EXHIBIT 10.19
CONFORMED COPY
2001 DEBENTURE
DATED 15 NOVEMBER 2001
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THE COMPANIES NAMED
HEREIN AS THE
CHARGING COMPANIES (1)
- and -
THE GOVERNOR AND COMPANY OF THE BANK OF SCOTLAND (2)
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COMPOSITE GUARANTEE
AND DEBENTURE
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CONTENTS
1. INTERPRETATION........................................................................................1
2. GUARANTEE PROVISIONS..................................................................................3
3. COVENANT TO PAY.......................................................................................4
4. FIXED AND FLOATING CHARGES............................................................................4
5. CHARGES ON NON CHARGING SUB SHARES BY THE CHARGING COMPANIES..........................................7
6. CRYSTALLISATION OF FLOATING CHARGE....................................................................9
7. NEGATIVE PLEDGE AND FURTHER SECURITY.................................................................10
8. REPRESENTATIONS AND WARRANTIES.......................................................................11
9. COVENANTS OF THE CHARGING COMPANIES..................................................................11
10. RECEIVABLES..........................................................................................15
11. THE SECURITY TRUSTEE'S POWERS OF SALE AND LEASING....................................................16
12. CONSOLIDATION OF SECURITIES..........................................................................17
13. APPOINTMENT AND POWERS OF RECEIVER...................................................................17
14. POWER OF ATTORNEY....................................................................................19
15. PROTECTION OF THIRD PARTIES..........................................................................20
16. NEW ACCOUNTS.........................................................................................20
17. RIGHTS AS BETWEEN EACH CHARGING COMPANY, THE OTHER CHARGING COMPANIES AND THE SECURITY
TRUSTEE (ON BEHALF OF THE SECURITY BENEFICIARIES)....................................................21
18. CONSOLIDATION OF ACCOUNTS AND SET-OFF................................................................23
19. CURRENCY.............................................................................................24
20. SUSPENSE ACCOUNT.....................................................................................24
21. TIME AND INDULGENCES.................................................................................24
22. REMEDIES, WAIVERS, AMENDMENTS AND CONSENTS...........................................................25
23. EXPENSES.............................................................................................25
24. PROVISIONS SEVERABLE.................................................................................25
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25. AVOIDANCE OF PAYMENTS................................................................................26
26. DISCRETIONS..........................................................................................26
27. ASSIGNMENT...........................................................................................26
28. INTERCREDITOR AGREEMENT AND FACILITIES AGREEMENT TO PREVAIL..........................................27
29. NOTICES..............................................................................................27
30. LAW AND JURISDICTION.................................................................................27
31. MEMORANDUM AND ARTICLES..............................................................................27
FIRST SCHEDULE...............................................................................................28
The Charging Companies...................................................................................28
THE SECOND SCHEDULE..........................................................................................29
Part I...................................................................................................29
Details of Registered Land...............................................................................29
Part II..................................................................................................29
Details of Unregistered Land.............................................................................29
THE THIRD SCHEDULE...........................................................................................30
The Guarantee............................................................................................30
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THIS COMPOSITE GUARANTEE AND DEBENTURE is made 15 November 2001
BETWEEN:
(1) THE COMPANIES LISTED IN THE FIRST SCHEDULE TO THIS DEED (the "Charging
Companies").
(2) THE GOVERNOR AND COMPANY OF THE BANK OF SCOTLAND, Bank House, 8 Cherry
Street, Birmingham B2 5AD (as security trustee for the Security
Beneficiaries as defined herein (the "Security Trustee").
WHEREAS:
(A) One or more of the Charging Companies has already been granted, or may
hereafter be granted facilities from time to time by the Security
Beneficiaries (or any of them) (as herein defined) and/or is now or may
hereafter become indebted to the Security Beneficiaries
(B) The Charging Companies have agreed to execute this Deed in order to secure
all monies now owing or which may hereafter become owing from the Charging
Companies (or any of them) to the Security Beneficiaries (or any of them)
(C) It has been agreed between the Charging Companies and the Security
Beneficiaries that the security constituted hereby will be held by the
Security Trustee and given to the Security Trustee for the benefit of the
Security Beneficiaries
THIS DEED WITNESSES:
1 INTERPRETATION
In this Deed, except so far as the context otherwise requires:-
1.1 Except as otherwise specified herein, all terms defined in the
Facilities Agreement or the Intercreditor Agreement shall have the
same meaning when used herein.
1.2 The following terms shall have ascribed to them the following
meanings:-
the "Act" means the Law of Property Act 1925;
"Charged Property" means the property referred to in Clauses 3 or 4
and all other property of whatsoever nature from time to time charged
by or pursuant to this Deed;
"this Deed" means this Deed as from time to time amended and any
document made pursuant or supplemental hereto;
the "Facilities Agreement" means the facilities agreement dated 27 May
1999 between DDI Europe Limited (formerly called MCM Electronics
Limited) (1) and The Governor and Company of the Bank of Scotland (in
its various capacities) (2) - (6);
"Group" means Newco and its Subsidiaries from time to time and "Group
Company" means any of them and "Group Companies" means all of them;
the "Guarantee" means the Guarantee contained in Clause 2 as extended
by the Third Schedule hereto;
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"Intellectual Property" means copyrights, patents and registered and
unregistered designs (including applications and rights to apply
therefor), inventions, trademarks and service marks whether registered
or not (including all registrations thereof and applications and
rights to apply therefor), confidential information and know-how and
fees, royalties and other rights of every kind deriving from
copyright, patents or inventions or other intellectual property
throughout the World now or at any time hereafter belonging to or
created by or assigned to a Charging Company;
"Newco" means DDI Europe Limited (company registration number
3731403);
"Non Charging Sub Shares" means the issued shares in the capital of
DDI Interconnect Limited, HBH Group Limited, Osborne Precision
Sheetmetal Limited and DDI Electronics Limited;
"Planning Acts" means the Town & Country Planning Acts 1990 and the
Planning (Listed Buildings and Conservation Areas) Act 1990;
"Receivables" means all present and future book debts, rentals,
royalties, fees, amounts receivable under Hedging Arrangements, VAT
and all other amounts recoverable or receivable by any Charging
Company from other persons due or owing to such Charging Company and
the benefit of all rights relating thereto including, without
limitation, negotiable instruments, legal and equitable charges,
reservations of property rights, rights of tracing and unpaid vendor's
liens and similar associated rights
"Receiver" means any receiver or receiver and manager or
administrative receiver appointed by the Security Trustee under or by
virtue of this Deed whether alone or jointly with any other person and
includes any substitute for any of them appointed from time to time;
"Related Rights" means, in relation to the Non Charging Sub Shares,
all dividends and interest paid or payable in relation thereto and all
stocks, shares, securities (and the dividends or interest thereon),
rights, moneys or property accruing or offered at any time in relation
to such shares or other securities by way of redemption, substitution,
exchange, bonus or preference, pursuant to option rights or otherwise
in respect of any of the Non Charging Sub Shares or in substitution or
exchange for any of the Non Charging Sub Shares;
"Secured Obligations" means all indebtedness, liabilities and
obligations which are now or may at any time hereafter be due, owing
or incurred in any manner whatsoever to the Security Beneficiaries by
any Group Company whether actually or contingently, whether pursuant
to the Guarantee or otherwise, whether solely or jointly with any
other person, whether as principal or surety and whether or not the
Security Beneficiaries shall have been an original party to the
relevant transaction and in whatever currency denominated including
all liabilities from time to time assumed or incurred by the Security
Beneficiaries at the request of any Group Company in connection with
foreign exchange transactions, acceptances, discounting or otherwise
or under guarantees, bonds, indemnities, documentary or other credits
or any instruments whatsoever and including interest, discount,
commission and other lawful charges or reasonable expenses which the
Security Beneficiaries may in the course of their business charge in
respect of any facilities or accommodation or service provided by the
Security Beneficiaries for keeping any Group Company's account;
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1.3 Section 61 of the Act (other than the definition of "month" contained
therein) shall govern the construction hereof.
1.4 References to the Agent, Security Trustee, the Security Beneficiaries,
the Banks, the Working Capital Bank, and the Hedging Counterparty
shall include their respective successors and permitted assigns.
1.5 A reference to a Clause, sub-Clause, or Schedule shall mean and refer
to a Clause, sub-Clause, or Schedule of this Deed.
1.6 Any reference in this Deed to any statute or to any provisions of any
statute shall be construed as including a reference to any statutory
modification or re-enactment thereof and to any regulations or orders
made thereunder or deriving validity therefrom and from time to time
in force.
1.7 Headings are inserted for convenience only and shall be ignored in
construing this Deed.
1.8 References in this Deed to this Deed or any document include
references to this Deed or such other document as varied supplemented
novated and/or replaced in any manner from time to time.
1.9 The terms of the other Banking Documents and of any side letters
between the parties thereto in relation to any Banking Documents are
incorporated in this Deed to the extent required to ensure that any
disposition of the Charged Property contained in this Deed is a valid
disposition in accordance with Section 2(1) of the Law of Property
(Miscellaneous Provisions) Act 1989.
1.10 If the Security Trustee reasonably considers that an amount paid by
any Charging Company or any person to the Security Trustee under any
agreement in respect of the Secured Obligations is likely to be
avoided or otherwise set aside on the liquidation or administration of
any Charging Company or any other person then that amount shall not be
considered to have been irrevocably paid for the purposes of this
Deed.
1.11 A reference in this Deed to any assets includes present and future
assets.
1.12 A reference in this Deed to a charge or mortgage of any freehold or
leasehold property includes all buildings and all the chargor's
fixtures and fittings (including trade fixtures and fittings) and
fixed plant and machinery from time to time on the Charged Property.
2. GUARANTEE PROVISIONS
2.1 Each Charging Company hereby irrevocably and unconditionally
guarantees to the Security Trustee (on behalf of each of the Security
Beneficiaries) to pay to the Security Trustee on behalf of the
Security Beneficiaries on demand the Secured Obligations (except any
Secured Obligations in respect of which the relevant Charging Company
is already primarily liable).
2.2 The Guarantee is given subject to and with the benefit of the
provisions set out in the Third Schedule.
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3 COVENANT TO PAY
3.1 Each of the Charging Companies hereby covenants with the Security
Trustee that as and when the Secured Obligations or any part thereof
are due for payment or on such earlier date as this security becomes
enforceable and the Security Trustee determines to enforce the same it
shall on demand in writing by the Security Trustee pay the Secured
Obligations (or as the case may be the part of the Secured Obligations
then due to be paid and remaining unpaid) to the Security Trustee for
its own account, or for the account of the Security Beneficiaries.
3.2 Each Charging Company hereby covenants that it shall on demand pay to
the Security Trustee all costs and expenses incurred by the Security
Trustee in relation to the protection and enforcement of the Security
Trustee's rights hereunder.
3.3 The Security Trustee shall hold the benefit of the guarantees and
covenants in Clauses 2, 3.1 and 3.2 of this Deed (and any other
covenant expressed to be made in favour of it in this document) and
all security hereunder, and all its rights and claims under this Deed
and such security as shall be vested in it, as security trustee for
the Security Beneficiaries, as is hereby acknowledged by each of the
parties to this Deed.
