Amendment
Effective Time or has become a Guarantor pursuant to Clause 37
(Accession of Guarantors) and all the requirements set forth on
Schedule 8 (Additional Conditions Precedent) with respect thereto
have been satisfied.
18.30 Restrictions on Payments
No Covenant Group Obligor shall, and each Covenant Group Obligor
shall procure that no member of the UK Group shall, enter into any
restrictions on the ability of any member of the UK Group to pay
dividends, to make loans to, repay or prepay loans made by, or
transfer assets to, the Borrower or any other member of the UK Group,
except for: -
18.30.1 the restrictions set forth in the Senior Bank Credit
Agreement as in effect at the Restatement Amendment
Effective Time or in the intra-group loan assignments
entered into by the Borrower pursuant to the Senior Bank
Credit Agreement;
18.30.2 the restrictions set forth in the New NTL Exit Facility
Agreements as in effect on the Plan Effective Date or
equivalent or less onerous provisions contained in any
agreement relating to the Permitted Refinancing of the New
NTL Exit Facility;
18.30.3 restrictions entered into in connection with the incurrence
of Financial Indebtedness incurred pursuant to clause (e) of
the definition of Permitted Indebtedness provided that such
restrictions are no more restrictive than those set forth in
the Senior Bank Credit Agreement as in effect at the
Restatement Amendment Effective Time;
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18.30.4 restrictions imposed by applicable law;
18.30.5 restrictions set forth in any agreement constituting or
regulating any Permitted Encumbrance with respect to the
transfer of any asset which is the subject of such Permitted
Encumbrance;
18.30.6 customary non assignment provisions in leases entered into
in the ordinary course of business and consistent with past
practice; and
18.30.7 customary non-assignment provisions contained in documents
with respect to the rights conferred by those documents to
the extent that any such non-assignment provision does not
constitute a restriction on the ability of any member of the
UK Group to pay dividends, make loans or repay or prepay
loans made by the Borrower or any member of the UK Group.
18.31 Investments in the UK Group
The Borrower shall procure that notwithstanding anything to the
contrary set forth in this Agreement all investments by the Borrower
in the UK Group will be in the form of loans (except that to the
extent that the Borrower determines in good faith that it is tax
efficient to make such investments in the form of equity or capital
contribution, and the outstanding principal amount of inter-company
loans made by the Borrower is at no time less than
(pound)1,300,000,000 (or, if less, the outstanding principal amount
of the Loan) such investments may be in the form of equity or capital
contributions).
18.32 Maintenance of Corporate Separateness
The Parent (x) will, and will procure that each other Guarantor and
the Borrower satisfies customary corporate formalities, including the
holding of regular board of directors' and shareholders' meetings or
action by directors or shareholders without a meeting and the
maintenance of corporate offices and records; and (y) will not take
any action, or conduct its affairs in a manner, which could result in
the corporate existence of any such person being ignored, or in the
assets and liabilities of any such person being substantively
consolidated with those of any other such person in a bankruptcy,
reorganization or other insolvency proceeding.
18.33 Cancellation of Subordinated Debt
The Parent shall not cancel, write-off or otherwise forgive all or
any part of any loans made to the Intermediate Parent (being
Subordinated Debt), without the prior written consent of the Agent,
if such cancellation, write-off or other forgiveness might reasonably
be expected to give rise to material tax liabilities for the UK Group
taken as a whole, which cannot be sheltered by the net operating
losses of the Group available at the time of such cancellation, write
off or forgiveness.
18.34 Post Plan Effective Date Investigations and Reports
18.34.1. The Borrower undertakes to instruct Sullivan & Cromwell LLC
("S&C") and Deloitte & Touche LLC ("D&T") to investigate as
soon as reasonably practicable after the Plan Effective Date
a sample of the UK Group's internal controls including,
without limitation, the internal controls relating to the
procuring and monitoring of outsourcing arrangements
(including in
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relation to the Profectus Contracts (as defined in S&C's
written report dated 18 December 2002 which has been
delivered to the Agent) and the Group's information
technology services contracts with IBM) and to prepare a
written report within 3 months of the execution of the
engagement letters with S&C and D&T (or such longer period
as may reasonably required in order to complete the relevant
investigation). The division of the work between S&C and D&T
will reflect their respective expertise. S&C and D&T shall
be instructed to detail in the written report the results of
such investigation and to recommend any steps to be taken to
remedy any material deficiencies in internal controls
identified. S&C and D&T shall be instructed by the Borrower
to include the Banks as addressees of the written report but
only on the basis that neither S&C nor D&T shall have any
liability to any of the Banks. The Borrower shall pay all
reasonable fees and expenses incurred by S&C and D&T in
making such investigation and preparing such written report.
The Borrower shall provide S&C and D&T with such access to
the books and records and personnel of the Group as may
reasonably be required for the purposes of such
investigation and written report. S&C and D&T shall be
entitled to instruct such third party experts as they may
reasonably require to assist them in the investigation and
preparation of the written report.
18.34.2. If the written report referred to at sub-clause 18.34.1 of
this Clause 18.34 recommends any proposals to be taken by
the UK Group to remedy any material deficiencies in internal
controls relating to outsourcing arrangements, the Borrower
agrees, after consultation with the Agent, S&C and D&T, to
adopt such proposals as are considered reasonably
commercially practicable as soon as reasonably practicable
after the conclusion of such consultation provided that the
adoption of such proposals are subject to final approval by
the board of directors of New NTL acting reasonably in its
exercise of its fiduciary duties.
18.34.3. If the written report referred to at sub-clause 18.34.1 of
this Clause 18.34 recommends any proposals to be taken by
the UK Group to remedy any material deficiencies in internal
controls relating to non-outsourcing arrangements, the
Borrower agrees to consider such proposals as soon as
reasonably practicable after publication of the report,
subject to approval of such proposals by the board of
directors of New NTL.
19. EVENTS OF DEFAULT
Each of Clause 19.1 (Failure to Pay) to Clause 19.15 (Material
Adverse Change) describes circumstances which constitute an Event of
Default for the purposes of this Agreement. Clause 19.16
(Acceleration and Cancellation) and Clause 19.17 (Advances Due on
Demand) deal with the rights of the Agent and the Banks after the
occurrence of an Event of Default.
19.1 Failure to Pay
Any of the Obligors fails to pay any sum due from it under any of the
Finance Documents to which it is a party at the time, in the currency
and in the manner specified therein unless:
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19.1.1 the sum is of a principal amount which was not paid as a
result of a technical error or failure in the transmission
of funds and that payment is then received by the Agent
within one Business Day of the due date;
19.1.2 the sum is of an amount of interest and that payment is then
received by the Agent within three Business Days of the due
date; or
19.1.3 the sum is of an amount other than principal or interest and
that payment is then received by the Agent within five
Business Days of the due date.
19.2 Misrepresentation
Any representation or statement made or repeated at any time
whatsoever by any Obligor in any of the Finance Documents or in any
notice or other document or certificate delivered by it pursuant
thereto or in connection therewith is or proves to have been
incorrect or misleading in any material respect when made or deemed
to be made and the circumstances giving rise to such inaccuracy, if
capable of remedy or change, are not remedied or do not change, such
that the relevant representation or statement would be correct and
not misleading if repeated five Business Days after the earlier of
(a) it being notified by the Agent to New NTL and the Borrower in all
other cases, as having been made inaccurately and (b) the relevant
Obligor becoming aware of such inaccuracy.
19.3 Specific Covenants
Any of the Obligors fails to comply with any of its obligations under
Clause 16 (Financial Information) or Clause 18 (Covenants). No Event
of Default under this Clause 19.3 shall occur in relation to:
19.3.1 Clause 16.1 (Annual Statements) to Clause 16.10 (Other
Financial Information), Clause 16.12 (General Information)
or Clause 16.13 (Litigation and Government or Regulatory
Enquiry), if the failure to comply with such is remedied
within five Business Days of the Agent giving notice thereof
to the Borrower; and
19.3.2 Clause 18 (Covenants), if the failure to comply with such is
capable of remedy and is remedied within five Business Days
of the date on which an Obligor became aware of such failure
to comply provided that a breach of any of the obligations
under Clause 18.2 (Claims Pari Passu), Clause 18.3
(Maintenance and Legal Validity), Clause 18.8 (Conduct
Business in Accordance with Licences), Clause 18.17
(Negative Pledge), Clause 18.18 (Loans and Guarantees),
Clause 18.19 (Disposals), Clause 18.21 (Restricted
Payments), Clause 18.22 (Acquisitions and Investments),
Clause 18.23 (Mergers), Clause 18.26 (Transactions with
Affiliates) and Clause 18.33 (Cancellation of Subordinated
Debt) shall immediately give rise to an Event of Default.
19.4 Other Obligations
Any of the Obligors fails duly to perform or comply with any other
obligation expressed to be assumed by it in any of the Finance
Documents and such failure is not remedied within thirty days after
the Agent has given notice thereof to the Borrower.
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19.5 Financial Condition
At any time any of the requirements of Clause 17.1 (UK Group
Financial Condition) or Clause 17.2 (Group Financial Condition) is
not satisfied.
19.6 Cross Default
Any:
19.6.1 Financial Indebtedness of any member of the Covenant Group
is not paid when due and payable (after taking account of
any applicable grace period) or, if payable on demand (after
taking account of any applicable grace period), is not paid
on demand;
19.6.2 Financial Indebtedness of any member of the Covenant Group
is declared to be or otherwise becomes due and payable prior
to its specified maturity by reason of a default by the
relevant member of the Covenant Group (after taking account
of any applicable grace period);
19.6.3 commitment for any Financial Indebtedness of any member of
the Covenant Group is cancelled or suspended by reason of a
default by the relevant member of the Covenant Group; or
19.6.4 holder or holders, creditor or creditors of any member of
the Parent Covenant Group becomes entitled to declare any
Specified Financial Indebtedness of such member of the
Parent Covenant Group due and payable prior to its specified
maturity by reason of default by the relevant member of the
Parent Covenant Group after taking account of any applicable
grace period,
save that (x) this Clause 19.6 shall not apply to any Financial
Indebtedness of any Obligor or of any other member of the Covenant
Group or the Parent Covenant Group (as the case may be) where such
Financial Indebtedness or demand in relation thereto (a) is cash
collateralised and such cash is available for application in
satisfaction of such Financial Indebtedness, (b) is being contested
in good faith by appropriate action or (c) when aggregated with all
such Financial Indebtedness of the Covenant Group or the Parent
Covenant Group (as the case may be) does not exceed an aggregate of
(pound)20,000,000 (or its equivalent in other currencies) and (y) for
the avoidance of doubt, an Event of Default shall not occur under
sub-clause 19.6.4 of this Clause 19.6 by reason of the occurrence of
an event described therein in respect of the Financial Indebtedness
of a member of the UK Group (including, without limitation, Financial
Indebtedness under the Senior Bank Credit Agreement).
19.7 Insolvency and Rescheduling
Any Obligor or any member of the UK Group which is an Obligor (as
defined in the Senior Bank Credit Agreement):
19.7.1 is unable to pay its debts as they fall due;
19.7.2 commences negotiations with any one or more of its creditors
with a view to the general readjustment or rescheduling of
its indebtedness (other than as
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part of a solvent reorganisation of an Obligor or a member
of the UK Group which is an Obligor (as defined in the
Senior Bank Credit Agreement) on terms which have been
approved in writing by the Agent, acting on the instructions
of an Instructing Group);
19.7.3 makes a general assignment for the benefit of or a
composition with its creditors; or
19.7.4 has a moratorium declared in respect of any of its
indebtedness.
19.8 Winding-up
Any Obligor or any member of the UK Group which is an Obligor (as
defined in the Senior Bank Credit Agreement) takes any corporate
action or other steps are taken or legal proceedings are started and
served for its winding-up, dissolution, administration or
re-organisation whether by way of voluntary arrangement, scheme of
arrangement or otherwise or for the appointment of a liquidator,
receiver, administrator, administrative receiver, conservator,
custodian, trustee or similar officer of it or of its revenues and
assets provided that it shall not constitute an Event of Default if:
19.8.1 such action, steps or proceedings relate to a liquidation or
re-organisation of a member of the UK Group which is an
Obligor (as defined in the Senior Bank Credit Agreement)
(other than the Borrower) on terms which have been approved
in writing by the Agent, acting on the instructions of an
Instructing Group; or
19.8.2 such action, steps or proceedings (a) are frivolous or
vexatious, (b) do not relate to the appointment of an
administrator (or its equivalent in any other jurisdiction)
and (c) are contested in good faith by appropriate legal
action and are stayed or discharged within thirty days of
their commencement.
19.9 Execution or Distress
Any execution or distress is levied against, or an encumbrancer takes
possession of, the whole or any part of, the property, undertaking or
assets of any Obligor or any member of the UK Group which is an
Obligor (as defined in the Senior Bank Credit Agreement), where:
19.9.1 the aggregate value of such assets exceeds(pound)250,000 (or
its equivalent in other currencies); and
19.9.2 such execution, distress or possession is not discharged
within thirty days.
19.10 Analogous Events
Any event occurs which under the laws of any jurisdiction has a
similar or analogous effect to any of those events mentioned in
Clause 19.7 (Insolvency and Rescheduling), Clause 19.8 (Winding-up)
or Clause 19.9 (Execution or Distress).
19.11 Governmental Intervention
By or under the authority of any government, (a) the management of
any Covenant Group Obligor or any member of the UK Group which is an
Obligor (as defined in the
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Senior Bank Credit Agreement) is wholly or partially displaced or the
authority of any Covenant Group Obligor or any member of the UK Group
which is an Obligor (as defined in the Senior Bank Credit Agreement)
in the conduct of a material part of its business is wholly or
partially curtailed or (b) all or a majority of the issued shares of
any Covenant Group Obligor or any member of the UK Group which is an
Obligor (as defined in the Senior Bank Credit Agreement) or the whole
or any substantial part of its revenues or assets is seized,
nationalised, expropriated or compulsorily acquired, in each case
where such is not remedied to the satisfaction of the Agent within
thirty days of the relevant event occurring.
19.12 Repudiation
19.12.1 Any Obligor repudiates any of the Finance Documents; or
19.12.2 the security intended to be created by, or the subordination
effected under, the Finance Documents is not or ceases to be
legal and valid and (except as contemplated by the
Reservations or, if capable of remedy, such as is remedied
within five Business Days of the earlier of (a) notice of
the relevant event by the Agent to New NTL and the Borrower
and (b) the date on which the relevant Obligor becomes aware
of such event) binding and enforceable.
