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10-Q - 10-Q - PENSKE AUTOMOTIVE GROUP, INC.a15-6891_110q.htm
EX-4.1 - EX-4.1 - PENSKE AUTOMOTIVE GROUP, INC.a15-6891_1ex4d1.htm
EX-10.3 - EX-10.3 - PENSKE AUTOMOTIVE GROUP, INC.a15-6891_1ex10d3.htm
EX-10.1 - EX-10.1 - PENSKE AUTOMOTIVE GROUP, INC.a15-6891_1ex10d1.htm
EX-10.2 - EX-10.2 - PENSKE AUTOMOTIVE GROUP, INC.a15-6891_1ex10d2.htm
EX-31.2 - EX-31.2 - PENSKE AUTOMOTIVE GROUP, INC.a15-6891_1ex31d2.htm
EX-31.1 - EX-31.1 - PENSKE AUTOMOTIVE GROUP, INC.a15-6891_1ex31d1.htm
EX-10.4 - EX-10.4 - PENSKE AUTOMOTIVE GROUP, INC.a15-6891_1ex10d4.htm
EX-12 - EX-12 - PENSKE AUTOMOTIVE GROUP, INC.a15-6891_1ex12.htm
EX-32 - EX-32 - PENSKE AUTOMOTIVE GROUP, INC.a15-6891_1ex32.htm
EXCEL - IDEA: XBRL DOCUMENT - PENSKE AUTOMOTIVE GROUP, INC.Financial_Report.xls

Exhibit 4.2

 

EXECUTION VERSION

 

DATED 2 april 2015

 

(1) UAG UK HOLDINGS LIMITED

(as Parent)

 

(2) SYTNER GROUP LIMITED

(as Company and Original Borrower)

 

(3) THE COMPANIES LISTED IN PART 1 OF SCHEDULE 1 OF THIS AGREEMENT

(as Original Guarantors)

 

(4) THE ROYAL BANK OF SCOTLAND PLC AND BMW FINANCIAL SERVICES (GB) LIMITED

(as Mandated Lead Arranger)

 

(5) THE FINANCIAL INSTITUTIONS LISTED IN PART 2 AND PART 3 OF SCHEDULE 1 OF THIS AGREEMENT

(as Original Lenders)

 

(6) THE ROYAL BANK OF SCOTLAND PLC

(as Agent)

 

(7) THE ROYAL BANK OF SCOTLAND PLC

(as Security Agent)

 


 

£150,000,000 REVOLVING FACILITY AGREEMENT

AS AMENDED AND RESTATED ON 19 DECEMBER 2014 AND

2 APRIL 2015

 


 

GRAPHIC

 



 

CONTENTS

 

Clause

 

 

Page

 

 

 

 

1

DEFINITIONS AND INTERPRETATION

 

1

 

 

 

 

2

THE FACILITY

 

45

 

 

 

 

3

PURPOSE

 

48

 

 

 

 

4

CONDITIONS OF UTILISATION

 

48

 

 

 

 

5

UTILISATION - LOANS

 

49

 

 

 

 

6

ANCILLARY FACILITIES

 

50

 

 

 

 

7

REPAYMENT

 

56

 

 

 

 

8

ILLEGALITY, VOLUNTARY PREPAYMENT AND CANCELLATION

 

57

 

 

 

 

9

MANDATORY PREPAYMENT

 

58

 

 

 

 

10

RESTRICTIONS

 

59

 

 

 

 

11

INTEREST

 

61

 

 

 

 

12

INTEREST PERIODS

 

62

 

 

 

 

13

CHANGES TO THE CALCULATION OF INTEREST

 

62

 

 

 

 

14

FEES

 

64

 

 

 

 

15

TAX GROSS UP AND INDEMNITIES

 

65

 

 

 

 

16

INCREASED COSTS

 

74

 

 

 

 

17

OTHER INDEMNITIES

 

76

 

 

 

 

18

MITIGATION BY THE LENDERS

 

78

 

 

 

 

19

COSTS AND EXPENSES

 

79

 

 

 

 

20

GUARANTEE AND INDEMNITY

 

81

 

 

 

 

21

REPRESENTATIONS

 

85

 

 

 

 

22

INFORMATION UNDERTAKINGS

 

92

 

 

 

 

23

FINANCIAL COVENANTS

 

98

 

 

 

 

24

GENERAL UNDERTAKINGS

 

102

 

 

 

 

25

EVENTS OF DEFAULT

 

112

 

 

 

 

26

CHANGES TO THE LENDERS

 

118

 

 

 

 

27

RESTRICTION ON DEBT PURCHASE TRANSACTIONS

 

123

 

 

 

 

28

CHANGES TO THE OBLIGORS

 

124

 



 

29

ROLE OF THE AGENT, THE ARRANGER AND OTHERS

 

128

 

 

 

 

30

CONDUCT OF BUSINESS BY THE FINANCE PARTIES

 

138

 

 

 

 

31

SHARING AMONG THE FINANCE PARTIES

 

139

 

 

 

 

32

PAYMENT MECHANICS

 

141

 

 

 

 

33

SET-OFF

 

145

 

 

 

 

34

NOTICES

 

145

 

 

 

 

35

CALCULATIONS AND CERTIFICATES

 

148

 

 

 

 

36

PARTIAL INVALIDITY

 

149

 

 

 

 

37

REMEDIES AND WAIVERS

 

149

 

 

 

 

38

AMENDMENTS AND WAIVERS

 

149

 

 

 

 

39

CONFIDENTIALITY

 

153

 

 

 

 

40

COUNTERPARTS

 

157

 

 

 

 

41

GOVERNING LAW

 

158

 

 

 

 

42

ENFORCEMENT

 

158

 

 

 

 

SCHEDULE 1 - THE ORIGINAL PARTIES

 

158

 

 

 

 

 

PART 1 - THE ORIGINAL OBLIGORS

 

159

 

 

 

 

 

PART 2 - THE ORIGINAL LENDERS - OTHER THAN UK NON-BANK LENDERS

 

160

 

 

 

 

 

PART 3 - THE ORIGINAL LENDERS - UK NON-BANK LENDERS

 

161

 

 

 

 

SCHEDULE 2 - CONDITIONS PRECEDENT

 

162

 

 

 

 

 

PART 1 - CONDITIONS PRECEDENT TO SIGNING OF THE AGREEMENT

 

163

 

 

 

 

 

PART 2 - CONDITIONS PRECEDENT REQUIRED TO BE DELIVERED BY AN ADDITIONAL OBLIGOR

 

165

 

 

 

 

SCHEDULE 3 — UTILISATION REQUEST

 

167

 

 

 

 

SCHEDULE 4 - FORM OF TRANSFER CERTIFICATE

 

169

 

 

 

 

SCHEDULE 5 - FORM OF ASSIGNMENT AGREEMENT

 

171

 

 

 

 

SCHEDULE 6 - FORM OF ACCESSION DEED

 

175

 

 

 

 

SCHEDULE 7 - FORM OF RESIGNATION LETTER

 

178

 

 

 

 

SCHEDULE 8 - FORM OF COMPLIANCE CERTIFICATE

 

179

 

 

 

 

SCHEDULE 9 - TIMETABLE

 

182

 

 

 

 

SCHEDULE 10 - AGREED SECURITY PRINCIPLES

 

183

 



 

SCHEDULE 11 - FORM OF INCREASE CONFIRMATION

 

184

 

 

 

 

SCHEDULE 12 - FORMS OF NOTIFIABLE DEBT PURCHASE TRANSACTION NOTICE

 

188

 

 

 

 

 

PART 1 - FORM OF NOTICE ON ENTERING INTO NOTIFIABLE DEBT PURCHASE TRANSACTION

 

188

 

 

 

 

 

PART 2 - FORM OF NOTICE ON TERMINATION OF NOTIFIABLE DEBT PURCHASE TRANSACTION/NOTIFIABLE DEBT PURCHASE TRANSACTION CEASING TO BE WITH SPONSOR AFFILIATE

 

188

 

 

 

 

SCHEDULE 13 - FRANCHISES

 

190

 

 

 

 

Schedule 14- EXISTING SECURITY DOCUMENTS

 

192

 



 

THIS AGREEMENT is made on 16 December 2011 as amended and restated on 19 December 2014 and 2 April 2015

 

BETWEEN:-

 

(1)                                UAG UK HOLDINGS LIMITED (the “Parent”);

 

(2)                                SYTNER GROUP LIMITED (the “Company”);

 

(3)                                 THE SUBSIDIARIES of the Company listed in Part 1 of Schedule 4 (The Original Parties) as original guarantors (together with the Parent and the Company, the “Original Guarantors”);

 

(4)                                 THE ROYAL BANK OF SCOTLAND PLC AND BMW FINANCIAL SERVICES (GB) LIMITED as mandated lead arrangers (whether acting individually or together) (the “Arranger”);

 

(5)                                 THE FINANCIAL INSTITUTIONS listed in Part 2 and Part 3 of Schedule 4 (The Original Parties) as lenders (the “Original Lenders”);

 

(6)                                 THE ROYAL BANK OF SCOTLAND PLC as agent of the other Finance Parties (the “Agent”); and

 

(7)                                THE ROYAL BANK OF SCOTLAND PLC as security trustee for the Secured Parties (the “Security Agent”).

 

IT IS AGREED as follows:-

 

SECTION 1

 

INTERPRETATION

 

10.                                        DEFINITIONS AND INTERPRETATION

 

10.1                                 Definitions

 

In this Agreement:-

 

2012 Amendment Deed

 

means the amendment deed dated 10 January 2012 amending this Agreement

 

 

 

 

Acceptable Bank

 

means:-

 

(a)                                          a bank or financial institution which has a rating for its long-term unsecured and non credit-enhanced debt obligations of A or higher by Standard & Poor’s Rating Services or Fitch Ratings Ltd or A2 or higher by Moody’s Investors Service Limited or a comparable rating from an internationally recognised credit rating agency or

 

(b)                                          The Royal Bank of Scotland plc and National Westminster Bank Plc provided that they have a rating for their long term unsecured and non credit enhanced debt obligations of A- or higher by Standard & Poor’s Rating Services or Fitch Ratings Ltd or A3 or higher by Moody’s Investors Service Limited or a comparable rating from an internationally recognised credit rating agency or

 

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(c)                                  any other bank or financial institution approved by the Agent

 

 

 

Accession Deed

 

means a document substantially in the form set out in Schedule 9 (Form of Accession Deed)

 

 

 

Accounting Principles

 

means generally accepted accounting principles in the United Kingdom, including IFRS

 

 

 

Accounting Reference Date

 

means 31 December

 

 

 

Additional Borrower

 

means a company which becomes an Additional Borrower in accordance with Clause 37 (Changes to the Obligors)

 

 

 

Additional Guarantor

 

means a company which becomes an Additional Guarantor in accordance with Clause 37 (Changes to the Obligors)

 

 

 

Additional Obligor

 

means an Additional Borrower or an Additional Guarantor

 

 

 

Affiliate

 

means, in relation to any person, a Subsidiary of that person or a Holding Company of that person or any other Subsidiary of that Holding Company. Notwithstanding the foregoing, in relation to The Royal Bank of Scotland plc, the term “Affiliate” shall not include (i) the UK government or any member or instrumentality thereof, including Her Majesty’s Treasury and UK Financial Investments Limited (or any directors, officers, employees or entities thereof) or (ii) any persons or entities controlled by or under common control with the UK government or any member or instrumentality thereof (including Her Majesty’s Treasury and UK Financial Investments Limited) and which are not part of The Royal Bank of Scotland Group plc and its subsidiaries or subsidiary undertakings

 

 

 

Agreed Security Principles

 

means the principles set out in Schedule 13 (Agreed Security Principles)

 

 

 

Ancillary Commencement Date

 

means, in relation to an Ancillary Facility, the date on which that Ancillary Facility is first made available, which date shall be a Business Day within the Availability Period for the Facility

 

 

 

Ancillary Commitment

 

means, in relation to an Ancillary Lender and an Ancillary Facility, the maximum amount which that Ancillary Lender has agreed (whether or not subject to satisfaction of conditions precedent) to make available from time to time under an Ancillary Facility and which has been authorised as such under Clause 15 (Ancillary Facilities), to the extent that amount is not cancelled or reduced under this Agreement or the Ancillary Documents relating to that Ancillary Facility

 

 

 

Ancillary Document

 

means each document relating to or evidencing the terms of an Ancillary Facility

 

 

 

Ancillary Facility

 

means any ancillary facility made available by an Ancillary Lender in accordance with Clause 15 (Ancillary Facilities)

 

 

 

Ancillary Lender

 

means each Lender (or Affiliate of a Lender) which makes available an Ancillary Facility in accordance with Clause 15

 

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(Ancillary Facilities)

 

 

 

Ancillary Outstandings

 

means, at any time, in relation to an Ancillary Lender and an Ancillary Facility then in force the aggregate of the following amounts outstanding under that Ancillary Facility:-

 

(a)                                          the principal amount under each overdraft facility and on-demand short term loan facility (net of any Available Credit Balance)

 

(b)                                          the face amount of each guarantee, bond and letter of credit under that Ancillary Facility and

 

(c)                                           the amount fairly representing the aggregate exposure (excluding interest and similar charges) of that Ancillary Lender under each other type of accommodation provided under that Ancillary Facility

 

in each case as determined by such Ancillary Lender, acting reasonably in accordance with its normal banking practice and in accordance with the relevant Ancillary Document

 

 

 

Assignment Agreement

 

means an agreement substantially in the form set out in Schedule 8 (Form of Assignment Agreement) or any other form agreed between the relevant assignor and assignee

 

 

 

Audit Laws

 

means the EU Regulation (537/2014) on specific requirements regarding statutory audit of public-interest entities and repealing Commission Decision 2005/909/EC and the EU Directive (2014/56/EU) amending Directive 2006/43/EC on statutory audits of annual accounts and consolidated accounts and any law or regulation which implements that EU Directive (2014/56/EU)

 

 

 

Authorisation

 

means an authorisation, consent, approval, resolution, licence, exemption, filing, notarisation or registration

 

 

 

Availability Period

 

means from and including the date of this Agreement to and including the date falling one week prior to the Termination Date

 

 

 

Available Commitment

 

means, in relation to the Facility, a Lender’s Commitment minus (subject as set out below):-

 

(a)                                          the amount of its participation in any outstanding Utilisations and the amount of the aggregate of its (and its Affiliate’s) Ancillary Commitments and

 

(b)                                          in relation to any proposed Utilisation, the amount of its participation in any other Utilisations that are due to be made under the Facility on or before the proposed Utilisation Date and the amount of its (and its Affiliate’s) Ancillary Commitment in relation to any new Ancillary Facility that is due to be made available on or before the proposed Utilisation Date

 

For the purposes of calculating that Lender’s Available Commitment in relation to any proposed Utilisation the following amounts shall not be deducted from that Lender’s

 

3



 

 

 

Commitment:-

 

(i)                                             that Lender’s participation in any Utilisations that are due to be repaid or prepaid on or before the proposed Utilisation Date and

 

(ii)                                          that Lender’s (and its Affiliate’s) Ancillary Commitments to the extent that they are due to be reduced or cancelled on or before the proposed Utilisation Date

 

 

 

Available Credit Balance

 

means, in relation to an Ancillary Facility, credit balances on any account of any Borrower of that Ancillary Facility with the Ancillary Lender making available that Ancillary Facility to the extent that those credit balances are freely available to be set off by that Ancillary Lender against liabilities owed to it by that Borrower under that Ancillary Facility

 

 

 

Available Facility

 

means the aggregate for the time being of each Lender’s Available Commitment

 

 

 

Base Reference Bank Rate

 

means the arithmetic mean of the rates (rounded upwards to four decimal places) as supplied to the Agent at its request by the Base Reference Banks in relation to LIBOR

 

(a)                                        (other than where paragraph (b) below applies) as the rate at which the relevant Base Reference Bank could borrow funds in the London interbank market in the relevant currency and for the relevant period were it to do so by asking for and then accepting interbank offers for deposits in reasonable market size in that currency and for that period or

 

(b)                                        if different, as the rate (if any and applied to the relevant Base Reference Bank and the relevant currency and period) which contributors to the applicable Screen Rate are asked to submit to the relevant administrator

 

 

 

Base Reference Banks

 

means the principal London offices of two or more banks or financial institutions as may be appointed by the Agent in consultation with the Company, save that no Lender shall be appointed as a Base Reference Bank without its prior written consent

 

 

 

Bilateral Overdraft Lender

 

means The Royal Bank of Scotland plc as agent for National Westminster Bank Plc in its capacity as lender under the NatWest Overdraft Letter

 

 

 

Borrower

 

means the Company or an Additional Borrower unless it has ceased to be a Borrower in accordance with Clause 37 (Changes to the Obligors) and, in respect of an Ancillary Facility only, any Affiliate of a Borrower that becomes a borrower of that Ancillary Facility with the approval of the relevant Lender pursuant to Clause 15.9 (Affiliates of Borrowers)

 

 

 

Borrowings

 

has the meaning given to that term in Clause 32.1 (Financial

 

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 definitions)

 

 

 

Break Costs

 

means the amount (if any) by which:-

 

(a)                                          the interest (excluding the Margin) which a Lender should have received for the period from the date of receipt of all or any part of its participation in a Loan or Unpaid Sum to the last day of the current Interest Period in respect of that Loan or Unpaid Sum, had the principal amount or Unpaid Sum received been paid on the last day of that Interest Period

 

exceeds:-

 

(b)                                          the amount which that Lender would be able to obtain by placing an amount equal to the principal amount or Unpaid Sum received by it on deposit with a leading bank for a period starting on the Business Day following receipt or recovery and ending on the last day of the current Interest Period

 

 

 

Budget

 

means:-

 

(a)                                          in relation to the period beginning on 1 January 2011 and ending on 31 December 2011, the budget delivered by the Company to the Lenders prior to the date of this Agreement and

 

(b)                                          in relation to any other period, any budget delivered by the Company to the Agent in respect of that period pursuant to Clause 31.4 (Budget)

 

 

 

Business Day

 

means a day (other than a Saturday or Sunday) on which banks are open for general business in London

 

 

 

Capital Expenditure

 

has the meaning given to that term in Clause 32.1 (Financial definitions)

 

 

 

Cash

 

means, at any time, cash denominated in Sterling in hand or at bank and (in the latter case) credited to an account in the name of an Obligor with an Acceptable Bank and to which an Obligor is alone (or together with other Obligors) beneficially entitled and for so long as:-