4. FIXED AND FLOATING CHARGES
With full title guarantee and as a continuing security for the payment or
discharge of all the Secured Obligations and all their other obligations
under this Deed:-
4.1 each Charging Company hereby charges to the Security Trustee (for the
benefit of the Security Beneficiaries) by way of first legal
mortgage:-
4.1.1 all its freehold and leasehold interest in the properties title
to which is registered at HM Land Registry described in Part I of
the Second Schedule together with all buildings, fixtures
(excluding in the case of leasehold property landlord's fixtures
but including other trade fixtures and excluding in the case of
freehold property and leasehold property which is let or sub-let
to a third party, tenant's and trade fixtures and fittings of
such third party) and its fixed plant and machinery at any time
thereon;
4.1.2 all other freehold and leasehold interests in the properties now
vested in it but title to which is not registered at HM Land
Registry described in Part II of the Second Schedule together
with all buildings, fixtures (excluding in the case of leasehold
property landlord's fixtures but including other trade fixtures
and excluding in the case of freehold property and leasehold
property which is let or sub-let to a third party, tenant's and
trade fixtures and fittings of such third party) and its fixed
plant and machinery at any time thereon;
4.2 each Charging Company charges to the Security Trustee (for the benefit
of the Security Beneficiaries) by way of first fixed charge:-
4.2.1 all present and future freehold and leasehold property of such
Charging Company not otherwise charged by way of legal charge
pursuant to Clauses 4.1.1 or 4.1.2 together with all buildings,
fixtures (excluding in the case of leasehold property landlord's
fixtures but including trade fixtures and excluding in the case
of freehold property and leasehold property which is let
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or sub-let to a third party, tenant's and trade fixtures and
fittings of such third party) and its fixed plant and machinery
at any time thereon;
4.2.2 all estates and interests not hereinbefore effectively charged
now or hereafter belonging to such Charging Company in or over
land wheresoever situate or the proceeds of sale of land and all
licences now or hereafter held by such Charging Company to enter
upon or use land and the benefit of all other agreements relating
to land to which such Charging Company is or may become a party
or otherwise entitled and all trade and tenants' fixtures, plant
and machinery owned by such Charging Company now or hereafter
annexed to all freehold and leasehold property its estate or
interest in which stands charged hereunder;
4.2.3 all stocks, shares (including but not limited to shares in any
subsidiary), debentures, loan capital, right to subscribe for,
convert other securities into or otherwise acquire any stocks,
shares, debentures or loan capital of any other body corporate
now or at any time hereafter belonging to such Charging Company,
together with all dividends (unless such dividends are or are to
be paid in satisfaction of any of the Secured Obligations),
interest and other income and all other rights of whatsoever kind
deriving from or incidental to any of the foregoing;
4.2.4 the goodwill of such Charging Company and its uncalled capital
now or at any time hereafter in existence and future calls
(whether made by the directors of the Charging Company or by a
Receiver or a liquidator);
4.2.5 all Intellectual Property;
4.2.6 all plant, vehicles and machinery now or at any time hereafter
belonging to such Charging Company (excluding however plant and
machinery for the time being forming part of its stock in trade
or work in progress);
4.2.7 all chattels now or at any time hereafter hired, leased or
rented by such Charging Company to any other person together in
each case subject to and with the benefit of the related hiring,
leasing or rental contract and any guarantee, indemnity or other
security for the performance of the obligations of any person
under or in respect of such contract;
4.2.8 all Receivables;
4.2.9 the benefit of all contracts licences consents and
authorisations (statutory or otherwise) (the "Contracts") held in
connection with its business or the use of any Charged Property
specified in any other paragraph or sub-paragraph of this Clause
4 and the right to recover and receive all compensation which may
be payable to it in respect of them.
4.3 Each Charging Company hereby charges to the Security Trustee (for the
benefit of the Security Beneficiaries) by way of first floating charge
all its undertaking and all its property and assets whatsoever and
wheresoever situated both present and future, including (without
prejudice to the generality of the foregoing) (i) heritable property
and all other property and assets in Scotland and (ii) the proceeds of
the collection of any Receivables, but excluding any property or
assets from time to time or for the time being effectively charged by
way of fixed charge under or pursuant to this Deed.
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4.4 The security from time to time constituted by or pursuant to this Deed
shall:-
4.4.1 be in addition to and shall be independent of every bill, note,
guarantee, mortgage or other security which the Security
Beneficiaries may at any time hold for any of the Secured
Obligations and it is hereby declared that no prior security held
by the Security Trustee and/or the Security Beneficiaries over
the Charged Property or any part thereof shall merge into the
security created hereby or pursuant hereto; and
4.4.2 remain in full force and effect as a continuing security until
the earlier of (i) the Security Trustee having certified in
writing that the Secured Obligations have been discharged in full
and (ii) the security constituted by this Deed having been
released.
4.5 Leasehold Interests Containing Prohibition on Charging
4.5.1 Until the relevant consent shall have been obtained, there shall
be excluded from the charge created by Clause 4.1 above (and
further assurance provisions as set out in Clause 7.2 below) any
leasehold property held by any Charging Company under a lease the
terms of which either preclude absolutely the relevant Charging
Company from creating any charge over its leasehold interest in
such property or require the consent of any third party prior to
the creation of such charge and such consent shall not have been
previously obtained (each an "Excluded Property");
4.5.2 With regard to each Excluded Property, the relevant Charging
Company hereby undertakes to make application for the consent of
the relevant third party to the creation of the charge contained
in Clause 4.1 above (or Clause 7.2 below) within twenty eight
days of the date hereof and to use all its reasonable endeavours
to obtain such consent as soon as possible and to keep the
Security Trustee informed of the progress of its negotiations
with such third parties;
4.5.3 Forthwith, upon receipt of the relevant third party's consent as
aforesaid, the relevant Excluded Property shall thereupon be
charged to the Security Trustee pursuant to the terms of Clause
4.1 above (or Clause 7.2 below, as the case may be). If required
by the Security Trustee in respect of any Excluded Property at
any time following receipt of such consent or if earlier, the
date falling sixty days after the date hereof, the relevant
Charging Company will execute a valid legal mortgage in such form
as the Security Trustee shall require.
4.6 Intellectual Property Interests Containing Prohibition on Charging
4.6.1 Until the relevant consent shall have been obtained, there shall
be excluded from the charge created by Clause 4.1 above (and
further assurance provisions as set out in Clause 7.2 below) any
Intellectual Property in which any Charging Company has an
interest pursuant to any licence or other agreement the terms of
which either preclude in any way the Charging Company from
assigning or creating any charge over its interest in such
Intellectual Property or require the consent of any third party
prior to the making of such assignment or creation of such charge
and such consent shall not have been previously obtained (each an
"Excluded Intellectual Property Right");
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4.6.2 With regard to each Excluded Intellectual Property Right, the
relevant Charging Company hereby undertakes to make application
for the consent of the relevant third party (where the identity
of the relevant third party is known to the relevant Charging
Company) to the creation of the charge contained in Clause 4.1
above (or Clause 7.2 below) within twenty eight days of the date
hereof and to use its reasonable endeavours to obtain such
consent as soon as possible and to keep the Security Trustee
informed of the progress of its negotiations with such third
parties;
4.6.3 Forthwith, upon receipt of the relevant third party's consent as
aforesaid, the relevant Excluded Intellectual Property Right
shall thereupon be charged to the Security Trustee pursuant to
the terms of Clause 4.1 above (or Clause 7.2 below, as the case
may be). If required by the Security Trustee in respect of any
Excluded Intellectual Property Right at any time following
receipt of such consent or if earlier, the date falling sixty
days after the date hereof, the relevant Charging Company will
execute a valid equitable charge or legal assignment in such form
as the Security Trustee shall require.
4.7 Interests in Contracts Containing Prohibition on Charging
4.7.1 Until the relevant consent shall have been obtained, there shall
be excluded from the charge created by Clause 4.1 above (and
further assurance provisions as set out in Clause 7.2 below) any
Contract in which any Charging Company has an interest pursuant
to any licence or other agreement the terms of which either
preclude in any way the Charging Company from assigning or
creating any charge over its interest in such Contract or require
the consent of any third party prior to the making of such
assignment or the creation of such charge and such consent shall
not have been previously obtained (each an "Excluded Contract
Right");
4.7.2 With regard to each Excluded Contract Right, the relevant
Charging Company hereby undertakes to make application for the
consent of the relevant third party (where the identity of the
relevant third party is known to the relevant Charging Company)
to the creation of the charge contained in Clause 4.1 above (or
Clause 7.2 below) within twenty eight days of the date hereof and
to use its reasonable endeavours to obtain such consent as soon
as possible and to keep the Security Trustee informed of the
progress of its negotiations with such third parties;
4.7.3 Forthwith, upon receipt of the relevant third party's consent as
aforesaid, the relevant Excluded Contract Right shall thereupon
be charged to the Security Trustee pursuant to the terms of
Clause 4.1 above (or Clause 7.2 below, as the case may be). If
required by the Security Trustee in respect of any Excluded
Contract Right at any time following receipt of such consent the
relevant Charging Company will execute a valid equitable charge
or legal assignment in such form as the Security Trustee shall
require.
5. CHARGES ON NON CHARGING SUB SHARES BY THE CHARGING COMPANIES
5.1 Each Charging Company, as sole beneficial owner hereby as continuing
security for the payment, discharge and performance of all the Secured
Obligations:-
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5.1.1 mortgages and charges and agrees to mortgage and charge to the
Security Trustee all Non Charging Sub Shares held now or in the
future by it and/or any nominee on its behalf, the same to be a
security by way of a first mortgage or charge; and
5.1.2 mortgages and charges and agrees to mortgage and charge to the
Security Trustee all the Related Rights accruing to all or any of
the Non Charging Sub Shares held now or in the future by it
and/or any nominee on its behalf, the same to be a security by
way of a first mortgage or charge; and
5.1.3 undertakes to comply with its obligations under Clause 5.2
hereof.
5.2 Each Charging Company shall by way of security for the Secured
Obligations:-
5.2.1 immediately deposit by way of security with the Security Trustee
all bearer instruments and certificates or other documents
evidencing an entitlement to the Non Charging Sub Shares and
share transfer forms in blank in respect of those Shares as are
in certificated form and the Security Trustee will hold the same
by way of security on the terms set out in this Deed;
5.2.2 immediately on receipt of any certificate or other document
evidencing any entitlement to any further or other Non Charging
Sub Shares deposit it with the Security Trustee together with
such share transfer forms in blank which the Security Trustee
will hold by way of security on the terms set out in this Deed.
5.3 Each Charging Company authorises the Security Trustee:-
5.3.1 to arrange for any of the Non Charging Sub Shares which are in
registered form to be registered in the name of the Security
Trustee or a nominee of the Security Trustee (if required by the
Security Trustee to perfect the Security Trustee's security); and
5.3.2 at any time after the security hereby constituted has become
enforceable to transfer or cause any of the Non Charging Sub
Shares to be transferred to and registered in the name of any
purchase or transferee.
5.4 Each Charging Company shall from time to time on the request of the
Security Trustee execute and sign all transfers, powers of attorney
and other documents and give such instructions and directions as the
Security Trustee may require for perfecting its title to any of the
Non Charging Sub Shares or for vesting the same in itself in order to
perfect the security constituted hereby or its nominee or, in the
exercise of its powers or realisation, in any purchaser or transferee.