19.13 Illegality
At any time it is or becomes unlawful for any of the Obligors to
perform or comply with any or all of its obligations under any of the
Finance Documents to which it is a party or any of the obligations of
any of the Obligors thereunder are not or cease to be legal, valid
and (except as contemplated by the Reservations or, if capable of
remedy, such as is remedied within five Business Days of the earlier
of (a) notice of the relevant event by the Agent to New NTL and the
Borrower and (b) the date on which the relevant Obligor becomes aware
of such event) binding and enforceable.
19.14 Asset Adjustment Payments and Transfers of Assets
If:
19.14.1 following a member of the UK Group having made an Asset
Adjustment Payment within paragraph (a) of the definition
thereof, an amount equal to such Asset Adjustment Payment
(including for the avoidance of doubt, any amount in respect
of VAT) is not (in accordance with the other terms of this
Agreement) reimbursed to that member of the UK Group by
Cable & Wireless on or before the date which is thirty
Business Days after the date on which such Asset Adjustment
Payment was made; or
19.14.2 following a member of the UK Group having made an Asset
Adjustment Payment within paragraph (c) of the definition
thereof:
(a) the relevant member of the UK Group has not made a
claim for credit or repayment from HM Customs &
Excise in an amount equal to such Asset Adjustment
Payment on or before the date which is thirty-one
days after the last day of the Prescribed Accounting
Period during which the supply to which such Asset
Adjustment Payment
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relates is treated as taking place for the purposes
of Section 6 of the VAT Act; or
(b) the relevant member of the UK Group has not received
a credit or repayment from HM Customs & Excise in an
amount equal to, and in respect of, such Asset
Adjustment Payment on or before the date which is
thirty Business Days after the date on which the
relevant member of the UK Group made a claim for
credit or repayment from HM Customs & Excise in
respect of such Asset Adjustment Payment in
accordance with paragraph (a) of this sub-clause
19.14.2. For the purposes of this sub-clause 19.14.2
of this Clause 19.14, references to the relevant
member of the UK Group shall, unless the context
requires otherwise, be deemed at any time when such
relevant member is a member of a group for the
purposes of Sections 43 and 43C of the VAT Act, to
include a reference to the representative member of
such group. For the purposes of this paragraph (b),
the relevant member of the UK Group shall be deemed
to have received a credit or repayment from HM
Customs & Excise in respect of a claim (y) where the
claim is satisfied by way of credit only, on the
date on which the relevant member of the UK Group
submits a VAT return to HM Customs & Excise claiming
the relevant credit and (z) where the claim is
satisfied by way of repayment only or by way of both
credit and repayment, on the date on which the
relevant member of the UK Group receives the
relevant repayment from HM Customs & Excise; or
19.14.3 following a transfer of assets from a member of the UK Group
to a company carrying on the CWC DataCo Business referred to
in paragraph (d) of the definition of Asset Adjustment
Payments, New NTL has not, on or before the date which is
thirty Business Days after the date on which the transfer of
assets referred to at paragraph (d) of the definition of
Asset Adjustment Payments was made, paid to the member of
the UK Group an amount equal to the full market value
(exclusive of any amount in respect of VAT) of the asset
transferred; or
19.14.4 following a transfer of assets from a member of the UK Group
to a company carrying on the CWC DataCo Business where no
consideration is paid by the company carrying on the CWC
DataCo Business to the member of the UK Group in connection
with the transfer of such assets in accordance with the
Transaction Agreement, New NTL has not in accordance with
the description of the relevant reimbursement payment set
out in the Asset Adjustment Payments Memorandum, on or
before the date which is thirty Business Days after the date
on which the transfer of assets was made, paid to the member
of the UK Group an amount equal to the full market value (if
any) (including any amount in respect of VAT) of the assets
transferred;
provided that, the aggregate amount of Asset Adjustment Payments
referred to at paragraphs (a) and (b) of sub-clause 19.14.2 of this
Clause 19.14 and amounts referred to at sub-clauses 19.14.1, 19.14.3
and 19.14.4 of this Clause 19.14 exceeds (pound)10,000,000 in
aggregate (or its equivalent in other currencies).
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19.15 Material Adverse Change
Any event or circumstance which would have a Material Adverse Effect
occurs.
19.16 Acceleration and Cancellation
Upon the occurrence of an Event of Default at any time thereafter
whilst such event is continuing, the Agent may (and, if so instructed
by an Instructing Group, shall) by written notice to the Borrower:
19.16.1 declare the Advances to be immediately due and payable
(whereupon the same shall become so payable together with
accrued interest thereon and any other sums then owed by the
Borrower hereunder) or declare the Advances to be due and
payable on demand of the Agent; and/or
19.16.2 exercise or direct the Security Trustee to exercise (on its
own behalf and on behalf of the Banks) all rights and
remedies of a mortgagee or a secured party at such time and
(without limitation), subject to the Security Documents and
to the extent permitted by applicable law, (a) foreclose on
any or all of the assets subject to the Security by any
available judicial procedure, (b) take possession of any or
all of the assets subject to the Security and the books and
records relating thereto, with or without judicial process
and/or (c) enter any premises where any assets subject to
the Security, or any books and records relating thereto, are
located and take possession of and remove the same
therefrom.
19.17 Advances Due on Demand
If, pursuant to Clause 19.16 (Acceleration and Cancellation), the
Agent declares the Advances to be due and payable on demand of the
Agent, then, and at any time thereafter, the Agent may (and, if so
instructed by an Instructing Group, shall) by written notice to the
Borrower:
19.17.1 require repayment of the Advances on such date as it may
specify in such notice (whereupon the same shall become due
and payable on such date together with accrued interest
thereon and any other sums then owed by the Borrower
hereunder) or withdraw its declaration with effect from such
date as it may specify in such notice;
19.17.2 select as the duration of any Interest Period which begins
whilst such declaration remains in effect a period of six
months or less; and/or.
19.17.3 exercise or direct the Security Trustee to exercise (on its
own behalf and on behalf of the Banks) all rights and
remedies of a secured party in accordance with sub-clause
19.16.3 of Clause 19.16 (Acceleration and Cancellation).
20. GUARANTEE AND INDEMNITY
20.1 Guarantee and Indemnity
Each of the Guarantors irrevocably and unconditionally jointly and
severally:
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20.1.1 guarantees to each Finance Party the due and punctual
observance and performance of all the terms, conditions and
covenants on the part of the Borrower contained in the
Finance Documents and agrees to pay from time to time on
demand any and every sum or sums of money which the Borrower
is at any time liable to pay to any Finance Party under or
pursuant to the Finance Documents and which has become due
and payable but has not been paid at the time such demand is
made; and
20.1.2 agrees as a primary obligation to indemnify each Finance
Party from time to time on demand from and against any loss
incurred by any Finance Party as a result of any of the
obligations of the Borrower under or pursuant to the Finance
Documents being or becoming void, voidable, unenforceable or
ineffective as against the Borrower for any reason
whatsoever, whether or not known to any Finance Party or any
other person, the amount of such loss being the amount which
the person or persons suffering it would otherwise have been
entitled to recover from the Borrower.
20.2 Additional Security
The obligations of each Guarantor herein contained shall be in
addition to and independent of every other security which any Finance
Party may at any time hold in respect of any of any Obligor's
obligations under the Finance Documents.
20.3 Continuing Obligations
The obligations of each Guarantor herein contained shall constitute
and be continuing obligations notwithstanding any settlement of
account or other matter or thing whatsoever and shall not be
considered satisfied by any intermediate payment or satisfaction of
all or any of the obligations of the Borrower under the Finance
Documents and shall continue in full force and effect until final
payment in full of all amounts owing by the Borrower under the
Finance Documents and total satisfaction of all the Borrower's actual
and contingent obligations under the Finance Documents.
20.4 Obligations not Discharged
Neither the obligations of each Guarantor herein contained nor the
rights, powers and remedies conferred in respect of each Guarantor
upon any Finance Party by the Finance Documents or by law shall be
discharged, impaired or otherwise affected by:
20.4.1 the winding-up, dissolution, administration or
re-organisation of any Obligor or any other person or any
change in its status, function, control or ownership;
20.4.2 any of the obligations of any Obligor or any other person
under the Finance Documents or under any other security
taken in respect of any of its obligations under the Finance
Documents being or becoming illegal, invalid, unenforceable
or ineffective in any respect;
20.4.3 time or other indulgence being granted or agreed to be
granted to any Obligor or any other person in respect of its
obligations under the Finance Documents or under any such
other security;
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20.4.4 any amendment to, or any variation, waiver or release of,
any obligation of any Obligor or any other person under the
Finance Documents or under any such other security;
20.4.5 any failure to take, or fully to take, any security
contemplated hereby or otherwise agreed to be taken in
respect of any Obligor's obligations under the Finance
Documents;
20.4.6 any failure to realise or fully to realise the value of, or
any release, discharge, exchange or substitution of, any
security taken in respect of any Obligor's obligations under
the Finance Documents; or
20.4.7 any other act, event or omission which, but for this Clause
20.4, might operate to discharge, impair or otherwise affect
any of the obligations of each Guarantor herein contained or
any of the rights, powers or remedies conferred upon any of
the Finance Parties by the Finance Documents or by law.
20.5 Settlement Conditional
Any settlement or discharge between a Guarantor and any of the
Finance Parties shall be conditional upon no security or payment to
any Finance Party by an Obligor or any other person on behalf of an
Obligor being avoided or reduced by virtue of any laws relating to
bankruptcy, insolvency, liquidation or similar laws of general
application and, if any such security or payment is so avoided or
reduced, each Finance Party shall be entitled to recover the value or
amount of such security or payment from such Guarantor subsequently
as if such settlement or discharge had not occurred.
20.6 Exercise of Rights
No Finance Party shall be obliged before exercising any of the
rights, powers or remedies conferred upon them in respect of any
Guarantor by the Finance Documents or by law:
20.6.1 to make any demand of any Obligor (save where such demand is
expressly required by the terms of the Finance Documents);
20.6.2 to take any action or obtain judgment in any court against
any Obligor;
20.6.3 to make or file any claim or proof in a winding-up or
dissolution of any Obligor; or
20.6.4 to enforce or seek to enforce any other security taken in
respect of any of the obligations of any Obligor under the
Finance Documents.
20.7 Deferral of Guarantors' Rights
Until all amounts which may be or become payable by the Borrower
under or in connection with the Finance Documents have been
irrevocably paid in full and unless the Agent otherwise directs, no
Guarantor will exercise any rights which it may have by reason of
performance by it of its obligations under the Finance Documents:
20.7.1 to be indemnified by an Obligor; and/or
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20.7.2 to claim any contribution from any other guarantor of any
obligations of the Borrower under the Finance Documents;
and/or
20.7.3 to take the benefit (in whole or in part and whether by way
of subrogation or otherwise) of any rights of the Finance
Parties under the Finance Documents or of any other
guarantee or security taken pursuant to, or in connection
with, the Finance Documents by any Finance Party,
provided that, notwithstanding the foregoing provisions of this
Clause 20.7, no Guarantor may exercise any rights as aforesaid if any
Security over the shares in any Guarantor has been enforced.
20.8 Appropriations
Until all amounts which may be or become payable by the Borrower
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:
20.8.1 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 no Guarantor shall be entitled to the benefit
of the same; and
20.8.2 hold in an interest-bearing suspense account any moneys
received from any Guarantor or on account of any Guarantor's
liability under this Clause 20 (Guarantee and Indemnity).
21. AGENCY FEES
21.1 Agency Fees
The Borrower shall pay to the Agent for its own account the agency
fees specified in the letter dated [o] December 2002 from the Agent
to the Borrower at the times and in the amounts specified in such
letter.
22. COSTS AND EXPENSES
22.1 Transaction Expenses
The Borrower shall, from time to time on demand of the Agent,
reimburse each of the Agent and the Arrangers for all reasonable
costs and expenses (including legal fees) together with any VAT
thereon incurred by it in connection with the negotiation,
preparation and execution of the Finance Documents, any other
document referred to in the Finance Documents and the completion of
the transactions therein contemplated.
22.2 Preservation and Enforcement of Rights
The Borrower shall, from time to time on demand of the Agent,
reimburse the Finance Parties for all costs and expenses (including
legal fees) on a full indemnity basis together with any VAT thereon
incurred in or in connection with the preservation and/or enforcement
of any of the rights of the Finance Parties under the Finance
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Documents and any document referred to in the Finance Documents
(including, without limitation, any costs and expenses reasonably
incurred in relation to any investigation as to whether or not an
Event of Default might have occurred or is likely to occur or any
steps necessary or desirable in connection with any proposal for
remedying or otherwise resolving an Event of Default or Potential
Event of Default).
22.3 Stamp Taxes
The Borrower shall pay all stamp, registration and other taxes to
which the Finance Documents or any judgment given in connection
therewith is or at any time may be subject and shall, from time to
time on demand of the Agent, indemnify the Finance Parties against
any liabilities, costs, claims and expenses resulting from any
failure to pay or any delay in paying any such tax.
22.4 Amendment Costs
If an Obligor requests any amendment, waiver or consent then the
Borrower shall, within five Business Days of demand by the Agent,
reimburse the Finance Parties for all costs and expenses (including
legal fees) together with any VAT thereon reasonably incurred by such
person in responding to or complying with such request.
22.5 Banks' Liabilities for Costs
If the Borrower fails to perform any of its obligations under this
Clause 22 (Costs and Expenses), each Bank shall, in its Proportion,
indemnify each of the Agent and the Arrangers against any loss
incurred by any of them as a result of such failure.
23. DEFAULT INTEREST AND BREAK COSTS
23.1 Default Interest Periods
If any sum due and payable by an Obligor hereunder is not paid on the
due date therefor in accordance with Clause 26 (Payments) or if any
sum due and payable by an Obligor under any judgment of any court in
connection herewith is not paid on the date of such judgment, the
period beginning on such due date or, as the case may be, the date of
such judgment and ending on the date upon which the obligation of
such Obligor to pay such sum is discharged shall be divided into
successive periods, each of which (other than the first) shall start
on the last day of the preceding such period and the duration of each
of which shall (except as otherwise provided in this Clause 23
(Default Interest and Break Costs)) be selected by the Agent.
23.2 Default Interest
An Unpaid Sum shall bear interest during each Interest Period in
respect thereof at the rate per annum which is one per cent. per
annum above the percentage rate which would apply if such Unpaid Sum
had been an Advance in the amount and currency of such Unpaid Sum and
for the same Interest Period, provided that if such Unpaid Sum
relates to an Advance which became due and payable on a day other
than the last day of an Interest Period relating thereto:
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23.2.1 the first Interest Period applicable to such Unpaid Sum
shall be of a duration equal to the unexpired portion of the
current Interest Period relating to that Advance; and
23.2.2 the percentage rate of interest applicable thereto from time
to time during such period shall be that which exceeds by
one per cent. the rate which would have been applicable to
it had it not so fallen due.