 

(a)                                          that cash is repayable within 30 days after the relevant date of calculation

 

(b)                                          repayment of that cash is not contingent on the prior discharge of any other indebtedness of any member of the Group or of any other person whatsoever or on the satisfaction of any other condition

 

(c)                                           there is no Security over that cash except for Transaction Security or any Permitted Security constituted by a netting or set-off arrangement entered into by members of the Group in the ordinary course of their banking arrangements and

 

5



 

 

 

(d)                                          the cash is freely and immediately available to be applied in repayment or prepayment of the Facility

 

 

 

Cash Equivalent Investments

 

means at any time:-

 

(a)                                          certificates of deposit maturing within one year after the relevant date of calculation and issued by an Acceptable Bank

 

(b)                                          any investment in marketable debt obligations issued or guaranteed by the government of the United States of America, the United Kingdom, any member state of the European Economic Area or any Participating Member State or by an instrumentality or agency of any of them having an equivalent credit rating, maturing within one year after the relevant date of calculation and not convertible or exchangeable to any other security

 

(c)                                           commercial paper not convertible or exchangeable to any other security:-

 

(i)                                             for which a recognised trading market exists

 

(ii)                                          issued by an issuer incorporated in the United States of America, the United Kingdom, any member state of the European Economic Area or any Participating Member State

 

(iii)                                       which matures within one year after the relevant date of calculation and

 

(iv)                                      which has a credit rating of either A-1 or higher by Standard & Poor’s Rating Services or F1 or higher by Fitch Ratings Ltd or P-1 or higher by Moody’s Investors Service Limited, or, if no rating is available in respect of the commercial paper, the issuer of which has, in respect of its long-term unsecured and non-credit enhanced debt obligations, an equivalent rating

 

(d)                                          sterling bills of exchange eligible for rediscount at the Bank of England and accepted by an Acceptable Bank (or their dematerialised equivalent)

 

(e)                                           any investment in money market funds which (i) have a credit rating of either A-1 or higher by Standard & Poor’s Rating Services or F1 or higher by Fitch Ratings Ltd or P-1 or higher by Moody’s Investors Service Limited, (ii) which invest substantially all their assets in securities of the types described in sub-clauses (a) to (d) above and (iii) can be turned into cash on not more than 30 days’ notice or

 

6



 

 

 

(f)                                   any other debt security approved by the Majority Lenders,

 

in each case, denominated in Sterling and to which any Obligor is alone (or together with other Obligors beneficially entitled at that time and which is not issued or guaranteed by any member of the Group or subject to any Security (other than Security arising under the Transaction Security Documents)

 

 

 

Cashflow

 

has the meaning given to that term in Clause 32.1 (Financial definitions)

 

7



 

Change of Control

 

means PAG ceases to control directly or indirectly the Company and/or any person or group of persons acting in concert gains direct or indirect control of the Company. For the purposes of this definition:-

 

(a)                                 control” of the Company means:-

 

(i)                                     the power (whether by way of ownership of shares, proxy, contract, agency or otherwise) to:-

 

(A)                               cast, or control the casting of, 51% or more of the maximum number of votes that might be cast at a general meeting of the Company or

 

(B)                               appoint or remove all, or the majority, of the directors or other equivalent officers of the Company or

 

(C)                               give directions with respect to the operating and financial policies of the Company with which the directors or other equivalent officers of the Company are obliged to comply and/or

 

(ii)                                  the holding beneficially of 51% of the issued share capital of the Company (excluding any part of that issued share capital that carries no right to participate beyond a specified amount in a distribution of either profits or capital)

 

(b)                                 acting in concert” means, a group of persons who, pursuant to an agreement or understanding (whether formal or informal), actively co-operate, through the acquisition directly or indirectly of shares in the Company by any of them, either directly or indirectly, to obtain or consolidate control of the Company

 

 

 

Charged Property

 

means all of the assets of the Obligors which from time to time are, or are expressed to be, the subject of the Transaction Security

 

 

 

Closing Date

 

means the date on which the Agent confirms to the Company in writing that all of the conditions precedent in Part 1 of Schedule 5 have been satisfied or waived

 

 

 

Code

 

means the US Internal Revenue Code of 1986

 

 

 

Commitment

 

means:-

 

(a)                                 in relation to an Original Lender, the amount set

 

8



 

 

 

opposite its name under the heading “Commitment” in Part 2 or Part 3 of Schedule 4 (The Original Parties) and the amount of any other Commitment transferred to it under this Agreement or assumed by it in accordance with Clause 11.2 (Increase) and

 

(b)                                 in relation to any other Lender, the amount of any Commitment transferred to it under this Agreement or assumed by it in accordance with Clause 11.2 (Increase)

 

to the extent:-

 

(i)                                     not cancelled, reduced or transferred by it under this Agreement and

 

(ii)                                  not deemed to be zero pursuant to Clause 36.2 (Disenfranchisement on Debt Purchase Transactions entered into by Sponsor Affiliates)

 

 

 

Company’s Auditors

 

means KPMG LLP or any other firm appointed by the Company to act as its statutory auditors

 

 

 

Compliance Certificate

 

means a certificate substantially in the form set out in Schedule 11 (Form of Compliance Certificate)

 

 

 

Confidential Information

 

means all information relating to the Parent, the Company, any Obligor, the Group, the Finance Documents or the Facility of which a Finance Party becomes aware in its capacity as, or for the purpose of becoming, a Finance Party or which is received by a Finance Party in relation to, or for the purpose of becoming a Finance Party under, the Finance Documents or the Facility from either:-

 

(a)                                 the Parent or any member of the Group or any of its advisers or

 

(b)                                 another Finance Party, if the information was obtained by that Finance Party directly or indirectly from the Parent or any member of the Group or any of its advisers

 

in whatever form, and includes information given orally and any document, electronic file or any other way of representing or recording information which contains or is derived or copied from such information but excludes information that:-

 

(i)                                     is or becomes public information other than as a direct or indirect result of any breach by that Finance Party of Clause 48 (Confidentiality) or

 

(ii)                                  is identified in writing at the time of delivery as non-confidential by the Parent or any member of the Group or any of its advisers

 

9



 

 

 

or

 

(iii)                               is known by that Finance Party before the date the information is disclosed to it in accordance with sub-clauses (a) or (b) above or is lawfully obtained by that Finance Party after that date, from a source which is, as far as that Finance Party is aware, unconnected with the Parent or the Group and which, in either case, as far as that Finance Party is aware, has not been obtained in breach of, and is not otherwise subject to, any obligation of confidentiality

 

 

 

Confidentiality Undertaking

 

means a confidentiality undertaking substantially in a recommended form of the LMA or in any other form agreed between the Company and the Agent

 

 

 

Contribution Notice

 

means a contribution notice issued by the Pensions Regulator under section 38 or section 47 of the Pensions Act 2004

 

 

 

CTA

 

means the Corporation Tax Act 2009

 

 

 

DB Schemes

 

means:-

 

(a)                                 the Ryland Group Pension Scheme established by an interim deed dated 29 January 1974

 

(b)                                 the William Jacks PLC Retirement Benefits Scheme established by interim trust deed dated 1 November 1953

 

(c)                                  the industry-wide MIP Plan and

 

(d)                                 the Isaac Agnew (Holdings) Limited Management Pension Plan established by trust deed dated 25 March 1984

 

 

 

Debt Purchase Transaction

 

means, in relation to a person, a transaction where such person:-

 

(a)                                 purchases by way of assignment or transfer

 

(b)                                 enters into any sub-participation in respect of or

 

(c)                                  enters into any other agreement or arrangement having an economic effect substantially similar to a sub-participation in respect of

 

the Commitment or amount outstanding under this Agreement

 

 

 

Default

 

means an Event of Default or any event or circumstance specified in Clause 34 (Events of Default) which would (with the expiry of a grace period, the giving of notice, the making of any determination under the Finance Documents or any

 

10



 

 

 

combination of any of the foregoing) be an Event of Default

 

 

 

Defaulting Lender

 

means any Lender (other than a Lender which is a Sponsor Affiliate):-

 

(a)                                 which has failed to make its participation in a Loan available (or has notified the Agent or the Parent (which has notified the Agent) that it will not make its participation in a Loan available) by the Utilisation Date of that Loan in accordance with Clause 14.4 (Lenders’ participation)

 

(b)                                 which has otherwise rescinded or repudiated a Finance Document or

 

(c)                                  with respect to which an Insolvency Event has occurred and is continuing

 

unless, in the case of paragraph (a) above:-

 

(i)                                     its failure to pay is caused by:-

 

(A)                               administrative or technical error or

 

(B)                               a Disruption Event and

 

payment is made within 3 Business Days of its due date or

 

(ii)                                  the Lender is disputing in good faith whether it is contractually obliged to make the payment in question

 

 

 

Delegate

 

means any delegate, agent, attorney or co-trustee appointed by the Security Agent

 

 

 

Designated Gross Amount

 

means the amount notified by the Parent to the Agent upon the establishment of a Multi-account Overdraft as being the maximum amount of Gross Outstandings that will, at any time, be outstanding under that Multi-account Overdraft

 

 

 

Designated Net Amount

 

means the amount notified by the Parent to the Agent upon the establishment of a Multi-account Overdraft as being the maximum amount of Net Outstandings that will, at any time, be outstanding under that Multi-account Overdraft

 

11



 

Disruption Event

 

means either or both of:-

 

(a)                                 a material disruption to those payment or communications systems or to those financial markets which are, in each case, required to operate in order for payments to be made in connection with the Facility (or otherwise in order for the transactions contemplated by the Finance Documents to be carried out) which disruption is not caused by, and is beyond the control of, any of the Parties or

 

(b)                                 the occurrence of any other event which results in a disruption (of a technical or systems-related nature) to the treasury or payments operations of a Party preventing that, or any other Party:-

 

(i)                                     from performing its payment obligations under the Finance Documents or

 

(ii)                                  from communicating with other Parties in accordance with the terms of the Finance Documents

 

and which (in either such case) is not caused by, and is beyond the control of, the Party whose operations are disrupted

 

 

 

Dormant Subsidiary

 

means a member of the Group which does not trade (for itself or as agent for any person) and does not own, legally or beneficially, assets (including, without limitation, indebtedness owed to it) which in aggregate have a value of £5,000 or more or its equivalent in other currencies

 

 

 

Environment

 

means humans, animals, plants and all other living organisms including the ecological systems of which they form part and the following media:-

 

(a)                                 air (including, without limitation, air within natural or man-made structures, whether above or below ground)

 

(b)                                 water (including, without limitation, territorial, coastal and inland waters, water under or within land and water in drains and sewers) and

 

(c)                                  land (including, without limitation, land under water)

 

 

 

Environmental Claim

 

means any claim, proceeding, formal notice or investigation by any person in respect of any Environmental Law

 

 

 

Environmental Law

 

means any applicable law or regulation which relates to:-

 

(a)                                 the pollution or protection of the Environment

 

12



 

 

 

(b)                                 the conditions of the workplace or

 

(c)                                  the generation, handling, storage, use, release or spillage of any substance which, alone or in combination with any other, is capable of causing harm to the Environment, including, without limitation, any waste

 

 

 

Environmental Permits

 

means any permit and other Authorisation and the filing of any notification, report or assessment required under any Environmental Law for the operation of the business of any member of the Group conducted on or from the properties owned or used by any member of the Group

 

 

 

Event of Default

 

means any event or circumstance specified as such in Clause 34 (Events of Default)

 

 

 

Existing Security Documents

 

means those security documents granted before the Second Amendment and Restatement Date listed in Schedule 17 (Existing Security Documents)

 

 

 

Facility

 

means the revolving credit facility made available under this Agreement as described in Clause 11.1.1

 

 

 

Facility Office

 

means:-

 

(a)                                 in respect of a Lender, the office or offices notified by that Lender to the Agent in writing on or before the date it becomes a Lender (or, following that date, by not less than five Business Days’ written notice) as the office or offices through which it will perform its obligations under this Agreement or

 

(b)                                 in respect of any other Finance Party, the office in the jurisdiction in which it is resident for tax purposes

 

 

 

FATCA

 

 

 

means:

 

(a)                                 sections 1471 to 1474 of the Code or any associated regulations

 

(b)                                 any treaty, law or regulation of any other jurisdiction, or relating to an intergovernmental agreement between the US and any other jurisdiction, which (in either case) facilitates the implementation of any law or regulation referred to in paragraph (a) above or

 

(c)                                  any agreement pursuant to the implementation of any treaty, law or regulation referred to in paragraphs (a) or (b) above with the US Internal Revenue Service, the US government or any governmental or taxation authority in any other jurisdiction

 

 

 

FATCA Application

 

means:

 

13



 

Date

 

(a)                                 in relation to a “withholdable payment” described in section 1473(1)(A)(i) of the Code (which relates to payments of interest and certain other payments from sources within the US), 1 July 2014

 

(b)                                 in relation to a “withholdable payment” described in section 1473(1)(A)(ii) of the Code (which relates to “gross proceeds” from the disposition of property of a type that can produce interest from sources within the US), 1 January 2017 or

 

(c)                                  in relation to a “passthru payment” described in section 1471(d)(7) of the Code not falling within paragraphs (a) or (b) above, 1 January 2017,

 

or, in each case, such other date from which such payment may become subject to a deduction or withholding required by FATCA as a result of any change in FATCA after the First Amendment and Restatement Date.

 

 

 

FATCA Deduction

 

means a deduction or withholding from a payment under a Finance Document required by FATCA

 

 

 

FATCA Exempt Party

 

means a Party that is entitled to receive payments free from any FATCA Deduction

 

 

 

Fee Letter

 

means:-

 

(a)                                 any letter or letters dated on or about the date of this Agreement between the Agent and the Company or the Security Agent and the Company setting out any of the fees referred to in Clause 23 (Fees) and

 

(b)                                 any agreement setting out fees payable to a Finance Party referred to in Clause 11.2.5, Clause 23.5 (Interest, commission and fees on Ancillary Facilities) of this Agreement or under any other Finance Document

 

 

 

Finance Document

 

means this Agreement, any Accession Deed, any Ancillary Document, any Compliance Certificate, any Fee Letter, any Hedging Agreement, the Intercreditor Agreement, any Resignation Letter, any Transaction Security Document, any Utilisation Request, the Vehicle Financier Deeds of Priority, the 2012 Amendment Deed, the First Amendment and Restatement Agreement, the Second Amendment and Restatement Agreement and any other document designated as a “Finance Document” by the Agent and the Company provided that where the term “Finance Document” is used in, and construed for the purposes of, this Agreement or the Intercreditor Agreement, a Hedging Agreement shall be a Finance Document only for the purposes of:-

 

(a)                                 the definition of “Material Adverse Effect”

 

(b)                                 sub-clause (a) of the definition of “Permitted

 

14



 

 

 

Transaction”

 

(c)                                  the definition of “Transaction Security Document”

 

(d)                                 Clause 10.2.1(d)

 

(e)                                  Clause 29 (Guarantee and Indemnity) and

 

(f)                                   Clause 34 (Events of Default) (other than Clause 34.13.2 and Clause 34.18 (Acceleration))

 

 

 

Finance Party

 

means the Agent, the Arranger, the Security Agent, a Lender, a Hedge Counterparty or any Ancillary Lender provided that where the term “Finance Party” is used in, and construed for the purposes of, this Agreement or the Intercreditor Agreement, a Hedge Counterparty shall be a Finance Party only for the purposes of:-

 

(a)                                 the definition of “Secured Parties”

 

(b)                                 Clause 10.2.1(a)

 

(c)                                  sub-clause (c) of the definition of Material Adverse Effect

 

(d)                                 Clause 29 (Guarantee and Indemnity) and

 

(e)                                  Clause 39 (Conduct of business by the Finance Parties)

 

 

 

Financial Event of Default

 

means an Event of Default arising under any of Clauses 34.1 (Non payment), 34.2 (Other obligations) (to the extent that such Event of Default arises as a breach of Clause 32 (Financial covenants) or Clause 31 (Information Undertakings) (in relation to the delivery of Annual Financial Statements, Quarterly Financial Statements, Monthly Financial Statements and/or Compliance Certificates)), 34.5 (Cross-default), 34.6 (Insolvency), 34.7 (Insolvency proceedings) and 34.8 (Creditor’s process)

 

 

 

Financial Indebtedness

 

means any indebtedness for or in respect of:-

 

(a)                                 moneys borrowed and debit balances at banks or other financial institutions

 

(b)                                 any acceptance under any acceptance credit or bill discounting facility (or dematerialised equivalent)

 

(c)                                  any note purchase facility or the issue of bonds, notes, debentures, loan stock or any similar instrument

 

(d)                                 the amount of any liability in respect of Finance Leases

 

(e)                                  receivables sold or discounted (other than any

 

 

15



 

 

 

 receivables to the extent they are sold on a non-recourse basis and meet any requirement for de-recognition under the Accounting Principles)

 

 

 

 

 

 

(f)                                   any Treasury Transaction (and, when calculating the value of that Treasury Transaction, only the marked to market value (or, if any actual amount is due as a result of the termination or close-out of that Treasury Transaction, that amount) shall be taken into account)

 

(g)                                  any counter-indemnity obligation in respect of a guarantee, bond, standby or documentary letter of credit or any other instrument issued by a bank or financial institution in respect of (i) an underlying liability of an entity which is not a member of the Group which liability would fall within one of the other sub-clauses of this definition or (ii) any liabilities of any member of the Group relating to any post-retirement benefit scheme

 

(h)                                 any amount raised by the issue of redeemable shares which are redeemable (other than at the option of the issuer) before the Termination Date or are otherwise classified as borrowings under the Accounting Principles)

 

(i)                                     any amount of any liability under an advance or deferred purchase agreement if (i) one of the primary reasons behind entering into the agreement is to raise finance or to finance the acquisition or construction of the asset or service in question or (ii) the agreement is in respect of the supply of assets or services and payment is due more than 90 days after the date of supply

 

(j)                                    any amount raised under any other transaction (including any forward sale or purchase, sale and sale back or sale and leaseback agreement) having the commercial effect of a borrowing or otherwise classified as borrowings under the Accounting Principles and

 

(k)                                 the amount of any liability in respect of any guarantee or indemnity for any of the items referred to in sub-clauses (a) to (j) above

 

 

 

Financial Quarter

 

has the meaning given to that term in Clause 32.1 (Financial definitions)