5.5 Unless and until the security constituted hereby becomes enforceable,
and, while it remains so, each Charging Company shall be entitled:-
5.5.1 to receive all dividends, interest and income from the Non
Charging Sub Shares and, if necessary, the Security Trustee
shall, and shall cause its nominee to release or account for the
same to the relevant Charging Company; and
5.5.2 to exercise all the voting rights and other rights and powers
attached or incidental to the Non Charging Sub Shares, and if
necessary for this purpose,
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the Security Trustee shall and shall cause its nominees either to
exercise such voting and other rights and powers attached to or
incidental to the Non Charging Sub Shares from time to time in
accordance with the directions of the relevant Charging Company
or to appoint the relevant Charging Company or any person
nominated by it to be the proxy of the Security Trustee or its
nominees to exercise such voting and other rights and powers
attached to or incidental to the Non Charging Sub Shares in
accordance with the directions of the relevant Charging Company
PROVIDED HOWEVER THAT the relevant Charging Company shall not,
without the previous consent in writing of the Security Trustee,
exercise or require the Security Trustee or its nominees or any
such proxy to exercise the voting rights attached to any of the
Non Charging Sub Shares in favour of resolutions having any of
the following effects, namely:-
5.5.2.1 any change in the terms of the Non Charging Sub Shares
concerned; or
5.5.2.2 any other matter which, in the opinion of the Security
Trustee, would be contrary to the provisions of the Banking
Documents.
In the event of any meeting of the holders of any of the Non Charging Sub
Shares being called for the purpose of passing a resolution relating to any
such matters referred to above the Security Trustee shall vote or procure
its nominees or proxies to vote in respect of the Non Charging Sub Shares
registered in their name or under their control in such manner as they
shall in their entire discretion consider to be in the interests of the
security constituted hereby.
5.6 Any time after the security becomes enforceable, and while it remains
so, and without any further consent or authority on the part of the
relevant Charging Company, the Security Trustee may exercise at its
discretion (in the name of the relevant Charging Company or otherwise)
in respect of any of the Non Charging Sub Shares any voting rights and
any powers or rights which may be exercised by the person or persons
in whose name or names the Non Charging Sub Shares are registered or
who is the holder or bearer of them including (but without limitation)
all the powers given to trustees by section 10(3) and (4) of the
Trustee Act 1925 (as amended by section 9 of the Trustee Investment
Act 1961) in respect of securities or property subject to a trust.
6. CRYSTALLISATION OF FLOATING CHARGE
6.1 The Security Trustee may by notice in writing to a Charging Company
convert the floating charge created pursuant to Clause 4.3 into a
fixed charge as regards all or any of that Charging Company's assets
charged under Clause 4.3 and specified in the notice if:-
6.1.1 an Event of Default occurs which remains unremedied or unwaived;
or
6.1.2 the Security Trustee in its absolute discretion considers those
assets to be in danger of being seized, or sold under any form of
distress, attachment, execution or other legal process.
6.2 The floating charge created by a Charging Company under this Deed
shall (in addition to the circumstances in which the same will occur
under general law)
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automatically be converted into a fixed charge in relation to the
assets of that Charging Company:-
6.2.1 on the convening of any meeting of the members of that Charging
Company to consider a resolution to wind up that Charging
Company; or
6.2.2 on the presentation of a petition (other than a petition
determined by the Security Trustee to be frivolous or vexatious)
to wind up that Charging Company which is not discharged within
fourteen days; or
6.2.3 on the appointment of an administrator to that Charging Company;
or
6.2.4 if that Charging Company fails to comply with its obligations
under Clause 7 of this Deed PROVIDED ALWAYS that in such
circumstances the floating charge shall be converted into a fixed
charge in respect only of the assets of such Charging Company
which have been encumbered or that have been otherwise sold,
discounted, factored, transferred, leased, lent or otherwise
disposed of.
6.3 Service by the Security Trustee of a notice pursuant to Clause 6.1
above in relation to any class of assets of any Charging Company shall
not be construed as a waiver or abandonment of the Security Trustee's
rights to serve similar notices in respect of any other class of
assets or of any other of the rights of the Security Trustee and/or
the Security Beneficiaries hereunder.
7. NEGATIVE PLEDGE AND FURTHER SECURITY
7.1 Each Charging Company severally covenants with the Security Trustee
(for the benefit of the Security Beneficiaries) that during the
continuance of this security it shall not without the consent in
writing of the Security Trustee:-
7.1.1 create, extend or permit to subsist any Security Interest (other
than a Permitted Security Interest) upon any of the Charged
Property to secure any liability, actual or contingent;
7.1.2 save as permitted or required under this Deed or under the
Facilities Agreement, sell, discount, factor, transfer, lease,
lend or otherwise dispose of, whether by means of one or a number
of transactions related or not and whether at one time or over a
period of time, the whole or, save in the normal course of
trading, any part of the Charged Property.
7.2 Without prejudice to the generality of the covenant for further
assurance deemed to be included herein by virtue of Section 76(1)(c)
of the Act, each Charging Company shall from time to time whensoever
requested by the Security Trustee and at such Charging Company's cost,
execute in favour of the Security Trustee, or as the Security Trustee
may reasonably direct, such further or other legal assignments,
transfers, mortgages, legal or other charges or securities as in each
case it may be lawful for such Charging Company to execute and are not
inconsistent with the provisions of this Deed or the Facilities
Agreement and the Security Trustee shall reasonably stipulate over the
Charged Property for the purpose of more effectively providing the
security stipulated herein for the payment or discharge of the Secured
Obligations. Without prejudice to the generality of the foregoing,
such assignments, transfers, mortgages, legal or other charges or
securities shall be in such form as the Security Trustee may
reasonably require and may contain provisions such as are
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10
herein contained and provisions to the like effect to the extent it is
legally able to do so and/or such other provisions of whatsoever kind
as the Security Trustee shall reasonably consider requisite for the
perfection of the security constituted by or pursuant to this Deed.
8. REPRESENTATIONS AND WARRANTIES
Each Charging Company hereby represents and warrants to the Security
Trustee (for the benefit of the Security Beneficiaries) in respect of
itself as follows:-
8.1 no liquidator, Receiver, administrator or similar appointee has been
appointed in respect of the Charging Company or any part of any of its
assets and no action is currently being taken with a view to
appointing any such liquidator, Receiver, administrator or similar
appointee;
8.2 neither the entry nor the performance of or compliance with its
obligations under or pursuant to this Deed nor the creation of the
security created by it pursuant to this Deed does or will violate in
any material manner, or exceed any borrowing or other powers or
restrictions granted or imposed under or pursuant to:-
8.2.1 any law to which the Charging Company is subject; or
8.2.2 the Charging Company's Memorandum or Articles of Association; or
8.2.3 any other agreement, arrangement or understanding to which the
Charging Company is a party or otherwise subject;
8.3 each of the representations and warranties in sub-clauses 8.1 to 8.2
above will be correct and complied with in all material respects at
all times during the continuance of this security.
9. COVENANTS OF THE CHARGING COMPANIES
Each of the Charging Companies hereby covenants that, during the
continuance of this security:-
9.1
9.1.1 it shall maintain insurances on and in relation to its business
and assets including, without limitation, employers liability
insurance and product liability insurance third party liability
insurance and cause all buildings trade and other fixtures
forming part of the Charged Property to be insured with reputable
underwriters or insurers against such risks and to such extent as
is usual for companies carrying on a business such as that
carried on by the Charging Company whose practice is not to self
insure (or, in relation to any leasehold property in respect of
which the insurance requirements are specified to be subject to
the approval of the relevant landlord, use all reasonable
endeavours to procure the same). If so required by the Security
Trustee such insurances shall be effected in the joint names of
the Charging Company and the Security Trustee or, at the option
of the Security Trustee, with the interest of the Security
Trustee noted on the policies of insurance and with the policies
containing such provisions for the protection of the Security
Trustee (for the benefit of the Security Beneficiaries) as the
Security Trustee may require. The Charging Company shall from
time to time upon written request supply the Security Trustee
with copies of all such insurance
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11
policies or certificates of insurance in respect thereof or such
other evidence of the existence of such policies as may be
acceptable to the Security Trustee and any premium receipts in
respect of such policies;
9.1.2 without limiting the generality of the preceding sub-clause if
so required by the Security Trustee, use all reasonable
endeavours to cause the policies of insurance maintained by it
pursuant to paragraph 9.1.1 above to be as soon as reasonably
practicable amended to include clauses reasonably satisfactory to
the Security Trustee to ensure that no breach of any of the terms
of any such policy of insurance nor failure to give notice of any
event giving rise to any claim by any Charging Company will
invalidate such policy of insurance or any provision thereof as
regards the Security Trustee and/or the Security Beneficiaries
and to ensure that the relevant insurer shall advise the Security
Trustee:-
9.1.2.1 of any cancellation alteration termination or expiry of
any such policy at least 30 days before such cancellation
alteration termination or expiry is due to take effect;
9.1.2.2 of any default in the payment of any premium or failure
to renew the insurance at least 30 days before the renewal
date; and
9.1.2.3 of any act or omission or the occurrence of any event of
which the insurer has knowledge and which might invalidate
or render unenforceable (in whole or in part) the insurance;
9.1.3 it will duly and punctually pay all premiums and other monies
necessary for effecting and keeping in force such insurances and
shall renew all insurance at least 14 days before the relevant
policies or contracts expire and shall promptly confirm in
writing to the Security Trustee when each such renewal is
effected;
9.1.4 it shall not do or suffer or cause to be done or suffered
anything whereby any insurance policy now or at any time effected
upon the Charged Property may become liable to be vitiated or
cancelled and in particular shall not use or allow the Charged
Property to be used otherwise than in accordance with the terms
of any policy of insurance for the time being relating thereto
(including any warranties or trading limits therein) without
first giving written notice to the Security Trustee and obtaining
the consent of the insurers concerned and complying with such
requirements as to the payment of extra premiums or otherwise as
the insurers may impose;
9.1.5 if default shall at any time be made by any Charging Company in
effecting or keeping up the insurances referred to in sub-clause
9.1.1 or in producing any such policy or receipt to the Security
Trustee on demand, the Security Trustee may take out or renew
such insurances in any sum which the Security Trustee may think
expedient and all monies expended by the Security Trustee under
this provision shall be deemed to be properly paid by the
Security Trustee, and shall be reimbursed by the Charging Company
on demand and shall bear interest at the highest rate for the
time being in effect under the Facilities Agreement from the date
of payment until the date of reimbursement. This Deed shall be a
security for the reimbursement to the Security Trustee of such
monies together with such interest as aforesaid;
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12
9.1.6 all claims and monies received or receivable under any such
insurances of freehold and leasehold properties shall (subject to
the rights of any claims of any lessor or landlord of any part of
the Charged Property) be applied by the Charging Company, in
repairing, replacing, restoring or rebuilding the property
damaged or destroyed (or shall be otherwise applied subject to
the consent of the Security Trustee) or, if so directed by the
Security Trustee after the occurrence only of an Event of
Default, held by the Charging Company in trust for the Security
Trustee;
9.2 it shall keep all buildings forming part of the Charged Property and
in which trading operations are carried on, and all plant, machinery,
fixtures, fittings and other effects in or upon the same and every
part thereof required for the use of the Charging Company in a state
of repair working order and condition that is no worse than the state
of repair, working order and condition as at the date of this