23.3 Payment of Default Interest
Any interest which shall have accrued under Clause 23.2 (Default
Interest) in respect of an Unpaid Sum shall be due and payable and
shall be paid by the Obligor owing such Unpaid Sum on the last day of
its Interest Period in respect thereof or on such other dates as the
Agent may specify by notice to such Obligor.
23.4 Break Costs
If any Bank or the Agent on its behalf receives or recovers all or
any part of such Bank's share of an Advance or Unpaid Sum otherwise
than on the last day of the Interest Period relating thereto, the
Borrower shall pay to the Agent on demand for account of such Bank an
amount equal to the amount (if any) by which (a) the additional
interest which would have been payable on the amount so received or
recovered had it been received or recovered on the last day of that
Interest Period exceeds (b) the amount of interest which in the
opinion of the Agent would have been payable to the Agent on the last
day of that Interest Period in respect of a deposit in the currency
of the amount so received or recovered equal to the amount so
received or recovered placed by it with a prime bank in London for a
period starting on the Business Day following the date of such
receipt or recovery and ending on the last day of that Interest
Period.
24. BORROWER'S INDEMNITIES
24.1 Borrower's Indemnity
The Borrower undertakes to indemnify:
24.1.1 each Finance Party against any cost, claim, loss, expense
(including legal fees) or liability together with any VAT
thereon, which it may sustain or incur as a consequence of
the occurrence of any Event of Default or any default by any
Obligor in the performance of any of the obligations
expressed to be assumed by it in the Finance Documents;
24.1.2 each Bank against any cost or loss it may suffer under
Clause 22.5 (Banks' Liabilities for Costs) or Clause 29.6
(Indemnification); and
24.1.3 each Bank against any cost or loss it may suffer or incur as
a result of its funding or making arrangements to fund its
portion of an Advance requested by the Borrower but not made
by reason of the operation of any one or more of the
provisions hereof.
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24.2 Currency Indemnity
If any sum (a "Sum") due from an Obligor under the Finance Documents
or any order or judgment given or made in relation thereto has to be
converted from the currency (the "First Currency") in which such Sum
is payable into another currency (the "Second Currency") for the
purpose of:
24.2.1 making or filing a claim or proof against such Obligor;
24.2.2 obtaining or enforcing an order or judgment in any court or
other tribunal,
the Borrower shall indemnify each person to whom such Sum is due from
and against any loss suffered or incurred as a result of any
discrepancy between (a) the rate of exchange used for such purpose to
convert such Sum from the First Currency into the Second Currency and
(b) the rate or rates of exchange available to such person at the
time of receipt of such Sum.
25. CURRENCY OF ACCOUNT AND PAYMENT
Sterling is the currency of account and payment for each and every
sum at any time due from an Obligor hereunder, provided that:
25.1.1 each payment in respect of costs and expenses shall be made
in the currency in which the same were incurred; and
25.1.2 each payment pursuant to Clause 10.2 (Tax Indemnity), Clause
12.1 (Increased Costs) or Clause 24 (Borrowers Indemnities)
shall be made in the currency specified by the party
claiming thereunder.
26. PAYMENTS
26.1 Notification of Payments
Without prejudice to the liability of each party hereto promptly to
pay each amount owing by it hereunder on the due date therefor,
whenever a payment is expected to be made by any of the parties
hereto, the Agent shall, at least two Business Days prior to the
expected date for such payment, notify all the parties hereto of the
amount, currency and timing of such payment and the identity of the
party liable to make such payment.
26.2 Payments to the Agent
On each date on which this Agreement requires an amount to be paid by
an Obligor or a Bank, such Obligor or, as the case may be, such Bank
shall make the same available to the Agent for value on the due date
at such time and in such funds and to such account with such bank as
the Agent shall (acting reasonably) specify from time to time.
26.3 Payments by the Agent
26.3.1 Save as otherwise provided herein, each payment received by
the Agent pursuant to Clause 26.2 (Payments to the Agent)
shall:
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(a) in the case of a payment received for the account of
the Borrower, be made available by the Agent to the
Borrower by application:
(i) first, in or towards payment on the same
day of any amount then due from the
Borrower hereunder to the person from whom
the amount was so received; and
(ii) secondly, in or towards payment on the same
day to the account of the Borrower with
such bank in London as the Borrower shall
have previously notified to the Agent for
this purpose; and
(b) in the case of any other payment, be made available
by the Agent to the person entitled to receive such
payment in accordance with this Agreement (in the
case of a Bank, for the account of its Facility
Office) for value the same day by transfer to such
account of such person with such bank in London as
such person shall have previously notified to the
Agent.
26.3.2 A payment will be deemed to have been made by the Agent on
the date on which it is required to be made under this
Agreement if the Agent has, on or before that date, taken
steps to make that payment in accordance with the
regulations or operating procedures of the clearing or
settlement system used by the Agent in order to make the
payment.
26.4 No Set-off
All payments required to be made by an Obligor hereunder shall be
calculated without reference to any set-off or counterclaim and shall
be made free and clear of and without any deduction for or on account
of any set-off or counterclaim.
26.5 Clawback
Where a sum is to be paid hereunder to the Agent for account of
another person, the Agent shall not be obliged to make the same
available to that other person until it has been able to establish to
its satisfaction that it has actually received such sum, but if it
does so and it proves to be the case that it had not actually
received such sum, then the person to whom such sum was so made
available shall on request refund the same to the Agent together with
an amount sufficient to indemnify the Agent against any cost or loss
it may have suffered or incurred by reason of its having paid out
such sum prior to its having received such sum.
26.6 Partial Payments
If and whenever a payment is made by an Obligor hereunder and the
Agent receives an amount less than the due amount of such payment the
Agent may apply the amount received towards the obligations of the
Obligors under this Agreement in the following order:
26.6.1 first, in or towards payment of any unpaid costs and
expenses of the Agent;
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26.6.2 secondly, in or towards payment pro rata of any accrued
interest or commitment commission due but unpaid;
26.6.3 thirdly, in or towards payment pro rata of any principal due
but unpaid; and
26.6.4 fourthly, in or towards payment pro rata of any other sum
due but unpaid.
26.7 Variation of Partial Payments
The order of partial payments set out in Clause 26.6 (Partial
Payments) shall override any appropriation made by the Obligor to
which the partial payment relates but the order set out in
sub-clauses 26.6.2, 26.6.3 and 26.6.4 of Clause 26.6 (Partial
Payments) may be varied if agreed by all the Banks.
26.8 Business Days
26.8.1 Any payment which is due to be made on a day that is not a
Business Day shall be made on the next Business Day in the
same calendar month (if there is one) or the preceding
Business Day (if there is not).
26.8.2 During any extension of the due date for payment of any
principal or an Unpaid Sum under this Agreement interest
is payable on the principal at the rate payable on the
original due date.
27. SET-OFF
27.1 Contractual Set-off
Each Obligor authorises each Bank, at any time any sum is due and
payable hereunder and remains unpaid, to apply any credit balance to
which such Obligor is entitled on any account of such Obligor with
such Bank in satisfaction of any sum due and payable from such
Obligor to such Bank under the Finance Documents but unpaid. For this
purpose, each Bank is authorised to purchase with the moneys standing
to the credit of any such account such other currencies as may be
necessary to effect such application.
27.2 Set-off not Mandatory
No Bank shall be obliged to exercise any right given to it by Clause
27.1 (Contractual Set-off).
28. SHARING
28.1 Payments to Banks
If a Bank (a "Recovering Bank") applies any receipt or recovery from
an Obligor to a payment due under this Agreement and such amount is
received or recovered other than in accordance with Clause 26
(Payments), then such Recovering Bank shall:
28.1.1 notify the Agent of such receipt or recovery; and
28.1.2 at the request of the Agent, promptly pay to the Agent an
amount (the "Sharing Payment") equal to such receipt or
recovery less any amount
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which the Agent determines may be retained by such
Recovering Bank as its share of any payment to be made in
accordance with Clause 26.6 (Partial Payments).
28.2 Redistribution of Payments
The Agent shall treat the Sharing Payment as if it had been paid by
the relevant Obligor and distribute it between the Finance Parties
(other than the Recovering Bank) in accordance with Clause 26.6
(Partial Payments).
28.3 Recovering Bank's Rights
The Recovering Bank will be subrogated into the rights of the parties
which have shared in a redistribution pursuant to Clause 28.2
(Redistribution of Payments) in respect of the Sharing Payment (and
the relevant Obligor shall be liable to the Recovering Bank in an
amount equal to the Sharing Payment).
28.4 Repayable Recoveries
If any part of the Sharing Payment received or recovered by a
Recovering Bank becomes repayable and is repaid by such Recovering
Bank, then:
28.4.1 each party which has received a share of such Sharing
Payment pursuant to Clause 28.2 (Redistribution of Payments)
shall, upon request of the Agent, pay to the Agent for
account of such Recovering Bank an amount equal to its share
of such Sharing Payment; and
28.4.2 such Recovering Bank's rights of subrogation in respect of
any reimbursement shall be cancelled and the relevant
Obligor will be liable to the reimbursing party for the
amount so reimbursed.
28.5 Exception
This Clause 28 (Sharing) shall not apply if the Recovering Bank would
not, after making any payment pursuant hereto, have a valid and
enforceable claim against the relevant Obligor.
28.6 Recoveries Through Legal Proceedings
If any Bank intends to commence any action in any court it shall give
prior notice to the Agent and the other Banks. If any Bank shall
commence any action in any court to enforce its rights hereunder and,
as a result thereof or in connection therewith, receives any amount,
then such Bank shall not be required to share any portion of such
amount with any Bank which has the legal right to, but does not, join
in such action or commence and diligently prosecute a separate action
to enforce its rights in another court.
29. THE AGENT, THE ARRANGERS AND THE BANKS
29.1 Appointment of the Agent
Each of the Arrangers and the Banks hereby appoints the Agent to act
as its agent in connection herewith and authorises the Agent to
exercise such rights, powers,
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authorities and discretions as are specifically delegated to the
Agent by the terms hereof together with all such rights, powers,
authorities and discretions as are reasonably incidental thereto.
29.2 Agent's Discretions
The Agent may:
29.2.1 assume, unless it has, in its capacity as agent for the
Banks, received notice to the contrary from any other party
hereto, that (a) any representation made or deemed to be
made by an Obligor in connection with the Finance Documents
is true, (b) no Event of Default or Potential Event of
Default has occurred, (c) any Obligor is in breach of or
default under its obligations under the Finance Documents
and (d) any right, power, authority or discretion vested
herein upon an Instructing Group, the Banks or any other
person or group of persons has not been exercised;
29.2.2 assume that (a) the Facility Office of each Bank is that
notified to it by such Bank in writing and (b) the
information provided by each Bank pursuant to Clause 29.15
(Banks' Mandatory Cost Details), Clause 34 (Notices) and
Schedule 7 (Mandatory Costs) is true and correct in all
respect until it has received from such Bank notice of a
change to the Facility Office or any such information and
act upon any such notice until the same is superseded by a
further notice;
29.2.3 engage and pay for the advice or services of any lawyers,
accountants, surveyors or other experts whose advice or
services may to it seem necessary, expedient or desirable
and rely upon any advice so obtained;
29.2.4 rely as to any matters of fact which might reasonably be
expected to be within the knowledge of an Obligor upon a
certificate signed by or on behalf of such Obligor;
29.2.5 rely upon any communication or document believed by it to be
genuine;
29.2.6 refrain from exercising any right, power or discretion
vested in it as agent hereunder unless and until instructed
by an Instructing Group as to whether or not such right,
power or discretion is to be exercised and, if it is to be
exercised, as to the manner in which it should be exercised;
29.2.7 refrain from acting in accordance with any instructions of
an Instructing Group to begin any legal action or proceeding
arising out of or in connection with the Finance Documents
until it shall have received such security as it may require
(whether by way of payment in advance or otherwise) for all
costs, claims, losses, expenses (including legal fees) and
liabilities together with any VAT thereon which it will or
may expend or incur in complying with such instructions.
29.2.8 assume (unless it has specific notice to the contrary) that
any notice or request made by the Borrower is made on behalf
of all the Obligors.
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29.3 Agent's Obligations
The Agent shall:
29.3.1 promptly inform each Bank of the contents of any written
notice or document received by it in its capacity as Agent
from an Obligor under the Finance Documents;
29.3.2 promptly notify each Bank of the occurrence of any Event of
Default or any default by an Obligor in the due performance
of or compliance with its obligations under the Finance
Documents of which the Agent has notice from any other party
hereto;
29.3.3 promptly notify each Bank of the occurrence of an Event of
Default under Clause 19.1 (Failure to Pay);
29.3.4 promptly notify each Bank of all or any part of the Advances
being declared to be immediately due and payable in
accordance with either Clause 19.16 (Acceleration and
Cancellation) or Clause 19.17 (Advances Due on Demand);
29.3.5 save as otherwise provided herein, act as agent hereunder in
accordance with any instructions given to it by an
Instructing Group, which instructions shall be binding on
the Arrangers and the Banks;
29.3.6 if so instructed by an Instructing Group, refrain from
exercising any right, power or discretion vested in it as
agent hereunder; and
29.3.7 unless it has a Bank's consent, refrain from acting on
behalf of that Bank in any legal or arbitration proceedings
relating to any Finance Document.
The Agent's duties under the Finance Documents are solely mechanical
and administrative in nature.
29.4 Excluded Obligations
Notwithstanding anything to the contrary expressed or implied herein,
neither the Agent nor an Arranger shall:
29.4.1 be bound to enquire as to (a) whether or not any
representation made or deemed to be made by an Obligor in
connection with the Finance Documents is true, (b) the
occurrence or otherwise of any Event of Default or Potential
Event of Default, (c) the performance by an Obligor of its
obligations under the Finance Documents or (d) any breach of
or default by an Obligor of or under its obligations under
the Finance Documents;
29.4.2 be bound to account to any Bank for any sum or the profit
element of any sum received by it for its own account;
29.4.3 be bound to disclose to any other person any information
relating to any member of the Group if (a) such information
is confidential or (b) such disclosure would or might in its
reasonable opinion constitute a breach of any law or a
breach of fiduciary duty;
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29.4.4 be under any obligations other than those for which express
provision is made herein; or
29.4.5 be or be deemed to be a fiduciary for any other party
hereto.