 

 

 

Financial Support Direction

 

means a financial support direction issued by the Pensions Regulator under section 43 of the Pensions Act 2004

 

 

 

Financial Year

 

has the meaning given to that term in Clause 32.1 (Financial definitions)

 

 

 

First Amendment and

 

means the agreement amending and restating this Agreement

 

16



 

Restatement Agreement

 

entered into between Parties on the First Amendment and Restatement Date

 

 

 

First Amendment and Restatement Date

 

means 19 December 2014

 

 

 

Franchises

 

means the franchises, vehicle distribution agreements and dealerships listed in Schedule 16 (Franchises)

 

 

 

German Group

 

means PAE GmbH and each of its Subsidiaries from time to time

 

 

 

Gross Outstandings

 

means, in relation to a Multi-account Overdraft, the Ancillary Outstandings of that Multi-account Overdraft but calculated on the basis that the words “(net of any Available Credit Balance)” in paragraph (a) of the definition of “Ancillary Outstandings” were deleted

 

 

 

Group

 

means the Company and each of its Subsidiaries for the time being

 

 

 

Group Structure Chart

 

means the group structure chart in the agreed form

 

 

 

Guarantor

 

means an Original Guarantor or an Additional Guarantor, unless it has ceased to be a Guarantor in accordance with Clause 37 (Changes to the Obligors)

 

 

 

Hedge Counterparty

 

means any entity which has become a Party as a Hedge Counterparty in accordance with Clause 35.8 (Accession of Hedge Counterparties) and which has become a party to the Intercreditor Agreement as a Hedge Counterparty in accordance with the provisions of the Intercreditor Agreement

 

 

 

Hedging Agreement

 

means any master agreement, confirmation, schedule or other agreement entered into or to be entered into by an Obligor and a Hedge Counterparty for the purpose of hedging the types of liabilities and/or risks in relation to the Facility which, at the time that that master agreement, confirmation, schedule or other agreement (as the case may be) is entered into are permitted to be entered into pursuant to the terms of this Agreement

 

 

 

Holding Company

 

means, in relation to a person, any other person in respect of which it is a Subsidiary

 

 

 

IFRS

 

means international accounting standards within the meaning of IAS Regulation 1606/2002 to the extent applicable to the relevant financial statements

 

 

 

Impaired Agent

 

means the Agent at any time when:-

 

(a)                                 it has failed to make (or has notified a Party that it will not make) a payment required to be made by it under the Finance Documents by the due date for

 

17



 

 

 

payment

 

(b)                                 the Agent otherwise rescinds or repudiates a Finance Document

 

(c)                                  (if the Agent is also a Lender) it is a Defaulting Lender under paragraph (a) or (b) of the definition of “Defaulting Lender” or

 

(d)                                 an Insolvency Event has occurred and is continuing with respect to the Agent

 

unless, in the case of paragraph (a) above:-

 

(i)                                     its failure to pay is caused by:-

 

(A)                               administrative or technical error or

 

(B)                               a Disruption Event and

 

payment is made within 3 Business Days of its due date or

 

(ii)                                  the Agent is disputing in good faith whether it is contractually obliged to make the payment in question

 

 

 

Increase Confirmation

 

means a confirmation substantially in the form set out in Schedule 14 (Form of Increase Confirmation)

 

 

 

Increase Lender

 

has the meaning given to that term in Clause 11.2 (Increase)

 

 

 

Insolvency Event

 

in relation to an entity means that the entity:-

 

(a)                                 is dissolved (other than pursuant to a consolidation, amalgamation or merger)

 

(b)                                 becomes insolvent

 

(c)                                  has a resolution passed for its winding-up or liquidation (other than pursuant to a consolidation, amalgamation or merger)

 

(d)                                 seeks or becomes subject to the appointment of an administrator, liquidator, receiver, trustee, custodian or other similar official for it or for all or substantially all its assets

 

(e)                                  has a secured party take possession of all or substantially all its assets or has a distress, execution, attachment, sequestration or other legal process levied, enforced or sued on or against all or substantially all its assets and such secured party maintains possession, or any such process is not dismissed, discharged, stayed or restrained, in

 

18



 

 

 

each case within 30 days thereafter

 

(f)                                   causes or is subject to any event with respect to it which, under the applicable laws of any jurisdiction, has an analogous effect to any of the events specified in paragraphs (a) to (e) above or

 

(g)                                  takes any action in furtherance of, or indicating its consent to, approval of, or acquiescence in, any of the foregoing acts

 

 

 

Intellectual Property

 

means:-

 

(a)                                 any material patents, trade marks, service marks, designs, business names, copyrights, database rights, design rights, domain names, moral rights, inventions, confidential information, knowhow and other intellectual property rights and interests (which may now or in the future subsist), whether registered or unregistered and

 

(b)                                 the benefit of all applications and rights to use such assets of each member of the Group (which may now or in the future subsist)

 

 

 

Intercreditor Agreement

 

means the intercreditor agreement dated the same date as this Agreement and made between, among others, the Parent, the Company, the other Obligors, The Royal Bank of Scotland plc as Security Agent, The Royal Bank of Scotland plc as agent, the Lenders, the Arranger, the Ancillary Lenders, the Hedge Counterparties and the Bilateral Overdraft Lender

 

 

 

Interest Period

 

means, in relation to a Loan, each period determined in accordance with Clause 21 (Interest Periods) and, in relation to an Unpaid Sum, each period determined in accordance with Clause 20.3 (Default interest)

 

 

 

Interpolated Screen Rate

 

means, in relation to LIBOR for any Loan, the rate (rounded to the same number of decimal places as the two relevant Screen Rates) which results from interpolating on a linear basis between:

 

(a)                                 the applicable Screen Rate for the longest period (for which that Screen Rate is available) which is less than the Interest Period of that Loan; and

 

(b)                                 the applicable Screen Rate for the shortest period (for which that Screen Rate is available) which exceeds the Interest Period of that Loan,

 

each as of the Specified Time on the Quotation Day for the currency of that Loan.

 

 

 

ITA

 

means the Income Tax Act 2007

 

19



 

Joint Venture

 

means any joint venture entity, whether a company, unincorporated firm, undertaking, association, joint venture or partnership or any other entity

 

 

 

Legal Opinion

 

means any legal opinion delivered to the Agent under Clause 13.1 (Initial conditions precedent) or Clause 37 (Changes to the Obligors)

 

 

 

Legal Reservations

 

means:-

 

(a)                                 the principle that equitable remedies may be granted or refused at the discretion of a court and the limitation of enforcement by laws relating to insolvency, reorganisation and other laws generally affecting the rights of creditors

 

(b)                                 the time barring of claims under the Limitation Acts, the possibility that an undertaking to assume liability for or indemnify a person against non-payment of UK stamp duty may be void and defences of set-off or counterclaim

 

(c)                                  the principle that in certain circumstances Security granted by way of fixed charge may be characterised as a floating charge or that Security purported to be constituted by way of an assignment may be recharacterised as a charge

 

(d)                                 the principle that any additional interest imposed pursuant to any relevant agreement may be held to be unenforceable on the grounds that it is a penalty and thus void

 

(e)                                  the principle that an English court or a court of Northern Ireland may not give effect to an indemnity for legal costs incurred by an unsuccessful litigant

 

(f)                                   similar principles, rights and defences under the laws of any Relevant Jurisdiction and

 

(g)                                  any other matters which are set out as qualifications or reservations as to matters of law of general application in the Legal Opinions

 

 

 

Lender

 

means:-

 

(a)                                 any Original Lender and

 

(b)                                 any bank, financial institution, trust, fund or other entity which has become a Party as a Lender in accordance with Clause 11.2 (Increase) or Clause 35 (Changes to the Lenders)

 

which in each case has not ceased to be a Lender in

 

20



 

 

 

accordance with the terms of this Agreement

 

 

 

LIBOR

 

means, in relation to any Loan:

 

(a)                                 the applicable Screen Rate;

 

(b)                                 (if no Screen Rate is available for the currency or Interest Period of that Loan) the Interpolated Screen Rate for that Loan; or

 

(c)                                  if:

 

(i)                                     no Screen Rate is available for the currency of that Loan; or

 

(ii)                                  no Screen Rate is available for the Interest Period of that Loan and it is not possible to calculate an Interpolated Screen Rate for that Loan,

 

the Base Reference Bank Rate, as of, in the case of paragraphs (a) and (c) above, the Specified Time on the Quotation Day for the currency of that Loan and for a period equal in length to the Interest Period of that Loan

 

 

 

Limitation Acts

 

means the Limitation Act 1980 and the Foreign Limitation Periods Act 1984

 

 

 

LMA

 

means the Loan Market Association

 

 

 

Loan

 

means a loan made or to be made under the Facility or the principal amount outstanding for the time being of that loan

 

 

 

Majority Lenders

 

means:-

 

(a)                                 subject to paragraph (b) below, a Lender or Lenders whose Commitments aggregate more than 662/3 per cent of the Total Commitments (or, if the Total Commitments have been reduced to zero, aggregated more than 662/3 per cent of the Total Commitments immediately prior to that reduction)

 

(b)                                 for the purposes of Clause 34.18 (Acceleration) where an Event of Default has occurred and is continuing under any of Clauses 34.1 (Non-payment), 34.2 (Financial covenants and other obligations) (where such Event of Default arises from a breach of Clause 32 (Financial covenants)), 34.5 (Cross default), 34.6 (Insolvency), 34.7 (Insolvency proceedings), 34.8 (Creditors’ process), a Lender or Lenders whose Commitments aggregate 50 per cent or more of the Total Commitments (or, if the Total Commitments

 

21



 

 

 

have been reduced to zero, aggregated 50 per cent or more of the Total Commitments immediately prior to that reduction)

 

 

 

Margin

 

means:-

 

(a)                                 in relation to any Loan, 3 per cent per annum

 

(b)                                 in relation to any Unpaid Sum relating or referable to the Facility, the rate per annum specified above and

 

(c)                                  in relation to any other Unpaid Sum, the highest rate specified above

 

but if:-

 

(d)                                 no Event of Default has occurred and is continuing

 

(e)                                  the ratio of Consolidated Net Borrowings to Consolidated EBITDA in respect of the most recently completed Relevant Period is within a range set out below,

 

then the Margin for each Loan will be the percentage per annum set out below in the column opposite that range:-

 

 

 

 

 

Consolidated Net Borrowings: Consolidated
EBITDA

 

Margin % pa

 

 

 

 

 

 

 

Greater than 2.5:1

 

3.00

 

 

 

 

 

 

 

Greater than 2.0:1 but less than or equal to 2.5:1

 

2.50

 

 

 

 

 

 

 

Greater than 1.5:1 but less than or equal to 2.0:1

 

1.90

 

 

 

 

 

 

 

Greater than 1.0:1 but less than or equal to 1.5:1

 

1.70

 

 

 

 

 

 

 

Greater than 0.7:1 but less than or equal to 1.0:1

 

1.50

 

 

 

 

 

 

 

Less than or equal to 0.7:1

 

1.35

 

 

 

 

 

 

 

However:-

 

(i)                                     any increase or decrease in the Margin for a Loan shall take effect on the date (the “reset date”) which is three Business Days following receipt by the Agent of the Compliance Certificate for that Relevant Period pursuant to Clause 31.2 (Provision and contents of Compliance Certificate)

 

22



 

 

 

(ii)                                  if, following receipt by the Agent of the annual audited financial statements of the Group and related Compliance Certificate, those statements and Compliance Certificate do not confirm the basis for a reduced Margin, then the provisions of Clause 20.2 (Payment of interest) shall apply and the Margin for that Loan shall be the percentage per annum determined using the table above and the revised ratio of Consolidated Net Borrowings to Consolidated EBITDA calculated using the figures in that Compliance Certificate

 

(iii)                               while an Event of Default is continuing, the Margin for each Loan shall be the highest percentage per annum set out above and

 

for the purpose of determining the Margin, Consolidated Net Borrowings, Consolidated EBITDA and Relevant Period shall be determined in accordance with Clause 32.1 (Financial definitions)

 

 

 

Material Adverse Effect

 

means a material adverse effect on:-

 

(a)                                 the business or financial condition of the Group taken as a whole or

 

(b)                                 the ability of an Obligor to perform its obligations under the Finance Documents or

 

(c)                                  the validity or enforceability of any Finance Document

 

 

 

Material Company

 

means, at any time:-

 

(a)                                 an Obligor or

 

(b)                                 a wholly-owned member of the Group that holds shares in an Obligor or

 

(c)                                  a Subsidiary of the Company which has earnings before interest, tax, depreciation and amortisation calculated on the same basis as Consolidated EBITDA (as defined in Clause 32.1 (Financial definitions) (but on an unconsolidated basis)) representing 10 per cent. or more of Consolidated EBITDA (as defined in Clause 32.1 (Financial definitions)) or has gross assets, net assets or turnover (excluding intra-group items) representing 10 per cent. or more of the gross assets, net assets or turnover of the Group, calculated on a consolidated basis

 

Compliance with the condition set out in sub-clause (c) shall be determined by reference to the most recent Compliance Certificate supplied by the Company and/or the latest audited

 

23



 

 

 

financial statements of that Subsidiary (consolidated in the case of a Subsidiary which itself has Subsidiaries) and the latest audited consolidated financial statements of the Group. However, if a Subsidiary has been acquired since the date as at which the latest audited consolidated financial statements of the Group were prepared, the financial statements shall be deemed to be adjusted in order to take into account the acquisition of that Subsidiary (that adjustment being certified by two directors of the Company as representing an accurate reflection of the revised Consolidated EBITDA (as defined in Clause 32.1 (Financial definitions)), gross assets, net assets or turnover of the Group).

 

A report by the Company’s Auditors that a Subsidiary is or is not a Material Company shall, in the absence of manifest error, be conclusive and binding on all Parties

 

 

 

Material Franchising Agreement

 

means a franchising agreement entered into by any member of the Group:-

 

(a)                                 where the profits attributable to, or generated under such franchising agreement are equal to or greater than 20 per cent. of the aggregate profits of the Group; or

 

(b)                                 where the turnover attributable to or generated under such franchising agreement is equal to or greater than 20 per cent. of the aggregate turnover of the Group

 

 

 

Month

 

means a period starting on one day in a calendar month and ending on the numerically corresponding day in the next calendar month, except that:-

 

(a)                                 (subject to sub-clause (c) below) if the numerically corresponding day is not a Business Day, that period shall end on the next Business Day in that calendar month in which that period is to end if there is one, or if there is not, on the immediately preceding Business Day

 

(b)                                 if there is no numerically corresponding day in the calendar month in which that period is to end, that period shall end on the last Business Day in that calendar month and

 

(c)                                  if an Interest Period begins on the last Business Day of a calendar month, that Interest Period shall end on the last Business Day in the calendar month in which that Interest Period is to end

 

The above rules will only apply to the last Month of any period

 

 

 

Multi-account Overdraft

 

means an Ancillary Facility which is an overdraft facility comprising more than one account

 

24



 

Net Outstandings

 

means, in relation to a Multi-account Overdraft, the Ancillary Outstandings of that Multi-account Overdraft

 

 

 

NatWest Overdraft Letter

 

means the overdraft letter dated on the First Amendment and Restatement Date between The Royal Bank of Scotland plc as agent for National Westminster Bank Plc and the Company (as amended, varied or replaced from time to time) provided that the amount of the overdraft and ancillary facilities made available pursuant to its terms shall not exceed £12,500,000 at any time plus the Seasonal Excess Amount

 

 

 

New Lender

 

has the meaning given to that term in Clause 35 (Changes to the Lenders)

 

 

 

Northern Bank Agreement

 

means the £2,000,000 facility agreement dated 17 August 2007 as amended on 25 August 2011 made between Danske Bank (previously Northern Bank Limited) and Agnew Corporate Ltd

 

 

 

Northern Irish Obligors

 

means the companies listed in Schedule 1 Part 1 which are incorporated under the laws of Northern Ireland

 

 

 

Notifiable Debt Purchase Transaction

 

has the meaning given to that term in Clause 36.2.2

 

 

 

Obligor

 

means a Borrower or a Guarantor

 

 

 

Obligors’ Agent

 

means the Company appointed to act on behalf of each Obligor in relation to the Finance Documents pursuant to Clause 11.4 (Obligors’ Agent)

 

 

 

Original Financial Statements

 

means:-

 

(a)                                 in relation to each Original Obligor its audited financial statements for its Financial Year ended 31 December 2010

 

(b)                                 in relation to any other Obligor, its audited financial statements delivered to the Agent as required by Clause 37 (Changes to the Obligors)

 

 

 

Original Jurisdiction

 

means, in relation to an Obligor, the jurisdiction under whose laws that Obligor is incorporated as at the date of this Agreement or, in the case of an Additional Obligor, as at the date on which that Additional Obligor becomes Party as a Borrower or a Guarantor (as the case may be);

 

 

 

Original Obligor

 

means an Original Borrower or an Original Guarantor

 

 

 

PAE GmbH”

 

means Penske Automotive Europe GmbH (a company incorporated in Germany)

 

 

 

PAG

 

Penske Automotive Group Inc

 

25



 

Participating Member State

 

means any member state of the European Union that has the euro as its lawful currency in accordance with legislation of the European Union relating to Economic and Monetary Union

 

 

 

Party

 

means a party to this Agreement

 

 

 

Pensions Regulator

 

means the body corporate called the Pensions Regulator established under Part I of the Pensions Act 2004

 

 

 

Permitted Acquisition

 

means:-

 

(a)                                 the acquisition of the entire issued share capital of each of Agnew Retail Limited, Road-field Motors Limited and Agnew Autoexchange Limited provided that such acquisition is funded using the proceeds of the facility referred to in paragraph (m) of the definition of Permitted Financial Indebtedness

 

(b)                                 acquisitions or investments of motor retail operations made in the ordinary course of trade

 

(c)                                  an acquisition by a member of the Group of an asset sold, leased, transferred or otherwise disposed of by another member of the Group in circumstances constituting a Permitted Disposal

 

(d)                                 an acquisition of securities which are Cash Equivalent Investments so long as those Cash Equivalent Investments become subject to the Transaction Security as soon as is reasonably practicable

 

(e)                                  an acquisition for cash consideration, of (A) all of the issued share capital of a limited liability company or (B) (if the acquisition is made by a limited liability company whose sole purpose is to make the acquisition) a business or undertaking carried on as a going concern, but only if:-

