exv10w1







Exhibit 10.1



Dated 21 May 2008



 




	(1)	 	BELL MICROPRODUCTS LIMITED
and BELL MICROPRODUCTS EUROPE EXPORT LIMITED as
Borrowers
	 
	(2)	 	BELL MICROPRODUCTS EUROPE (HOLDINGS) B.V.
	 
	(3)	 	BM EUROPE PARTNERS C.V.
	 
	(4)	 	BELL MICROPRODUCTS EUROPE B.V.
	 
	(5)	 	BANK OF AMERICA, NATIONAL ASSOCIATION as
Arranger, Issuer, Swingline Lender, Agent and
Security Trustee
	 
	(6)	 	THE COMPANIES NAMED HEREIN as Guarantors
	 
	(7)	 	CERTAIN BANKS AND FINANCIAL INSTITUTIONS as
Lenders




 
 




NINTH SUPPLEMENTAL AGREEMENT

in relation to a syndicated credit agreement dated

2 December 2002 (as amended and/or restated from

time to time)



 
 




CMS Cameron McKenna LLP

Mitre House

160 Aldersgate Street

London EC1A 4DD




T +44(0)20 7367 3000

F +44(0)20 7367 2000




Ref: DOCL/0Z2950.01541




 









 








Table of Contents




	 	 	 	 	 	 	 
	1.

	 	Definitions and interpretation
	 	 	2	 
	 

	 	Definitions
	 	 	2	 
	 

	 	Incorporation of defined terms
	 	 	2	 
	 

	 	Certain references
	 	 	2	 
	 

	 	Headings
	 	 	2	 
	2.

	 	Amendment and restatement of the Credit Agreement
	 	 	2	 
	3.

	 	Effective Date and Longstop Date
	 	 	3	 
	 

	 	Effective Date
	 	 	3	 
	 

	 	Long Stop Date
	 	 	3	 
	 

	 	Completion Conditions
	 	 	3	 
	4.

	 	Representations and warranties
	 	 	3	 
	 

	 	Representations and warranties of the Obligors
	 	 	3	 
	 

	 	Representations and warranties in Credit Agreement
	 	 	3	 
	 

	 	Corporate power
	 	 	3	 
	 

	 	No conflict with other obligations
	 	 	4	 
	 

	 	Consents obtained
	 	 	4	 
	 

	 	Constitutional Documents
	 	 	4	 
	 

	 	No filings required
	 	 	4	 
	 

	 	Repetition
	 	 	4	 
	5.

	 	Further assurance and construction
	 	 	5	 
	 

	 	Further assurance
	 	 	5	 
	 

	 	Construction
	 	 	5	 
	6.

	 	Affirmation and confirmation
	 	 	5	 
	 

	 	Affirmation
	 	 	5	 
	 

	 	Confirmation by Guarantors
	 	 	5	 
	 

	 	Confirmation by BMEH
	 	 	5	 
	7.

	 	Fees, costs and expenses
	 	 	5	 
	 

	 	Renewal Fee
	 	 	5	 
	 

	 	Transaction Expenses
	 	 	5	 
	 

	 	Preservation and enforcement of rights
	 	 	6	 
	 

	 	Stamp duties etc.
	 	 	6	 
	8.

	 	Miscellaneous
	 	 	6	 
	 

	 	Counterparts
	 	 	6	 
	 

	 	Designation
	 	 	6	 
	 

	 	Incorporation of terms
	 	 	6	 
	 
	 	 	 	 	 	 
	Schedule 1	 	 	7	 
	 	 
	 

	 	The Guarantors
	 	 	7	 
	 
	 	 	 	 	 	 
	Schedule 2	 	 	8	 
	 	 
	 

	 	The Lenders
	 	 	8	 
	 
	 	 	 	 	 	 
	Schedule 3	 	 	9	 
	 
	 	 	 	 	 	 
	 

	 	Conditions Precedent	 	 	9	 







 












 








THIS SUPPLEMENTAL AGREEMENT is dated 21 May 2008 and made BETWEEN:





	(1)	 	BELL MICROPRODUCTS LIMITED (previously named IDEAL HARDWARE LIMITED) (Company Number:
03969946) whose registered office is at Cox Lane, Chessington, Surrey, KT9 1SJ (“BMUK”) and
BELL MICROPRODUCTS EUROPE EXPORT LIMITED (Company Number: 03711148) whose registered office is
at Cox Lane, Chessington, Surrey, KT9 1SJ (“BMEE”) (each a “Borrower” and together the
“Borrowers”);
	 
	(2)	 	BELL MICROPRODUCTS EUROPE (HOLDINGS) B.V. a private company with limited liability (besloten
vennootschap met beperkte aansprakelijkheid) incorporated under the laws of the Netherlands,
having its official seat in Almere, the Netherlands and its registered office at Veluwezoom
42-50, 1327 AH Almere, the Netherlands and registered in the Commercial Register under number
39087200 (“BMEH”);
	 
	(3)	 	BM EUROPE PARTNERS C.V. a limited partnership (commanditaire vennootschap) established under
the laws of the Netherlands, having its official seat in Almere, the Netherlands and its
registered office at Veluwezoom 42-50, 1327 AH Almere, the Netherlands and registered in the
Commercial Register under number 04065637 (“BMEP”);
	 
	(4)	 	BELL MICROPRODUCTS EUROPE B.V. a private company with limited liability (besloten
vennootschap met beperkte aansprakelijkheid) incorporated under the laws of the Netherlands,
having its official seat in Emmen, the Netherlands and its registered office at Veluwezoom
42-50, 1327 AH Almere, the Netherlands and registered in the Commercial Register under number
04064633 (“BMEBV”);
	 
	(5)	 	BANK OF AMERICA, NATIONAL ASSOCIATION acting through its London branch at 5 Canada Square,
London, E14 5AQ in its capacity as arranger (the “Arranger”), in its capacity as agent for the
Lenders (the “Agent”), in its capacity as the Lender making Swingline Loans (the “Swingline
Lender”), in its capacity as the Lender issuing any Letter of Credit or Guarantee (the
“Issuer”), in its capacity as security trustee under the Security Documents (the “Security
Trustee”);
	 
	(6)	 	THE COMPANIES named in Schedule 1 (The Guarantors) (the “Guarantors”); and
	 
	(7)	 	THE BANKS AND FINANCIAL INSTITUTIONS named in Schedule 2 (The Lenders) (the “Lenders”).





WHEREAS:





	(A)	 	By a syndicated credit agreement (as amended and restated, the “Credit Agreement”) dated 2
December 2002 between (1) BMUK (then called “Ideal Hardware Limited”) and Bell Microproducts
Europe Export Limited (as Original Borrowers), (2) BM Europe Partners C.V., (3) Bell
Microproducts Europe B.V., (4) Bank of America, National Association (as Arranger, Issuer,
Swingline Lender, Agent and Security Trustee) and (5) certain banks and financial institutions
(as Lenders), the Lenders agreed to make available to the Original Borrowers a revolving
credit facility of up to £75,000,000.






	(B)	 	By supplemental agreements (together, the “Supplemental Agreements”) dated 3 December 2003,
22 September 2004, 15 December 2004, 17 March 2005, 16 August 2005, 20 October 2005, 31
January 2006 and 2 January 2007 between, among others, the parties to the Credit Agreement,
the parties to the Credit Agreement agreed to amend and/or restate the Credit Agreement on the
terms respectively set out therein including an increase in the facility to up to £80,000,000.




 









 












	(C)	 	This Supplemental Agreement is entered into in order to reflect the terms and conditions on
and subject to which the Revolving Facility is to be extended and the decrease of the facility
to up to £76,000,000.





IT IS AGREED THAT:





	1.	 	Definitions and interpretation
	 
	 	 	Definitions
	 
	1.1	 	In this Supplemental Agreement, unless the context otherwise requires:
	 
	 	 	“Fee letter” means any letter or letters dated on or about the date of this
Supplemental Agreement between the Arranger and BMUK setting out any of the fees referred
to in Clause 7 (Fees, costs and expenses); and
	 
	 	 	“Restated Agreement” means the Credit Agreement, as amended and restated by this
Deed, the terms of which are set out in Exhibit “A” (Form of Restated Agreement);
	 
	 	 	“Supplemental Agreement”: this ninth supplemental agreement.
	 
	 	 	Incorporation of defined terms
	 
	1.2	 	Terms defined in the Credit Agreement shall, unless otherwise defined in this Supplemental
Agreement, have the same meaning when used in this Supplemental Agreement and the principles
of construction set out in Clauses 1.2 to 1.13 (inclusive) of the Credit Agreement shall have
effect, mutatis mutandis, as if set out in this Supplemental Agreement in full.
	 
	 	 	Certain references
	 
	1.3	 	In this Supplemental Agreement references to Clauses, Schedules and the Exhibit are, unless
the context otherwise requires, to be construed as references to the clauses of, and schedules
and the exhibit to, this Supplemental Agreement and references to this Supplemental Agreement
include its schedules and the exhibit.
	 
	 	 	Headings
	 
	1.4	 	Clause headings and the table of contents are inserted for convenience of reference only and
shall be ignored in the interpretation of this Supplemental Agreement.
	 
	2.	 	Amendment and restatement of the Credit Agreement
	 
	2.1	 	With effect from the Effective Date, the Credit Agreement shall be amended and restated so
that it shall be read and construed for all purposes as set out in Exhibit “A” (Form of
Restated Agreement).
	 
	2.2	 	Each Lender acknowledges and agrees that, on and with effect from the Effective Date, its
Commitment is as stated in Schedule 2 (The Lenders).




2









 












	3.	 	Effective Date and Longstop Date
	 
	 	 	Effective Date






	3.1	 	This Deed shall take effect on and with effect from the date (the “Effective Date”) on which
the Agent notifies the Borrower that all of the following conditions shall have been
satisfied:






	 	3.1.1	 	the Agent has received each of the documents listed in Schedule 3
(Conditions Precedent) in form and substance satisfactory to the Agent;
	 
	 	3.1.2	 	the Agent is satisfied that no Default has occurred and is continuing or
would occur by reason of the Effective Date occurring;
	 
	 	3.1.3	 	the Agent is satisfied that none of the representations and warranties in
Clause 7 (Representations and Warranties) are untrue or incorrect as at such date as
if made on such date with respect to the facts and circumstances existing at such
date; and
	 
	 	3.1.4	 	the Agent has received payment of the fees and expenses referred to in
Clause 7 (Fees, costs and expenses) to the extent that invoices in respect of the
same shall have been rendered at that date.






	 	 	Long Stop Date
	 
	3.2	 	If the Effective Date has not occurred on or before 30 June 2008, then the provisions of this
Deed (other than Clause 7 (Fees, Costs and Expenses) and Clause 11 (Miscellaneous)) shall
thereupon cease to have effect.
	 
	 	 	Completion Conditions
	 
	3.3	 	The Agent shall not give notice of the occurrence of the Effective Date under Clause 4.1
(Effective Date) (unless expressly instructed in writing by the Majority Lenders to do so) if,
on the Effective Date, the Agent has received actual knowledge that an Event of Default has
occurred and is continuing or that any of the representations and warranties in Clause 5
(Representations and Warranties) are untrue or incorrect in any material respect as at such
date as if made on such date with respect to the facts and circumstances existing at such
date.
	 
	4.	 	Representations and warranties
	 
	 	 	Representations and warranties of the Obligors
	 
	4.1	 	Each Obligor represents and warrants (in respect of itself and each other Obligor) to and for
the benefit of each other party to this Supplemental Agreement that:
	 
	 	 	Representations and warranties in Credit Agreement






	 	4.1.1	 	the representations and warranties set out in Clauses 14.1 (General
Representations and Warranties) and 14.2 (Accounts) of the Credit Agreement are true
and correct as if made at the date of this Supplemental Agreement and on the
Effective Date with reference to the facts and circumstances existing at each such
date;






	 	 	Corporate power






	 	4.1.2	 	it has power to execute, deliver and perform its obligations under this
Supplemental Agreement; all necessary corporate, shareholder and other action has
been taken to




3









 






	 	 	 	authorise the execution, delivery and performance of the same and this
Supplemental Agreement constitutes valid and legally binding obligations of such
Obligor enforceable in accordance with their respective terms;






	 	 	No conflict with other obligations






	 	4.1.3	 	the execution and delivery of, the performance of its obligations under,
and compliance with the provisions of this Supplemental Agreement by such Obligor
will not (i) contravene any existing applicable law, statute, rule or regulation or
any judgment, decree or permit to which such Obligor is subject, (ii) to an extent or
in a manner which has or could have a material adverse effect on it, conflict with,
or result in any breach of any of the terms of, or constitute a default under, any
agreement or other instrument to which such Obligor is a party or is subject or by
which it or any of its property is bound, or (iii) contravene or conflict with any
provision of such Obligor’s Memorandum and Articles of Association, Articles of
Incorporation/Bye-laws/Statutes or other constitutional documents;






	 	 	Consents obtained






	 	4.1.4	 	every consent, authorisation, licence or approval of, or registration with
or declaration to, governmental or public bodies or authorities or courts required by
such Obligor to authorise, or required by such Obligor in connection with, the
execution, delivery, validity, enforceability or admissibility in evidence of this
Supplemental Agreement or the performance by such Obligor of its obligations under
this Supplemental Agreement has been obtained or made and is in full force and effect
and there has been no default in the observance of the conditions or restrictions (if
any) imposed in, or in connection with, any of the same;






	 	 	Constitutional Documents






	 	4.1.5	 	there has been no change to the constitutional documents of any Obligor
since the same were last delivered to the Agent;






	 	 	No filings required






	 	4.1.6	 	it is not necessary to ensure the legality, validity, enforceability or
admissibility in evidence of this Supplemental Agreement that it or any other
instrument be notarised, filed, recorded, registered or enrolled in any court, public
office or elsewhere in the jurisdiction in which such Obligor is incorporated or has
its principal place of business or that any stamp, registration or similar tax or
charge be paid in any such jurisdiction on or in relation to this Supplemental
Agreement and this Supplemental Agreement is in proper form for its enforcement in
the courts of such jurisdiction.






	 	 	Repetition






	4.2	 	The representations and warranties in Clause 4.1 (Representation and Warranties of the
Obligors) shall be deemed to be repeated by each Obligor on each date on which a Loan is
requested or is to be made (or, as the case may be, a Letter of Credit is issued or requested
to be issued) and on each date on which a Prepayment is made under an Invoice Discounting
Agreement as if made with reference to the facts and circumstances existing on each such date.




4









 












	5.	 	Further assurance and construction
	 
	 	 	Further assurance
	 
	5.1	 	Each Obligor shall, at the request of the Agent and at its own expense, do all such acts and
things necessary to give effect to this Supplemental Agreement.
	 
	 	 	Construction
	 
	5.2	 	With effect from the Effective Date, the Credit Agreement and this Supplemental Agreement
shall be read and construed as a single instrument and references to the Credit Agreement in
the Credit Agreement and each of the Finance Documents shall be read and construed as
references to the Credit Agreement as amended by this Supplemental Agreement.
	 
	6.	 	Affirmation and confirmation
	 
	 	 	Affirmation
	 
	6.1	 	Each Obligor confirms to the Beneficiaries that, unless specifically amended in accordance
with the terms of this Supplemental Agreement, each Finance Document to which it is a party
will remain in full force and effect without novation and will continue to constitute its
legal, valid and binding obligations enforceable in accordance with their respective terms and
each of the security interests created by the Security Documents will continue in full force
and effect.
	 
	 	 	Confirmation by Guarantors
	 
	6.2	 	Each Guarantor confirms that its guarantee obligations under Clause 13 (Guarantee) of the
Credit Agreement, Clause 7 (Guarantee) of the Supplemental Agreement dated 15 December 2004
or, as the case may be, the Security Documents shall remain in full force and effect without
novation in respect of the Obligors’ obligations under the Credit Agreement and under each
other Finance Document.
	 
	 	 	Confirmation by BMEH
	 
	6.3	 	BMEH further confirms that its obligations under the Credit Agreement shall remain in full
force and effect in respect of the Obligors’ obligations under the Credit Agreement and under
each other Finance Document.
	 
	7.	 	Fees, costs and expenses
	 
	 	 	Renewal Fee
	 
	7.1	 	BMUK shall pay to the Arranger a renewal fee in the amount and at the time agreed in the Fee
Letter.
	 
	 	 	Transaction Expenses
	 
	7.2	 	BMUK shall, from time to time on demand of the Agent, reimburse the Agent for all costs and
expenses (including legal fees) together with any VAT thereon incurred by the Agent, the
Security Trustee or the Receivables Purchaser in connection with the negotiation, preparation
and execution of this Supplemental Agreement, any other document referred to in this
Supplemental Agreement and the completion of the transactions contemplated by this
Supplemental Agreement.




5









 






	 	 	Preservation and enforcement of rights
	 
	7.3	 	Each Obligor shall, from time to time on demand of the Agent, reimburse the Beneficiaries for
all costs and expenses (including legal fees) on a full indemnity basis together with any VAT
thereon incurred in or in connection with the preservation and/or enforcement of any of the
rights of the Beneficiaries under this Supplemental Agreement and any other document referred
to in this Supplemental Agreement.
	 
	 	 	Stamp duties etc.
	 
	7.4	 	Each Obligor shall pay all stamp, registration and other taxes to which this Supplemental
Agreement, any other document referred to in this Supplemental Agreement or any judgement
given in connection with this Supplemental Agreement is or at any time may be subject and
shall, from time to time on demand of the Agent, indemnify the Beneficiaries against any
liabilities, costs, claims and expenses resulting from any failure to pay or any delay in
paying any such tax.
	 
	8.	 	Miscellaneous
	 
	 	 	Counterparts
	 
	8.1	 	This Supplemental Agreement may be executed in any number of counterparts, all of which taken
together shall constitute one and the same instrument.
	 
	 	 	Designation
	 
	8.2	 	This Supplemental Agreement is hereby designated a Finance Document.
	 
	 	 	Incorporation of terms
	 
	8.3	 	The provisions of clause 32 (Notices) and clause 35 (Law and Jurisdiction) of the Credit
Agreement shall be incorporated in this Supplemental Agreement as if set out in full, mutatis
mutandis, in this Supplemental Agreement and as if references in such clauses to “this
Agreement” were references to this Supplemental Agreement.




IN WITNESS of which this Supplemental Agreement has been executed and delivered by or on behalf of
the parties on the date stated at the beginning of this Supplemental Agreement.




6









 








Schedule 1



The Guarantors




	 	 	 
	Name	 	Company Number
	Bell Microproducts Limited
	 	03969946
	Bell Microproducts Europe Export Limited
	 	03711148
	Bell Microproducts Europe B.V.
	 	4064633
	Bell Microproducts S.a.r.l (a company incorporated under the laws of France) 
	 	43474497500013
	Bell Microproducts BVBA (a company incorporated under the laws of Belgium) 
	 	0474128872
	Bell Microproducts S.r.l (a company incorporated under the laws of Italy) 
	 	13456670150
	Bell Microproducts (US) Limited
	 	05305904
	Bell Microproducts Europe (Holdings) BV
	 	39087200
	Bell Europe Partners CV
	 	 






7









 






Schedule 2




The Lenders




	 	 	 	 	 
	Lender
	 	Commitment (£)	 
	Bank of America, National Association
	 	 	50,000,000	 
	Lloyds TSB Commercial Finance Limited
	 	 	20,000,000	 
	Enterprise Finance Europe (UK) Limited
	 	 	6,000,000	 






8









 






Schedule 3




Conditions Precedent





	1.	 	In relation to each Obligor:
	 
	1.1	 	a certificate of its company secretary or, if it has no company secretary, one of its
directors or other officers, confirming that such company’s memorandum and articles of
association and certificate(s) of incorporation and incorporation on change of name have not
been amended since the date they were last delivered to the Agent;
	 
	1.2	 	a copy, certified as at the date of this Supplemental Agreement a true and up-to-date copy by
one of its directors or its company secretary, of a board resolution of such company approving
its execution, delivery and performance of this Supplemental Agreement and its terms and
conditions and any documents to be delivered by it pursuant to this Supplemental Agreement and
authorising a named person or persons or a designated category of officer to sign this
Supplemental Agreement and any documents to be delivered by it pursuant to this Supplemental
Agreement on its behalf; and
	 
	1.3	 	a certificate of its company secretary or, if it has no company secretary, one of its
directors or other officers confirming that the names and signatures of the persons authorised
to sign, on behalf of such company, this Supplemental Agreement and any documents to be
delivered by it pursuant to this Supplemental Agreement have not changed from those set out in
the certificate setting out such names and signatures delivered to the Agent on or about 2
January 2007.
	 
	2.	 	This Supplemental Agreement, duly executed by the parties thereto.
	 
	3.	 	A certificate of the finance director of BMUK (together with such additional information or
evidence as the Agent may reasonably require) confirming, among other matters, (A) that no
Default has occurred and is continuing and (B) the level of current creditors’ days
outstanding together with confirmation that the largest twenty (20) trade creditors of the
Group are being paid in accordance with the credit terms prevailing between such parties.
	 
	4.	 	The Fee Letter (2008) duly signed by BMUK.
	 
	5.	 	Such other documents and evidence as the Agent may require.




9









 











Supplemental Agreement



THE BORROWERS




	 	 	 
	SIGNED for and on behalf of
	 	)
	BELL MICROPRODUCTS LIMITED
	 	)
	by: /s/ Nicholas Lee
	 	 






	 	 	 	 	 
	Address:

	 	Cox Lane
	 	 
	 

	 	Chessington	 	 
	 

	 	Surrey KT9 1SJ	 	 
	Fax:

	 	+44 (0)20 8286 5588	 	 
	Attention:

	 	Nick Lee/Helen Hancock	 	 






	 	 	 
	SIGNED for and on behalf of
	 	)
	BELL MICROPRODUCTS EUROPE
	 	)
	EXPORT LIMITED by: /s/ Nicholas Lee
	 	)






	 	 	 	 	 
	Address:

	 	Cox Lane
	 	 
	 

	 	Chessington	 	 
	 

	 	Surrey KT9 1SJ	 	 
	Fax:

	 	+44 (0)20 8286 5588	 	 
	Attention:

	 	Nick Lee/Helen Hancock	 	 
	 
	 	 	 	 
	THE DUTCH OBLIGORS
	 	 	 	 






	 	 	 
	SIGNED by its Managing Partner
	 	)
	for and on behalf of
	 	)
	BM EUROPE PARTNERS C.V.
	 	)
	/s/ Graeme Watt
	 	 






	 	 	 	 	 
	Address:

	 	Cox Lane
	 	 
	 

	 	Chessington	 	 
	 

	 	Surrey KT9 1SJ	 	 
	Fax:

	 	+44 (0)20 8286 5588	 	 
	Attention:

	 	Nick Lee/Helen Hancock	 	 






BELL MICROPRODUCTS EUROPE (HOLDINGS) B.V.




	 	 	 
	SIGNED for and on behalf of
	 	)
	BELL MICROPRODUCTS
	 	)
	EUROPE (HOLDINGS) B.V. by: /s/ Nicholas Lee
	 	)






	 	 	 	 	 
	Address:

	 	Cox Lane
	 	 
	 

	 	Chessington	 	 
	 

	 	Surrey KT9 1SJ	 	 
	Fax:

	 	+44 (0)20 8286 5588	 	 
	Attention:

	 	Nick Lee/Helen Hancock	 	 






BELL MICROPRODUCTS EUROPE B.V.




	 	 	 
	SIGNED for and on behalf of
	 	)
	BELL MICROPRODUCTS
	 	)
	EUROPE B.V. by:  /s/ Nicholas Lee
	 	)






10









 






	 	 	 	 	 
	Address:

	 	Cox Lane
	 	 
	 

	 	Chessington	 	 
	 

	 	Surrey KT9 1SJ	 	 
	Fax:

	 	+44 (0)20 8286 5588	 	 
	Attention:

	 	Nick Lee/Helen Hancock	 	 






	 	 	 
	THE GUARANTORS
	 	 
	 
	 	 
	SIGNED for and on behalf of
	 	)
	BELL MICROPRODUCTS LIMITED by: /s/ Nicholas Lee
	)






	 	 	 	 	 
	Address:

	 	Cox Lane
	 	 
	 

	 	Chessington	 	 
	 

	 	Surrey, KT9 1SS	 	 
	Fax:

	 	020 8286 5588	 	 
	Attention:

	 	Nick Lee/Helen Hancock	 	 






	 	 	 
	SIGNED for and on behalf of
	 	)
	BELL MICROPRODUCTS EUROPE
	 	)
	EXPORT LIMITED by: /s/ Nicholas Lee
	 	)






	 	 	 	 	 
	Address:

	 	Cox Lane
	 	 
	 

	 	Chessington	 	 
	 

	 	Surrey, KT9 1SS	 	 
	Fax:

	 	020 8286 5588	 	 
	Attention:

	 	Nick Lee/Helen Hancock	 	 






	 	 	 
	SIGNED for and on behalf of
	 	)
	BELL MICROPRODUCTS EUROPE B.V.
	)
	acting by its Managing Director: /s/ Nicholas Lee
	 	)






	 	 	 	 	 
	Address:

	 	Cox Lane
	 	 
	 

	 	Chessington	 	 
	 

	 	Surrey, KT9 1SS	 	 
	Fax:

	 	020 8286 5588	 	 
	Attention:

	 	Nick Lee/Helen Hancock	 	 






	 	 	 
	SIGNED for and on behalf of
	 	)
	BELL MICROPRODUCTS S.A.R.L. by /s/ Nicholas Lee
	 	)
	in the presence of:
	 	)






	 
	Witness Helen Hancock

	 

	Signature: /s/ Helen Hancock

	Name:

	Occupation: Solicitor

	Address: As below







	 	 	 	 	 
	Address:

	 	Cox Lane
	 	 
	 

	 	Chessington	 	 
	 

	 	Surrey, KT9 1SS	 	 
	Fax:

	 	020 8286 5588	 	 
	Attention:

	 	Nick Lee/Helen Hancock	 	 






11









 






	 	 	 
	SIGNED for and on behalf of
	 	)
	BELL MICROPRODUCTS BVBA by /s/ Nicholas Lee
	 	)
	in the presence of
	 	)






	 
	Witness Helen Hancock

	 

	Signature: /s/ Helen Hancock

	Name:

	Occupation: Solicitor

	Address: See below







	 	 	 	 	 
	Address: 





Fax: 

Attention:

	 	Cox Lane

Chessington

Surrey, KT9 1SS

020 8286 5588

Nick Lee/Helen Hancock
	 	 






	 	 	 
	SIGNED for and on behalf of
	 	)
	BELL MICROPRODUCTS S.R.L. by /s/ Nicholas Lee
	 	)
	in the presence of
	 	)






	 
	Witness Helen Hancock

	 

	Signature: /s/ Helen Hancock

	Name:

	Occupation: Solicitor

	Address: As below







	 	 	 	 	 
	Address:

	 	Cox Lane
	 	 
	 

	 	Chessington	 	 
	 

	 	Surrey, KT9 1SS	 	 
	Fax:

	 	020 8286 5588	 	 
	Attention:

	 	Nick Lee/Helen Hancock	 	 






	 	 	 
	SIGNED for and on behalf of
	 	)
	BELL MICROPRODUCTS (US) LIMITED
	)
	by: /s/ Nicholas Lee
	 	)






	 	 	 	 	 
	Address:

	 	Cox Lane
	 	 
	 

	 	Chessington	 	 
	 

	 	Surrey, KT9 1SS	 	 
	Fax:

	 	020 8286 5588	 	 
	Attention:

	 	Nick Lee/Helen Hancock	 	 






12









 






	 	 	 
	THE AGENT
	 	 
	 
	 	 
	SIGNED for and on behalf of
	 	)
	BANK OF AMERICA, NATIONAL
	 	)
	ASSOCIATION by: /s/ Lee Masters
	 	)






	 	 	 	 	 
	Address:

	 	5 Canada Square
	 	 
	 

	 	London E14 5AQ	 	 
	Fax:

	 	+44 (0)20 7174 6400	 	 
	Attention:

	 	Business Capital, Portfolio Management	 	 






	 	 	 
	THE ARRANGER
	 	 
	 
	 	 
	SIGNED for and on behalf of
	 	)
	BANK OF AMERICA, NATIONAL
	 	)
	ASSOCIATION by: /s/ Lee Masters
	 	)






	 	 	 	 	 
	Address:

	 	5 Canada Square
	 	 
	 

	 	London E14 5AQ	 	 
	Fax:

	 	+44 (0)20 7174 6400	 	 
	Attention:

	 	Business Capital, Portfolio Management	 	 






	 	 	 
	THE SECURITY TRUSTEE
	 	 
	 
	 	 
	SIGNED for and on behalf of
	 	)
	BANK OF AMERICA, NATIONAL
	 	)
	ASSOCIATION by: /s/ Lee Masters
	 	)






	 	 	 	 	 
	Address:

	 	5 Canada Square
	 	 
	 

	 	London E14 5AQ	 	 
	Fax:

	 	+44 (0)20 7174 6400	 	 
	Attention:

	 	Business Capital, Portfolio Management	 	 






	 	 	 
	THE SWINGLINE LENDER
	 	 
	 
	 	 
	SIGNED for and on behalf of
	 	)
	BANK OF AMERICA, NATIONAL
	 	)
	ASSOCIATION by: /s/ Lee Masters
	 	)






	 	 	 	 	 
	Address:

	 	5 Canada Square
	 	 
	 

	 	London E14 5AQ	 	 
	Fax:

	 	+44 (0)20 7174 6400	 	 
	Attention:

	 	Business Capital, Portfolio Management	 	 






	 	 	 
	THE ISSUER
	 	 
	 
	 	 
	SIGNED for and on behalf of
	 	)
	BANK OF AMERICA, NATIONAL
	 	)
	ASSOCIATION by: /s/ Lee Masters
	 	)






	 	 	 	 	 
	Address:

	 	5 Canada Square
	 	 
	 

	 	London E14 5AQ	 	 
	Fax:

	 	+44 (0)20 7174 6400	 	 
	Attention:

	 	Business Capital, Portfolio Management	 	 






13









 






	 	 	 
	THE LENDERS
	 	 
	 
	 	 
	SIGNED for and on behalf of
	 	)
	BANK OF AMERICA, NATIONAL
	 	)
	ASSOCIATION
by: /s/ Lee Masters
	 	)






	 	 	 	 	 
	Address:

	 	5 Canada Square
	 	 
	 

	 	London, E14 5AQ	 	 
	Fax:

	 	+44 (0)20 7174 6400	 	 
	Attention:

	 	Business Capital, Portfolio Management	 	 






	 	 	 
	SIGNED for and on behalf of
	 	)
	LLOYDS TSB COMMERCIAL 
FINANCELIMITED by: /s/ Jon, Fenton-Jones
	 	)
	 
	 	)






	 	 	 	 	 
	Address:

	 	Vanburgh House
	 	 
	 

	 	Grange Road	 	 
	 

	 	Hedge End, Southampton	 	 
	 

	 	Hampshire SO30 2AF	 	 
	Fax:

	 	+44 (0)1489 789903	 	 
	Attention:

	 	Ronnie Whitehead or Ren Randev	 	 






	 	 	 
	SIGNED for and on behalf of
	 	)
	ENTERPRISE FINANCE EUROPE
	 	)
	(UK) LIMITED by: /s/ Gregg Pietersen
	 	)






	 	 	 	 	 
	Address: 




Fax: 

Attention:

	 	3rd Floor

31 Worship Street

London EC2A 2DX

+44 (0)207 448 1931

Peter Hayden/Cathal Brennan/Gerry Hoare/ Colin Keene
	 	 






14









 





Exhibit A




Dated 2 December 2002




BELL MICROPRODUCTS LIMITED

BELL MICROPRODUCTS EUROPE EXPORT LIMITED




as Original Borrowers




and




BM EUROPE PARTNERS C.V.

BELL MICROPRODUCTS EUROPE BV




BANK OF AMERICA, NATIONAL ASSOCIATION




as Arranger, Issuer, Swingline Lender, Agent and Security Trustee




and




CERTAIN BANKS AND FINANCIAL INSTITUTIONS




as Lenders




SYNDICATED CREDIT AGREEMENT




as amended and/or restated by supplemental agreements dated 3 December 2003, 22 September 2004, 17

March 2005, 16 August 2005, 20 October 2005, 2 January 2007 and 21 May 2008




CMS Cameron McKenna LLP

Mitre House

160 Aldersgate Street

London EC1 4DD

DOCL/0Z2950.01541




1









 





	 	 	 	 	 
	1.
	 	INTERPRETATION	 	4
	2.
	 	THE REVOLVING FACILITY	 	28
	3.
	 	ADDITIONAL BORROWERS AND UNSECURED GUARANTORS	 	29
	4.
	 	ADDITIONAL CHARGING COMPANIES	 	31
	5.
	 	CONDITIONS PRECEDENT	 	32
	6.
	 	UTILISATION OF THE REVOLVING FACILITY	 	32
	7.
	 	INTEREST AND INTEREST PERIODS	 	41
	8.
	 	MARKET DISRUPTION	 	45
	9.
	 	REPAYMENT, PREPAYMENT AND CANCELLATION	 	45
	10.
	 	TAXES	 	47
	11.
	 	INCREASED COSTS	 	49
	12.
	 	ILLEGALITY	 	50
	13.
	 	GUARANTEE	 	51
	14.
	 	REPRESENTATIONS AND WARRANTIES	 	54
	15.
	 	FINANCIAL CONDITION	 	60
	16.
	 	COVENANTS	 	64
	17.
	 	DEFAULT	 	81
	18.
	 	DEFAULT INTEREST	 	86
	19.
	 	INDEMNITIES	 	87
	20.
	 	CURRENCY OF ACCOUNT AND PAYMENTS	 	88
	21.
	 	SET-OFF	 	91
	22.
	 	FEES	 	91
	23.
	 	PRO RATA SHARING	 	93
	24.
	 	COSTS, EXPENSES AND STAMP DUTIES	 	94
	25.
	 	CALCULATIONS AND EVIDENCE OF DEBT	 	95
	26.
	 	THE AGENT, THE ARRANGER, THE SECURITY TRUSTEE AND THE LENDERS	 	97
	27.
	 	TRUSTEE PROVISIONS	 	101
	28.
	 	ASSIGNMENTS AND TRANSFERS	 	106
	29.
	 	TERM AND TERMINATION	 	108
	30.
	 	AMENDMENTS, WAIVERS AND REMEDIES	 	109
	31.
	 	PARTIAL INVALIDITY	 	110
	32.
	 	NOTICES	 	110
	33.
	 	COUNTERPARTS	 	111
	34.
	 	DUTCH PARALLEL DEBT	 	111
	35.
	 	LAW AND JURISDICTION	 	112
	 
	 	 	 	 
	SCHEDULE 1	 	114
	 
	 	 	 	 
	LENDERS AND COMMITMENTS	 	114
	 
	 	 	 	 
	SCHEDULE 2	 	115
	 
	 	 	 	 
	CONDITIONS PRECEDENT	 	115
	 
	 	 	 	 





2









 






	 	 	 	 	 
	SCHEDULE 3
	 	 	117	 
	 
	 	 	 	 
	FORM OF OBLIGOR’S CERTIFICATE
	 	 	117	 
	 
	 	 	 	 
	SCHEDULE 4
	 	 	119	 
	 
	 	 	 	 
	FORM OF UTILISATION NOTICE
	 	 	119	 
	 
	 	 	 	 
	SCHEDULE 5
	 	 	120	 
	 
	 	 	 	 
	MANDATORY COST FORMULAE
	 	 	120	 
	 
	 	 	 	 
	SCHEDULE 6
	 	 	123	 
	 
	 	 	 	 
	FORM OF TRANSFER CERTIFICATE
	 	 	123	 
	 
	 	 	 	 
	SCHEDULE 7
	 	 	126	 
	 
	 	 	 	 
	THE DORMANT COMPANIES AND THE GUARANTORS
	 	 	126	 
	 
	 	 	 	 
	SCHEDULE 8
	 	 	127	 
	 
	 	 	 	 
	FORM OF ACCESSION NOTICE
	 	 	127	 
	 
	 	 	 	 
	SCHEDULE 9
	 	 	128	 
	 
	 	 	 	 
	DOCUMENTS TO ACCOMPANY ACCESSION NOTICE OR SUPPLEMENTAL DEED
	 	 	128	 
	 
	 	 	 	 
	SCHEDULE 10
	 	 	130	 
	 
	 	 	 	 
	THE MATERIAL CONTRACTS
	 	 	130	 






3









 





THIS AGREEMENT is made on 2 December 2002, as amended and/or restated on 3 December 2003, 22
September 2004, 17 March 2005, 16 August 2005, 20 October 2005, 2 January 2007 and 21 May 2008




BETWEEN:





	(1)	 	BELL MICROPRODUCTS LIMITED company incorporated in England and Wales with registered number
03969946 whose registered office is at, Cox Lane, Chessington, Surrey KT9 1SJ (“BMUK”) and
BELL MICROPRODUCTS EUROPE EXPORT LIMITED a company incorporated in England and Wales with
registered number 03711148 whose registered office is at Cox Lane, Chessington, Surrey KT9 1SJ
(“BMEE”) (each an “Original Borrower” and together, the “Original Borrowers”);
	 
	(2)	 	BM EUROPE PARTNERS C.V. a limited partnership (commanditaire vennootschap) established under
the laws of the Netherlands, having its official seat in Emmen, the Netherlands and its
registered office at Veluwezoom 42-50, 1327 AH Almere, the Netherlands and registered in the
Commercial Register under number 04065637 (“BMEP”);
	 
	(3)	 	BELL MICROPRODUCTS EUROPE B.V. a private company with limited liability (besloten
vennootschap met beperkte aansprakelijkheid) incorporated under the laws of the Netherlands,
having its official seat in Emmen, the Netherlands and its registered office at Veluwezoom
42-50, 1327 AH Almere, the Netherlands and registered in the Commercial Register under number
04064633 (“BMEBV”);
	 
	(4)	 	BANK OF AMERICA, NATIONAL ASSOCIATION acting through its London branch at 5 Canada Square,
London, E14 5AQ in its capacity as arranger (the “Arranger”), in its capacity as agent for the
Lenders (the “Agent”), in its capacity as the Lender making Swingline Loans (the “Swingline
Lender”), in its capacity as the Lender issuing any Letter of Credit or Guarantee (the
“Issuer”) and in its capacity as security trustee under the Security Documents (the “Security
Trustee”); and
	 
	(5)	 	THE BANKS AND FINANCIAL INSTITUTIONS named in Schedule 1 (the “Original Lenders”).





IT IS AGREED as follows:





	1.	 	INTERPRETATION
	 
	1.1	 	Definitions
	 
	 	 	Save as otherwise provided in this Agreement, the following words and phrases have the
following meanings throughout this Agreement:
	 
	 	 	Accession Notice: a notice substantially in the form set out in Schedule 8 (Form of
Accession Notice) pursuant to which a Group Company may accede to this Agreement as an
Additional Borrower or, as the case may be, an Unsecured Guarantor;
	 
	 	 	Account: in relation to each Trading Company, its right to payment for a sale or lease and
delivery of goods or rendering of services;
	 
	 	 	Account Debtor: each person having any obligation on or in connection with an Account;
	 
	 	 	Accounts Transfer Conditions: the accounts transfer conditions incorporated into the
Invoice Discounting Agreements entered into by each IDF Company from time to time;




4









 












	 	 	Additional Borrower: a Group Company which has acceded to this Agreement as an Additional
Borrower by executing and delivering to the Agent an Accession Notice in accordance with
Clause 3 (Additional Borrowers and Unsecured Guarantors);
	 
	 	 	Additional Cost Rate: the meaning given to it in paragraph 2 of Schedule 5 (Mandatory Cost
Formulae);
	 
	 	 	Additional Monitoring and Administration Fee: the meaning given to it in Clause 22.7
(Additional Monitoring and Administration Fee);
	 
	 	 	Adjusted Tangible Assets: the meaning given to it in Clause 15.4 (Financial Ratios);
	 
	 	 	Adjusted Tangible Net Worth: the meaning given to it in Clause 15.4 (Financial Ratios);
	 
	 	 	Affiliate:






	 	(i)	 	a person which, directly or indirectly, controls or is controlled by or is
under common control with, a Borrower;
	 
	 	(ii)	 	a person which beneficially owns or holds, directly or indirectly, 5% or
more of any class of voting shares of a Borrower; or
	 
	 	(iii)	 	a person in which 5% of any class of voting shares is beneficially owned
or held, directly or indirectly, by a Borrower;






	 	 	Agent Loan: the meaning given to it in Clause 6.15.1 (Authorisation);
	 
	 	 	Agent’s Spot Rate of Exchange: the Agent’s spot rate of exchange for the purchase of the
relevant currency with sterling in the London foreign exchange market at or about 11.00
a.m. on a particular day;
	 
	 	 	Aggregate Exposure: at any time, the aggregate at such time of the Total Outstandings and
the Invoice Discounting Facility Exposure at such time;
	 
	 	 	Anniversary Date: 20 October 2008 and each subsequent anniversary of such date;
	 
	 	 	Applicable GAAP:






	 	(i)	 	save as provided in paragraph (ii) of this definition, in respect of any
person, the generally accepted accounting principles and policies in the country in
which such person is incorporated or under whose laws it is otherwise established,
consistently applied; and
	 
	 	(ii)	 	in connection with the preparation of the Pro-Forma Balance Sheet and the
Management Accounts and for the purposes of determining compliance by BMUK with the
financial ratio set out in Clause 15.4 (Financial Ratios), generally accepted
accounting principles and policies in the United States of America, consistently
applied (“US GAAP”);






	 	 	Applicable Margin: unless by virtue of the operation of Clause 7.6 (Margin Ratchet) a
lower rate applies, two and one half of one per cent. (2.50%) per annum;
	 
	 	 	Approved Acquisition Conditions: each of the following conditions:




5









 












	 	(i)	 	that the relevant acquisition (the “relevant acquisition”) is to be funded
by the relevant Group Company (a “purchaser”) entirely out of Excess Availability and
that at the time of the relevant acquisition, the amount of Excess Availability was
not less than £5,000,000 and the projections, forecasts and other information
supplied to the Agent pursuant to Clause 15.2 (Provision of Financial Information)
demonstrate that an average Excess Availability of not less than £5,000,000 will be
maintained for a continuous period of three (3) months commencing on the date of
completion of the relevant acquisition;
	 
	 	(ii)	 	that the costs of the relevant acquisition do not exceed £10,000,000 (or
the equivalent in any other currency) and when aggregated with the costs of all other
Pre-Approved Acquisitions made or in the process of being made by that or any other
purchaser do not or, as the case may be, will not, exceed £20,000,000 (or the
equivalent in any other currency) during the term of this Agreement;
	 
	 	(iii)	 	that the relevant purchaser (or BMUK on its behalf) has given written
notice to the Agent (such notice to be served not less than 15 business days prior to
the proposed date of completion of the relevant acquisition), such notice to include,
without limitation, (A) the name of the company and/or a brief description of the
assets being purchased and/or the nature of such company’s business; (B) a breakdown
of the total consideration payable (including any element of deferred consideration
and/or the details of any earn-out or possible additional consideration payable); (C)
the business case or other reason(s) underlying the relevant acquisition; (D) the
basic terms and conditions of the relevant acquisition; (E) a brief business plan and
a historic financial statement in relation to any company being purchased (to include
a profit and loss account, balance sheet and cash flow statement relating to the
immediately preceding 12 months);
	 
	 	(iv)	 	in the case of any relevant acquisition of shares in a company, such
acquisition has been approved or recommended by the board of directors of such
company;
	 
	 	(v)	 	that the finance director of BMUK has delivered a certificate to the Agent
(together with such additional information or evidence as the Agent may have
reasonably required) confirming, among other matters, (A) that no Default has
occurred and is continuing or will occur as a result of the completion of the
relevant acquisition or would have occurred if the relevant acquisition had been
completed on the last day of the Financial Quarter most recently ended; (B) the level
of current creditors’ days outstanding together with confirmation that the largest
twenty (20) trade creditors of the Group are being paid in accordance with the credit
terms prevailing between such parties; and (C) that each of the foregoing conditions
set out in paragraphs (i) to (iv) (inclusive) has been satisfied and will continue to
be complied with as at each relevant date prescribed in this definition of “Approved
Acquisition Conditions”.