29.5 Delegation
The Agent may delegate, transfer or assign to any of its holding
companies, subsidiaries or subsidiaries of any of its holding
companies all or any of the rights, powers, authorities and
discretions vested in it under the Finance Documents and the
performance of its duties in accordance therewith, and such
delegation, transfer or assignment may be made upon such terms and
subject to such conditions (including the power to sub-delegate) and
subject to such regulations as the Agent may think fit (and the term
"Agent" as used in this Agreement shall include any such delegate).
29.6 Indemnification
Each Bank shall, in its Proportion, from time to time on demand by
the Agent, indemnify the Agent against any and all costs, claims,
losses, expenses (including legal fees) and liabilities together with
any VAT thereon which the Agent may incur, otherwise than by reason
of its own gross negligence or wilful misconduct, in acting in its
capacity as agent under the Finance Documents (other than any which
have been reimbursed by the Borrower pursuant to Clause 24.1
(Borrowers' Indemnity)).
29.7 Exclusion of Liabilities
Each Bank confirms that it has read the Notice to Recipients in the
Information Memorandum, that it has complied with the Recipients'
Obligations (as set out in the Notice to Recipients) and,
accordingly, that it enters into this Agreement on the basis of the
Notice to Recipients. In particular, each of the Banks accepts that
it is entering into this Agreement in reliance only on the
representations of the Obligors in this Agreement and on its own
investigations, that it has not relied on the Arrangers and that,
except as set out below, it neither has nor will have any claims
against the Arrangers arising from or in connection with this
Agreement. Similarly, each of the Banks accepts that the Notice to
Recipients in the Information Memorandum is applicable also to the
Agent as if the Agent had been named in addition to the Arrangers in
the Important Notice.
Except in the case of gross negligence or wilful default, neither the
Agent nor any Arranger accepts any responsibility to any of the
Banks:
29.7.1 for the adequacy, accuracy and/or completeness of the
Information Memorandum or any other information supplied by
the Agent or the Arrangers, by an Obligor or by any other
person in connection with the Finance Documents or any other
agreement, arrangement or document entered into, made or
executed in anticipation of, pursuant to or in connection
with the Finance Documents;
29.7.2 for the legality, validity, effectiveness, adequacy or
enforceability of the Finance Documents or any other
agreement, arrangement or document entered into, made or
executed in anticipation of, pursuant to or in connection
with the Finance Documents; or
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29.7.3 for the exercise of, or the failure to exercise, any
judgement, discretion or power given to any of them by or in
connection with the Finance Documents or any other
agreement, arrangement or document entered into, made or
executed in anticipation of, pursuant to or in connection
with the Finance Documents.
Accordingly, neither the Agent nor an Arranger shall be under any
liability (whether in negligence or otherwise) in respect of such
matters, save in the case of gross negligence or wilful misconduct.
29.8 No Actions
Each of the Banks agrees that it will not assert or seek to assert
against any director, officer or employee of the Agent or the
Arrangers any claim it might have against any of them in respect of
the matters referred to in Clause 29.7 (Exclusion of Liabilities).
29.9 Business with the Group
The Agent and the Arrangers may accept deposits from, lend money to
and generally engage in any kind of banking or other business with
any member of the Group whether or not it may or does lead to a
conflict with the interests of any of the Banks. Similarly, the Agent
or the Arrangers may undertake business with or for others even
though it may lead to a conflict with the interests of any of the
Banks.
29.10 Resignation
The Agent may resign its appointment hereunder at any time without
assigning any reason therefor by giving not less than thirty days'
prior notice to that effect to each of the other parties hereto,
provided that no such resignation shall be effective until a
successor for the Agent is appointed in accordance with the
succeeding provisions of this Clause 29 (The Agent, the Arrangers and
the Banks).
29.11 Removal of Agent
An Instructing Group may, after consultation with the Borrower,
remove the Agent from its role as agent under the Finance Documents
by giving notice to that effect to each of the other parties hereto.
Such removal shall take effect only when a successor to the Agent is
appointed in accordance with the terms of the Finance Documents.
29.12 Successor Agent
If the Agent gives notice of its resignation pursuant to Clause 29.10
(Resignation) or it is removed pursuant to Clause 29.11 (Removal of
Agent), then any reputable and experienced bank or other financial
institution may, with the prior consent of the Borrower be appointed
as a successor to the Agent by an Instructing Group during the period
of such notice but, if no such successor is so appointed, the Agent
may appoint such a successor itself.
29.13 Rights and Obligations
If a successor to the Agent is appointed under the provisions of
Clause 29.12 (Successor Agent), then (a) the retiring or departing
Agent shall be discharged from
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any further obligation under the Finance Documents but shall remain
entitled to the benefit of the provisions of this Clause 29 (The
Agent, the Arrangers and the Banks) and (b) its successor and each of
the other parties hereto shall have the same rights and obligations
amongst themselves as they would have had if such successor had been
a party hereto.
29.14 Own Responsibility
It is understood and agreed by each Bank that at all times it has
itself been, and will continue to be, solely responsible for making
its own independent appraisal of and investigation into all risks
arising under or in connection with the Finance Documents including,
but not limited to:
29.14.1 the financial condition, creditworthiness, condition,
affairs, status and nature of each member of the Group;
29.14.2 the legality, validity, effectiveness, adequacy and
enforceability of the Finance Documents and any other
agreement, arrangement or document entered into, made or
executed in anticipation of, pursuant to or in connection
with the Finance Documents;
29.14.3 whether such Bank has recourse, and the nature and extent of
that recourse, against an Obligor or any other person or any
of their respective assets under or in connection with the
Finance Documents, the transactions therein contemplated or
any other agreement, arrangement or document entered into,
made or executed in anticipation of, pursuant to or in
connection with the Finance Documents; and
29.14.4 the adequacy, accuracy and/or completeness of the
Information Memorandum and any other information provided by
the Agent or the Arrangers or an Obligor or by any other
person in connection with the Finance Documents, the
transactions contemplated therein or any other agreement,
arrangement or document entered into, made or executed in
anticipation of, pursuant to or in connection with the
Finance Documents.
Accordingly, each Bank acknowledges to the Agent and the Arrangers
that it has not relied on and will not hereafter rely on the Agent
and the Arrangers or any of them in respect of any of these matters.
29.15 Banks' Mandatory Cost Details
Each Bank will supply the Agent with such information and in such
detail as the Agent may require in order to calculate the Mandatory
Cost Rate in accordance with Schedule 7 (Mandatory Costs).
29.16 Receipt of Information by the Agent
Any information or document received by the Agent shall only be
treated as having been received by the Agent if the same has been
delivered to the Agent's agency department in accordance with Clause
34 (Notices). Accordingly, any information or documents received by
the Agent other than by its agency department in accordance with
Clause 34 (Notices) is not by reason of that receipt to be treated as
having been
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received by the Agent unless and until the Agent's agency
department has received actual notice of the same in accordance with
such Clause. Save as expressly set out in this Agreement and, unless
the Agent's agency department shall have received information or
documents in accordance with Clause 34 (Notices) the Agent shall have
no duty to disclose, and shall not be liable for the failure to
disclose, any information or documents, that are communicated to or
obtained by the Agent.
30. ASSIGNMENTS AND TRANSFERS
30.1 Binding Agreement
The Finance Documents shall be binding upon and enure to the benefit
of each party hereto and its or any subsequent successors and
Transferees.
30.2 No Assignments and Transfers by Obligors
No Obligor shall be entitled to assign or transfer all or any of its
rights, benefits and obligations under the Finance Documents, other
than as permitted pursuant to the terms of this Agreement.
30.3 Assignment and Transfers by Banks
30.3.1 Any Bank may, at any time, assign all or any of its rights
and benefits hereunder or transfer in accordance with Clause
30.5 (Transfers by Banks) all or any of its rights, benefits
and obligations hereunder to, or enter into any form of
sub-participation agreement with, a bank or financial
institution, provided that such Bank procures that the
assignee or Transferee executes and delivers to the Agent an
Intercreditor Accession Deed in the form attached to the
Intercreditor Agreement.
30.3.2 The prior written consent of the Borrower (which shall be
deemed to be given on its own behalf and on behalf of the
other Obligors) is required for an assignment or transfer by
a Bank unless the assignment or transfer is to:
(a) another Bank; or
(b) any subsidiary or holding company (or to any
subsidiary of any holding company) of the
transferring Bank.
30.3.3 The Borrower's consent must not be (a) unreasonably delayed
or withheld or (b) withheld solely because the assignment or
transfer may result in an increase to the Mandatory Cost
Rate.
30.4 Assignments by Banks
If any Bank assigns all or any of its rights and benefits under the
Finance Documents in accordance with Clause 30.3 (Assignments and
Transfers by Banks), then, unless and until the assignee has
delivered a notice to the Agent confirming in favour of the Agent,
the Arrangers and the other Banks that it shall be under the same
obligations towards each of them as it would have been under if it
had been an original party hereto as a Bank (whereupon such assignee
shall become a party hereto as a "Bank"), the Agent, the Arrangers
and the other Banks shall not be obliged to recognise such
115
assignee as having the rights against each of them which it would have
had if it had been such a party hereto.
30.5 Transfers by Banks
If any Bank wishes to transfer all or any of its rights, benefits
and/or obligations under the Finance Documents as contemplated in
Clause 30.3 (Assignments and Transfers by Banks), then such transfer
may be effected by the delivery to the Agent of a duly completed
Transfer Certificate executed by such Bank and the relevant
Transferee in which event, on the later of the Transfer Date
specified in such Transfer Certificate and the fifth Business Day
after (or such earlier Business Day endorsed by the Agent on such
Transfer Certificate falling on or after) the date of delivery of
such Transfer Certificate to the Agent:
30.5.1 to the extent that in such Transfer Certificate the Bank
party thereto seeks to transfer by novation its rights,
benefits and obligations under the Finance Documents, each
of the Obligors and such Bank shall be released from further
obligations towards one another under the Finance Documents
and their respective rights against one another shall be
cancelled (such rights and obligations being referred to in
this Clause 30.5 (Transfer by Banks) as "discharged rights
and obligations");
30.5.2 each of the Obligors and the Transferee party thereto shall
assume obligations towards one another and/or acquire rights
against one another which differ from such discharged rights
and obligations only insofar as the Obligors and such
Transferee have assumed and/or acquired the same in place of
the Obligors and such Bank;
30.5.3 the Agent, the Arrangers, such Transferee and the other
Banks shall acquire the same rights and benefits and assume
the same obligations between themselves as they would have
acquired and assumed had such Transferee been an original
party hereto as a Bank with the rights, benefits and/or
obligations acquired or assumed by it as a result of such
transfer and to that extent the Agent, the Arrangers and the
relevant Bank shall each be released from further
obligations to each other under the Finance Documents; and
30.5.4 such Transferee shall become a party hereto as a "Bank".
30.6 U.S. Tax Forms
At the time of a Transfer or Assignment pursuant to Clause 30.3
(Assignment and Transfers by Banks) to a person which is not already
a Bank hereunder and which is not a United States person (as such
term is defined in Section 7701(a)(30) of the Internal Revenue Code)
for U.S. federal income tax purposes, the Transferee or assignee Bank
must provide the appropriate Internal Revenue Service Forms (and, if
applicable, a Non-Bank Certificate) described in Clause 10.4 (U.S.
Tax Forms).
30.7 No Increased Obligations
If:
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30.7.1 a Bank assigns or transfers any of its rights or obligations
under the Finance Documents or changes its Facility Office;
and
30.7.2 as a result of circumstances existing at the date of the
assignment, transfer or change of Facility Office, an
Obligor would be obliged to make a payment to the assignee,
Transferee or the Bank acting through its new Facility
Office under Clause 10.1 (Tax Gross-up), Clause 10.2 (Tax
Indemnity) or Clause 12 (Increased Costs),
then the assignee, Transferee or the Bank acting through its new
Facility Office shall only be entitled to receive payment under those
Clauses to the same extent as the assignor, transferor or the Bank
acting through its previous Facility Office would have been if the
assignment, transfer or change had not occurred.
30.8 Assignment and Transfer Fees
On the date upon which an assignment takes effect pursuant to Clause
30.4 (Assignments by Banks) or a transfer takes effect pursuant to
Clause 30.5 (Transfers by Banks), the relevant assignee or Transferee
shall pay to the Agent for its own account a fee of (pound)1,000.
30.9 Disclosure of Information
Any Bank may disclose to any person:
30.9.1 to (or through) whom such Bank assigns or transfers (or may
potentially assign or transfer) all or any of its rights,
benefits and obligations under the Finance Documents;
30.9.2 with (or through) whom such Bank enters into (or may
potentially enter into) any sub-participation in relation
to, or any other transaction under which payments are to be
made by reference to, the Finance Documents or any Obligor;
30.9.3 to whom information may be required to be disclosed by any
applicable law; or
30.9.4 any of its subsidiaries or any holding company (or any
subsidiary of a holding company),
such information about any Obligor or the Group and the Finance
Documents as such Bank shall consider appropriate provided that, in
relation to sub-clauses 30.9.1 and 30.9.2, the person to whom such
information is to be given has entered into a Confidentiality
Undertaking. Any Bank which discloses any such information to any of
the persons referred to in sub-clause 30.9 shall procure that those
persons keep the information they receive confidential (save for
disclosures they are required to make by any applicable law).
30.10 Notification
The Agent shall within fourteen days of receiving a Transfer
Certificate or a notice relating to an assignment pursuant to Clause
30.4 (Assignment by Banks) notify the
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Borrower (on its own behalf and on behalf of the other Obligors) of
any assignment or transfer completed pursuant to this Clause 30
(Assignments and Transfers).
30.11 Morgan Stanley Commitment
References to the Commitment of Morgan Stanley Dean Witter Bank
Limited in relation to the Facility shall be construed as references
to the aggregate Commitment in relation to the Facility of Morgan
Stanley Dean Witter Bank Limited and Morgan Stanley Senior Funding,
Inc., in such proportions as Morgan Stanley Dean Witter Bank Limited
notifies to the Agent from time to time and Morgan Stanley Senior
Funding, Inc. is a party to this Agreement to give effect to such
Commitment (as so notified).
31. CHANGE OF CURRENCY
31.1 Change of Currency
Unless otherwise prohibited by law, if more than one currency or
currency unit are at the same time recognised by the Bank of England
as the lawful currency of the United Kingdom then:
31.1.1 any reference in the Finance Documents to, and any
obligations arising under the Finance Documents in, sterling
shall be translated into, or paid in the currency or
currency unit of the United Kingdom designated by the Agent
(after consultation with the Borrower);
31.1.2 any translation from one currency or currency unit to
another shall be at the official rate of exchange recognised
by the Bank of England for the conversion of that currency
or currency unit into the other, rounded up or down by the
Agent (acting reasonably); and
31.1.3 if a change in the currency of the United Kingdom occurs,
this Agreement will, to the extent the Agent (acting
reasonably and after consultation with the Borrower)
specifies to be necessary, be amended to comply with any
generally accepted conventions and market practice in the
London interbank market and otherwise to reflect the change
in currency.