Debenture and shall keep all other buildings in a good state of repair
working order and condition, and shall comply with all covenants and
notices in relation thereto to be performed by the Charging Company
and contained in any lease of such buildings and permit the Security
Trustee, its officers, employees and agents free access at all
reasonable times and on the giving of reasonable notice to view the
state and condition of the foregoing without becoming liable as
mortgagees in possession;
9.3 it shall duly and punctually pay all rates, rents, taxes, and other
outgoings due by it in respect of the Charged Property or any of it;
9.4 it shall permit the Security Trustee or its designated representatives
on reasonable notice to have access during normal office hours to its
accounts and accounting records and to any books and records relating
to the Charged Property, to inspect and take extracts from the same
and make photocopies thereof and the Charging Company shall provide,
at its cost and expense, such clerical and other assistance as the
Security Trustee may reasonably request with regard thereto;
9.5 it shall in relation to the Charged Property comply with all material
obligations under any present or future statute, regulation, order and
instrument or under any bye-laws, regulations or requirements of any
competent authority or other approvals, licences or consents and if
requested by the Security Trustee produce to the Security Trustee
within 14 days of receipt every material notice, order or proposal
given or made in relation to the Charged Property by any competent
authority and either comply with the same or make such objections and
representations against the same as the Security Trustee may
reasonably require or approve (such approval not to be unreasonably
withheld or delayed);
9.6 it shall observe and perform all covenants and stipulations from time
to time affecting any part of the Charged Property or the manner of
use or the enjoyment of the same and shall not without the prior
written consent of the Security Trustee enter into any onerous or
restrictive obligations affecting any part thereof;
9.7 it shall not without the prior written consent of the Security Trustee
such consent not to be unreasonably withheld or delayed confer on any
person any right or licence to occupy any land or buildings forming
part of the Charged Property or any licence to assign or sub-let any
part of the Charged Property;
9.8 it shall not carry out any development within the meaning of the
Planning Acts in or upon the Charged Property or any part thereof
without first obtaining such permissions as may be required under or
by virtue of the Planning Acts, and in the
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13
case of development involving a substantial change in the structure or
a change of use of the Charged Property or any part thereof, without
first obtaining the written consent of the Security Trustee;
9.9 it shall upon request by the Security Trustee deposit with the
Security Trustee and the Security Trustee during the continuance of
this security shall be entitled to hold all deeds and documents of
title relating to the Charging Company's title to the freehold and
leasehold and heritable property (and all insurance policies relating
thereto to which the Charging Company is entitled to possession) and
other Charged Property and all stocks, shares and other securities and
all policies of insurance hereby charged for the time being;
9.10 it shall preserve, maintain and renew as and when necessary all
Intellectual Property required in connection with its business and/or
the premises in which such business is conducted;
9.11 it shall indemnify the Security Trustee (for the benefit of the
Security Beneficiaries) (and as a separate covenant any Receiver
appointed by them) against all existing and future rents, taxes,
duties, fees, renewal fees, charges, assessments, impositions and
outgoings whatsoever (whether imposed by deed or statute or otherwise
and whether the nature of capital or revenue and even though of a
wholly novel character) which now or at any time during the
continuance of the security constituted by or pursuant to this Deed
are payable in respect of the Charged Property or any part thereof or
by the owner or occupier thereof; if any such sums as are referred to
in this sub-clause shall be paid by the Security Trustee (or any such
Receiver) the same shall be repaid by the Charging Company on demand
with interest (as well after as before judgment) at the highest rate
for the time being in effect under the Facilities Agreement from the
date of payment until the date of reimbursement. This Deed shall be a
security for the reimbursement to the Security Trustee of such monies
together with interest as aforesaid;
9.12 it shall:-
9.12.1 notify the Security Trustee forthwith upon the acquisition by
that Charging Company of any freehold or leasehold property;
9.12.2 insofar as it is lawfully able to do so, on written demand made
to that Charging Company by the Security Trustee and at the
reasonable cost of the Charging Company, execute and deliver to
the Security Trustee any legal mortgage in favour of the Security
Trustee of any freehold or (subject to any prohibition on
charging in the relevant lease) leasehold property which becomes
vested in it after the date of this Deed (in similar form and
terms to the legal mortgage in this Deed) which the Security
Trustee may reasonably require;
In the case of any leasehold property in relation to which the consent
of the landlord in whom the reversion of that lease is vested is
required in order for the Charging Company to perform any of its
obligations under this Clause 9.12, the Charging Company shall not be
required to perform that particular obligation unless and until it has
obtained the landlord's consent (which it shall use its reasonable
endeavours to do);
9.13 it shall, in respect of any freehold or leasehold land which it may
hereafter acquire and which is registered land (or unregistered land
subject to compulsory first
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14
registration) apply to the Chief Land Registrar for the registration
of a Restriction against the registered titles in the following
terms:-
"Except under an order of the Registrar no disposition by the
proprietor of the land is to be registered without the consent of the
proprietor for the time being of the Charge dated [___] in favour of
The Governor and Company of the Bank of Scotland."
10 RECEIVABLES
10.1 Each of the Charging Companies hereby covenants that during the
continuance of this security it shall:-
10.1.1 promptly get in and realise all Receivables in the ordinary
course of its business and pay into a denominated account (the
"Collections Account") with the Security Trustee or to such
account as the Security Trustee shall from time to time direct
all monies which it may receive in respect of the same forthwith
on receipt;
10.1.2 without prejudice to the foregoing, in the event of receipt or
recovery of any amounts referred to in sub-clause 10.1.1 by any
Charging Company, otherwise than by credit to the Collections
Account, the Charging Company shall pay the same to the
Collections Account forthwith upon receipt or recovery and in
like funds as received or recovered by the relevant Charging
Company and such Charging Company shall in the meantime hold the
same on trust for this purpose;
10.1.3 deal with such Receivables in accordance with any directions
from time to time given by the Security Trustee and in default of
and subject to any such directions deal with the same only in the
ordinary course of getting in and realising the same (without
selling assigning factoring or discounting the same in any way);
10.1.4 if called upon to do so by the Security Trustee execute and
deliver to the Security Trustee a legal assignment of the
Receivables to the Security Trustee (to the extent that the
Receivables have not already been assigned to the Security
Trustee) on such terms as the Security Trustee may require and
give notice thereof to the debtors from whom the Receivables are
due owing or incurred and take any other steps as the Security
Trustee may require to perfect such legal assignment;
10.1.5 not without the prior consent of the Security Trustee sell,
assign, factor, discount, release, exchange, compound, set-off,
grant time or indulgence in respect of or in any other manner
deal with all or any of the Receivables save as hereinbefore
expressly provided PROVIDED ALWAYS that no set-off arising by
operation of law or by virtue of any equitable rights of set-off
shall constitute a breach of this Clause 10.1.5.
10.2 The Collections Account must be maintained at a branch of the Security
Trustee.
10.3 Before the security constituted by this Deed shall have been enforced
the monies credited to the Collections Account may be withdrawn by the
relevant Charging Company and applied by it for any lawful purpose.
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15
10.4 Amounts standing to the credit of each Collections Account shall bear
interest at a fair market rate agreed between the Security Trustee and
the relevant Charging Company and in default of agreement at the
Security Trustee's standard rate for deposits of this size and nature.
10.5 Upon the security constituted by this Deed being enforced the Security
Trustee (or a Receiver) may (subject to the payment of any claims
having priority to this security) withdraw amounts standing to the
credit of each Collections Account to meet any amount due and payable
in respect of the Secured Obligations.
10.6 The Security Trustee, any of the Security Beneficiaries or a Receiver
shall not be responsible to any Charging Company for any non-payment
of any liability of any Charging Company which could be paid out of
monies standing to the credit of the relevant Collections Account, nor
be liable to any Charging Company for any withdrawal wrongly made if
made in good faith.
10.7 The Security Trustee may delegate its powers of withdrawal under this
Clause to the administrative receiver, and/or manager appointed
pursuant to this Debenture.
10.8 Prior to the floating charge constituted by Clause 4.3 hereof being
converted into a fixed charge by operation of law or otherwise and in
the absence of any directions from the Security Trustee under Clause
10.1.3 hereof any moneys received by the relevant Charging Company and
paid into the Collections Account in respect of the Receivables shall
upon payment in stand released from the fixed charge contained in
Clause 4.2.8 hereof and shall stand subject to the floating charge
contained in Clause 4.3 hereof but such release shall in no respects
derogate from the subsistence of the said fixed charge on all other
Receivables for the time being outstanding.
11. THE SECURITY TRUSTEE'S POWERS OF SALE AND LEASING
11.1 The Security Trustee (on behalf of the Security Beneficiaries) may
exercise the statutory power of sale conferred on mortgagees by the
Act free from the restrictions imposed by Section 103 thereof.
11.2 The Secured Obligations shall be deemed to have become due within the
meaning of Section 101 of the Act and the security created by the
Charging Companies by or pursuant to this Deed shall immediately
become enforceable and the power of sale and other powers conferred by
the said Section and/or by Schedule 1 to the Insolvency Act 1986, in
each case as varied or extended by this Deed, and all other powers
conferred on the Security Trustee (for the benefit of the Security
Beneficiaries) by this Deed shall be immediately exercisable at any
time, in relation to the whole or any part of the Charged Property,
after the Security Trustee shall have validly and effectively demanded
the payment or discharge by the Charging Companies or any of them of
all or any of the Secured Obligations. Any demand for payment shall be
valid and effective for the purposes of this sub-clause 11.2
notwithstanding that the demand may contain an inaccurate or
incomplete statement of the Secured Obligations.
11.3 The statutory powers of leasing, letting, entering into agreements for
leases or lettings and accepting and agreeing to accept surrenders of
leases conferred by Sections 99 and 100 of the Act shall be
exercisable by the Security Trustee at any time after the Security
Trustee shall have demanded the payment or discharge by the Charging
Companies or any of them of all or any of the Secured Obligations in
accordance with the provisions of Clause 11.2 and whether or not the
Security
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16
Trustee shall then be in possession of that part of the Charged
Property proposed to be leased so as to authorise the Security Trustee
to make a lease or agreement for lease at a premium and for any length
of term and generally without any restriction on the kinds of leases
and agreements for lease that the Security Trustee may make and
generally, without the necessity for the Security Trustee to comply
with any restrictions imposed by or any other provisions of the said
Sections 99 and 100, the Security Trustee may delegate such powers to
any person but no such delegation shall preclude the subsequent
exercise of any such powers by the Security Trustee itself or a
subsequent delegation by the Security Trustee to any other person; and
any such delegation may be revoked by the Security Trustee at any
time.
12. CONSOLIDATION OF SECURITIES
Sub-section (1) of Section 93 of the Act shall not apply to this Deed.
13. APPOINTMENT AND POWERS OF RECEIVER
13.1 At any time after the security constituted by this Deed becomes
enforceable and while it remains so or at the request of the relevant
Charging Company the Security Trustee (on behalf of the Security
Beneficiaries) may appoint one or more persons to be a Receiver of the
whole or any part of the Charged Property and/or of the income
thereof. The Security Trustee may:-
13.1.1 (subject to the provisions of the Insolvency Act 1986) remove
any Receiver previously appointed hereunder; and
13.1.2 appoint another person or persons as Receiver either in place
of a Receiver so removed or who has otherwise ceased to act or to
act jointly with a Receiver previously appointed.