	 	 	For the purpose of this definition of “Approved Acquisition Conditions”, the expression
“costs” shall be construed to mean the total initial, deferred or additional consideration
paid or payable to any person(s) in connection with any relevant acquisition, together
with all reasonable costs, fees and expenses (including legal or other professional
advisers’ fees) properly paid or payable in connection with the relevant acquisition;
	 
	 	 	Approved Acquisition Documents: any (i) sale agreement, (ii) share exchange agreement,
(iii) offering circular or (iv) any other documents or instruments (howsoever described)
relating to a Pre-Approved Acquisition or any other acquisition of assets approved by the
Agent;
	 
	 	 	Audit Fee: the meaning given to it in Clause 22.4 (Audit Fee);




6









 












	 	 	Auditors: PricewaterhouseCoopers, chartered accountants, or any other firm of chartered
accountants of similar standing selected by BMUK and satisfactory to the Agent;
	 
	 	 	Available Commitment: in relation to a Lender at any time, the Commitment of that Lender
less the sum at such time of the Original Sterling Amount of (i) the aggregate amount
which it has advanced and (ii) (in the case of the Issuer) the aggregate of its contingent
liabilities under any Letters of Credit or Guarantees issued by it;
	 
	 	 	Available Facility: at any time, the aggregate of the Available Commitments;
	 
	 	 	Available Revolving Facility Amount: at any time, in relation to the Revolving Facility
and any proposed Utilisation thereof by any Borrower, the Revolving Facility Amount as
reduced by the sum at such time of the Original Sterling Amount of:






	 	(i)	 	the aggregate principal amount of all Revolving Loans and Swingline Loans
then outstanding;
	 
	 	(ii)	 	the aggregate face amount of all Letters of Credit and of the aggregate
maximum contingent liability under all Guarantees issued by the Issuer;
	 
	 	(iii)	 	the amount by which the Commitment of any Lender is or is due to be
permanently cancelled or reduced in accordance with the terms of this Agreement;
	 
	 	(iv)	 	all reserves for accrued interest on the Revolving Loans and Swingline
Loans;
	 
	 	(v)	 	the Invoice Discounting Facility Exposure at such time;
	 
	 	(vi)	 	any IDF Portfolio Loss; and
	 
	 	(vii)	 	all other reserves which the Agent in its discretion deems necessary or
desirable to maintain with respect to any Borrower’s account (including, without
limitation, in respect of any day-to-day fluctuations in the value of sterling
against any Foreign Currency and in respect of any liability of any Borrower under
any Hedging Agreement or in respect of any other Bank Products) and any amounts which
the Agent, the Security Trustee, any Lender or any other Beneficiary may be obliged
to pay in the future for the account of any Borrower;






	 	 	Bank Product: any of the following products, services or facilities extended to an
Obligor: (a) Cash Management Services; (b) products under Hedging Agreements; (c)
commercial credit card and merchant card services; and (d) leases and other banking
products or services as may be requested by an Obligor, other than Letters of Credit or
other Utilisations;
	 
	 	 	Bank Product Debt: financial indebtedness and other obligations of an Obligor relating to
Bank Products;
	 
	 	 	Belgian IDF Company: Bell Microproducts BVBA, a corporation incorporated under the laws of
Belgium with registered number 0474128872 and having its registered office at Mechelen
Campus, Schalienhoevedreef 20 1, B-2800 Mechelen, Belgium;
	 
	 	 	Belgian Invoice Discounting Agreement: the invoice discounting agreement dated 15 December
2004 and made between the Belgian IDF Company and Bank of America, National Association
acting through its Antwerp branch at Uitbreidingstraat 180, Box 6, B2600, Antwerp,
Belgium;




7









 












	 	 	Belgian Pledge: any pledge in respect of the Company Accounts and the Non-Vesting Accounts
of the Belgian IDF Company, in form and substance satisfactory to the Agent and the
Receivables Purchaser;
	 
	 	 	Beneficiary: collectively (a) each of the Agent, the Arranger, any Hedge Provider
(provided always that such Hedge Provider is BofA), the Swingline Lender, the Issuer, the
Security Trustee and any Lender; (b) BofA (in relation to Bank Products) and (c) BofA in
its capacity as Receivables Purchaser;
	 
	 	 	BMEH: Bell Microproducts Europe (Holdings) B.V., a private company with limited liability
(besloten vennootschap met beperkte aansprakelijkheid) incorporated under the laws of the
Netherlands, having its official seat in Almere, the Netherlands and its registered office
at Veluwezoom 42-50, 1327 AH Almere, the Netherlands and registered in the Netherlands
with the Trade Register under number: 39087200;
	 
	 	 	BMEH IBM Guarantees: the guarantees dated 1 December 2005 entered into by BMEH in favour
of the IBM Entities for a principal amount not exceeding €40,000,000 in aggregate in
respect of the obligations of members of the Restricted Group under invoice purchase,
working capital and term loan facility agreements entered into and to be entered into
between the IBM Entities (or any of them) and certain members of the Restricted Group;
	 
	 	 	BMEH Reichl Guarantee: the guarantee by BMEH in favour of Mr Klaus Reichl for an amount
not exceeding €4,000,000 in aggregate in respect of the obligations of Bell Microproducts
Solutions GmbH under a facility agreement dated 23 November 2005 and made between Mr Klaus
Reichl (as lender), Bell Microproducts Solutions GmbH (as borrower) and BMEH (as
guarantor);
	 
	 	 	BMUK/IDFC Group: collectively, the BMUK Group and each of the IDF Companies;
	 
	 	 	BMUK Group: BMUK and its Subsidiaries for the time being;
	 
	 	 	BofA: Bank of America, N.A.;
	 
	 	 	Borrowers: each Original Borrower and each Additional Borrower and “Borrower” means any
one of them;
	 
	 	 	Borrowing Base Certificate: a certificate in such form as the Agent may from time to time
reasonably require and completed by BMUK setting out, amongst other things, details of
Accounts and with effect from the Inventory Eligibility Date, if applicable, Inventory (as
specified in Clause 16.4.1 (Collateral Reporting) and of preferential creditors so as to
enable the Agent to determine the Available Revolving Facility Amount;
	 
	 	 	Borrowings: a sum equal to the aggregate amount for the time being of the principal,
capital or nominal amount (determined on a consolidated basis) of all financial
indebtedness of any member of the Group (other than moneys borrowed or raised from another
member of the Group) and, without prejudice to the generality of the foregoing, shall be
deemed to include the following:






	 	(a)	 	the principal amount of any debenture, bond, note, loan stock, preference
share capital, commercial paper or similar instrument of any member of the Group;
	 
	 	(b)	 	any amounts raised by any member of the Group under any bill of exchange
(but excluding any bill drawn or accepted in the ordinary course of trade of the
relevant member of the Group and which is payable at sight or not more than 90 days
after sight or has a final maturity of not more than 90 days from the date thereof
and is not




8









 












	 	 	 	refinancing another bill whether or not relating to the same underlying
transaction) and the indebtedness of any member of the Group under any acceptance
credit, bill discounting, note purchase or documentary credit facility;
	 
	 	(c)	 	the aggregate amount remaining to be paid by any member of the Group under
any credit agreement save for amounts remaining to be paid which cannot properly be
attributed to capital in accordance with Applicable GAAP;
	 
	 	(d)	 	the capitalised value (determined in accordance with Applicable GAAP) of
the outstanding commitments of any member of the Group under any finance lease;
	 
	 	(e)	 	indebtedness under any receivables purchase, factoring or discounting
arrangement including, without limitation, the Invoice Discounting Agreements (to the
extent there is any recourse against any member of the Group);
	 
	 	(f)	 	the aggregate amount remaining to be paid in respect of any credit (other
than normal trade credit which has been outstanding for a period of less than 90
days) granted to, or of any deferred payments due from, any member of the Group in
respect of the acquisition or construction price of assets acquired or constructed or
the purchase price of services supplied;
	 
	 	(g)	 	indebtedness of any member of the Group in respect of any other transaction
having the commercial effect of a borrowing or other raising of money entered into by
it in order to finance its business or operations or capital requirements; and
	 
	 	(h)	 	(without double counting) indebtedness of any member of the Group under any
guarantee or other assurance against financial loss in respect of the financial
indebtedness of any person.






	 	 	For the purpose of determining the amount of “Borrowings” at any time, any amount which is
on a particular day outstanding or repayable in a currency other than sterling shall on
that day be taken into account (i) if that day is the last day of a Financial Year or
Management Accounting Period, at its equivalent in sterling at the rate of exchange used
for the purpose of preparing the balance sheet forming part of the Relevant Accounting
Information prepared as at such date and (ii) in any other case, at its sterling
equivalent as determined by the Agent by reference to the Agent’s Spot Rate of Exchange;
	 
	 	 	Borrowing Costs: in relation to any financial period, a sum equal to the aggregate amount
of all continuing, regular or periodic costs (excluding any prepayment or termination
fee), charges and expenses incurred by the BMUK/IDFC Group in respect of such period (and
whether paid or not) in effecting, servicing or maintaining Borrowings including (but
without double-counting):






	 	(a)	 	interest (whether the same shall be payable immediately or be capitalised
or otherwise deferred);
	 
	 	(b)	 	any fixed or minimum premium or dividend paid or payable on the maturity of
any Borrowings;
	 
	 	(c)	 	consideration given whether by way of discount or otherwise in connection
with finance by way of acceptance credit, bill discounting, note purchase,
receivables purchase, debt factoring or other like arrangement including, without
limitation, the discount charge payable under the Invoice Discounting Agreements; and




9









 












	 	(d)	 	the gross amount payable under any finance lease or credit agreement less
so much as can properly be attributed to capital,






	 	 	the amount of any such costs, charges and expenses to be allocated to each such period
over the term of any Borrowings in accordance with Applicable GAAP;
	 
	 	 	Capital Expenditure: all payments due (whether or not paid) in respect of the cost of any
fixed asset or any improvement, replacement, substitution or addition thereto, which has a
useful life of more than one year, including, without limitation, those arising in
connection with the direct or indirect acquisition of such assets by way of increased
product or service charges or offset items or in connection with finance leases;
	 
	 	 	Capital Markets Transaction: any direct or indirect public offering or private placement
of any debt or equity securities of (including any capital contribution to) any Borrower,
BMEP, BMEH or BMEBV;
	 
	 	 	Cash Management Services: any services provided from time to time by BofA or any of its
Affiliates to an Obligor in connection with operating, collections, payroll, trust, or
other depository or disbursement accounts, including automated clearinghouse, e-payable,
electronic funds transfer, wire transfer, controlled disbursement, overdraft, depository,
information reporting, lockbox and stop payment services;
	 
	 	 	Cash Outflow: in relation to any financial period and without double-counting, the
aggregate for that period of:






	 	(i)	 	Borrowing Costs;
	 
	 	(ii)	 	taxes paid;
	 
	 	(iii)	 	dividends paid or other distributions made;
	 
	 	(iv)	 	Capital Expenditure;
	 
	 	(v)	 	amortisation payments on Borrowings and the capital element of any rental
payments or instalments under any credit agreement or finance lease;
	 
	 	(vi)	 	any expenditure which results in a corresponding release of any provision
in the balance sheet;






	 	 	Charging Company: the companies listed in Part 2 of Schedule 7 (The Dormant Companies and
the Guarantors) and any other Group Company which has executed the Debenture or any other
Security Document or which has acceded to the Debenture or any other Security Document by
executing a Supplemental Deed in accordance with Clause 4 (Additional Charging Companies);
	 
	 	 	Closing Date: 2 December 2002;
	 
	 	 	Collateral: the meaning given to it in the Debenture;
	 
	 	 	Collateral Management Fee: the meaning given to it in Clause 22.3 (Collateral Management
Fee);
	 
	 	 	Commitment: in relation to a Lender at any time, the amount in sterling set opposite its
name in Schedule 1 (Lenders and Commitments) (and/or, as the case may be, the amount in
sterling specified as the portion transferred in the Transfer Certificate pursuant to
which such Lender





10









 











	 	 	increased its Commitment or became a party to this Agreement) as the same may at any time
be cancelled or reduced in accordance with this Agreement;
	 
	 	 	Commitment Period: the period commencing on the Closing Date and ending on the date
falling one month prior to the Termination Date;
	 
	 	 	Company Accounts: has, as the context requires, the meaning ascribed to it in the
applicable Invoice Discounting Agreement;
	 
	 	 	Debenture: the composite guarantee and debenture creating one or more encumbrances in
favour of the Security Trustee on behalf of the Beneficiaries, dated 2 December 2002 and
executed as a deed by certain Charging Companies to secure the obligations of the Obligors
under the Finance Documents;
	 
	 	 	Default: an Event of Default or any condition, act or event which (with the giving of
notice, lapse of time, making of any determination, fulfilment of any condition or any
combination of any of the foregoing) may become an Event of Default;
	 
	 	 	Discharge: a release, spill, emission, leaking, pumping, injection, deposit, disposal,
discharge, dispersal, leaching or migration of a Hazardous Substance into the indoor or
outdoor environment or into or out of any real estate or other property, including the
movement of Hazardous Substances through or in the air, soil, surface water, groundwater
or real estate or other property;
	 
	 	 	Distribution: any dividend or other distribution (whether in cash or in kind) in respect
of share capital, including any bonus issue or return of capital (whether at a premium or
otherwise);
	 
	 	 	Dormant Company: a company which is a “dormant” company as defined in section 249AA
Companies Act 1985 and which does not at any time have assets (other than intercompany
indebtedness) in excess of £5,000 (or the equivalent in any other currency) and which
expression shall include, for the purposes of this Agreement, each of the companies whose
names are set out in Part 1 of Schedule 7;
	 
	 	 	EBITDA: in relation to any financial period, a sum equal to the BMUK/IDFC Group’s profit
on ordinary activities before taxation (save to the extent that such profit is
attributable to any interest received) after adding back Borrowing Costs, depreciation and
amortisation and deducting any release to profits of negative goodwill in respect of such
period but excluding:






	 	(a)	 	profits or losses on the sale or termination of an operation;
	 
	 	(b)	 	profits or losses on the disposal of fixed assets; and
	 
	 	(c)	 	extraordinary items;






	 	 	EC Insolvency Regulation: Council Regulation (EC) No. 11346/2000 of 29 May 2000 on
insolvency proceedings;
	 
	 	 	Effective Date: the meaning given to it in clause 3.1 (Effective Date) of the Supplemental
Agreement dated 21 May 2008;
	 
	 	 	Eligible Accounts: the Accounts which the Agent in the exercise of its commercial
discretion determines to be Eligible Accounts. Without limiting the discretion of the
Agent to establish other criteria of ineligibility, Eligible Accounts shall not, unless
the Agent in its commercial discretion elects, include any Account:




11









 












	 	(a)	 	with respect to which more than ninety (90) days have elapsed since the
date of the original invoice or sixty (60) days have elapsed since the due date
therefor;
	 
	 	(b)	 	with respect to which any of the representations, warranties, covenants and
agreements contained in the Debenture are incorrect or have been breached;
	 
	 	(c)	 	with respect to which Account (or any other Account due from the applicable
Account Debtor), in whole or in part, a cheque, promissory note, draft, trade
acceptance or other instrument for the payment of money has been received, presented
for payment, and returned uncollected for any reason;
	 
	 	(d)	 	which represents a progress billing (as hereinafter defined) or as to which
the applicable Borrower has extended the time for payment without the consent of the
Agent (for the purposes hereof, “progress billing” means any invoice for goods sold
or leased or services rendered under a contract or agreement pursuant to which the
Account Debtor’s obligation to pay such invoice is conditional upon such Borrower’s
completion of any further performance under such contract or agreement);
	 
	 	(e)	 	with respect to which any one or more of the following events has occurred
to the Account Debtor on such Account: (i) death or judicial declaration of
incompetency of such Account Debtor who is a natural person; (ii) the filing by or
against such Account Debtor of a request, notice of intention to appoint or petition
for winding-up, dissolution, liquidation or bankruptcy of such person or for the
appointment of an administrative receiver, receiver, manager or administrator in
respect of such person or its assets or any other bankruptcy, insolvency or similar
laws of the United Kingdom or any foreign jurisdiction now or hereafter in effect;
(iii) the making of any general assignment by such Account Debtor for the benefit of
its creditors; (iv) the appointment of a receiver or trustee of such Account Debtor
or of any of the assets of the Account Debtor; (v) the institution by or against such
Account Debtor of any other type of insolvency proceeding or of any formal or
informal proceeding for the dissolution or liquidation of, settlement of claims
against, or winding up of affairs of, such Account Debtor; (vi) the non-payment
generally of such Account Debtor of its debts as they become due; or (vii) the
cessation of the business of such Account Debtor as a going concern;
	 
	 	(f)	 	if fifty per cent. (50%) or more of the aggregate sterling equivalent of
outstanding Accounts owed at such time by the Account Debtor thereon is classified as
ineligible pursuant to the other provisions of this definition;
	 
	 	(g)	 	owed by an Account Debtor which (i) does not maintain its registered office
or principal place of business in the United States, Canada (other than the Province
of Newfoundland), the United Kingdom or another country within the European Union
prior to 1 May 2004, (ii) is not organised under the laws of the United States,
Canada, part of the United Kingdom or another country within the European Union prior
to 1 May 2004 or any political subdivision, state or province thereof, or (iii) is
the government of any foreign country or sovereign state, or of any state, province
municipality or other political subdivision thereof, or of any department, agency,
public corporation, or other instrumentality thereof, except to the extent that such
Account is secured or payable by a letter of credit satisfactory to the Agent in its
discretion;
	 
	 	(h)	 	owed by an Account Debtor which is an Affiliate or employee of such
Borrower or an Account which the Agent determines is an Intercompany Account or an
internal account;





12









 






	 	(i)	 	with respect to Accounts of a Borrower, with respect to which either the
perfection, enforceability or validity of the security over such Account constituted
by the Debenture, or the Security Trustee’s or the Agent’s right or ability to obtain
direct payment to the Agent or, as appropriate, the Security Trustee, of the proceeds
of such Account, is governed by any laws other than the local state or federal laws
of the United States of America (including the UCC) or the laws of Canada, any part
of the United Kingdom or another member of the European Union prior to 1 May 2004;
	 
	 	(j)	 	owed by an Account Debtor to which a Borrower or any Affiliate thereof is
indebted in any way, or which is subject to any right of set-off or recoupment by the
Account Debtor (or otherwise a contra account), unless the Account Debtor has entered
into an agreement acceptable to the Agent to waive set-off rights, or if the Account
Debtor thereon has disputed liability or made any claim with respect to any other
Account due from such Account Debtor;
	 
	 	(k)	 	[intentionally omitted];
	 
	 	(l)	 	which represents a sale on a bill-and-hold, guaranteed sale, sale and
return, sale on approval, consignment or other repurchase or return basis;
	 
	 	(m)	 	which is evidenced by a promissory note or other similar instrument;
	 
	 	(n)	 	with respect to which the Agent believes, in the exercise of its commercial
judgment, that the prospect of collection of such Account is impaired or that such
Account may not be paid by reason of the Account Debtor’s financial inability to pay;
	 
	 	(o)	 	which arises out of a sale not made in the ordinary course of such
Borrower’s business;
	 
	 	(p)	 	with respect to which the goods giving rise to such Account have not been
shipped and delivered to and accepted by, or have been rejected or objected to by,
the Account Debtor or the services giving rise to such Account have not been fully
performed by such Borrower, and, if applicable, accepted by the Account Debtor, or
the Account Debtor revokes its acceptance of such goods or services;
	 
	 	(q)	 	owed by an Account Debtor or group of affiliated Account Debtors which is
obligated to the Borrowers, or any of them, representing Accounts the aggregate
unpaid balance of which exceeds ten per cent. (10%) of the aggregate unpaid balance
of all Accounts owed to the Borrowers at such time by all of the Borrowers’ Account
Debtors;
	 
	 	(r)	 	which is not subject to a first priority, perfected Security Interest in
favour of the Security Trustee, for the benefit of the Beneficiaries established in a
manner satisfactory to the Agent;
	 
	 	(s)	 	owed by an Account Debtor incorporated outside the United Kingdom with whom
such Borrower is trading in excess of its agreed credit limits;
	 
	 	(t)	 	with respect to which such Borrower or the Agent has deemed such Account as
uncollectible or has any reason to believe that such Account is uncollectible; and
	 
	 	(u)	 	which the Agent determines, in its commercial discretion, is ineligible for
any other reason.






	 	 	The Agent will consider a request from BMUK for the inclusion of Accounts in excess of ten
per cent. (10%) of the total Eligible Accounts (as described in paragraph (q)) on a case
by case





13









 











	 	 	basis, upon production by BMUK of such financial or other information regarding the
business condition (financial or otherwise) of the Borrowers and the Group as the Agent
may require and upon BMUK demonstrating to the satisfaction of the Agent, an improvement
in its trading and financial position since 20 October 2005.
	 
	 	 	If any Account at any time ceases to be an Eligible Account, then such Account shall
promptly be excluded from the calculation of the Maximum Eligibility Amount and the
Revolving Facility Amount;
	 
	 	 	Eligible Inventory: with effect from the Inventory Eligibility Date, if any, Inventory
valued at the lower of cost (on a FIFO basis) or market value, which is eligible as the
basis for Revolving Loans, based on such criteria as the Agent may from time to time
establish in its reasonable commercial discretion;
	 
	 	 	Environmental Authorisation: any authorisation, permit, licence, consent, registration or
other approval required by or pursuant to any Environmental Law;
	 
	 	 	Environmental Laws: all applicable laws, regulations, codes of practice, circulars,
statutory guides, guidance notes and the like (whether in the United Kingdom or in any
other jurisdiction in which any Obligor carries on its business or in which its assets may
be situated) relating to contamination, human health, safety or the environment including
but not limited to those relating to Discharges, waste, nuisance, health and safety,
noise, packaging or the manufacture, processing, use, handling, treatment, storage,
labelling, recovery, recycling, transport or disposal of Hazardous Substances;
	 
	 	 	Equipment: in relation to each Trading Company, all of its now owned and hereafter
acquired machinery, equipment, furniture, furnishings, fixtures and other tangible
personal property of any kind (except Inventory), as well as all of such types of property
leased by it and all of its rights and interest with respect thereto under such leases
together with all present and future additions and accessions thereto and replacements
therefor, component and auxiliary parts and supplies used or to be used in connection
therewith and all substitutes for any of the foregoing, and all manuals, drawings,
instructions, warranties and rights with respect thereto, wherever any of the foregoing is
located;
	 
	 	 	Event of Default: any of those events specified in Clause 17.1 (Events of Default);
	 
	 	 	Excess Availability: at any time, the amount, if any, by which the Revolving Facility
Amount exceeds the Aggregate Exposure at such time;
	 
	 	 	Facility Office: in relation to a Lender at any time, the office set out under its name at
the end of this Agreement or, in the case of a Transferee, in the Transfer Certificate to
which it is a party as Transferee or, in the case of a Lender which is an assignee or
other successor of any other Lender, the office notified to the Agent by the assignee or
other successor on or before the date it becomes a Lender or such other office as such
Lender may from time to time notify to the Agent;
	 
	 	 	Fee Letter: means any letter or letters dated on or about the date of this Agreement
and/or the date of a Supplemental Agreement between the Arranger and BMUK (or the Agent
and/or the Security Trustee and BMUK) setting out and/or relating to any of the fees
referred to in Clause 22 (Fees) and “Fee Letter (2008)” means such letter dated 21 May
2008;
	 
	 	 	Finance Documents: this Agreement, the Invoice Discounting Agreements, any Fee Letter, any
Accession Notice, any Hedging Agreement, the Security Documents, the Supplemental
Agreements, the IBM Standstill Agreement, the Reichl Standstill Agreement, documents





14









 






	 	 	evidencing or constituting Bank Products and any other agreement, deed, notice, document
or certificate from time to time designated as such by the Agent and BMUK;
	 
	 	 	Financial Quarter: any period of three months in any Financial Year, ending on the day
which is, respectively, three, six or nine months after the first day of that Financial
Year or on the last day of that Financial Year;
	 
	 	 	Financial Statements: according to the context in which it is used, the Pro-Forma Balance
Sheet or any financial statements required to be delivered to the Agent pursuant to Clause
15.2 (Provision of Financial Information) and complying with the provisions of Clause 15.3
(Financial Information — basis of preparation);
	 
	 	 	Financial Year: any period of twelve months ending on 31 December;
	 
	 	 	Foreign Currency: dollars, euros or such other currency which is freely transferable and
freely convertible into sterling as may at any time be specifically agreed by the Agent;
	 
	 	 	French IDF Company: Bell Microproducts Sarl, a corporation incorporated under the laws of
France with registered number 43474497500013 and having its registered office at 23 avenue
General Leclerc, 92340, Bourg La Reine, Paris, France;
	 
	 	 	French Invoice Discounting Agreement: the invoice discounting agreement dated 15 December
2004 and made between the French IDF Company and Bank of America, National Association
acting through its Paris branch at 51 rue Francois 1er, 75008 Paris France;
	 
	 	 	French Bank Accounts Pledge: any pledge in respect of the Company Accounts of the French
IDF Company, in form and substance satisfactory to the Agent and the Receivables
Purchaser;
	 
	 	 	Group: BMEH and its Subsidiaries at any time including, whether or not a Subsidiary of
BMEH, each IDF Company (but excluding, in each case, unless the Agent otherwise agrees,
any member of the Restricted Group) and “Group Company” shall mean any one of them;
	 
	 	 	Guarantee: any guarantee (which has been specifically agreed between the relevant Borrower
and the Agent) of the obligations of any person issued by the Issuer at the request of
that Borrower pursuant to the terms of Clause 6.4 (Letters of Credit and Guarantees);
	 
	 	 	Guarantors: each Secured Guarantor and each Unsecured Guarantor and “Guarantor” means any
one of them;
	 
	 	 	Hazardous Substance: any radioactive emissions and any natural or artificial substance
(whether in solid or liquid form or in the form of a gas or vapour and whether alone or in
combination with any other substance) capable of causing harm to the environment, human
health or welfare or to any organism, including (without limitation) any type of waste or
any form of energy;
	 
	 	 	Hedge Provider: the Arranger, any Lender or any other bank or financial institution of
international standing whose long term unsecured debt securities are, on the date that it
enters into any Hedging Agreement, rated at least A+ by S&P or A1 by Moody’s;
	 
	 	 	Hedging Agreement: any agreement or instrument between an Obligor and a Hedge Provider
relating to the hedging of an interest rate or a currency exposure (including a swap,
option, cap, collar or floor);





15









 






	 	 	IBM Entities: means Nederland Financieringen B.V., IBM Belgium Financial Services S.A. and
IBM Deutschland Kreditbank GmbH (as agent for the foregoing entities) (and “IBM Entity”
means any one of them);
	 
	 	 	IBM Standstill Agreement: the standstill agreement dated on or about 20 December 2005 and
entered into between (1) IBM Deutschland Kreditbank GmbH (as agent for the other IBM
Entitites), (2) the Agent and the Security Trustee and (3) BMEH;
	 
	 	 	IDF Companies: means the Belgian IDF Company, the French IDF Company and the Italian IDF
Company and any other company which has entered into an Invoice Discounting Agreement and
which has consequently been designated an IDF Company by the Receivables Purchaser from
time to time and “IDF Company” means any one of them;
	 
	 	 	IDF Guarantee: the guarantee by the Borrowers contained in clause 7 (Guarantee) of the
Supplemental Agreement dated 15 December 2004;
	 
	 	 	IDF Portfolio Loss: an amount equal to the amount by which the Remittances (as defined in
the Accounts Transfer Conditions) received in respect of an Account (as defined in the
Accounts Transfer Conditions) purchased by the Receivables Purchaser pursuant to an
Invoice Discounting Agreement fall short of the Purchase Price (as defined in the Accounts
Transfer Conditions) paid by the Receivables Purchaser pursuant to that Invoice
Discounting Agreement less the amount (if any) received by the Receivables Purchaser by
way of repurchase consideration or indemnity from the relevant IDF Company, or from any
other Obligor, in respect of that Account;
	 
	 	 	Information Memorandum: the document in the form approved by BMUK concerning the Group
which, at BMUK’s request, and on its behalf, was prepared by the Arranger in relation to
the transactions contemplated by this Agreement and distributed to selected financial
institutions;
	 
	 	 	Inter Company Sale Agreement: the inter company sale agreement dated 17 March 2005 between
BMUK and the USD Co pursuant to which BMUK will sell US Inventory acquired by it to the
USD Co and the USD Co will, immediately prior to BMUK selling such US Inventory to its
customers, re-sell such US Inventory back to BMUK to enable BMUK to make such sales;
	 
	 	 	Intercompany Accounts: all assets and liabilities, however arising, which are due to any
Trading Company from, which are due from any Trading Company to, or which otherwise arise
from any transaction by any Trading Company with, any Affiliate;
	 
	 	 	Interest Period: any of those periods referred to in Clause 7 (Interest and Interest
Periods) (by reference to which interest is calculated on any LIBOR Revolving Loan) or in
Clause 18.2 (Default Interest Periods) (by reference to which interest is calculated on an
unpaid sum) provided that, save in respect of any Interest Periods relating to an unpaid
sum, no Interest Period shall extend beyond the Termination Date;
	 
	 	 	Inventory: in relation to each Trading Company, all of its now owned and hereafter
acquired inventory, goods and merchandise, wherever located, to be furnished under any
contract of service or held for sale or lease, all raw materials, work-in-progress,
finished goods, returned goods and materials and supplies of any kind, nature or
description which are or might be used or consumed in its business or used in connection
with the manufacture, packing, shipping, advertising, selling or finishing of such goods,
merchandise and other personal property, and all documents of title or other documents
representing them;





16









 






	 	 	Inventory Eligibility Date: the date, if any, upon which the Lenders shall have agreed,
and the Agent shall have advised BMUK to that effect, that Eligible Inventory may be
eligible as the basis for Revolving Loans;
	 
	 	 	Invoice Discounting Agreements: the Belgian Invoice Discounting Agreement, the French
Invoice Discounting Agreement and the Italian Invoice Discounting Agreement including, in
each case, the Account Transfer Conditions incorporated therein in accordance with their
respective terms together with any other Invoice Discounting Agreement entered into from
time to time by an IDF Company, including in each case, the Accounts Transfer Conditions
incorporated therein in accordance with their respective terms;
	 
	 	 	Invoice Discounting Facilities: the invoice discounting facilities made available or to be
made available to the IDF Companies under the Invoice Discounting Agreements;
	 
	 	 	Invoice Discounting Facility Exposure: at any time, the aggregate of the Total MDL Balance
(as defined in the Accounts Transfer Conditions) at such time, the sterling equivalent of
any Prepayments to be made on the date on which the computation falls to be made and the
sterling equivalent of all other amounts owing, actually or contingently, by the IDF
Companies under the Invoice Discounting Agreements at such time, as notified to the Agent
from time to time by each Receivables Purchaser;
	 
	 	 	Italian IDF Company: Bell Microproducts S.r.l, a corporation incorporated under the laws
of Italy with registered number 13456670150 and having its registered office at Via V
Pisani 12/a, 20124 Milan, Italy;
	 
	 	 	Italian Invoice Discounting Agreement: the invoice discounting agreement dated 15 December
2004 and made between the Italian IDF Company and Bank of America, National Association
acting through its Milan branch at Corso Matteotti 10,20121 Milan, Italy and includes any
agreement from time to time entered into in order to extend the validity of such invoice
discounting agreement in order to comply with Italian law;
	 
	 	 	Italian Bank Accounts Pledge: any pledge in respect of the Company Accounts of the Italian
IDF Company, in form and substance satisfactory to the Agent and the Receivables
Purchaser;
	 
	 	 	Latest Projections: the projections most recently received by the Agent pursuant to clause
15.2.3;
	 
	 	 	Lender: means:






	 	(i)	 	any Original Lender; and
	 
	 	(ii)	 	any bank, financial institution, trust, fund or other entity which has
become a party to this Agreement in accordance with Clause 28.3 (Assignments and
Transfers by Lenders),






	 	 	which in each case has not ceased to be a party to this Agreement in accordance with the
terms of this Agreement;
	 
	 	 	Letter of Credit: any standby letter of credit (which has been specifically agreed between
a Borrower and the Agent) issued by the Issuer at the request of a Borrower pursuant to
the terms of Clause 6.4 (Letters of Credit and Guarantees);
	 
	 	 	Letter of Credit and Guarantee Fee: the meaning given to it in Clause 22.5 (Letter of
Credit and Guarantee Fee);




17









 












	 	 	LIBOR: in relation to any LIBOR Revolving Loan or any unpaid sum and any Interest Period
relating to it:






	 	(i)	 	the applicable Screen Rate; or
	 
	 	(ii)	 	(if no Screen Rate is available for the currency or Interest Period of that
Loan or unpaid sum) the arithmetic mean of the rates (rounded up to 4 decimal places)
as supplied to the Agent at its request quoted by the Reference Banks to leading
banks in the London Interbank Market,






	 	 	at or about 11.00 a.m. in London on the Quotation Date for a period comparable to the
relevant Interest Period;
	 
	 	 	LIBOR Revolving Loan: a revolving loan made or to be made by the Lenders in relation to
which interest thereon is to be calculated by reference to LIBOR;
	 
	 	 	Loans: each Revolving Loan and Swingline Loan and “Loan” means any one of them;
	 
	 	 	Majority Lenders: Lenders whose Outstandings together exceed sixty-six and two-thirds per
cent (66 2/3%) of the Outstandings of all the Lenders (or, if there
are no Outstandings, Lenders whose Commitments together exceed sixty-six and two-thirds
per cent (66 2/3%) of the Total Commitments) provided that, if at
any time there are only two Lenders party to this Agreement “Majority Lenders” shall mean
both of them together;
	 
	 	 	Management Accounting Period: each period of one calendar month ending on the last day of
that month;
	 
	 	 	Management Accounts: the then latest unaudited but consolidated and consolidating
management accounts of BMEH, BMEP, BMEBV, BMEE, BMUK and the Group (other than the members
of the Restricted Group but including in any event each IDF Company) in respect of each
Management Accounting Period to be prepared in accordance with Applicable GAAP and in a
format agreed by the Agent required to be delivered to the Agent pursuant to Clause 15.2.2
(Management Accounts);
	 
	 	 	Mandatory Cost: the percentage rate per annum calculated by the Agent in accordance with
Schedule 5 (Mandatory Cost Formulae);
	 
	 	 	Material Contracts: each of the contracts details of which are set out in Schedule 10 (The
Material Contracts) and any other contract from time to time designated as a Material
Contract by the Agent and BMUK;
	 
	 	 	Maximum Eligibility Amount: the amount which is equal to the sum of:






	 	(a)	 	80% of the Net Amount of Eligible Accounts (the “Accounts Advance Rate”).
If at any time the Agent determines that the Dilution Percentage for the Borrowers
(as a whole) has been equal to or less than 5% for a continuous period of three (3)
months ending on the date of such determination, the Agent, in its absolute
discretion (upon completing a field exam and such other reviews as it deems
appropriate), may increase the Accounts Advance Rate to 85%. “Dilution Percentage”
means the percentage figure obtained by dividing (A) all credits, allowances,
discounts, write-offs, contra-accounts and other set-offs incurred in any month which
reduce the value of Accounts for the Borrowers (as a whole) by (B) the gross amount
of all cash received and retained in the Receivables Accounts from all Accounts
created by the Borrowers (as a whole) in such month; notwithstanding but without
prejudice to the foregoing, the Agent shall have the right to reduce the Accounts
Advance Rate or to establish





18









 











	 	 	 	reserves, if the Agent at any time determines that the Dilution Percentage has
increased; plus
	 
	 	(b)	 	after the Inventory Eligibility Date, if applicable, up to 60% of the value
of Eligible Inventory;






	 	 	Maximum Revolving Credit Line: the maximum amount which is available under this Agreement;
being £60,000,000 or, if the Agent has received a notice in accordance with Clause 2.7
(Increase of Maximum Revolving Credit Line) and the period referred to in Clause 2.7
(Increase of Maximum Revolving Credit Line) has expired, £76,000,000 (or such other amount
as may be agreed between the Agent and BMUK from time to time);
	 
	 	 	Net Amount of Eligible Accounts: the gross amount of Eligible Accounts less sales, excise
or similar taxes, and less returns, discounts, claims, credits and allowances of any
nature at any time issued, owing, granted, outstanding, available or claimed in respect of
such Eligible Accounts;
	 
	 	 	Non-Vesting Accounts: has the meaning given to it in the Accounts Transfer Conditions;
	 
	 	 	Notice of Conversion/Continuation: the meaning given to it in Clause 7.5.2 (Conversion and
Continuation of Revolving Loans);
	 
	 	 	Obligors: each Borrower, each Charging Company, each Guarantor and each other member of
the Group which has, or may be required by the Agent to have, any liability from time to
time, whether actual or contingent, present or future, for the payment of any amounts
outstanding or capable of becoming outstanding under any of the Finance Documents and
“Obligor” means any one of them;
	 
	 	 	Original Sterling Amount: in relation to a Loan, the amount specified in sterling in the
Utilisation Notice relating to that Loan (or, if the amount requested is denominated in a
Foreign Currency, that amount converted into sterling at the Agent’s Spot Rate of Exchange
on the date which is three business days before the Utilisation Date or, if later, on the
date the Agent received the Utilisation Notice);
	 
	 	 	Outstandings: in relation to a Lender at any time, the Original Sterling Amount of the
aggregate principal amount of its share of all (if any) Utilisations, including (in
relation to the Issuer) the Original Sterling Amount of the aggregate of its contingent
liabilities in respect of any such Utilisations consisting of the issue of any Letters of
Credit or Guarantees outstanding at that time;
	 
	 	 	Parent: Bell Microproducts Inc.;
	 
	 	 	Participating Proportion: in relation to a Lender and a sum payable to or by it on any
date, the proportion which the Commitment of that Lender bears to the Total Commitments on
that date;
	 
	 	 	Permitted Encumbrance: any encumbrance permitted under Clause 16.3.1 (Encumbrances);
	 
	 	 	Permitted Indebtedness: any indebtedness permitted under Clause 16.3.5 (Indebtedness);
	 
	 	 	Pledge Agreements: the Belgian Pledge, the French Bank Accounts Pledge and the Italian
Bank Accounts Pledge and any other pledge agreement from time to time entered into by an
IDF Company pursuant to the terms of an Invoice Discounting Agreement;
	 
	 	 	Pre-Approved Acquisition: any acquisition of any business, shares or other assets of any
kind by any Group Company which does not require the prior written consent or approval of
the





19









 






	 	 	Agent or the Lenders by virtue of the fact that both prior to and at the time of its
completion, each of the Approved Acquisition Conditions were satisfied;
	 
	 	 	Prepayment: the meaning given to it in the Accounts Transfer Conditions;
	 
	 	 	Qualifying Lender: a lender which either:






	 	(i)	 	is a bank as defined in section 840A of the Taxes Act which, for the
purposes of section 349 of the Taxes Act, is within the charge to corporation tax as
regards all interest payable to it under this Agreement; or
	 
	 	(ii)	 	is a lender (a “Treaty Lender") which has the benefit of a double tax
treaty which provides a complete exemption from UK income tax on interest; or
	 
	 	(iii)	 	is a lender (a “UK Non-Bank Lender") which is beneficially entitled to
interest payable to that lender in respect of a Loan under this Agreement and is:






	 	(a)	 	a company resident in the United Kingdom for United
Kingdom tax purposes;
	 
	 	(b)	 	a partnership each member of which is a company resident
in the United Kingdom for United Kingdom tax purposes; or
	 
	 	(c)	 	a company not so resident in the United Kingdom which
carries on a trade in the United Kingdom through a branch or agency and
which is required to bring that interest into account in computing its
chargeable profits (within the meaning given by section 11(2) of the Taxes
Act),






	 	 	and has given a Tax Confirmation to the Borrowers;
	 
	 	 	Quotation Date: in relation to any period for which an interest rate is to be determined,
the day on which quotations would ordinarily be given by prime banks in the London
Interbank Market for deposits in the currency in relation to which such rate is to be
determined for delivery on the first day of that period provided that, if, for any such
period, quotations would ordinarily be given on more than one date, the Quotation Date for
that period shall be the last of those dates;
	 
	 	 	Receivables Account: has the meaning given to it in the Security Documents;
	 
	 	 	Receivables Purchaser: Bank of America, N.A. in its capacity as receivables purchaser
under the Invoice Discounting Agreements;
	 
	 	 	Reference Banks: such banks as may be appointed by the Agent in consultation with BMUK;
	 
	 	 	Reference Rate: in relation to any Loan or unpaid sum denominated in sterling or any
Foreign Currency (as the case may be) on which interest is to be calculated by reference
to Reference Rate, the Agent’s reference rate for sterling or such Foreign Currency being
the rate from time to time set by the Agent based on various factors including the Agent’s
cost of funds, desired return and general economic conditions and which is used as a
reference point for pricing loans made by it in sterling or such Foreign Currency;
	 
	 	 	Reference Rate Revolving Loan: a revolving loan made or to be made by the Lenders in
relation to which interest thereon is to be calculated by reference to the Reference Rate;






20












 






	 	 	Reichl Standstill Agreement: the standstill agreement dated 23 November 2005 and made
between (1) Mr Klaus Reichl, (2) BMEH, (3) the Agent and the Security Trustee and (4) Bell
Microproducts Solutions GmbH;
	 
	 	 	Relevant Accounting Information: the meaning given to it in Clause 15.4 (Financial
Ratios);
	 
	 	 	Relevant Agreements: the Finance Documents, the Material Contracts and any Approved
Acquisition Documents;
	 
	 	 	Reservations: the principle that equitable remedies are remedies which may be granted or
refused at the discretion of the court, the limitation of enforcement by laws relating to
bankruptcy, insolvency, liquidation, reorganisation, court schemes, moratoria,
administration and other laws generally affecting the rights of creditors, the time
barring of claims under the Limitation Act 1980, the possibility that an undertaking to
assume liability for or to indemnify against non-payment of United Kingdom stamp duty may
be void, the unenforceability of penalty provisions and defences of set-off or
counterclaim and similar principles arising under the laws of any other jurisdiction in
which relevant obligations must be performed;
	 
	 	 	Restricted Group: collectively, Bell Microproducts BV, a company incorporated in The
Netherlands registered at the Flevoland Commercial Register with number KvK: 39061489, its
Subsidiaries for the time being and Bell Microproducts GmbH, a company incorporated in
Germany registered at the Munich Commercial Register with number HRB162143 and Bell
Microproducts Solutions NV, a company registered in Belgium in Mechelen with number 0461
3609 02 and “member of the Restricted Group” means any one of them but so that an IDF
Company shall be deemed not to be a member of the Restricted Group even if this is in fact
the case;
	 
	 	 	Restricted Investment: any acquisition of any assets by any Group Company in exchange for
cash or other assets, whether in the form of an acquisition of shares, debt securities or
other indebtedness or obligation, or the purchase or acquisition of any other assets, or a
loan, advance, capital contribution or subscription, except the following:






	 	(i)	 	acquisitions of fixed assets to be used in the business of such Group
Company, so long as the acquisition costs thereof constitute Capital Expenditure
permitted hereunder; and
	 
	 	(ii)	 	acquisitions of goods held for sale or lease or to be used in the rendering
of services by such Group Company in the ordinary course of business;
	 
	 	(iii)	 	any acquisition of shares, debt securities or other indebtedness or
obligation, or the making of any loan, advance, capital contribution or subscription
by any Group Company in or to any other Group Company which is loss-making and solely
for the purpose of recapitalising such loss-making Group Company, provided always
that, unless (A) the funds (the “investment funds”) employed by the investing Group
Company have been made available to it wholly by the Parent (directly or through
BMEH) and not by the utilisation of any amounts drawn down under this Agreement and
(B) the investment funds are the proceeds of a new capital injection (whether by way
of debt or equity) into the investing Group Company occurring after 20 October 2005
and not moneys already available to such investing Group Company, then such capital
injection by the relevant investing Group Company may not exceed £500,000 without the
prior written consent of the Agent;
	 
	 	(iv)	 	any Pre-Approved Acquisition;






	 	 	Revolving Facility: the facility referred to in Clause 2.1 (The Revolving Facility);




21









 






	 	 	Revolving Facility Amount: the lesser of:






	 	(i)	 	the Maximum Revolving Credit Line; and
	 
	 	(ii)	 	the Maximum Eligibility Amount;






	 	 	Revolving Loan: each LIBOR Revolving Loan and each Reference Rate Revolving Loan made or
to be made by the Lenders pursuant to the Revolving Facility;
	 
	 	 	Screen Rate: the British Bankers Association Interest Settlement Rate for the relevant
currency and period displayed on page 3750 of the Telerate screen; if the agreed page is
replaced or service ceases to be available, the Agent may specify another page or service
displaying the appropriate rate after consultation with BMUK and the Lenders;
	 
	 	 	Secured Guarantor: each Charging Company;
	 
	 	 	Secured Obligations: the meaning given to it in the Debenture;
	 
	 	 	Security Documents: the Debenture, the Priority Agreement, the Pledge Agreements and any
document creating an encumbrance over any asset of any Obligor and/or any IDF Company
entered into pursuant thereto or pursuant to any other Finance Document and any other
security document granted to the Security Trustee as security for the obligations of the
Obligors and/or any IDF Company to the Beneficiaries;
	 
	 	 	Security Interest: collectively the encumbrances granted to the Security Trustee pursuant
to the Security Documents or any other agreement or instrument;
	 
	 	 	St. Crispin Mortgagee: HSBC Bank PLC as mortgagee of the St. Crispin Property in
connection with such borrowing or such other bank or financial institution which may at
any time refinance all or any part of such borrowings, provided that such bank or
financial institution shall have entered into an intercreditor deed or other priority
arrangement on terms and conditions mutually acceptable to such bank or financial
institution, BMUK and the Agent;
	 
	 	 	St. Crispin Priority Agreement: the priority agreement, in form and substance satisfactory
to the Agent, entered or to be entered into between (1) BMUK, (2) the Security Trustee and
(3) HSBC Bank PLC;
	 
	 	 	St. Crispin Property: all that freehold property registered under title number LA596977
and more particularly known as land to the west side of St. Crispin Way, Haslingden,
Rossendale, Lancashire;
	 
	 	 	Subsidiary: of a person means any company or entity directly or indirectly controlled by
such person;
	 
	 	 	Supplemental Agreements: the agreements supplemental to this Agreement dated 3 December
2003, 22 September 2004, 15 December 2004, 17 March 2005, 16 August 2005, 20 October 2005,
2 January 2007 and 21 May 2008 entered into by the parties hereto;
	 
	 	 	Supplemental Deed: a deed supplemental to the Debenture or any other Security Document,
substantially in the form set out in schedule 9 to the Debenture or, as the case may be,
substantially in the form set out in such Security Document, entered or to be entered into
by a Group Company pursuant to which that Group Company accedes to the Debenture or, as
the case may be, any other Security Document, as a Charging Company;




22









 






	 	 	Swingline Loan: a swingline loan made or to be made by the Swingline Lender pursuant to
Clause 6.3 (Swingline Loans);
	 
	 	 	TARGET: the Trans-European Automated Real-time Gross Settlement Express Transfer payment
system which utilises interlinked national real time gross settlement systems and the
European Central Bank’s payment mechanism and which began operations on 4 January 1999.
	 