31.2 Increased Costs
The Borrower shall, from time to time on demand of the Agent, pay to
the Agent for the account of such Bank the amount of any cost or
increased cost incurred by, or of any reduction in any amount payable
to or in the effective return on its capital to, or of interest or
other return foregone by, a Bank or any holding company of such Bank
as a result of the introduction of, changeover to or operation of the
euro in the United Kingdom, other than any such cost or reduction or
amount foregone reflected in the Mandatory Cost Rate.
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32. CALCULATIONS AND EVIDENCE OF DEBT
32.1 Basis of Accrual
Interest and commitment commission shall accrue from day to day and
shall be calculated on the basis of a year of 365 days (or, in any
case where market practice differs, in accordance with market
practice) and the actual number of days elapsed.
32.2 Quotations
If on any occasion a Reference Bank or Bank fails to supply the Agent
with a quotation required of it under the foregoing provisions of
this Agreement, the rate for which such quotation was required shall
be determined from those quotations which are supplied to the Agent,
provided that, in relation to determining LIBOR, this Clause 32.2
shall not apply if only one Reference Bank supplies a quotation.
32.3 Evidence of Debt
Each Bank shall maintain in accordance with its usual practice
accounts evidencing the amounts from time to time lent by and owing
to it hereunder.
32.4 Control Accounts
The Agent shall maintain on its books a control account or accounts
in which shall be recorded (a) the amount of any Advance or any
Unpaid Sum and each Bank's share therein, (b) the amount of all
principal, interest and other sums due or to become due from an
Obligor and each Bank's share therein and (c) the amount of any sum
received or recovered by the Agent hereunder and each Bank's share
therein.
32.5 Prima Facie Evidence
In any legal action or proceeding arising out of or in connection
with this Agreement, the entries made in the accounts maintained
pursuant to Clause 32.3 (Evidence of Debt) and Clause 32.4 (Control
Accounts) shall be prima facie evidence of the existence and amounts
of the specified obligations of the Obligors.
32.6 Certificates of Banks
A certificate of a Bank as to (a) the amount by which a sum payable
to it hereunder is to be increased under Clause 10.1 (Tax Gross-up),
(b) the amount for the time being required to indemnify it against
any such cost, payment or liability as is mentioned in Clause 10.2
(Tax Indemnity), Clause 12.1 (Increased Costs) or Clause 24.1
(Borrower's Indemnity) or (c) the amount of any credit, relief,
remission or repayment as is mentioned in Clause 11.3 (Tax Credit
Payment) or Clause 11.4 (Tax Credit Clawback) shall, in the absence
of manifest error, be prima facie evidence of the existence and
amounts of the specified obligations of the Obligors.
32.7 Agent's Certificates
A certificate of the Agent as to the amount at any time due from a
Borrower hereunder or the amount which, but for any of the
obligations of such Borrower hereunder being or becoming void,
voidable, unenforceable or ineffective, at any time
119
would have been due from such Borrower hereunder shall, in the
absence of manifest error, be conclusive for the purposes of Clause
20 (Guarantee and Indemnity).
33. REMEDIES AND WAIVERS, PARTIAL INVALIDITY
33.1 Remedies and Waivers
No failure to exercise, nor any delay in exercising, on the part of
any Finance Party, any right or remedy under the Finance Documents
shall operate as a waiver thereof, nor shall any single or partial
exercise of any right or remedy prevent any further or other exercise
thereof or the exercise of any other right or remedy. The rights and
remedies herein provided are cumulative and not exclusive of any
rights or remedies provided by law.
33.2 Partial Invalidity
If, at any time, any provision of the Finance Documents is or becomes
illegal, invalid or unenforceable in any respect under the law of any
jurisdiction, neither the legality, validity or enforceability of the
remaining provisions thereof nor the legality, validity or
enforceability of such provision under the law of any other
jurisdiction shall in any way be affected or impaired thereby.
34. NOTICES
34.1 Communications in Writing
Each communication to be made under the Finance Documents shall be
made in writing and, unless otherwise stated, shall be made by fax or
letter.
34.2 Addresses
Any communication or document to be made or delivered pursuant to the
Finance Documents shall be made or delivered to the address or fax
number (and the department or officer, if any, for whose attention
the communication is made):
34.2.1 in the case of an Obligor, the Security Trustee and the
Agent, identified with its name below:
(a) to the Obligors, to:
NTL Communications Corp.
(to be renamed NTL Incorporated)
Address: 110 East 59th Street
26th Floor
New York
NY 10022
USA
Fax: 001 212 906 8497
Attention: Richard J. Lubasch/Lauren Hochman-Blair
120
Communications Cable Funding Corp.
Address: 110 East 59th Street
26th Floor
New York
NY 10022
USA
Fax: 001 212 906 8497
Attention: Richard J. Lubasch/Lauren Hochman-Blair
NTL (UK) Group, Inc.
Address: NTL House
Bartley Wood Business Park
Hook
Hampshire
RG27 9UP
Fax: 020 7746 6820
Attention: The Company Secretary
With a copy to: 110 East 59th Street
26th Floor
New York
NY 10022
USA
Fax: 001 212 906 8497
Attention: Richard J. Lubasch/Lauren Hochman-Blair
NTL Communications Limited
Address: NTL House
Bartley Wood Business Park
Hook
Hampshire
RG27 9UP
Fax: 020 7746 6820
Attention: The Company Secretary
121
With a copy to: 110 East 59th Street
26th Floor
New York
NY 10022
USA
Fax: 001 212 906 8497
Attention: Richard J. Lubasch/Lauren Hochman-Blair
(b) to the Security Trustee and/or the Agent, to:
J.P. Morgan Europe Limited
Address: 125 London Wall
London
Fax: 020 7777 2360
Attention: Steve Gillies
Loans Agency Department
34.2.2 in the case of each Bank, notified in writing to the Agent
prior to the date hereof (or, in the case of a Transferee,
at the end of the Transfer Certificate to which it is a
party as Transferee); and
or to any substitute address, fax number or department or officer as
the Security Trustee, an Obligor or a Bank may notify to the Agent
(or the Agent may notify to the Borrower (on its own behalf and on
behalf of the other Obligors), the Security Trustee and the Banks, if
a change is made by the Agent) by not less than five Business Days'
Borrower notice. Any communication to be made to an Obligor (other
than the Borrower) by fax shall be made to the fax number identified
with the Borrower's name below. Any communication or document to be
made or delivered (a) to an Obligor (other than the Borrower) shall
be copied to the Borrower and (b) to any Obligor (other than the
Parent) to the Parent.
34.3 Delivery
Any communication or document to be made or delivered by one person
to another under or in connection with the Finance Documents shall
only be effective:
34.3.1 if by way of fax, when received in legible form;
34.3.2 if by way of letter, when left at the relevant address or,
as the case may be, five days after being deposited in the
post postage prepaid in an envelope addressed to it at such
address; and
34.3.3 if a particular department or officer is specified as part
of the address details provided under Clause 34.2
(Addresses), if addressed to that department or officer,
122
provided that any communication or document to be made or delivered
to the Agent shall be effective only when received by its agency
division and then only if the same is expressly marked for the
attention of the department or officer identified with the Agent's
signature below (or such other department or officer as the Agent
shall from time to time specify for this purpose).
34.4 The Agent
All notices from or to an Obligor shall be sent through the Agent.
34.5 English Language
Each communication and document made or delivered by one party to
another pursuant to the Finance Documents shall be in the English
language or accompanied by a translation thereof into English
certified (by an officer of the person making or delivering the same)
as being a true and accurate translation thereof.
34.6 Notification of Changes
Promptly upon receipt of notification of a change of address or fax
number pursuant to Clause 34.2 (Addresses) or changing its own
address or fax number the Agent shall notify the other parties hereto
of such change.
34.7 Deemed Receipt by the Obligors
Any communication or document made or delivered to the Borrower in
accordance with Clause 34.3 (Delivery) shall be deemed to have been
made or delivered to each of the Obligors.
34.8 Electronic Communication
34.8.1 Any communication to be made between the Agent and a Bank
under or in connection with the Finance Documents may be
made by electronic mail or other electronic means, if the
Agent and the relevant Bank:
(a) agree that, unless and until notified to the
contrary, this is to be an accepted form of
communication;
(b) notify each other in writing of their electronic
mail address and/or any other information required
to enable the sending and receipt of information by
that means; and
(c) agree that they will notify each other of any change
to their address or any other such information
supplied by them.
34.8.2 Any electronic communication made between the Agent and a
Bank will be effective only when actually received in
readable form and in the case of any electronic
communication made by a Bank to the Agent only if it is
addressed in such a manner as the Agent shall specify for
this purpose.
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35. COUNTERPARTS
This Agreement may be executed in any number of counterparts, all of
which taken together shall constitute one and the same instrument.
36. AMENDMENTS
36.1 Amendments
If the Agent has the prior consent of an Instructing Group (or the
Steering Committee Group is so provided under Clause 36.4 (Amendments
Requiring the Consent of the Steering Committee Group), the Agent,
the Borrower and the Obligors party to a Finance Document may from
time to time agree in writing to amend such Finance Document or, as
the case may be, the Agent may consent to or waive, prospectively or
retrospectively, any of the requirements of such Finance Document and
any amendments or waivers so agreed or consents so given shall be
binding on all the Finance Parties, provided that no such waiver or
amendment shall subject any Finance Party hereto to any new or
additional obligations without the consent of such Finance Party.
36.2 Amendments Requiring the Consent of all the Banks
An amendment or waiver which relates to:
36.2.1 Clause 28 (Sharing) or this Clause 36.2;
36.2.2 a change in the principal amount of or currency of any
Advance (other than pursuant to Clause 31 (Change of
Currency)), or deferral of the Final Maturity Date;
36.2.3 a change in the Margin, the amount of any payment of
interest, fees or any other amount payable hereunder to any
Finance Party or deferral of the date for payment thereof;
36.2.4 Clause 20 (Guarantee and Indemnity);
36.2.5 a release of any of the Security;
36.2.6 a Security Document, where such an amendment or waiver could
affect the nature or scope of the property subject to the
Security;
36.2.7 an increase in the commitment of a Bank;
36.2.8 a change to the Borrower or Guarantors (other than in
accordance with Clause 37 (Accession of Guarantors);
36.2.9 Clause 2.4 (Banks' Obligations Several) and Clause 2.5
(Banks' Rights Several);
36.2.10 the definition of Instructing Group, Permitted Encumbrance
or Potential Event of Default; or
124
36.2.11 any provision which contemplates the need for the consent or
approval of all the Banks,
shall not be made without the prior consent of all the Banks.
36.3 Exceptions
Notwithstanding any other provisions hereof, the Agent shall not be
obliged to agree to any such amendment or waiver if the same would:
36.3.1 amend or waive this Clause 36 (Amendments), Clause 22 (Costs
and Expenses) or Clause 29 (The Agent, the Arrangers and the
Banks); or
36.3.2 otherwise amend or waive any of the Agent's rights hereunder
or subject the Agent or the Arrangers to any additional
obligations hereunder.
36.4 Amendments Requiring the Consent of the Steering Committee Group
An amendment or waiver to Clause 9.5 (Mandatory Prepayment from
Capital Event Proceeds) or the definitions of "Capital Event
Proceeds" or "Required Percentage" may be made by the Agent acting
upon the instructions of the Steering Committee Group.
37. ACCESSION OF GUARANTORS
37.1 Request for Guarantor
The Parent may request that any member of the Parent Covenant Group
become a Guarantor by delivering to the Agent a Guarantor Accession
Memorandum (amended in the case of the Parent in the manner indicated
in the Restatement Amendment Agreement) duly executed by the Parent
and such member of the Parent Covenant Group, together with the
documents and other evidence listed in Schedule 8 (Additional
Conditions Precedent) in relation to such member.
37.2 Guarantor Conditions Precedent
A company, in respect of which the Parent has delivered a Guarantor
Accession Memorandum to the Agent, shall become a Guarantor and
assume all the rights, benefits and obligations of a Guarantor as if
it has been an original party hereto as a Guarantor on the date on
which the Agent notifies the Parent that it has received, in form and
substance satisfactory to it, all the documents and other evidence
listed in Schedule 8 (Additional Conditions Precedent).
38. GOVERNING LAW
This Agreement is governed by English law.
39. JURISDICTION
39.1 English Courts
The courts of England have exclusive jurisdiction to settle any
dispute (a "Dispute") arising out of or in connection with this
Agreement (including a dispute regarding the
125
existence, validity or termination of this Agreement or the
consequences of its nullity).
39.2 Convenient Forum
The parties agree that the courts of England are the most appropriate
and convenient courts to settle Disputes between them and,
accordingly, that they will not argue to the contrary.
39.3 Non-Exclusive Jurisdiction
This Clause 39 (Jurisdiction) is for the benefit of the Finance
Parties only. As a result and notwithstanding Clause 39.1 (English
Courts), it does not prevent any Finance Party from taking
proceedings relating to a Dispute ("Proceedings") in any other courts
with jurisdiction. To the extent allowed by law, the Finance Parties
may take concurrent Proceedings in any number of jurisdictions.
39.4 Service of Process
Each Guarantor agrees that the documents which start any Proceedings
and any other documents required to be served in relation to those
Proceedings may be served on it by service of such documents on NTL
Group Limited at NTL House, Bartley Wood Business Park, Hook,
Hampshire RG27 9XA (marked for the attention of Robert Mackenzie) or,
if different, its registered office.
If any Guarantor ceases to have a place of business in Great Britain
or, as the case may be, the appointment of the person mentioned in
this Clause 39.4 ceases to be effective, such person shall
immediately appoint another person in England to accept service of
process on its behalf in England. If any Guarantor fails to do so
(and such failure continues for a period of not less than fourteen
days), the Agent shall be entitled to appoint such a person by notice
to such person. Nothing contained herein shall restrict the right to
serve process in any other manner allowed by law. This Clause 39.4
applies to Proceedings in England and to Proceedings elsewhere.