13.2 If at any time and by virtue of any such appointment(s) any two or
more persons shall hold office as Receiver of the whole or the same
part or parts of the Charged Property and/or the income thereof they
shall have power to act severally (unless the contrary shall be stated
in the deed(s) or other instrument(s) appointing them).
13.3 Every Receiver shall (subject to any limitations or restrictions
expressed in the deed or other instrument appointing him but
notwithstanding any winding-up or dissolution of the Charging
Companies or any of them) have and be entitled to exercise all powers
conferred by the Act and/or the Insolvency Act 1986 and/or any other
statute conferring power on a Receiver and in particular by way of
addition thereto but without limiting any general powers hereinbefore
referred to (and without prejudice to the Security Trustee's powers)
the Receiver shall have power:-
13.3.1 to take possession of collect and get in the Charged Property
and/or income in respect of which he was appointed;
13.3.2 to carry on or concur in carrying on the business of any of the
Charging Companies and raise money from the Security
Beneficiaries and others without security or on the security of
all or any of the Charged Property;
13.3.3 to alter, improve, develop, complete, construct, modify,
refurbish or repair any building or land and to complete or
undertake or concur in the completion or undertaking (with or
without modification) of any project in which any of the Charging
Companies were concerned or interested prior to
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17
his appointment being a project for the alteration, improvement,
development, completion, construction, modification,
refurbishment or repair of any building or land;
13.3.4 to sell or concur in selling leasing or otherwise disposing of
the whole or any part of the Charged Property in respect of which
he was appointed without the need to observe the restriction
imposed by Section 103 of the Act;
13.3.5 to carry out any sale lease or other disposal of the whole or
any part of the Charged Property by conveying transferring
assigning or leasing in the name of any of the Charging Companies
and for that purpose to enter into covenants and other
contractual obligations in the name of and so as to bind any of
the Charging Companies;
13.3.6 to take any such proceedings as he shall think fit in respect
of the Charged Property and/or income in respect of which he was
appointed in the name of any of the Charging Companies or
otherwise including proceedings for recovery of rent or other
monies in arrear at the date of his appointment;
13.3.7 to enter into or make any such agreement, arrangement or
compromise as he shall think fit;
13.3.8 to insure the Charged Property as he shall think fit or as the
Security Trustee shall direct and renew any insurances;
13.3.9 to appoint and employ such managers, officers and workmen and
engage such professional advisers as he shall think fit including
without prejudice to the generality of the foregoing power to
employ his partners and firm;
13.3.10 to operate any rent review clause in respect of any property
in respect of which he was appointed or any part thereof and to
apply for any new or extended lease;
13.3.11 to do all such other things as may seem to him to be
incidental or conducive to any other power vested in him in the
realisation of the security hereby constituted.
13.4 In making any sale or other disposal in the exercise of their
respective powers the Receiver or the Security Trustee (on behalf of
the Security Beneficiaries) may accept as and by way of consideration
for such sale or other disposal cash, shares, loan capital or other
obligations including, without limitation, consideration fluctuating
according to or dependent upon profit or turnover and consideration
the amount whereof is to be determined by a third party. Any such
consideration may be receivable in a lump sum or by instalments and
upon receipt by the Receiver shall ipso facto be and become charged
with the payment of the Secured Obligations. Any contract for any such
sale or other disposal by the Receiver or the Security Trustee may
contain conditions excluding or restricting the personal liability of
the Receiver, and the Security Trustee and/or the Security
Beneficiaries.
13.5 All monies received by the Security Trustee or by any Receiver
appointed under this Deed shall (subject to the rights and claims of
any person having a security ranking in priority to the security
constituted by this Deed) be applied in the following order:-
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13.5.1 in satisfaction of the costs, charges and expenses of and
incidental to the Receiver's appointment and the payment of his
remuneration;
13.5.2 in the payment and discharge of any liabilities incurred by the
Receiver on the Charging Companies' behalf in the exercise of any
of the powers of the Receiver;
13.5.3 in providing for the matters (other than the remuneration of
the Receiver) specified in the first three paragraphs of
sub-section (8) of Section 109 of the Act;
13.5.4 in or towards the satisfaction of the Secured Obligations and
all the other obligations of the Charging Companies under this
Deed; and any surplus shall be paid to the Charging Companies or
other person entitled thereto. The provisions of this Clause 13.5
and Clause 13.7 shall take effect as and by way of variation and
extension to the provisions of the said Section 109 which
provisions as so varied and extended shall be deemed incorporated
herein.
13.6 Every Receiver so appointed shall be deemed at all times and for all
purposes to be the agent of the Charging Companies and (subject to the
provisions of the Companies Act 1985 and the Insolvency Act 1986) the
Charging Companies shall be solely responsible for his acts and
defaults (except for wilful acts of default and recklessness) and for
the payment of his remuneration.
13.7 Every Receiver so appointed shall be entitled to remuneration for his
services at a rate to be fixed by agreement between him and the
Security Trustee (or failing such agreement to be fixed by the
Security Trustee) appropriate to the work and responsibilities
involved upon the basis of charging from time to time adopted in
accordance with his current practice or the current practice of his
firm and without being limited to the maximum rate specified in
Section 109(6) of the Act.
13.8 Only monies actually paid by any such Receiver to the Security Trustee
in satisfaction or discharge of the Secured Obligations shall be
capable of being applied by the Security Trustee in satisfaction
thereof.
13.9 All or any of the powers, authorities and discretions which are
conferred by this Deed either expressly or impliedly by or upon a
Receiver may be exercised by the Security Trustee in relation to the
whole of the Charged Property or any part thereof or notwithstanding
the appointment of a Receiver of such property or any part thereof.
14. POWER OF ATTORNEY
14.1 Each of the Charging Companies hereby irrevocably appoints:-
14.1.1 the Security Trustee;
14.1.2 each and every person to whom the Security Trustee shall from
time to time have delegated the exercise of the power of attorney
conferred by this Clause; and
14.1.3 any Receiver appointed hereunder and for the time being holding
office as such,
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severally to be its attorney and on its behalf and in its name or
otherwise to execute and do all such assurances, acts and things which
may be required (or which the Security Trustee or any Receiver
appointed hereunder shall consider requisite) for the protection of
any security created hereunder and following the occurrence of an
Event of Default or a Potential Event of Default and for carrying out
any obligation imposed on any of the Charging Companies by or pursuant
to this Deed including (without prejudice to the generality of the
foregoing) generally for enabling the Security Trustee and the
Receiver to exercise their respective powers conferred on them by this
Deed or by the Act or the Insolvency Act 1986. The Security Trustee
shall have full power to delegate the power conferred on it by this
Clause but no such delegation by the Security Trustee to any person
shall preclude the subsequent exercise of such power by the Security
Trustee itself or any subsequent delegation thereof by the Security
Trustee to any other person; and the Security Trustee may revoke any
such delegation at any time.
14.2 Each of the Charging Companies hereby ratifies and confirms and agrees
to ratify and confirm whatever such attorney as is mentioned in Clause
14.1 shall lawfully do or in good faith purport to do in the exercise
or purported exercise of all or any of the powers, authorities and
discretions referred to in Clause 14.1.
14.3 The power of attorney hereby granted is as regards any such Receiver
(and as each of the Charging Companies hereby acknowledges) granted
irrevocably and for value as part of the security constituted by this
Deed to secure proprietary interests of and the performance of
obligations owed to the respective donees within the meaning of the
Powers of Attorney Act 1971.
15. PROTECTION OF THIRD PARTIES
No person dealing with the Security Trustee or with any Receiver of the
Charged Property or any part thereof appointed by the Security Trustee or
with any delegate or sub-delegate of the Security Trustee shall be
concerned to enquire whether any event has happened upon which any of the
powers, authorities and discretions conferred by or pursuant to this Deed
in relation to the Charged Property or any part thereof are or may be
exercisable by the Security Trustee or by any such Receiver, delegate or
sub-delegate or otherwise as to the propriety or regularity of acts
purporting or intended to be in exercise of any such powers and all the
protection to purchasers contained in Sections 104 and 107 of the Act and
Section 42(3) of the Insolvency Act 1986 shall apply to any person
purchasing from or dealing with the Security Trustee or any such Receiver,
delegate or sub-delegate in like manner as if the statutory powers of sale
and of appointing a Receiver in relation to the Charged Property had not
been varied or extended by this Deed.
16. NEW ACCOUNTS
If any of the Security Beneficiaries shall at any time receive notice
(whether actual or otherwise) of any subsequent Security Interest other
than a Permitted Security Interest affecting the Charged Property or any
part of it, the relevant Security Beneficiary may open a new account or
accounts for any of the Charging Companies in its books and if it does not
in fact open any such new account then, unless the relevant Security
Beneficiary gives written notice to the relevant Charging Company to the
contrary, the relevant Security Beneficiary shall nevertheless be treated
as if it had in fact done so at the time when it received or was deemed to
have received such notice. As from that time and unless such written notice
shall be given to any of the Charging Companies, all payments by or on
behalf of such Charging Company to the relevant Security Beneficiary shall
be credited, or treated as having been credited, to a new account of such
Charging Company and shall not operate to reduce such
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20
Charging Company's indebtedness and other liabilities to the relevant
Security Beneficiary at the time when the relevant Security Beneficiary
received or was deemed to have received such notice.
17. RIGHTS AS BETWEEN EACH CHARGING COMPANY, THE OTHER CHARGING COMPANIES AND
THE SECURITY TRUSTEE (ON BEHALF OF THE SECURITY BENEFICIARIES)
It is hereby agreed and declared by each Charging Company that:-
17.1 As between such Charging Company and the Security Trustee the property
hereby charged by such Charging Company shall so far as concerns the
Security Trustee be deemed to be a primary and principal security
(notwithstanding that the property is hereby charged by such Charging
Company by way of collateral security only) and accordingly such
Charging Company shall not be released or discharged nor shall the
security constituted by or pursuant to this Deed be impaired, affected
or revoked by any act, omission, transaction, limitation, matter,
thing or circumstance whatsoever which but for this provision might
operate to release or exonerate such Charging Company or all or any
part of the security constituted by or pursuant to this Deed or
reduce, impair or affect such security or cause all or any part of the
Secured Obligations to be irrecoverable from or unenforceable against
the Charging Companies or any other person or to discharge, reduce,
affect or impair the security constituted by or pursuant to this Deed,
including without limitation:-
17.1.1 any time, waiver or indulgence granted to any of the Charging
Companies or any other person or the forbearance of the Security
Trustee in enforcing the obligations of any of the Charging
Companies or any other person under the Facilities Agreement or
hereunder or in respect of any other guarantee, security,
obligation, right or remedy;
17.1.2 the recovery of any judgment against any of the Charging
Companies or any other person or any action to enforce the same;
17.1.3 the taking of any other security from any of the Charging
Companies or any other person or the variation, compromise,
renewal or release of, or the failure, refusal or neglect to
take, perfect or enforce, any rights, remedies or securities from
or against any of the Charging Companies or any other person;
17.1.4 any alteration in the constitution of any of the Charging
Companies or any defect in or irregular exercise of the powers of
any of the Charging Companies (including, without limitation the
borrowing powers of the Charging Companies) or any other person
or any legal limitations, disability, incapacity or other
circumstances relating to any of the Charging Companies or any
other person;
17.1.5 subject as hereinafter provided, notwithstanding any amendment
or supplement to or variation of the Facilities Agreement, the
Security Documents or any other document or security whether or
not the same shall increase the amount of the Facilities or the
amount of any sums payable to the Security Trustee (on behalf of
the Security Beneficiaries) and without prejudice to anything
else herein contained, this Deed shall be a continuing security
for any such increased amount or liability;
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21
17.1.6 the insolvency, bankruptcy, liquidation or reorganisation of,
or analogous proceedings relating to any of the Charging
Companies or any other person or any composition or arrangement
made by any of them with the Security Trustee and/or the Security
Beneficiaries or any other person or any transfer or extinction
of any liabilities of any of the Charging Companies or any other
person by any law, order, regulation, decree, court order or
similar instrument; or
17.1.7 any irregularity, unenforceability or invalidity of any
obligations of any of the Charging Companies or any other person
under any security or document (including this Deed) (to the
intent that the security constituted by or pursuant to this Deed
shall remain in full force and this Deed be construed accordingly
as if there were no such irregularity, unenforceability or
invalidity);
and so that as a separate and independent stipulation all sums,
obligations and liabilities the payment and discharge of which is
expressed to be secured by this Deed which may not be recoverable from
another Charging Company by reason of any act, omission, transaction,
limitation, matter, thing or circumstance whatsoever shall
nevertheless be recoverable from such Charging Company as though the
same had been incurred by such Charging Company and such Charging
Company was the sole or principal debtor in respect thereof.