 

(i)                                     no Default is continuing on the closing date for the acquisition or would occur as a result of the acquisition

 

(ii)                                  the acquired company, business or undertaking is incorporated or established, and carries on its principal business in, the United Kingdom and

 

(iii)                               the cash consideration (including associated costs and expenses) for the acquisition (the “Total Purchase Price”) does not exceed in aggregate £20,000,000 or its equivalent

 

(f)                                   an acquisition made with the prior written consent of the Agent (acting on the instructions of the Lenders)

 

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Any acquisition will only be permitted under sub-clauses (e)  and (f) if the Company has delivered to the Agent not later than 5 Business Days before legally committing to make such acquisition a certificate signed by two directors of the Company to which is attached a copy of the latest audited accounts (or if not available, management accounts) of the target company or business

 

 

 

Permitted Disposal

 

means any sale, lease, licence, transfer or other disposal which, except in the case of sub-clause (b) is on arm’s length terms:-

 

(a)                                 of trading stock or cash made by any member of the Group in the ordinary course of trading of the disposing entity

 

(b)                                 of any asset by a member of the Group (the “Disposing Company”) to another member of the Group (the “Acquiring Company”), but if:-

 

(i)                                     the Disposing Company is an Obligor, the Acquiring Company must also be an Obligor

 

(ii)                                  the Disposing Company had given Security over the asset, the Acquiring Company must give equivalent Security over that asset and

 

(iii)                               the Disposing Company is a Guarantor, the Acquiring Company must be a Guarantor guaranteeing at all times an amount no less than that guaranteed by the Disposing Company

 

(c)                                  in exchange for other assets comparable or superior as to type, value and quality

 

(d)                                 of obsolete or redundant vehicles, plant and equipment for cash

 

(e)                                  of Cash Equivalent Investments for cash or in exchange for other Cash Equivalent Investments

 

(f)                                   constituted by a licence of intellectual property rights permitted by Clause 33.25 (Intellectual Property)

 

(g)                                  to a Joint Venture, to the extent permitted by Clause 33.10 (Joint ventures)

 

(h)                                 arising as a result of any Permitted Security

 

(i)                                     arising as a result of a Permitted Sale and Leaseback Transaction

 

(j)                                    of any of the Franchises

 

(k)                                 of assets where the proceeds of the Disposal are used

 

27



 

 

 

within 12 months of that Disposal for the purchase of assets to replace the asset which is the subject of that Disposal with assets of a similar type and quality

 

(l)                                     of assets for cash where (A) the higher of the book value and net consideration receivable in respect of any individual asset the subject of the Disposal does not exceed £15,000,000 and (B) where the higher of the book value and net consideration receivable (when aggregated with the higher of the book value and net consideration receivable for any other sale, lease, licence, transfer or other disposal not allowed under the preceding sub-clauses does not exceed £40,000,000 (or its equivalent) in any Financial Year of the Company and

 

(m)                             made with the prior written consent of the Agent (acting on the instructions of the Lenders) such consent not to be unreasonably withheld or delayed

 

 

 

Permitted Distribution

 

means:-

 

(a)                                 the payment of a dividend by the Company to the Parent provided that:

 

(i)                                     such dividend shall not exceed 50 per cent of the consolidated profit of the Group on ordinary activities before taxation in the Financial Year prior to that in which the payment of the dividend is to be made (the “Base Year”) (as evidenced by the consolidated audited financial statements of the Parent for the Base Year delivered to the Agent in accordance with Clause 31.11.1 and the US GAAP Reconciliation Statement for the Base Year delivered to the Agent in accordance with Clause 31.11.2 (and no dividend shall be paid prior to receipt by the Agent of those financial statements and the relevant US GAAP Reconciliation Statement));

 

(ii)                                  the amount of such dividend (the “Total Dividend Amount”), together with the aggregate amount of all loans referred to in paragraph (h) of the definition of Permitted Loan made in the relevant Financial Year of the Company shall not in any Financial Year of the Company exceed £30,000,000;

 

(iii)                               no Financial Event of Default is outstanding at the time such payment is made nor will occur as a result of such payment and

 

(iv)                              such dividend must be paid within the 12 month period following the end of the Base

 

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Year

 

(b)                                 the payment of a dividend to the Company or any of its wholly-owned Subsidiaries

 

(c)                                  the payment of a dividend by the Company to the Parent of up to a maximum amount of £18,800,000 on or after the First Amendment and Restatement Date provided that this dividend is for the purpose of clearing an inter-company balance and there is no cash movement to the Parent in connection with this dividend after the First Amendment and Restatement Date and

 

(d)                                 the payment of a dividend by the Company with the prior written consent of the Agent (acting on the instructions of the Lenders) such consent not be unreasonably withheld or delayed unless an Event of Default is continuing

 

 

 

Permitted Financial Indebtedness

 

means Financial Indebtedness:-

 

(a)                                          arising under the Finance Documents

 

(b)                                          arising under any Stocking Facility

 

(c)                                           arising under the NatWest Overdraft Letter (provided that the aggregate amount of all overdraft and other facilities made available pursuant to the NatWest Overdraft Letter shall not exceed £12,500,000 at any time plus the Seasonal Excess Amount)

 

(d)                                          to the extent covered by a letter of credit, guarantee or indemnity issued under an Ancillary Facility

 

(e)                                           arising under a foreign exchange transaction for spot or forward delivery entered into in connection with protection against fluctuation in currency rates where that foreign exchange exposure arises in the ordinary course of trade, but not a foreign exchange transaction for investment or speculative purposes

 

(f)                                            arising under a Permitted Loan or a Permitted Guarantee

 

(g)                                           as permitted by Clause 33.29 (Treasury Transactions)

 

(h)                                          of any person acquired by a member of the Group after the Closing Date which is incurred under arrangements in existence at the date of acquisition, but not incurred or increased or having its maturity date extended in contemplation of, or since, that acquisition, and outstanding only for a period of six months following the date of acquisition

 

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(i)                                     under Finance Leases of, or hire purchase agreements relating to, motor vehicles

 

(j)                                    existing at the date of this Agreement

 

(k)                                 which is subordinated to the Facility on terms satisfactory to the Agent (acting reasonably)

 

(l)                                     incurred with the prior written consent of the Agent (acting on the instructions of the Lenders)

 

(m)                             arising under the term loan facility dated 10 January 2012 made available by National Westminster Bank Plc to the Company (provided that the maximum aggregate principal amount of that facility shall not exceed £30,000,000 and that such facility is documented on terms substantially the same as the terms of this Agreement (but on a bilateral basis and including market-standard provisions to reflect that the facility is to be used to fund an acquisition))

 

(n)                                 arising under the Ulster Bank Agreement provided that the Financial Indebtedness arising under such agreement will only be permitted if it is less than or equal to £2,000,000

 

(o)                                 arising under the Northern Bank Agreement provided that the Financial Indebtedness arising under such agreement will only be permitted if it is less than or equal to the amount of the facility in place on the date of the 2012 Amendment Deed

 

(p)                                 arising under a Short Term Loan

 

(q)                                 arising under a mortgage of up to £4,000,000 with Lexus Financial Services in respect of the freehold of Lexus Milton Keynes and

 

(r)                                    not otherwise permitted by the preceding paragraphs or as a Permitted Transaction and the outstanding principal amount of which does not exceed £10,000,000 (or its equivalent) in aggregate for the Group at any time

 

Permitted Guarantee

 

means:-

 

(a)                                 the endorsement of negotiable instruments in the ordinary course of trade

 

(b)                                 any performance or similar bond guaranteeing performance by a member of the Group under any contract entered into in the ordinary course of trade

 

(c)                                  any guarantee of a Joint Venture to the extent

 

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permitted by Clause 33.10 (Joint ventures)

 

(d)                                 any guarantee permitted under Clause 33.19 (Financial Indebtedness)

 

(e)                                  any guarantee given in respect of the netting or set-off arrangements permitted pursuant to sub-clause (b) of the definition of Permitted Security or

 

(f)                                   any indemnity given in the ordinary course of the documentation of an acquisition or disposal transaction which is a Permitted Acquisition or Permitted Disposal which indemnity is in a customary form and subject to customary limitations

 

(g)                                  any guarantee given by a member of the Group which is an Obligor in respect of the obligations or liabilities of another member of the Group which is an Obligor

 

(h)                                 any guarantee given by a member of the Group which is not an Obligor in respect of the obligations or liabilities of another member of the Group

 

(i)                                     any guarantee given with the prior written consent of the Agent (acting on the instructions of the Lenders)

 

(j)                                    the guarantee dated 27 February 2007 granted by the Parent and certain members of the Group in favour of the Bilateral Overdraft Lender

 

(k)                                 the guarantee granted by each member of the Group party to the Ulster Bank Agreement in favour of Ulster Bank Limited in respect of the Ulster Bank Agreement

 

(l)                                     the guarantee dated 10 January 2012 granted by each of Isaac Agnew Limited, Agnew Autoexchange Limited, Stanley Motor Works (1932) Limited, Isaac Agnew (Mallusk) Limited, Bavarian Garages (NI) Limited, I A P C B Limited, Isaac Agnew (Holdings) Limited, Trade Parts Specialist (NI) Limited, Agnew Corporate Ltd, Agnew Commercials Limited, Agnew Retail Limited, GAP Software Solutions Ltd and Agnew Trade Centre Limited in favour of Northern Bank Limited

 

(m)                             the guarantees granted by the Company in relation to the obligations of Agnew Autoexchange Limited, Isaac Agnew (Holdings) Limited, Isaac Agnew Limited, I A P C B Limited and Isaac Agnew (Mallusk) Limited to Volkswagen Financial Services (UK) Limited and Volkswagen Bank GmbH and

 

(n)                                 any guarantees granted in addition to those permitted under paragraphs (a) to (j) above provided that the maximum aggregate liability (whether present or future, actual or contingent) of all members of the

 

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Group under all such guarantees does not exceed £7,500,000 at any time

 

 

 

Permitted Joint Venture

 

means any investment in any Joint Venture where:-

 

(a)                                 the Joint Venture is incorporated, or established, and carries on its principal business, in the United Kingdom

 

(b)                                 the Joint Venture is engaged in a business substantially the same as that carried on by the Group and

 

(c)                                  in any Financial Year of the Company, the aggregate (the “Joint Venture Investment”) of:-

 

(i)                                     all amounts subscribed for shares in, lent to, or invested in all such Joint Ventures by any member of the Group;

 

(ii)                                  the contingent liabilities of any member of the Group under any guarantee given in respect of the liabilities of any such Joint Venture and

 

(iii)                               the market value of any assets transferred by any member of the Group to any such Joint Venture,

 

when aggregated with the Total Purchase Price in respect of Permitted Acquisitions in that Financial Year permitted pursuant to sub-clause (d) of the definition of Permitted Acquisition does not exceed £20,000,000 (or its equivalent in other currencies)

 

 

 

Permitted Loan

 

means:-

 

(a)                                 any trade credit extended by any member of the Group to its customers on normal commercial terms and in the ordinary course of its trading activities

 

(b)                                 Financial Indebtedness which is referred to in the definition of, or otherwise constitutes, Permitted Financial Indebtedness (except under sub-clause (f) of that definition)

 

(c)                                  a loan made to a Joint Venture to the extent permitted under Clause 33.10 (Joint ventures)

 

(d)                                 a loan made by a member of the Group which is an Obligor to another member of the Group which is an Obligor or made by a member of the Group which is not an Obligor to another member of the Group

 

(e)                                  any loan made by any member of the Group to a

 

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member of the German Group so long as the aggregate amount of the Financial Indebtedness under any such loans does not exceed £7,500,000 (or its equivalent) at any time

 

(f)                                   the subscription for vendor loan notes in connection with a Permitted Disposal

 

(g)                                  a loan made by a member of the Group to an employee or director of any member of the Group if the amount of that loan when aggregated with the amount of all loans to employees and directors by members of the Group does not exceed £500,000 (or its equivalent) at any time

 

(h)                                 a loan made by the Company to any Subsidiary of PAG which is not a member of the Group, provided that the maximum aggregate amount of all such loans made in any Financial Year of the Company when aggregated with the Total Dividend Amount in respect of Permitted Distributions paid or made in that Financial Year of the Company:

 

(A)                               shall not exceed 50 per cent of the consolidated profit of the Group on ordinary activities before taxation in the Base Year (as defined in the definition of “Permitted Distribution”) (as evidenced by the consolidated audited financial statements of the Parent for the Base Year delivered to the Agent in accordance with Clause 31.11.1 and the US GAAP Reconciliation Statement for the Base Year delivered to the Agent in accordance with Clause 31.11.2 (and no loan permitted pursuant to this paragraph (h)(a) shall be paid prior to receipt by the Agent of those financial statements and the relevant US GAAP Reconciliation Statement)); and

 

(B)                               does not exceed £30,000,000 (or its equivalent in other currencies) and

 

(i)                                     any loan (other than a loan made by a member of the Group to another member of the Group) so long as the aggregate amount of the Financial Indebtedness under any such loans does not exceed £2,500,000 (or its equivalent) at any time,

 

so long as in the case of:-

 

(j)                                    sub-clause (d) above the creditor of such Financial Indebtedness shall (if it is an Obligor) grant security over its rights in respect of such Financial Indebtedness in favour of the Secured Parties on terms acceptable to the Agent (acting on the

 

33



 

 

 

instructions of the Majority Lenders) and

 

(k)                                 sub-clause (f) above to the extent required by the Intercreditor Agreement, the creditor and (if the debtor is a member of the Group) the debtor of such Financial Indebtedness are or become party to the Intercreditor Agreement as an Intra-Group Lender and a Debtor (as defined, in each case, in the Intercreditor Agreement) respectively

 

 

 

Permitted Sale and Leaseback Transaction

 

means a sale and leaseback of any asset of a member of the Group where the net consideration received by the relevant member of the Group does not exceed:

 

(a)                                 £15,000,000 in respect of any single sale and leaseback transaction; and

 

(b)                                 £40,000,000 in aggregate in any Financial Year of the Company

 

 

 

Permitted Security

 

means:-

 

(a)                                 any lien arising by operation of law and in the ordinary course of trading and not as a result of any default or omission by any member of the Group

 

(b)                                 any netting or set-off arrangement entered into by any member of the Group with National Westminster Bank plc in the ordinary course of its banking arrangements for the purpose of netting debit and credit balances of members of the Group (including a Multi-account Overdraft) but only so long as (i) such arrangement does not permit credit balances of Obligors to be netted or set off against debit balances of members of the Group which are not Obligors and (ii) such arrangement does not give rise to other Security over the assets of Obligors in support of liabilities of members of the Group which are not Obligors except, in the case of (i) and (ii) above, to the extent such netting, set-off or Security relates to, or is granted in support of, a loan permitted pursuant to sub-clause (e) of the definition of “Permitted Loan”

 

(c)                                  any payment or close out netting or set-off arrangement pursuant to any Treasury Transaction or foreign exchange transaction entered into by a member of the Group which constitutes Permitted Financial Indebtedness, excluding any Security or Quasi-Security under a credit support arrangement

 

(d)                                 any Security or Quasi-Security over or affecting any asset acquired by a member of the Group after the Closing Date if:-

 

(i)                                     the Security or Quasi-Security was not created in contemplation of the acquisition of

 

34



 

 

 

that asset by a member of the Group

 

(ii)                                  the principal amount secured has not been increased in contemplation of or since the acquisition of that asset by a member of the Group and

 

(iii)                               the Security or Quasi-Security is removed or discharged within 6 months of the date of acquisition of such asset

 

(e)                                  any Security or Quasi-Security over or affecting any asset of any company which becomes a member of the Group after the Closing Date, where the Security or Quasi-Security is created prior to the date on which that company becomes a member of the Group if:-

 

(i)                                     the Security or Quasi-Security was not created in contemplation of the acquisition of that company

 

(ii)                                  the principal amount secured has not increased in contemplation of or since the acquisition of that company and

 

(iii)                               the Security or Quasi-Security is removed or discharged within six months of that company becoming a member of the Group

 

(f)                                   any Security or Quasi-Security arising under any retention of title, hire purchase or conditional sale arrangement or arrangements having similar effect in respect of goods supplied to a member of the Group in the ordinary course of trading and on the supplier’s standard or usual terms and not arising as a result of any default or omission by any member of the Group

 

(g)                                  any Quasi-Security arising as a result of a disposal which is a Permitted Disposal

 

(h)                                 any Security or Quasi-Security arising as a consequence of any finance or capital lease permitted pursuant to sub-clause (h) of the definition of “Permitted Financial Indebtedness”

 

(i)                                     any Security arising pursuant to, or in connection with, a Stocking Facility

 

(j)                                    any Security arising pursuant to the Existing Security Documents

 

(k)                                 any Security or Quasi-Security arising under any agreement entered into by a member of the Group in the ordinary course of its trading activities to sell, transfer or otherwise dispose of any of its assets on terms whereby they are or may be leased to or

 

35



 

 

 

re-acquired by any member of the Group

 

(l)                                     the Security existing at the date of this Agreement and the Second Amendment and Restatement Date in favour of the Bilateral Overdraft Lender

 

(m)                             any Security notified to the Lenders in writing prior to the date of this Agreement and the Second Amendment and Restatement Date except to the extent the principal amount secured by that Security exceeds the amount stated in that notification

 

(n)                                 the Security executed by the target companies described in paragraph (a) of the definition of “Permitted Acquisition” and their subsidiaries in favour of National Westminster Bank Plc as security for the Financial Indebtedness described in paragraph (m) of the definition of Permitted Financial Indebtedness within 10 Business Days of the 2012 Amendment Deed or

 

(o)                                 any Security securing indebtedness the outstanding principal amount of which (when aggregated with the outstanding principal amount of any other indebtedness which has the benefit of Security given by any member of the Group other than any permitted under sub-clauses (a) to (m) above) does not exceed £7,500,000 (or its equivalent in other currencies)

 

 

 

Permitted Treasury Transaction

 

means

 

(a)                                                                                 the hedging transactions documented by the Hedging Agreements;

 

(b)                                                                                 spot and forward delivery foreign exchange contracts entered into in the ordinary course of business and not for speculative purposes

 

(c)                                                                                  any Treasury Transaction entered into for the hedging of actual or projected real exposures arising in the ordinary course of trading activities of a member of the Group for a period of not more than four years and not for speculative purposes or

 