40. INTERCREDITOR AGREEMENT
Each Obligor acknowledges that the Banks have entered into the
Intercreditor Agreement (including, without limitation, Clause 2.1
(Waiver of Drawdown Conditions) thereof and that they have been
provided with a copy thereof. Each Obligor acknowledges that (x)
neither it nor any other member of the Group nor any other person
shall be deemed to be a third party beneficiary of the Intercreditor
Agreement or have any right to enforce or cause the enforcement of
any right, remedy or obligation of any party to the Intercreditor
Agreement and (y) the terms of the Intercreditor Agreement can be
amended, modified, waived or terminated without their consent. The
Agent shall notify the Borrower of any such amendment, modification,
waiver or termination promptly after its occurrence.
126
SCHEDULE 1
The Banks
Bank Commitment
JP Morgan Chase Bank (pound)142,898,005.92
(formerly The Chase Manhattan Bank)
Morgan Stanley Dean Witter Bank Limited (pound)142,898,005.92
Bank of America, N.A. (pound)20,414,000.85
BNP Paribas (pound)20,414,000.85
CIBC World Markets PLC (pound)20,414,000.85
The Royal Bank of Scotland plc (pound)20,414,000.85
Goldman Sachs Credit Partners (pound)40,828,001.69
---------------------
(pound)408,280,016.92
=====================
127
SCHEDULE 2
Form of Transfer Certificate
To: J.P. Morgan Europe Limited (formerly Chase Manhattan
International Limited)
as Agent
TRANSFER CERTIFICATE
relating to the agreement (as from time to time amended and restated,
varied, novated or supplemented, the "Credit Agreement") dated 30 May
2000 whereby a (pound)1,300,000,000 multiple draw loan facility was
made available to NTL Communications Limited by a group of banks on
whose behalf JP Morgan Europe Limited (formerly known as Chase
Manhattan International Limited) acted as agent in connection
therewith.
1. Terms defined in the Credit Agreement shall, subject to any contrary
indication, have the same meanings herein. The terms Bank, Transferee
and Portion Transferred are defined in the schedule hereto.
2. The Bank (i) confirms that the details in the schedule hereto under
the heading "Bank's Participation in the Facility" and ["Advances"]
accurately summarises its participation in the Credit Agreement and
the Interest Period or Term of any existing Advances and (ii)
requests the Transferee to accept and procure the transfer by
novation to the Transferee of the Portion Transferred (specified in
the schedule hereto) of its Commitment and/or its participation in
such Advance(s) by counter-signing and delivering this Transfer
Certificate to the Agent at its address for the service of notices
specified in the Credit Agreement.
3. The Transferee hereby requests the Agent to accept this Transfer
Certificate as being delivered to the Agent pursuant to and for the
purposes of Clause 30.5 (Transfers by Banks) of the Credit Agreement
so as to take effect in accordance with the terms thereof on the
Transfer Date or on such later date as may be determined in
accordance with the terms thereof.
4. The Transferee confirms that it has received a copy of the Credit
Agreement together with such other information as it has required in
connection with this transaction and that it has not relied and will
not hereafter rely on the Bank to check or enquire on its behalf into
the legality, validity, effectiveness, adequacy, accuracy or
completeness of any such information and further agrees that it has
not relied and will not rely on the Bank to assess or keep under
review on its behalf the financial condition, creditworthiness,
condition, affairs, status or nature of the Parent Covenant Group or
the Obligors.
5. The Transferee hereby undertakes with the Bank and each of the other
parties to the Credit Agreement that it will perform in accordance
with their terms all those obligations which by the terms of the
Finance Documents will be assumed by it after
128
delivery of this Transfer Certificate to the Agent and satisfaction
of the conditions (if any) subject to which this Transfer Certificate
is expressed to take effect.
6. The Bank makes no representation or warranty and assumes no
responsibility with respect to the legality, validity, effectiveness,
adequacy or enforceability of the Finance Documents or any document
relating thereto and assumes no responsibility for the financial
condition of the Obligors or for the performance and observance by
the Obligors of any of its obligations under the Finance Documents or
any document relating thereto and any and all such conditions and
warranties, whether express or implied by law or otherwise, are
hereby excluded.
7. The Bank hereby gives notice that nothing herein or in the Finance
Documents (or any document relating thereto) shall oblige the Bank to
(a) accept a re-transfer from the Transferee of the whole or any part
of its rights, benefits and/or obligations under the Finance
Documents transferred pursuant hereto or (b) support any losses
directly or indirectly sustained or incurred by the Transferee for
any reason whatsoever including the non-performance by an Obligor or
any other party to the Finance Documents (or any document relating
thereto) of its obligations under any such document. The Transferee
hereby acknowledges the absence of any such obligation as is referred
to in (a) or (b) above.
8. This Transfer Certificate and the rights, benefits and obligations of
the parties hereunder shall be governed by and construed in
accordance with English law.
THE SCHEDULE
1. Bank:
2. Transferee:
3. Transfer Date:
4. Bank's Participation in the Facility:
5. Advance(s): [Term and Portion Transferred
Repayment Date]
Amount of Bank's Participation [Transferor Bank] [Transferor Bank]
6. Portion Transferred of the Take Down Fee payable in respect of
Future Advances
By: By:
Date: Date:
129
______________________________________________________________________
ADMINISTRATIVE DETAILS OF TRANSFEREE
Address:
Contact Name:
Account for Payments:
Telex:
Fax:
Telephone:
______________________________________________________________________
Note: Each Transferee should, at the same time as executing this
Transfer Certificate, execute an accession memorandum in relation to
the Security Trust Agreement and the Intercreditor Agreement.
130
SCHEDULE 3
Existing Encumbrances
The Encumbrances set forth in Schedule 5 to the Senior Bank Credit Agreement
as in effect at the Restatement Amendment Effective Time.
131
SCHEDULE 4
Form of Compliance Certificate
To: J.P. Morgan Europe Limited as Agent
Date:
Dear Sirs,
1. We refer to an agreement (the "Credit Agreement") dated 30 May 2000
and originally made between, among others, NTL Communications Limited
as the Borrower, Morgan Stanley Dean Witter Bank Limited and J.P.
Morgan PLC (formerly Chase Manhattan Plc) as arrangers and joint bank
managers, J.P. Morgan Europe Limited (formerly Chase Manhattan
International Limited) as agent and the financial institutions
defined therein as Banks (as amended and restated, varied, novated or
supplemented from time to time).
2. Terms defined in the Credit Agreement shall bear the same meaning
herein.
3. We confirm that:
(a) *The ratio of the UK Group Net Consolidated Total Debt on
[Quarter Date] to the Consolidated [Annualised] EBITDA of
the UK Group for the [Relevant Period/financial year] ended
on [Quarter Date] was [ ]:1.
(b) *The ratio of the Consolidated EBITDA of the UK Group for
the [Relevant Period/financial year] ended on [Quarter Date]
to the aggregate of UK Group Total Interest Payable, UK
Group Capital Expenditure and Permitted Payments for that
[Relevant Period/financial year] was [ ]:1.
(c) ***The aggregate amount of Liquidity of members of the UK
Group and members of the Parent Covenant Group on [Quarter
Date] was [o],
(d) **[The ratio of the Group Net Consolidated Total Debt on
[Quarter Date] to the Consolidated [Annualised] EBITDA of
the Group for the [Relevant Period /financial year] ended on
[Quarter Date] was [ ]:1
- --------
* Delete in Compliance Certificate delivered by New NTL
** Delete in Compliance Certificate delivered by the Borrower
***Delete in Compliance Certificate delivered by New NTL and in Compliance
Certificate determined in respect of annual statements
132
The calculation of the above ratios are set out in the Schedule to
this Compliance Certificate.
4. We also confirm that the amount of Excess Cash Flow as at [ ] was
(pound)[ ], and furthermore that the Excess Cash Flow Payment Amount
payable in respect of the period ending on [ ] is (pound)[ ].
Signed:
Authorised Signatory of Authorised Signatory of
NTL Communications Limited NTL Communications Limited
........................... ...........................
133
THE SCHEDULE TO COMPLIANCE CERTIFICATE
Compliance Certificate Calculations
Definitions used in this Schedule shall bear the same meanings as
those ascribed to them in the Senior Bank Credit Agreement.
(A) Ratio of UK Group Net Consolidated Total Debt to Consolidated [Annualised]
EBITDA of the UK Group:
1. UK Group Net Consolidated Total Debt:
Principal amount outstanding under the Facility and __________________
principal amount outstanding under the Working
Capital Facility (including capitalised interest):
Other relevant Indebtedness for Borrowed Money: __________________
Minus
Cash held by members of the UK Group (subject to a ___________________
maximum amount of (pound)100,000,000 or its
equivalent in other currencies)
UK Group Net Consolidated Total Debt ___________________
2. Consolidated [Annualised] EBITDA of the UK Group:
(All line items below refer to the Relevant Period, save in the case
of the Compliance Certificate which accompanies any financial
statements delivered pursuant to Clause 16.1 (Annual Statements),
where the line items refer to the then most recently ended financial
year)
UK Group consolidated net income ___________________
Plus
Any tax provisions ___________________
Plus
Any interest, commissions, discounts or other fees in respect of
Indebtedness for Borrowed Money, and any amounts related to interest
hedging arrangements entered into in respect of the
Revolving Facility or the Term Facility ___________________
Plus
134
Any Allowable Exceptional Items and other items
under paragraph (d) of the definition of EBIT ___________________
Plus
Separation/Integration costs and payments made
under Schedule 8 of the Transaction Agreement ___________________
Plus
Any amortisation and depreciation ___________________
Minus
Capitalised costs and expenses ___________________
[Consolidated EBITDA of the UK Group for the
Relevant Period ___________________
Multiplied by 2]
Consolidated [Annualised] EBITDA of the UK Group
___________________
3. Ratio:
(B) Ratio of Consolidated EBITDA of the UK Group to the aggregate of UK
Group Total Interest Payable, UK Group Capital Expenditure and
Permitted Payments:
1. Consolidated EBITDA of the UK Group for the Relevant Period:
(All line items below refer to the Relevant Period)
Consolidated EBITDA of the UK Group.
2. UK Group Total Interest Payable, UK Group Capital Expenditure and
Permitted Payments:
(All line items below refer to the Relevant Period, save in the case of
the Compliance Certificate which accompanies any financial statements
delivered pursuant to Clause 16.1 (Annual Statements), where the line
items refer to the then most recently ended financial year)
Aggregate amount of interest, commission, fees and
other periodic finance payments accrued on UK Group
Consolidated Total Debt ___________________
Plus
135
Commission, fees and finance payments accrued by UK
Group under interest hedging arrangements ___________________
Minus
Commission, fees and finance payments accrued in
favour of UK Group under interest hedging
arrangements permitted by the Senior Bank Credit
Agreement ___________________
Minus
Any interest accrued in favour of UK Group on
deposits or bank accounts ___________________
Plus
UK Group Capital Expenditure accrued ___________________
Plus
Permitted Payments made ___________________
UK Group Total Interest Payable, UK Group Capital
Expenditure and Permitted Payments for the
[Relevant Period/financial year] ___________________
3. Ratio:
(C) Aggregate amount of Liquidity of members of the UK Group and members of
the Parent Covenant Group
1. Available Cash of members of the Covenant
Group ___________________
Plus
Available Cash of members of the UK Group ___________________
Plus
Available Revolving Facility ___________________
Plus
Investments of Obligors or members of the
Covenant Group falling within paragraphs (b)
or (c) of the definition of Permitted
Investments and which are held with an
Eligible Deposit Bank ___________________
136
2. Liquidity of members of the UK Group
and members of the Covenant Group ___________________
(D) Ratio of Group Net Consolidated Total Debt to Consolidated Annualised
EBITDA of the Group:
1. Group Net Consolidated Total Debt:
Principal amount outstanding under the Facility and
principal amount outstanding under the Working
Capital Facility (including capitalised interest) ___________________
Plus
Other relevant Indebtedness for Borrowed Money of the
UK Group ___________________
Plus
Principal amount outstanding under the Exit
Financing, the Triangle Notes, the Diamond Holdings
Notes and other relevant Indebtedness for Borrowed
Money ___________________
Minus
Cash, in cleared balances, held by members of the
Group (subject to a maximum amount
of(pound)150,000,000 or its equivalent in other
currencies) ___________________
Group Net Consolidated Total Debt ___________________
2. Consolidated [Annualised] EBITDA of the Group:
(All line items below refer to the Relevant Period, save in the case
of the Compliance Certificate which accompanies any financial
statements delivered pursuant to Clause 16.1 (Annual Statements),
where the line items refer to the then most recently ended financial
year)
Group consolidated net income ___________________
Plus
Any tax provisions ___________________
Plus
Any interest, commissions, discounts or other fees in
137
respect of Indebtedness for Borrowed Money and any
amounts related to interest hedging arrangements
entered into in respect of the Revolving Facility or
the Term Facility ___________________
Plus
Any amounts paid pursuant to interest hedging
arrangements entered into in respect of Permitted
Covenant Group Indebtedness ___________________
Plus
Any Allowable Exceptional Items and other items under
paragraph (d) of the definition of EBIT ___________________
Plus
Separation/Integration costs and payments made under
Schedule 8 of the Transaction Agreement ___________________
Plus
Any amortisation and depreciation ___________________
Minus
Capitalised costs and expenses
Consolidated EBITDA of the Group for the
Relevant Period ___________________
[Multiplied by 2
Consolidated [Annualised] EBITDA of the Group] ____________________
3. Ratio
138
SCHEDULE 5
Mandatory Costs
1. The Mandatory Cost Rate is an addition to the interest rate to
compensate Banks for the cost of compliance with (a) the requirements
of the Bank of England and/or the Financial Services Authority (or,
in either case, any other authority which replaces all or any of its
functions) or (b) the requirements of the European Central Bank.
2. On the first day of each Interest Period (or as soon as possible
thereafter) the Agent shall calculate, as a percentage rate, a rate
(the "additional costs rate") for each Bank, in accordance with the
formula set out below. The Mandatory Cost Rate will be calculated by
the Agent as a weighted average of the Banks' additional costs rates
rounded to five decimal places (weighted in proportion to the
percentage participation of each Bank in the relevant Advance) and
will be expressed as a percentage rate per annum.
3. The additional costs rate for any Bank lending from a Facility Office
in a Participating Member State will be the percentage notified by
that Bank to the Agent. This percentage will be certified by that
Bank in its notice to the Agent to be its reasonable determination of
the cost (expressed as a percentage of that Bank's participation in
all Advances made from that Facility Office) of complying with the
minimum reserve requirements of the European Central Bank in respect
of loans made from that Facility Office.
4. The additional cost rate for any Bank lending from a Facility Office
in the United Kingdom will be calculated by the Agent as follows:
AB + C(B-D) + E x0.01
---------------------- per cent. per annum.
100 - (A + C)
Where:
A is the percentage of Eligible Liabilities (assuming these to
be in excess of any stated minimum) which that Bank is from
time to time required to maintain as an interest free cash
ratio deposit with the Bank of England to comply with cash
ratio requirements.