17.2 Until all sums and liabilities intended to be secured by these
presents have been paid off and satisfied in full, such Charging
Company will not, unless the Security Trustee shall otherwise consent
or, in the case of Clause 17.2.2 and 17.2.3 direct:-
17.2.1 exercise any right of subrogation or contribution or any other
right or remedy which it may have in respect of any sum recovered
under these presents and so that all claims and other rights and
remedies it may have against any of the Charging Companies in
relation thereto (including, except to the extent required by the
mandatory provisions of any applicable laws, any right of set-off
or counterclaim) shall be subject and subordinate to the prior
payment and satisfaction in full to the Security Trustee for the
benefit of the Security Beneficiaries of all sums and liabilities
expressed to be hereby secured;
17.2.2 at any time after the security constituted by these presents
has become enforceable and while it remains so, claim or receive
payment of any monies due to it by any of the Charging Companies
or exercise any other right or remedy (including, except to the
intent required by the mandatory provisions of any applicable
laws, any rights of set-off or counterclaim);
17.2.3 subject to the terms of the Intercreditor Agreement prove in
any liquidation, bankruptcy, insolvency, reorganisation or
analogous proceedings relating to any of the Charging Companies
in competition with the Security Trustee or the Security
Beneficiaries for any sums or liabilities owing or incurred to it
by any of the Charging Companies;
17.2.4 be entitled to the benefit of any security held by or on behalf
of the Security Trustee in respect of any sums and liabilities
expressed to be secured by these presents;
17.2.5 take or hold security from any of the Charging Companies.
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Any monies received and any security taken or held by a Charging
Company such as is referred to in this sub-clause 17.2 and whether
with or without the consent of the Security Trustee and whether or not
in breach of the provisions of this Clause 17.2 shall be held by such
company in trust to pay or hold the same for the Security Trustee in
or towards discharge or, as the case may be, as security for the
liabilities hereby secured.
17.3 The Security Trustee (on behalf of the Security Beneficiaries) shall
be entitled to enforce the security constituted by these presents
against any one or more of the Charging Companies without making any
demand on or taking any proceedings against any of the other Charging
Companies or any other person or exhausting any right or remedy
against any of the Charging Companies or any other person or taking
any action to enforce any part of the security constituted by any of
the other Security Documents or any other guarantee or security and so
that the Security Trustee shall be at liberty but not bound to resort
to any other means of payment at any time and in any order as the
Security Trustee thinks fit without thereby diminishing or affecting
the security constituted by these presents and the security
constituted by these presents may be enforced either for the payment
of the ultimate balance after other means of payment have been
resorted to or for the balance due at any time, notwithstanding that
other means of payment have not been resorted to and, in the latter
case, without entitling any Charging Company to any benefit from
and/or any right of contribution in respect of such other means of
payment until all sums and liabilities expressed to be secured by
these presents have been finally paid off or satisfied in full.
17.4 The security constituted by these presents is in addition to and is
not to prejudice or affect or be prejudiced or affected by:-
17.4.1 any other guarantee, security or lien for the sums and
liabilities intended to be hereby secured which is or are now or
may thereafter be held by any of the Security Beneficiaries from
any Charging Company or any other person; or
17.4.2 by the omission of the Security Trustee or Security
Beneficiaries to take any such security.
17.5 Any dividends or payment received by or on behalf of the Security
Trustee in respect of the sums and liabilities expressed to be secured
by these presents in any insolvency, bankruptcy, liquidation,
reorganisation or similar proceedings, shall for the purposes of this
Deed be taken to discharge those sums and liabilities only to the
extent of the actual amount so received and so that the Security
Trustee (on behalf of the Security Beneficiaries) may prove in any
insolvency, bankruptcy, liquidation, reorganisation or similar
proceedings of the Charging Company concerned for the full amount then
owing to it.
18. CONSOLIDATION OF ACCOUNTS AND SET-OFF
In addition to any general lien or similar right to which it may be
entitled by operation of law, each of the Security Beneficiaries shall have
the right at any time after the security hereby constituted has become
enforceable and while it remains so and without notice to the Charging
Companies (as well before as after making any demand hereunder) to combine
or consolidate all or any of the Charging Companies' then existing accounts
(including the Collections
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23
Account) with and liabilities to them and to set-off or transfer any sum or
sums standing to the credit of any one or more of such accounts (including
the Collections Account) in or towards satisfaction of any of the
liabilities of all or any of the Charging Companies to the Security
Beneficiaries on any other account or in any other respect. The liabilities
referred to in this Clause may be actual, contingent, primary, collateral,
several or joint liabilities, and the accounts, sums and liabilities
referred to in this Clause may be denominated in any currency. The
existence of the floating charge contained in Clause 4.3 hereof over the
proceeds of collection of any Receivables will not prejudice the right
contained in this Clause 18 to combine or consolidate accounts.
19. CURRENCY
19.1 All monies received or held by the Security Trustee or any Receiver
under this Deed may be converted into such other currency as the
Security Trustee or Receiver considers necessary or desirable to cover
the obligations and liabilities comprised in the Secured Obligations
in that other currency at the Security Trustee's spot rate of exchange
then prevailing for purchasing that other currency with the existing
currency.
19.2 No payment to the Security Trustee (whether under any judgement or
court order or otherwise) shall discharge the obligation or liability
of the relevant Charging Company in respect of which it was made
unless and until the Security Trustee shall have received payment in
full in the currency in which the obligation or liability was incurred
and to the extent that the amount of any such payment shall on actual
conversion into such currency fall short of such obligation or
liability expressed in that currency the Security Trustee shall have a
further separate cause of action against the relevant Charging Company
and shall be entitled to enforce the security constituted by this Deed
to recover the amount of the shortfall.
20. SUSPENSE ACCOUNT
All monies received, recovered or realised by the Security Trustee under
this Deed may in the discretion of the Security Trustee be credited to any
suspense or impersonal account and may be held in such account for so long
as the Security Trustee thinks fit (with interest accruing thereon at such
rate, if any, as the Security Trustee may deem fit for the account of the
relevant Charging Company) pending their application from time to time (as
the Security Trustee shall be entitled to do in its discretion) in or
towards the discharge of any of the Secured Obligations.
21. TIME AND INDULGENCES
21.1 The Security Trustee may at any time or times without discharging or
in any way affecting the security created by or pursuant to this Deed
or any remedy in respect of such security, grant to any of the
Charging Companies time or indulgence or abstain from asserting,
calling, exercising or enforcing any remedies, securities, guarantees
or other rights which it may now or hereafter have from or against any
of the Charging Companies.
21.2 The Security Trustee may in its discretion grant time or other
indulgence, or make any other arrangement, variation or release with,
any person or persons not party hereto (whether or not such person or
persons are jointly liable with the Charging Companies) in respect of
any of the Secured Obligations or of any other security therefor or
guarantee in respect thereof without prejudice either to the security
constituted by or pursuant to this Deed or to the liability of the
Charging Companies for the Secured Obligations or the exercise by the
Security Trustee of any rights, remedies and privileges conferred upon
it by this Deed.
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24
22. REMEDIES, WAIVERS, AMENDMENTS AND CONSENTS
22.1 No failure on the part of the Security Trustee or any Receiver to
exercise, and no delay on its part or their part in exercising, any
right or remedy under this Deed will operate as a waiver thereof, nor
will any single or partial exercise of any right or remedy preclude
any other or further exercise thereof or the exercise of any other
right or remedy. The rights and remedies provided in this Deed are
cumulative and not exclusive of any rights and remedies provided by
law.
22.2 Any provision of this Deed may be amended only if the Security Trustee
and the Charging Companies so agree in writing and any breach hereof
may be waived before or after it occurs only if the Security Trustee
so agrees in writing. Any such waiver, and any consent by the Security
Trustee under any provision of this Deed, must be in writing and may
be given subject to any conditions thought fit by the Security
Trustee. Any waiver or consent shall be effective only in the instance
and for the purpose for which it is given.
23. EXPENSES
The Charging Companies agree to pay to the Security Trustee on demand (on a
full indemnity basis) all costs, charges, expenses and other sums properly
incurred or to be incurred by the Security Trustee or the Security
Beneficiaries or by or through any Receiver, attorney, delegate,
sub-delegate, substitute or agent of the Charging Companies, or the
Security Trustee for any of the purposes referred to in this Deed relating
to or in connection with the security over the Charged Property including
(without prejudice to the generality of the foregoing):-
23.1 all liabilities resulting from any delay in paying any stamp duty,
value added tax or other similar taxes imposed on the Charged Property
or in connection with any of the transactions contemplated by this
Deed and all liabilities resulting from any delay in paying any such
taxes;
23.2 the remuneration of any such Receiver, attorney, delegate,
sub-delegate, substitute or agents of the Charging Companies and of
any other servants or agents employed by the Security Trustee for any
purposes connected with the enforcement or attempted enforcement of
this Deed or the protection preservation realisation or attempted
protection or preservation of the Charged Property; and
23.3 all costs charges and expenses (whether in respect of litigation or
not) and incurred in the protection, realisation or enforcement of
this Deed or the collection and recovery of any monies from time to
time arising under such security (or any security collateral or
supplemental thereto) or in insuring, inspecting, maintaining,
completing, managing, letting, realising or exercising any other
power, authority or discretion in relation to the Charged Property or
any part thereof incurred under this Deed;
to the intent that subject as provided herein the Security Trustee shall be
afforded a full and unlimited indemnity in respect thereof.
24. PROVISIONS SEVERABLE
Every provision contained in this Deed shall be severable and distinct from
every other such provision and if at any time any one or more of such
provisions is or becomes invalid, illegal
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25
or unenforceable, the validity, legality and enforceability of the
remaining such provisions shall not in any way be affected thereby.