	 	 	TARGET2: 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:






	 	(a)	 	until such time as TARGET is permanently closed down and ceases operations, any day on
which both TARGET and TARGET2 are; and
	 
	 	(b)	 	following such time as TARGET is permanently closed down and ceases operations, any
day on which TARGET2 is,






	 	 	 open for the settlement of payments in euro.
	 
	 	 	Taxes Act: the Income and Corporation Taxes Act 1988;
	 
	 	 	Tax Confirmation: a confirmation by a person which is a Lender under this Agreement that
the person beneficially entitled to interest payable to that Lender in respect of a Loan
under this Agreement is either:






	 	(i)	 	a company resident in the United Kingdom for United Kingdom tax purposes;
or
	 
	 	(ii)	 	a partnership each member of which is a company resident in the United
Kingdom for United Kingdom tax purposes; or
	 
	 	(iii)	 	a company not so resident in the United Kingdom which carries on a trade
in the United Kingdom through a branch or agency and which is required to bring that
interest into account in computing its chargeable profits (within the meaning given
by section 11(2) of the Taxes Act);






	 	 	Termination Date: subject to Clause 9.5 (Extension of Termination Date), 20 October 2011;
	 
	 	 	Total Commitments: the aggregate at any time of the Commitments of all the Lenders;
	 
	 	 	Total Outstandings: the aggregate at any time of the Outstandings of all the Lenders;
	 
	 	 	Trading Company: each Group Company with Eligible Accounts and, if applicable following
the Inventory Eligibility Date, with such Eligible Inventory as the Agent may agree in
writing;
	 
	 	 	Transfer Certificate: a certificate substantially in the form set out in Schedule 6 (Form
of Transfer Certificate) completed in accordance with Clause 28 (Assignments and
Transfers);
	 
	 	 	Transferee: a Lender or other financial institution which is a Qualifying Lender to which
a Lender seeks to transfer rights and obligations under this Agreement in accordance with
Clause 28 (Assignments and Transfers);
	 
	 	 	Trust Property: all or any of the assets, rights, powers, authorities and discretions at
any time subject to or expressed to be subject to the security from time to time
constituted by or arising




23









 






	 	 	pursuant to the Security Documents or vested in the Security Trustee or given under or
pursuant to the Security Documents including all income and other sums at any time
received or receivable by the Security Trustee in respect thereof;
	 
	 	 	Unsecured Guarantor: BMEH, BMEP, Bell Microproducts S.a.r.l., Bell Microproducts S.r.l.,
Bell Microproducts BVBA and each other Group Company which from time to time accedes to
this Agreement as an unsecured guarantor by executing and delivering to the Agent an
Accession Notice in accordance with Clause 3 (Additional Borrowers and Unsecured
Guarantors) and “Unsecured Guarantor” means any one of them;
	 
	 	 	Unused Line Fee: the meaning given to it in Clause 22.1 (Unused Line Fee);
	 
	 	 	US Inventory: Inventory purchased by BMUK from third party suppliers where the purchase
price paid by BMUK to such third party suppliers is settled in dollars;
	 
	 	 	USD Co: Bell Microproducts (US) Limited (Company Number: 5305904) whose registered office
is at Cox Lane, Chessington, Surrey KT9 1SJ;
	 
	 	 	Utilisation: a utilisation consisting of the drawdown of a Swingline Loan or Revolving
Loan or the issue by the Issuer of a Letter of Credit or Guarantee;
	 
	 	 	Utilisation Notice: a notice of Utilisation substantially in the form set out in Schedule
4 (Form of Utilisation Notice); and
	 
	 	 	VAT: value added tax or any similar tax substituted therefor.
	 
	1.2	 	Construction
	 
	 	 	Any reference in this Agreement to:






	 	1.2.1	 	the “Agent”, the “Arranger”, the “Receivables Purchaser”, the “Security
Trustee”, the “Issuer”, the “Swingline Lender” or any “Lender” shall be construed so
as to include their respective successors, Transferees and assignees in accordance
with their respective interests;
	 
	 	1.2.2	 	“this Agreement” or to any other agreement or document shall, unless the
context otherwise requires, be construed as a reference to this Agreement or such
other agreement or document as the same may from time to time be amended, varied,
supplemented, novated or replaced and shall include any document which is
supplemental to, is expressed to be collateral with, or is entered into pursuant to
or in accordance with, the terms of this Agreement or, as the case may be, such other
agreement or document;
	 
	 	1.2.3	 	the “assets” of any person shall be construed as a reference to all or any
part of its business, operations, undertaking, property, assets, revenues (including
any right to receive revenues) and uncalled capital;
	 
	 	1.2.4	 	a “business day” is a reference to a day (other than a Saturday or Sunday)
on which banks generally are open for business in London and:






	 	(a)	 	(in relation to any date for the payment or purchase of a
currency other than euro) in the principal financial centre of the country
of that currency; or
	 
	 	(b)	 	(in relation to any date for the payment or purchase of
euro) which is a TARGET Day;




24









 












	 	1.2.5	 	a “capital adequacy regulation” shall be construed as a reference to any
guideline, request or directive of any central bank or public authority, or any other
law, rule or directive or regulation, whether or not having the force of law, in each
case, regarding capital adequacy of any bank or of any corporation controlling a
bank;
	 
	 	1.2.6	 	a document being a “certified copy” of another means such document is
certified by a duly authorised officer of the relevant Obligor (or by reputable
solicitors to the relevant Obligor from time to time) as being a true, complete,
accurate and up-to-date copy of the original;
	 
	 	1.2.7	 	a person being “controlled” by another means that that other (whether
directly or indirectly and whether by the ownership of share capital, the possession
of voting power, contract or otherwise) has the power to appoint and/or remove all or
the majority of the members of the board of directors or other governing body of that
person or otherwise controls or has the power to control the affairs and policies of
that person;
	 
	 	1.2.8	 	a “credit agreement” shall be construed as a reference to any conditional
sale agreement (as defined in the Consumer Credit Act 1974), hire purchase or credit
sale agreement or other similar agreement entered into primarily as a method of
financing the acquisition of the asset which is the subject of such agreement;
	 
	 	1.2.9	 	a Default which is “continuing” shall be construed as a reference to a
Default which has not been remedied or waived;
	 
	 	1.2.10	 	“dollars” and “US$” shall mean the lawful currency of the United States of America;
	 
	 	1.2.11	 	“EMU legislation” means legislative measures of the European Communities for the
introduction of, changeover to or operation of the euro;
	 
	 	1.2.12	 	an “encumbrance” shall be construed as a reference to a mortgage, charge,
assignment by way of security, pledge, lien, hypothecation, right of set-off,
reservation of title arrangement, preferential right (save as arising under the
general law for the protection of certain classes of creditors) or any trust, flawed
asset or other arrangement for the purpose of and having a similar effect to the
granting of security, or other security interest of any kind;
	 
	 	1.2.13	 	“euro” and “EUR” means the single currency adopted by certain participating member
states of the European Communities in accordance with EMU legislation;
	 
	 	1.2.14	 	a “finance lease” shall be construed as a reference to any lease or other similar
agreement entered into primarily as a method of financing the use of the asset which
is the subject of such lease or agreement;
	 
	 	1.2.15	 	"financial indebtedness” shall be construed as a reference to any indebtedness
under or in respect of:






	 	(a)	 	moneys borrowed or raised (including by way of preference
share capital but excluding by way or ordinary shares);
	 
	 	(b)	 	any debenture, bond, note, loan stock, commercial paper
or similar instrument;
	 
	 	(c)	 	any acceptance credit, bill-discounting, note purchase or
documentary credit facility;




25









 






	 	(d)	 	any credit agreement or finance lease;
	 
	 	(e)	 	any receivables purchase, factoring or discounting
arrangement under which there is recourse in whole or in part to any member
of the Group including, without limitation, the Invoice Discounting
Agreements;
	 
	 	(f)	 	credit (other than normal trade credit for a period not
exceeding 90 days) or deferred payment arrangements in respect of the
acquisition or construction price of assets acquired or constructed or the
purchase price of services supplied;
	 
	 	(g)	 	any other transaction having the commercial effect of a
borrowing or other raising of money entered into by a person to finance its
business or operations or capital requirements; or
	 
	 	(h)	 	(without double counting) any guarantee or other
assurance against financial loss in respect of the indebtedness of any
person arising under an obligation falling within (a) to (g) above;






	 	1.2.16	 	the “Financial Statements” or the “Management Accounts” shall be construed so as to
include any notes, reports, statements or other documents annexed or attached to any
of them;
	 
	 	1.2.17	 	a “guarantee” shall be construed so as to include an indemnity, bond, standby
letter of credit and any other obligation (whatever called) of any person to pay for,
purchase, provide funds (whether by the advance of money, the purchase or
subscription for shares or other securities, the purchase of assets or services or
otherwise) for the payment of, indemnify against the consequences of default in the
payment of, or otherwise be responsible for, any indebtedness or other obligation of
any other person (and “guaranteed” and “guarantor” shall be construed accordingly);
	 
	 	1.2.18	 	“indebtedness” shall be construed as a reference to any obligation for the payment
or repayment of money, whether as principal or as surety and whether present or
future, actual or contingent;
	 
	 	1.2.19	 	a document expressed to be “in the approved terms” is a reference to a document the
terms, conditions and form of which have been initialled for the purpose of
identification by or on behalf of the Agent;
	 
	 	1.2.20	 	something having a “material adverse effect” on a person shall be construed as a
reference to it having a material adverse effect (i) on its financial condition,
business or operations or on the consolidated financial condition, business or
operations of it and its Subsidiaries or (ii) on its ability to comply with its
payment obligations under any Finance Document;
	 
	 	1.2.21	 	a “month” is a reference to a period starting on one day in a calendar month and
ending on the numerically corresponding day in the next calendar month save that,
where any such period would otherwise end on a day which is not a business day, it
shall end on the next business day, unless that day falls in the calendar month
succeeding that in which it would otherwise have ended, in which case it shall end on
the preceding business day provided that, if a period starts on the last business day
in a calendar month or if there is no numerically corresponding day in the month in
which that period ends, that period shall end on the last business day in that later
month;




26









 






	 	1.2.22	 	a “participating member state” is a reference to any member state of the European
Communities which adopts or has adopted the euro as its lawful currency in accordance
with EMU legislation;
	 
	 	1.2.23	 	a “person” shall be construed as a reference to any individual, firm, company,
corporation, public authority or any association or partnership (whether or not
having separate legal personality) of two or more of the foregoing;
	 
	 	1.2.24	 	a “public authority” shall be construed as a reference to any government of any
country or sovereign state or any political sub-division thereof or any department,
agency, public corporation or other instrumentality of any of the foregoing;
	 
	 	1.2.25	 	a “regulation” shall be construed so as to include any regulation, rule, by-law,
official directive, requirement, request or guideline (whether or not having the
force of law) of any governmental body, agency, department or regulatory,
self-regulatory or other authority or organisation;
	 
	 	1.2.26	 	“sterling” and “£” denotes the lawful currency of the United Kingdom;
	 
	 	1.2.27	 	the “sterling equivalent” of (i) any amount denominated in a Foreign Currency shall
mean the equivalent in sterling of such amount as determined by the Agent by
reference to the Agent’s Spot Rate of Exchange and of (ii) any amount denominated in
sterling shall mean such sterling amount;
	 
	 	1.2.28	 	“tax” shall be construed so as to include any present and future tax, levy, impost,
deduction, withholding, duty or other charge of a similar nature (including, without
limitation, any penalty or interest payable in connection with any failure to pay or
any delay in paying any of the same);
	 
	 	1.2.29	 	“tax on overall net income” of a person shall be construed as a reference to tax
(other than tax deducted or withheld from any payment) imposed on that person by the
jurisdiction in which its principal office (and/or, in the case of a Lender, its
Facility Office) is located on (i) the net income, profits or gains of that person
world-wide or (ii) such of its net income, profits or gains as arise in or relate to
that jurisdiction;
	 
	 	1.2.30	 	an “unpaid sum” is a reference to an unpaid sum as that term is defined in clause
18.1;
	 
	 	1.2.31	 	the “winding-up”, “dissolution”, “administration”, “receivership” or “bankruptcy”
of a person and references to the “liquidator”, “administrator”, “receiver”,
“administrative receiver”, “receiver and manager”, “manager” or “trustee” of a person
shall be construed so as to include any equivalent or analogous proceedings or, as
the case may be, insolvency representative or officer under the law of the
jurisdiction in which such person or, as the case may be, insolvency representative
or officer is incorporated or constituted or of any jurisdiction in which such person
or, as the case may be, insolvency representative or officer, carries on business.






	1.3	 	Any reference in this Agreement to any statute or statutory provision shall, unless the
context otherwise requires, be construed as a reference to such statute or statutory provision
(including all instruments, orders or regulations made thereunder or deriving validity
therefrom) as in force at the date of this Agreement and as subsequently re-enacted or
consolidated.
	 
	1.4	 	Any reference in this Agreement to a time of day shall, save where the context otherwise
requires, be construed as a reference to London time.




27









 






	1.5	 	In construing this Agreement general words introduced by the word “other” shall not be given
a restrictive meaning by reason of the fact that they are preceded by words indicating a
particular class of acts, matters or things and general words shall not be given a restrictive
meaning by reason of the fact that they are followed by particular examples intended to be
embraced by the general words.
	 
	1.6	 	The illegality, invalidity or unenforceability of any provision of this Agreement under the
law of any jurisdiction shall not affect its legality, validity or enforceability under the
law of any other jurisdiction nor the legality, validity or enforceability of any other
provision of this Agreement.
	 
	1.7	 	This Agreement supersedes any previous agreement, whether written or oral, express or
implied, between the Original Borrowers, the Arranger, the Agent, the Security Trustee and the
Lenders, or any of them, in relation to the subject matter of this Agreement.
	 
	1.8	 	The headings in this Agreement are for convenience only and shall not affect its meaning and
references to a clause, Schedule or paragraph are (unless otherwise stated) to a clause of, or
schedule to, this Agreement and to a paragraph of the relevant Schedule.
	 
	1.9	 	This Agreement may be signed in any number of counterparts, all of which taken together shall
constitute one and the same instrument. Any party may enter into this Agreement by signing
any such counterpart.
	 
	1.10	 	Save where the context otherwise requires, the plural of any term includes the singular and
vice versa.
	 
	1.11	 	Except as provided in Clause 27.13 (Indemnity Provisions), the terms of this Agreement may
only be enforced by a party to it and the operation of the Contracts (Rights of Third Parties)
Act 1999 is excluded. Notwithstanding such clause, the parties to this Agreement do not
require the consent of any third party to rescind or vary this Agreement or any Finance
Document at any time.
	 
	1.12	 	Nothing in this Agreement or envisaged hereby shall operate, whether directly or indirectly,
to constitute a partnership between any Obligor and any of the Beneficiaries.
	 
	1.13	 	The liabilities and obligations of the Obligors under the Finance Documents to which each of
them is expressed to be a party are and shall be construed as being, joint and several.
	 
	2.	 	THE REVOLVING FACILITY
	 
	 	 	The Revolving Facility
	 
	2.1	 	Subject to the terms and conditions of this Agreement, the Lenders shall make available to
the Borrowers a revolving credit facility (the “Revolving Facility”) of up to the Maximum
Revolving Credit Line. The Revolving Facility (as described in Clause 6 (Utilisation of the
Revolving Facility)) shall consist of Revolving Loans (to be denominated in sterling and/or,
if agreed between the relevant Borrower and the Agent, dollars, euro or one or more other
Foreign Currencies) to be made by the Lenders and, if specifically agreed by the Agent (on the
instructions of the Issuer), Letters of Credit and/or Guarantees to be issued by the Issuer
(subject to reimbursement by the relevant Borrower and each of the Lenders on the terms set
out in this Agreement) and Swingline Loans (to be denominated in sterling and/or dollars,
euros or such one or more other Foreign Currencies as may be agreed between the relevant
Borrower and the Swingline Lender), to be made by the Swingline Lender (subject to
reimbursement by the Lenders on the terms set out in this Agreement) in a maximum aggregate
principal Original Sterling Amount not exceeding the Revolving Facility Amount.




28









 






	 	 	Purpose
	 
	2.2	 	The Revolving Facility is to be applied to meet each Borrower’s general working capital
purposes and each Borrower shall apply all amounts raised by it under this Agreement
accordingly provided that none of the Agent, the Security Trustee or any of the Lenders shall
be obliged to concern itself with the application of amounts raised by any Borrower under this
Agreement.
	 
	 	 	Obligations Several
	 
	2.3	 	The obligations of each Lender under this Agreement are several. The failure by any Lender
to perform its obligations under this Agreement shall not affect the obligations of any
Obligor towards any other party to this Agreement nor shall any such other party be liable for
the failure by such Lender to perform its obligations.
	 
	 	 	Rights Several
	 
	2.4	 	The rights of each Lender are several. The amount at any time owing by any Borrower to any
party under this Agreement shall be a separate and independent debt from the amount owing to
any other party.
	 
	 	 	Financial Assistance
	 
	2.5	 	None of the proceeds of any Utilisation of the Revolving Facility under this Agreement may be
used in any way which infringes section 151 Companies Act 1985 or any similar or other
statutory obligation whether in the United Kingdom or elsewhere unless the provisions of
sections 155 to 158 thereof are actually complied with.
	 
	 	 	Continuing Obligations
	 
	2.6	 	The obligations of any party under or in respect of Clauses 10 (Taxes), 11 (Increased Costs),
18 (Default Interest), 19 (Indemnities and Currency of Account), 20.7 (Refunding of Payments),
24 (Costs, Expenses and Stamp Duties) and 26.9 (Indemnity) shall continue even after the date
(the “Discharge Date”) upon which the Total Commitments have been cancelled or otherwise
reduced to zero and the Outstandings of all the Lenders have been permanently repaid or
prepaid, to the extent of and in respect of any cost, expense, loss, liability or claim
indemnifiable under any such clause and suffered or incurred by any Beneficiary on or prior to
the Discharge Date
	 
	 	 	Increase of Maximum Revolving Credit Line
	 
	2.7	 	BMUK may, by not less than 30 days’ prior written notice to the Agent, request that the
Maximum Revolving Credit Line be increased from £60,000,000 to £76,000,000. Upon receipt of
such notice, the Agent shall notify the Lenders and, upon the expiry of such period, the
Maximum Revolving Credit Line shall be increased to £76,000,000. The Lenders shall enter into
such documents and other agreements and carry out such actions as the Agent may require to
give effect to such increase.
	 
	3.	 	ADDITIONAL BORROWERS AND UNSECURED GUARANTORS
	 
	 	 	Request or requirement
	 
	3.1	 	BMUK may request that any Group Company shall become an Additional Borrower or, as
applicable, the Agent may require that any Group Company shall become an Unsecured Guarantor
by giving to the Agent or, as applicable, to BMUK not less than 10 business days’




29









 












	 	 	 notice. For the avoidance of doubt, any Additional Borrower shall, unless the Agent
otherwise agrees, automatically be required also to become a Charging Company pursuant to
Clause 4 (Additional Charging Companies), without the need for the Agent to serve a
further notice in accordance with Clause 4 (Additional Charging Companies).
	 
	 	 	Accession
	 
	3.2	 	The Group Company in respect of which the request or, as the case may be, requirement is made
pursuant to Clause 3.1 (Request or Requirement) shall become an Additional Borrower or, as
applicable, an Unsecured Guarantor:






	 	3.2.1	 	if the Lenders approve or, as applicable, require the addition of that
Group Company as an Additional Borrower or, as applicable, as an Unsecured Guarantor;
	 
	 	3.2.2	 	upon BMUK delivering to the Agent a duly completed and executed Accession
Notice;
	 
	 	3.2.3	 	in the case of a request to appoint an Additional Borrower, if no Default
has occurred or is likely to occur as a result of that Group Company becoming an
Additional Borrower;
	 
	 	3.2.4	 	if the Agent has received all of the documents and other evidence
specified in Schedule 9 (Documents to accompany Accession Notice or Supplemental
Deed) in relation to that Group Company and each is in form and substance
satisfactory to the Agent.






	 	 	For the avoidance of doubt, no Accounts or Inventory of any Group Company which is to
become an Additional Borrower shall be considered as Eligible Accounts or Eligible
Inventory, unless the Agent has completed a field examination and such other due diligence
as the Agent may require and such Accounts and Inventory satisfy the applicable conditions
set forth in this Agreement.
	 
	 	 	Timing
	 
	3.3	 	The Agent shall notify BMUK and the Lenders promptly upon being satisfied that it has
received all of the documents and other evidence specified in Schedule 9 (Documents to
accompany Accession Notice or Supplemental Deed) in relation to the relevant Group Company and
that each is in form and substance satisfactory to it, whereupon subject always to Clauses
3.2.1, 3.2.2 and, in the case of a proposed Additional Borrower, Clause 3.2.3, the relevant
Group Company shall become an Additional Borrower or, as applicable, an Unsecured Guarantor.
	 
	 	 	BMUK as agent
	 
	3.4	 	Each Borrower and each Unsecured Guarantor shall be deemed to appoint BMUK as its agent for
the purposes of the Finance Documents by its execution of an Accession Notice. The Agent may
rely on a document signed by BMUK as if it had been signed by any other Borrower or any
Unsecured Guarantor. BMUK may give a good receipt for any sum payable by any Finance Party to
any other Borrower or an Unsecured Guarantor. Any communication delivered to BMUK shall be
deemed to have been delivered to each of the Borrowers and each Unsecured Guarantor. Any
communication made by BMUK to the Agent or any other Finance Party shall, to the extent
permissible by law, be deemed to have been made with the consent of each other Borrower and
each Unsecured Guarantor.




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	 	 	Repetition of Representations
	 
	3.5	 	Delivery of an Accession Notice constitutes confirmation by the relevant Additional Borrower
or, as applicable, Unsecured Guarantor that the representations and warranties set out in
Clause 14.1 (General Representations and Warranties) which are required to be repeated
pursuant to Clause 14.3 (Repetition) are true and correct in all material respects in relation
to it as at the date of delivery as if made by reference to the facts and circumstances then
existing.
	 
	 	 	Invoice Discounting Agreements
	 
	3.6	 	By executing an Accession Notice an Additional Borrower shall accede to, and be bound by, the
IDF Guarantee as if it had been named in clause 7 (Guarantee) of the Supplemental Agreement
dated 15 December 2004 as a Borrower.
	 
	4.	 	ADDITIONAL CHARGING COMPANIES
	 
	 	 	Requirement
	 
	4.1	 	The Agent (acting on the instructions of the Lenders) may require that any Group Company
becomes a Charging Company by giving to BMUK not less than 10 business days’ notice, provided
that any Group Company which has acceded to this Agreement as an Additional Borrower shall,
unless the Agent otherwise agrees, automatically be required to become a Charging Company
without the need for the Agent to serve a notice under this Clause 4 (Additional Charging
Companies).
	 
	 	 	Accession
	 
	4.2	 	The Group Company in respect of which the requirement is made (or, in the case of an acceding
Additional Borrower, is deemed to have been made) pursuant to Clause 4.1 (Requirement) shall
become a Charging Company:






	 	4.2.1	 	(other than in the case of a Group Company acceding to this Agreement as
an Additional Borrower (in which case, accession as a Charging Company shall, unless
the Agent otherwise agrees, be automatic)), if the Lenders require the addition of
that Group Company as a Charging Company;
	 
	 	4.2.2	 	upon BMUK delivering to the Agent a duly completed and executed
Supplemental Deed or such other security document as the Agent may require in form
and substance satisfactory to the Agent;
	 
	 	4.2.3	 	if no Default has occurred or is likely to occur as a result of that Group
Company becoming a Charging Company; and
	 
	 	4.2.4	 	if the Agent has received all of the following documents and other
evidence in relation to that Group Company specified in Schedule 9 (which shall be
required to be delivered within 60 days of receipt (or deemed receipt) of notice
under Clause 4.1 (Requirement)) and each is in form and substance satisfactory to the
Agent.






	 	 	Timing
	 
	4.3	 	The Agent shall notify BMUK and the Lenders promptly upon being satisfied that it has
received all of the documents and other evidence specified in Schedule 9 (Documents to
accompany Accession Notice or Supplemental Deed) in relation to the relevant Group Company and
that each is in form and substance satisfactory to it, whereupon subject always to Clauses
4.2.1 to 4.2.3 (inclusive) the relevant Group Company shall become a Charging Company.




31









 






	 	 	BMUK as agent
	 
	4.4	 	Each Charging Company shall be deemed to appoint BMUK as its agent for the purposes of the
Finance Documents by its execution of a Supplemental Deed or other Security Document. The
Agent may rely on a document signed by BMUK as if it had been signed by each other Charging
Company. BMUK may give a good receipt for any sum payable by any Beneficiary to each other
Charging Company. Any communication delivered to BMUK shall be deemed to have been delivered
to each of the Charging Companies. Any communication made by BMUK to the Agent shall, to the
extent permissible by law, be deemed to have been made with the consent of each other Charging
Company.
	 
	 	 	Repetition of Representations
	 
	4.5	 	Delivery of a Supplemental Deed constitutes confirmation by the relevant Charging Company
that the representations and warranties set out in Clause 14.1 (General representations and
Warranties) which are required to be repeated pursuant to Clause 14.3 (Repetition) are true
and correct in all material respects in relation to it as at the date of delivery as if made
by reference to the facts and circumstances then existing.
	 
	5.	 	CONDITIONS PRECEDENT
	 
	 	 	The Lenders shall be under no obligation to make the Revolving Facility available under
this Agreement unless the Agent has received, or the Lenders are satisfied that the Agent
will receive at the same time as or immediately prior to the making available of the
Revolving Facility, in form and substance satisfactory to it, all of the documents and
evidence referred to in Schedule 2 (Conditions Precedent) (save to the extent that the
Agent may at any time waive such receipt).
	 
	6.	 	UTILISATION OF THE REVOLVING FACILITY
	 
	 	 	General Conditions of Utilisation
	 
	6.1	 	The Lenders shall not be obliged to make the Revolving Facility available and no Utilisation
Notice in respect of the Revolving Facility shall become effective unless the provisions with
respect to Excess Availability outlined at Clause 16.2.14 (Excess Availability) are complied
with;
	 
	 	 	and either:






	 	6.1.1	 	no Default has occurred and is continuing or would occur if the Revolving
Facility was made available and the representations set out in Clauses 14.1 (General
Representations and Warranties) and 14.2 (Accounts and Inventory) to be repeated on
and as of the proposed date for the making available of the Revolving Facility are
true and correct in all material respects on and as of such date; or
	 
	 	6.1.2	 	the Lenders have agreed (notwithstanding any such matter) to make the
Revolving Facility available and no notice of termination of this Agreement has been
given by BMUK as referred to in Clause 29 (Term and Termination).






	 	 	Revolving Loans
	 
	6.2	 	Subject to the terms of this Agreement, a Revolving Loan will be made by the Lenders to a
Borrower on its request if:




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	 	6.2.1	 	not later than 11.00 a.m. on the business day immediately prior to the day
which is the proposed date for the making of such Revolving Loan (or three business
days in the case of any Revolving Loan to be denominated in a Foreign Currency), or
such lesser period as the Agent may agree prior to the proposed date for the making
of such Revolving Loan, the Agent has received from the relevant Borrower a
Utilisation Notice in respect of such Revolving Loan;
	 
	 	6.2.2	 	the proposed date for the making of such Revolving Loan is a business day
during the Commitment Period;
	 
	 	6.2.3	 	the Original Sterling Amount of the proposed amount of such Revolving Loan
is a minimum amount of £3,000,000 and an integral multiple of £1,000,000 (or, where
the Revolving Loan is to be made pursuant to Clause 6.8.3 (Refunding of Swingline
Loans by the Lenders), an amount equal to the Original Sterling Amount of the
aggregate principal amount of the Swingline Loans then outstanding) which is less
than or equal to the lesser of the amount of the Available Facility and the Available
Revolving Facility Amount; and
	 
	 	6.2.4	 	the proposed Interest Period in respect of such Revolving Loan is a period
of one, two or three months (or such other period as the Agent may agree) ending on
or before the Termination Date.






	 	 	Swingline Loans
	 
	6.3	 	Subject to the terms of this Agreement, a Swingline Loan (which may be denominated in
sterling, dollars, euro or such other Foreign Currency as the Swingline Lender may agree) will
be made by the Swingline Lender to a Borrower on its request if:






	 	6.3.1	 	not later than 11.00 a.m. on the day which is the proposed date for the
making of such Swingline Loan, the Agent has received from the relevant Borrower a
Utilisation Notice in respect of such Swingline Loan;
	 
	 	6.3.2	 	the proposed date for the making of such Swingline Loan is a business day
during the Commitment Period.






	 	 	Letters of Credit and Guarantees
	 
	6.4	 	Subject to the terms of this Agreement, if the Agent agrees with a Borrower (acting on the
instructions of the Issuer), the Issuer shall, at that Borrower’s request (contained in a
Utilisation Notice) issue one or more documentary letters of credit (each a “Letter of
Credit”) or Guarantees (each a “Guarantee”), in each case denominated in sterling or any
Foreign Currency as the Issuer may agree, for that Borrower’s account. The Issuer will not
issue any Letter of Credit or Guarantee:






	 	6.4.1	 	if the Original Sterling Amount of the maximum face amount of the
requested Letter of Credit or of the maximum contingent liability under the requested
Guarantee, in each case plus all commissions, fees and charges due from the relevant
Borrower in connection with its issue, would cause its Available Commitment or the
Available Revolving Facility Amount to be exceeded at such time;
	 
	 	6.4.2	 	if the expiry date of the Letter of Credit or Guarantee would be later
than 30 days prior to the Termination Date or a date falling more than 12 months from
its date of issue;
	 
	 	6.4.3	 	if the Original Sterling Amount of the maximum face amount of the
requested Letter of Credit or of the maximum contingent liability under the requested
Guarantee, when




33









 






	 	 	 	aggregated with the Original Sterling Amount of the maximum face value of all
Letters of Credit and of the maximum contingent liability under all Guarantees,
in each case then in issue, would exceed £5,000,000,






	 	 	unless the Issuer has specifically agreed with that Borrower that it is prepared to do so.
	 
	 	 	Utilisation Notices





6.5





	 	6.5.1	 	Subject to the terms of this Agreement, each Utilisation Notice shall be
irrevocable and shall oblige the relevant Borrower to borrow the amount so requested
or, as the case may be, to give effect to the Utilisation so requested on the date
specified in such Utilisation Notice upon the terms and subject to the conditions set
out in this Agreement.
	 
	 	6.5.2	 	The first Utilisation Notice delivered hereunder shall include a request
to draw down as part of the relevant Revolving Loan an amount equal to the amount of
any fees then due and payable to the Arranger, the Agent and the Lenders and to such
other valuers and professional advisers as shall have been agreed with the Agent and
the Lenders as being payable therefrom and an authorisation and direction to the
Agent to appropriate for such purpose the proceeds of so much of the relevant
Revolving Loan as is required to satisfy the payment in full of such fees.






	 	 	Termination of Commitments
	 
	6.6	 	If it has not already been cancelled or otherwise reduced to zero prior to such time the
Commitment of each of the Lenders shall be reduced to zero at close of business in London on
the last day of the Commitment Period.
	 
	 	 	Special Provisions relating to Revolving Loans
	 
	6.7	 	
	 
	 	 	Agent’s right to exceed limits






	 	6.7.1	 	The Agent, in its discretion, may elect to allow the limits of the
Available Revolving Facility Amount to be exceeded on one or more occasions, provided
that the Agent may never exceed the Maximum Revolving Credit Line. If the Agent does
exceed the limits of the Available Revolving Facility Amount, it may not do so by an
amount which exceeds five (5) per cent. of the amount of the Maximum Revolving Credit
Line and if it does exceed the limits of the Available Revolving Facility Amount on
any occasion, the Agent shall not be deemed thereby to have changed such limits or to
be obliged to exceed such limits on any other occasion.






	 	 	Sharing of Applicable Margin






	 	6.7.2	 	On the first business day of each month following a month in which a
Reference Rate Revolving Loan shall have been outstanding and on the first business
day of the next Interest Period following an Interest Period during which a LIBOR
Revolving Loan shall have been outstanding, the Agent shall pay to each of the
Lenders an amount equal to each such Lender’s Participating Proportion of the
interest which would have been payable on any Reference Rate Revolving Loan
outstanding during that month or, as the case may be, on any LIBOR Revolving Loan
outstanding during that Interest Period, if such interest had been calculated on the
basis of the Applicable Margin less




34









 






	 	 	 	0.25% provided that the Agent shall have actually received all interest due from
the relevant Borrowers on such Reference Rate Revolving Loans or LIBOR Revolving
Loans at the rates applicable to them. Each Lender agrees that the Agent shall
pay such additional interest actually received from the Borrowers above that paid
to the Lenders in accordance with this Clause 6.7 (Special Provisions relating to
Revolving Loans) to Bank of America, National Association (in its capacity as a
Lender) for its own account.






	 	 	Special Provisions relating to Swingline Loans
	 
	6.8	 	
	 
	 	 	Notification






	 	6.8.1	 	The Swingline Lender shall notify the Agent and the Lenders at the end of
each week of the net amount of Swingline Loans then outstanding.






	 	 	Repayment of Swingline Loans






	 	6.8.2	 	The principal amount of the Swingline Loans denominated in any currency
shall be repaid on a daily basis by the transfer of the full credit balance on each
Receivables Account to any loan account denominated in that currency maintained by
each Borrower with the Agent as contemplated in Clause 20.8 (Debit to Loan Account)
or otherwise on demand by the Swingline Lender, any such credit balance denominated
in any particular currency to be applied first to the unpaid principal amount of
Swingline Loans denominated in the same currency and thereafter in or towards
repayment of the unpaid principal amount of any Swingline Loans denominated in any
other currency, the manner and extent of such application to be at the Agent’s
discretion.






	 	 	Refunding of Swingline Loans by the Lenders






	 	6.8.3	 	The Agent will not less than weekly and may, at any time in its sole and
absolute discretion or upon request of the Swingline Lender, on behalf of the
Borrowers (each of which hereby irrevocably directs the Agent to act on its behalf in
this respect), give notice to the Lenders (including the Swingline Lender) requiring
that they make a Reference Rate Revolving Loan to the relevant Borrower in an amount
equal to the aggregate principal amount of the Swingline Loans then outstanding
together with all interest accrued thereon but unpaid. Interest on any such
Reference Rate Revolving Loan shall be calculated and payable in accordance with the
provisions of Clause 7.2.2.
	 
	 	6.8.4	 	Application of Reference Rate Revolving Loans: Regardless of whether the
conditions in this Agreement for the making of Revolving Loans are then satisfied,
each Lender shall make its share of any Reference Rate Revolving Loan referred to in
Clause 6.8.3 (Refunding of Swingline Loans by the Lenders) available to the Agent for
the benefit of the Swingline Lender on the date notice of the requirement for any
such Reference Rate Revolving Loan is given to the Lenders.






	 	 	Special Conditions for Issue of Letters of Credit and Guarantees






	6.9	 	 	In addition to being subject to the satisfaction of the applicable conditions precedent
referred to in Clause 5 (Conditions Precedent), the obligation of the Issuer to issue any
Letter of Credit or Guarantee is subject to the following conditions having been satisfied in
a manner satisfactory to the Agent:




35









 






	 	6.9.1	 	the relevant Borrower shall have delivered to the Agent, at such times and
in such manner as the Agent may prescribe, an application in form and substance
satisfactory to the Agent for the issue of the Letter of Credit or Guarantee and such
other documents as may be required pursuant to the terms thereof;
	 
	 	6.9.2	 	the form and terms of the proposed Letter of Credit or Guarantee shall be
satisfactory to the Agent and the Issuer; and
	 
	 	6.9.3	 	as of the date of issue, no order of any court, arbitrator or public
authority shall purport by its terms to prohibit or restrain the Issuer or banks
generally from issuing letters of credit or guarantees of the type and in the amount
of the proposed Letter of Credit or Guarantee (as the case may be), and no law, rule
or regulation applicable to the Issuer or banks generally and no request or directive
(whether or not having the force of law) from any central bank or public authority
with jurisdiction over the Issuer or banks generally shall prohibit, or request that
the Issuer refrain from, the issue of letters of credit or guarantees generally or
the issue of such Letter of Credit or Guarantee.






	 	 	General Conditions for issue of Letters of Credit and Guarantees
	 
	6.10	 	
	 
	 	 	Requests for issue of Letters of Credit or Guarantees






	 	6.10.1	 	A Borrower shall give to the Agent four business days’ prior written notice of that
Borrower’s request for the issue of any Letter of Credit or Guarantee. In the case of
a Guarantee, such notice shall specify the maximum contingent liability to be
guaranteed, the beneficiary in whose favour the Guarantee is to be issued, the
effective date of issue of such Guarantee (which shall be a business day), details of
the obligation in respect of which the contingent liability might arise and the date
on which such obligation is due to mature or expire. In the case of a Letter of
Credit, such notice shall specify the original face amount and currency denomination
of the Letter of Credit requested, the effective date of issue of such Letter of
Credit (which shall be a business day), whether such Letter of Credit may be drawn in
a single or partial draws, the date on which such Letter of Credit is to expire and
the beneficiary of such Letter of Credit.






	 	 	No extensions or amendment:






	 	6.10.2	 	The Issuer shall not be obliged to extend or amend or cause to be extended or
amended any Letter of Credit or Guarantee it has issued.






	 	 	Events of Default






	 	6.10.3	 	The Issuer need not, before issuing a Letter of Credit or Guarantee, make any
enquiry or otherwise concern itself as to whether any event has occurred which, under
the terms hereof, would relieve the Issuer from its obligations to issue that Letter
of Credit or Guarantee and accordingly none of the Borrowers nor any of the Lenders
shall have any right to resist any claim under Clause 6.12 (Payments pursuant to
Letters of Credit or Guarantees) nor otherwise on the ground that any such event had
occurred before the issue of the Letter of Credit or Guarantee, provided that, before
issuing a Letter of Credit or Guarantee, the Issuer shall inform each of the Lenders
of any Event of Default of which it has actual notice.




36









 












	 	 	Compensation for Letters of Credit and Guarantees
	 
	6.11	 	Each Borrower agrees to pay to the Agent for the account of the Issuer with respect to each
Letter of Credit or Guarantee, the Letter of Credit and Guarantee Fee and such other
reasonable fees and other charges as are charged by the Issuer for letters of credit or
guarantees issued by it including, without limitation its standard fees for issuing,
administering, amending, renewing, paying and cancelling letters of credit and guarantees and
all other fees associated with issuing or servicing letters of credit, as and when assessed,
all as specified in Clause 22.5 (Letter of Credit and Guarantee Fee).
	 
	 	 	Payments pursuant to Letters of Credit and Guarantees
	 
	6.12	 	
	 
	 	 	Demands under a Letter of Credit or Guarantee






	 	6.12.1	 	If a demand for payment is made under a Letter of Credit or Guarantee on the
Issuer, the Issuer shall promptly notify the Agent of such demand and pay the sum
demanded in accordance with the terms of the relevant Letter of Credit or Guarantee,
whereupon:






	 	(a)	 	the Agent shall not later than four hours after receipt
of such demand, if such demand is made prior to 1.00 p.m. on any business
day, or otherwise by 10.00 a.m. on the next succeeding business day, notify
each Lender of the amount of such demand and such Lender’s proportion
thereof which such Lender shall be obliged to pay; and
	 
	 	(b)	 	each Lender shall on the date of such notification make
its share of the amount demanded available to the Agent for the benefit of
the Issuer in immediately available funds.