(d)                                 a Treasury Transaction on commercial terms acceptable to the Lenders entered into by a member of the Group with a person other than a Finance Party which does not benefit from Security granted by any member of the Group

 

 

 

Permitted Transaction

 

means:-

 

(a)                                 any disposal required, Financial Indebtedness incurred, guarantee, indemnity or Security or Quasi-

 

36



 

 

 

Security given, or other transaction arising, under the Finance Documents

 

(b)                                 the solvent liquidation or reorganisation of any member of the Group which is not an Obligor so long as any payments or assets distributed as a result of such liquidation or reorganisation are distributed to other members of the Group or

 

(c)                                  transactions (other than (i) any sale, lease, license, transfer or other disposal and (ii) the granting or creation of Security or the incurring or permitting to subsist of Financial Indebtedness) conducted in the ordinary course of trading on arm’s length terms

 

 

 

Properties

 

means any Real Property acquired by an Obligor after the date of this Agreement. A reference to a “Property” is a reference to any of the Properties

 

 

 

Qualifying Lender

 

has the meaning given to that term in Clause 24 (Tax gross-up and indemnities)

 

 

 

Quarter Date

 

means the last day of a Financial Quarter

 

 

 

Quasi-Security

 

has the meaning given to that term in Clause 33.13 (Negative pledge)

 

 

 

Quotation Day

 

means, in relation to any period for which an interest rate is to be determined:-

 

(a)                                 (if the currency is sterling) the first day of that period

 

(b)                                 (if the currency is euro) two TARGET Days before the first day of that period or

 

(c)                                  (for any other currency) two Business Days before the first day of that period,

 

unless market practice differs in the Relevant Market for that currency, in which case the Quotation Day for that currency will be determined by the Agent in accordance with market practice in the Relevant Market (and if quotations would normally be given on more than one day, the Quotation Day will be the last of those days)

 

 

 

Real Property

 

means:-

 

(a)                                 any freehold, leasehold or immovable property and

 

(b)                                 any buildings, fixtures, fittings, fixed plant or machinery from time to time situated on or forming part of that freehold, leasehold or immovable property

 

 

 

Receiver

 

means a receiver or receiver and manager or administrative

 

37



 

 

 

receiver of the whole or any part of the Charged Property

 

 

 

Related Fund

 

in relation to a fund (the “first fund”), means a fund which is managed or advised by the same investment manager or investment adviser as the first fund or, if it is managed by a different investment manager or investment adviser, a fund whose investment manager or investment adviser is an Affiliate of the investment manager or investment adviser of the first fund

 

 

 

Relevant Jurisdiction

 

means, in relation to an Obligor:-

 

(a)                                 its Original Jurisdiction

 

(b)                                 any jurisdiction where any asset subject to or intended to be subject to the Transaction Security to be created by it is situated

 

(c)                                  any jurisdiction where it conducts its business and

 

(d)                                 the jurisdiction whose laws govern the perfection of any of the Transaction Security Documents entered into by it

 

 

 

Relevant Market

 

means the London interbank market

 

 

 

Relevant Period

 

has the meaning given to that term in Clause 32.1 (Financial definitions)

 

 

 

Repayment Date

 

means the last day of an Interest Period for a Loan

 

 

 

Repeating Representations

 

means each of the representations set out in Clause 30.2 (Status) to Clause 30.7 (Governing law and enforcement), Clause 30.11 (No default), Clause 30.12.2, Clause 30.13 (Original Financial Statements), Clause 30.20 (Ranking) to Clause 30.22 (Legal and beneficial ownership) and Clause 30.28 (Centre of main interests and establishments)

 

 

 

Representative

 

means any delegate, agent, manager, administrator, nominee, attorney, trustee or custodian

 

 

 

Resignation Letter

 

means a letter substantially in the form set out in Schedule 10 (Form of Resignation Letter)

 

 

 

Rollover Loan

 

means one or more Loans:-

 

(a)                                 made or to be made on the same day that a maturing Loan is due to be repaid or

 

(b)                                 the aggregate amount of which is equal to or less than the amount of the maturing Loan

 

(c)                                  made or to be made to the same Borrower for the purpose of refinancing that maturing Loan

 

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Screen Rate

 

means the London interbank offered rate administered by ICE Benchmark Administration Limited (or any other person which takes over the administration of that rate) for the relevant currency and period displayed on pages LIBOR01 or LIBOR02 of the Thomson Reuters screen (or any replacement Thomson Reuters page which displays that rate), or on the appropriate page of such other information service which publishes that rate from time to time in place of Thomson Reuters. If such page or service ceases to be available, the Agent may specify another page or service displaying the relevant rate after consultation with the Company.

 

 

 

Seasonal Excess Amount

 

means an additional amount up to a maximum of £40,000,000 made available during the following periods:

 

(a)                                 20 March to 30 April in each year; and

 

(b)                                 20 September to 31 October in each year

 

 

 

Second Amendment and Restatement Agreement

 

means the agreement amending and restating this Agreement entered into between Parties on the Second Amendment and Restatement Date

 

 

 

Second Amendment and Restatement Date

 

means 2 April 2015

 

 

 

Secured Parties

 

means each Finance Party from time to time party to this Agreement and any Receiver or Delegate

 

 

 

Security

 

means a mortgage, charge, pledge, lien or other security interest securing any obligation of any person or any other agreement or arrangement having a similar effect

 

 

 

Short Term Loan

 

means a loan from PAG or any of its Subsidiaries (other than a member the Group) to any member of Group provided that:

 

(a)                                 each such loan is to be repaid within 45 days of being made to the relevant member(s) of the Group (subject to Clause 33.18.3);

 

(b)                                 a maximum of two such loans may be made available to the relevant member(s) of the Group in each calendar year; and

 

(c)                                  such a loan may not be made available unless a period of at least 90 days has elapsed since the previous loan was repaid by the relevant member(s) of the Group

 

 

 

Specified Time

 

means a time determined in accordance with Schedule 12 (Timetables)

 

 

 

Sponsor Affiliate

 

means PAG, each of its Affiliates, any trust of which PAG or any of its Affiliates is a trustee, any partnership of which PAG or any of its Affiliates is a partner and any trust, fund or other entity

 

39



 

 

 

which is managed by, or is under the control of, PAG or any of its Affiliates provided that any such trust, fund or other entity which has been established for at least 6 months solely for the purpose of making, purchasing or investing in loans or debt securities and which is managed or controlled independently from all other trusts, funds or other entities managed or controlled by PAG or any of its Affiliates which have been established for the primary or main purpose of investing in the share capital of companies shall not constitute a Sponsor Affiliate

 

 

 

Stocking Facility

 

means any facility provided to a member of the Group for vehicle stock, used demonstrators and/or consignment stock

 

 

 

Subsidiary

 

means a subsidiary undertaking within the meaning of section 1159 of the Companies Act 2006

 

 

 

TARGET2

 

means the Trans-European Automated Real-time Gross Settlement Express Transfer payment system which utilises a single shared platform and which was launched on 19 November 2007

 

 

 

TARGET Day

 

means any day on which TARGET2 is open for the settlement of payments in euro

 

 

 

Tax

 

means any tax, levy, impost, duty or other charge or withholding of a similar nature (including any penalty or interest payable in connection with any failure to pay or any delay in paying any of the same)

 

 

 

Termination Date

 

means 19 December 2019

 

 

 

Testing Date

 

means the date when the financial covenants contained in Clause 32.2 (Financial condition) are to be tested

 

 

 

Total Commitments

 

means the aggregate of the Commitments, being £150,000,000 at the Second Amendment and Restatement Date

 

 

 

Trade Instruments

 

means any performance bonds, or advance payment bonds or documentary letters of credit issued in respect of the obligations of any member of the Group arising in the ordinary course of trading of that member of the Group

 

 

 

Transaction Security

 

means the Security created or expressed to be created in favour of the Security Agent pursuant to the Transaction Security Documents

 

 

 

Transaction Security Documents

 

means each of the documents listed as being a Transaction Security Document in paragraph 2.6 of Part 1 of Schedule 5 (Conditions Precedent), any document required to be delivered to the Agent under paragraph 13 of Part 2 of Schedule 5 (Conditions Precedent), the debenture dated 24 January 2012 entered into by the Northern Irish Obligors in favour of the Security Agent, together with any other document entered into by any Obligor creating or expressed to create any Security

 

40



 

 

 

over all or any part of its assets in respect of the obligations of any of the Obligors under any of the Finance Documents

 

 

 

Transfer Certificate

 

means a certificate substantially in the form set out in Schedule 7 (Form of Transfer Certificate) or any other form agreed between the Agent and the Company

 

 

 

Transfer Date

 

means, in relation to an assignment or transfer, the later of:-

 

(a)                                 the proposed Transfer Date specified in the relevant Assignment Agreement or Transfer Certificate and

 

(b)                                 the date on which the Agent executes the relevant Assignment Agreement or Transfer Certificate

 

 

 

Treasury Transactions

 

means any derivative transaction entered into in connection with protection against or benefit from fluctuation in any rate or price

 

 

 

UAG Group

 

means the Parent and each of its Subsidiaries from time to time

 

 

 

Ulster Bank Agreement

 

means the working capital facility agreement most recently entered into on 3 July 2014 (and renewed annually) documenting the terms of a working capital facility of up to £2,000,000 to be made available by Ulster Bank Limited to Agnew Retail Limited, Isaac Agnew (Holdings) Limited, Agnew Commercials Limited, Bavarian Garages (NI) Limited, GAP Software Solutions Ltd, Isaac Agnew (Mallusk) Limited, Stanley Motor Works (1932) Limited, Agnew Autoexchange Limited, Agnew Trade Centre Limited, Agnew Corporate Ltd, I A P C B Limited and Isaac Agnew Limited

 

 

 

Unpaid Sum

 

means any sum due and payable but unpaid by an Obligor under the Finance Documents

 

 

 

US

 

means the United States of America

 

 

 

US GAAP Reconciliation Statement

 

means a reconciliation, prepared by the Company, of (i) the Monthly Financial Statements for the Company for the period ending on 31 December in each year and (ii) generally accepted accounting principles in the United States of America which have been applied in preparing the audited financial statements of the Parent referred to in Clause 31.11.1 for the same year

 

 

 

Utilisation

 

means a Loan

 

 

 

Utilisation Date

 

means the date of a Utilisation, being the date on which the relevant Loan is to be made

 

 

 

Utilisation Request

 

means a notice substantially in the relevant form set out in Schedule 6 (Requests and Notices)

 

 

 

VAT

 

means:

 

(a)                                 any tax imposed in compliance with the Council Directive of 28 November 2006 on the common

 

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system of value added tax (EC Directive 2006/112); and

 

(b)                                 any other tax of a similar nature, whether imposed in a member state of the European Union in substitution for, or levied in addition to, such tax referred to in paragraph (a) above, or imposed elsewhere

 

 

 

Vehicle Financier Deeds of Priority

 

means deeds of priority entered into between, among others, the Security Agent and each of the following financiers (in their respective capacities as providers of vehicle finance to certain members of the Group):-

 

(a)                                 BMW Financial Services (GB) Limited;

 

(b)                                 Volkswagen Financial Services (UK) Limited and Volkswagen Bank GmbH (trading as Volkswagen Bank United Kingdom Branch); and

 

(c)                                  Mercedes-Benz Bank AG UK Branch,

 

(each, a “Vehicle Financier Deed of Priority”).

 

10.2                                 Construction

 

10.2.1                      Unless a contrary indication appears, a reference in this Agreement to:-

 

(a)                                          the “Agent”, the “Arranger”, any “Finance Party”, any “Hedge Counterparty”, any “Lender”, any “Obligor”, any “Party”, any “Secured Party”, the “Security Agent”, the “Bilateral Overdraft Lender” or any other person shall be construed so as to include its successors in title, permitted assigns and permitted transferees to, or of, its rights and/or obligations under the Finance Documents and, in the case of the Security Agent, any person for the time being appointed as Security Agent or Security Agents in accordance with the Finance Documents;

 

(b)                                          a document in “agreed form” is a document which is previously agreed in writing by or on behalf of the Company and the Agent or, if not so agreed, is in the form specified by the Agent;

 

(c)                                           assets” includes present and future properties, revenues and rights of every description;

 

(d)                                          a “Finance Document” or any other agreement or instrument is a reference to that Finance Document or other agreement or instrument as amended, novated, supplemented, extended or restated;

 

(e)                                           a “group of Lenders” includes all the Lenders;

 

(f)                                            guarantee” means (other than in Clause 29 (Guarantee and Indemnity)) any guarantee, letter of credit, bond, indemnity or similar assurance against loss, or any obligation, direct or indirect, actual or contingent, to purchase or assume any indebtedness of any person or to make an investment in or loan to any person or to purchase assets

 

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of any person where, in each case, such obligation is assumed in order to maintain or assist the ability of such person to meet its indebtedness;

 

(g)                                           indebtedness” includes any obligation (whether incurred as principal or as surety) for the payment or repayment of money, whether present or future, actual or contingent;

 

(h)                                          a “person” includes any individual, firm, company, corporation, government, state or agency of a state or any association, trust, joint venture, consortium or partnership or other entity (whether or not having separate legal personality);

 

(i)                                              a “regulation” includes any regulation, rule, official directive, request or guideline (whether or not having the force of law but if not having the force of law, being one which is customarily complied with in the relevant jurisdiction by persons or entities equivalent to the relevant person or entity in question) of any governmental, intergovernmental or supranational body, agency, department or of any regulatory, self-regulatory or other authority or organisation;

 

(j)                                             a provision of law is a reference to that provision as amended or re-enacted;

 

(k)                                          “date of this Agreement” means 16 December 2011; and

 

(l)                                              a time of day is a reference to London time.

 

10.2.2                      Section, Clause and Schedule headings are for ease of reference only.

 

10.2.3                      Unless a contrary indication appears, a term used in any other Finance Document or in any notice given under or in connection with any Finance Document has the same meaning in that Finance Document or notice as in this Agreement.

 

10.2.4                      A Borrower providing “cash cover” for an Ancillary Facility means a Borrower paying an amount in the currency of the Ancillary Facility) to an interest-bearing account in the name of the Borrower and the following conditions being met:-

 

(a)                                          the account is with the Security Agent or with the Ancillary Lender for which that cash cover is to be provided;

 

(b)                                          until no amount is or may be outstanding under that Ancillary Facility, withdrawals from the account may only be made to pay the relevant Finance Party amounts due and payable to it under this Agreement in respect of that Ancillary Facility; and

 

(c)                                           the Borrower has executed a security document over that account, in form and substance satisfactory to the Finance Party with which that account is held, creating a first ranking security interest over that account.

 

10.2.5                      A Default (other than an Event of Default) is “continuing” if it has not been remedied or waived and an Event of Default is “continuing” if it has not been waived.

 

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10.2.6                      A Borrower “repaying” or “prepaying” an Ancillary Outstandings means:-

 

(a)                                          that Borrower providing cash cover in respect of the Ancillary Outstandings;

 

(b)                                          the maximum amount payable under the Ancillary Facility being reduced or cancelled in accordance with its terms; or

 

(c)                                           the Ancillary Lender being satisfied that it has no further liability under that Ancillary Facility,

 

and the amount by which the Ancillary Outstandings are, repaid or prepaid under Clauses 10.2.6(a) and 10.2.6(b) above is the amount of the relevant cash cover, reduction or cancellation.

 

10.2.7                      An amount borrowed includes any amount utilised under an Ancillary Facility.

 

10.3                                 Third party rights

 

10.3.1                      A person who is not a Party has no right under the Contracts (Rights of Third Parties) Act 1999 to enforce or enjoy the benefit of any term of this Agreement.

 

10.3.2                      Notwithstanding any term of any Finance Document, the consent of any person who is not a Party is not required to rescind or vary this Agreement at any time.

 

10.4                                Provision of information by directors

 

If any provision of a Finance Document requires a director or any member of the Group to provide any information, to certify any matter or to make any presentation, any such provision, certification or presentation shall, provided it is made in good faith, be made without personal liability on the part of such director (other than in the case of fraud or gross negligence).

 

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SECTION 2

 

THE FACILITY

 

11.                                        THE FACILITY

 

11.1                                 The Facility

 

11.1.1                      Subject to the terms of this Agreement, the Lenders make available a Sterling revolving credit facility in an aggregate amount equal to the Total Commitments.

 

11.1.2                      The Facility will be available to the Company.

 

11.1.3                      Subject to the terms of this Agreement and the Ancillary Documents, an Ancillary Lender may make all or part of its Commitment available to any Borrower as an Ancillary Facility.

 

11.2                                 Increase

 

11.2.1                      The Parent or the Company may by giving prior notice to the Agent by no later than the date falling 10 Business Days after the effective date of a cancellation of:-

 

(a)                                          the Available Commitments of a Defaulting Lender in accordance with Clause 17.5 (Right of cancellation in relation to a Defaulting Lender); or

 

(b)                                          the Commitments of a Lender in accordance with Clause 17.1 (Illegality);

 

request that the Total Commitments be increased (and the Total Commitments under that Facility shall be so increased) in an aggregate amount in the Base Currency of up to the amount of the Available Commitments or Commitments so cancelled as follows:-

 

(c)                                           the increased Commitments will be assumed by one or more Lenders or other banks, financial institutions, trusts, funds or other entities (each an “Increase Lender”) selected by the Parent or the Company (each of which shall not be a Sponsor Affiliate or a member of the Group and which is further acceptable to the Agent (acting reasonably)) and each of which confirms in writing (whether in the relevant Increase Confirmation or otherwise) its willingness to assume and does assume all the obligations of a Lender corresponding to that part of the increased Commitments which it is to assume, as if it had been an Original Lender;

 

(d)                                          each of the Obligors and any Increase Lender shall assume obligations towards one another and/or acquire rights against one another as the Obligors and the Increase Lender would have assumed and/or acquired had the Increase Lender been an Original Lender;

 

(e)                                           each Increase Lender shall become a Party as a “Lender” and any Increase Lender and each of the other Finance Parties shall assume obligations towards one another and acquire rights against one another as that Increase Lender and those Finance Parties would have

 

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assumed and/or acquired had the Increase Lender been an Original Lender;

 

(f)                                            the Commitments of the other Lenders shall continue in full force and effect; and

 

(g)                                           any increase in the Total Commitments shall take effect on the date specified by the Parent or the Company in the notice referred to above or any later date on which the conditions set out in Clause 11.2.2 below are satisfied.