25. AVOIDANCE OF PAYMENTS
25.1 No assurance, security or payment which may be avoided under any law
relating to bankruptcy, insolvency or winding-up (including Sections
238, 239, 244 or 245 of the Insolvency Act 1986), and no release,
settlement or discharge given or made by the Security Trustee (on
behalf of the Security Beneficiaries) on the faith of any such
assurance, security or payment, shall prejudice or affect the right of
the Security Trustee to enforce the security created by or pursuant to
this Deed to the full extent of the Secured Obligations.
25.2 Any settlement or discharge between a Charging Company and any
Security Beneficiary shall be conditional upon no security or payment
to such Security Beneficiary by that Charging Company or any other
person being avoided or set aside or ordered to be refunded or reduced
by virtue of any provision or enactment relating to bankruptcy,
insolvency or liquidation for the time being in force and accordingly
(but without limiting the other rights of such Security Beneficiary
hereunder), such Security Beneficiary shall be entitled to recover
from that Charging Company the value which such Security Beneficiary
has placed upon such security or the amount of any such payment as if
such settlement or discharge had not occurred.
25.3 Subject to Clause 25.2, upon all the Secured Obligations having been
paid or discharged in full and all the Security Beneficiaries having
ceased to have any further obligations under any Security Documents
whether actual or contingent to make any credit or accommodation to
any Group Company, the Security Trustee will, at the request and cost
of the Charging Companies, immediately execute, reassign and/or do all
such deeds, acts and things as may be reasonably necessary to release
the Charged Property from the security and guarantees created by or
pursuant to this Deed.
26. DISCRETIONS
26.1 Any liberty or power which may be exercised or any determination which
may be made hereunder by the Security Trustee, as against the Charging
Companies, may be exercised or made (unless otherwise expressly
provided in this Deed or in the Facilities Agreement) in the absolute
and unfettered discretion of the Security Trustee which shall not be
under any obligation to give reasons therefor.
26.2 In this Deed where any matter fact or opinion is qualified by the
words "reasonable" or "material" or any variations thereof the
determination by the Security Trustee of what is reasonable or
material shall be binding on the Charging Companies unless the
Charging Company concerned shows that such determination is
unreasonable.
27. ASSIGNMENT
The Security Trustee shall have a full and unfettered right to assign the
whole (but not part) of the benefit of this Deed to any person to whom the
Security Beneficiaries have the right to assign their interest in the
Facilities Agreement.
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26
28. INTERCREDITOR AGREEMENT AND FACILITIES AGREEMENT TO PREVAIL
Where any provision in this Deed conflicts with a provision of the
Intercreditor Agreement and/or the Facilities Agreement the terms of the
Intercreditor Agreement shall prevail for so long as the same remains in
force and thereafter the terms of the Facilities Agreement shall prevail
for so long as the same remains in full force and effect. Any consent,
waiver or concession granted under the Facilities Agreement shall also
operate as a consent, waiver or concession hereunder. Where the context
permits, the rights and remedies of the Security Trustee under the
Facilities Agreement and the Intercreditor Agreement and this Deed are
cumulative.
29. NOTICES
29.1 All communications to made hereunder shall be made in writing.
29.2 Any notices, proceedings or other documents to be served on any of the
Charging Companies pursuant to this Deed shall be addressed to it at
its registered office for the attention of the Managing Director or at
such other address as a Charging Company may hereafter advise the
Security Trustee in writing.
29.3 Any notice to the Security Trustee should be addressed if despatched
by mail to the Security Trustee at 124 Colmore Row, Birmingham B3 3AU
or at such other address as it may hereafter advise the other parties
in writing.
29.4 Any notice to any Charging Company shall be deemed to have been
given:-
29.4.1 if posted, on the second Business Day following the day on
which it has been properly despatched by first class mail
(airmail, if appropriate) postage prepaid; and
29.4.2 if sent by facsimile transmission, on the Business Day on which
transmitted or if sent after 5.00 p.m. at 9.30 a.m. on the next
following business day or, in the case of a written notice lodged
by hand, at the time of actual delivery thereof at the address
referred to above.
29.5 Any notice to the Security Trustee shall be deemed to have been given
only on actual receipt by the Security Trustee and the Security
Trustee will promptly acknowledge receipt of any such notice.
30. LAW AND JURISDICTION
This Deed shall be governed and construed in accordance with English law
and the parties hereto hereby irrevocably submit to the non-exclusive
jurisdiction of the English Courts.
31. MEMORANDUM AND ARTICLES
Each of the Charging Companies hereby certifies that its creation by this
Deed of Security in favour of the Security Trustee (for the benefit of the
Security Beneficiaries) does not contravene any of the provisions of their
respective Memoranda and Articles of Association.
IN WITNESS whereof the Charging Companies have each duly executed this Deed the
day and the year first before written
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27
FIRST SCHEDULE
The Charging Companies
Company Name Registered No. Registered Office
- ------------ -------------- -----------------
DDI Europe Limited 3731403 Green Lane, Tewkesbury,
Gloucestershire GL20 8DN
DDI Group Limited 445250 Green Lane, Tewkesbury,
Gloucestershire GL20 8DN
Classical Circuits Limited 1034995 Green Lane, Tewkesbury,
Gloucestershire GL20 8DN
DDI Technologies Limited 1336602 Green Lane, Tewkesbury,
Gloucestershire GL20 8DN
Pretan Engineering Limited 2407995 Green Lane, Tewkesbury,
Gloucestershire GL20 8DN
Integrated Designs & Systems Limited 2624416 Green Lane, Tewkesbury,
Gloucestershire GL20 8DN
Dynamic Details Limited 3232495 Green Lane, Tewkesbury,
Gloucestershire GL20 8DN
Zlin Electronics Limited 1338479 Green Lane, Tewkesbury,
Gloucestershire GL20 8DN
DDI Precision Limited 2900127 Green Lane, Tewkesbury,
Gloucestershire GL20 8DN
DDI International Limited 3328896 Green Lane, Tewkesbury,
Gloucestershire GL20 8DN
Thomas Walter Limited 1415705 Green Lane, Tewkesbury
GL20 8DN
DDI Sales Limited 03292688 Green Lane, Tewkesbury
GL20 8DN
Redlab Limited 03367094 Green Lane, Tewkesbury
GL20 8DN
Krizantem Limited 03366229 Green Lane, Tewkesbury
GL20 8DN
BWMP (Holdings) Limited 03085865 Green Lane, Tewkesbury
GL20 8DN
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28
THE SECOND SCHEDULE
Part I
Details of Registered Land
Property Title No.
Leasehold property at Unit 17 Alexandra Way, Ashchurch Business GR164514
Centre, Tewkesbury, Gloucester
Leasehold property at 9 Harris Road also known as 32 Harris WT177524
Road, Porte Marsh Industrial Estate, Calne, Wiltshire
Leasehold property at Woburn Road Industrial Estate, Postley BD199250
Road, Kempston, Bedfordshire
Part II
Details of Unregistered Land
Leasehold property at First Floor, Phase 4 Building Racal Site, Northway
Industrial Estate, Green Lane, Tewkesbury, Gloucester
Leasehold property at 214 Red Lion Road, Tolworth, Surbiton, Surrey
Leasehold property at 21-23 Harris Road, Porte Marsh Industrial Estate, Calne,
Wiltshire
Leasehold property at Unit C Belcon Industrial Estate, Bingley Road, Hoddesdon,
Hertfordshire
Leasehold property at Axis 10, John Tate Road, Foxholes Business Park, Hertford
Leasehold property at Unit 8, Harris Road, Porte Marsh Industrial Estate, Calne,
Wiltshire
Leasehold property at Unit 9, Harris Road, Porte Marsh Industrial Estate, Calne,
Wiltshire
Leasehold property at Unit 10, Harris Road, Porte Marsh Industrial Estate,
Calne, Wiltshire
Leasehold property at Unit 1, Harris Road, Porte Marsh Industrial Estate, Calne,
Wiltshire
Leasehold property at Unit 2, Harris Road, Porte Marsh Industrial Estate, Calne,
Wiltshire
Leasehold property at Unit 4, Harris Road, Porte Marsh Industrial Estate, Calne,
Wiltshire
Leasehold property at Unit 5, Harris Road, Porte Marsh Industrial Estate, Calne,
Wiltshire
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29
THE THIRD SCHEDULE
The Guarantee
1. The Guarantee is to be a continuing security for the whole amount now due
or owing to the Security Trustee (on behalf of the Security Beneficiaries)
or which may hereafter at any time become due or owing to the Security
Trustee (on behalf of the Security Beneficiaries) as provided for in Clause
2 (including any and all liabilities interest and bank charges arising
pursuant to and in connection therewith). References in this Schedule to
payments of sums owing to or security held by or rights of the Security
Trustee are references to the Security Trustee on its own behalf and on
behalf of the Security Beneficiaries.
2. For all purposes of the liability of the Charging Companies and each of
them to the Security Trustee (on behalf of the Security Beneficiaries)
under the Guarantee (including in particular but without prejudice to the
generality of the foregoing the liability of the Charging Companies for
interest) every sum of money which may now be or which hereafter may from
time to time become due or owing to the Security Trustee (on behalf of the
Security Beneficiaries) (or would have become so due or owing were it not
for the winding up of any other company) shall be deemed to continue due
and owing to the Security Trustee (on behalf of the Security Beneficiaries)
until the same shall be actually repaid to the Security Trustee (on behalf
of the Security Beneficiaries) notwithstanding the winding up of any
company or any other event whatever.
3. The Guarantee is to be in addition to and is not to prejudice or be
prejudiced by any other securities or guarantees (including any guarantee
signed by the Charging Companies or any of them) which the Security Trustee
(on behalf of the Security Beneficiaries) or the Security Beneficiaries may
now or hereafter hold on account of the Secured Obligations and is to be
binding on the Charging Companies and each of them as a continuing security
notwithstanding any payments from time to time made to the Security
Trustee, (on behalf of the Security Beneficiaries) or the Security
Beneficiaries or any settlement of account or any other thing whatsoever.
4. The Guarantee is to be applicable to the ultimate balance that may become
due to the Security Trustee (on behalf of the Security Beneficiaries) or
the Security Beneficiaries from any Charging Company and until payment of
such balance no Charging Company shall be entitled to participate in any
security held or money received by the Security Trustee (on behalf of the
Security Beneficiaries) on account of such balance or to stand in the place
of the Security Trustee or any of the Security Beneficiaries in respect of
any such security or money until all monies and liabilities hereby
guaranteed have been paid or discharged in full.
5. Any admission or acknowledgement in writing by a director of any Charging
Company or any duly authorised person on behalf of any Charging Company of
the amount of the indebtedness of the relevant Charging Company or of other
matters relating to the Guarantee or any judgment or award of a competent
court or tribunal in the United Kingdom or elsewhere obtained by the
Security Trustee (on behalf of the Security Beneficiaries) or any of the
Security Beneficiaries themselves against any or all of the Charging
Companies or proof by the Security Trustee (on behalf of the Security
Beneficiaries) or any of the Security Beneficiaries themselves in a winding
up of a Charging Company which is admitted or, in the absence of manifest
error, any statement of account furnished by the Security Trustee (on
behalf of the Security Beneficiaries) or any of the Security Beneficiaries
themselves (the correctness of which is certified by the Security Trustee),
shall be prima facie evidence binding on the Charging Companies and each of
them in the absence of proof to the contrary.