	 	 	 	If any Lender is unable to make its share of such amount available on such date,
it shall nevertheless do so as soon as possible thereafter and in any event by no
later than two business days after the date notice of such requirement was given
to it by the Agent, together with interest thereon from the date of such notice
to the date of payment at the rate specified by the Agent as representing the
Issuer’s cost of funds.






	 	 	Indemnity






	 	6.12.2	 	Each Borrower agrees to indemnify and hold harmless the Issuer in sterling or
sterling equivalent from and against all claims, demands, liabilities, damages,
losses, costs, charges and expenses (including reasonable legal fees) which the
Issuer may incur or sustain as a consequence of the issue of any Letter of Credit or
Guarantee or the performance of its obligations thereunder (save where the same are
caused by the Issuer’s gross negligence or wilful misconduct). This is a continuing
indemnity, extends to the ultimate balance of each Borrower’s obligations and
liabilities under clause 6 and shall continue in force notwithstanding any
intermediate payment in whole or in part of those obligations or liabilities.






	 	 	Payment of Letter of Credit or Guarantee obligations






	 	6.12.3	 	Without limiting or affecting any of the provisions of this Clause 6.12 (Payments
pursuant to Letters of Credit and Guarantees), each Borrower agrees to reimburse the
Agent and each Lender for any draw under any Letter of Credit or Guarantee
immediately upon demand, and to pay the Agent the amount of all other obligations and
other amounts payable to it under or in connection with any Letter of Credit or




37









 






	 	 	 	Guarantee immediately when due, irrespective of any claim, set-off, defence or
other right which that Borrower may have at any time against the Agent, the
Lenders, the Issuer or any other person.






	 	 	Reference Rate Revolving Loans to satisfy reimbursement obligations






	 	6.12.4	 	If the Issuer honours a draw under any Letter of Credit or makes a payment under a
Guarantee and the relevant Borrower shall not have repaid such amount to the Agent
pursuant to Clause 6.12.3 (Payment of Letter of Credit or Guarantee obligations), the
honouring of such draw or the making of such payment by the Issuer shall of itself
cause there to arise a Reference Rate Revolving Loan by the Lenders of the amount of
such draw or payment which Reference Rate Revolving Loan that Borrower shall be
obliged to repay immediately. In the event of non-payment of such Reference Rate
Revolving Loan, interest thereon shall be calculated by reference to successive
periods of such duration as the Agent may select at a rate per annum which is the sum
of (i) two per cent (2%) (ii) the Applicable Margin and (iii) the Reference Rate and
shall be paid by the relevant Borrower at the end of the period by reference to which
it is calculated or on such other date as the Agent may specify by written notice to
that Borrower. If not paid on the due date, the interest shall be added to and form
part of the Reference Rate Revolving Loan on which interest shall accrue and be
payable in accordance with the provisions of this Clause 6.12.4 (Reference Rate
Revolving Loans to satisfy reimbursement obligations).






	 	 	Letters of Credit and Guarantees — Assumption of Risk
	 
	6.13	 	
	 
	 	 	Authorisations






	 	6.13.1	 	Each of the Borrowers and the Lenders unconditionally and irrevocably:






	 	(a)	 	authorise and direct the Issuer to pay any request or
demand for payment under and in accordance with any Letter of Credit or
Guarantee issued by it without requiring proof of the relevant Borrower’s
agreement that any amount so demanded or paid is or was due and
notwithstanding that the relevant Borrower may dispute the validity of any
such request, demand or payment;
	 
	 	(b)	 	confirms that the Issuer deals in documents only and
shall not be concerned with the legality of any claim under any Letter of
Credit or Guarantee or any other underlying transaction or any set-off,
counterclaim or defence as between the relevant Borrower and any beneficiary
of any Letter of Credit or Guarantee; and
	 
	 	(c)	 	agrees that the Issuer need not have any regard to the
sufficiency, accuracy or genuineness of any such request or demand or any
certificate or statement in connection therewith or any incapacity of or
limitation upon the powers of any person signing or issuing any such
request, demand, certificate or statement which appears on its face to be in
order and agrees that the Issuer shall not be obliged to enquire as to any
such matters and may assume that any such request, demand, certificate or
statement which appears on its face to be in order is correct and properly
made.




38









 












	 	 	Rights of contribution and subrogation






	 	6.13.2	 	Until all amounts which are or may become payable by the Obligors under or in
connection with the Finance Documents have been irrevocably paid in full and the
Agent, the Issuer, the Swingline Lender and/or the Lenders are under no liability
hereunder, whether actual or contingent, no Borrower shall, by virtue of any payment
made by it under or in connection with or referable to this Clause 6 (Utilisation of
the Revolving Facility) or otherwise be subrogated to any rights, security or moneys
held or received by the Agent, the Lenders and/or the Security Trustee or be entitled
at any time to exercise, claim or have the benefit of any right of contribution or
subrogation or similar right against any of them and each Borrower irrevocably waives
all rights of contribution or similar rights against each of them.






	 	 	Waiver of defences






	 	6.13.3	 	Each Borrower’s obligations under this Clause 6 (Utilisation of the Revolving
Facility) shall not be affected by any act, omission, matter or thing which, but for
this provision, might reduce, release or prejudice any of its obligations hereunder
in whole or in part, including without limitation and whether or not known to it:






	 	(a)	 	any time or waiver granted to or composition with any
beneficiary or any other person;
	 
	 	(b)	 	any taking, variation, compromise, exchange, renewal or
release of, or refusal or neglect to perfect, take up or enforce, any
rights, remedies or securities available to the Issuer or other person or
arising under any Letter of Credit or Guarantee; or
	 
	 	(c)	 	any unenforceability, illegality or invalidity of any
Letter of Credit or Guarantee to the intent that each Borrower’s obligations
under this clause 6 shall remain in full force and be construed as if there
were no such effect.






	 	 	Supporting Letter of Credit; Cash Collateral
	 
	6.14	 	If, notwithstanding the provisions of this Clause 6 (Utilisation of the Revolving Facility)
and Clause 29 (Term and Termination) any Letter of Credit or Guarantee is outstanding upon the
termination of this Agreement, then upon such termination each Borrower shall deposit with the
Security Trustee, at its discretion, with respect to each Letter of Credit or Guarantee then
outstanding, in its favour and at its request either:






	 	6.14.1	 	a standby letter of credit (a “Supporting Letter of Credit”) in form and substance
satisfactory to the Agent and the Security Trustee, issued by an issuer satisfactory
to the Lenders in an amount equal to the greatest amount for which such Letter of
Credit may be drawn (or, as the case may be, the maximum contingent liability under
such Letter of Credit or Guarantee) together with all fees, expenses and charges in
respect thereof (together the “maximum liability”) under which Supporting Letter of
Credit the Security Trustee is entitled to draw amounts necessary to reimburse the
Issuer (through the Agent) for payments made by the Issuer under such Letter of
Credit or Guarantee; or
	 
	 	6.14.2	 	cash in an amount equal to such maximum liability.






	 	 	Such Supporting Letter of Credit or deposit of cash shall be held by the Security Trustee
as security for, and to provide for the payment of, the aggregate face amount of all
Letters of




39









 






	 	 	Credit or, as the case may be, the aggregate maximum contingent liability under all
Guarantees, remaining outstanding.
	 
	 	 	Agent Loans
	 
	6.15	 	
	 
	 	 	Authorisation






	 	6.15.1	 	Subject to the provisions of this Clause 6.15 (Agent Loans), the Agent is hereby
authorised by each Borrower and the Lenders, from time to time in the Agent’s
reasonable discretion, after the occurrence of a Default or an Event of Default which
is continuing unremedied or unwaived or at any time that any of the other conditions
to the making available of any Loans hereunder have not been satisfied (and provided
in any such case that it is impractical to contact the Lenders), to make Reference
Rate Revolving Loans (but in any event not to exceed the Available Facility) to a
Borrower on behalf of the Lenders which the Agent, in its reasonable business
judgement, deems necessary or desirable (i) to preserve or protect any Collateral,
(ii) to enhance the likelihood of, or maximise the amount of, repayment of any of the
Outstandings or (iii) to pay any other amount chargeable to that Borrower pursuant to
the terms of this Agreement, including without limitation any costs, fees and
expenses (any such Reference Rate Revolving Loan described in this Clause 6.15 (Agent
Loans) being an “Agent Loan”).






	 	 	Revocation of Authorisation






	 	6.15.2	 	The Lenders may at any time revoke the Agent’s authorisation contained in Clause
6.15.1 (Authorisation) to make Agent Loans, any such revocation to be in writing and
to become effective only upon the Agent’s actual receipt thereof.






	 	 	Repayment






	 	6.15.3	 	Agent Loans shall constitute Reference Rate Revolving Loans under this Agreement
repayable by the relevant Borrower on demand and shall bear interest at the rate per
annum applicable to Reference Rate Revolving Loans plus 2%. The Agent shall notify
each Lender in writing of each Agent Loan that it makes.






	 	 	Settlement






	 	6.15.4	 	It is agreed that each Lender shall participate in each such Reference Rate
Revolving Loan constituted by an Agent Loan in an amount equal to its Participating
Proportion of the amount of such Reference Rate Revolving Loan. Notwithstanding such
agreement, the Agent and the Lenders agree (which agreement shall not be for the
benefit of or enforceable by the Borrowers) that in order to facilitate the
administration of this Agreement settlement of Agent Loans shall take place on a
periodic basis on such date or dates as the Agent may specify by written notice to
the Lenders. On receipt of any such notice, each Lender shall make an amount equal
to its Participating Proportion of the outstanding principal amount of the Agent
Loans in respect of which settlement is requested available to the Agent in
immediately available funds to such account of the Agent as the Agent may designate,
not later than 2.00 p.m. on the proposed settlement date (which shall be not less
than three business days following the date of such notice). If any such amount is
not made available to the Agent by any Lender on such settlement date, such Lender
shall pay such amount to the Agent on demand together with interest thereon from such
settlement date to the date of actual payment calculated at a rate per annum which is






40











 






the sum of (i) two per cent (2%) (ii) the Applicable Margin and (iii) the
Reference Rate.




Participation and Notification



6.16





Participation by Lenders




	 	6.16.1	 	Each Lender will participate through its Facility Office in each Utilisation
hereunder, comprising the making of the Revolving Loans, or in any amount to be
reimbursed to the Swingline Lender or the Issuer following any non-payment by any
Borrower of any amount due from it in respect of a Swingline Loan or, as appropriate,
a Letter of Credit or Guarantee, in the proportion which its Commitment bears to the
Total Commitments immediately prior to the making available of that Utilisation or,
as the case may be, at the time of any such non-payment.






Notification to Lenders




	 	6.16.2	 	The Agent shall, promptly after receipt by it of a Utilisation Notice, notify each
Lender of the details of such notice and of the amount of that Lender’s share of the
Utilisation to be made available to the relevant Borrower.






Aggregate Exposure




	6.17	 	The Aggregate Exposure shall at no time exceed the Maximum Revolving Credit Line and if at
any time this limit is exceeded as a consequence of currency fluctuations, the Borrowers shall
provide cash cover in an amount equal to such excess.
	 
	7.	 	INTEREST AND INTEREST PERIODS






Dates of Payment of Interest




	7.1	 	Each Revolving Loan shall bear interest on its unpaid principal amount from the date made
until paid in cash at a rate determined by reference to the Reference Rate or to LIBOR, as
applicable, and the relevant Borrower shall pay accrued interest on each such Revolving Loan
(i) in the case of each Reference Rate Revolving Loan, on the first day of each month
thereafter and (ii) in the case of each LIBOR Revolving Loan, on the last day of each Interest
Period relating to such LIBOR Revolving Loan.
	 
	 	 	If the audited consolidated Financial Statements for the Group and related certificate of
BMUK for a Financial Year delivered in accordance with Clauses 15.2.1 (Financial
Statements) and 15.3.3 (Certificate of BMUK) show that a higher Applicable Margin should
have applied during a certain period, then BMEH shall (or shall ensure that 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 Applicable
Margin applied during such period.
	 
	 	 	Rate of Interest





7.2





	 	7.2.1	 	The rate of interest applicable to a LIBOR Revolving Loan from time to
time during an Interest Period relating to it shall be the rate per annum which is
the sum of (i) the Applicable Margin at such time, (ii) LIBOR relating to such LIBOR
Revolving Loan




41









 






	 	 	 	for such Interest Period and (iii) the Mandatory Cost, if any, applicable to that
LIBOR Revolving Loan.
	 
	 	7.2.2	 	The rate of interest applicable to a Swingline Loan and each Reference
Rate Revolving Loan shall be a fluctuating rate per annum which is the sum of the
Reference Rate and the Applicable Margin. Each change in the Reference Rate and the
Applicable Margin shall be reflected in such interest rate as of the effective date
of such change.






Interest Periods — LIBOR Revolving Loans




	7.3	 	Save as otherwise provided in this Agreement, the duration of each Interest Period relating
to a LIBOR Revolving Loan shall be the period selected by the relevant Borrower in the
Utilisation Notice relating to that LIBOR Revolving Loan.
	 
	 	 	Maximum Number of Interest Periods
	 
	7.4	 	A Borrower may not select an Interest Period in respect of any LIBOR Revolving Loan of such a
duration that there shall at any time be more than five Interest Periods in existence at the
same time.
	 
	 	 	Conversion and Continuation of Revolving Loans





7.5





	 	7.5.1	 	BMUK (on behalf of the Borrowers) may, upon irrevocable written notice to
the Agent in accordance with Clause 7.5.2:






	 	(a)	 	at any time after the Outstandings in respect of
Reference Revolving Rate Loans are equal to or exceed an amount equal to an
Original Sterling Amount of £20,000,000 elect, as of any business day, in
the case of Reference Rate Revolving Loans, to convert any such Reference
Rate Revolving Loans (or any part thereof) in an amount or integral multiple
of not less than £1,000,000 into LIBOR Revolving Loans;
	 
	 	(b)	 	elect, as of the last day of the applicable Interest
Period, to continue any LIBOR Revolving Loans having Interest Periods
expiring on such day (or any part thereof) in an amount or integral multiple
of not less than £1,000,000.






	 	7.5.2	 	If any Revolving Loans are to be converted into or continued as LIBOR
Revolving Loans, BMUK shall deliver a notice of conversion or continuation (a “Notice
of Conversion/Continuation”) to be received by the Agent not later than 11.00 a.m. at
least one business day (in the case of any Revolving Loan denominated in sterling)
and at least three business days (in the case of any Revolving Loan denominated in a
Foreign Currency), in advance of the proposed date of conversion or continuation
specifying:






	 	(a)	 	the proposed date of such conversion or continuation;
	 
	 	(b)	 	the aggregate amount of Revolving Loans to be converted
or continued; and
	 
	 	(c)	 	the type of Revolving Loans resulting from the proposed
conversion or continuation.




42









 












	 	7.5.3	 	If upon drawdown of any Revolving Loan or upon the expiry of any Interest
Period applicable to any LIBOR Revolving Loan, BMUK has failed to select a new
Interest Period to be applicable thereto or if any Default or Event of Default then
exists, BMUK shall be deemed to have elected to convert such LIBOR Revolving Loan
into a Reference Rate Revolving Loan as of the expiry date of such Interest Period.
	 
	 	7.5.4	 	During the existence of a Default or an Event of Default, BMUK may not
elect to have a Revolving Loan converted into or continued as a LIBOR Revolving Loan.
	 
	 	 	 	Margin Ratchet





7.6





	 	7.6.1	 	On the first business day of each Management Accounting Period, the Agent
shall calculate the average daily Available Revolving Facility Amount during the
previous Management Accounting Period. Subject to the provisions of this Clause 7.6
(Margin Ratchet), if the average daily Available Revolving Facility Amount during
such previous Management Accounting Period was within a range set out below then the
Applicable Margin for the next succeeding Management Accounting Period will (subject
to any adjustment pursuant to Clause 7.6.3 below) be the percentage per annum set out
below in the column opposite that range:





	 	 	 	 	 
	 	 	Applicable Margin	 
	Average daily Available Revolving Facility Amount	 	(%) per annum	 
	Less than £10,000,000
	 	 	2.50	 
	Equal to or greater than £10,000,000 but less than
£15,000,000
	 	 	2.25	 
	Equal to or greater than £15,000,000 but less than
£20,000,000
	 	 	2.00	 
	Equal to or greater than £20,000,000
	 	 	1.75	 







	 	7.6.2	 	Any increase or decrease (as applicable) in the Applicable Margin as a
result of the operation of Clause 7.6.1 shall take effect on the first business day
of the Management Accounting Period following the Management Accounting Period in
respect of which the Agent shall have made the calculation referred to in Clause
7.6.1.
	 
	 	7.6.3	 	At the same time as it prepares the next set of Management Accounts that
are required to be delivered to the Agent in accordance with Clause 15.2.2
(Management Accounts) following the end of a Financial Quarter ending on or after
(but not before) 31 December 2005 (each such Financial Quarter being for the purposes
of this Clause 7.6 (Margin Ratchet) the “Previous Financial Quarter”), BMUK shall
calculate the actual EBITDA achieved from the start of the Financial Year in which
the Previous Financial Quarter fell to the end of the Previous Financial Quarter (the
“Actual YTD EBITDA”) and shall compare it against the projected EBITDA for that
period (as set out in the projections delivered to the Agent prior to the Effective
Date or, in any Financial Year commencing after the Effective Date, the Latest
Projections delivered to the Agent in accordance with Clause 15.2.3 (Latest
Projections) for that Financial Year) (the “Projected YTD EBITDA”). BMUK shall, at
the same time as it delivers those Management Accounts to the Agent, deliver a
certificate to the Agent (signed by its finance director) (an “Actual YTD EBITDA
Certificate”) certifying the Actual YTD EBITDA achieved to the end of the Previous
Financial Quarter and calculating (as a percentage) the amount (if any) by which the
Projected YTD EBITDA to the end of the Previous Financial Quarter exceeds the Actual
YTD EBITDA achieved to the end of the Previous Financial Quarter (the “Variance”).
Subject to the provisions of




43









 






	 	 	 	this Clause 7.6 (Margin Ratchet) , if the Actual YTD EBITDA Certificate delivered
to the Agent demonstrates that the Variance is within a range set out below then
the Applicable Margin (as determined from time to time in accordance with Clause
7.6.1) will be increased by the amount set out below in the column opposite that
range:





	 	 	 	 	 
	 	 	Amount by which the Applicable	 
	 	 	Margin determined in accordance with	 
	Variance
	 	Clause 7.6.1 is increased (%)	 
	Less than 30%
	 	Nil  
	Equal to or greater than 30% but less
than 50%
	 	 	0.25	 
	Equal to or greater than 50%
	 	 	0.50	 







For the avoidance of doubt, if an Actual YTD EBITDA Certificate delivered to the
Agent demonstrates that the Actual YTD EBITDA achieved to the end of the Previous
Financial Quarter exceeds the Projected YTD EBITDA to the end of the Previous
Financial Quarter then the Applicable Margin (determined in accordance with
Clause 7.6.1) will be increased by zero per cent..




If BMUK does not deliver an Actual YTD EBITDA Certificate in accordance with
Clause 7.6.3 then the Applicable Margin (determined in accordance with Clause
7.6.1) will be increased by 0.50 per cent. per annum.




	 	7.6.4	 	Any increase in the Applicable Margin (determined in accordance with
Clause 7.6.1) as a result of the operation of Clause 7.6.3 shall take effect on the
first business day of the Management Accounting Period in which the Actual YTD EBITDA
Certificate is delivered or should have been delivered.
	 
	 	7.6.5	 	For the avoidance of doubt, the Applicable Margin shall never be less than
1.75 per cent. per annum.
	 
	 	7.6.6	 	If, following receipt by the Agent of the audited consolidated Financial
Statements for the Group and related certificate of BMUK in accordance with Clauses
15.2.1 (Financial Statements) and 15.3.3 (Certificate of BMUK), those Financial
Statements and related certificate of BMUK show that the Variance stated in any
Actual YTD EBITDA Certificate delivered in respect of any Financial Quarter falling
in the Financial Year to which those Financial Statements relate was greater than the
Variance stated in any Actual YTD EBITDA Certificate delivered in respect of any
Financial Quarter falling in the Financial Year to which those Financial Statements
relate, then the provisions of Clause 7.1 (Dates of Payment of Interest) shall apply
and the Applicable Margin shall be determined using the table set out in Clause 7.6.3
above and each Variance in respect of a period shall be calculated using audited
consolidated Financial Statements for the Group and related certificate of BMUK
delivered for that Financial Year.
	 
	 	7.6.7	 	At any time while a Default has occurred and is continuing, the Applicable
Margin shall be 2.50 per cent. per annum, notwithstanding any previous reduction of
the Applicable Margin made pursuant to this Clause 7.6 (Margin Ratchet) and no
reduction shall be instituted while a Default has occurred and is continuing. For the
avoidance of doubt, nothing in this Clause 7.6.7 shall limit any default interest or
other charges that may be payable under this Agreement and if any default interest or
other




44









 






	 	 	 	charges are payable under this Agreement then they shall be paid in addition to
the Applicable Margin calculated under this Clause 7.6 (Margin Ratchet).






	8.	 	MARKET DISRUPTION
	 
	 	 	Circumstances
	 
	8.1	 	If at or about 11.00 a.m. on the Quotation Date for an Interest Period in respect of any
LIBOR Revolving Loan the Agent (in consultation with the Lenders) determines it is not
possible by reason of circumstances affecting the London Interbank Market generally (i) to
determine LIBOR in accordance with its definition, or (ii) for the Lenders to obtain requisite
matching deposits in the required currency in the London Interbank Market at the relevant time
to fund their respective shares during such Interest Period, or (iii) for the Majority Lenders
to obtain such deposits for such period at a cost less than or equal to the rate offered to
the Agent in accordance with the definition of LIBOR, then the Agent shall forthwith notify
BMUK and the Lenders and notwithstanding the provisions of Clause 7 (Interest and Interest
Periods), the Interest Period in respect of that LIBOR Revolving Loan and the amount of
interest payable in respect of that LIBOR Revolving Loan during its Interest Period shall be
determined in accordance with the following provisions of this Clause 8 (Market Disruption).
	 
	 	 	Applicable Interest Rate
	 
	8.2	 	If Clause 8.1 (Circumstances) applies in relation to a LIBOR Revolving Loan the duration of
the Interest Period relating to that Loan shall be one month or, if less, such that it shall
end on the Termination Date and the rate of interest applicable to that LIBOR Revolving Loan
during its Interest Period shall be the rate per annum which is the sum of (i) the Applicable
Margin, (ii) the Mandatory Cost, if any, and (iii) the rate determined by the Agent (and
notified to BMUK) to be that which expresses as a percentage rate per annum the weighted
average of the cost to each of the Lenders of funding its share of such LIBOR Revolving Loan
during such Interest Period from whatever sources and in whatever manner each such Lender may
reasonably select.
	 
	 	 	Review of Circumstances
	 
	8.3	 	So long as any alternative basis for the calculation of interest as provided in Clause 8.2
(Applicable Interest Rate) is in force the Agent shall from time to time review whether or not
the circumstances referred to in Clause 8.1 (Circumstances) still prevail with a view to
returning to the normal provisions of this Agreement relating to the determination of the
rates of interest applicable to any LIBOR Revolving Loan.
	 
	 	 	Distribution of Interest
	 
	8.4	 	Interest on a LIBOR Revolving Loan during an Interest Period relating to it calculated at the
rates specified in Clause 8.1 (Circumstances) or 8.2 (Applicable Interest Rate) shall be
distributed by the Agent to the Lenders in proportion to the amounts which represent the cost
to each Lender of funding its share of such LIBOR Revolving Loan during such Interest Period
provided that any such interest which is attributable to the Applicable Margin shall be
distributed by the Agent to the Lenders in proportion to their respective shares in such LIBOR
Revolving Loan.
	 
	9.	 	REPAYMENT, PREPAYMENT AND CANCELLATION
	 
	 	 	Repayment of Revolving Loans
	 
	9.1	 	Each Borrower shall repay each LIBOR Revolving Loan made to it, together with accrued but
unpaid interest thereon, on the last day of the Interest Period applicable to that Loan. Each





45









 





	 	 	Borrower may repay each Reference Rate Revolving Loan and each Swingline Loan made to it,
together with accrued but unpaid interest thereon, at any time. Each Borrower shall, in
any event, repay the outstanding principal balance of all Revolving Loans made to it, plus
all accrued but unpaid interest thereon, upon the termination of this Agreement for any
reason. In addition, and without limiting the generality of each foregoing, each Borrower
shall pay to the Agent, on demand, the amount by which the Original Sterling Amount of the
unpaid principal balance of any Revolving Loans and any Swingline Loans when aggregated
with the Original Sterling Amount of the maximum face amount of all Letters of Credit and
the maximum contingent liability under all Guarantees then in issue (together “contingency
outstandings”) at any time exceeds the Available Facility in respect of the Revolving
Facility or the Available Revolving Facility Amount, the Available Facility and Available
Revolving Facility Amount being determined for this purpose as if the amount of the
Revolving Loans, Swingline Loans and contingency outstandings were zero. Subject to the
other terms of this Agreement and to availability, Revolving Loans and Swingline Loans may
be reborrowed.
	 
	 	 	Cancellation of Total Commitments
	 
	9.2	 	Any Borrower may, by giving to the Agent not less than 30 business days’ prior notice to that
effect, permanently cancel the whole (but subject to Clause 29 (Term and Termination)) or any
part (being a minimum amount of £5,000,000 and an integral multiple of £1,000,000) of the
Total Commitments, provided that both on the date of such notice and upon the effective date
of cancellation, the amount to be so cancelled does not exceed an amount equal to the
difference between the Maximum Revolving Credit Line and the Aggregate Exposure and the Agent
has not, pursuant to Clause 6.7 (Special Provisions relating to Revolving Loans), permitted
the limits of the Available Revolving Facility Amount to have been exceeded. Any such
cancellation shall reduce the Commitment of each Lender pro rata. If a Borrower cancels any
part (but not the whole) of the Total Commitments, BMUK shall (or shall procure that such
other Borrower shall) pay to the Agent (for the rateable benefit of the Lenders), on or prior
to the date of such cancellation:






	 	9.2.1	 	0.75% of the amount of the Total Commitments so cancelled, if such
cancellation is made on or prior to the first Anniversary Date;
	 
	 	9.2.2	 	0.5% of the amount of the Total Commitments so cancelled, if such
cancellation is made at any time after the first Anniversary Date but on or prior to
the second Anniversary Date; and
	 
	 	9.2.3	 	0.25% of the amount of the Total Commitments so cancelled, if such
cancellation is made at any time after the second Anniversary Date but on or prior to
the date falling two months before the third Anniversary Date.






Prepayment and cancellation of Individual Lenders




	9.3	 	If a Borrower becomes obliged to pay an increased amount pursuant to Clauses 10.1
(Requirement to Gross-up) or 11.1 (Increased Costs and Reduction of Return) or any Lender
claims indemnification from BMUK under Clause 10.2 (Indemnity) or Clause 11.1 (Increased Costs
and Reduction of Return) and the Agent receives from BMUK at least fifteen days’ prior notice
of the intention of the Borrowers to prepay such Lender’s Outstandings, such Lender shall,
upon receipt by the Agent of such notice, cease to be obliged to participate in any further
Loans, its Commitment shall be permanently cancelled and reduced to zero and each Borrower
shall on the last day of each of the then current Interest Periods or earlier, if the Agent or
such Lender so requires, prepay such Lender’s portion of the Loan to which such Interest
Period relates together with any applicable break costs payable under Clause 19.2 (Break
Costs) but otherwise without premium or penalty.




46









 






	 	 	Notices Irrevocable
	 
	9.4	 	Any notice of cancellation or prepayment given by a Borrower (or BMUK on its behalf) pursuant
to Clause 9.2 (Cancellation of Total Commitments) or Clause 9.3 (Prepayment and Cancellation
of Individual Lenders) shall be irrevocable, shall specify the date upon which such prepayment
is to be made and the amount of such prepayment and shall oblige that Borrower to make such
prepayment on such date. A Borrower shall not be entitled to reborrow any amount so prepaid.
	 
	 	 	Extension of Termination Date





9.5





	 	9.5.1	 	On 20 October 2010 BMUK may deliver a request to the Agent (which the
Agent shall promptly forward to the Lenders), requesting that the Lenders shall
extend the maturity of the Revolving Facility to 20 October 2012.
	 
	 	9.5.2	 	The decision whether or not to extend the Termination Date shall be in the
absolute discretion of the Agent to determine (acting on the instructions of all of
the Lenders) and shall be based upon such factors as the Agent may deem relevant
(including, without limitation, the business condition (financial or otherwise) of
the Group at the relevant time and after reviewing such forecasts, projections and
financial and other information regarding the Borrowers and the Group as the Agent
may require. The Borrowers acknowledge that the Agent and the Lenders shall not be
under any obligation to extend the Termination Date.
	 
	 	9.5.3	 	If extended pursuant to this Clause 9.5 (Extension of Termination Date),
references to the “Termination Date” in this Agreement and the other Finance
Documents shall be construed as a reference to the Termination Date as from time to
time extended. Any extension of term and restatement of this Agreement does not
constitute a novation.






	10.	 	TAXES
	 
	 	 	Requirement to Gross-up
	 
	10.1	 	All payments to be made by any of the Obligors to any person under this Agreement shall be
made free and clear of and without deduction for or on account of tax unless such Obligor is
required by law to make such a payment subject to the deduction or withholding of tax, in
which case the sum payable by such Obligor in respect of which such deduction or withholding
is required to be made shall be increased to the extent necessary to ensure that, after the
making of such deduction or withholding (including any deduction or withholding applicable to
additional sums payable under this clause), such person receives and retains (free from any
liability in respect of any such deduction or withholding) a net sum equal to the sum which it
would have received and so retained had no such deduction or withholding been made or been
required to be made.
	 
	 	 	Indemnity
	 
	10.2	 	Without prejudice to the provisions of Clause 10.1 (Requirement to Gross-up), if any person
or the Agent is required to make any payment on account of tax (other than tax on its overall
net income) on or calculated by reference to the amount of any Loan made or to be made under
this Agreement or by reference to any Letter of Credit or Guarantee issued under this
Agreement and/or by reference to any sum received or receivable under this Agreement by such
person or the Agent on its behalf (including, without limitation, any sum received or
receivable under this Clause 10 (Taxes)) or any liability in respect of any such payment is
asserted, imposed, levied




47









 






	 	 	or assessed against such person or the Agent on its behalf, the relevant Obligor shall,
upon demand of the Agent, promptly indemnify such person against such payment or
liability, together with any interest, penalties and expenses payable or incurred in
connection therewith provided that the foregoing shall not apply to the extent that the
payment or liability (a) is compensated for by an increased payment under Clause 10.1
(Requirement to Gross-up)or (b) would have been so compensated but was not so compensated,
solely because one of the exclusions in Clause 10.6 (Limitation on Requirement to
Gross-up) applied.
	 
	 	 	Notification
	 
	10.3	 	A Lender intending to make a claim pursuant to Clause 10.2 (Indemnity) shall notify the Agent
of the event by reason of which it is entitled to do so whereupon the Agent shall notify the
relevant Obligor.
	 
	 	 	Tax Receipts
	 
	10.4	 	Without prejudice to the provisions of Clause 10.1 (Requirement to gross-up), if any Obligor
makes any payment under this Agreement in respect of which it is required by law to make any
deduction or withholding it shall pay the full amount to be deducted or withheld to the
relevant taxation or other authority within the time allowed for such payment under applicable
law and shall deliver to the Agent (no later than one week after the end of the time allowed
for such payment under applicable law) an original receipt or other appropriate evidence
issued by such authority evidencing the payment to such authority of all amounts so required
to be deducted or withheld from such payment.
	 
	 	 	Tax Credits
	 
	10.5	 	If any Obligor makes an increased payment under Clause 10.1 (Requirement to Gross-up) for the
account of any person and such person in its sole opinion and based on its own interpretation
of any relevant laws or regulations (but acting in good faith) determines that it has received
or been granted a credit against or relief or remission for or in respect of any tax paid or
payable by it in respect of or calculated by reference to the deduction or withholding giving
rise to such payment, such person shall, to the extent that it determines that it can do so
without prejudice to the retention of the amount of such credit, relief, remission or payment
and, to the extent it is reasonably identifiable and quantifiable, as soon as practicable pay
to such Obligor an amount equal to such part or all of such credit, relief, remission or
repayment as can be made available to such Obligor in such a way as to leave such person
(after such payment) in no better or worse position than it would have been in if such Obligor
had not been required to make such deduction or withholding. Nothing contained in this Clause
10.5 (Tax Credits) shall interfere with the right of a person to arrange its tax affairs in
whatever manner it thinks fit nor oblige any person to disclose any information relation to
its tax affairs or any computation in respect thereof.
	 
	 	 	Limitation on Requirement to Gross-up





10.6





	 	10.6.1	 	If any Lender ceases to be a Qualifying Lender, no Obligor shall be liable to pay
to such Lender under Clause 10.1 (Requirement to Gross-up) any amount in excess of
the amount it would have been obliged to pay if such Lender had not ceased to be a
Qualifying Lender provided that this Clause 10.6 (Limitation on Requirement to
Gross-up) shall not apply and each Obligor shall continue to be obliged to comply
with its obligations under Clause 10 (Requirement to Gross-up) if and to the extent
that after the date of this Agreement there shall have been any change in, or in the
interpretation, administration or application of, any relevant law or double taxation




48









 






	 	 	 	treaty or any published practice or concession of any relevant taxing authority
and as a result of such change (i) such Lender ceases to be a Qualifying Lender
or (ii) such Obligor would be required to make a deduction or withholding on
account of tax irrespective of whether the recipient of the relevant payment was
or was not a Qualifying Lender.
	 
	 	10.6.2	 	No Obligor shall be liable to make a payment to a Lender under Clause 10.1
(Requirement to Gross-up) if on the date on which the payment falls due the relevant
Obligor is able to show that the payment could have been made to such Lender without
any deduction or withholding had such Lender complied with its obligations under
Clause 10.7 (Double Taxation Relief).
	 
	 	Double Taxation Relief






	10.7	 	If, and to the extent that, the effect of Clause 10.1 (Requirement to Gross-up) or 10.2
(Indemnity) can be mitigated by virtue of the provisions of any applicable double tax treaty
entered into by the United Kingdom (whether by a claim to repayment of any taxes referred to
in Clause 10.1 (Requirement to gross-up) or 10.2 (Indemnity) or otherwise) each Lender agrees
to co-operate (to the extent reasonably required) with affected Obligor(s) with a view to
submitting any forms required for the purpose of ensuring the application of such double tax
treaty so far as relevant, provided that no Lender shall be required pursuant to this Clause
10.7 (Double Taxation Relief) to complete or co-operate in completing any form which is not
substantially similar to any form in use at the date of this Agreement for the purpose of
claiming exemption or relief from or repayment of taxes envisaged hereunder pursuant to a
double taxation treaty between the United Kingdom and such Lender’s jurisdiction of residence
and which requires the Lender to undertake obligations which, in its reasonable opinion, are
more onerous than those imposed upon it as at the date of this Agreement.
	 
	11.	 	INCREASED COSTS
	 
	 	 	Increased Costs and Reduction of Return
	 
	11.1	 	If the Agent or, as the case may be, any Lender, in its sole discretion determines that, as a
result of (i) the introduction of, or any change in any law or in any treaty, directive or
regulation (whether or not having the force of law but if not having the force of law, only if
such treaty, directive or regulation is generally applicable to banks and of the type with
which the relevant Lender is accustomed to comply) or the interpretation or application
thereof, in each case after the date hereof, or (ii) compliance with any request from or
requirement (whether or not having the force of law but if not having the force of law, only
if such request or requirement is generally applicable to banks and of the type with which the
relevant Lender is accustomed to comply) of any central bank or other fiscal, monetary or
other authority made or imposed after the date hereof:






	 	11.1.1	 	it incurs a cost in assuming or maintaining all or any part of any Commitment under
this Agreement and/or in making, maintaining or funding all or any part of its
Outstandings or any unpaid sum and/or assuming or maintaining a contingent liability
under or pursuant to this Agreement (whether under any Letter of Credit or Guarantee
or otherwise), or that cost is increased; or
	 
	 	11.1.2	 	any sum received or receivable by it under this Agreement or the effective return
to it under this Agreement is reduced; or
	 
	 	11.1.3	 	it suffers a reduction in the rate of return on its overall capital below that
which might reasonably have been anticipated at the date of this Agreement and which
it would have been able to achieve but for having entered into and/or performing its
obligations




49









 






	 	 	 	and/or assuming or maintaining a commitment or contingent liability under or
pursuant to this Agreement; or
	 
	 	11.1.4	 	it makes any payment or forgoes any interest or other return on or calculated by
reference to the amount of any sum received or receivable by it under or pursuant to
this Agreement; or
	 
	 	11.1.5	 	it incurs a cost or increased cost, or suffers a reduction in any amount payable to
it or in the effective return on its capital, or forgoes any interest or any other
return as a result of the introduction of, changeover to or operation of the euro in
the United Kingdom,






and in any such case, the same is attributable to its liabilities or obligations under
this Agreement, then the person concerned shall notify the Agent of the relevant event
(setting out in reasonable detail the basis on which its claim has been computed) promptly
upon its becoming aware of the same, whereupon the Agent shall notify BMUK and, upon
demand of the Agent, BMUK shall pay, or shall procure that there is paid, on demand to the
Agent for the account of the person concerned an amount sufficient to indemnify that
person against the relevant cost, increased cost, reduction, reduction in the rate of
return, payment or forgone interest or other return or such proportion thereof as is, in
the opinion of such person, attributable to its obligations under or pursuant to this
Agreement.




Capital Adequacy




	11.2	 	If the Agent, or as the case may be, any Lender, in its sole discretion determines that (i)
the introduction of, or any change in, any capital adequacy regulation or in the
interpretation or application thereof, in each case after the date hereof, or (ii) compliance
by such person or any corporation controlling it with any capital adequacy regulation, affects
or would affect the amount of capital, reserves or special deposits required or expected to be
maintained by such person or any corporation controlling it and (taking into consideration
such person’s or such corporation’s policies with respect to capital adequacy) determines that
the amount of such capital, reserves or special deposits is increased as a consequence of its
loans, contingent liabilities or obligations under this Agreement then, upon demand of the
Agent (having been so notified by such person) to BMUK, BMUK shall pay, or shall procure that
there is paid, to the Agent for the account of the person concerned, from time to time as
specified by the Agent, additional amounts sufficient to compensate such person for such
increase.
	 
	 	 	Exceptions
	 
	11.3	 	Clauses 11.1 (Increased Costs and Reduction of Return) and 11.2 (Capital Adequacy) do not
apply to any cost, increased cost, reduction, reduction in the rate of return, payment or
forgone interest or other return compensated for by (a) payment of the Mandatory Cost, (b) by
the operation of Clause 10 (Taxes), (c) by a change in the rate of tax on the overall net
income of the Agent or any Lender or (d) which is attributable to the wilful breach by the
relevant Lender or any of its Affiliates of any law or regulation.
	 
	12.	 	ILLEGALITY
	 
	 	 	Consequences of Illegality
	 
	12.1	 	If at any time it is unlawful, or contrary to any directive or request of any applicable
central bank or other fiscal, monetary or other authority, or impossible for a Lender to make,
fund or allow to remain outstanding any Loan made or to be made under this Agreement or to
assume or remain under any obligations hereunder in relation to or under any Letter of Credit
or




50









 






	 	 	Guarantee, then the Agent shall, promptly after becoming aware of the same, deliver to
BMUK a certificate to that effect and:






	 	12.1.1	 	such Lender shall not thereafter be obliged to make or participate in any Loan
under this Agreement or (in the case of the Issuer) issue any Letter of Credit or
Guarantee and its Commitment shall immediately be cancelled and reduced to zero; and
	 
	 	12.1.2	 	if the Agent on behalf of such Lender so requires, each Borrower shall on the last
day of the Interest Period for each such Loan occurring after the Agent has notified
BMUK or (if earlier) on such date as the Agent shall have specified (being no earlier
than the last day upon which the Lender is legally able to permit such Loans to
remain outstanding) repay such Lender’s Outstandings together with accrued interest
thereon (any such repayment to be without premium or penalty or the payment of any
amount to be calculated in accordance with Clause 29.2.3 ) and all other amounts
owing to such Lender under this Agreement, and, with respect to any Letter of Credit
or Guarantee then outstanding, deposit with the Security Trustee for the benefit of
the Issuer a Supporting Letter of Credit or cash, in either such case in the same
manner as contemplated in Clause 6.14 (Supporting Letters of Credit; Cash
Collateral).






Mitigation of Adverse Circumstances




	12.2	 	If, in respect of any Lender, circumstances arise which would, or would upon the giving of
notice, result in additional amounts becoming payable under Clause 10 (Taxes) or Clause 11.1
(Increased Costs and Reduction of Return) or result in a cancellation of its Commitment
pursuant to Clause 12.1.1 (Consequences of Illegality) then, without in any way limiting,
reducing or otherwise qualifying the obligations of any Borrower hereunder such Lender will,
at the request of BMUK, consider means of mitigating the effects of such circumstances
provided that such Lender shall be under no obligation to take any such action if to do so
would or might in its opinion have an adverse effect on its business, operations or financial
condition.
	 
	13.	 	GUARANTEE
	 
	 	 	Guarantee
	 
	13.1	 	Each Unsecured Guarantor, jointly and severally, unconditionally and irrevocably guarantees
to the Beneficiaries the due and punctual payment, performance and discharge by the Obligors
of all the moneys, obligations and liabilities (whether present or future, actual or
contingent) on the part of the Obligors to be paid, performed or discharged, whether directly
or indirectly, under or pursuant to the terms of this Agreement and/or in connection with the
Facility and/or otherwise under the Finance Documents (together in this Clause 13 (Guarantee)
the “guaranteed obligations”). If and whenever any Obligor shall default in the payment,
discharge or performance of any of the guaranteed obligations, each Unsecured Guarantor shall,
upon written demand by the Agent, promptly pay, perform or discharge the guaranteed
obligations in respect of which such default has been made.
	 
	 	 	Indemnity
	 
	13.2	 	Each Unsecured Guarantor agrees to indemnify and hold harmless the Beneficiaries from time to
time on demand for and against any loss incurred by any of them as a result of any of the
guaranteed obligations being or becoming void, voidable or unenforceable for any reason
whatsoever, whether known to such person or persons or not. The amount of such loss shall be
the amount which the person or persons suffering it would otherwise have been entitled to
recover from the Obligors.




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	 	 	Continuing Security
	 
	13.3	 	The obligations of each Unsecured Guarantor under this Agreement are continuing obligations
and shall remain in force until all of the guaranteed obligations have been satisfied in full.
The obligations of each Unsecured Guarantor under this Agreement shall not be (or be
construed so as to be) discharged by any intermediate discharge or payment of or on account of
any of the guaranteed obligations or any settlement of account or any other matter (other than
the discharge in full of the guaranteed obligations).
	 