B is the percentage rate of interest (excluding the Margin and
the Mandatory Cost Rate and, if the Advance is an Unpaid
Sum, the additional rate of interest specified in Clause
23.2 (Default Interest) payable for the relevant Interest
Period of the Loan.
C is the percentage (if any) of Eligible Liabilities which
that Bank is required from time to time to maintain as
interest bearing Special Deposits with the Bank of England.
D is the percentage rate per annum payable by the Bank of
England to the Agent on interest bearing Special Deposits.
E is designed to compensate the Banks for amounts payable
under the Fees Rules and is calculated by the Agent as being
the average of the most recent
139
rates of charge supplied by the Reference Banks to the Agent
pursuant to paragraph 7 below and expressed in pounds per
(pound)1,000,000.
5. For the purposes of this Schedule:
(a) "Eligible Liabilities" and "Special Deposits" have the
meanings given to them from time to time under or pursuant
to the Bank of England Act 1998 or (as may be appropriate)
by the Bank of England;
(b) "Fees Rules" means the rules on periodic fees contained in
the FSA Supervision Manual or such other law or regulation
as may be in force from time to time in respect of the
payment of fees for the acceptance of deposits;
(c) "Fee Tariffs" mean the fee tariffs specified in the Fees
Rules under the activity group A.1. Deposit acceptors
(ignoring any minimum fee or zero rated fee required
pursuant to the Fees Rules but taking into account any
applicable discount rate; and
(d) "Tariff Base" has the meaning given to it in, and will be
calculated in accordance with, the Fees Rules.
6. In application of the above formula, A, B, C and D will be included
in the formula as percentages (i.e. 5 per cent. will be included in
the formula as 5 and not as 0.05). A negative result obtained by
subtracting D from B shall be taken as zero. The resulting figure
shall be rounded to four decimal places.
7. If requested by the Agent, each Reference Bank shall, as soon as
practicable after publication by the Financial Services Authority,
supply to the Agent, the rate of charge payable by that Reference
Bank to the Financial Services Authority pursuant to the Fees Rules
in respect of the relevant financial year of the Financial Services
Authority (calculated for this purpose by that Reference Bank as
being the average of the Fee Tariff applicable to that Reference Bank
for that financial year) and expressed in pounds per (pound)1,000,000
of the Tariff Base of that Reference Bank.
8. Each Bank shall supply any information required by the Agent for the
purpose of calculating its additional costs rate. In particular, but
without limitation, each Bank shall supply the following information
in writing on or prior to the date on which it becomes a Bank:
(a) the jurisdiction of its Facility Office; and
(b) such other information that the Agent may reasonably require
for such purpose.
Each Bank shall promptly notify the Agent in writing of any change to
the information provided by it pursuant to this paragraph.
9. The percentages of each Bank for the purpose of A and C above and the
rates of charge of each Reference Bank for the purpose of E above
shall be determined by the Agent based upon the information supplied
to it pursuant to paragraphs 7 and 8 above and on the assumption that
unless a Bank notifies the Agent to the contrary, each Bank's
obligations in relation to cash ratio deposits and Special Deposits
are the same
140
as those of a typical bank from its jurisdiction of incorporation with
a Facility Office in the same jurisdiction as its Facility Office.
10. The Agent shall have no liability to any person if such determination
results in an additional costs rate which over or under compensates
any Bank and shall be entitled to assume that the information
provided by any Bank or Reference Bank pursuant to paragraphs 3, 7
and 8 above is true and correct in all respects.
11. The Agent shall distribute the additional amounts received pursuant
to the Mandatory Cost Rate to the Banks on basis of the additional
cost rate for each Bank, as calculated in accordance with the above
formula and based on the information provided by each Bank pursuant
to paragraphs 3, 7 and 8 above.
12. Any determination by the Agent pursuant to this Schedule in relation
to a formula, the Mandatory Cost Rate, an additional costs rate or
any amount payable to a Bank shall, in the absence of manifest error,
be conclusive and binding on all of the parties hereto.
13. The Agent may from time to time, after consultation with the Parent,
the Borrower and the Banks, determine and notify to all parties any
amendments or variations which are required to be made to this
Schedule in order to comply with any change in law, regulation or any
requirements from time to time imposed by the Bank of England, the
Financial Services Authority or the European Central Bank (or, in
either case, any other authority which replaces all or any of its
functions) and any such determination shall, in the absence of
manifest error, be conclusive and binding on all the parties hereto.
141
SCHEDULE 6
Form of Non-Bank Certificate
Reference is hereby made to the Credit Agreement, dated as of
[_________________], 2000, among NTL COMMUNICATIONS LIMITED and
various Finance Parties from time to time party thereto (as amended,
modified or supplemented from time to time, the "Agreement").
Pursuant to the provisions of Clause 10.4 (US Tax Forms) of the
Agreement, the undersigned hereby certifies that it is not a "bank"
as such term is used in Section 881(c)(3)(A) of the Internal Revenue
Code of 1986, as amended.
[NAME OF BANK]
By_____________________________
Title:
Date: _________________________
142
SCHEDULE 7
Form of Guarantor Accession Memorandum
To: J.P. Morgan Europe Limited (formerly Chase Manhattan
International Limited)
as Agent
From: [Subsidiary]
and
Communications Cable Funding Corp. (the "Parent")
Dated:
Dear Sirs,
1. We refer to an agreement (the "Credit Agreement") dated 30 May 2000
and originally made between, among others, NTL Communications
Corporation, NTL (UK) Group, Inc., Morgan Stanley Dean Witter Bank
Limited and J.P. Morgan PLC (formerly Chase Manhattan Plc), as
arrangers and joint book managers, J.P. Morgan Europe Limited
(formerly Chase Manhattan International Limited) as agent and the
financial institutions defined therein as Banks (as amended and
restated from time to time).
2. Terms defined in the Credit Agreement shall bear the same meaning
herein.
3. The Parent requests that [Subsidiary] become a Guarantor pursuant to
Clause 37 (Accession of Guarantors) of the Credit Agreement.
4. [Subsidiary] is a company duly organised under the laws of [name of
relevant jurisdiction].
5. [Subsidiary] confirms that it has received from the Parent a true and
up-to-date copy of the Credit Agreement and a list of the Borrowers
as at the date hereof.
6. [Subsidiary] undertakes, upon its becoming a Guarantor, to perform
all the obligations expressed to be undertaken under the Credit
Agreement by a Guarantor and agrees that it shall be bound by the
Credit Agreement in all respects as if it had been an original party
thereto as a Guarantor.
7. The [Subsidiary]:
(a) makes the Repeated Representations (other than those
representations and warranties set out in Clause 15.9
(Audited Financial Statements) and Clause 15.14 (Group
Structure)) with respect to itself; and
(b) confirms that no Event of Default or Potential Event of
Default is continuing or would occur as a result of
[Subsidiary] becoming a Guarantor.
8. [Subsidiary's] administrative details are as follows:
143
Address:
Fax No.:
9. [Process Agent1
[Subsidiary] agrees that the documents which start any Proceedings
and any other documents required to be served in relation to those
Proceedings may be served on it at [address of Subsidiary's place of
business in England] or at any address in Great Britain at which
process may be served on it in accordance with Part XXIII of the
Companies Act 1985] / [on name of process agent in England at address
of process agent or, if different, its registered office. If
[Subsidiary] ceases to have a place of business in Great Britain]/[
the appointment of the person mentioned above ceases to be
effective], [Subsidiary] shall immediately appoint another person in
England to accept service of process on its behalf in England. If it
fails to do so (and such failure continues for a period of not less
than fourteen days), the Agent shall be entitled to appoint such a
person by notice. Nothing contained herein shall restrict the right
to serve process in any other manner allowed by law. This applies to
Proceedings in England and to Proceedings elsewhere.]
10. This Memorandum shall be governed by English law.
11. This Memorandum is executed and delivered as a deed by [Subsidiary].
[Name of Subsidiary]
By: ..................................
Name:
Title:
Communications Cable Funding Corp.
By: ..................................
Name:
Title:
____________________________
1 This clause is required only if the Guarantor is not incorporated in
England or Wales.
144
SCHEDULE 8
Additional Conditions Precedent
1. A copy, certified as at the date of the Guarantor Accession
Memorandum a true and up-to-date copy by an Authorised Signatory of
the proposed Guarantor, of the constitutional documents of such
proposed Guarantor.
2. A copy, certified as at the date of the Guarantor Accession
Memorandum a true and up-to-date copy by an Authorised Signatory of
the proposed Guarantor, of a board resolution of such proposed
Guarantor approving the execution and delivery of a Guarantor
Accession Memorandum, the accession of such proposed Guarantor to
this Agreement and the performance of its obligations under the
Finance Documents and authorising a named person or persons to sign
such Guarantor Accession Memorandum, any other Finance Document and
any other documents to be delivered by such proposed Guarantor
pursuant thereto.
3. A certificate of an Authorised Signatory of the proposed Guarantor
setting out the names and signatures of the person or persons
authorised to sign, on behalf of such proposed Guarantor, the
Guarantor Accession Memorandum, any other Finance Documents and any
other documents to be delivered by such proposed Guarantor pursuant
thereto.
4. An opinion of counsel to the proposed Guarantor in form and substance
reasonably satisfactory to the Agent.
5. A certificate executed by an Authorised Signatory of such Guarantor
and the Parent certifying that (i) such Guarantor is a newly formed
corporation organised under the laws of the United States (or any
state therein), (ii) such Guarantor has no liabilities other than
pursuant to the Finance Documents or inter-company loans incurred
from its direct parent company which are subject to a Subordination
Agreement, (iii) such Guarantor has no assets other than
inter-company loans made to its direct subsidiary which are subject
to a Subordination Agreement and the capital stock of its direct
subsidiary all of which are subject to a first priority lien pursuant
to the Security Documents (or in the case such Guarantor is the
direct parent of the Borrower, 65% of such capital stock) and (iv)
100% of the capital stock of such Guarantor is subject to a first
priority lien pursuant to the Security Documents.
6. A deed of accession to the Security Trust Agreement executed by the
proposed Guarantor, substantially in the form set out in Schedule 1
(Form of Obligor Deed of Accession) to the Security Trust Agreement.
145
SCHEDULE 9
Historic Representations
Unless otherwise provided, each capitalised term used in this Schedule 9, each
capitalised term used in the Clauses referred to in this Schedule 9 and each
definition used in any of such capitalised terms, shall for the purposes of
interpretation of this Schedule 9, bear the meanings ascribed to those terms
in the form of this Agreement in force at the time the relevant representation
and warranty was made or deemed to be repeated and each reference to a Clause
number in Section B of this Schedule 9 shall, for the purposes of
interpretation of Part B of Schedule 9, be to the Clause bearing such number
in the form of this Agreement in force as at the time the relevant
representation and warranty was made or deemed to be repeated. This Schedule 9
does not serve to amend or vary the form of any representation made or deemed
to be repeated or the identity of any party described as making such
representation but is intended solely as a description of the content of such
representations and warranties, when such representations and warranties were
made or deemed repeated and the identities of the parties making such
representations. The contents of this Schedule 9 shall create no additional
legal obligations on the parties making or deemed to be making such
representations over and above the obligations contained in this Agreement in
the form in force as at the time such representation was made or deemed
repeated.
A. Representing Parties
1. On the Execution Date, each Covenant Group Obligor made the
representations and warranties set out in paragraph 1 (Status and Due
Authorisation) to paragraph 28 (The Scheme) of Section B (Historic
Representations) of this Schedule 9; provided that insofar as the
representations and warranties set out in sub-paragraph (c) of
paragraph 14 (Business Plan and Information Memorandum) and paragraph
26 (Group Structure) of Section B (Historic Representations) of this
Schedule 9 relate to the Target Group, the Borrower made such
representations and warranties to the best of its knowledge and
belief and without liability to pay damages for breach thereof.
2. On the Execution Date, New NTL made the representations and
warranties set out in paragraph 1 (Status and Due Authorisation) to
paragraph 7 (No Winding-Up), paragraph 20 (Execution of this
Agreement) and paragraph 25 (Security Interest) of Section B
(Historic Representations) of this Schedule 9 with respect to itself
(as applicable).
3. Each Obligor acknowledged that the Finance Parties entered into the
Finance Documents in reliance on those representations and
warranties.
4. The representations and warranties set out in paragraphs 1 (Status
and Due Authorisation), 3 (No Immunity), 6 (Binding Obligations), 8
(No Material Defaults) to 10 (Audited Financial Statements), 15
(Budgets), 20 (Execution of this Agreement), 24 (Intellectual
Property), 25 (Security Interest) and 26 (Group Structure) of Section
B (Historic Representations) of this Schedule 9 were deemed to be
repeated by New NTL, the Intermediate Parent and the Borrower on each
date on which an Advance was made and the representation set out in
sub-paragraph (c) of paragraph 14 (Business Plan and Information
Memorandum) of Section B was deemed to have been made on the date
that the Information Memorandum was approved by the Borrower and
(save as disclosed by the Borrower in writing to the Agent, prior to
the Syndication Date) on the Syndication Date.
146
B. Historic Representations
1. Status and Due Authorisation
It is duly organised under the laws of the jurisdiction in which it
is established or incorporated with power to enter into each of the
Finance Documents to which it is a party and to exercise its rights
and perform its obligations thereunder and all corporate and other
action required to authorise its execution of each of the Finance
Documents to which it is a party and its performance of its
obligations thereunder has been duly taken. No limit on its powers
will be exceeded as a result of the borrowings, granting of security
or giving of guarantees contemplated by the Finance Documents to
which it is a party.
2. No Deductions or Withholding; Entity Classification Election
Under the laws of its jurisdiction in which it is established or
incorporated in force at the Execution Date (as such term is defined
in this Agreement), it will not be required to make any deduction or
withholding from any payment it may make under any Finance Document
to any Bank which is a Qualifying Lender (assuming in the case of a
Treaty Lender, that it has secured a direction from the UK Inland
Revenue to pay interest gross and assuming in the case of United
States taxes that the tax forms required to be provided in Clause
10.4 (U.S. Tax Forms) have been so provided). The Borrower has filed
a valid election to be treated as a disregarded entity for U.S.
federal income tax purposes and such election currently remains in
effect.
3. No Immunity
In any proceedings taken in the jurisdiction in which it is
incorporated or established in relation to any Finance Document to
which it is party, it is not entitled to claim for itself or any of
its assets immunity from suit, execution, attachment or other legal
process.