 

11.2.2                      An increase in the Total Commitments will only be effective on:-

 

(a)                                          the execution by the Agent of an Increase Confirmation from the relevant Increase Lender;

 

(b)                                          in relation to an Increase Lender which is not a Lender immediately prior to the relevant increase:-

 

(i)                                              the Increase Lender entering into the documentation required for it to accede as a party to the Intercreditor Agreement; and

 

(ii)                                           the Agent being satisfied that it has complied with all necessary “know your customer” or other similar checks under all applicable laws and regulations in relation to the assumption of the increased Commitments by that Increase Lender. The Agent shall promptly notify the Parent and the Increase Lender upon being so satisfied.

 

11.2.3                      Each Increase Lender, by executing the Increase Confirmation, confirms (for the avoidance of doubt) that the Agent has authority to execute on its behalf any amendment or waiver that has been approved by or on behalf of the requisite Lender or Lenders in accordance with this Agreement on or prior to the date on which the increase becomes effective.

 

11.2.4                      The Parent shall promptly on demand pay the Agent and the Security Agent the amount of all costs and expenses (including legal fees) reasonably incurred by either of them and, in the case of the Security Agent, by any Receiver or Delegate in connection with any increase in Commitments under this Clause 11.2.

 

11.2.5                      The Parent may pay to the Increase Lender a fee in the amount and at the times agreed between the Parent and the Increase Lender in a Fee Letter.

 

11.2.6                      Clause 35.4 (Limitation of responsibility of Existing Lenders) shall apply mutatis mutandis in this Clause 11.2 in relation to an Increase Lender as if references in that Clause to:-

 

(a)                                          an “Existing Lender” were references to all the Lenders immediately prior to the relevant increase;

 

(b)                                          the “New Lender” were references to that “Increase Lender”; and

 

(c)                                           a “re-transfer” and “re-assignment” were references to respectively a “transfer” and “assignment”.

 

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11.3                                 Finance Parties’ rights and obligations

 

11.3.1                      The obligations of each Finance Party under the Finance Documents are several.  Failure by a Finance Party to perform its obligations under the Finance Documents does not affect the obligations of any other Party under the Finance Documents.  No Finance Party is responsible for the obligations of any other Finance Party under the Finance Documents.

 

11.3.2                      The rights of each Finance Party under or in connection with the Finance Documents are separate and independent rights and any debt arising under the Finance Documents to a Finance Party from an Obligor shall be a separate and independent debt.

 

11.3.3                      A Finance Party may, except as otherwise stated in the Finance Documents, separately enforce its rights under the Finance Documents.

 

11.4                                Obligors’ Agent

 

11.4.1                      Each Obligor (other than the Company) by its execution of this Agreement or an Accession Deed irrevocably appoints the Company (acting through one or more authorised signatories) to act on its behalf as its agent in relation to the Finance Documents and irrevocably authorises:-

 

(a)                                          the Company on its behalf to supply all information concerning itself contemplated by this Agreement to the Finance Parties and to give all notices and instructions (including, in the case of a Borrower, Utilisation Requests), to execute on its behalf any Accession Deed, to make such agreements and to effect the relevant amendments, supplements and variations capable of being given, made or effected by any Obligor notwithstanding that they may affect the Obligor, without further reference to or the consent of that Obligor; and

 

(b)                                          each Finance Party to give any notice, demand or other communication to that Obligor pursuant to the Finance Documents to the Company,

 

and in each case the Obligor shall be bound as though the Obligor itself had given the notices and instructions (including, without limitation, any Utilisation Requests) or executed or made the agreements or effected the amendments, supplements or variations, or received the relevant notice, demand or other communication.

 

11.4.2                      Every act, omission, agreement, undertaking, settlement, waiver, amendment, supplement, variation, notice or other communication given or made by the Obligors’ Agent or given to the Obligors’ Agent under any Finance Document on behalf of another Obligor or in connection with any Finance Document (whether or not known to any other Obligor and whether occurring before or after such other Obligor became an Obligor under any Finance Document) shall be binding for all purposes on that Obligor as if that Obligor had expressly made, given or concurred with it. In the event of any conflict between any notices or other communications of the Obligors’ Agent and any other Obligor, those of the Obligors’ Agent shall prevail.

 

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12.                                        PURPOSE

 

12.1                                Each Borrower shall apply all amounts borrowed by it under the Facility and any utilisation of any Ancillary Facility towards the general corporate and working capital purposes of the Group (but not, in the case of any utilisation of any Ancillary Facility, towards prepayment of any Utilisation).

 

12.2                                 Monitoring

 

No Finance Party is bound to monitor or verify the application of any amount borrowed pursuant to this Agreement.

 

13.                                        CONDITIONS OF UTILISATION

 

13.1                                 Initial conditions precedent

 

13.1.1                      The Lenders will only be obliged to comply with Clause 14.4 (Lenders’ participation) in relation to any Utilisation if on or before the Utilisation Date for that Utilisation, the Agent has received (or waived its requirement to receive) all of the documents and other evidence listed in Part 1 of Schedule 5 (Conditions precedent) in form and substance satisfactory to the Agent.  The Agent shall notify the Company and the Lenders promptly upon being so satisfied. The documents and other evidence listed in Part 1 of Schedule 5 (Conditions precedent) were satisfied or waived on or around 16 December 2011.

 

13.1.2                      Other than to the extent that the Majority Lenders notify the Agent in writing to the contrary before the Agent gives the notification described in Clause 13.1.1 above, the Lenders authorise (but do not require) the Agent to give that notification.  The Agent shall not be liable for any damages, costs or losses whatsoever as a result of giving any such notification.

 

13.2                                 Further conditions precedent

 

Subject to Clause 13.1 (Initial Conditions Precedent), the Lenders will only be obliged to comply with Clause 14.4 (Lenders’ participation), if on the date of the Utilisation Request and on the proposed Utilisation Date:-

 

13.2.1                      in the case of a Rollover Loan, no Event of Default is continuing or would result from the proposed Loan, and in the case of any other Utilisation, no Default is continuing or would result from the proposed Utilisation; and

 

13.2.2                      in relation to any Utilisation on the Closing Date, all the representations and warranties in Clause 30 (Representations) or, in relation to any other Utilisation, the Repeating Representations to be made by each Obligor are true in all material respects.

 

13.3                                 Maximum number of Utilisations

 

A Borrower (or the Company) may not deliver a Utilisation Request if as a result of the proposed Utilisation more than 10 Utilisations would be outstanding.

 

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SECTION 3

 

UTILISATION

 

14.                                        UTILISATION - LOANS

 

14.1                                 Delivery of a Utilisation Request

 

A Borrower (or the Company on its behalf) may utilise the Facility by delivery to the Agent of a duly completed Utilisation Request not later than the Specified Time.

 

14.2                                 Completion of a Utilisation Request for Loans

 

14.2.1                      Each Utilisation Request for a Loan is irrevocable and will not be regarded as having been duly completed unless:-

 

(a)                                          the proposed Utilisation Date is a Business Day within the Availability Period;

 

(b)                                          the currency and amount of the Utilisation comply with Clause 14.3 (Currency and amount); and

 

(c)                                           the proposed Interest Period complies with Clause 21 (Interest Periods).

 

14.2.2                      Only one Utilisation may be requested in each Utilisation Request.

 

14.3                                 Currency and amount

 

14.3.1                      The currency specified in a Utilisation Request must be Sterling.

 

14.3.2                      The amount of the proposed Utilisation must be an amount which is not more than the Available Facility and which is a minimum of £250,000 or, if less, the Available Facility.

 

14.4                                 Lenders’ participation

 

14.4.1                      If the conditions set out in this Agreement have been met, and subject to Clause 16.1 (Repayment of Loans), each Lender shall make its participation in each Loan available by the Utilisation Date through its Facility Office.

 

14.4.2                      Other than as set out in Clause 14.4.3 below, the amount of each Lender’s participation in each Loan will be equal to the proportion borne by its Available Commitment to the Available Facility immediately prior to making the Loan.

 

14.4.3                      If a Utilisation is made to repay Ancillary Outstandings, each Lender’s participation in that Utilisation will be in an amount (as determined by the Agent) which will result as nearly as possible in the aggregate amount of its participation in the Utilisations then outstanding bearing the same proportion to the aggregate amount of the Utilisations then outstanding as its Commitment bears to the Total Commitments.

 

14.4.4                      The Agent shall notify each Lender of the amount of each Loan and the amount of its participation in that Loan and, if different, the amount of that participation to

 

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be made available in accordance with Clause 41.1 (Payments to the Agent), in each case by the Specified Time.

 

14.5                                 Limitations on Utilisations

 

14.5.1                      The maximum aggregate amount of the Ancillary Commitments of all the Lenders shall not at any time exceed £15,000,000.

 

14.5.2                      The maximum aggregate amount of the Ancillary Commitments of all the Lenders made available by way of overdraft, same-day access LIBOR loan facility or other facility made available on a short term basis shall not at any time exceed £10,000,000.

 

14.6                                 Cancellation of Commitment

 

The Commitments which, at that time, are unutilised shall be immediately cancelled at the end of the Availability Period.

 

15.                                        ANCILLARY FACILITIES

 

15.1                                 Type of Facility

 

An Ancillary Facility may be by way of:-

 

15.1.1                      an overdraft facility;

 

15.1.2                      a same-day access LIBOR loan facility;

 

15.1.3                      a guarantee, bonding, documentary or stand-by letter of credit facility; or

 

15.1.4                      any other facility or accommodation required in connection with the business of the Group and which is agreed by the Company with an Ancillary Lender.

 

15.2                                 Availability

 

15.2.1                      If the Company and a Lender agree and except as otherwise provided in this Agreement, the Lender may provide all or part of its Commitment as an Ancillary Facility).  For the avoidance of doubt, BMW Financial Services (GB) Limited shall not be an Ancillary Lender.  The Royal Bank of Scotland plc (as agent for National Westminster Bank Plc) shall make available to the Company within 45 days of the date of this Agreement, an Ancillary Facility by way of a same-day access LIBOR loan facility on an un-committed basis provided that no Default has occurred or is continuing and that the other terms of this Agreement relating to the provision of Ancillary Facilities have been complied with in relation to that Ancillary Facility;

 

15.2.2                      An Ancillary Facility shall not be made available unless, not later than 5 Business Days prior to the Ancillary Commencement Date for an Ancillary Facility, the Agent has received from the Company:-

 

(a)                                          a notice in writing of the establishment of an Ancillary Facility and specifying:-

 

(i)                                              the proposed Borrower(s) (or Affiliates of a Borrower) which may use the Ancillary Facility;

 

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(ii)                                           the proposed Ancillary Commencement Date and expiry date of the Ancillary Facility;

 

(iii)                                        the proposed type of Ancillary Facility to be provided;

 

(iv)                                       the proposed Ancillary Lender;

 

(v)                                          the proposed Ancillary Commitment, the maximum amount of the Ancillary Facility in the case of a Multi-account Overdraft, its Designated Gross Amount and its Designated Net Amount; and

 

(b)                                          any other information which the Agent may reasonably request in connection with the Ancillary Facility.

 

The Agent shall promptly notify the Ancillary Lender and the other Lenders of the establishment of an Ancillary Facility.

 

15.2.3                      Subject to compliance with Clause 15.2.2 above:-

 

(a)                                          the Lender concerned will become an Ancillary Lender; and

 

(b)                                          the Ancillary Facility will be available,

 

with effect from the date agreed by the Company and the Ancillary Lender.

 

15.3                                 Terms of Ancillary Facilities

 

15.3.1                      Except as provided below, the terms of any Ancillary Facility will be those agreed by the Ancillary Lender and the Company.

 

15.3.2                      Those terms:-

 

(a)                                          must be based upon normal commercial terms at that time (except as varied by this Agreement);

 

(b)                                          may allow only Borrowers (or Affiliates of Borrowers nominated pursuant to Clause 15.9 (Affiliates of Borrowers)) to use the Ancillary Facility;

 

(c)                                           may not allow the Ancillary Outstandings to exceed the Ancillary Commitment;

 

(d)                                          may not allow the Ancillary Commitment of a Lender to exceed the Available Commitment with respect to the Facility of that Lender; and

 

(e)                                           must require that the Ancillary Commitment is reduced to zero, and that all Ancillary Outstandings are repaid not later than the Termination Date (or such earlier date as the Commitment of the relevant Ancillary Lender (or its Affiliate) is reduced to zero).

 

15.3.3                      If there is any inconsistency between any term of an Ancillary Facility and any term of this Agreement, this Agreement shall prevail except for (i) Clause 44.3 (Day count convention) which shall not prevail for the purposes of calculating fees, interest or commission relating to an Ancillary Facility; (ii) an Ancillary

 

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Facility comprising more than one account where the terms of the Ancillary Documents shall prevail to the extent required to permit the netting of balances on those accounts; and (iii) where the relevant term of this Agreement would be contrary to, or inconsistent with, the law governing the relevant Ancillary Document, in which case that term of this Agreement shall not prevail.

 

15.3.4                      Interest, commission and fees on Ancillary Facilities are dealt with in Clause 23.5 (Interest, commission and fees on Ancillary Facilities).

 

15.4                                 Repayment of Ancillary Facility

 

15.4.1                      An Ancillary Facility shall cease to be available on the Termination Date or such earlier date on which its expiry date occurs or on which it is cancelled in accordance with the terms of this Agreement.

 

15.4.2                      If an Ancillary Facility expires in accordance with its terms the Ancillary Commitment of the Ancillary Lender shall be reduced to zero (and its Commitment shall be increased accordingly).

 

15.4.3                      No Ancillary Lender may demand repayment or prepayment of any Ancillary Outstandings prior to the expiry date of the Ancillary Facility unless:-

 

(a)                                          required to reduce the Gross Outstandings of a Multi-account Overdraft to or towards an amount equal to its Net Outstandings;

 

(b)                                          the Total Commitments have been cancelled in full, or all outstanding Utilisations under the Facility have become due and payable in accordance with the terms of this Agreement;

 

(c)                                           it becomes unlawful in any applicable jurisdiction for the Ancillary Lender to perform any of its obligations as contemplated by this Agreement or to fund, issue or maintain its participation in its Ancillary Facility; or

 

(d)                                          both:

 

(i)                                              the Available Commitments; and

 

(ii)                                           the notice of the demand given by the Ancillary Lender,

 

(e)                                           would not prevent the relevant Borrower funding the repayment of those Ancillary Outstandings in full by way of Utilisation.

 

15.4.4                      If a Utilisation is made to repay Ancillary Outstandings in full, the Commitment of the Ancillary Lender shall be reduced to zero.

 

15.5                                 Limitation on Ancillary Outstandings

 

Each Borrower shall procure that:-

 

15.5.1                      the Ancillary Outstandings under any Ancillary Facility shall not exceed the Ancillary Commitment applicable to that Ancillary Facility; and

 

15.5.2                      in relation to a Multi-account Overdraft:-

 

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(a)              the Ancillary Outstandings shall not exceed the Designated Net Amount applicable to that Multi-account Overdraft.

 

(b)              the Gross Outstandings shall not exceed the Designated Gross Amount applicable to that Multi-account Overdraft.

 

15.6           Adjustment for Ancillary Facilities upon acceleration

 

In this Clause 15.6:-

 

Revolving Outstandings

 

means, in relation to a Lender, the aggregate of:-

 

(a)           its participation in each Utilisation then outstanding (together with the aggregate amount of all accrued interest, fees and commission owed to it as a Lender under the Facility); and

 

(b)           if the Lender is also an Ancillary Lender, the Ancillary Outstandings in respect of Ancillary Facilities provided by that Ancillary Lender (or by its Affiliate) (together with the aggregate amount of all accrued interest, fees and commission owed to it (or to its Affiliate) as an Ancillary Lender in respect of the Ancillary Facility); and

 

 

 

Total Revolving Outstandings

 

means the aggregate of all Revolving Outstandings

 

15.6.1       If a notice is served under Clause 34.18 (Acceleration) (other than a notice declaring Utilisations to be due on demand), each Lender and each Ancillary Lender shall promptly adjust (by making or receiving (as the case may be) corresponding transfers of rights and obligations under the Finance Documents relating to Revolving Outstandings) their claims in respect of amounts outstanding to them under the Facility and each Ancillary Facility to the extent necessary to ensure that after such transfers the Revolving Outstandings of each Lender bear the same proportion to the Total Revolving Outstandings as such Lender’s Commitment bears to the Total Commitments, each as at the date the notice is served under Clause 34.18 (Acceleration).

 

15.6.2       If an amount outstanding under an Ancillary Facility is a contingent liability and that contingent liability becomes an actual liability or is reduced to zero after the original adjustment is made under Clause 15.6.1, then each Lender and Ancillary Lender will make a further adjustment (by making or receiving (as the case may be) corresponding transfers of rights and obligations under the Finance Documents relating to Revolving Outstandings to the extent necessary) to put themselves in the position they would have been in had the original adjustment been determined by reference to the actual liability or, as the case may be, zero liability and not the contingent liability.

 

15.6.3       Any transfer of rights and obligations relating to Revolving Outstandings made pursuant to this Clause 15.6 shall be made for a purchase price in cash, payable at the time of transfer, in an amount equal to those Revolving Outstandings (less any accrued interest, fees and commission to which the transferor will remain

 

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entitled to receive notwithstanding that transfer, pursuant to Clause 35.10 (Pro rata interest settlement)).

 

15.6.4       Prior to the application of the provisions of Clause 15.6.1, an Ancillary Lender that has provided a Multi-account Overdraft shall set-off any Available Credit Balance on any account comprised in that Multi-account Overdraft.

 

15.6.5       All calculations to be made pursuant to this Clause 15.6 shall be made by the Agent based upon information provided to it by the Lenders and Ancillary Lenders and the Agent’s Spot Rate of Exchange.

 

15.7           Information

 

Each Borrower and each Ancillary Lender shall, promptly upon request by the Agent, supply the Agent with any information relating to the operation of an Ancillary Facility (including the Ancillary Outstandings) as the Agent may reasonably request from time to time.  Each Borrower consents to all such information being released to the Agent and the other Finance Parties.