	 	 	Protective Provisions
	 
	13.4	 	Neither the obligations of each Unsecured Guarantor nor the rights and remedies of the
Beneficiaries under this Agreement, any other Finance Document or otherwise conferred by law
shall be discharged, prejudiced or impaired by reason of:






	 	13.4.1	 	any variation of any of the guaranteed obligations or of the terms of conditions of
this Agreement, any other Finance Document or of any encumbrance, guarantee or other
assurance held or to be held as security for the payment, performance or discharge of
the guaranteed obligations (any such encumbrance, guarantee or other assurance
together referred to in this Clause 13 (Guarantee) as “related security”);
	 
	 	13.4.2	 	any failure (whether intentional or not) to take, perfect or realise (whether in
full or in part) any related security now or in the future agreed to be taken in
respect of any of the guaranteed obligations;
	 
	 	13.4.3	 	any incapacity or change in the constitution of any party to this Agreement, any
other Finance Document or to any related security;
	 
	 	13.4.4	 	any of the guaranteed obligations or any obligation of any person under any related
security being or becoming invalid, illegal, void or unenforceable for any reason;
	 
	 	13.4.5	 	any time or other indulgence given or agreed to be given to, or any composition or
other arrangement made with or accepted from, any Obligor in respect of any of the
guaranteed obligations or any other person in respect of any of its obligations under
any related security;
	 
	 	13.4.6	 	any waiver or release of any of the guaranteed obligations or of any obligation of
any person under any related security or any failure to realise, in full or in part,
the value of, or any discharge or exchange of any related security;
	 
	 	13.4.7	 	any Obligor or any other person party to this Agreement, any other Finance Document
or any related security being wound up, going into administration or liquidation or
making any composition or arrangement with its creditors (whether or not sanctioned
by the court and whether or not the Agent has agreed to such compromise or
arrangement) and so that where, by virtue of any compromise or arrangement, any of
the guaranteed obligations are transferred to any other person, the guarantee and
indemnity of each Unsecured Guarantor contained in this Agreement shall take effect
as if the expression “Obligor” included such other person; or
	 
	 	13.4.8	 	any other act, event or omission which, but for this provision, would or might
operate to offer any legal or equitable defence for or impair or discharge any of the
guaranteed obligations or any obligation of any person under any related security or
prejudicially affect the rights or remedies of the Beneficiaries or any of them under
this Agreement, any other Finance Document or otherwise conferred by law.




52









 












Independent Obligations




	13.5	 	The obligations of each Unsecured Guarantor under this Agreement are additional to, and not
in substitution for, any related security and the obligations assumed by each Unsecured
Guarantor under this Agreement may be enforced without first having recourse to any related
security and without making or filing any claim or proof in a winding-up or dissolution of any
Obligor or any other person party to this Agreement or any related security or first taking
any steps or proceedings against any Obligor or any such person.
	 
	 	 	Non-Competition
	 
	13.6	 	Until all of the guaranteed obligations have been satisfied in full, no Unsecured Guarantor
shall:






	 	13.6.1	 	exercise any right of subrogation, indemnity, set-off or counterclaim against any
Obligor, any other Unsecured Guarantor or any person party to any related security;
	 
	 	13.6.2	 	claim payment of any other moneys for the time being due to it by any Obligor, any
other Unsecured Guarantor or any person party to any related security by reason of
the performance by it of its obligations under this Agreement or on any account
whatsoever or exercise any other right or remedy or enforce any encumbrance,
guarantee or other assurance which it has in respect thereof;
	 
	 	13.6.3	 	claim any contribution from any other Unsecured Guarantor or any person party to
any related security;
	 
	 	13.6.4	 	negotiate, assign, charge or otherwise dispose of any moneys, obligations or
liabilities now or at any future time due or owing to it by any Obligor or any other
Unsecured Guarantor or any person party to any related security or any encumbrance,
guarantee or other assurance in respect thereof; or
	 
	 	13.6.5	 	claim or prove in a winding up or dissolution of any Obligor or any other Unsecured
Guarantor in competition with the Beneficiaries or any of them; and
	 
	 	13.6.6	 	if any Unsecured Guarantor receives any sums in contravention of this Clause 13.6
(Non-Competition), it shall hold them on trust to be applied promptly in or towards
the satisfaction of its obligations under this Agreement.






Warranty




	13.7	 	Each Unsecured Guarantor warrants that it has not taken, and agrees that (without the prior
written consent of the Agent acting on the instructions of the Majority Lenders) it will not
take, from any Obligor, any other Unsecured Guarantor or any person party to any related
security any encumbrance, guarantee or other assurance in respect of or in connection with its
obligations under this Agreement. If any Unsecured Guarantor takes any such encumbrance,
guarantee or other assurance in contravention of this Clause 13.7 (Warranty), it shall hold
the same on trust for the Beneficiaries until such time as all of the guaranteed obligations
have been satisfied in full and shall on request promptly deposit the same with and/or charge
the same to the Agent for and on behalf of itself and such persons in such manner as the Agent
may require as security for the due performance and discharge by the relevant Unsecured
Guarantor of the guaranteed obligations
	 
	 	 	Suspense Account
	 
	13.8	 	If any Obligor or any of the Unsecured Guarantors is wound up, goes into liquidation or makes
any composition or arrangement with its creditors, neither the existence of the guarantee of
the




53









 






	 	 	relevant Unsecured Guarantor contained in this Agreement nor any moneys received or
recovered by the Beneficiaries or any of them under to pursuant to this Agreement shall
impair the right of such persons to prove in such winding-up, liquidation, composition, or
arrangement for the total amount due from the Obligor or the relevant Unsecured Guarantor.
The Agent may at any time and from time to time place and, for so long as it thinks fit,
keep any moneys received or recovered under this Agreement in a separate or suspense
account, in such name as it thinks fit, without any intermediate obligation on its part to
apply the same in or towards discharge of any part of such total amount, provided that if
the moneys are at any time sufficient to discharge the guaranteed obligations in full,
they shall promptly be so applied.
	 
	 	 	Conditional Discharge
	 
	13.9	 	Any settlement or discharge between any of the Unsecured Guarantors and the Arranger, the
Agent, the Lenders or any of them shall be conditional upon no security or payment to the
Arranger, the Agent and the Lenders or any of them by any Obligor or the relevant Unsecured
Guarantor or any other person being avoided or set aside or ordered to be refunded or reduced
by or pursuant to any applicable law or regulation and, if such condition is not satisfied,
the Arranger, the Agent and the Lenders shall each be entitled to recover from the relevant
Unsecured Guarantor on demand the value of any such security or the amount of any such payment
as if such settlement or discharge had not occurred.
	 
	 	 	Guarantor Intent
	 
	13.10	 	Without prejudice to the generality of Clause 13.4 (Protective Provisions), each Unsecured
Guarantor expressly confirms that it intends that its obligations under this Agreement shall
extend from time to time to any (however fundamental) variation, increase, extension or
addition of or to any of the Finance Documents and/or any facility or amount made available
under any of the Finance Documents for the purposes of or in connection with any of the
following: the Group’s business, acquisitions of any nature; increasing working capital;
enabling investor distributions to be made; carrying out restructurings; refinancing existing
facilities; refinancing any other indebtedness; making facilities available to new borrowers;
any other variation or extension of the purposes for which any such facility or amount might
be made available from time to time; and any fees, costs and/or expenses associated with any
of the foregoing.
	 
	14.	 	REPRESENTATIONS AND WARRANTIES
	 
	 	 	General Representations and Warranties
	 
	14.1	 	Each Obligor represents and warrants (in respect of itself and each other Obligor) to and for
the benefit of each other party to this Agreement that, except as disclosed to and accepted by
the Agent in writing:
	 
	 	 	Status






	 	14.1.1	 	(other than in the case of BMEP) it is a limited liability company duly
incorporated or a corporation duly organised and validly existing under the laws of
its jurisdiction of incorporation and BMEP is a partnership properly established and
validly existing under the laws of the Netherlands, in each case having the power and
authority to own its assets and to conduct the business and operations which it
conducts or proposes to conduct;




54









 












Powers and authority




	 	14.1.2	 	it has full power and authority to enter into and perform each of the Relevant
Agreements to which it is or will be a party and any other document to be entered
into by it pursuant thereto and has taken all necessary corporate or other action to
authorise the execution, delivery and performance of each such Relevant Agreement and
each such other document;






Authorisations




	 	14.1.3	 	save for any necessary registrations which will be made within the applicable
registration period, all actions, conditions and things required by all applicable
laws and regulations to be taken, fulfilled, obtained or done in order (i) to enable
it lawfully to enter into, exercise its rights under and perform and comply with its
obligations under each of the Relevant Agreements to which it is or will be a party
and any other document to be entered into pursuant thereto (ii) to ensure that those
obligations are valid, legally binding and enforceable in accordance with their
respective terms and (iii) to make each of the Relevant Agreements and all such other
documents admissible in evidence in England and Wales and, if different, its
jurisdiction of incorporation have been taken, fulfilled, obtained or done;






Non-violation




	 	14.1.4	 	the execution by it of and the exercise by it of its rights and performance of or
compliance with its obligations under each of the Relevant Agreements to which it is
or will be a party do not and will not violate (i) any law or regulation to which it
or any of its assets is subject or (ii), to an extent or in a manner which has or
could have a material adverse effect on it, any agreement to which it is a party or
which is binding on it or its assets or conflict with its constitutional documents
and in particular will not cause any limit on its borrowing or other powers or the
exercise of such powers by its board of directors to be exceeded;






Obligations binding




	 	14.1.5	 	subject to the Reservations, its obligations under each of the Relevant Agreements
are legal, valid and binding and enforceable in accordance with their respective
terms;






Litigation




	 	14.1.6	 	save as disclosed in writing to and agreed by the Agent prior to the date of this
Agreement, it is not involved or engaged in any litigation, arbitration or
administrative proceedings (whether as plaintiff or defendant) nor, to the best of
its knowledge is any such litigation, arbitration or administrative proceedings
threatened, nor are there any circumstances likely to give rise to any such
litigation, arbitration or proceedings which in any such case may have a material
adverse effect on it, any other Obligor or on the Group (taken as a whole);






No default




	 	14.1.7	 	it is not in breach of or default under any agreement or arrangement (including,
without limitation, under any Relevant Agreement) or any statutory or legal
requirement to an extent or in a manner which has or could have a material adverse
effect on it or on any other Obligor and no Event of Default has occurred and is
continuing;




55









 












Existing encumbrances




	 	14.1.8	 	no encumbrance exists over its present or future assets except for Permitted
Encumbrances;






Future encumbrances




	 	14.1.9	 	the execution by it of each of the Relevant Agreements to which it is or will be a
party and the exercise by it of its rights and performance of or compliance with its
obligations thereunder will not result in the existence of or oblige it to create any
encumbrance over all or any of its present or future assets except for Permitted
Encumbrances;






Financial Statements




	 	 	14.1.10






	 	(a)	 	its audited consolidated Financial Statements were
prepared in accordance with Applicable GAAP and give a true and fair view of
the financial condition of the Group at the date as of which they were
prepared and the results of the Group’s business and operations during the
Financial Year then ended and (in the case of its Financial Statements)
disclose or reserve against all liabilities (contingent or otherwise) of
each Group Company as at that date and all unrealised or anticipated losses
from any commitment entered into by each Group Company and which existed on
that date;
	 
	 	(b)	 	the Latest Projections represent its best estimate of the
Group’s future financial performance for the periods referred to in them and
have been prepared on the basis of the stated assumptions, which it believes
are fair and reasonable in the light of current and reasonably foreseeable
business conditions;






Capitalisation




	 	14.1.11	 	the Adjusted Tangible Net Worth is not less than £26,936,000, BMEBV’s authorised
share capital consists of EUR90,000 of which 200 shares of EUR100 are validly issued
and fully paid and are owned beneficially by BMEP and BMUK’s authorised share capital
consists of 5,000,000 ordinary shares of £1 per share and 5,000,000 preference shares
of £1 per share, of which 4,000,500 ordinary shares and 1,225,963 preference shares
are validly issued and fully paid and are beneficially owned by BMEBV, in the case of
the ordinary shares, and the Parent, in the case of the preference shares;






Indebtedness




	 	14.1.12	 	no Group Company has any indebtedness except for Permitted Indebtedness;






Distributions




	 	14.1.13	 	since 1 January 2002 no Distribution has been declared, paid, or made upon or in
respect of any shares or other securities of any Group Company other than in
accordance with the provisions of Clause 16.3.3 (Distributions and changes in capital
structure);




56









 












Title to assets




	 	14.1.14	 	except for assets which are leased, it is the beneficial owner free from all
encumbrances (other than Permitted Encumbrances) of all its other assets including,
without limitation, the assets reflected on the most recent Financial Statements
delivered to the Agent, except as disposed of since the date thereof in the ordinary
course of trading;






Labour disputes




	 	14.1.15	 	there is no pending or, to the best of its knowledge, threatened strike, work
stoppage, material unfair labour practice claim, or other material labour dispute
against or affecting its or its employees;






Environmental Laws




	 	14.1.16	 	to the best of its knowledge and belief (having made all due and reasonable
enquiry) it has not breached any Environmental Law and no condition exists or act or
event has occurred which will or might reasonably be expected to give rise to any
breach of, or any liability of any kind under, any Environmental Law;






Environmental Authorisations




	 	14.1.17	 	to the best of its knowledge and belief (having made all due and reasonable
enquiry) it is in possession of all Environmental Authorisations required for the
conduct of its business or operations (or any part thereof) and it has not breached
any of the terms or conditions of any such Environmental Authorisation;






Notices of environmental breaches




	 	14.1.18	 	(i) it has not received any summons, complaint, order or similar written notice
that it is not in compliance with, or any public authority is investigating its
compliance with, any Environmental Law or that it is or may be liable to any other
person as a result of a potential or actual Discharge of a Hazardous Substance and
(ii) none of its present or past operations is the subject of any investigation by
any public authority evaluating whether any remedial action is needed to respond to a
potential or actual Discharge of a Hazardous Substance;






No deposit of Hazardous Substances




	 	14.1.19	 	to the best of its knowledge and belief (having made all due and reasonable
enquiry) no Hazardous Substance has at any time been used, disposed of, generated,
stored, transported, dumped, released, deposited, buried, discharged or emitted at,
on, from or under any premises owned, leased, occupied or controlled by it;






Liability for environmental claims




	 	14.1.20	 	it has not entered into any negotiations or settlement agreements with any person
(including, without limitation, any prior owner of its property) imposing material
obligations or liabilities on it with respect to any remedial action in response to
the potential or actual Discharge of a Hazardous Substance or environmentally related
claim;




57









 












Taxes




	 	14.1.21	 	it has filed all tax returns and other reports required to be filed and has paid
all taxes imposed on it or upon any of its assets that are due and payable (save for
any that are being contested in good faith and by appropriate action and in respect
of which it has provided or maintained adequate reserves to meet any such liability);






Material adverse change




	 	14.1.22	 	there has been no material adverse change in its financial condition or the
financial condition of the Group (taken as a whole) since the date to which the
latest audited Financial Statements were delivered to the Agent under Clause 15.2.1
(Financial Statements) were made up nor in the consolidated financial condition,
business, assets or operations of the Group nor in the Collateral since that date
which will nor might reasonably be expected to result in a material adverse effect;






Information




	 	14.1.23	 	all factual information delivered by it or on its behalf to the Agent in
connection with the business, operations and assets of the Group or in connection
with any of the Relevant Agreements from time to time was, in each such case at the
date of its delivery, true and correct in all material respects and not misleading
and all expressions of opinion, forecasts and projections have been arrived at in
good faith and have been based upon reasonable grounds;






Information Memorandum




	 	14.1.24	 	(a) all statements of fact contained in the Information Memorandum relating to the
Group are, or will be, true in all respects material to the Revolving Facility, (b)
all expressions of opinion or expectations and all forecasts and projections provided
in the Information Memorandum, have been, or will be, arrived at in good faith and
have been, or will be, based upon reasonable grounds (in each case as at the date at
which they are, or will be, made or expressed to be made and in final form), and (c)
it is not aware, having made all due and reasonable enquiry, of any facts or
circumstances that have not been disclosed to the Agent, the Arranger and the Lenders
which would, if disclosed, be reasonably likely to affect the decision of a person
considering whether or not to provide finance to the Borrowers;






Deductions and withholdings




	 	14.1.25	 	it is not required to make any deduction or withholding from any payment it may
make under this Agreement;






Winding-up




	14.1.26	 	neither it nor any other Group Company has taken any corporate action nor have any
other steps been taken or legal proceedings been started or (to the best of its
knowledge and belief) threatened against it or any Group Company for its winding-up,
dissolution or re-organisation (other than for the purposes of a bona fide solvent
scheme of reconstruction or amalgamation previously approved in writing by the Agent)
or for the appointment of a receiver, administrator, administrative receiver, trustee
or similar officer of it or of any or all of its assets.




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USD Co




	 	14.1.27	 	since the date of its incorporation (save for professional fees) the USD Co has
incurred no liabilities and has acquired no assets and has undertaken no transactions
other than the entry into of and the performance of its obligations under the Inter
Company Sale Agreement.
	 
	 	Accounts and Inventory






	14.2	 	Each Obligor represents and warrants to and for the benefit of each other party to this
Agreement that, except as disclosed to and accepted by the Agent in writing:






Accounts




	 	 	14.2.1






	 	(a)	 	each existing Account represents, and each future Account
will represent, a bona fide sale or lease and delivery of goods by a Trading
Company, or the rendering of services by a Trading Company, in the ordinary
course of such Trading Company’s business;
	 
	 	(b)	 	each existing Account is, and each future Account will
be, for a liquidated amount payable by the Account Debtor thereon on the
terms set forth in the invoice therefor or in the schedule thereof delivered
to the Agent, without set-off, deduction, defence, or counterclaim;
	 
	 	(c)	 	no payment will be received with respect to any Account,
and no credit, discount, or extension, or agreement therefor will be granted
on any Account, except as reported to the Agent in accordance with this
Agreement;
	 
	 	(d)	 	each copy of an invoice delivered to the Agent will be a
genuine copy of the original invoice sent to the Account Debtor named in it;
and
	 
	 	(e)	 	all goods described in any invoice representing a sale of
goods will have been delivered to the Account Debtor and all services of any
Trading Company described in any invoice will have been performed;






Inventory




	 	14.2.2	 	with effect from any Inventory Eligibility Date, in relation to each Trading
Company, all of its Inventory is and will be held for sale or lease, or to be
furnished in connection with the rendering of services in the ordinary course of its
business and is and will be fit for such purpose and will be kept by it, at its own
expense, in good and marketable condition (save for damaged or obsolete items as
notified to and agreed by the Agent).






Repetition




	14.3	 	Each of the representations and warranties in Clauses 14.1 (General Representations and
Warranties) and 14.2 (Accounts and Inventory) will be correct and complied with on the date of
this Agreement and the Effective Date and (other than the representations in Clauses 14.1.13
(Distributions), 14.1.24 (Information Memorandum) and 14.1.25 (Deductions and Withholdings))
will also be correct and complied with on each date on which a Loan is requested or to be made
(or, as the case may be, a Letter of Credit or Guarantee is issued or requested to be issued)
and on each date on which a Prepayment (as defined in the Accounts




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	 	 	Transfer Conditions) is made under an Invoice Discounting Agreement as if repeated then by
reference to the then existing circumstances.
	 
	15.	 	FINANCIAL CONDITION
	 
	 	 	Books and Records





15.1





Maintenance




	 	15.1.1	 	BMEH shall maintain, and shall procure that each Group Company shall maintain, at
all times, books, records and accounts which are complete and correct in all material
respects and in relation to which timely entries are made of their transactions in
accordance with Applicable GAAP. BMEH shall, and shall procure that each Group
Company shall, by means of appropriate entries, reflect in such accounts and in all
Financial Statements proper liabilities and reserves for all taxes and proper
provision for depreciation and amortisation of any property or asset and bad debts,
all in accordance with Applicable GAAP. BMEH shall, and shall procure that each
Group Company shall, maintain at all times books and records pertaining to any
applicable Collateral in such detail, form and scope as the Agent shall reasonably
require, including without limitation records of (i) all payments received and all
credits and extensions granted with respect to the Accounts; (ii) the return,
rejection, repossession, stoppage in transit, loss, damage or destruction of any
Inventory; and (iii) all other dealings affecting the Collateral.






Access




	 	15.1.2	 	BMEH and/or, as applicable, BMUK shall, upon receiving not less than two business
days’ notice from the Agent (or without notice following a Default which is
continuing), permit and procure that each Group Company permits the Agent or any
person authorised by the Agent at any reasonable time to have access to its premises
and books, records and accounts and to make extracts from and take copies of such
books, records and accounts.






Provision of Financial Information




	15.2	 	BMEH, BMEP, BMEBV, BMEE and BMUK shall each deliver to the Agent in sufficient copies for
each of the Lenders:






Financial Statements




	 	15.2.1	 	as soon as the same become available, but in any event within 120 days after the
end of each Financial Year, the audited consolidated Financial Statements of the
Group for such Financial Year together with (i) the audited statutory accounts of
each Group Company for such Financial Year and (ii) a consolidation of such audited
Financial Statements for each member of the BMUK/IDFC Group and to the extent that
any Financial Statements have been prepared in accordance with or otherwise converted
to or conformed with US GAAP, such Financial Statements shall be accompanied by a
note or similar document prepared by the Auditors (or prepared by the Parent and
signed by the Auditors) which (a) reconciles the Financial Statements to the
Management Accounts delivered for the relevant Financial Year pursuant to clause
15.2.2 and (b) explains, in reasonable detail, any changes or adjustments made to the
figures contained in such Management Accounts, to comply with US GAAP;






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	 	 	Management Accounts






	 	15.2.2	 	as soon as the same become available, but in any event within 25 days of the end of
each Management Accounting Period, Management Accounts of itself and each member of
the Group (other than the members of the Restricted Group) (incorporating, without
limitation, a break-out of all intercompany balances) as at the end of and for that
Management Accounting Period and, in relation to the Management Accounting Periods
ending on 31 March, 30 June, 30 September and 31 December in each year, within 45
days of the end of such Financial Quarter a consolidation of those Management
Accounts showing the consolidated and consolidating financial position for the
Financial Quarter ending on each such date and for the Financial Year to date and a
further consolidation of those Management Accounts showing the consolidated and
consolidating financial position for the Financial Quarter ending on each such date
and for the Financial Year to date of each member of the BMUK/IDFC Group;






	 	 	Latest Projections






	 	15.2.3	 	no sooner than 90 days and no later than 15 days prior to the beginning of each
Financial Year, consolidated and consolidating projected balance sheets, statements
of income and expense and statements of cash flow for the BMUK/IDFC Group and the
Group as at the end of and for each month of such Financial Year and a statement of
projected EBITDA from the start of such Financial Year to the end of each Financial
Quarter falling within such Financial Year (such projected EBITDA calculations to be
acceptable to the Agent);






	 	 	Capital Expenditure






	 	15.2.4	 	within 45 days after the end of each Financial Quarter, a report of the Capital
Expenditure of the Group for such Financial Quarter and forecast of the projected
Capital Expenditure for the remainder of the then current Financial Year or, in the
case of the last Financial Quarter in any Financial Year, for the following Financial
Year;






	 	 	Taxes and Claims






	 	15.2.5	 	together with the Management Accounts delivered under Clause 15.2.2 (Management
Accounts) a certificate signed by the finance director of BMUK that all the sums
referred to in Clause 16.2.6 (Payment of taxes and Claims) have been paid in respect
of the period covered by such Management Accounts;






	 	 	General information






	 	15.2.6	 	at the same time as sent to its shareholders or creditors generally, any circular,
document or other written information sent to its shareholders or creditors as such
or the shareholders or creditors of any other Obligor;






	 	 	Quarterly Sales Certificates






	 	15.2.7	 	BMUK shall, at the same time as it delivers the Management Accounts that are
required to be delivered to the Agent in accordance with Clause 15.2.2 (Management
Accounts) following the end of a Financial Quarter, deliver to the Agent a
certificate (signed by its finance director) (a “Quarterly Sales Certificate”)
specifying (1) the total sales (the “Total Year 1 Sales”) made by the Group in the 12
month period to the end of that Financial Quarter (the “Previous Sales Year”), (2)
the total sales (the




61









 






	 	 	 	“Total Year 2 Sales”) made by the Group in the 12 month period immediately
preceding the Previous Sales Year and (3) the total sales (the “Total Lost
Customer Sales”) made by the Group in the Previous Sales Year to customers to
whom sales have not been made in the previous Financial Quarter;






	 	 	Quarterly Supply Certificates






	 	15.2.8	 	BMUK shall, at the same time as it delivers the Management Accounts that are
required to be delivered to the Agent in accordance with Clause 15.2.2 (Management
Accounts) following the end of a Financial Quarter, deliver to the Agent a
certificate (signed by its finance director) (a “Quarterly Supply Certificate”)
specifying (1) the total amount invoiced to the Group by suppliers of goods and
services to the Group (the “Total Year 1 Supply Costs”) in the 12 month period to the
end of that Financial Quarter (the “Previous Purchasing Year”), (2) the total amount
invoiced to the Group by suppliers of goods and services to the Group (the “Total
Year 2 Supply Costs”) in the 12 month period immediately preceding the Previous
Purchasing Year and (3) the total amount invoiced to the Group by suppliers of goods
and services to the Group (the “Total Reduced Supply Costs”) in the Previous
Purchasing Year and from whom the Group has not received invoices in respect of goods
or services supplied by those suppliers in the previous Financial Quarter; and






	 	 	Other information






	 	15.2.9	 	from time to time on the request of the Agent, such information about the business,
operations and financial condition of each Group Company as the Agent may reasonably
require, other than any information disclosure of which will cause such Group Company
to breach any confidentiality undertaking to which it is a party, in which case it
shall and shall procure that any relevant Group Company shall, use all reasonable
efforts to procure the consent of the counterparty to such undertaking to make
disclosure.






	 	 	Financial Information — basis of preparation
	 
	15.3	 	BMEH, BMEP, BMEBV, BMUK and BMEE shall each ensure that:
	 
	 	 	True and fair view






	 	15.3.1	 	each set of Financial Statements delivered by it or at its request pursuant to
Clause 15.2.1 (Financial Statements) is prepared (except as stated therein) using the
same accounting principles and policies as were used in the preparation of the BMUK
Pro-Forma Balance Sheet and gives a true and fair view of the financial condition of
the BMUK/IDFC Group and of the Group, as the case may be, as at the end of the period
to which those Financial Statements relate and of the result of their respective
businesses and operations during such period;






	 	 	Audit






	 	15.3.2	 	each set of Financial Statements delivered by it or at its request pursuant to
Clause 15.2.1 (Financial Statements) has been audited by the Auditors and each set of
Management Accounts delivered by it pursuant to Clause 15.2.2 (Management Accounts)
has been certified as being correct by BMUK (acting through its finance director),
subject to normal year-end adjustments;




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	 	 	Certificate of BMUK






	 	15.3.3	 	each set of Financial Statements delivered pursuant to Clause 15.2.1 (Financial
Statements) and each set of Management Accounts delivered by it pursuant to Clause
15.2.2 (Management Accounts) in respect of a Management Accounting Period ending on
the last day of any Financial Quarter (as consolidated for that Financial Quarter) is
accompanied by a certificate of BMUK (acting through its finance director) setting
forth in reasonable detail (i) when delivered with the Financial Statements delivered
pursuant to Clause 15.2.1 (Financial Statements) only, the calculations required to
show the actual EBITDA achieved from the start of the Financial Year to which those
Financial Statements relate to the end of each Financial Quarter falling within that
Financial Year and the Variance (if any) for each Financial Quarter falling within
that Financial Year and (ii) in each case, the calculations required to establish
that BMUK was in compliance with its covenants set forth in Clause 15.4 (Financial
Ratios) during the period covered in such Financial Statements (or, as the case may
be, during such Financial Quarter) and stating that, except as explained in
reasonable detail in such certificate:






	 	(a)	 	all of the representations and warranties of each Obligor
contained in this Agreement and the other Finance Documents are correct and
complete as at the date of such certificate as if made at such time; and
	 
	 	(b)	 	no Event of Default then exists or existed during the
period covered by such Financial Statements or, as the case may be,
Management Accounts,






	 	 	 	and describing and analysing in reasonable detail all material trends, changes
and developments in such Financial Statements or Management Accounts. If such
certificate discloses that a representation or warranty is not correct or
complete, or that a covenant has not been complied with, or that an Event of
Default existed or exists, such certificate shall set forth what action BMUK or
the relevant Obligor has taken or proposes to take with respect thereto.






	 	 	Financial Ratios
	 
	15.4	 	BMUK shall ensure that, at all times, the consolidated financial condition of the BMUK/IDFC
Group shall be such that Adjusted Tangible Net Worth shall not at any time be less than
£26,936,000 as determined at the end of each Financial Quarter by reference to the accounting
information (the “Relevant Accounting Information”) most recently delivered under this
Agreement being (i) the Financial Statements delivered under Clause 15.2.1 (Financial
Statements) and (ii) each set of Management Accounts (consolidated and consolidating for the
relevant Financial Quarter) delivered under Clause 15.2.2 (Management Accounts). In this
Agreement, unless the context otherwise requires:
	 
	 	 	“Adjusted Tangible Assets”: means all of the BMUK/IDFC Group’s assets except:






	 	(i)	 	deferred assets, other than prepaid insurance and prepaid taxes;
	 
	 	(ii)	 	patents, copyrights, trademarks, trade names, franchises, goodwill and
other similar intangibles;
	 
	 	(iii)	 	Restricted Investments;
	 
	 	(iv)	 	unamortised debt discount and expense;
	 
	 	(v)	 	assets constituting Intercompany Accounts; and




63









 






	 	(vi)	 	fixed assets to the extent of any write-up in the book value thereof
resulting from a revaluation effective after the date of this Agreement; and






	 	 	“Adjusted Tangible Net Worth”: means, at any date:






	 	(i)	 	the book value (after deducting related depreciation, amortisation,
valuation and other proper reserves as determined in accordance with Applicable GAAP)
at which the Adjusted Tangible Assets would be shown on a consolidated balance sheet
of the BMUK/IDFC Group at such date prepared in accordance with Applicable GAAP; less
	 
	 	(ii)	 	the amount at which the BMUK/IDFC Group’s liabilities would be shown on
such balance sheet, including as liabilities all reserves for contingencies and other
potential liabilities which would be required to be shown on such balance sheet.






	 	 	Changes in basis of preparation of Relevant Accounting Information
	 
	15.5	 	Where any Relevant Accounting Information to be delivered under clause 15 has been prepared
in a manner which is inconsistent with the accounting principles or policies in accordance
with which the Pro-Forma Balance Sheet was prepared, whether as a result of any change in such
principles or otherwise, BMEH or BMUK shall provide to the Agent a written explanation of any
such inconsistency, together with details of its effects. If any such inconsistency would be
likely to affect the ability of the Agent to satisfy itself from the information delivered as
Relevant Accounting Information as to compliance with the provisions of Clause 15.4 (Financial
Ratios), the Agent shall have the right to adjust the financial ratios set out in Clause 15.4
(Financial Ratios) or the relevant definitions set out in Clause 15.4 (Financial Ratios) so as
to reflect so far as is practicable the effect of any such change (provided that the effect of
such adjustments, taking into consideration such change, shall not be such as to render the
said financial ratios more onerous upon BMUK than as at the date of this Agreement).
	 
	16.	 	COVENANTS
	 
	 	 	Duration
	 
	16.1	 	The undertakings in this Clause 16 (Covenants) shall remain in force from the date of this
Agreement and so long as any amount is outstanding under this Agreement.
	 
	 	 	Positive covenants
	 
	16.2	 	Each Obligor undertakes that:
	 
	 	 	Consents






	 	16.2.1	 	it will, and will procure that each of the Obligors will, obtain, comply with the
terms of and do all that is necessary to maintain in full force and effect all
authorisations, approvals, licences and consents required by all applicable laws and
regulations to enable it lawfully to enter into, perform and comply with its
obligations under each of the Relevant Agreements to which it is or will be a party
and any document to be entered into pursuant thereto or to ensure the legality,
validity, enforceability or admissibility in evidence of such Relevant Agreements and
each such document in England and Wales and, if different, its jurisdiction of
incorporation and any jurisdiction in which any of its assets may be situated;




64









 












	 	 	Insurance






	 	16.2.2	 	it will maintain, and procure that each Obligor maintains, policies of insurance on
and in relation to its business and assets with financially sound and reputable
insurers acceptable to the Agent against such risks and to such extent as is usual
for companies carrying on a business such as that carried on by it and each Obligor
whose practice is not to self insure;






	 	 	Compliance with law






	 	16.2.3	 	it will comply, and will procure that each Obligor complies, with all applicable
laws and regulations including, without limitation, any applicable Environmental Law;






	 	 	Environmental Laws






	 	16.2.4	 	it will, and will procure that each Obligor will, take prompt and appropriate
action to respond to and remedy any non-compliance with any Environmental Law and
shall regularly report to the Agent on such response and remedying. Without limiting
the generality of the foregoing, whenever BMUK gives notice to the Agent of such
non-compliance pursuant to Clause 16.2.7 (Notices to Agent) BMUK will, at the Agent’s
request and BMUK’s expense:






	 	(a)	 	cause an independent environmental engineer acceptable to
the Agent to investigate and conduct such tests of the site where any
Obligor’s non-compliance or alleged non-compliance with any Environmental
Law has occurred and prepare and deliver to the Agent a report setting forth
the results of such tests, a proposed plan for responding to any
environmental problems described therein, and an estimate of the costs
thereof; and
	 
	 	(b)	 	provide to the Agent a supplemental report of such
engineer whenever the scope of the environmental problems, or BMUK’s
response thereto or the estimated costs thereof, changes;






	 	 	Conduct of business






	 	16.2.5	 	it has, and will ensure that each Obligor has, the right to conduct its business
and operations as they are conducted in all applicable jurisdictions and will do, and
will procure that each Obligor does, all things necessary (including compliance with
all terms and conditions of any licences and consents) to obtain, preserve and keep
in full force and effect all rights, licences and consents) to obtain, preserve and
keep in full force and effect all rights, licences and authorisations (including,
without limitation, all Environmental Authorisations) and consents as are necessary
for the conduct of such business and operations;






	 	 	Payment of taxes and claims






	 	16.2.6	 	 






	 	(a)	 	it will, and will procure that each Obligor will, and
BMEBV will procure that each IDF Company will, duly and punctually pay and
discharge (i) all taxes imposed upon it or its properties (save where the
same are being contested in good faith and by appropriate proceedings and
where adequate reserves are being maintained with respect thereto) and (ii)
all lawful claims which, if unpaid, would by law become encumbrances upon
any of its properties; and




65









 






	 	(b)	 	BMEBV will procure that each IDF Company will duly and
punctually pay and discharge all obligations to:






	 	(i)	 	pay all emoluments and benefits to
which its employees are entitled (including, without limitation,
all wages and salaries, sick pay, maternity pay, pension
contributions, bonuses, commission, any liability to taxation
(including income tax and national insurance contributions deducted
or deductible from such amounts under the PAYE system in the United
Kingdom or such equivalent taxation and social security payments))
in its jurisdiction of incorporation; and
	 
	 	(ii)	 	comply with (in all material respects)
all statutes, regulations and collective agreements relevant to the
conditions of service of its employees or to the relations between
it and its employees (or former employees, as the case may be), any
recognised trade union or works council and the laws applicable to
the employment of the employees in its jurisdiction of
incorporation;






	 	 	Notices to Agent






	 	16.2.7	 	BMUK will notify the Agent in writing of the following matters at the following
times (each such notice to describe the subject matter thereof in reasonable detail
and to set out the action that BMUK or the relevant Obligor has taken or proposes to
take with respect thereto):






	 	(a)	 	immediately after becoming aware of the existence of any
Default;
	 
	 	(b)	 	immediately after becoming aware that any shareholder in,
or any creditor of, any Obligor has given notice or taken any action with
respect to a claimed default by such Obligor and in circumstances where such
shareholder or creditor has taken or is threatening to take any action or
steps which will or might reasonably be expected to have a material adverse
effect;
	 
	 	(c)	 	immediately after becoming aware of any material adverse
change in the assets, business, operations or condition (financial or
otherwise) of any Obligor or of the Group (taken as a whole);
	 
	 	(d)	 	immediately after becoming aware of any pending or
threatened action, suit, proceeding or counterclaim by any person which may
have a material adverse effect on any Obligor, or any pending or threatened
investigation by a public authority;
	 
	 	(e)	 	immediately after becoming aware of any pending or
threatened strike, work stoppage, material unfair labour practice claim, or
other material labour dispute affecting any Obligor;
	 
	 	(f)	 	immediately after becoming aware of any violation of any
law, statute, regulation, or ordinance of a public authority applicable to
any Obligor or its assets which may have a material adverse effect on it or
on such Obligor;
	 
	 	(g)	 	immediately after becoming aware of any violation by any
Obligor of any Environmental Law or immediately upon receipt of any notice
(including a works notice) delivered pursuant to any Environmental Law or of
any notice




66









 






	 	 	 	that a public authority has asserted that any Obligor is not in
compliance with any Environmental Law or that its compliance is being
investigated;
	 
	 	(h)	 	ten (10) days prior to any Obligor changing its name or
the address of its registered office;
	 
	 	(i)	 	immediately upon becoming aware that any Group Company
has received a notice or other document from any of its suppliers notifying
such Group Company of a breach by such Group Company of any supply agreement
to which it is a party;






	 	 	Hedging






	 	16.2.8	 	BMUK and each other relevant Borrower shall, within 60 days of the Closing Date or,
in the case of any Additional Borrower, within 60 days of the date upon which it
becomes an Additional Borrower, enter into such Hedging Agreements with a Hedge
Provider as the Agent may require (after consultation with BMUK) and in such form as
the Agent (acting reasonably) may require;






	 	 	St. Crispin Property






	 	16.2.9	 	BMUK shall promptly notify the Agent of any proposed refinancing of all or any part
of the financial indebtedness secured by any encumbrance over the St. Crispin
Property and shall not complete such refinancing without the St Crispin Mortgagee
having entered into any intercreditor deed or other priority arrangements in form and
substance mutually acceptable to the relevant replacement St. Crispin Mortgagee, BMUK
and the Agent;
	 
	 	16.2.10	 	[Intentionally omitted.]






	 	 	Material Contracts and terms of business with Account Debtors






	 	16.2.11	 	it will and will procure that each relevant Trading Company will promptly notify
the Agent of:






	 	(a)	 	any proposed change in, or amendment to, any Material
Contract or its terms of business with Account Debtors including, without
limitation, any material change to any retention of title or similar
provisions but excluding in each case minor or routine changes or amendments
which could not reasonably be expected to have a materially adverse effect
on the interests of the Lenders or the Receivables Purchaser;
	 
	 	(b)	 	any material or persistent breach by any relevant Trading
Company or any other party to any of the Material Contracts and, if
relevant, of any steps being taken or proposed to remedy such breach; and
	 
	 	(c)	 	any proposal to repudiate or cancel, or any purported
repudiation or cancellation of, any of the Material Contracts;






	 	 	Additional Security






	 	16.2.12	 	without prejudice to the obligations of each of the Obligors pursuant to the
Security Documents to which each of them it is expressed to be a party, it will grant
or procure that there is granted to the Security Trustee, such new or further
security (“additional security”) over any business, shares or other assets which may
be acquired pursuant




67









 






	 	 	 	to any Pre-Approved Acquisition or any other acquisition permitted pursuant to
the Finance Documents; any such additional security shall be in such form and
contain such terms and conditions as the Agent or the Lenders (having carried out
all necessary due diligence) may require having regard to the nature and location
of the assets in question and shall be required to be effected in favour of the
Security Trustee within 90 days (or such later date as the Agent may agree) of
the date of completion of the relevant acquisition; it will provide the Security
Trustee with such evidence as the Security Trustee may require that all
applicable laws and regulations relating to the execution of such additional
security have been duly complied with (including any statutory declarations
and/or special resolutions required under sections 155 and 156 Companies Act
1985; all costs and expenses (including legal fees) incurred by any of the
Beneficiaries in preparing, negotiating and perfecting any such additional
security shall be for the account of BMUK;






	 	 	Dormant Companies






	 	16.2.13	 	it will ensure that each of the Dormant Companies remains dormant and promptly
notify the Agent of any proposal for any of such companies to recommence trading,
which they shall not be permitted to do unless BMUK has received the prior written
consent of the Agent;






	 	 	Excess Availability






	 	16.2.14	 	the average daily Excess Availability (calculated for each month on the last day
of such month) shall be not less than £4,000,000;






	 	 	EC Insolvency Regulation






	 	16.2.15	 	it will maintain, and procure that all other members of the BMUK Group maintain,
its centre of main interests (within the meaning of the EC Insolvency Regulation) in
the United Kingdom.






	 	 	USD Co






	 	16.2.16	 	it will procure that the USD Co will (and the USD Co undertakes that it shall):






	 	(a)	 	maintain books and records separate from any other person
or entity;
	 
	 	(b)	 	maintain its accounts separate from any other person or
entity;
	 
	 	(c)	 	ensure that all of its assets are capable of being
identified as belonging to the USD Co and are readily capable of being
removed without any physical obstruction or impediment or any interference
as a result of the exercise of the rights of any Group Company, member of
the Restricted Group or of any other third party or any agent or other
person acting on behalf of any of them;
	 
	 	(d)	 	conduct its own business in its own name;
	 
	 	(e)	 	maintain separate financial statements;
	 
	 	(f)	 	observe all statutory obligations imposed on private
limited companies generally;
	 
	 	(g)	 	use stationery and invoices in its name only;




68









 






	 	(h)	 	hold itself out as a separate entity;
	 
	 	(i)	 	take prompt action to correct any known misunderstanding
on the part of any person dealing with the USD Co regarding its separate
identity; and
	 
	 	(j)	 	maintain its registered office and established place of
business in England and Wales and carry out its business in England and
Wales and maintain its centre of main interests (within the meaning of the
EC Insolvency Regulation) in the United Kingdom.