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30
6. The Security Trustee (on behalf of the Security Beneficiaries) or any of
the Security Beneficiaries themselves may without thereby affecting the
rights of the Security Trustee (on behalf of the Security Beneficiaries) or
any of the Security Beneficiaries themselves hereunder at any time and from
time to time (whether before or after any demand for payment made by the
Security Trustee under or any notice of determination of this Guarantee),
refuse or grant (as the case may be) further credit or further financial
facilities in addition to the Facilities to any Charging Company or the
Charging Companies and the Security Trustee (on behalf of the Security
Beneficiaries) or any of the Security Beneficiaries themselves may, without
thereby affecting such rights, accept compositions from and make any other
arrangements with any of the Charging Companies or any persons liable to
the Security Trustee on behalf of the Security Beneficiaries or any of the
Security Beneficiaries themselves in respect of securities held or to be
held by the Security Trustee and enter into, give up and waive, modify,
exchange or abstain from perfecting or taking advantage of or enforcing
such securities, guarantees or other contracts or the proceeds of any of
the foregoing, discharge any parties thereto and realise any securities in
such manner as the Security Trustee may think expedient.
7. In the event of any of the Charging Companies going into liquidation or
being wound up or reconstructed or making any arrangement with its
creditors, any dividends or payments which the Security Trustee (on behalf
of the Security Beneficiaries) or any of the Security Beneficiaries
themselves may receive from the Charging Companies or any of them or any
other persons shall be taken and applied as payments in gross and shall not
prejudice the right of the Security Trustee (on behalf of the Security
Beneficiaries) or any of the Security Beneficiaries themselves to recover
from the Charging Companies or any of them to the full extent of the
Guarantee the ultimate balance which after the receipt of such dividends or
payments may remain owing to the Security Trustee (on behalf of the
Security Beneficiaries) or any of the Security Beneficiaries themselves by
the Charging Companies and secured by the Guarantee.
8. The Security Trustee (on behalf of the Security Beneficiaries) or any of
the Security Beneficiaries themselves may without thereby affecting the
rights of either of them hereunder at any time and from time to time at
their absolute discretion release, discharge, compound with or otherwise
vary or agree to vary the liability under the Guarantee of or make any
other arrangements with the Charging Companies or any of them and no such
release, discharge, composition, variation, agreement or arrangement shall
prejudice or in any way affect the rights and remedies of the Security
Trustee (on behalf of the Security Beneficiaries) or any of the Security
Beneficiaries themselves against any other Charging Company.
9. The Security Trustee (on behalf of the Security Beneficiaries) or any of
the Security Beneficiaries themselves may without prejudice to any other
rights they may have at any time and from time to time place and keep for
such time as they may think prudent any monies received, recovered or
realised under or by virtue of the Guarantee to or on a separate or
suspense account (with interest accruing thereon at such rate, if any, as
the Security Trustee may deem fit for the account of the relevant Charging
Company) to the credit either of any Charging Company or any of the
Security Beneficiaries selected by the Security Trustee without any
intermediate obligation on the part of the Security Trustee or any of the
Security Beneficiaries to apply the same or any part thereof in or towards
the discharge of the monies due or owing to the Security Trustee or any of
the Security Beneficiaries by the Charging Companies.
10. In the event of the winding up of any of the Charging Companies, the
Security Trustee (on behalf of the Security Beneficiaries) or any of the
Security Beneficiaries themselves may, notwithstanding payment to the
Security Trustee (on behalf of the Security Beneficiaries) or any of the
Security Beneficiaries themselves by any Charging Company or any other
person
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31
of any part of the amount hereby guaranteed or any release, settlement,
discharge or arrangement made or given by the Security Trustee (on behalf
of the Security Beneficiaries) or any of the Security Beneficiaries
themselves, rank as creditor and prove in the liquidation of the relevant
Charging Company for the full amount of the claim of the Security Trustee
(on behalf of the Security Beneficiaries) or any of the Security
Beneficiaries and the Security Trustee (on behalf of the Security
Beneficiaries) or any of the Security Beneficiaries may and shall receive
and retain the whole of the dividends to the exclusion of the rights (if
any) of the Charging Companies or any of them in competition with the
Security Trustee (on behalf of the Security Beneficiaries) or any of the
Security Beneficiaries themselves until such claim is fully satisfied.
10.1 No assurance, security or payment which may be avoided under Sections
238, 239 or 245 of the Insolvency Act 1986 or any of such sections and
no release, settlement, discharge or arrangement which may have been
given or made on the faith of any such assurance security or payment
shall prejudice or affect the right of the Security Trustee (on behalf
of the Security Beneficiaries) or the Security Beneficiaries
themselves to recover from the Charging Companies or any of them to
the full extent of the Guarantee as if such assurance, security,
payment, release, settlement, discharge or arrangement (as the case
may be) had never been granted given or made.
10.2 Any settlement or discharge between a Charging Company and any
Security Beneficiary shall be conditional upon no security or payment
to such Security Beneficiary by that Charging Company or any other
person being avoided or set aside or ordered to be refunded or reduced
by virtue of any provision or enactment relating to bankruptcy,
insolvency or liquidation for the time being in force and accordingly
(but without limiting the other rights of such Security Beneficiary
hereunder), such Security Beneficiary shall be entitled to recover
from that Charging Company the value which such Security Beneficiary
has placed upon such security or the amount of any such payment as if
such settlement or discharge has not occurred.
10.3 Subject to Clause 10.2 upon all the Secured Obligations having been
paid or discharged in full and all the Security Beneficiaries having
ceased to have any further obligations under any Security Documents
whether actual or contingent to make any credit or accommodation to
any Group Company, the Security Trustee will, at the request and cost
of the Charging Companies, immediately execute, reassign and/or do all
such deeds, acts and things as may be reasonably necessary to release
the Charged Property from the security and guarantees created by or
pursuant to this Deed.
10.4 Any release, settlement, discharge or arrangement shall as between the
Security Trustee (on behalf of the Security Beneficiaries) (on the one
hand) and the Charging Companies and each of them (on the other hand)
be deemed to have been given or made upon the express condition that
it shall become and be wholly void and of no effect if the assurance,
security or payment on the faith of which it was made or given shall
at any time thereafter be avoided under any of the before-mentioned
statutory provisions to the intent and so that the Security Trustee
(on behalf of the Security Beneficiaries) shall become and be entitled
at any time after any such avoidance to exercise all or any of the
rights in the Guarantee expressly conferred upon the Security Trustee
(on behalf of the Security Beneficiaries) and all or any other rights
which by virtue and as a consequence of the Guarantee the Security
Trustee (on behalf of the Security Beneficiaries) would have been
entitled to exercise but for such release, settlement, discharge or
arrangement.
10.5 The Charging Companies and each of them agree that such Guarantee
shall be deemed to have been and to have remained held by the Security
Trustee (on behalf of
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the Security Beneficiaries) as and by way of security for the payment
to the Security Trustee (on behalf of the Security Beneficiaries) of
all or any sums which shall or may become due and owing to the
Security Trustee (on behalf of the Security Beneficiaries) from and by
the Charging Companies or any of them either under and by virtue of
the terms and conditions of the Guarantee in the event of and upon or
after any avoidance of any assurance, security or payment under the
said sections of the Insolvency Act 1986 or any of such sections or
under or as a consequence of any Order (if any) made under Sections
238 and/or 239 of the Insolvency Act 1986.
11. Each Charging Company agrees and consents to be bound by the Guarantee
notwithstanding that any other Charging Company which was intended to
execute these presents or any other company which was or is to undertake
liability co-extensive with any liability assumed by a Charging Company
hereunder, may not do so, or that any Charging Company or any other company
may be subsequently released from or found not be bound by the same.
12. As a separate and independent stipulation and without prejudice to anything
else herein, the Charging Companies and each of them agree that all sums of
money which have become due hereunder and which may not be recoverable from
the Charging Companies or any of them on the footing of a guarantee whether
by reason of any legal limitation on or disability or incapacity of any
company or any other fact or circumstance and whether known to the Security
Trustee and/or the Security Beneficiaries or not shall as to an equivalent
amount thereof nevertheless be recoverable from the Charging Company or
Charging Companies concerned as sole or principal debtor or debtors in
respect thereof and shall be paid on demand in writing made by the Security
Trustee and the Charging Companies hereby indemnify the Security Trustee
and the Security Beneficiaries on demand, from and against any loss they
may incur as a result of having now or hereafter made available any monies
to the Charging Companies or having now or hereafter incurred any
obligation on behalf of or at the request of the Charging Companies.
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33
EXECUTED as a DEED (but not )
delivered until the date hereof) by )
DDI EUROPE LIMITED )
acting by:
Director M Malone
Director/Secretary P Glanfield
EXECUTED as a Deed (but not )
delivered until the date hereof) )
by DDI GROUP LIMITED )
acting by: )
Director M Malone
Director/Secretary P Fowler
EXECUTED as a Deed (but not )
delivered until the date hereof) )
by CLASSICAL CIRCUITS LIMITED )
acting by: )
Director M Malone
Director/Secretary P Fowler
EXECUTED as a Deed (but not )
delivered until the date hereof) )
by DDI TECHNOLOGIES LIMITED )
acting by: )
Director M Malone
Director/Secretary P Fowler
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34
EXECUTED as a Deed (but not )
delivered until the date hereof) )
by PRETAN ENGINEERING LIMITED )
acting by: )
Director M Malone
Director/Secretary P Fowler
EXECUTED as a Deed (but not )
delivered until the date hereof) )
by INTEGRATED DESIGNS & SYSTEMS )
LIMITED acting by: )
Director M Malone
Director/Secretary P Fowler
EXECUTED as a Deed (but not )
delivered until the date hereof) )
by DYNAMIC DETAILS LIMITED )
acting by: )
Director M Malone
Director/Secretary P Fowler
EXECUTED as a Deed (but not )
delivered until the date hereof) )
by ZLIN ELECTRONICS LIMITED )
acting by: )
Director M Malone
Director/Secretary P Fowler
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35
EXECUTED as a Deed (but not )
delivered until the date hereof) )
by DDI PRECISION LIMITED acting by: )
)
Director M Malone
Director/Secretary P Fowler
EXECUTED as a Deed (but not )
delivered until the date hereof) )
by DDI INTERNATIONAL LIMITED )
acting by: )
Director M Malone
Director/Secretary P Fowler
EXECUTED as a Deed (but not )
delivered until the date hereof) )
by THOMAS WALTER LIMITED )
acting by: )
Director M Malone
Director/Secretary M Glanfield
EXECUTED as a Deed (but not )
delivered until the date hereof) )
by DDI SALES LIMITED )
acting by: )
Director M Malone
Director/Secretary P Fowler
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36
EXECUTED as a Deed (but not )
delivered until the date hereof) )
by REDLAB LIMITED )
acting by: )
Director M Malone
Director/Secretary M Glanfield
EXECUTED as a Deed (but not )
delivered until the date hereof) )
by KRIZANTEM LIMITED )
acting by: )
Director M Malone
Director/Secretary M Glanfield
EXECUTED as a Deed (but not )
delivered until the date hereof) )
by BWMP (HOLDINGS) LIMITED )
acting by: )
Director M Malone
Director/Secretary M Glanfield
SIGNED as a deed by Andrew Morris )
as duly appointed attorney of )
The Governor and Company of ) A Morris
the Bank of Scotland )
in the presence of: )
Michael I Winning
Victoria Square House
Victoria Square
Birmingham
B2 4DL
Solicitor
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37