4. Validity and Admissibility in Evidence
All acts, conditions and things required to be done, fulfilled and
performed in order:
(a) to enable it lawfully to enter into, exercise its rights
under and perform and comply with the obligations expressed
to be assumed by it in each of the Finance Documents to
which it is party;
(b) to ensure that the obligations expressed to be assumed by it
in each such Finance Document are legal, valid and (subject
to the Reservations) binding and enforceable; and
(c) (subject to the Reservations) to make each such Finance
Document admissible in evidence in England and the United
States,
have been done, fulfilled and performed (other than the registration
of the Encumbrances created by the Security Documents with the
Registrar of Companies under Sections 395 and 398 of the Companies
Act 1985).
147
5. No Filing or Stamp Taxes
Under the laws of the jurisdiction in which it is incorporated or
established in force at the Execution Date (as such term is defined
in this Agreement), it is not necessary that any of the Finance
Documents to which it is a party be filed, recorded or enrolled with
any court or other authority in such jurisdiction or that any stamp,
registration or similar tax be paid on or in relation to any Finance
Document other than the entries in public registries referred to in
Clause 15.5 (Validity and Admissibility in Evidence) and fixed duties
on assignments by way of security.
6. Binding Obligations
The obligations expressed to be assumed by it in each Finance
Document to which it is expressed to be a party are legal and valid
obligations and (subject to the Reservations) binding on it and
enforceable against it in accordance with the terms thereof.
7. No Winding-up
No Obligor nor member of the UK Group has taken any corporate action
nor have any other steps been taken or legal proceedings been started
and served or (to the best of its knowledge and belief) threatened
against any Obligor or any member of the UK Group for its winding-up,
dissolution, administration or re-organisation or for the appointment
of a receiver, administrator, administrative receiver, trustee or
similar officer of it or of any or all of its assets or revenues
(other than for the purpose of a solvent reconstruction or
amalgamation of such Obligor or (as the case may be) such member of
the UK Group (where such would not cause any breach of this
Agreement) or for the purpose of the transfer of all or part of the
business and assets of any member of the UK Group to any other member
of the UK Group (provided that such transfer is permitted under the
terms of this Agreement)) and (save in the case of any action, steps
or proceedings relating to the appointment of an administrator) other
than where the relevant action, steps or proceedings are frivolous or
vexatious or being contested in good faith by appropriate legal
action and such action, steps or proceedings are discontinued (in any
such case) within 30 days of commencement.
8. No Material Defaults
No member of the Covenant Group is in breach of or in default under
any agreement to which it is a party (including, without limitation,
Material Commercial Contracts) or which is binding on it or any of
its assets and no party has terminated or is entitled to terminate
(on the basis of any breach of or default thereunder) any such
agreement to an extent or in a manner which could reasonably be
expected to have a Material Adverse Effect.
9. No Material Proceedings
No action or administrative proceeding of or before any court,
arbitrator or agency (including, without limitation, investigative
proceedings) which could reasonably be expected to have a Material
Adverse Effect has been started or threatened against any member of
the Covenant Group or any of their respective assets.
148
10. Audited Financial Statements
Its most recent consolidated audited financial statements:
(a) were prepared in accordance with accounting principles
generally accepted in its jurisdiction of incorporation and
consistently applied;
(b) disclose all material liabilities (contingent or otherwise)
and all material unrealised or anticipated losses any member
of the Covenant Group; and
(c) save as disclosed therein, give a true and fair view of the
financial condition and operations of the Intermediate
Parent or, as the case may be, the UK Group during the
relevant financial year.
11. Original Financial Statements
Save as disclosed in the Disclosure Letter, the financial statements
of the Target (referred to in paragraph (c) of the definition of
Original Financial Statements), to the best of its knowledge and
belief:
(a) were prepared in accordance with accounting principles
generally accepted in England and Wales and consistently
applied;
(b) disclose all material liabilities (contingent or otherwise)
and all material unrealised or anticipated losses of the
Target and the CWC ConsumerCo Business; and
(c) save as disclosed therein, give a true and fair view of the
financial condition and operations of the Target and the CWC
ConsumerCo Business during the period to which such
financial statements relate.
12. No Material Adverse Change
Since the date as at which its most recent audited financial
statements (where required by Clause 16.1 (Annual Statements),
consolidated, in the case of the Borrower) were stated to be
prepared, there has been no change in its business or financial
condition or, in the business or financial condition of any member of
the UK Group or of the UK Group taken as a whole or, in the business
or financial condition of any member of the Target Group or of the
Target Group taken as a whole which, in each case, could reasonably
be expected to have a Material Adverse Effect.
13. Full Disclosure
It is not aware of any material facts or circumstances that have not
been disclosed to the Finance Parties originally party hereto and
which would, in its reasonable opinion, if disclosed, adversely
affect the decision of a person considering whether or not to provide
finance for the purposes set out in Clause 2.2 (Purpose) on the terms
of the Finance Documents.
14. Business Plan and Information Memorandum
The Borrower:
149
(a) does not regard any of the forecasts or projections set out
in the Business Plan as unreasonable or, to any material
extent, unattainable;
(b) considers (having made all reasonable enquiries) the
assumptions upon which the forecasts and projections
contained in the Business Plan are based to be fair and
reasonable in all material respects; and
(c) confirms that the factual information contained in the
Information Memorandum and any other written factual
information supplied by any member of the UK Group or any
member of the Target Group (in the latter case, supplied
after the Acquisition Date or, if supplied before the
Acquisition Date, supplied with the Borrower's knowledge) to
the Agent, the Arrangers and the Banks in connection
herewith is true, complete and accurate in all material
respects.
15. Budgets
It:
(a) regards (as at the date each Budget is delivered to the
Agent) as neither unreasonable, nor to any material extent
unattainable, any of the forecasts or projections set out in
the latest Budget delivered under Clause 16.5 (Budgets);
(b) believes (having made all reasonable enquiries) the
assumptions, upon which the forecasts and projections in
relation to the CWC ConsumerCo Business contained in the
latest Budget delivered under Clause 16.5 (Budgets) are
based, to be fair and reasonable; and
(c) has, to the best of its knowledge and belief (having made
all reasonable efforts to make due and careful enquiry),
made full disclosure of all material facts relating to the
CWC ConsumerCo Business to all the persons responsible for
the preparing of the latest Budget delivered under Clause
16.5 (Budgets).
16. Environmental Compliance
Each member of the Covenant Group has complied in all material
respects with all Environmental Law and obtained and maintained any
Environmental Permits breach of which or, as the case may be, failure
to obtain or maintain which, could reasonably be expected to have a
Material Adverse Effect.
17. Environmental Claims
No Environmental Claim has been commenced or (to the best of the
Borrower's knowledge and belief) is threatened against any member of
the Covenant Group where such claim would be reasonably likely, if
determined against such member of the Covenant Group to have a
Material Adverse Effect.
18. No Encumbrances
Save (in each case) for Permitted Encumbrances, no Encumbrance exists
over all or any of its present or future revenues or assets and, over
all or any of the present or future revenues or assets of any other
member of the Covenant Group.
150
19. No Loans
Save (in each case) for Permitted Loans and Guarantees, no member of
the Covenant Group has made any loans or granted any credit or other
financial accommodation which is or are outstanding.
20. Execution of this Agreement
Its execution of each Finance Document to which it is a party and the
performance of its obligations thereunder do not and will not:
(a) conflict with any agreement, mortgage, bond or other
instrument or treaty to which it is party or which is
binding upon it or any of its assets (including, without
limitation, the NTL CC Notes) in a manner that could
reasonably be expected to have a Material Adverse Effect;
(b) conflict with its constitutive documents and rules and
regulations; or
(c) conflict with any applicable law.
21. Ownership of the Parent
The Parent is a wholly-owned subsidiary of NTL Holdings, and no
persons or group of connected persons (as construed in accordance
with Clause 9.7 (Mandatory Prepayment due to Change in Control)) has
control (as construed in accordance with Clause 9.7 (Mandatory
Prepayment due to Change in Control)) of, NTL Holdings.
22. Licences and Consents
Each member of the Covenant Group has, at all relevant times,
obtained all material licences (including, without limitation, the
Licences), permissions, authorisations and consents (each an
"approval") required for the conduct of its business as carried on
from time to time, and all such approvals are valid and subsisting
save in any such case where failure to obtain such an approval or the
invalidity of such an approval or its failure to subsist could not
reasonably be expected to have a Material Adverse Effect and to the
best of its knowledge and belief there has been no act or omission on
the part of it, any Covenant Group member which is likely to give
rise to the enforcement, revocation, material amendment, suspension,
withdrawal or avoidance of any of the approvals or any of the
material terms or conditions thereof, which enforcement, revocation,
amendment, withdrawal, suspension or avoidance could reasonably be
expected to have a Material Adverse Effect.
23. Government or Regulatory Authority Inquiry
No member of the Covenant Group has to the best of its knowledge and
belief after due and careful inquiry received any notice or
communication which has not been disclosed to the Agent on or prior
to the Execution Date (as such term is defined in this Agreement)
from, or is aware of, any inquiry, investigation or proceeding on the
part of any government, court or regulatory agency or authority the
effect of which, in any such case, could reasonably be expected to
have a Material Adverse Effect.
151
24. Intellectual Property
It is not aware of any adverse circumstance relating to the validity,
subsistence or use of any member of the Covenant Group's Intellectual
Property which could reasonably be expected to have a Material
Adverse Effect.
25. Security Interest
(a) Subject (in each case) to the Reservations, each Security
Document creates the security interest which that Security
Document purports to create or, if that Security Document
purports to evidence a security interest, accurately
evidences a security interest which has been validly created
and each security interest ranks in priority as specified in
the Security Document creating or evidencing that interest.
(b) The shares of Intermediate Parent and the Borrower which are
subject to an Encumbrance under the Security Documents are
fully paid and not subject to any option to purchase or
similar rights and the constitutional documents of such
persons do not and could not restrict or inhibit (whether
absolutely, partly, under a discretionary power or
otherwise) any transfer of such shares pursuant to
enforcement of the Security Documents.
26. Group Structure
The corporate structure of the UK Group and the NTL Holding Group set
out in the Group Structure Chart delivered pursuant to Clause 2.4
(Conditions Precedent) and the corporate structure of the UK Group,
the Target Group and the NTL Holding Group set out in any Group
Structure Chart delivered to the Agent pursuant to Clause 18.29
(Revised Group Structure) is true, complete and accurate, in each
case as at the date of its delivery to the Agent.
27. Scheme Information
The CWC Circular contains all the material terms of the Scheme and
the information contained in the CWC Circular relating to the Group
(other than the Target Group) and the Scheme and, to the best of its
knowledge and belief, the CWC ConsumerCo Business is true, complete
and accurate in all material respects on its date of despatch. An
office copy of the order of the court sanctioning the Scheme under
Section 425 was filed with the Registrar of Companies for
registration pursuant to sub-section 3 of Section 425 on 12 May 2000.
28. The Scheme
In relation to the Scheme:
(a) no step has been taken which has increased (or may in the
future increase) the offer price under the Scheme beyond the
level specified in the CWC Circular;
(b) no modification, variation or amendment of a material nature
has been made to, and no waiver has been granted in respect
of, any of the conditions set out in Appendix 2 to the CWC
Circular or in the Transaction Agreement;
152
(c) no press release or other publicity, the text of which has
not previously been agreed with the Agent, which makes
reference to the Facility or to some or all of the Finance
Parties has been issued or allowed to be issued; and
(d) in all material respects relevant in the context of the
Scheme, it and each of its affiliates (as relevant) has
complied with the Code, the Financial Services Act 1986, the
Companies Act 1985 and all other applicable laws and
regulations.
29. Existing Group Indebtedness
(a) The Intermediate Parent owes no Financial Indebtedness to
any other members of the Group, other than the Parent.
(b) The Borrower owes no Financial Indebtedness to any members
of the Group, other than the Intermediate Parent.
- END OF SCHEDULE 3 -
153
1. DEFINITIONS AND INTERPRETATION...........................................1
2. THE FACILITY............................................................41
3. UTILISATION OF THE FACILITY.............................................42
4. PAYMENT AND CALCULATION OF INTEREST ON ADVANCES; INTEREST PERIODS.......42
5. MARKET DISRUPTION AND ALTERNATIVE INTEREST RATES........................44
6. NOTIFICATION............................................................45
7. REPAYMENT AND REDUCTION OF THE FACILITY.................................45
8. PREPAYMENT..............................................................45
9. MANDATORY PREPAYMENT....................................................46
10. TAXES...................................................................53
11. TAX RECEIPTS............................................................57
12. INCREASED COSTS.........................................................58
13. ILLEGALITY..............................................................59
14. MITIGATION..............................................................59
15. REPRESENTATIONS.........................................................60
16. FINANCIAL INFORMATION...................................................64
17. FINANCIAL CONDITION.....................................................72
18. COVENANTS...............................................................82
19. EVENTS OF DEFAULT.......................................................93
20. GUARANTEE AND INDEMNITY.................................................99
21. AGENCY FEES............................................................102
22. COSTS AND EXPENSES.....................................................102
23. DEFAULT INTEREST AND BREAK COSTS.......................................103
24. BORROWER'S INDEMNITIES.................................................104
25. CURRENCY OF ACCOUNT AND PAYMENT........................................105
26. PAYMENTS...............................................................105
27. SET-OFF................................................................107
28. SHARING................................................................107
29. THE AGENT, THE ARRANGERS AND THE BANKS.................................108
30. ASSIGNMENTS AND TRANSFERS..............................................114
31. CHANGE OF CURRENCY.....................................................117
32. CALCULATIONS AND EVIDENCE OF DEBT......................................118
33. REMEDIES AND WAIVERS, PARTIAL INVALIDITY...............................119
34. NOTICES................................................................119
35. COUNTERPARTS...........................................................123
36. AMENDMENTS.............................................................123
37. ACCESSION OF GUARANTORS................................................124
38. GOVERNING LAW..........................................................124
39. JURISDICTION...........................................................124
40. INTERCREDITOR AGREEMENT................................................125
SCHEDULE 1 The Banks........................................................126
SCHEDULE 2 Form of Transfer Certificate.....................................127
SCHEDULE 3 Existing Encumbrances............................................130
SCHEDULE 4 Form of Compliance Certificate...................................131
SCHEDULE 5 Mandatory Costs..................................................138
SCHEDULE 6 Form of Non-Bank Certificate.....................................141
SCHEDULE 7 Form of Guarantor Accession Memorandum...........................142
SCHEDULE 8 Additional Conditions Precedent..................................144
SCHEDULE 9 Historic Representations.........................................145
APPENDIX A
Change of Control and Asset Disposition Provisions of the Exit Financing
Indenture