	 	 	Negative Covenants
	 
	16.3	 	Each Obligor undertakes that:
	 
	 	 	Encumbrances






	 	16.3.1	 	it will not, and will ensure that no Obligor will, without the prior written
consent of the Agent, create, agree to create or permit to subsist any encumbrance on
or over their respective assets to secure any indebtedness of any person other than
the following:






	 	(a)	 	any encumbrance on or over the assets of any Obligor
subsisting at the Effective Date and agreed to by the Agent (and in the case
of the encumbrances held by the St. Crispin Mortgagee, any replacement
thereof) provided that the principal, capital or nominal amount secured by
any such encumbrance may not be increased beyond the amount currently
secured by the relevant encumbrance as at the Effective Date without the
prior written consent of the Agent;
	 
	 	(b)	 	encumbrances in favour of the Security Trustee;
	 
	 	(c)	 	the Pledge Agreements;
	 
	 	(d)	 	liens or rights of set-off arising solely by operation of
law incurred in the ordinary course of business and not in connection with
the borrowing of money, for sums not more than 30 days overdue;
	 
	 	(e)	 	encumbrances arising out of title retention provisions in
a supplier’s standard conditions of supply in respect of goods acquired by
the relevant person in the ordinary course of trading;
	 
	 	(f)	 	any other encumbrance created or outstanding with the
prior written consent of the Agent;
	 
	 	(g)	 	agreements and arrangements of the type referred to in
Clause 16.3.5(d) to the extent that the same constitute security;
	 
	 	(h)	 	any encumbrance over any asset (other than Accounts or
Inventory) acquired by any Obligor after the date of this Agreement and
subject to which such asset is acquired provided that (1) except with the
prior written consent of the Agent, the principal, capital or nominal amount
secured by such encumbrance may not be increased beyond the amount secured
thereby at the date of such acquisition and (2) the same is discharged
within 90 days of the date of such acquisition;




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	 	(i)	 	any encumbrance over the assets of any company which
becomes a Subsidiary after the date of this Agreement pursuant to Clause
16.3.11 (Subsidiaries) provided that (1) except with the prior written
consent of the Agent, the principal, capital or nominal amount secured by
such encumbrance may not be increased beyond the amount secured thereby at
the date of the acquisition and (2) the same is discharged within 90 days of
the date of such acquisition;






	 	 	 	provided that, in the case of any encumbrance created or existing pursuant to sub
paragraphs (a) and (f) above, it shall be a condition to the creation of such
encumbrance that BMUK shall, if so requested by the Agent, procure that the
beneficiary of the relevant encumbrance shall accede to an intercreditor deed or
other priority arrangement on terms acceptable to the Agent;






	 	 	Disposals






	 	16.3.2	 	without the prior written consent of the Agent, it will not, and it will ensure
that no Group Company will (whether by a single transaction or a number of related or
unrelated transactions and whether at one time or over a period of time), sell,
transfer, assign, lease out, lend or otherwise dispose of (whether outright, by a
sale and repurchase or sale and leaseback arrangement or otherwise) any part of its
or their assets having an aggregate value in excess of £750,000 in any one Financial
Year except, sales of Inventory in the ordinary course of trading, sales to
Affiliates permitted under Clause 16.3.8 (Transactions with Affiliates) and sales of
Equipment permitted under Clause 16.4.11 (Disposal of the Equipment) provided that,
where any matter relating to any leasing, sub-leasing or other similar arrangement
with respect to the St. Crispin Property requires the consent of the Agent pursuant
to the terms of this Clause 16.3.2 (Disposals), such consent shall not be withheld if
the relevant subject matter also requires the consent of the St. Crispin Mortgagee
and the St. Crispin Mortgagee has granted its consent to such matter;






	 	 	Distributions and changes in capital structure






	 	16.3.3	 	without the prior written consent of the Agent:






	 	(a)	 	it will not, and it will ensure that no Group Company
will, directly or indirectly declare, make or pay, or incur any liability to
make or pay, any Distribution, or return any capital to any shareholder by
way of capital reduction or otherwise, provided that:






	 	(i)	 	BMEE may make Distributions or returns
of capital to BMUK;
	 
	 	(ii)	 	BMUK and any one or more of the IDF
Companies may make Distributions or returns of capital to BMEBV;
	 
	 	(iii)	 	BMEBV may make Distributions or
returns of capital to BMEP;
	 
	 	(iv)	 	BMEP may make Distributions or returns
of capital to BMEH; and
	 
	 	(v)	 	BMEH may make Distributions or returns
of capital to the Parent,






	 	 	 	so long as all of such payments in aggregate, together with the
aggregate principal amount of all loans made pursuant to Clause
16.3.7(a) (Loans and guarantees), do not exceed £2,000,000 (or the
equivalent in any other currency) in any Financial Year and do not
exceed £6,000,000 (or the




70









 






	 	 	 	equivalent in any other currency) during the term of this Agreement but,
for the avoidance of doubt, no Group Company may make any Distribution
to any member of the Restricted Group;
	 
	 	 	 	 and provided further that the Agent shall have received a
certificate signed by the finance director of BMUK confirming that:
	 
	 	 	 	(1) each of the Obligors is in compliance with all of its obligations
under the Finance Documents to which it is a party and no Default has
occurred and is continuing or will result from the payment of the
Distribution or return of capital proposed;
	 
	 	 	 	(2) there is Excess Availability under the Revolving Facility of not
less than £5,000,000 as at the date of such certificate and there will
be an average Excess Availability of not less than £5,000,000 both as at
the proposed date of payment of the relevant Distribution or return of
capital and for a continuous period of six (6) months thereafter; and
	 
	 	 	 	(3) in the case of a Distribution to be paid by BMEH to the Parent only,
the largest twenty (20) trade creditors of the Borrowers (as a whole)
are being paid in full when the relevant amounts become due in
accordance with their prevailing credit terms; and
	 
	 	(b)	 	it will not, and it will ensure that no Group Company
will, make any change in the capital structure of any Group Company which
could have a material adverse effect on any Obligor or the Group (taken as a
whole);






	 	 	Transactions having a material adverse effect






	 	16.3.4	 	it will not, and it will ensure that no Obligor will, enter into any transaction
which has or might reasonably be expected to have, a material adverse effect on any
Obligor;






	 	 	Indebtedness






	 	16.3.5	 	it will not, and it will ensure that no Group Company will, incur or maintain any
indebtedness other than:






	 	(a)	 	indebtedness under the Finance Documents;
	 
	 	(b)	 	trade payables and contractual obligations to suppliers
and customers incurred in the ordinary course of trading;
	 
	 	(c)	 	indebtedness between members of the Group as disclosed to
and permitted by the Agent;
	 
	 	(d)	 	indebtedness under any finance leases disclosed to the
Agent prior to the date of this Agreement or which are fully disclosed in
the Latest Projections and budgets for Capital Expenditure of the Group as
delivered to the Agent pursuant to Clauses 15.2.3 (Latest Projections) and
15.2.4 (Capital Expenditure) and as approved by the Agent;
	 
	 	(e)	 	indebtedness due and owing under any foreign exchange or
interest-rate swap, under any option, cap, collar or floor or under any
other hedging agreement or similar arrangement with any bank or other
financial institution and disclosed to the Agent prior to the date of this
Agreement and any




71









 






	 	 	 	replacement thereof or other hedging arrangement (which is intended to
hedge exposure to interest rate or currency exchange fluctuations and
not an arrangement of a speculative nature) entered into after the date
of this Agreement, in the case of interest rate hedging only, with the
prior written consent of the Agent and provided that, if the relevant
Hedge Provider is not the Arranger, any financial indebtedness due and
owing under the relevant hedging arrangement may not be secured without
the consent of the Agent (acting on the instructions of all of the
Lenders); or
	 
	 	(f)	 	indebtedness due and owing by BMUK to the Parent provided
that (a) such indebtedness is unsecured and is incurred on terms no less
favourable to BMUK than would be applicable in a comparable arm’s length
transaction with a third party that is not an Affiliate and (b) the
aggregate amount of such indebtedness does not exceed at any time
US$15,000,000; or
	 
	 	(g)	 	Bank Product Debt
	 
	 	(h)	 	indebtedness due and owing by BMUK to the St. Crispin
Mortgagee, provided that the aggregate principal amount of such indebtedness
may not be increased after the Effective Date; or
	 
	 	(i)	 	indebtedness due and owing:






	 	(i)	 	by BMUK to BMEBV provided that (a) such
indebtedness is unsecured and is incurred on terms no less
favourable to BMUK than would be applicable in a comparable arm’s
length transaction with a third party that is not an Affiliate and
(b) the aggregate amount of such indebtedness does not exceed at
any time US$40,000,000; and
	 
	 	(ii)	 	by BMEBV to BMEP provided that (a) such
indebtedness is unsecured and is incurred on terms no less
favourable to BMEBV than would be applicable in a comparable arm’s
length transaction with a third party that is not an Affiliate and
(b) the aggregate amount of such indebtedness does not exceed at
any time US$40,000,000;






	 	(j)	 	indebtedness due and owing by BMEH to the IBM Entities
under the BMEH IBM Guarantees;
	 
	 	(k)	 	indebtedness due and owing by BMEH to Mr Klaus Reichl
under the BMEH Reichl Guarantee,






	 	 	 	and will not, in any event, pay any amount in respect of any financial
indebtedness due to the St Crispin Mortgagee, save in accordance with the
provisions of the St. Crispin Priority Agreement or any subsequent intercreditor
deed or priority arrangement approved by the Agent in accordance with this
Agreement;






	 	 	Prepayment






	 	16.3.6	 	it will not, and it will ensure that no Group Company will, voluntarily prepay or
redeem any financial indebtedness, save that each Borrower may make prepayments under
this Agreement in accordance with its terms and save that any Group Company may, in
the ordinary course of business, make early payments to any trade creditor;




72









 












	 	 	Loans and guarantees






	 	16.3.7	 	it will not, and will ensure that no Group Company will, make, roll-over or
continue to remain outstanding any loans, grant any credit (save in the ordinary
course of trading) or give any guarantee to or for the benefit of any person (other
than any guarantee permitted pursuant to Clause 16.4.15 (St. Crispin Property
Guarantee)) or otherwise voluntarily assume any liability, whether actual or
contingent, in respect of any obligation of any other person, save that:






	 	(a)	 	BMEH, BMEP, BMEBV, each of the Borrowers and IDF
Companies may make any loans or grant any credit to each other or to the
Parent and to any one or more of the IDF Companies (but, subject to
paragraph (d) and (e) of this Clause 16.3.7 (Loans and guarantees), not to
any member of the Restricted Group) which, in the case of loans to the
Parent and/or BMEH and/or BMEP and/or BMEBV, in aggregate (and taking into
account the aggregate amount of any Distributions or returns of capital made
by any such persons to the Parent and/or BMEH and/or BMEP and/or BMEBV in
accordance with the terms of Clause 16.3.3 (Distributions and changes in
capital structure)), do not exceed £2,000,000 (or the equivalent in any
other currency) in any period of twelve (12) months commencing on the
Closing Date and do not exceed £6,000,000 (or the equivalent in any other
currency) during the term of this Agreement;
	 
	 	(b)	 	a Group Company may make loans to its employees (other
than its directors) provided that the aggregate amount of all such loans
made by all of the Group Companies shall not exceed £20,000;
	 
	 	(c)	 	a Group Company may roll-over or continue to make
available (but not increase the principal amount thereof, other than through
the capitalisation of accrued interest) any existing loans or financial
accommodation to any other Group Company or, subject to any other applicable
restrictions in this Agreement, to a member of the Restricted Group (and for
the avoidance of doubt the aggregate amount of loans and accrued interest
outstanding to the Restricted Group as at the Effective Date is €
8,302,070);
	 
	 	(d)	 	BMEH may make loans or other financial accommodation to
one or more members of the Restricted Group, provided always that BMEH is
able to provide evidence satisfactory to the Agent (acting reasonably),
whether by way of the provision of Management Accounts, Financial Statements
or otherwise, from which the Agent is able to determine that such loans or
other advances will be funded wholly out of new funds made available to BMEH
after the Closing Date by loans from the Parent or which have otherwise been
invested in BMEH by the Parent after the Closing Date by way of the
subscription for equity or other capital contribution in or to BMEH and not
funded by any existing funds of BMEH as at the Closing Date;
	 
	 	(e)	 	the Borrowers and the IDF Companies may maintain inter
company balances between themselves in an aggregate amount not exceeding
€2,000,000 at any time provided that the same are maintained on arms’ length
commercial terms in the ordinary course of business;
	 
	 	(f)	 	each of the loans referred to in Clause 16.3.5(i)
(Indebtedness) may be made;
	 
	 	(g)	 	[intentionally omitted;]




73









 






	 	(h)	 	the BMEH IBM Guarantees are hereby permitted; and
	 
	 	(i)	 	the BMEH Reichl Guarantee is hereby permitted;






	 	 	Transactions with Affiliates






	 	16.3.8	 	save to the extent permitted by the foregoing sub clauses of this Clause 16.3
(Negative Covenants), it will not, and will ensure that no Group Company will:






	 	(a)	 	sell, transfer, distribute or pay any money or assets to
any Affiliate (other than sales of US Inventory by BMUK to the USD Co and
subsequent sales of US Inventory by the USD Co back to BMUK immediately
prior to BMUK selling such US Inventory to its customers pursuant to the
terms of the Inter Company Sale Agreement);
	 
	 	(b)	 	lend or advance money or assets to any Affiliate; or
	 
	 	(c)	 	invest in (by capital contribution or otherwise) or
purchase or repurchase any shares or indebtedness or any assets of any
Affiliate,






	 	 	 	save that, if no Default has occurred and is continuing, a Group Company may
engage in transactions relating to the sale and purchase of Inventory (but not,
save as otherwise permitted in this Agreement, involving any sales of Equipment
or other fixed assets) with an Affiliate in the ordinary course of trading in
amounts and upon terms fully disclosed to the Agent in the Management Accounts
and no less favourable to that Group Company than would obtain in a comparable
arm’s length transaction with a third party which is not an Affiliate, provided
that Accounts generated between the Group Companies and their Affiliates shall
not account for more than three per cent (3%) of the total number of Accounts
generated by the Borrowers and/or any other Charging Companies;






	 	 	Change of business or operations






	 	16.3.9	 	it will ensure that there is no material change in the nature of its business or
operations or the business or operations of the Group taken as a whole (whether by a
single transaction or a number of related or unrelated transactions, whether at one
time or over a period of time and whether by disposal, acquisition or otherwise);






	 	 	Accounting reference date






	 	16.3.10	 	it will not, without the prior approval of the Agent, change, and will procure
that no other Group Company changes, its accounting reference date;






	 	 	Subsidiaries






	 	16.3.11	 	save pursuant to any Pre-Approved Acquisition or otherwise with the Agent’s prior
written consent, it will not, directly or indirectly, organise or acquire any
Subsidiary (other than a Dormant Company or those in existence as at the date of this
Agreement and which have been advised to the Agent in writing);






	 	 	Restricted Investments






	 	16.3.12	 	it will not, and will ensure that no Group Company will make any Restricted
Investment;




74









 












	 	 	Capital Expenditure






	 	16.3.13	 	it will not, and will ensure that no Group Company will, without the prior written
consent of the Agent, make or incur any Capital Expenditure if, after giving effect
thereto, the aggregate amount of all Capital Expenditure by the Group in any
Financial Year would exceed £1,500,000 (or the equivalent in any other currency);






	 	 	Lease or similar obligations






	 	16.3.14	 	save with the prior written consent of the Agent and save for any finance leases
agreed with the Agent pursuant to Clause 16.3.5 (Indebtedness), it will not, and will
ensure that no Group Company will enter into any lease of real or personal property
as lessee or sub-lessee or enter into any hire purchase, conditional sale or other
similar arrangement if, after giving effect thereto, the aggregate amount of Rentals
payable by the Group Companies in any Financial Year in respect of such lease and all
other such leases, hire purchase, conditional sale or similar arrangements would
exceed £500,000. The term “Rentals” means all payments due from the lessee or
sub-lessee under a lease or all payments, liabilities or obligations due from the
hirer or other relevant obligor or debtor (howsoever described) under any hire
purchase, conditional sale or similar arrangement, including, without limitation,
rent, service charge, utility or maintenance costs and insurance premiums together
with any VAT thereon;






	 	 	Capital Markets






	 	16.3.15	 	if any Borrower, BMEP, BMEH or BMEBV or any other Group Company shall enter into
any Capital Markets Transaction then, subject to the following provisions of this
Clause 16.3.15 (Capital Markets), it shall apply, or BMEH shall procure that there is
applied, thirty per cent (30%) of the net proceeds of such Capital Markets
Transaction to prepay (subject to payment of any broken funding costs) a commensurate
amount of the then Total Outstandings, provided that, if the average Excess
Availability during the period of six (6) months ending on the date upon which the
Capital Markets Transaction is completed was in excess of £5,000,000, then the
relevant issuer(s) shall not be obliged to apply such proceeds in prepayment in the
manner prescribed by this Clause 16.3.15 (Capital Markets);






	 	 	Vendor Financing






	 	16.3.16	 	it will not and will procure that no other Group Company will enter into any
vendor financing programme or similar arrangement for financing the acquisition of
Equipment, any other fixed asset or Inventory (which has not already been disclosed
in its budget for Capital Expenditure and approved by the Agent), without the prior
written consent of the Agent and without the Agent being provided with such
information as it may require as to the terms and conditions of such vendor financing
programme or other arrangement and assessing the impact, if any, upon the Collateral
and/or the encumbrances created by the Debenture;






	 	 	USD Co






	 	16.3.17	 	without prejudice to the terms of any other Finance Document, it will procure that
the USD Co will not (and the USD Co undertakes that it shall not) and, in relation to
Clause 16.3.17(p) only, BMUK undertakes that it will not:






	 	(a)	 	except as provided for in the Inter Company Sale
Agreement, sell, assign, convey, transfer or otherwise dispose of any US
Inventory or any other asset;




75









 






	 	(b)	 	cancel, terminate, amend, modify or waive any term or
condition of the Inter Company Sale Agreement or any other Finance Document
to which it is a party or any document entered into by it thereunder;
	 
	 	(c)	 	create or permit to subsist any encumbrance over all or
any of its assets other than in favour of the Security Trustee;
	 
	 	(d)	 	amend its accounting policies, except as may be required
by Applicable GAAP;
	 
	 	(e)	 	take any action which may prejudice the validity of the
Inter Company Sale Agreement or any other Finance Document to which it is a
party;
	 
	 	(f)	 	incur or permit to subsist any indebtedness of any kind
other than pursuant to the Inter Company Sale Agreement;
	 
	 	(g)	 	merge or consolidate with any other company or person;
	 
	 	(h)	 	except as contemplated by the Inter Company Sale
Agreement, sell, transfer or otherwise, dispose of or cease to exercise
direct control over any part of its present or future undertaking, assets,
rights or revenues whether by one or a series of transactions related or
not;
	 
	 	(i)	 	make any loans grant any credit or give any guarantee to
or for the benefit of any person;
	 
	 	(j)	 	engage in any business or activity other than those
necessary or incidental to the requirements of the Inter Company Sale
Agreement;
	 
	 	(k)	 	allot, issue or purchase any shares or alter any of the
rights attaching to its shares currently in issue;
	 
	 	(l)	 	declare or pay any dividend or make any other
Distribution (whether in cash or in specie) in respect of its share capital;
	 
	 	(m)	 	have any employees;
	 
	 	(n)	 	make or agree to make any payment to any person otherwise
than in accordance with the terms of the Inter Company Sale Agreement;
	 
	 	(o)	 	own, rent, lease or be in possession of any buildings or
equipment;
	 
	 	(p)	 	in relation to BMUK in its capacity as sole shareholder
of the USD Co, not petition or commence proceedings for the administration
or winding up (nor participate in any ex parte proceedings with regard
thereto, seek to enforce a judgment against the USD Co with regard thereto,
nor join any person in the petition or commencement of proceedings for the
administration or winding up) of the USD Co, nor to convene a meeting for
the purposes of considering a resolution or other steps taken by USD Co for
the winding up, dissolution, administration or reorganisation of USD Co,
other than for the purposes of a solvent reorganisation which has been
approved in writing in advance by the Agent;
	 
	 	(q)	 	permit to subsist any Subsidiary and it will not form or
acquire any Subsidiary;




76









 












	 	 	Material Contracts and terms of business






	 	16.3.18	 	it will not and will procure that none of the Trading Companies shall, without the
prior written consent of the Agent:






	 	(a)	 	amend in any material respect or terminate any of the
Material Contracts or its terms of business with Account Debtors, for which
purpose an amendment shall be regarded as “material” if it could reasonably
be expected to have a materially adverse effect on the interests of the
Lenders or the Receivables Purchaser; or
	 
	 	(b)	 	agree to waive any material or persistent breach of any
of the Material Contracts.






	 	 	Covenants relating to the Collateral
	 
	16.4	 	BMUK (and, in the case of Clause 16.4.16 (USDCo) only, BMEH) undertakes that:
	 
	 	 	Collateral Reporting






	 	16.4.1	 	it will provide the Agent, in each case in respect of each Trading Company, and on
a consolidated and consolidating basis, with the following documents at the following
times in form satisfactory to the Agent:






	 	(a)	 	on a weekly basis on each Wednesday based on figures as
of the previous Friday, a Borrowing Base Certificate incorporating, inter
alia, a schedule of credit notes, a summary of collections of accounts
receivable, a schedule of Accounts created since the last such schedule,
with effect from any Inventory Eligibility Date, a report of the Inventory
balance (by location) based on the perpetual inventory reports and such
further details as the Agent may request;
	 
	 	(b)	 	upon request, copies of invoices, credit notes, shipping
and delivery documents;
	 
	 	(c)	 	monthly ageings of accounts receivable to be delivered no
later than the 10th day of each month in respect of the immediately
preceding month;
	 
	 	(d)	 	monthly perpetual inventory reports by category to be
delivered no later than the 10th day of each month in respect of the
immediately preceding month;
	 
	 	(e)	 	on a monthly basis, a report listing the top ten (10)
customers of BMUK during that month, providing (i) details of the level of
sales made to each such customer; (ii) details of any credit notes issued to
each such customer or any other account adjustments made in respect of such
customer; and (iii) the amount of cash actually received from each such
customer during the relevant month;
	 
	 	(f)	 	with effect from any Inventory Eligibility Date, upon
request, monthly perpetual inventory reports with effect from any Inventory
Eligibility Date, a quarterly report of all Inventory based on a physical
stock count;
	 
	 	(g)	 	monthly ageings of accounts payable no later than the
10th day of the following month, together with a specific breakdown (in
reasonable detail) of the monthly ageings of accounts payable to the largest
ten supplier




77









 






	 	 	 	creditors of BMUK and details of the Inventory held by BMUK in respect
of such accounts payable and each such supplier;
	 
	 	(h)	 	with effect from any Inventory Eligibility Date, upon
request, copies of purchase orders, invoices, and delivery documents for
Inventory and Equipment acquired by that Trading Company;
	 
	 	(i)	 	such other reports as to the Collateral and the Accounts
(and each Borrower hereby authorises the Agent to make enquiries of its
customers in this respect) as the Agent shall request from time to time; and
	 
	 	(j)	 	certificates of an officer of BMUK certifying as to the
foregoing;






	 	 	Inspection






	 	16.4.2	 	upon receiving not more than two business days’ notice from the Agent (or without
notice following a Default which is continuing), it will, and will procure that each
Trading Company will, permit the Agent or any person authorised by the Agent to have
access to its premises to carry out a periodic inspection of the Collateral, the
regularity of such periodic inspections to be at the Agent’s discretion, but
initially to be no more often than every 60 days;






	 	 	Accounts






	 	16.4.3	 	it will not, and will ensure that no Trading Company will, re-date any invoice or
sale or make sales on extended credit beyond 45 days from its standard credit terms
or modify any Account except with the prior written consent of the Agent. If BMUK or
any other Obligor becomes aware of any material matter affecting any material Account
(including information regarding any Account Debtor’s creditworthiness and any
information in respect of an Account Debtor against whom a Trading Company has
commenced, or is proposing to commence, legal proceedings), it will promptly so
advise the Agent;






	 	 	Acceptance of notes or other instruments






	 	16.4.4	 	it will not, and will ensure that no Trading Company will, accept any note or other
instrument (except a cheque or other instrument for the immediate payment of money)
with respect to any Account without the Agent’s written consent. If the Agent
consents to the acceptance of any such note or other instrument, it shall be
considered as evidence of the Account and not payment thereof, and BMUK will promptly
deliver such note or instrument to the Agent appropriately endorsed. Regardless of
the form of presentment, demand, notice of dishonour, protest and notice of protest
with respect thereto, BMUK will remain liable thereon until such note or instrument
is paid in full;






	 	 	Disputes with Account Debtors






	 	16.4.5	 	it will notify the Agent promptly of all disputes and claims with Account Debtors
in excess of £50,000 and settle or adjust them, or ensure that the relevant Trading
Company settles or adjusts them, at no expense to the Lenders, but no discount,
credit or allowance shall be granted to any Account Debtor without the Agent’s
consent, except for discounts, credits and allowances made or given in the ordinary
course of trading when no Event of Default exists hereunder. BMUK shall send, or
procure that there is sent to, the Agent a copy of each credit note in excess of
£1,000,000 as soon as issued and a list of all credit notes in excess of £750,000 on
a weekly basis, with copies of any such credit notes to be supplied to the Agent at
the Agent’s request;




78









 












	 	 	Returns of Inventory






	 	16.4.6	 	if after the Inventory Eligibility Date, an Account Debtor returns any Inventory to
any Borrower or any Trading Company when no Event of Default exists, then that
Borrower shall promptly determine the reason for such return and shall issue, or
procure that the relevant Trading Company shall issue, a credit note to the Account
Debtor in the appropriate amount. Each Borrower shall immediately report to the
Agent any return involving an amount in excess of £1,000,000. Each such report shall
indicate the reasons for the returns and the locations and condition of the returned
Inventory. Whenever any Inventory is returned, the related Account shall be deemed
ineligible, and the Available Revolving Facility Amount shall be adjusted
accordingly;






	 	 	Inventory






	 	16.4.7	 	after the Inventory Eligibility Date, it will not, and will ensure that no Trading
Company will, without prior written notice to the Agent, acquire or accept any
Inventory on consignment or approval;






	 	 	Inventory — Reporting System






	 	16.4.8	 	after the Inventory Eligibility Date, it will maintain, and will ensure that each
Trading Company maintains, a perpetual inventory reporting system at all times; it
will conduct a physical count of the Inventory of all the Trading Companies at least
once per Financial Year and after the occurrence of an Event of Default at such other
times as the Agent requests, and shall promptly, upon completion, supply the Agent
with a copy of such count accompanied by a report of the value of such Inventory
(valued at the lower of cost, on a FIFO basis, or market value); no Borrower will,
and will ensure that no Trading Company will, without the Agent’s prior written
consent, sell any Inventory on a sale or return, sale on approval, consignment or
other repurchase or return basis;






	 	 	Condition of the Equipment






	 	16.4.9	 	it will keep and maintain, and will ensure that each Trading Company keeps and
maintains, its Equipment in good operating condition and repair (ordinary wear and
tear excepted) and will make all necessary replacements;






	 	 	Additions to the Equipment






	 	16.4.10	 	it will include information regarding any material additions to or deletions from
any Equipment (which, in the case of any additions, are to be within the agreed
Capital Expenditure budget) within the Management Accounts required to be delivered
pursuant to Clause 15.2.2 (Management Accounts);






	 	 	Disposal of the Equipment






	 	16.4.11	 	it will not, and will ensure that no Trading Company will, without the Agent’s
prior written consent, sell, lease as a lessor, or otherwise dispose of any Equipment
provided that obsolete or unusable Equipment having an orderly liquidation value no
greater than £500,000 individually and £1,500,000 in the aggregate in any Financial
Year, may be disposed of without the Agent’s consent, subject to the conditions set
forth below. If any of the Equipment is sold, transferred or otherwise disposed of
with the Agent’s prior written consent or as otherwise permitted hereby then:




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	 	(a)	 	if such sale, transfer or disposal is effected without
replacement of such Equipment, or such Equipment is replaced by leased
Equipment, or by Equipment purchased subject to a Permitted Encumbrance,
BMUK will, or will procure that the relevant Trading Company will, deliver
all of the cash proceeds of any such sale, transfer or disposal to the
Agent, which proceeds shall be applied in or towards prepayment of all sums
due from the Borrowers hereunder; or
	 
	 	(b)	 	if such sale, transfer or disposal is made in connection
with the purchase of replacement Equipment (other than subject to a
Permitted Encumbrance), BMUK will use the proceeds of such sale, transfer or
disposal to finance the purchase of such replacement Equipment which shall
be free and clear of all liens, claims and encumbrances, except for the
Security Interest and other Permitted Encumbrances and shall deliver to the
Agent written evidence of the use of the proceeds for such purchase;






	16.4.12	 	[intentionally omitted];
	 
	16.4.13	 	[intentionally omitted];






	 	 	St. Crispin Mortgage






	 	16.4.14	 	it will not agree to or complete any refinancing of the indebtedness relating to
the St. Crispin Property unless:






	 	(a)	 	the Agent shall be afforded a reasonable opportunity
(subject to any applicable confidentiality constraints) to review the terms
and conditions of such refinancing; and
	 
	 	(b)	 	BMUK shall procure that the St. Crispin Mortgagee shall
enter into an intercreditor deed or priority arrangement mutually acceptable
to the relevant St. Crispin Mortgagee, BMUK and the Agent;






	 	 	St. Crispin Property Guarantee






	 	16.4.15	 	it will not give and will procure that no other Group Company shall provide any
guarantee, indemnity or other assurance in respect of the obligations of BMUK or any
relevant Affiliate to the St. Crispin Mortgagee unless the obligations of each
relevant Group Company and the rights and recourse of the St. Crispin Mortgagee are
fully subordinated to the rights of the Beneficiaries under the Finance Documents;






	 	 	USD Co






	 	16.4.16	 	it will (a) procure that no Group Company or member of the Restricted Group will
take any action or omit to take any action which has the effect of the USD Co
becoming liable for any amount or incurring any liability or expense to any person
save for any action to be taken, or permitted to be taken, under or pursuant to the
Inter Company Sale Agreement and (b) pay to the USD Co an amount equal to any amount
for which the USD Co becomes liable notwithstanding Clause 16.4.16(a) immediately
upon the USD Co becoming so liable or to make such arrangements as are acceptable to
the Agent for the immediate discharge of such liability.






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	17.	 	DEFAULT
	 
	 	 	Events of Default
	 
	17.1	 	Each of the events set out below is an Event of Default:
	 
	 	 	Non-payment






	 	17.1.1	 	any Obligor or any IDF Company does not pay any sum due from it under any Finance
Document at the time and in the manner specified in the relevant Finance Document, or
where the non-payment results solely from technical difficulties relating to the
transfer of that amount from the relevant Obligor or IDF Company to the Agent or, as
the case may be, the Receivables Purchaser, within five (5) days of the due date;






	 	 	 Breach of representation or warranty






	 	17.1.2	 	any representation or warranty made or deemed to be repeated by any Obligor or any
IDF Company in any Finance Document or in any document delivered pursuant to it is
not complied with or is or proves to have been incorrect or misleading in any
material respect when made or deemed to be repeated;






	 	 	 Breach of undertaking






	 	17.1.3	 	any Borrower fails duly to perform or comply with any obligation expressed to be
assumed by it in Clause 2.2 (Purpose), 15 (Financial Condition), 16.2.8 (Hedging),
16.3 (Negative Covenants) or 16.4 (Covenants relating to the Collateral) or any
Obligor or any IDF Company fails duly to perform any obligation in, or comply with
any of the terms of, any of the Security Documents;






	 	 	 Breach of other obligation






	 	17.1.4	 	any Obligor or any IDF Company fails duly to perform or comply with any other
obligation expressed to be assumed by it in any of the Finance Documents and such
failure (if capable of remedy) is not remedied within ten business days after the
earlier of (i) the date upon which any such Obligor or, as the case may be, IDF
Company becomes aware of such default or (ii) the date upon which the Agent or, as
the case may be, Receivables Purchaser has notified such Obligor or, as the case may
be, IDF Company of such default or if any such Finance Document shall terminate
(other than in accordance with its terms or with the written consent of the Agent) or
become void or unenforceable;






	 	 	 Cross-default






	 	17.1.5	 	any indebtedness (other than indebtedness to any one or more trade creditors
arising in the ordinary course of business which is not overdue by more than 60 days
and in respect of which the relevant trade creditor has not sought repayment or
otherwise taken steps to procure or enforce repayment or in respect of which
repayment has been sought and the relevant Obligor or, as the case may be, IDF
Company is contesting in good faith by appropriate means its liability to make
payment thereof) of any Obligor or any IDF Company of an amount in excess of
£1,000,000 (or its equivalent in any other currency) is not paid when due or is
declared to be or otherwise becomes due and payable prior to its specified maturity
or any creditor of any Obligor or any IDF Company becomes entitled to declare any
such indebtedness due and payable prior to its specified maturity;




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	 	 	 Insolvency






	 	17.1.6	 	any Obligor or Group Company is unable to pay its debts as they fall due (or is
deemed by law or by a court to be unable to pay its debts), stops, suspends or
threatens to stop or suspend payment of all or any part of its indebtedness or
commences negotiations with any one or more of its creditors with a view to the
general readjustment or re-scheduling of all or any part of its indebtedness or makes
a general assignment for the benefit of, or composition with, its creditors or a
moratorium is agreed or declared in respect of, or affecting, all or any part of its
indebtedness;






	 	 	 Enforcement proceedings






	 	17.1.7	 	a distress, attachment, execution, diligence or other legal process is levied,
enforced or sued out on or against all or any part of the assets of any Obligor or
Group Company and is not discharged within five business days;






	 	 	 Insolvency proceedings






	 	17.1.8	 	any Obligor or Group Company takes any corporate action or other steps are taken or
legal or other proceedings are started for:






	 	(a)	 	its winding-up, administration, dissolution, receivership
or re-organisation other than (i) a winding-up for the purposes of a bona
fide, solvent scheme of reconstruction or amalgamation previously approved
in writing by the Agent or (ii) a petition for winding up which a Borrower
has satisfied the Agent is vexatious, groundless or an abuse of process and
in relation to which the relevant Group Company has taken steps within seven
days of the petition to restrain the petitioner from advertising the
petition and which in any event has been discharged within 30 days of the
petition; or
	 
	 	(b)	 	the appointment of a receiver, administrator,
administrative receiver, trustee or similar officer of it or of any or all
of its assets;






	 	 	 Analogous proceedings






	 	17.1.9	 	anything analogous to or having a substantially similar effect to any of the events
specified in Clauses 17.1.6 (Insolvency), 17.1.7 (Enforcement proceedings) or 17.1.8
(Insolvency proceedings) shall occur under the laws of any applicable jurisdiction;






	 	 	 Encumbrance enforceable






	 	17.1.10	 	any encumbrance on or over the assets of any Obligor or Group Company securing
indebtedness in excess of £500,000 becomes enforceable and any step (including the
taking of possession or the appointment of a receiver, manager or similar person) is
taken to enforce that encumbrance;






	 	 	 Expropriation






	 	17.1.11	 	all or any material part of the shares or assets of any Obligor is seized,
compulsorily acquired, nationalised or otherwise expropriated or custody or control
of the same is assumed by any public authority or any court of competent jurisdiction
at the instance of any public authority, except where contested in good faith by
proper proceedings diligently pursued where a stay of enforcement is in effect;




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	 	 	 Termination of any guarantee






	 	17.1.12	 	any guarantee of any amounts due and payable under any of the Finance Documents
shall be terminated, revoked or declared void or invalid;






	 	 	 Judgments






	 	17.1.13	 	one or more final judgments for the payment of money aggregating in excess of
£50,000 (whether or not covered by insurance) shall be rendered against any Obligor
and such Obligor shall fail to discharge the same within thirty (30) days from the
date of entry thereof or to appeal therefrom;






	 	 	 Loss of Collateral






	 	17.1.14	 	any loss, theft, damage or destruction of any item or items of the Collateral
occurs which in the opinion of the Agent (i) could materially and adversely affect
the operation of any Borrower’s or any Obligor’s business or the business of the
Group (taken as a whole) or (ii) is material in amount and is not adequately covered
by insurance;






	 	 	 Cessation of business






	 	17.1.15	 	any Obligor ceases to carry on the business it carries on today or enters into any
unrelated business;






	 	 	 Illegality






	 	17.1.16	 	it is or will become unlawful for any Obligor to perform or comply with any of its
obligations under any Relevant Agreement, or any such obligation is not or ceases to
be legal, valid and binding;






	 	 	 Repudiation






	 	17.1.17	 	any Obligor repudiates, or does or causes to be done anything evidencing an
intention to repudiate any Relevant Agreement;






	 	 	 Loss of a material number of customers






	 	17.1.18	 	if, on receipt by the Agent of a Quarterly Sales Certificate in accordance with
Clause 15.2.7 (Quarterly Sales Certificates), that Quarterly Sales Certificate
demonstrates that the result of the formula specified below is less than 0.75.
	 
	 	 	 	A -C
  
B
	 
	 	 	 	Where:
	 
	 	 	 	“A” is the Total Year 1 Sales specified in that Quarterly Sales Certificate;
	 
	 	 	 	“B” is the Total Year 2 Sales specified in that Quarterly Sales Certificate; and
	 
	 	 	 	“C” is the Total Lost Customer Sales specified in that Quarterly Sales
Certificate
	 
	 	 	 	Expressions used in this Clause 17.1.18 (Loss of a material number of customers)
have the meanings given to them in Clause 15.2.7 (Quarterly Sales Certificates);




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	 	 	 Loss of a material number of suppliers






	 	17.1.19	 	if, on receipt by the Agent of a Quarterly Supply Certificate in accordance with
Clause 15.2.8 (Quarterly Supply Certificates), that Quarterly Supply Certificate
demonstrates that the result of the formula specified below is less than 0.65.
	 
	 	 	 	X -Z
  
Y
	 
	 	 	 	Where:
	 
	 	 	 	“X” is the Total Year 1 Supply Costs specified in that Quarterly Supply
Certificate;
	 
	 	 	 	“Y” is the Total Year 2 Supply Costs specified in that Quarterly Supply
Certificate; and
	 
	 	 	 	“Z” is the Total Reduced Supply Costs specified in that Quarterly Supply
Certificate.
	 
	 	 	 	Expressions used in this Clause 17.1.19 (Loss of a material number of suppliers)
have the meanings given to them in Clause 15.2.8 (Quarterly Supply Certificates);






	 	 	 Change of control






	 	17.1.20	 	any person or group of connected persons which does not have control at the date
of this Agreement acquires control of BMEH, BMEP, BMEBV or any Obligor and for this
purpose “connected person” shall be construed in accordance with section 839 Income
and Corporation Taxes Act 1988;






	 	 	 Invoice Discounting Agreements






	 	17.1.21	 	any Event of Default as defined in and referred to in the Accounts Transfer
Conditions (other than an Event of Default set out in Condition 17.1(i) (Encumbrance
Enforceable) or Condition 17.1(l) (Judgments) of the Accounts Transfer Conditions)
shall occur;






	 	 	 Action by any IBM Entity pursuant to the BMEH IBM Guarantees






	 	17.1.22	 	any demand, notice of demand for payment and/or fulfilment of obligations is
served on BMEH under any BMEH IBM Guarantee or any other action or claim is
threatened or made or proceedings are commenced against BMEH under or pursuant to any
BMEH IBM Guarantee;






	 	 	 Action by Mr Klaus Reichl pursuant to the BMEH Reichl Guarantee






	 	17.1.23	 	any demand, notice of demand for payment and/or fulfilment of obligations is
served on BMEH under the BMEH Reichl Guarantee or any other action or claim is
threatened or made or proceedings are commenced against BMEH under or pursuant to the
BMEH Reichl Guarantee.






	 	 	Acceleration
	 
	17.2	 	If at any time and for any reason (and whether within or beyond the control of any party to
any of the Finance Documents) any Event of Default has occurred, then at any time thereafter,
whilst such Event of Default is continuing, the Agent may, and shall, if so instructed by the




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	 	 	Majority Lenders, by written notice to BMUK do one or more of the following at any time or
times and in any order:






	 	17.2.1	 	reduce or cancel the Available Facility or any one or more of its elements or
reduce or cancel the Available Revolving Facility Amount;
	 
	 	17.2.2	 	restrict the amount of or refuse to make available any Revolving Loan or Swingline
Loan or to issue any Letter of Credit or Guarantee;
	 
	 	17.2.3	 	terminate this Agreement and the Revolving Facility made or to be made available
hereunder and cancel any Bank Products;
	 
	 	17.2.4	 	declare any Revolving Loan or any Swingline Loan, all unpaid accrued interest or
fees and any other sum then payable under this Agreement to be due and payable on
demand or on such date as it may specify in such notice whereupon all such moneys
shall become so due and payable on demand or on such date (as the case may be);
	 
	 	17.2.5	 	require that the Borrower deposit with the Security Trustee with respect to any
Letter of Credit or Guarantee then outstanding and/or with respect to any Bank
Product Debt, a Supporting Letter of Credit or cash, in the same manner as
contemplated in Clause 6.14 (Supporting Letter of Credit; Cash Collateral);
	 
	 	17.2.6	 	declare the Revolving Facility to be cancelled, whereupon it shall be so cancelled
and the Commitment of each Lender shall immediately be reduced to zero;
	 
	 	17.2.7	 	enforce any or all of its rights or require that the Security Trustee enforce any
or all of its rights under any of the Finance Documents or under applicable law.






	 	 	On Demand Facility
	 
	17.3	 	If, pursuant to Clause 17.2.4, the Agent declares any of the Loans (or any other moneys which
may become payable hereunder) to be due and payable on demand of the Agent, then, at any time
thereafter, the Agent may by written notice to BMUK call for repayment of any such Loans (and
any other such moneys) on such date as it may specify in such notice (whereupon the same shall
become due and payable on such date together with all unpaid accrued interest, fees and any
other sums then owed by the Borrowers hereunder) or withdraw its declaration with effect from
such date as it may specify in such notice.
	 
	 	 	Letter of Credit and Guarantee Fee following Event of Default
	 
	17.4	 	From the date of the occurrence of any Event of Default until such Event of Default is
remedied to the satisfaction of the Agent, or until all sums payable hereunder have been
satisfied or discharged in full and none of the Lenders is under any contingent liability
hereunder or under any Letter of Credit or Guarantee, the Letter of Credit and Guarantee Fee
shall be calculated at the rate per annum equal to an additional 2% per annum to that referred
to in Clause 22.5 (Letter of Credit and Guarantee Fee) on the maximum face value of any Letter
of Credit or maximum contingent liability of the Issuer under each Guarantee then outstanding.
	 
	 	 	Termination Fee
	 
	17.5	 	If the Agent terminates this Agreement upon an Event of Default, BMUK shall pay the Agent for
the account of the Lenders in their Participating Proportions, immediately upon termination, a
fee equal to the early termination fee that would have been payable under Clause 29 (Term and
Termination) if this Agreement had been terminated on that date pursuant to BMUK’s election.




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	18.	 	DEFAULT INTEREST
	 
	 	 	Interest on Unpaid Sums
	 
	18.1	 	If any relevant Obligor does not pay any sum payable by it under this Agreement on its due
date in accordance with the provisions of Clause 20 (Payments) or if any sum due and payable
by any relevant Obligor under any judgment of any court in connection with this Agreement is
not paid on the date of such judgment, it shall pay interest on the balance for the time being
outstanding (such balance being referred to in this Agreement as the “unpaid sum”) for the
period beginning on such due date or, as the case may be, the date of such judgment, in
accordance with the provisions of this Clause 18 (Interest on Unpaid Sums).
	 
	 	 	Default Interest Periods
	 
	18.2	 	Interest under this Clause 18 (Default Interest) shall be calculated by reference to
successive periods, each of which (other than the first, which shall begin on the due date for
payment or, as the case may be, the date of judgment as referred to in Clause 18.1 (Interest
on Unpaid Sums)) shall begin on the last day of the preceding period. Each such period shall
be of such duration as the Agent may select.
	 
	 	 	Default Interest Rates
	 
	18.3	 	The rate of interest applicable to an unpaid sum from time to time during each period
relating to that unpaid sum shall be the rate per annum which is the sum of (i) two per cent
(2%) (ii) the Applicable Margin (iii) LIBOR relative to such period (or, in respect of any
Swingline Loans or Reference Rate Revolving Loans, the Reference Rate) and (iv) the Mandatory
Cost, if any, applicable to that unpaid sum provided that:






	 	18.3.1	 	if, at or about 11.00 a.m. on the Quotation Date in respect of such unpaid sum, it
is not possible to determine LIBOR in accordance with the definition of LIBOR there
shall be substituted for LIBOR the rate determined by the Agent (and notified to
BMUK) to be the weighted average of the rates (as notified to the Agent by the
Lenders prior to the first day of the relevant Interest Period) which represent the
cost to each Lender of funding its portion of such unpaid sum during such period from
whatever sources and in whatever manner it may select; and
	 
	 	18.3.2	 	if the unpaid sum is of the principal amount of a LIBOR Revolving Loan which became
due and payable other than on the last day of any Interest Period relating to it, the
first default period applicable to that unpaid sum shall be of a duration equal to
the unexpired portion of that Interest Period and the rate of interest applicable to
it during that Interest Period shall be the rate per annum equal to the sum of two
per cent (2%) and the rate applicable to it immediately before it became due.