 

15.8           Affiliates of Lenders as Ancillary Lenders

 

15.8.1       Subject to the terms of this Agreement, an Affiliate of a Lender may become an Ancillary Lender.  In such case, the Lender and its Affiliate shall be treated as a single Lender whose Commitment is the amount set out opposite the relevant Lender’s name in Part 2 or Part 3 of Schedule 4 (The Original Parties) and/or the amount of any Commitment transferred to or assumed by that Lender under this Agreement, to the extent (in each case) not cancelled, reduced or transferred by it under this Agreement.  For the purposes of calculating the Lender’s Available Commitment with respect to the Facility, the Lender’s Commitment shall be reduced to the extent of the aggregate of the Ancillary Commitments of its Affiliates.

 

15.8.2       The Company shall specify any relevant Affiliate of a Lender in any notice delivered by the Company to the Agent pursuant to Clause 15.2.2(a).

 

15.8.3       An Affiliate of a Lender which becomes an Ancillary Lender shall accede to the Intercreditor Agreement as an Ancillary Lender and any person which so accedes to the Intercreditor Agreement shall, at the same time, become a Party as an Ancillary Lender in accordance with clause 20.5.2 (Deeds of Accession) of the Intercreditor Agreement.

 

15.8.4       If a Lender assigns all of its rights and benefits or transfers all of its rights and obligations to a New Lender, its Affiliate shall cease to have any obligations under this Agreement or any Ancillary Document.

 

15.8.5       Where this Agreement or any other Finance Document imposes an obligation on an Ancillary Lender and the relevant Ancillary Lender is an Affiliate of a Lender which is not a party to that document, the relevant Lender shall ensure that the obligation is performed by its Affiliate.

 

15.9           Affiliates of Borrowers

 

15.9.1       Subject to the terms of this Agreement, an Affiliate of a Borrower may with the approval of the relevant Lender become a borrower with respect to an Ancillary Facility.

 

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15.9.2       The Company shall specify any relevant Affiliate of a Borrower in any notice delivered by the Company to the Agent pursuant to Clause 15.2.2(a).

 

15.9.3       If a Borrower ceases to be a Borrower under this Agreement in accordance with Clause 37.3 (Resignation of a Borrower), its Affiliate shall cease to have any rights under this Agreement or any Ancillary Document.

 

15.9.4       Where this Agreement or any other Finance Document imposes an obligation on a Borrower under an Ancillary Facility and the relevant Borrower is an Affiliate of a Borrower which is not a party to that document, the relevant Borrower shall ensure that the obligation is performed by its Affiliate.

 

15.9.5       Any reference in this Agreement or any other Finance Document to a Borrower being under no obligations (whether actual or contingent) as a Borrower under such Finance Document shall be construed to include a reference to any Affiliate of a Borrower being under no obligations under any Finance Document or Ancillary Document.

 

15.10         Commitment amounts

 

Notwithstanding any other term of this Agreement, each Lender shall ensure that at all times its Commitment is not less than:-

 

15.10.1     its Ancillary Commitment; or

 

15.10.2     the Ancillary Commitment of its Affiliate.

 

15.11         Amendments and Waivers - Ancillary Facilities

 

No amendment or waiver of a term of any Ancillary Facility shall require the consent of any Finance Party other than the relevant Ancillary Lender unless such amendment or waiver itself relates to or gives rise to a matter which would require an amendment of or under this Agreement (including, for the avoidance of doubt, under this Clause 15).  In such a case, Clause 47 (Amendments and waivers) will apply.

 

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SECTION 4

 

REPAYMENT, PREPAYMENT AND CANCELLATION

 

16.             REPAYMENT

 

16.1           Repayment of Loans

 

16.1.1       Each Borrower which has drawn a Loan shall repay that Loan on the last day of its Interest Period.

 

16.1.2       Without prejudice to each Borrower’s obligation under Clause 16.1.1 above, if:

 

(a)              one or more Loans are to be made available to a Borrower:-

 

(i)               on the same day that a maturing Loan is due to be repaid by that Borrower;

 

(ii)              in whole or in part for the purpose of refinancing the maturing Loan; and

 

(b)              the proportion borne by each Lender’s participation in the maturing Loan to the amount of that maturing Loan is the same as the proportion borne by that Lender’s participation in the new Loan to the aggregate amount of those new Loans,

 

the aggregate amount of the new Loans shall , unless the Borrower notifies the Agent to the contrary in the relevant Utilisation Request, be treated as if applied in or towards repayment of the maturing Loan so that:-

 

(a)              if the amount of the maturing Loan exceeds the aggregate amount of the new Loans:-

 

(i)               the relevant Borrower will only be required to make a payment under Clause 41.1 in an amount in the relevant currency equal to that excess; and

 

(ii)              each Lender’s participation in the new Loans shall be treated as having been made available and applied by the Borrower in or towards repayment of that Lender’s participation in the maturing Loan and that Lender will not be required to make a payment under Clause 41.1 in respect of its participation in the new Loans; and

 

(b)              if the amount of the maturing Loan is equal to or less than the aggregate amount of the new Loans:-

 

(i)               the relevant Borrower will not be required to make a payment under Clause 41.1; and

 

(ii)              each Lender will be required to make a payment under Clause 41.1 in respect of its participation in the new Loans only to the extent that its participation in the new Loans exceeds that Lender’s participation in the maturing Loan and the remainder of that Lender’s participation in the new Loans

 

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shall be treated as having been made available and applied by the Borrower in or towards repayment of that Lender’s participation in the maturing Loan.

 

17.             ILLEGALITY, VOLUNTARY PREPAYMENT AND CANCELLATION

 

17.1           Illegality

 

If it becomes unlawful in any applicable jurisdiction for a Lender to perform any of its obligations as contemplated by this Agreement or to fund, issue or maintain its participation in any Utilisation:-

 

17.1.1       that Lender, shall promptly notify the Agent upon becoming aware of that event;

 

17.1.2       upon the Agent notifying the Company, the Available Commitment of that Lender will be immediately cancelled; and

 

17.1.3       each Borrower shall repay that Lender’s participation in the Utilisations made to that Borrower on the last day of the Interest Period for each Utilisation occurring after the Agent has notified the Company or, if earlier, the date specified by the Lender in the notice delivered to the Agent (being no earlier than the last day of any applicable grace period permitted by law) and that Lender’s corresponding Commitment(s) shall be cancelled in the amount of the participations repaid.

 

17.2           Voluntary cancellation

 

The Company may, if it gives the Agent not less than 10 Business Days’ (or such shorter period as the Majority Lenders may agree) prior notice, cancel the whole or any part (being a minimum amount and an integral multiple, of £250,000) of the Available Facility.  Any cancellation under this Clause 17.2 shall reduce the Commitments of the Lenders rateably under the Facility.

 

17.3           Voluntary prepayment of Utilisations

 

A Borrower to which a Utilisation has been made may, if it or the Company gives the Agent not less than 5 Business Days’ (or such shorter period as the Majority Lenders may agree) prior notice, prepay the whole or any part of a Utilisation (but if in part, being an amount that reduces the amount of the Utilisation by a minimum amount, and an integral multiple, of £250,000).

 

17.4           Right of cancellation and repayment in relation to a single Lender

 

17.4.1       If:-

 

(a)              any sum payable to any Lender by an Obligor is required to be increased under Clause 24.2.3; or

 

(b)              any Lender claims indemnification from the Company or an Obligor under Clause 24.3 (Tax indemnity) or Clause 25.1 (Increased costs),

 

the Company may, whilst the circumstance giving rise to the requirement for that increase or indemnification continues, give the Agent notice of cancellation of the Commitment of that Lender and its intention to procure the repayment of that Lender’s participation in the Utilisations.

 

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17.4.2       On receipt of a notice referred to in Clause 17.4.1 above in relation to a Lender, the Commitment of that Lender shall immediately be reduced to zero.

 

17.4.3       On the last day of each Interest Period which ends after the Company has given notice under Clause 17.4.1 above in relation to a Lender (or, if earlier, the date specified by the Company in that notice), each Borrower to which a Utilisation is outstanding shall repay that Lender’s participation in that Utilisation together with all interest and other amounts accrued under the Finance Documents.

 

17.5           Right of cancellation in relation to a Defaulting Lender

 

17.5.1       If any Lender becomes a Defaulting Lender, the Parent or the Company may, at any time whilst the Lender continues to be a Defaulting Lender, give the Agent 10 Business Days’ notice of cancellation of each Available Commitment of that Lender.

 

17.5.2       On the notice referred to in Clause 17.5.1 above becoming effective, each Available Commitment of the Defaulting Lender shall immediately be reduced to zero.

 

17.5.3       The Agent shall as soon as practicable after receipt of a notice referred to in Clause 17.5.1 above, notify all the Lenders.

 

18.             MANDATORY PREPAYMENT

 

18.1           Exit

 

18.1.1       For the purpose of this Clause 18.1:-

 

FCA

 

means the Financial Conduct Authority acting in accordance with Part 6 of the Financial Services and Markets Act 2000

 

 

 

Flotation

 

means:-

 

(a)           a successful application being made for the admission of any part of the share capital of any member of the Group (or Holding Company of any member of the Group) to the Official List maintained by the FCA and the admission of any part of the share capital of any member of the Group (or Holding Company of any member of the Group) to trading on the London Stock Exchange plc or

 

(b)           the grant of permission to deal in any part of the issued share capital of any member of the Group (or Holding Company of any member of the Group) on the Alternative Investment Market or the Main Board or the Growth Market of the ICAP Securities & Derivatives Exchange (ISDX) or on any recognised investment exchange (as that term is used in the Financial Services and Markets Act 2000) or in or on any exchange or market replacing the same or any other exchange

 

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or market in any country

 

18.1.2       Upon the occurrence of:-

 

(a)              any Flotation; or

 

(b)              a Change of Control; or

 

(c)              the sale of all or substantially all of the assets of the Group whether in a single transaction or a series of related transactions,

 

the Facility will be cancelled and all outstanding Utilisations and Ancillary Outstandings, together with accrued interest, and all other amounts accrued under the Finance Documents, shall become immediately due and payable.

 

19.             RESTRICTIONS

 

19.1           Notices of Cancellation or Prepayment

 

Any notice of cancellation, prepayment, authorisation or other election given by any Party under Clause 17 (Illegality, voluntary prepayment and cancellation) shall (subject to the terms of those Clauses) be irrevocable and, unless a contrary indication appears in this Agreement, shall specify the date or dates upon which the relevant cancellation or prepayment is to be made and the amount of that cancellation or prepayment.

 

19.2           Interest and other amounts

 

Any prepayment under this Agreement shall be made together with accrued interest on the amount prepaid and, subject to any Break Costs, without premium or penalty.

 

19.3           Reborrowing of Facility

 

Unless a contrary indication appears in this Agreement, any part of the Facility which is prepaid or repaid may be reborrowed in accordance with the terms of this Agreement.

 

19.4           Prepayment in accordance with Agreement

 

No Borrower shall repay or prepay all or any part of the Utilisations or cancel all or any part of the Commitments except at the times and in the manner expressly provided for in this Agreement.

 

19.5           No reinstatement of Commitments

 

Subject to Clause 11.2 (Increase), no amount of the Total Commitments cancelled under this Agreement may be subsequently reinstated.

 

19.6           Agent’s receipt of Notices

 

If the Agent receives a notice under Clause 17 (Illegality, voluntary prepayment and cancellation) it shall promptly forward a copy of that notice or election to either the Company or the affected Lender, as appropriate.

 

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19.7           Effect of Repayment and Prepayment on Commitments

 

If all or part of any Lender’s participation in a Utilisation under the Facility is repaid or prepaid and is not available for redrawing (other than by operation of Clause 13.2 (Further conditions precedent)), an amount of that Lender’s Commitments (equal to the amount of the participation which is repaid or prepaid) in respect of the Facility will be deemed to be cancelled on the date of repayment or prepayment.

 

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SECTION 5

 

COSTS OF UTILISATION

 

20.                                        INTEREST

 

20.1                                 Calculation of interest

 

The rate of interest on each Loan for each Interest Period is the percentage rate per annum which is the aggregate of the applicable:-

 

20.1.1                      Margin; and

 

20.1.2                      LIBOR.

 

20.2                                 Payment of interest

 

20.2.1                      The Borrower to which a Loan has been made shall pay accrued interest on that Loan on the last day of each Interest Period (and, if the Interest Period is longer than six Months, on the dates falling at six Monthly intervals after the first day of the Interest Period).

 

20.2.2                      If the annual audited financial statements of the Group and related Compliance Certificate received by the Agent show that a higher Margin should have applied during a certain period, then the Company shall (or shall ensure the relevant Borrower shall) promptly pay to the Agent any amounts necessary to put the Agent and the Lenders in the position they would have been in had the appropriate rate of the Margin applied during such period.

 

20.3                                 Default interest

 

20.3.1                      If an Obligor fails to pay any amount payable by it under a Finance Document on its due date, interest shall accrue on the overdue amount from the due date up to the date of actual payment (both before and after judgment) at a rate which, subject to Clause 20.3.2 below, is 2.0 per cent per annum higher than the rate which would have been payable if the overdue amount had, during the period of non-payment, constituted a Loan in the currency of the overdue amount for successive Interest Periods, each of a duration selected by the Agent (acting reasonably).  Any interest accruing under this Clause 20.3 shall be immediately payable by the Obligor on demand by the Agent.

 

20.3.2                      If any overdue amount consists of all or part of a Loan which became due on a day which was not the last day of an Interest Period relating to that Loan:-

 

(a)                                          the first Interest Period for that overdue amount shall have a duration equal to the unexpired portion of the current Interest Period relating to that Loan; and

 

(b)                                          the rate of interest applying to the overdue amount during that first Interest Period shall be 2.0 per cent per annum higher than the rate which would have applied if the overdue amount had not become due.

 

20.3.3                      Default interest (if unpaid) arising on an overdue amount will be compounded with the overdue amount at the end of each Interest Period applicable to that overdue amount but will remain immediately due and payable.

 

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20.4                                 Notification of rates of interest

 

The Agent shall promptly notify the relevant Lenders and the relevant Borrower (or the Company) of the determination of a rate of interest under this Agreement.

 

21.                                        INTEREST PERIODS

 

21.1                                 Selection of Interest Periods and Terms

 

21.1.1                      A Borrower (or the Company on behalf of a Borrower) may select an Interest Period for a Loan in the Utilisation Request for that Loan.

 

21.1.2                      Subject to this Clause 21, a Borrower (or the Company) may select an Interest Period of one week or one, three or six months or any other period agreed between the Company and the Agent (acting on the instructions of all the Lenders in relation to the relevant Loan).

 

21.1.3                      An Interest Period for a Loan shall not extend beyond the Termination Date.

 

21.1.4                      A Loan has one Interest Period only.

 

21.2                                 Non-Business Days

 

If an Interest Period would otherwise end on a day which is not a Business Day, that Interest Period will instead end on the next Business Day in that calendar month (if there is one) or the preceding Business Day (if there is not).

 

22.                                        CHANGES TO THE CALCULATION OF INTEREST

 

22.1                                 Absence of quotations

 

Subject to Clause 22.2 (Market disruption) if LIBOR is to be determined by reference to the Base Reference Banks but a Base Reference Bank does not supply a quotation by the Specified Time on the Quotation Day, the applicable LIBOR shall be determined on the basis of the quotations of the remaining Base Reference Banks.

 

22.2                                 Market disruption

 

22.2.1                      If a Market Disruption Event occurs in relation to a Loan for any Interest Period, then the rate of interest on each Lender’s share of that Loan for the Interest Period shall be the percentage rate per annum which is the sum of:-

 

(a)                                          the Margin; and

 

(b)                                          the rate notified to the Agent by that Lender as soon as practicable and in any event by close of business on the date falling two Business Days after the Quotation Day (or, if earlier, on the date falling two Business Days prior to the date on which interest is due to be paid in respect of that Interest Period), to be that which expresses as a percentage rate per annum the cost to that Lender of funding its participation in that Loan from whatever source it may reasonably select.

 

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22.2.2                      If a Market Disruption Event occurs the Agent shall, as soon as is practicable, notify the Company.

 

22.2.3                      If:-

 

(a)                                          the percentage rate per annum notified by a Lender pursuant to Clause 22.2.1(b) above is less than LIBOR; or

 

(b)                                          a Lender has not notified the Agent of a percentage rate per annum pursuant to Clause 22.2.1(b) above,

 

the cost to that Lender of funding its participation in that Loan for that Interest Period shall be deemed, for the purposes of Clause 22.2.1 above, to be LIBOR.

 

22.2.4                      In this Agreement:-

 

Market Disruption Event

 

means:

 

(a)         at or about noon on the Quotation Day for the relevant Interest Period LIBOR is to be determined by reference to the Base Reference Banks and none or only one of the Base Reference Banks supplies a rate to the Agent to determine LIBOR for the relevant currency and Interest Period or

 

(b)         before close of business in London on the Quotation Day for the relevant Interest Period, the Agent receives notifications from a Lender or Lenders (whose participations in a Loan exceed 35 per cent of that Loan) that the cost to it of funding its participation in that Loan from whatever source it may reasonably select would be in excess of LIBOR

 

22.3                                Alternative basis of interest or funding

 

22.3.1                      If a Market Disruption Event occurs and the Agent or the Company so requires, the Agent and the Company shall enter into negotiations (for a period of not more than thirty days) with a view to agreeing a substitute basis for determining the rate of interest.

 

22.3.2                      Any alternative basis agreed pursuant to Clause 22.3.1 above shall, with the prior consent of all the Lenders and the Company, be binding on all Parties.

 

22.4                                 Break Costs

 

22.4.1                      Each Borrower shall, within three Business Days of demand by a Finance Party, pay to that Finance Party its Break Costs attributable to all or any part of a Loan or Unpaid Sum being paid by that Borrower on a day other than the last day of an Interest Period for that Loan or Unpaid Sum.

 

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22.4.2                      Each Lender shall, as soon as reasonably practicable after a demand by the Agent, provide a certificate confirming the amount of its Break Costs for any Interest Period in which they accrue.

 

23.                                        FEES

 

23.1                                 Commitment fee

 

23.1.1                      The Company shall pay to the Agent (for the account of each Lender) a fee in Sterling computed at the rate of 35 per cent of the applicable Margin per annum on that Lender’s Available Commitment for the Availability Period.

 

23.1.2                      The accrued commitment fee is payable on the last day of each successive period of three Months which ends during the Availability Period, on the last day of the Availability Period and, if cancelled in full, on the cancelled amount of the relevant Lender’s Commitment at the time the cancellation is effective.

 

23.2                                 Arrangement fee

 

The Company shall pay to the Arrangers (for their own account) an arrangement fee in the amount and at the times agreed in a Fee Letter.