	 	 	Payment and Compounding of Default Interest
	 
	18.4	 	Any interest accrued due under Clause 18.3 (Default Interest Rates) in respect of an unpaid
sum shall be due and payable and shall be paid by the relevant Obligor at the end of the
period by reference to which it is calculated or on such other date as the Agent may specify
by written notice to BMUK. If not paid on the due date, the interest shall be added to and
form part of the unpaid sum on which interest shall accrue and be payable in accordance with
the provisions of this Clause 18 (Default Interest).




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	19.	 	INDEMNITIES
	 
	 	 	General Indemnities
	 
	19.1	 	BMUK shall (or will procure that an Obligor will) indemnify on demand each of the
Beneficiaries against any funding or other cost, loss (including any foreign exchange contract
loss incurred by any of them), expense or liability which it may sustain or incur, directly or
indirectly, as a result of:






	 	19.1.1	 	a Loan not being made by reason of any of the provisions of Clause 6.1.1 (General
Conditions of Utilisation) or any of the conditions set out in Schedule 2 (Conditions
Precedent) not being satisfied or any Borrower cancelling or purporting to cancel a
Utilisation Notice; or
	 
	 	19.1.2	 	the occurrence of any Default; or
	 
	 	19.1.3	 	the receipt or recovery by it (or the Agent on its behalf) of all or any part of
its share of any Loan or unpaid sum other than on the last day of any Interest Period
relating to that Loan or unpaid sum.






	 	 	Break Costs
	 
	19.2	 	BMUK’s liability under Clause 19.1 (General Indemnities) shall include the amount (if any) by
which (i) the additional interest which would have been payable under this Agreement on the
amount so received or recovered had it been received or recovered by the relevant party on the
last day of the relevant Interest Period exceeds (ii) the amount of interest which, in the
opinion of the Beneficiary concerned, would have been payable to such Beneficiary on the last
day of that Interest Period in respect of a deposit denominated in the currency of the Loan or
unpaid sum in question equal to the amount so received or recovered placed by it with a prime
bank in London for a period starting on the second business day following the date of such
receipt or recovery and ending on the last day of that Interest Period. For the avoidance of
doubt (but without prejudice to their obligations to pay break costs), neither BMUK nor any
other relevant Obligor shall be liable to compensate any Beneficiary for any loss of
Applicable Margin if any amount is repaid, prepaid or cancelled by virtue of the operation of
Clauses 9.3 (Prepayment and Cancellation of Individual Lenders) or 12.1.2.(Consequences of
Illegality)
	 
	 	 	Currency Indemnity
	 
	19.3	 	Any amount received or recovered by any Beneficiary in respect of any sum expressed to be due
to it from any Obligor under any Finance Document in a currency other than the currency (the
“contractual currency”) in which such sum is so expressed to be due (whether as a result of,
or of the enforcement of, any judgment or order of a court or tribunal of any jurisdiction,
the winding-up of such Obligor or otherwise) shall only constitute a discharge to such Obligor
to the extent of the amount of the contractual currency that the recipient is able, in
accordance with its usual practice, to purchase with the amount of the currency so received or
recovered on the date of receipt or recovery (or, if later, the first date on which such
purchase is practicable). If the amount of the contractual currency so purchased is less than
the amount of the contractual currency so expressed to be due, such Obligor shall indemnify
the recipient against any loss sustained by it as a result, including the cost of making any
such purchase.
	 
	 	 	Indemnity to the Agent
	 
	19.4	 	BMUK shall (or shall procure that an Obligor shall) promptly indemnify the Agent against any
cost, loss or liability incurred by the Agent (other than any loss occasioned by the gross
negligence or wilful misconduct of the Agent) as a result of:




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	 	19.4.1	 	investigating any event which it reasonably believes is a Default; or
	 
	 	19.4.2	 	entering into or performing any foreign exchange contract for the purposes of any
Loan being made in a Foreign Currency; or
	 
	 	19.4.3	 	acting or relying on any notice, request or instruction which it believes to be
genuine, correct and appropriately authorised.






	 	 	Nature of Indemnities
	 
	19.5	 	Each of the indemnities in this Clause 19 (Indemnities) constitutes a separate and
independent obligation from the other obligations in this Agreement, shall give rise to a
separate and independent cause of action, shall apply irrespective of any time or indulgence
granted by the Agent or any Lender and shall continue in full force and effect notwithstanding
any order, judgment, claim or proof for a liquidated amount in respect of any sum due under
this Agreement or any other judgment or order.
	 
	20.	 	CURRENCY OF ACCOUNT AND PAYMENTS
	 
	 	 	Currency of Account and Payment
	 
	20.1	 	Sterling is the currency of account and payment for all sums at any time due from the
Borrower under or in connection with any of the Finance Documents (including damages) provided
that (i) each repayment of a Loan or a part thereof shall be made in the currency in which
such Loan is denominated at the time of that repayment; (ii) each payment of interest shall
be made in the currency in which the sum in respect of which such interest is payable is
denominated; (iii) each payment in respect of costs and expenses shall be made in the
currency in which the same were incurred; and (iv) any amount expected to be payable in a
currency other than sterling shall be paid in that other currency.
	 
	 	 	Payments by the Borrower and the Lenders
	 
	20.2	 	On each date on which this Agreement requires an amount to be paid by any Obligor or any of
the Lenders to the Agent, that Obligor or, as the case may be, such Lender shall make the same
available to the Agent:






	 	20.2.1	 	where such amount is denominated in sterling, by payment in sterling and in same
day funds (or in such other funds as may for the time being be customary in London
for the settlement in London of banking transactions in sterling) to the Agent at
Bank of America, N.A., 5 Canada Square, London, E14 5AQ, sort code 16-50-50, Attn:
Loans Service (or as the Agent may otherwise specify for this purpose); or
	 
	 	20.2.2	 	where such amount is denominated in a Foreign Currency (other than euro), by
payment in such Foreign Currency and in immediately available, freely transferable,
cleared funds to such account with such bank in the principal financial centre of the
country of such Foreign Currency as the Agent may specify for this purpose; or
	 
	 	20.2.3	 	where such amount is denominated in euro, such sum shall be made available to the
Agent by payment in euro and in immediately available, freely transferable, cleared
funds to such account with such bank in such principal financial centre in such
participating member state of the European Union or in London as the Agent shall from
time to time nominate for this purpose.




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	 	 	Payments by the Agent
	 
	20.3	 	Save as otherwise provided herein, each payment received by the Agent for the account of
another person pursuant to Clause 20.2 (Payments by the Borrowers and the Lenders) shall be
made available by the Agent (subject, without any liability therefor, for delays outside the
Agent’s control in crediting cleared funds) to such other person (in the case of a Lender, for
the account of its Facility Office) for value the same day (provided that such payment has
been received by the Agent by no later than 12.00 noon) by transfer to such account of such
person with such bank in the principal financial centre of the country of the currency of such
payment as such person shall have previously notified to the Agent or (in the case of a
Borrower) in the agreed currency denomination to the account of that Borrower specified in the
Utilisation Notice.
	 
	 	 	Payments due on non-business days
	 
	20.4	 	If any payment of principal, interest, premium or other sum to be made hereunder becomes due
and payable on a day other than a business day, the due date of payment shall be extended to
the next succeeding business day and interest thereon shall be payable at the applicable
interest rate during such extension (unless that next succeeding business day falls in the
following calendar month in which case the due date of payment shall be the immediately
preceding business day).
	 
	 	 	Impracticable to make payments
	 
	20.5	 	If, at any time, it shall become impracticable (by reason of any action of any governmental
authority or any change in law, exchange control regulations or any similar event) for any
Obligor to make any payments hereunder in the manner specified in Clause 20.2 (Payments by the
Borrowers and the Lenders), then that Obligor may agree with each or any of the Lenders to
make alternative arrangements for the payment direct to such Lender of amounts due to such
Lender hereunder provided that, in the absence of any such agreement with any Lender, that
Obligor shall be obliged to make all payments due to such Lender in the manner specified in
this Agreement. Upon reaching such agreement the relevant Obligor and such Lender shall
immediately notify the Agent and shall thereafter promptly notify the Agent of all payments
made direct to such Lender.
	 
	 	 	No Set-Off or Counterclaim
	 
	20.6	 	All payments made by an Obligor under this Agreement shall be made free and clear of and
without any deduction for or on account of any set-off or counterclaim.
	 
	 	 	Refunding of Payments
	 
	20.7	 	Where a sum is to be paid to the Agent under this Agreement for account of another person,
the Agent shall not be obliged to (but may) make the same available to that other person until
it has been able to establish to its satisfaction that it has actually received that sum. If
and to the extent that it does so but it proves to be the case that it had not actually
received the sum which it paid out, then, the person to whom the Agent made that sum available
shall on request refund it to the Agent and that person or (at the option of the Agent) the
person by whom that sum should have been made available shall on request pay to the Agent the
amount (as certified by the Agent) which will indemnify the Agent against any funding or other
cost, loss, expense or liability which it may have sustained or incurred as a result of paying
out that sum before receiving it.




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	 	 	Debit to Loan Account
	 
	20.8	 	The Agent is hereby authorised to debit all Swingline Loans and all Reference Rate Revolving
Loans and interest thereon to a loan account or accounts denominated in the currency
denomination of each such Loan maintained with the Agent. All fees, commissions, costs,
expenses and other charges under or pursuant to the Finance Documents and all payments made
and out-of-pocket expenses incurred by the Agent and/or the Lenders pursuant to the Finance
Documents will be debited to such loan account(s) as of the date due from the relevant
Borrower or the date paid or incurred by the Agent and/or the Lenders, as the case may be.
	 
	 	 	Change of Currency to Euro
	 
	20.9	 	With effect from the date (if any) upon which sterling is converted into euro in accordance
with EMU legislation:
	 
	 	 	Redenomination






	 	20.9.1	 	each obligation under this Agreement of any party to this Agreement which, up to
such time, had been denominated in sterling shall be redenominated into euro in
accordance with EMU legislation provided that, if and to the extent that any EMU
legislation provides that an amount denominated either in euro or in sterling as a
national currency unit of the euro can be paid by the debtor either in euro or in
that national currency unit, each party to this Agreement shall be entitled to pay or
repay any such amount either in euro or in sterling as such national currency unit;






	 	 	Rounding






	 	20.9.2	 	without prejudice and in addition to any method of conversion or rounding
prescribed by any EMU legislation and without prejudice to the respective liabilities
for indebtedness of any Obligor to the Beneficiaries and the Beneficiaries to any
Obligor under or pursuant to this Agreement each reference in this Agreement to a
minimum amount (or an integral multiple thereof) in sterling to be paid to or by the
Agent and/or the Lenders shall be replaced by a reference to such reasonably
comparable and convenient amount (or an integral multiple thereof) in euro as the
Agent (after consultation with BMUK but without prejudice to its rights under this
Clause 20.9.2 (Rounding)) may from time to time specify; and






	 	 	Consequential changes






	 	20.9.3	 	each provision of this Agreement shall be subject to such reasonable changes of
construction as the Agent may (after consultation with BMUK but without prejudice to
its rights under this Clause 20.9.3 (Consequential changes))from time to time specify
to be necessary or appropriate to reflect the changeover of sterling to euro.






	 	 	Order of Distribution






	20.10	 	If the amount received by the Agent from an Obligor (or, as the case may be, from the
Security Trustee pursuant to the exercise by the Security Trustee of any rights or powers it
may have pursuant to the Security Documents) on any date is less than the total sum due under
this Agreement on that date, the Agent shall apply that amount in or towards payment of the
following sums in the following order:






	 	20.10.1	 	first, in or towards payment of any sum then due to the Agent in its capacity as
such;




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	 	20.10.2	 	secondly, in or towards payment of any sum then due to the Arranger in its
capacity as such;
	 
	 	20.10.3	 	thirdly, in or towards payment pro rata of any sums (other than principal of or
interest on the Loans) then due to the Lenders (or any of them);
	 
	 	20.10.4	 	fourthly, in or towards payment pro rata of any interest then due;
	 
	 	20.10.5	 	fifthly, in or towards payment pro rata of any principal then due;
	 
	 	20.10.6	 	sixthly, in or towards payment to BofA in respect of any Bank Product Debt then
due but unpaid,






	 	 	and any such applications shall be made notwithstanding any purported appropriation to the
contrary by any person.
	 
	21.	 	SET-OFF
	 
	 	 	Each Obligor authorises any other party to this Agreement at any time after an Event of
Default has occurred and is continuing and without prior notice to that Obligor to apply
any credit balance (whether or not then due) to which that Obligor is at any time
beneficially entitled on any account at any office of that party in or towards
satisfaction of any sum then due from it to that party under this Agreement and unpaid and
for this purpose to purchase with the moneys standing to the credit of any such account
such other currencies as may be necessary to effect such application (but so that nothing
in this Clause 21 (Set-Off) shall be effective to create a charge). No party shall be
obliged to exercise any of its rights under this clause which shall be without prejudice
to and in addition to any right of set-off, combination of accounts, lien or other right
to which it is at any time otherwise entitled (whether by operation of law, contract or
otherwise).
	 
	22.	 	FEES
	 
	 	 	Unused Line Fee
	 
	22.1	 	For every month during the term of this Agreement, BMUK shall (or shall procure that another
Obligor shall) pay the Agent for the account of the Lenders a fee (the “Unused Line Fee”) in
an amount equal to 0.25% per annum, multiplied by the average daily amount by which the Total
Commitments (provided that for the purposes of this Clause 22.1 (Unused Line Fee) and
calculating the Unused Line Fee only, the Total Commitments shall be deemed to be £60,000,000
until such time as BMUK has served a notice in accordance with Clause 2.7 (Increase of Maximum
Revolving Credit Line) and the period referred to in such Clause 2.7 (Increase of Maximum
Revolving Credit Line) has expired after which time they shall be £76,000,000) exceed the sum
of the sterling equivalent of (i) the average daily outstanding amount of the Revolving Loans
and Swingline Loans during such month (with the outstanding amount of Revolving Loans and
Swingline Loans calculated for this purpose by applying payments immediately upon receipt),
(ii) the maximum contingent liability of the Issuer under each Letter of Credit and Guarantee
or, if any demand is made under any Letter of Credit or Guarantee, the average daily amount
outstanding under any account to which any such payment made thereunder is debited and (iii)
the Invoice Discounting Facility Exposure. Such fee shall be calculated on the basis of a
year of three hundred sixty five (365) days and actual days elapsed, and shall be payable to
the Agent on the first day of each month following the Closing Date and on the termination of
this Agreement, in each case with respect to the prior month or portion thereof.




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	 	 	Arrangement Fee
	 
	22.2	 	BMUK shall pay to the Arranger for its own account an arrangement fee in the amount and at
the times agreed in a Fee Letter dated on or around the Closing Date from the Arranger to
BMUK.
	 
	 	 	Collateral Management Fee
	 
	22.3	 	BMUK will pay the Agent for its own account a collateral management fee (the “Collateral
Management Fee”) of an amount set out in the Fee Letter (2008). The total amount of such fee
shall be deemed to have accrued due and become payable in full on the date referred to in the
Fee Letter (2008) but the Agent agrees, subject to Clause 29.3 (Effect of Termination), that
such fee shall be paid in equal instalments at the times specified in the Fee Letter (2008).
BMUK will also pay to the Agent for its own account such other fees as are referred to in the
Fee Letter (2008) in the amounts and at the times referred to in it.
	 
	 	 	Audit Fee
	 
	22.4	 	BMUK shall pay to the Agent for its own account an audit fee of £500 per day per field
examiner charge (the “Audit Fee”) in respect of the periodic inspection of the Collateral
required by the Agent in accordance with this Agreement and shall also pay on demand all out
of pocket expenses incurred by the Agent in connection with any such inspection.
	 
	 	 	Letter of Credit and Guarantee Fee
	 
	22.5	 	BMUK agrees to pay (or procure that the relevant Borrower shall pay) to the Agent for account
of the Issuer a fee (the “Letter of Credit and Guarantee Fee”) equal to 2.00% per annum of the
face amount of each Letter of Credit or maximum contingent liability under each Guarantee
issued by the Issuer, plus all out-of-pocket costs, fees and expenses incurred by the Issuer
(other than where such fees, costs or expenses are indemnified pursuant to Clause 6.12.2
(Indemnity)) in connection with the application for, issue of, or amendment to any Letter of
Credit or Guarantee, such Letter of Credit and Guarantee Fee to be calculated on the basis of
a year of 365 days and actual days elapsed and to be payable monthly in arrears on the first
day of each month following any month in which a Letter of Credit or Guarantee was issued
and/or in which a Letter of Credit or Guarantee remains outstanding and, to the extent that it
has been calculated by reference to a Letter of Credit or Guarantee denominated other than in
sterling, shall be satisfied by payment of the sterling equivalent of the amount so
calculated. Any out-of-pocket costs, fees and expenses incurred by the Issuer in connection
with the application for, issue of, or amendment to any Letter of Credit or Guarantee shall be
payable at the time of such application, issue or amendment.
	 
	 	 	Agency and Trustee Fees
	 
	22.6	 	BMUK shall pay to the Agent and the Security Trustee each for its own account the agency fees
or, as the case may be, the trustee fees specified in the Fee Letter (2008). The full amount
of such fees shall be deemed to have accrued due and become payable in full on the date
specified in the Fee Letter (2008) but the Agent and the Security Trustee each agree, subject
to Clause 29.3 (Effect of Termination), that such fees shall be paid in equal instalments as
set out in the Fee Letter (2008).
	 
	 	 	Additional Monitoring and Administration Fee
	 
	22.7	 	Without prejudice to any other rights that the Agent, the Security Trustee or any of the
Beneficiaries may have at such time under this Agreement or any other Finance Document, BMUK
agrees that, upon the appointment of a receiver, administrator, administrative receiver,




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	 	 	trustee, examiner or any other similar officer or office holder of any Obligor or of any
or all of the assets of any Obligor or upon an order being made for the winding-up,
liquidation or dissolution of any Obligor (the date of such event or occurrence being the
“Insolvency Date”), BMUK shall become liable to pay forthwith to the Agent for its own
account, an additional monitoring and administrative fee (the “Additional Monitoring and
Administration Fee”) in an amount equal to one per cent. (1%) of the higher of (a) the
aggregate total of all Accounts then due and owing from any Account Debtor to the
Borrowers (as determined by the Agent by reference to the most recent information provided
to it under Clause 15.2 (Provision of Financial Information) and Clause 16.4 (Covenants
relating to the Collateral)) and (b) the Total Commitments, in each case, as at the
Insolvency Date.


	 	 	Termination Fee
	 
	22.8	 	On the date on which the Loans are finally repaid and each Letter of Credit or Guarantee is
no longer outstanding, the Borrowers shall pay to the Agent, for the account of the applicable
Receivables Purchaser, a termination fee in an aggregate amount equal to the lesser of (a)
£10,000,000 and (b) each IDF Portfolio Loss.
	 
	23.	 	PRO RATA SHARING
	 
	 	 	Sharing Payments
	 
	23.1	 	If a Beneficiary (a “Recovering Beneficiary”) receives or recovers any amount from an Obligor
other than in accordance with Clause 20 (Payments) and applies that amount to a payment due
under the Finance Documents then:






	 	23.1.1	 	the Recovering Beneficiary shall, within three business days, notify details of the
receipt or recovery to the Agent;
	 
	 	23.1.2	 	the Agent shall determine whether the receipt or recovery is in excess of the
amount the Recovering Beneficiary would have been paid had the receipt or recovery
been received or made by the Agent and distributed in accordance with clause 20,
without taking account of any tax which would be imposed on the Agent in relation to
the receipt, recovery or distribution; and
	 
	 	23.1.3	 	the Recovering Beneficiary shall, within three business days of demand by the
Agent, pay to the Agent an amount (the “Sharing Payment”) equal to such receipt or
recovery, less any amount which the Agent determines may be retained by the
Recovering Beneficiary as its share of any payment to be made, in accordance with
Clause 20.10 (Order of Distribution) .






	 	 	Redistribution of payments
	 
	23.2	 	The Agent shall treat the Sharing Payment as if it had been paid by the relevant Obligor and
distribute it between the Beneficiaries (other than the Recovering Beneficiary) in accordance
with Clause 20.10 (Order of Distribution).
	 
	 	 	Recovering Beneficiary’s rights
	 
	23.3	 	 






	 	23.3.1	 	On a distribution by the Agent under Clause 23.2 (Redistribution of Payments) the
Recovering Beneficiary will be subrogated to the rights of the Beneficiaries which
have shared in the redistribution.




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	 	23.3.2	 	If and to the extent that the Recovering Beneficiary is not able to rely on its
rights under sub-clause 23.3.1 above, the relevant Obligor shall be liable to the
Recovering Beneficiary for a debt equal to the Sharing Payment which is immediately
due and payable.






	 	 	Reversal of redistribution
	 
	23.4	 	If any part of the Sharing Payment received or recovered by a Recovering Beneficiary becomes
repayable and is repaid by that Recovering Beneficiary, then:






	 	23.4.1	 	each Beneficiary which has received a share of the relevant Sharing Payment
pursuant to Clause 23.2 (Redistribution of Payments) shall, upon request of the
Agent, pay to the Agent for account of that Recovering Beneficiary an amount equal to
the appropriate part of its share of the Sharing Payment (together with an amount as
is necessary to reimburse that Recovering Beneficiary for its proportion of any
interest on the Sharing Payment which that Recovering Beneficiary is required to
pay); and
	 
	 	23.4.2	 	that Recovering Beneficiary’s rights of subrogation in respect of any reimbursement
shall be cancelled and the relevant Obligor will be liable to the reimbursing
Beneficiary for the amount so reimbursed.






	 	 	Exceptions
	 
	23.5	 	This Clause 23 (Pro Rata Sharing) shall not apply to the extent that the Recovering
Beneficiary would not, after making any payment pursuant to this Clause 23 (Pro Rata Sharing),
have a valid and enforceable claim against the relevant Obligor.
	 
	23.6	 	A Recovering Beneficiary is not obliged to share with any other Beneficiary any amount which
the Recovering Beneficiary has received or recovered as a result of taking legal or
arbitration proceedings, if:






	 	23.6.1	 	it notified that other Beneficiary of the legal or arbitration proceedings; and
	 
	 	23.6.2	 	that other Beneficiary had an opportunity to participate in those legal or
arbitration proceedings but did not do so as soon as reasonably practicable having
received notice and did not take separate legal or arbitration proceedings.






	24.	 	COSTS, EXPENSES AND STAMP DUTIES
	 
	 	 	Initial and Continuing Costs and Expenses
	 
	24.1	 	BMUK shall (or shall procure that an Obligor shall), from time to time on demand of the
Agent, reimburse the Agent for all costs and expenses (including, without limitation, legal
fees) together with VAT thereon incurred by it in connection with the negotiation,
preparation, execution and administration of each of the Finance Documents and the completion
of the transactions contemplated therein and/or any amendment, variation or novation of,
supplement to, or waiver or consent in respect of, any of the Finance Documents, the cost of
any appraisals, inspections, verifications and audits of the Collateral or Group’s operation
the costs and expenses of forwarding loan proceeds, of the collection of all cheques and other
items of payment, of the establishment and maintenance of any Receivables Account or other
account and the costs and expenses of defending any claims made or threatened against the
Agent arising out of the transactions contemplated hereby.




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	 	 	Enforcement Costs and Expenses
	 
	24.2	 	BMUK shall, from time to time on demand of the Agent, reimburse the Agent, the Security
Trustee and each of the Lenders for all costs and expenses (including legal fees and a
reasonable estimate of the allocable cost of in-house counsel and staff) together with VAT
thereon incurred in or in connection with the termination of this Agreement or the
preservation and/or enforcement of any of the rights of any of the Beneficiaries under any of
the Finance Documents.
	 
	 	 	Stamp Duties
	 
	24.3	 	BMUK shall (or shall procure that an Obligor shall) pay all stamp, registration and other
taxes to which any of the Finance Documents or any judgment given in connection with any of
the Finance Documents is or at any time may be subject and shall, from time to time on demand
of the Agent, indemnify the Agent and any other Beneficiaries against any liabilities, costs,
claims and expenses resulting from any failure to pay or any delay in paying any such tax.
	 
	 	 	Provisions Relating to Payments
	 
	24.4	 	All payments to be made by BMUK (or any other Obligor) under this clause 24 shall be made
whether or not any Loan is made or Letter of Credit or Guarantee is issued under this
Agreement.
	 
	 	 	Indemnity by Lenders
	 
	24.5	 	If BMUK fails to perform any of its obligations under this Clause 24 (Costs, expenses and
stamp duties), each Lender shall (i) in the proportion borne by its Outstandings to the
aggregate of the Outstandings of all the Lenders; or (ii) if there are no Outstandings, in the
proportion borne by its Commitment to the Total Commitments; or (iii) if there are no
Outstandings and the Total Commitments have been cancelled at such time, in the proportion
borne by its Commitment to the Total Commitments immediately before they were cancelled (in
each case determined, and as at such time as may be specified, by the Agent), indemnify the
Agent, the Security Trustee and the other Lenders against any loss incurred by any of them as
a result of such failure (save for any failure caused by the gross negligence or wilful
default of any such party) and BMUK shall forthwith reimburse each Lender for any payment made
by it pursuant to this Clause 24.5 (Indemnity by Lenders).
	 
	25.	 	CALCULATIONS AND EVIDENCE OF DEBT
	 
	 	 	Basis of Calculation
	 
	25.1	 	Interest shall accrue from day to day and shall be calculated in the case of sterling on the
basis of a year of 365 days (or, in the case of dollars or euros, 360 days or, in any case
where market practice differs, in accordance with market practice) and the actual number of
days elapsed (not counting within any Interest Period the last day of that Interest Period).
If the basis of accrual of interest or any other amount expressed in this Agreement in respect
of sterling shall be inconsistent with any convention or practice in the London Interbank
Market for the basis of accrual of interest or any other amount in respect of euro, such
expressed basis shall be replaced by such convention or practice with effect from the date (if
any) of conversion of sterling into euro in accordance with EMU legislation.




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	 	 	Failure to Supply Quotations
	 
	25.2	 	In on any occasion a Reference Bank or a Lender fails to supply the Agent with a quotation
required of it under any provision of this Agreement, the rate for which such quotation was
required shall be determined from those quotations which are supplied to the Agent.
	 
	 	 	Loan Accounts
	 
	25.3	 	Each Lender shall maintain in accordance with its usual practice accounts evidencing the
amounts from time to time lent by and owing to it under this Agreement.
	 
	 	 	Control Account
	 
	25.4	 	The Agent shall maintain on its books a control account or accounts in which shall be
recorded (i) the amount of any Loan or unpaid sum made or arising under this Agreement and
each Lender’s share in such Loan or unpaid sum, (ii) the amount of all principal, interest and
other sums due or to become due from each Borrower to each of the Lenders under this Agreement
and each Lender’s share in each such amount and (iii) the amount of any sum received or
recovered by the Agent under this Agreement and each Lender’s share in such amount.
	 
	 	 	Lenders’ Books and Records.
	 
	25.5	 	Each Obligor agrees that the Agent’s and the Lenders’ books and records showing all amounts
from time to time lent by and owing to any of them under this Agreement and the transactions
pursuant to this Agreement and the other Finance Documents shall be admissible in any action
or proceeding arising therefrom, and shall constitute prima facie proof thereof (in the
absence of manifest error), irrespective of whether any such obligations are also evidenced by
any other instrument.
	 
	 	 	Monthly Statements
	 
	25.6	 	The Agent will provide to BMUK a monthly statement of Loans, payments and other transactions
pursuant to this Agreement. Such statement shall be deemed correct, accurate, and binding on
the Obligors and as an account stated (except for reversals and reapplications of payments
made as provided in Clause 20.7 (Refunding of Payments) and corrections of errors).
	 
	 	 	Certificates
	 
	25.7	 	A certificate by the Agent or any other Finance Party as to any sum payable by it under this
Agreement or any other Finance Document shall, in the absence of manifest error, be conclusive
for the purposes of this Agreement and such Finance Documents and prima facie evidence in any
legal action or proceedings arising out of or in connection with this Agreement or any other
Finance Documents.
	 
	 	 	Value Added Tax
	 
	25.8	 	All consideration (including interest and fees) payable under a Finance Document by the
Borrower to a Beneficiary shall be deemed to be exclusive of any VAT. If VAT is chargeable,
the Borrower shall pay to the Beneficiary (in addition to and at the same time as paying the
consideration) an amount equal to the amount of that VAT. Where a Finance Document requires
the Borrower to reimburse a Beneficiary for any costs or expenses, the Borrower shall also at
the same time pay and indemnify that Finance Party against all VAT incurred by that Finance
Party in respect of the costs and expenses.




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	26.	 	THE AGENT, THE ARRANGER, THE SECURITY TRUSTEE AND THE LENDERS
	 
	 	 	Appointment
	 
	26.1	 	Each Lender, the Arranger and the Security Trustee hereby appoints the Agent to act as its
agent in connection with this Agreement and the Agent and each of the Lenders hereby appoints
the Security Trustee to act as its trustee under and in relation to the Security Documents
pursuant to this Agreement and to hold the Trust Property as trustee for the Beneficiaries on
the trusts and other terms contained in the Security Documents and each Beneficiary hereby
irrevocably authorises the Agent and the Security Trustee to exercise such rights, powers and
discretions as are specifically delegated to the Agent or, as the case may be, the Security
Trustee by the terms of this Agreement and the Security Documents together with all such
rights, powers and discretions as are reasonably incidental thereto provided that the Agent
may not begin any legal action or proceeding in the name of a Lender without its consent.
	 
	 	 	Role of the Arranger
	 
	26.2	 	Except as specifically provided in the Finance Documents, the Arranger has no obligations of
any kind to any other party under or in connection with any Finance Document.
	 
	 	 	Relationships
	 
	26.3	 	The Agent in its capacity as such is agent for the Security Trustee and the Lenders and shall
not in any respect be the agent of any Borrower by virtue of this Agreement. Nothing in this
Agreement shall constitute the Agent or the Arranger a trustee or fiduciary for the Security
Trustee, any Lender, any Borrower or any other person.
	 
	 	 	Rights of the Agent and the Security Trustee
	 
	26.4	 	Each of the Agent and the Security Trustee may:






	 	26.4.1	 	assume that any representation made by any Obligor in connection with any of the
Finance Documents is true, that no Event of Default has occurred and that no Obligor
is in breach of or default under its obligations under any of the Finance Documents,
in each such case unless it has actual knowledge or actual notice to the contrary;
	 
	 	26.4.2	 	assume that the Facility Office of each Lender is that set out under its name at
the end of this Agreement or, in the case of a Transferee, at the end of the Transfer
Certificate to which it is a party as Transferee or, in the case of a Lender which is
an assignee or other successor of another Lender or former Lender, the office
notified to the Agent by the assignee or other successor on or before the date it
becomes a Lender or, if the Agent has been notified by any Lender of any change to
its Facility Office in accordance with the terms of this Agreement, that last
notified to the Agent;
	 
	 	26.4.3	 	engage and pay for the advice or services of any lawyers, accountants, surveyors or
other experts whose advice or services may to it seem necessary, expedient or
desirable and rely upon any advice so obtained;
	 
	 	26.4.4	 	rely as to any matters of fact which might reasonably be expected to be within the
knowledge of an Obligor upon a certificate signed by or on behalf of that Obligor;
	 
	 	26.4.5	 	rely upon any communication, certificate, legal opinion or other document believed
by it to be genuine;




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	 	26.4.6	 	refrain from exercising any right, power or discretion vested in it as agent or, as
the case may be, as trustee under any of the Finance Documents unless and until
instructed by the Majority Lenders as to whether or not such right, power or
discretion is to be exercised and, if it is to be exercised, as to the manner in
which it should be exercised and shall in all cases be fully protected when acting,
or refraining from acting, in accordance with instructions from the Majority Lenders;
	 
	 	26.4.7	 	refrain from acting in accordance with any instructions of the Majority Lenders to
protect or enforce the rights of any person under any of the Finance Documents until
it has been indemnified (or received confirmation that it will be so indemnified)
and/or secured to its satisfaction against any and all costs, losses, expenses
(including legal fees) and liabilities which it will or may expend or incur in
complying with such instructions;
	 
	 	26.4.8	 	retain for its benefit and without liability to account any fee or other sum
receivable by it for its own account;
	 
	 	26.4.9	 	accept deposits, lend money to, provide any advisory or other services to or engage
in any kind of banking or other business with any Group Company and, in each case,
may do so without liability to account.






	 	 	Obligations of the Agent and the Security Trustee
	 
	26.5	 	Each of the Agent and the Security Trustee shall:






	 	26.5.1	 	promptly (or otherwise in accordance with the terms hereof) advise each Lender of
the contents of any notice or document received by it from any Obligor under any of
the Finance Documents in its capacity as Agent or, as the case may be, Security
Trustee, except that details of any such communication relating to a particular
Lender shall be advised to that Lender only;
	 
	 	26.5.2	 	promptly notify each Lender of the occurrence of any Event of Default or any
default by any Obligor in the due performance of or compliance with its obligations
under any of the Finance Documents of which the Agent or, as the case may be, the
Security Trustee has actual knowledge or actual notice;
	 
	 	26.5.3	 	subject to the foregoing provisions of this Clause 26 (The Agent, the Arranger, the
Security Trustee and the Lenders), (in the case of the Agent) act as agent under this
Agreement or (in the case of the Security Trustee) act as trustee for the
Beneficiaries in accordance with any instructions given to it by the Majority Lenders
or as this Agreement may require and shall be fully protected in so doing. Unless
expressly provided otherwise in a Finance Document, any instructions given by the
Majority Lenders shall be binding on each of the Beneficiaries;
	 
	 	26.5.4	 	if so instructed by the Majority Lenders, refrain from exercising any right, power
or discretion vested in it in its capacity as Agent (under this Agreement) or in its
capacity as Security Trustee (under the Finance Documents);
	 
	 	26.5.5	 	have only those duties, obligations and responsibilities, which it is hereby
acknowledged in the case of the Agent are only of a mechanical and administrative
nature, expressly specified in each of the Finance Documents to which it is a party.




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	 	 	Exoneration
	 
	26.6	 	None of the Agent, the Arranger or the Security Trustee nor any of their respective personnel
or agents shall be:






	 	26.6.1	 	responsible for the adequacy, accuracy, completeness or reasonableness of any
representation, warranty, statement, projection, assumption or information in any
information memorandum or similar document prepared in connection with any proposed
syndication of the Facilities, any Finance Document or any notice or other document
delivered under or in connection with any Finance Document;
	 
	 	26.6.2	 	responsible for the execution, delivery, validity, legality, adequacy,
enforceability or admissibility in evidence of any Finance Document or any such
notice or other document;
	 
	 	26.6.3	 	obliged to enquire as to the occurrence or continuation of a Default or Event of
Default or the performance or compliance by any Obligor with its obligations under
any Finance Documents;
	 
	 	26.6.4	 	bound to account to any person for any sum or the profit element of any sum
received by it for its own account;
	 
	 	26.6.5	 	bound to disclose to any other person any information relating to any Obligor or
any Group Company, if such disclosure would or might in its opinion constitute a
breach of any law or regulation or be otherwise actionable at the suit of any person.






	 	 	Credit Assessment
	 
	26.7	 	Each Lender confirms that it has itself been, and will continue to be, solely responsible for
making its own independent investigation and appraisal of the business and operations,
financial condition, prospects, creditworthiness, status and affairs of each Borrower, each
other Obligor and each Group Company or any other person and has not relied, and will not at
any time rely, on the Agent, the Security Trustee or any other Lender:






	 	26.7.1	 	to check or enquire on its behalf into the adequacy, accuracy, completeness or
reasonableness of any representation, warranty, statement, projection, assumption or
information provided by any Obligor or any other person under or in connection with
any Finance Document or the transactions contemplated in any Relevant Agreement
(whether or not such information has been or is at any time hereafter circulated to
it by the Agent or the Security Trustee including any contained in any information
memorandum or similar document prepared in connection with any proposed syndication
of the Revolving Facility); or
	 
	 	26.7.2	 	to assess or keep under review on its behalf the business and operations, financial
condition, prospects, creditworthiness, status or affairs of any Borrower, other
Obligor or Group Company or any other person.






	 	 	The Agent and the Security Trustee as Lenders
	 
	26.8	 	The Agent and the Security Trustee shall each have the same rights and powers with respect to
its Commitment and Outstandings (if any) as any other Lender and may exercise those rights and
powers as if it were not also acting as the Agent or, as the case may be, the Security
Trustee.




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	 	 	Indemnity
	 
	26.9	 	Each Lender agrees that it shall, from time to time on demand of the Agent and/or Security
Trustee, indemnify the Agent and/or Security Trustee (to the extent not reimbursed by BMUK or
any other Obligor and without prejudice to any liability of the Borrower under this Agreement)
(i) in the proportion borne by its Outstandings to the aggregate of the Outstandings of all
the Lenders; or (ii) if there are no Outstandings, in the proportion borne by its Commitment
to the Total Commitments; or (iii) if there are no Outstandings and the Total Commitments have
been cancelled at such time, in the proportion borne by its Commitment to the Total
Commitments immediately before they were cancelled (in each case determined, and as at such
time as may be specified, by the Agent), against all costs, claims, expenses (including legal
fees) and liabilities which it may sustain or incur in connection with this Agreement or the
performance of its obligations and responsibilities under this Agreement save to the extent
that they are sustained or incurred by reason of the gross negligence or wilful misconduct of
the Agent or the Security Trustee or any of its personnel or agents and BMUK shall (or shall
procure that an Obligor shall) forthwith reimburse each Lender for any payment made by it
pursuant to this Clause 26.9 (Indemnity).
	 
	 	 	 Resignation
	 
	26.10	 	 
	 
	        Resignation






	 	26.10.1	 	Each of the Agent and the Security Trustee may following consultation with BMUK
and the Lenders resign its appointment under any of the Finance Documents at any time
by giving not less than thirty days’ notice in writing to that effect to each of the
other parties to this Agreement provided that such resignation shall not become
effective until a successor to the Agent or, as the case may be, the Security Trustee
has been appointed and accepted its appointment in accordance with the following
provisions of this Clause 26.10 (Resignation) and, in the case of the Security
Trustee, all necessary documents have been entered into to ensure that the benefit of
the Security Documents is held by such successor.






	 	 	 Appointment of Successor






	 	26.10.2	 	If the Agent or, as the case may be, the Security Trustee gives notice of its
resignation the Majority Lenders may appoint a successor. If the Majority Lenders
have not within sixty days after such notice of resignation appointed a successor to
the Agent or, as the case may be, the Security Trustee (which shall, in either such
case, be a reputable and experienced bank with an office in London) which shall have
accepted such appointment, the retiring Agent or, as the case may be, Security
Trustee shall have the right to appoint such a successor itself.






	 	 	 Discharge






	 	26.10.3	 	If a successor to the Agent or, as the case may be, Security Trustee is appointed
under the provisions of this Clause 26.10 (Resignation) then the retiring Agent or,
as the case may be, retiring Security Trustee shall be discharged from any further
obligations under the Finance Documents but shall remain entitled to the benefit of
the provisions of this Clause 26 (Resignation) and its successor and each of the
other parties to this Agreement shall have the same rights and obligations amongst
themselves as they would have had if such successor had been a party to this
Agreement.






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	 	 	 	Disclosure






	 	26.10.4	 	The retiring Agent or, as the case may be, Security Trustee, shall make available
to its successor such documents and records and provide such assistance as the
successor may reasonably request for the purpose of performing its functions under
the Finance Documents. Notwithstanding any provision in any Finance Document to the
contrary, neither the Agent nor the Security Trustee shall be obliged to disclose to
any person any confidential or other information if the disclosure would or might in
its reasonable opinion constitute a breach of any law or fiduciary duty.






	27.	 	TRUSTEE PROVISIONS
	 
	 	 	Declaration of Trust
	 
	27.1	 	The Security Trustee shall hold the Trust Property in trust for the benefit of the
Beneficiaries on the terms and subject to the conditions set out in this Agreement and the
terms of the other Finance Documents. Each Beneficiary hereby confirms its approval of the
Finance Documents and any security created or to be created pursuant thereto and hereby
authorises, empowers and directs the Security Trustee (by itself or such person(s) as it may
nominate) to execute and enforce the same as trustee (and whether or not expressly in the
Beneficiaries’ names) on its behalf.
	 
	 	 	Perpetuity Period
	 
	27.2	 	The perpetuity period under the rule against perpetuities (if applicable) shall be the period
of eighty years from the date of this Agreement.
	 
	 	 	Sums Received by the Security Trustee
	 
	27.3	 	Pending distribution under Clause 27.4 (Application of Sums Received), the Security Trustee
shall, if reasonably practicable, place any sum received, recovered or held by it in respect
of the Trust Property in an interest bearing suspense account with a bank or financial
institution in the name of or under the control of the Security Trustee. The interest paid on
such account shall be credited to the relevant account.
	 
	 	 	Application of Sums Received
	 
	27.4	 	Subject to the other provisions of this Clause 27 (Trustee Provisions), the Security Trustee
shall apply all amounts standing to the credit of any account referred to in Clause 27.3 (Sums
Received by the Security Trustee) and any other amounts realised pursuant to the exercise of
any rights or powers it might have pursuant to any of the Security Documents:






	 	27.4.1	 	first, in the payment of any costs, charges and expenses of or incidental to the
appointment of any Receiver pursuant to the Security Documents, the payment of his
remuneration and the payment and discharge of any other Expenses incurred by or on
behalf of the Receiver;
	 
	 	27.4.2	 	secondly, in or towards payment of any debts or claims which are by statute payable
in preference to the Secured Obligations but only to the extent to which such debts
or claims have such preference;
	 
	 	27.4.3	 	thirdly, in or towards payment and discharge pro rata of any Secured Obligations
then due, owing or incurred to the Security Trustee, in its capacity as Security
Trustee (and not in any other capacity) for its own account; and




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	 	27.4.4	 	fourthly, in payment to the Agent to be applied by the Agent in or towards payment
and discharge of the balance of the Secured Obligations (if any) in accordance with
the provisions of Clause 20.10 (Order of Distribution) provided that, when
distributing sums in accordance with this Clause 27.4 (Application of Sums Received),
the Security Trustee will treat any contingent liability as an actual liability and
distribute to the party entitled thereto accordingly. Any such party receiving sums
in respect of a contingent liability shall place such sums on deposit with such bank
(not being a bank entitled to exercise any right of set-off or combination or
consolidation of accounts or having the benefit of any encumbrance over such deposit)
and on such terms as the Security Trustee may approve and, if such contingent
liability shall fail to mature, shall return such sums (together with any interest
earned thereon) to the Security Trustee for distribution in accordance with the terms
of this Clause 27.4 (Application of Sums Received).






	 	 	 	Security Trustee’s Sole Right to Appropriate






	27.5	 	No Obligor shall have the right to appropriate any payment to, or other sum received,
recovered or held by, the Security Trustee in or towards payment of any particular part of the
Secured Obligations and the Security Trustee shall have the exclusive right to appropriate any
such payment or other sum as provided in this Clause 27 (Trustee Provisions).
	 
	 	 	Timing of Distribution
	 
	27.6	 	Distributions by the Security Trustee shall be made at such times as the Security Trustee in
its absolute discretion determines to be as soon as is reasonably practicable, having regard
to all relevant circumstances, and the Security Trustee shall have no liability whatsoever for
any loss or damage which any Beneficiary might sustain as a consequence of the timing of any
such distribution.
	 
	 	 	Date for Calculation of Secured Obligations
	 
	27.7	 	For the purpose of any distribution by the Security Trustee, the Security Trustee may, by
notice to the Beneficiaries, fix a date (being not earlier than the date of such notice) as at
which the amount of the Secured Obligations are to be calculated.
	 