 

23.3                                 Agency fee

 

The Company shall pay to the Agent (for its own account) an agency fee in the amount and at the times agreed in a Fee Letter.

 

23.4                                 Security Agent fee

 

The Company shall pay to the Security Agent (for its own account) a security agent fee in the amount and at the times agreed in a Fee Letter.

 

23.5                                 Interest, commission and fees on Ancillary Facilities

 

The rate and time of payment of interest, commission, fees and any other remuneration in respect of each Ancillary Facility shall be determined by agreement between the relevant Ancillary Lender and the Borrower of that Ancillary Facility based upon normal market rates and terms (provided that the rate and time of payment of interest, commission, fees and any other remuneration in respect of the same-day access LIBOR facility referred to in clause 15.2.1 shall be on terms no more onerous than the Facility as at the Second Amendment and Restatement Date).

 

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SECTION 6

 

ADDITIONAL PAYMENT OBLIGATIONS

 

24.                                        TAX GROSS UP AND INDEMNITIES

 

24.1                                 Definitions

 

In this Agreement:-

 

Borrower DTTP Filing

 

means an HM Revenue & Customs’ Form DTTP2 duly completed and filed by the Borrower, which:

 

(a)                                 where it relates to a Treaty Lender that is an Original Lender, contains the scheme reference number and jurisdiction of tax residence stated opposite that Lender’s name in Part 2 of Schedule 4 (The Original Parties) and

 

(i)                                     where the Borrower is an Original Borrower, is filed with HM Revenue & Customs; or

 

(ii)                                  where the Borrower is an Additional Borrower, is filed with HM Revenue & Customs within 30 days of the date on which that Borrower becomes an Additional Borrower; or

 

(b)                                 where it relates to a Treaty Lender that is a New Lender or an Increase Lender, contains the scheme reference number and jurisdiction of tax residence stated in respect of that Lender in the relevant Transfer Certificate or Assignment Agreement or Increase Confirmation and

 

(i)                                     where the Borrower is a Borrower as at the relevant Transfer Date (or date on which the increase in Commitments described in the relevant Increase Confirmation takes effect) is filed with HM Revenue & Customs within 30 days of that Transfer Date (or date on which the increase in Commitments described in the relevant Increase Confirmation takes effect); or

 

(ii)                                  where the Borrower is not a Borrower as at the relevant Transfer Date (or date on which the increase in Commitments described in the relevant Increase Confirmation takes effect), is filed with HM Revenue & Customs within 30 days of the date on which that Borrower becomes an Additional Borrower

 

 

 

Protected Party

 

means a Finance Party which is or will be subject to any liability or required to make any payment for or on account of Tax in relation to a sum received or receivable (or any sum deemed for the purposes of Tax to be received or receivable) under a Finance Document

 

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Qualifying Lender

 

means:-

 

(a)                                 a Lender (other than a Lender within sub-clause (b) below) which is beneficially entitled to interest payable to that Lender in respect of an advance under a Finance Document and is:-

 

(i)                                     a Lender:-

 

(A)                               which is a bank (as defined for the purpose of section 879 of the ITA) making an advance under a Finance Document and is within the charge to United Kingdom corporation tax as respects any payments of interest made in respect of that advance or would be within such charge as respects such payments apart from section 18A of the CTA; or

 

(B)                               in respect of an advance made under a Finance Document by a person that was a bank (as defined for the purpose of section 879 of the ITA) at the time that that advance was made, and within the charge to United Kingdom corporation tax as respects any payments of interest made in respect of that advance;

 

(ii)                                  a Lender which is:-

 

(A)                               a company resident in the United Kingdom for United Kingdom tax purposes

 

(B)                               a partnership each member of which is:-

 

(1)                                 a company so resident in the United Kingdom or

 

(2)                                 a company not so resident in the United Kingdom which carries on a trade in the United Kingdom through a permanent establishment and which brings into account in computing its chargeable profits (within the meaning of section 19 of the CTA) the whole of any share of interest payable in respect of that advance that falls to it by reason of Part 17 of the CTA

 

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(C)                               a company not so resident in the United Kingdom which carries on a trade in the United Kingdom through a permanent establishment and which brings into account interest payable in respect of that advance in computing the chargeable profits (within the meaning of section 19 of the CTA) of that company or

 

(iii)                               a Treaty Lender or

 

(b)                                 a Lender which is a building society (as defined for the purposes of section 880 of the ITA) making an advance under a Finance Document

 

 

 

Tax Confirmation

 

means a confirmation by a Lender that the person beneficially entitled to interest payable to that Lender in respect of an advance under a Finance Document is either:-

 

(a)                                 a company resident in the United Kingdom for United Kingdom tax purposes

 

(b)                                 a partnership each member of which is:-

 

(i)                                     a company so resident in the United Kingdom or

 

(ii)                                  a company not so resident in the United Kingdom which carries on a trade in the United Kingdom through a permanent establishment and which brings into account in computing its chargeable profits (within the meaning of section 19 of the CTA) the whole of any share of interest payable in respect of that advance that falls to it by reason of Part 17 of the CTA or

 

(c)                                  a company not so resident in the United Kingdom which carries on a trade in the United Kingdom through a permanent establishment and which brings into account interest payable in respect of that advance in computing the chargeable profits (within the meaning of section 19 of the CTA) of that company

 

 

 

Tax Credit

 

means a credit against, relief or remission for, or repayment of, any Tax

 

 

 

Tax Deduction

 

means a deduction or withholding for or on account of Tax from a payment under a Finance Document, other than a FATCA Deduction

 

 

 

Tax Payment

 

means either the increase in a payment made by an Obligor to a Finance Party under Clause 24.2 (Tax gross-up) or a payment under Clause 24.3 (Tax indemnity)

 

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Treaty Lender

 

means a Lender which:-

 

(a)                                 is treated as a resident of a Treaty State for the purposes of the Treaty and

 

(b)                                 does not carry on a business in the United Kingdom through a permanent establishment with which that Lender’s participation in the Loan is effectively connected

 

 

 

Treaty State

 

means a jurisdiction having a double taxation agreement (a “Treaty”) with the United Kingdom which makes provision for full exemption from tax imposed by the United Kingdom on interest

 

 

 

UK Non-Bank Lender

 

means:-

 

(a)                                 where a Lender becomes a Party on the day on which this Agreement is entered into, a Lender listed in Part 3 of Schedule 4 (The Original Parties); and

 

(b)                                 where a Lender becomes a Party after the day on which this Agreement is entered into, a Lender which gives a Tax Confirmation in the Assignment Agreement or Transfer Certificate which it executes on becoming a Party

 

Unless a contrary indication appears, in this Clause 24 a reference to “determines” or “determined” means a determination made in the absolute discretion of the person making the determination.

 

24.2                                 Tax gross-up

 

24.2.1                      Each Obligor shall make all payments to be made by it without any Tax Deduction, unless a Tax Deduction is required by law.

 

24.2.2                      The Company shall promptly upon becoming aware that an Obligor must make a Tax Deduction (or that there is any change in the rate or the basis of a Tax Deduction) notify the Agent accordingly.  Similarly, a Lender shall notify the Agent on becoming so aware in respect of a payment payable to that Lender.  If the Agent receives such notification from a Lender it shall notify the Company and that Obligor.

 

24.2.3                      If a Tax Deduction is required by law to be made by an Obligor, the amount of the payment due from that Obligor shall be increased to an amount which (after making any Tax Deduction) leaves an amount equal to the payment which would have been due if no Tax Deduction had been required.

 

24.2.4                      A payment shall not be increased under Clause 24.2.3 above by reason of a Tax Deduction on account of Tax imposed by the United Kingdom, if on the date on which the payment falls due:-

 

(a)                                          the payment could have been made to the relevant Lender without a Tax Deduction if the Lender had been a Qualifying Lender, but on that date that Lender is not or has ceased to be a Qualifying Lender other than as a result of any change after the date it became a Lender under this Agreement in (or in the interpretation, administration, or application

 

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of) any law or Treaty or any published practice or published concession of any relevant taxing authority; or

 

(b)                                          the relevant Lender is a Qualifying Lender solely by virtue of sub-clause (a)(ii) of the definition of Qualifying Lender and:-

 

(i)                                              an officer of HM Revenue & Customs has given (and not revoked) a direction (a “Direction”) under section 931 of the ITA which relates to the payment and that Lender has received from the Obligor making the payment or from the Company a certified copy of that Direction; and

 

(ii)                                           the payment could have been made to the Lender without any Tax Deduction if that Direction had not been made; or

 

(c)                                           the relevant Lender is a Qualifying Lender solely by virtue of sub-clause (a)(ii) of the definition of Qualifying Lender and:-

 

(i)                                              the relevant Lender has not given a Tax Confirmation to the Company; and

 

(ii)                                           the payment could have been made to the Lender without any Tax Deduction if the Lender had given a Tax Confirmation to the Company, on the basis that the Tax Confirmation would have enabled the Company to have formed a reasonable belief that the payment was an “excepted payment” for the purpose of section 930 of the ITA; or

 

(d)                                          the relevant Lender is a Treaty Lender and the Obligor making the payment is able to demonstrate that the payment could have been made to the Lender without the Tax Deduction had that Lender complied with its obligations under Clauses 24.2.7  or 24.2.8 (as applicable) below.

 

24.2.5                      If an Obligor is required to make a Tax Deduction, that Obligor shall make that Tax Deduction and any payment required in connection with that Tax Deduction within the time allowed and in the minimum amount required by law.

 

24.2.6                      Within thirty days of making either a Tax Deduction or any payment required in connection with that Tax Deduction, the Obligor making that Tax Deduction shall deliver to the Agent for the Finance Party entitled to the payment a statement under section 975 of the ITA or other evidence reasonably satisfactory to that Finance Party that the Tax Deduction has been made or (as applicable) any appropriate payment paid to the relevant taxing authority.

 

24.2.7

 

(a)                                          Subject to paragraph (b) below, a Treaty Lender and each Obligor which makes a payment to which that Treaty Lender is entitled shall co-operate in completing any procedural formalities necessary for that Obligor to obtain authorisation to make that payment without a Tax Deduction.

 

(b)

 

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(i)                                              A Treaty Lender which becomes a Party on the day on which this Agreement is entered into that holds a passport under the HMRC DT Treaty Passport scheme, and which wishes that scheme to apply to this Agreement, shall confirm its scheme reference number and its jurisdiction of tax residence opposite its name in Part 2 of Schedule 4 (The Original Parties); and

 

(ii)                                           A New Lender or an Increase Lender that is a Treaty Lender that holds a passport under the HMRC DT Treaty Passport scheme, and which wishes that scheme to apply to this Agreement, shall confirm its scheme reference number and its jurisdiction of tax residence in the Transfer Certificate, Assignment Agreement or Increase Confirmation which it executes,

 

and, having done so, that Lender shall be under no obligation pursuant to Clause 24.2.7(a) above.

 

24.2.8                      If a Lender has confirmed its scheme reference number and its jurisdiction of tax residence in accordance with Clause 24.2.7(b) above and:

 

(a)                                          the Borrower making a payment to that Lender has not made a Borrower DTTP Filing in respect of that Lender; or

 

(b)                                          the Borrower making a payment to that Lender has made a Borrower DTTP Filing in respect of that Lender but:

 

(i)                                              the Borrower DTTP Filing has been rejected by HM Revenue & Customs; or

 

(ii)                                           HM Revenue & Customs has not given the Borrower authority to make payments to that Lender without a Tax Deduction within 60 days of the date of the Borrower DTTP Filing,

 

and in each case, the Borrower has notified that Lender in writing, that Lender and the Borrower shall co-operate in completing any additional procedural formalities necessary for the Company to obtain authorisation to make that payment without a Tax Deduction.

 

24.2.9                      If a Lender has not confirmed its scheme reference number and jurisdiction of tax residence in accordance with Clause 24.2.7(b) above, no Obligor shall make a Borrower DTTP Filing or file any other form relating to the HMRC DT Treaty Passport scheme in respect of that Lender’s Commitment(s) or its participation in any Loan unless the Lender otherwise agrees.

 

24.2.10               The Company shall, promptly on making a Borrower DTTP Filing, deliver a copy of that Borrower DTTP Filing to the Agent for delivery to the relevant Lender.

 

24.2.11               A UK Non-Bank Lender which becomes a Party on the day on which this Agreement is entered into gives a Tax Confirmation to the Company by entering into this Agreement.

 

24.2.12               A UK Non-Bank Lender shall promptly notify the Company and the Agent if there is any change in the position from that set out in the Tax Confirmation.

 

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24.3                                 Tax indemnity

 

24.3.1                      The Company shall (within three Business Days of demand by the Agent) pay to a Protected Party an amount equal to the loss, liability or cost which that Protected Party determines will be or has been (directly or indirectly) suffered for or on account of Tax by that Protected Party in respect of a Finance Document.

 

24.3.2                      Clause 24.3.1 above shall not apply:-

 

(a)                                          with respect to any Tax assessed on a Finance Party:-

 

(i)                                              under the law of the jurisdiction in which that Finance Party is incorporated or, if different, the jurisdiction (or jurisdictions) in which that Finance Party is treated as resident for tax purposes; or

 

(ii)                                           under the law of the jurisdiction in which that Finance Party’s Facility Office is located in respect of amounts received or receivable in that jurisdiction,

 

if that Tax is imposed on or calculated by reference to the net income received or receivable (but not any sum deemed to be received or receivable) by that Finance Party; or

 

(b)                                          to the extent a loss, liability or cost:-

 

(i)                                              is compensated for by an increased payment under Clause 24.2 (Tax gross-up);

 

(ii)                                           would have been compensated for by an increased payment under Clause 24.2 (Tax gross-up) but was not so compensated solely because one of the exclusions in Clause 24.2.4 applied; or

 

(iii)                                        relates to a FATCA Deduction required to be made by a Party.

 

24.3.3                      A Protected Party making, or intending to make a claim under Clause 24.3.1 above shall promptly notify the Agent of the event which will give, or has given, rise to the claim, following which the Agent shall notify the Company.

 

24.3.4                      A Protected Party shall, on receiving a payment from an Obligor under this Clause 24.3, notify the Agent.

 

24.4                                 Tax Credit

 

If an Obligor makes a Tax Payment and the relevant Finance Party determines that:-

 

24.4.1                      a Tax Credit is attributable to an increased payment of which that Tax Payment forms part, to that Tax Payment or to a Tax Deduction in consequence of which that Tax Payment was required; and

 

24.4.2                      that Finance Party has obtained and utilised that Tax Credit,

 

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the Finance Party shall pay an amount to the Obligor which that Finance Party determines will leave it (after that payment) in the same after-Tax position as it would have been in had the Tax Payment not been required to be made by the Obligor.

 

24.5                                 Lender Status Confirmation

 

Each Lender which becomes a Party to this Agreement after the date of this Agreement shall indicate, in the Transfer Certificate, Assignment Agreement or Increase Confirmation which it executes on becoming a Party, and for the benefit of the Agent and without liability to any Obligor, which of the following categories it falls in:-

 

24.5.1                      not a Qualifying Lender;

 

24.5.2                      a Qualifying Lender (other than a Treaty Lender); or

 

24.5.3                      a Treaty Lender.

 

If a New Lender or Increase Lender fails to indicate its status in accordance with this Clause 24.5 then such New Lender or Increase Lender shall be treated for the purposes of this Agreement (including by each Obligor) as if it is not a Qualifying Lender until such time as it notifies the Agent which category applies (and the Agent, upon receipt of such notification, shall inform the Company).  For the avoidance of doubt, a Transfer Certificate, Assignment Agreement or Increase Confirmation shall not be invalidated by any failure of a Lender to comply with this Clause 24.5.

 

24.6                                 Stamp taxes

 

The Company shall pay and, within three Business Days of demand, indemnify each Secured Party against any cost, loss or liability that Secured Party incurs in relation to all stamp duty, registration and other similar Taxes payable in respect of any Finance Document.

 

24.7                                 VAT

 

24.7.1                      All amounts expressed to be payable under a Finance Document by any Party to a Finance Party which (in whole or in part) constitute the consideration for any supply for VAT purposes are deemed to be exclusive of any VAT which is chargeable on that supply, and accordingly, subject to Clause 24.7.2 below, if VAT is or becomes chargeable on any supply made by any Finance Party to any Party under a Finance Document and such Finance Party is required to account to the relevant tax authority for the VAT, that Party must pay to such Finance Party (in addition to and at the same time as paying any other consideration for such supply) an amount equal to the amount of the VAT (and such Finance Party must promptly provide an appropriate VAT invoice to that Party).

 

24.7.2                      If VAT is or becomes chargeable on any supply made by any Finance Party (the “Supplier”) to any other Finance Party (the “Recipient”) under a Finance Document, and any Party other than the Recipient (the “Relevant Party”) is required by the terms of any Finance Document to pay an amount equal to the consideration for that supply to the Supplier (rather than being required to reimburse or indemnify the Recipient in respect of that consideration):

 

(a)                                          (where the Supplier is the person required to account to the relevant tax authority for the VAT) the Relevant Party must also pay to the Supplier (at the same time as paying that amount) an additional amount equal to the amount of the VAT.  The Recipient must (where

 

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this Clause 24.7.2(a) applies) promptly pay to the Relevant Party an amount equal to any credit or repayment the Recipient receives from the relevant tax authority which the Recipient reasonably determines relates to the VAT chargeable on that supply; and

 

(b)                                          (where the Recipient is the person required to account to the relevant tax authority for the VAT) the Relevant Party must promptly, following demand from the Recipient, pay to the Recipient an amount equal to the VAT chargeable on that supply but only to the extent that the Recipient reasonably determines that it is not entitled to credit or repayment from the relevant tax authority in respect of that VAT.

 

24.7.3                      Where a Finance Document requires any Party to reimburse or indemnify a Finance Party for any cost or expense, that Party shall reimburse or indemnify (as the case may be) such Finance Party for the full amount of such cost or expense, including such part thereof as represents VAT, save to the extent that such Finance Party reasonably determines that it is entitled to credit or repayment in respect of such VAT from the relevant tax authority.

 

24.7.4                      Any reference in this Clause 24.7 to any Party shall, at any time when such Party is treated as a member of a group for VAT purposes, include (where appropriate and unless the context otherwise requires) a reference to the representative member of such group at such time (the term “representative member” to have the same meaning as in the Value Added Tax Act 1994).

 

24.7.5                      I