	 	 	Certificate from Beneficiary
	 
	27.8	 	For the purposes of determining the amount of any payment to be made to any Beneficiary
pursuant hereto the Security Trustee shall be entitled to call for and rely upon (and it is
the intention of the parties that the Security Trustee shall rely upon) a certificate from the
relevant Beneficiary of the amount and nature of any amount due, owing or incurred to the
relevant Beneficiary at the date fixed by the Security Trustee for such purpose and as to such
other matters as the Security Trustee may deem necessary or desirable to enable it to make a
distribution.
	 
	 	 	Mistaken Payments
	 
	27.9	 	If the Security Trustee makes any distribution contrary to any of the provisions of this
clause 27 or any distribution made by it otherwise transpires to have been invalid or the
Security Trustee and the person receiving such distribution agree that it should be refunded,
the recipient shall, to the extent that no charge is thereby created, hold the proceeds of
that distribution on trust to repay to the Security Trustee forthwith on demand. If the trust
imposed by this Clause 28.9 (Mistaken Payments) cannot be given effect to for whatever reason,
including the possible creation thereby of a charge, the relevant recipient shall, if and when
so requested by the




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	 	 	Security Trustee, pay an amount equal to the proceeds of that distribution required to be held on trust to the
Security Trustee.
	 
	 	 	Supplement to Trustee Acts 1925 & 2000
	 
	27.10	 	By way of supplement to the Trustee Acts 1925 & 2000 it is expressly declared as follows:
	 
	 	 Experts






	 	27.10.1	 	the Security Trustee may, in relation to the Security Documents, act or rely upon
the opinion or advice of, or any information obtained from, any lawyer, valuer,
surveyor, broker, auctioneer, accountant or other expert commissioned by the Security
Trustee and shall not be responsible to anyone for any loss or damage occasioned by
so acting or relying. Any such opinion, advice or information may be sent or
obtained by letter, fax, e-mail or otherwise and the Security Trustee will not be
liable to anyone for acting in good faith on any opinion, advice or information
purporting to be conveyed by such means even if it contains some error or is not
authentic or validly signed;






	 	 	 	Certificate of BMUK






	 	27.10.2	 	the Security Trustee may call for and may accept as sufficient evidence a
certificate of BMUK signed by any director of BMUK to the effect that any particular
dealing, transaction, step or thing is, in the opinion of such director, suitable or
expedient or as to any other fact or matter upon which the Security Trustee may, in
the exercise of any of its rights, powers or duties hereunder, require to be
satisfied and the Security Trustee need not call for further evidence and will not be
responsible to anyone for any loss or damage occasioned by acting on any such
certificate;






	 	 	 	Interpretation of Security Documents






	 	27.10.3	 	the Security Trustee (as between itself and each of the Beneficiaries) shall have
full power to determine in good faith all questions and doubts arising in relation to
any of the provisions of the Security Documents and every such determination, whether
made upon such a question actually raised or implied in the acts or proceedings of
the Security Trustee, shall be conclusive and shall (save for manifest error) bind
the Security Trustee and each Beneficiary;






	 	 	 	Title






	 	27.10.4	 	the Security Trustee shall accept without enquiry, requisition, objection or
investigation such title as any Borrower (or, as the case may be, any Obligor) has to
the Trust Property to the intent that the Security Trustee shall not in any way be
responsible for its inability to exercise any of its rights or powers or duties
hereunder or for any loss or damage thereby occasioned;






	 	 	 	Perfection of security






	 	27.10.5	 	the Security Trustee shall not be liable for any failure, omission or defect in
perfecting any security created or purported to be created by or pursuant to any of
the Security Documents including (without prejudice to the generality of the
foregoing):






	 	(a)	 	failure to obtain any licence, consent or other authority
for the execution, delivery, validity, legality, adequacy, performance,
enforceability or admissibility in evidence of any of the Security Documents
or any other document;




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	 	(b)	 	failure to effect or procure registration of or otherwise
protect any security created or purported to be created by or pursuant to
any of the Security Documents or any other document by registering under any
applicable registration laws in any territory, any notice, caution or other
entry prescribed by or pursuant to the provisions of the said laws;
	 
	 	(c)	 	failure to take or require any of the Obligors to take
any steps to render the security created or purported to be created by or
pursuant to any of the Security Documents effective as regards any property
outside England and Wales or to secure the creation of any ancillary charge
under the laws of any territory concerned; or
	 
	 	(d)	 	failure to call for delivery of documents of title to or
require transfers, legal mortgages, charges or other further assurances in
relation to any of the Trust Property;






	 	 	 	Acts and omissions






	 	27.10.6	 	the Security Trustee shall not in fulfilling its duties and discharging its
responsibilities as Security Trustee be liable or responsible for any loss or damage
which may result from anything done or omitted to be done by it in accordance with
the provisions of the Security Documents;






	 	 	 	Compliance with laws






	 	27.10.7	 	the Security Trustee may refrain from doing anything which would or might in its
opinion be contrary to any law of any jurisdiction or any regulation or which would
or might otherwise render it liable to any person and may do anything which is, in
its absolute discretion, necessary to comply with any such law or regulation;






	 	 	 	Deposit of Security Documents






	 	27.10.8	 	the Security Trustee shall be at liberty to place all title deeds and other
documents certifying, representing or constituting the title to any of the Trust
Property for the time being in its hands in any safe deposit, safe or receptacle
selected by the Security Trustee or with any bankers or banking company (including
the Security Trustee or the Agent or any of the other Beneficiaries) or company whose
business includes undertaking the safe custody of documents or solicitors or firm of
solicitors, may pay all reasonable sums required to be paid on account of or in
respect of such deposit and may make any such arrangements as it thinks fit for
allowing any of the Obligors or their respective lawyers or auditors access to or
possession of such title deeds and other documents when necessary or convenient and
the Security Trustee shall not be responsible for any loss incurred in connection
with any such deposit, access or possession;






	 	 	 	Use of Nominees






	 	27.10.9	 	any investment of any part or all of the Trust Property may, at the discretion of
the Security Trustee, be made or retained in the names of nominees;






	 	 	 	Delegation






	 	27.10.10	 	the Security Trustee may, whenever it thinks fit, delegate by power of attorney
or otherwise to any person or persons, or fluctuating body of persons, all or any of
the rights, powers, authorities and discretions vested in it by any of the Finance




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	 	 	 	Documents and such delegation may be made upon such terms and subject to such
conditions (including the power to sub-delegate) and subject to such regulations
as it may think fit and it shall not be bound to supervise, or to be in any way
responsible for any loss, liability, costs, charges or expenses incurred by
reason of any misconduct or default on the part of, any such delegate or
sub-delegate (other than as a result of its gross negligence or wilful
misconduct); and






	 	 	 	Insurance






	 	27.10.11	 	without prejudice to any other provision of any of the Finance Documents, the
Security Trustee shall not be under any obligation to insure any of the Trust
Property or to require any other person to maintain any such insurance and shall not
be responsible for any loss or damage which may be suffered by any person as a result
of the lack of or inadequacy or insufficiency of any such insurance.






	 	 	 	Registration as Joint Proprietor






	27.11	 	Each of the Beneficiaries hereby confirms and agrees that it does not wish to be registered
as the joint proprietor of any mortgage or charge created pursuant to any Finance Document and
accordingly authorises the Security Trustee to hold such mortgage or charge in its sole name
as agent and trustee for the Beneficiaries and hereby requests the Land Registry to register
the Security Trustee as the sole proprietor of any such mortgage or charge.
	 
	 	 	Relationship with the Beneficiaries
	 
	27.12	 	The Security Trustee shall, for the purposes of the Finance Documents, be entitled to deal
with each of the Beneficiaries by dealing exclusively with the Agent.
	 
	 	 	Indemnity Provisions
	 
	27.13	 	The Security Trustee and every attorney, agent or other person appointed by it under any of
the Finance Documents may indemnify itself or himself out of the Trust Property against all
claims, demands, liabilities, proceedings, costs, fees, charges, losses and expenses incurred
by any of them in relation to or arising out of the taking or holding of the Trust Property,
the exercise or purported exercise of the rights, trusts, powers and discretions vested in any
of them or any other matter or thing done or omitted to be done in connection with any of the
Finance Documents or pursuant to any law or regulation (otherwise than as a result of its
gross negligence or wilful misconduct). Any appointee referred to above may enjoy the benefit
and enforce the terms of this Clause 27.13 (Indemnity Provisions) in accordance with the
provisions of the Contracts (Rights of Third Parties) Act 1999.
	 
	 	 	Appointment of Additional Security Trustees
	 
	27.14	 	The Security Trustee may at any time appoint any person (whether or not a trust corporation)
to act either as a separate trustee or as a co-trustee jointly with it (i) if it considers
such appointment to be in the interests of the Beneficiaries or (ii) for the purposes of
conforming to any legal requirements, restrictions or conditions which the Security Trustee
deems relevant for the purposes hereof and the Security Trustee shall give prior notice to the
Obligors of any such appointment. Any person so appointed shall (subject to the provisions of
the Finance Documents) have such powers, authorities and discretions and such duties and
obligations as shall be conferred or imposed on such person by the instrument of appointment
and shall have the same rights, powers, discretions and benefits under the Finance Documents
as the Security Trustee. Save where the contrary is indicated or unless the context otherwise
requires any reference in the Finance Documents to the Security Trustee shall be construed as
a reference to the Security Trustee and each such separate trustee and co-trustee. The
Security Trustee shall




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	 	 	 	have power in like manner to remove any person so appointed. Such remuneration as the
Security Trustee may pay to any person so appointed, and any costs, charges and expenses
incurred by such person in performing its functions pursuant to such appointment, shall
for the purposes hereof be treated as costs, charges and expenses incurred by the Security
Trustee in performing its function as trustee hereunder.
	 
	 	28.	 	ASSIGNMENTS AND TRANSFERS
	 
	 	 	 	Benefit of Agreement
	 
	 	28.1	 	This Agreement shall be binding upon and enure to the benefit of each of the parties to it,
any Transferee which becomes a party to it pursuant to a Transfer Certificate and each of
their respective successors and assigns.
	 
	 	 	 	Assignments and Transfers by an Obligor
	 
	 	28.2	 	No Obligor shall be entitled to assign or transfer all or any of its rights or obligations
under this Agreement.
	 
	 	 	 	Assignments and Transfers by Lenders





28.3





	 	28.3.1	 	Any Lender may at any time with the prior written consent of the Agent and after
consultation with BMUK but without the prior written consent of BMUK or any other
party to this Agreement assign all or any of its rights under this Agreement to any
bank or financial institution which is a Qualifying Lender or transfer in accordance
with Clause 28.4 (Transfer Certificate) all or any of its rights and obligations
under this Agreement to any such Qualifying Lender.
	 
	 	28.3.2	 	If any Lender assigns all or any of its rights under this Agreement in accordance
with Clause 28.3.1 then, unless and until the assignee has agreed with the Agent, the
Security Trustee and the other Lenders that it shall be under the same obligations
towards each of them as it would have been under if it had been a party to this
Agreement, the Agent, the Security Trustee and the other Lenders shall not be obliged
to recognise such assignee as having the rights against each of them which it would
have had if it had been a party to this Agreement.






	 	 	 	Transfer Certificate






	28.4	 	If any Lender wishes to transfer all or any of its rights and obligations under this
Agreement in respect of the whole or any part of any Commitment in respect of the Revolving
Facility and/or its Outstandings as contemplated in Clause 28.3.1, then such transfer may be
effected by the delivery to the Agent of a duly completed and duly executed Transfer
Certificate but only if it relates to its Commitment and/or its Outstandings in respect of all
the Facilities in which it is participating at that time. Subject to Clause 28.5 (Acceptance
and Delivery of Transfer Certificates), the Agent shall, on receipt of such certificate,
countersign it and subject to the terms of that Transfer Certificate and on the date specified
in that Transfer Certificate:






	 	28.4.1	 	each Obligor and the relevant Lender shall, to the extent provided in such Transfer
Certificate, each be released from further obligations to each other under this
Agreement and their respective rights against each other shall be cancelled (such
rights and obligations being referred to in this Clause 28 (Assignments and
Transfers) as “discharged rights and obligations”);




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	 	28.4.2	 	each Obligor and the Transferee party to the relevant Transfer Certificate shall
each assume obligations towards, and acquire rights from, each other which differ
from the discharged rights and obligations only insofar as such Obligor and the
Transferee have assumed and acquired the same in place of such Obligor and that
Lender;
	 
	 	28.4.3	 	the Transferee and the other parties to this Agreement (other than the Obligor)
shall acquire the same rights and assume the same obligations between themselves as
they would have acquired and assumed had such Transferee been an original party to
this Agreement as a Lender with the rights and obligations acquired or assumed by it
as a result of such transfer (and, to that extent, the transferor Lender and such
other parties shall each be released from further obligations to each other).






	 	 	 	Acceptance and Delivery of Transfer Certificates






	28.5	 	The Agent shall not be obliged to accept any Transfer Certificate received by it under this
Agreement on any day on or after the receipt by it of a Utilisation Notice and prior to the
making of the relative Loan or issue of the relevant Letter of Credit or Guarantee. Further,
the Agent shall not be obliged to accept a Transfer Certificate unless the Lender delivering
that Transfer Certificate has also delivered to the Agent and the Receivables Purchaser a duly
signed and dated substitution certificate (as provided for in the funding agreement to be
entered into between the Lenders and the Receivables Purchaser) in connection with the Invoice
Discounting Agreements in form and substance satisfactory to the Agent and the Receivables
Purchaser pursuant to which it agrees, amongst other things, to participate through its
Facility Office in all Prepayments and other payments to be made by the Receivables Purchaser
under the applicable Invoice Discounting Agreement in the proportion which its Commitment
bears to the Total Commitments immediately prior to the making of such Prepayments or other
payment. Subject thereto the Agent shall promptly deliver a copy of any Transfer Certificate
received by it to BMUK.






	 	 	 	Reliance on Transfer Certificates






	28.6	 	The Agent shall be fully entitled to rely on any Transfer Certificate delivered to it in
accordance with the provisions of this Clause 28 (Assignments and Transfers) which is complete
and regular on its face as regards its contents and purportedly signed on behalf of the Lender
and the Transferee and shall have no liability or responsibility to any party as a consequence
of placing reliance on and acting in accordance with any such Transfer Certificate.






	 	 	 	Register of Assignments, Transfers and Fees





28.7





	 	 	 	Register






	 	28.7.1	 	The Agent shall (on behalf of the Lenders) maintain at its address for the service
of notices as specified in Clause 32 (Notices) a register in which the Agent shall,
as soon as practicable following the date of this Agreement and thereafter on each
business day following receipt by it of any Transfer Certificate duly completed in
accordance with the provisions of this Clause 28 (Assignments and Transfers) or any
certificate signed on behalf of each Lender assigning any of its rights hereunder and
the person to whom such rights are to be assigned (provided the provisions of Clause
28.3 (Assignments and Transfers by Lenders) have been complied with) and in each such
case incorporating the administrative details of the Transferee or assignee, record
(where appropriate in place of the corresponding details relating to the transferor
or assigning Lender) the names, interests and administrative details from time to
time of the Lenders having rights and/or obligations under this Agreement. The Agent
shall




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	 	 	 	make the register available for inspection by any party to this Agreement during
normal banking hours upon receipt by the Agent of reasonable prior notice to that
effect.






	 	 	 	Fees






	 	28.7.2	 	On the date upon which the transfer or assignment takes effect in accordance with
the terms of this Agreement and, as the case may be, any Transfer Certificate or
assignment documents, the Transferee named in the Transfer Certificate or the
relevant assignee shall pay to the Agent for its own account a transfer fee of £2000.






	 	 	 	Change of Facility Office






	28.8	 	Any Lender may at any time change its Facility Office in relation to its Commitment and/or
Outstandings by notifying the Agent of the address and fax details of such new office.
	 
	 	 	Disclosure of Information
	 
	28.9	 	The Agent, the Security Trustee or any Lender may (on a confidential basis) disclose to any
actual or potential assignee, Transferee, sub-participant or other person who may otherwise
enter into or be proposing to enter into contractual relations with the Agent, the Security
Trustee or such Lender (as the case may be) in relation to this Agreement such information
about any Borrower, any other Obligor or any other person as it thinks fit.
	 
	 	 	Increased Payments following Assignment or Transfer
	 
	28.10	 	If at the time of, or immediately after, any assignment or transfer by a Lender or any
change in its Facility Office, circumstances are such that any Obligor would be obliged to pay
to an assignee, Transferee (or, in the case of a change of Facility Office, the relevant
Lender) under Clause 10 (Taxes) or 11 (Increased Costs) any sum in excess of the sum (if any)
which it would have been obliged to pay to that Lender under the relevant clause in the
absence of that assignment, transfer or change, that Obligor shall not be obliged to pay that
excess.
	 
	29.	 	TERM AND TERMINATION
	 
	 	 	Expiry of Agreement
	 
	29.1	 	This Agreement shall expire on the Termination Date unless earlier terminated in accordance
with the terms of this Agreement.
	 
	 	 	Rights to Terminate
	 
	29.2	 	BMUK may terminate this Agreement at any time prior to the Termination Date if:






	 	29.2.1	 	it gives the Agent sixty (60) days prior written notice of termination;
	 
	 	29.2.2	 	it has paid and performed in full all its obligations hereunder on or prior to the
effective date of termination; and
	 
	 	29.2.3	 	it pays the Agent, on or prior to the effective date of termination, and in
addition to any other prepayment premium required hereunder and any amounts required
by Clauses 19.1 (General Indemnities) and 19.2 (Break Costs):






	 	(a)	 	0.75% of the aggregate on such date of the Maximum
Revolving Credit Line, if such termination is made on or prior to the first
Anniversary Date;




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	 	(b)	 	0.5% of the aggregate on such date of the Maximum
Revolving Credit Line, if such termination is after the first Anniversary
Date but on or prior to the second Anniversary Date; and
	 
	 	(c)	 	0.25% of the aggregate on such date of the Maximum
Revolving Credit Line, if such termination is at any time after the second
Anniversary Date but on or prior to the date falling two months before the
third Anniversary Date.






	 	 	 	PROVIDED THAT no fee shall be payable under this Clause 29.2.3 if this Agreement
is terminated by the Revolving Facility being refinanced through a securitisation
arranged by Bank of America, National Association.






	 	 	 	Effect of Termination






	29.3	 	Upon the effective date of termination of this Agreement for any reason whatsoever, the
Loans, all unpaid accrued interest or fees and any other sum then payable under this Agreement
shall become immediately due and payable, the Commitment and the Available Commitment of each
Lender shall be reduced to nil and each relevant Borrower shall immediately arrange for the
cancellation of each Guarantee or Letter of Credit then outstanding and shall deposit with the
Security Trustee with respect thereto a Supporting Letter of Credit or cash in the same manner
as contemplated in Clause 6.14 (Supporting Letter of Credit; Cash Collateral). Notwithstanding
the termination of this Agreement, until all such sums are paid and performed in full, the
Agent and the Lenders shall retain all their rights and remedies hereunder and under all other
Finance Documents.






	30.	 	AMENDMENTS, WAIVERS AND REMEDIES
	 
	 	 	Amendments






	30.1	 	Subject to the proviso to this Clause 30.1 (Amendments), the Agent may if authorised by the
Majority Lenders in writing (or to the extent expressly authorised by the other provisions of
this Agreement or any other document entered into pursuant to this Agreement) on behalf of the
Lenders amend or vary the terms of or waive breaches of or defaults under, or otherwise excuse
performance of any provision of, or grant consents under, this Agreement or any such other
document. Any amendment, variation, waiver, release or consent authorised under this Clause
30.1 (Amendments) and which is effected by the Agent must be in writing and may be given
subject to such conditions as the person giving it may specify and shall be binding on all the
parties to this Agreement and the Agent shall be under no liability in respect thereof
provided that the consent of all the Lenders in writing shall be required in respect of:






	 	30.1.1	 	any increase in the Total Commitments or change in the Termination Date;
	 
	 	30.1.2	 	any extension of the date for, or alteration in the amount or currency of, any
payment of principal, interest, fee or other amounts payable under this Agreement;
	 
	 	30.1.3	 	any change in the rate at which interest is payable under this Agreement;
	 
	 	30.1.4	 	the definition of “Majority Lenders”;
	 
	 	30.1.5	 	any release or deferment of the granting or perfecting of an encumbrance or any of
the Collateral except in connection with any permitted disposal of Equipment or any
disposal permitted under Clause 16.3.2 (Disposals)) or any Security Interest or any
guarantee or similar undertaking provided by any person;




109









 












	 	30.1.6	 	this Clause 30.1 (Amendments),






	 	 	and, in respect of a Bank Product, the consent of BofA and the other party to that Bank
Product alone shall be required in respect of any amendment, variation, waiver, release or
consent in respect of that Bank Product.






	 	 	Waivers






	30.2	 	No failure to exercise, nor any delay in exercising, on the part of the Agent, the Security
Trustee or any Lender, any right or remedy under this Agreement shall operate as a waiver
thereof, nor shall any single or partial exercise of any right or remedy prevent any further
or other exercise of such right or remedy or the exercise of any other right or remedy. The
rights and remedies provided in this Agreement are cumulative and not exclusive of any rights
or remedies provided by law.






	31.	 	PARTIAL INVALIDITY
	 
	 	 	If, at any time, any provision of the Finance Documents is or becomes illegal, invalid or
unenforceable in any respect under any law of any jurisdiction:






	 	(a)	 	it shall be ineffective only to that extent, without invalidating the
remainder of such Finance Document(s); and
	 
	 	(b)	 	neither the legality, validity or enforceability of such provision under
the law of any other jurisdiction will in any way be affected or impaired thereby.






	32.	 	NOTICES
	 
	 	 	General






	32.1	 	Any demand, notice or other communication or document to be made or delivered under or in
connection with the Finance Documents shall be made or delivered by fax or otherwise in
writing and shall be treated as having been served if served in accordance with Clause 32.2
(Mode of Service). Each demand, notice, communication or other document to be made on or
delivered to any party to the Finance Documents may (unless that other person has by 10
business days’ written notice to the other specified another address or fax number) be made or
delivered to that other person at its registered office or the address or fax number (if any)
set out under its name at the end of this Agreement or, in the case of a Transferee, at the
end of the Transfer Certificate to which it is a party as Transferee or, in the case of a
Lender which is an assignee or other successor of another Lender or former Lender, as notified
to the Agent by the assignee or other successor on or before the date it became a Lender.
	 
	 	 	Mode of Service






	32.2	 	Any demand, notice, communication or other document to be made or delivered from or to an
Obligor shall be delivered to, by or through the Agent. Subject thereto, service of any
demand, notice or other communication or document to be made or delivered under the Finance
Documents may be made:






	 	32.2.1	 	by leaving it at the address for service referred to in Clause 32.1 (General);
	 
	 	32.2.2	 	by sending it by pre-paid first class letter (or by airmail if to or from an
address outside the United Kingdom) through the post to the address for service
referred to in Clause 32.1 (General); or




110









 












	 	32.2.3	 	by fax to the fax number of the recipient and so that any fax shall be deemed to be
in writing and, if it bears the signature of the server or its authorised
representative or agent, to have been signed by or on behalf of the server.






	 	 	 	Deemed Service





32.3





	 	32.3.1	 	Any notice or other communication or document from an Obligor (or Idea on its
behalf) shall be irrevocable and shall not be effective until its actual receipt by
the Agent. Any other notice, demand or other communication or document shall be
served or treated as served at the following times:






	 	(a)	 	in the case of service personally or in accordance with
Clause 32.2.1, at the time of such service;
	 
	 	(b)	 	in the case of service by post, at 9.00 a.m. on the
working day next following the day on which it was posted or, in the case of
service to or from an address outside the United Kingdom, at 9.00 a.m. on
the fourth day following the day on which it was posted; and
	 
	 	(c)	 	in the case of service by fax, if sent before 9.00 am on
a working day, at 11.00 a.m. on the same day, if sent between 9.00 a.m. and
5.30 p.m. on a working day, two hours after the time of such sending or, if
sent after 5.30 p.m. on a working day or on a day other than a working day,
at 9.00 a.m. on the next following working day.






	 	32.3.2	 	For the purposes of this Clause 32 (Notices) the term “working day” shall mean a
day (other than a Saturday or Sunday) upon which the recipient of any demand, notice,
communication or other document is normally open for business in the country of its
address for service referred to in Clause 32.1 (General) and references to any time
of day shall be construed as references to the time of day on such working day in
that country.






	 	 	Proof of Service
	 
	32.4	 	In proving service of any demand, notice, communication or other document served:






	 	32.4.1	 	by post, it shall be sufficient to prove that such demand, notice, communication or
other document was correctly addressed, full postage paid and posted; and
	 
	 	32.4.2	 	by fax, it shall be sufficient to prove that the fax was followed by such machine
record as indicates that the entire fax was sent to the relevant number.






	33.	 	COUNTERPARTS
	 
	 	 	Each Finance Document may be executed in any number of counterparts, and this has the same
effect as if the signatures on the counterparts were on a single copy of the Finance
Document.
	 
	34.	 	DUTCH PARALLEL DEBT
	 
	 	 	Without prejudice to the provisions of this Agreement and for the purpose of ensuring and
preserving the validity and continuity of the security rights granted and to be granted by
any of the Obligors under or pursuant to the Security Documents, each of the Beneficiaries
hereby acknowledges and consents to BMEBV and to any other Obligor incorporated or
established




111









 






	 	 	under the laws of the Netherlands (each, a “Dutch Obligor”) that are at any time party to
any Security Document, undertaking to pay to Bank of America, National Association, acting
in its capacity as Security Trustee, amounts (i) equal to the amounts due from time to
time by the Obligors to the Beneficiaries in respect of the Secured Obligations and (ii)
due and payable at the same time as the corresponding amounts in respect of the Secured
Obligations are or shall be due and payable (such payment undertaking and the obligations
and liabilities resulting therefrom being, the “Parallel Debt”). The Beneficiaries hereby
agree that the Parallel Debt is a claim of Bank of America, National Association (in its
capacity as Security Trustee) which is independent and separate from, and without
prejudice to, the claims of Beneficiaries in respect of the Secured Obligations, and is
not a claim which is held jointly with the Beneficiaries provided that, to the extent any
amounts are paid to Bank of America, National Association under the Parallel Debt or that
Bank of America, National Association otherwise receives moneys in payment of the Parallel
Debt, the total amount due and payable in respect of the Secured Obligations shall be
decreased as if the said amounts were received directly in payment of the outstanding
Secured Obligations. Bank of America, National Association, acting in its capacity as
Security Trustee, hereby agrees to transfer to the Agent for the benefit of the
Beneficiaries all proceeds that it receives or recovers from any Dutch Obligor in
connection with any enforcement action taken under or pursuant to any Security Document.






	35.	 	LAW AND JURISDICTION
	 
	 	 	Law
	 
	35.1	 	This Agreement shall be governed by, and construed in accordance with, English law.
	 
	 	 	Jurisdiction
	 
	 	 	35.2
	 
	 	 	Submission






	 	35.2.1	 	Each Obligor irrevocably agrees for the benefit of the other parties hereto that
the courts of England shall have jurisdiction to hear and determine any suit, action
or proceeding, and to settle any disputes, which may arise out of or in connection
with this Agreement and, for such purposes, irrevocably submits to the jurisdiction
of such courts.






	 	 	 	Forum






	 	35.2.2	 	Each Obligor irrevocably waives any objection which it might now or hereafter have
to the courts referred to in Clause 35.2.1 (Submission) being nominated as the forum
to hear and determine any suit, action or proceeding, and to settle any disputes,
which may arise out of or in connection with this Agreement and agrees not to claim
that any such court is not a convenient or appropriate forum.






	 	 	 	Service of process






	 	35.2.3	 	BMEH, BMEP and BMEBV each agree that the process by which any suit, action or
proceeding is begun may be served on it by being delivered in connection with any
suit, action or proceeding in England, to BMUK at its registered office for the time
being.




112









 












	 	 	 	Other competent jurisdictions






	 	35.2.4	 	The submission to the jurisdiction of the courts referred to in Clause 35.2.1
(Submission) shall not (and shall not be construed so as to) limit the right of the
other parties hereto, or any of them, to take proceedings against any Obligor in any
other court of competent jurisdiction nor shall the taking of proceedings in any one
or more jurisdictions preclude the taking of proceedings in any other jurisdiction,
whether concurrently or not.






	 	 	 	Consent to enforcement






	 	35.2.5	 	Each Obligor hereby consents generally in respect of any legal action or proceeding
arising out of or in connection with this Agreement to the giving of any relief or
the issue of any process in connection with such action or proceeding including,
without limitation, the making, enforcement or execution against any property
whatsoever (irrespective of its use or intended use) of any order or judgment which
may be made or given in such action or proceeding.




AS WITNESS the hands of the duly authorised representatives of the parties hereto the day and year
first before written.




113









 








SCHEDULE 1



LENDERS AND COMMITMENTS




	 	 	 	 	 
	Lender
	 	Commitment (£)
	Bank of America, National Association
	 	 	50,000,000	 
	Lloyds TSB Commercial Finance Limited
	 	 	20,000,000	 
	Enterprise Finance Europe (UK) Limited
	 	 	6,000,000	 
	Total
	 	 	76,000,000	 






114









 






SCHEDULE 2




CONDITIONS PRECEDENT




[Note: this Schedule reflects the conditions precedent under the
Agreement at the time it was originally entered into. It does not
reflect subsequent documentation delivered pursuant to the Supplemental
Agreements.]



A   Original documents to be collected by the Agent





	1.	 	A certificate dated in the form appearing in Schedule 3 duly executed by each Obligor with
all required enclosures.
	 
	2.	 	The Debenture duly executed by each Obligor and all other documents to be delivered pursuant
thereto and notice of the assignment of each of its Receivables Accounts and of the Policies
(as therein defined) having been given to, and acknowledged by, the bank at which each such
Receivables Account is to be maintained or, as appropriate, by the relevant broker or insurer
with which or through whom such Policy is placed.
	 
	3.	 	All share certificates in respect of shares held by each Obligor and charged pursuant to the
Debenture together with instruments of transfer endorsed in blank as required by the terms of
the Debenture.
	 
	4.	 	Confirmation from BMUK that the terms of all contracts or arrangements under which Inventory
is supplied to the Trading Companies on reservation of title terms have not been amended since
completion of the review thereof by the Agent during the July/August 2002 audit.
	 
	5.	 	Utilisation Notice in respect of the first Revolving Loan and any Swingline Loan in
substantially the form set out in Schedule 4 duly executed by the relevant Borrower.
	 
	6.	 	Policies of insurance, including credit insurance, acceptable to the Agent with the name of
the Security Trustee endorsed as loss payee in respect of such policies as may be specified by
the Agent and acknowledgements of assignment in satisfactory terms signed by underwriters of
the insurance policies assigned by the Obligors pursuant to the Debenture.
	 
	7.	 	In relation to each Obligor, details of each of its clearing accounts and each (if any) of
its Receivables Accounts.
	 
	8.	 	An opinion of Dutch counsel addressed to the Agent as to, among other matters, the entry into
and performance by BMEP and BMEBV of the Finance Documents to which they are a party and
legal, valid, binding and enforceable nature of their respective obligations thereunder.
	 
	9.	 	The Pro-Forma Balance Sheet of BMEP.
	 
	10.	 	The Latest Projections.
	 
	11.	 	The Priority Agreement duly executed by the parties thereto.
	 
	12.	 	A Warranty (in terms satisfactory to the Agent) by BMUK as to the value of the Inventory and
the Accounts of the Trading Companies as at the Closing Date.
	 
	13.	 	A report by BMUK showing, in relation to the Trading Companies, details of monthly ageings of
accounts receivable, monthly ageings of accounts payable and details of all preferential
creditors and of cash, if any, at bank as at 31 October 2002.




115









 






	14.	 	An undertaking issued by The Royal Bank of Scotland plc in favour of the Security Trustee
agreeing, on the terms and conditions therein set out, to effect a daily cash sweep to the
Security Trustee of all amounts standing to the credit of the account therein described.





B  Evidence





	1.	 	Evidence as to the discharge of all indebtedness and financing facilities (other than
Permitted Indebtedness) (including, without limitation, the discharge in full of the Existing
Facilities) of and encumbrances (other than Permitted Encumbrances) over the assets of, any
Group Company which may exist at the date of this Agreement including, without limitation, all
encumbrances created by any Group Company in favour of National Westminster Bank Plc or The
Royal Bank of Scotland Commercial Services Limited or any of their Affiliates other than the
legal mortgage dated 31 October 2000 created by Bell Microproducts Limited over the
Chessington Property in favour of the existing Chessington Mortgagee.
	 
	2.	 	BMUK shall have paid (to the extent then payable) all fees payable on the date of this
Agreement including all fees and expenses of the Agent’s legal advisers in connection with any
of the Finance Documents and the transactions contemplated thereby.
	 
	3.	 	The Agent being satisfied that the ageing profile and turnover of Accounts and Inventory has
not deteriorated as against their ageing profile and turnover at the time of the audit thereof
by the Agent.
	 
	4.	 	There shall have occurred no material adverse change in the business or financial condition
of any Borrower, any Obligor or the Group (taken as a whole) or in the Collateral since the
date of the Pro Forma Balance Sheet and the Group has met the financial performance
projections contained in the Latest Projections, and the Agent has received a certificate of
BMUK’s chief executive officer to such effect.
	 
	5.	 	After taking into account any Revolving Loans or Swingline Loans to be made on the Closing
Date and any Letters of Credit or Guarantees issued or to be issued on the Closing Date and
with all the obligations of the Borrowers being current there shall be remaining an Available
Revolving Facility Amount of at least £5,000,000.
	 
	6.	 	Evidence satisfactory to the Agent that there has been no change to the legal structure of
Group since 1 June 2002 and that the Adjusted Tangible Net Worth of BMEP is not less than
EUR18,467,000.
	 
	7.	 	Evidence that BMUK has agreed to act as the agent of BMEP and BMEBV for the service of
process in England.




116









 











SCHEDULE 3




FORM OF OBLIGOR’S CERTIFICATE




	 	 	 
	From:

	 	[Obligor’s name and address]
	 
	 	 
	To:

	 	Bank of America, National Association
	 

	 	Business Capital, Portfolio Management
	 

	 	5 Canada Square
	 

	 	London, E14 5AQ
	 

	 	as Agent for and on behalf of the Lenders
	 
	 	 
	Attention:

	 	Lee Masters





Credit Agreement dated 2 December 2002 and made between, among others, Ideal Hardware Limited and
Bell Microproducts Europe Export Limited as Original Borrowers, Bank of America, National
Association as Agent, Arranger, Issuer, Swingline Lender and Security Trustee and the Lenders named
therein (as amended from time to time the “Credit Agreement”).



This certificate is provided for the purposes of the Credit Agreement. Unless stated otherwise,
terms defined in the Credit Agreement shall have the same meanings in this certificate. We [     ], and [     ], the secretary and a director respectively of the
[relevant Obligor] hereby certify that:





	1	 	The copy or copies delivered herewith:
	 
	1.1	 	of the memorandum and articles of association, certificate of incorporation and
certificate(s) of incorporation on change of name (if any) of [relevant Obligor] marked “A”;
	 
	1.2	 	of a resolution of the board of directors of [relevant Obligor] approving the execution and
delivery of the Finance Documents to which it is party and the performance of its obligations
thereunder and authorising a named person or persons to sign such Finance Documents and any
documents to be delivered by [relevant Obligor] pursuant thereto marked “B”;
	 
	1.3	 	marked “C”, being copies of each law, decree, consent, licence, approval, registration or
declaration as is, in the opinion of local counsel to the Agent, necessary to render the
Finance Documents to which it is a party valid, legally binding and enforceable and to make
each of them admissible in evidence in England and Wales and, if different, the [relevant
Obligor’s] jurisdiction of incorporation and any jurisdiction in which any of its assets may
be situated and to enable [relevant Obligor] to perform its obligations under such Finance
Documents;
	 
	1.4	 	[marked “D”, being copies of each Environmental Licence held by [relevant Obligor];]
	 
	1.5	 	[marked “E”, being copies of each policy of insurance maintained by each Borrower and each
other [Obligor] [Group Company];]*
	 
	1.6	 	[marked “F” are copies of each of the Material Contracts as may be required by the Agent;
and]*
	 
	1.7	 	[of the register of members and directors and secretary of [relevant Obligor] marked “G”],




are in each such case true, complete and up to date copies of the originals.




117









 









	2	 	The persons whose names are listed below have been authorised on behalf of the [relevant
Obligor], and pursuant to the board resolution described above to execute the Finance
Documents to which [relevant Obligor] is party and any documents or notices to be delivered by
[relevant Obligor] pursuant thereto and the signatures set opposite their names are their true
signatures:





	 	 	 	 	 	 	 
	Name of Signatory

	 	 	 	Signature	 	 
	 
	 	 	 	 	 	 
	 


	 	 
	 	 

	 	 
	 
	 	 	 	 	 	 
	 


	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 


	 	 
	 	 

	 	 
	 
	 	 	 	 	 	 
	 


	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 


	 	 
	 	 

	 	 
	 
	 	 	 	 	 	 
	 


	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 


	 	 
	 	 

	 	 
	 
	 	 	 	 	 	 
	 


	 	 	 	 	 	 






	 	 	 	 	 	 	 
	 


	 	 
	 	 

	 	 
	 
	 	 	 	 	 	 
	Secretary
	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	Name:

	 	 	 	Date	 	 
	 
	 	 	 	 	 	 
	 


	 	 
	 	 

	 	 
	 
	 	 	 	 	 	 
	Director
	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	Name:

	 	 	 	Date	 	 






[relevant Obligor]




 





*BMUK’s certificate only




118









 





SCHEDULE 4




FORM OF UTILISATION NOTICE




	 	 	 
	From:

	 	[relevant Borrower]
	 
	 	 
	To:

	 	Bank of America, National Association
	 

	 	Business Capital, Portfolio Management
	 

	 	5 Canada Square
	 

	 	London, E14 5AQ
	 

	 	as Agent for and on behalf of the Lenders






Dear Sirs,





	1	 	We refer to the agreement (as from time to time amended, varied, supplemented, novated or
replaced, the “Credit Agreement”) dated 2 December 2002 and made between, among others,
ourselves as Borrower, yourselves as the Agent, Arranger and Security Trustee and the Lenders
therein referred to. Terms defined in the Credit Agreement have the same meanings in this
notice.






	2	 	We hereby give you irrevocable and unconditional notice that, pursuant to the Credit
Agreement and on [date of proposed Loan/issue of Letter of Credit/issue of Guarantee], we wish
to:






	2.1	 	borrow a Swingline Loan [in the amount of £   ] [in the Original Sterling Amount of £   ] [in [specify agreed Foreign Currency]];






	2.2	 	borrow a [Reference Rate/LIBOR] Revolving Loan [in the amount of £   ] [in the Original
Sterling Amount of £   ] [in [specify agreed Foreign Currency]] having an initial Interest
Period of [     ] months;






	2.3	 	[have a Letter of Credit issued in favour of [     ] for [£   /other currency amount] maturing not later than [     ] and in respect of
[specify details]];






	2.4	 	[have a Guarantee issued in favour of [     ] for [£   /other currency amount] maturing not later than [     ] and in
respect of [specify details]],






	[in each case] upon the terms and subject to the conditions contained in the Credit Agreement.






	3	 	We confirm that, as at today’s date, the representations set out in clauses 14.1 and 14.2 of
the Credit Agreement are true and that no Default has occurred or is foreseen by us.





Yours faithfully,




                                        




for and on behalf of




[Borrower]




119









 





SCHEDULE 5




MANDATORY COST FORMULAE





	1.	 	The Mandatory Cost is an addition to the interest rate to compensate Lenders for the cost of
compliance with (a) the requirements of the Bank of England and/or the Financial Services
Authority (or, in either case, any other authority which replaces all or any of its functions)
or (b) the requirements of the European Central Bank.






	2.	 	On the first day of each Interest Period (or as soon as possible thereafter) the Agent shall
calculate, as a percentage rate, a rate (the “Additional Cost Rate”) for each Lender, in
accordance with the paragraphs set out below. The Mandatory Cost will be calculated by the
Agent as a weighted average of the Lenders’ Additional Cost Rates (weighted in proportion to
the percentage participation of each Lender in the relevant Loan) and will be expressed as a
percentage rate per annum.






	3.	 	The Additional Cost Rate for any Lender lending from a Facility Office in a participating
member state will be the percentage notified by the Lender to the Agent. This percentage will
be certified by that Lender in its notice to the Agent to be its reasonable determination of
the cost (expressed as a percentage of that Lender’s participation in all Loans made from that
Facility Office) of complying with the minimum reserve requirements of the European Central
Bank in respect of loans made from that Facility Office.






	4.	 	The Additional Cost Rate for any Lender lending from a Facility Office in the United Kingdom
will be calculated by the Agent as follows:






	4.1	 	in relation to a sterling Loan:
	 
	 	 	         
	 
	4.2	 	in relation to a Loan in any currency other than sterling:
	 
	 	 	         





Where:





	A 	 	is the percentage of Eligible Liabilities (assuming these to be in
excess of any stated minimum) which that Lender is from time to
time required to maintain as an interest free cash ratio deposit
with the Bank of England to comply with cash ratio requirements.
	 
	B 	 	is the percentage rate of interest (excluding the Margin and the
Mandatory Cost and, if the Loan is an unpaid sum, the additional
rate of interest specified in clause 18.3) payable for the relevant
Interest Period on the Loan.
	 
	C 	 	is the percentage (if any) of Eligible Liabilities which that
Lender is required from time to time to maintain as interest
bearing Special Deposits with the Bank of England.
	 
	D 	 	is the percentage rate per annum payable by the Bank of England to
the Agent on interest bearing Special Deposits.






120











 





	 	 	 
	E

	 	is designed to compensate Lenders for amounts payable under the Fees Rules and is calculated
by the Agent as being the average of the most recent rates of charge supplied by the Reference
Banks to the Agent pursuant to paragraph 7 below and expressed in pounds per £1,000,000.







	5.	 	For the purposes of this Schedule:
	 
	 	 	“Eligible Liabilities” and “Special Deposits” have the meanings given to them from time to
time under or pursuant to the Bank of England Act 1998 or (as may be appropriate) by the
Bank of England.
	 
	 	 	“Fees Rules” means the rules on periodic fees contained in the FSA Supervision Manual
or such other law or regulation as may be in force from time to time in respect of the
payment of fees for the acceptance of deposits; and
	 
	 	 	“Fee Tariffs” means the fee tariffs specified in the Fees Rules under the activity group
A. 1 Deposit Acceptors (ignoring any minimum fee or zero rated fee required pursuant to the
Fees Rules but taking into account any applicable discount rate; and
	 
	 	 	“Tariff Base” has the meaning given to it, and will be calculated in accordance with, the
Fees Rules.
	 
	6.	 	In application of the above formulae, A, B, C and D will be included in the formulae as
percentages (ie 5 per cent will be included in the formula as 5 and not as 0.05). A negative
result obtained by subtracting D from B shall be taken as zero. The resulting figures shall
be rounded to four decimal places.
	 
	7.	 	If requested by the Agent, each Reference Bank shall, as soon as practicable after
publication by the Financial Services Authority, supply to the Agent the rate of charge
payable by that Reference Bank to the Financial Services Authority pursuant to the Fees Rules
in respect of the relevant financial year of the Financial Services Authority (calculated for
this purpose by that Reference Bank as being the average of the Fee Tariffs applicable to that
Reference Bank for that financial year) and expressed in pounds per £1,000,000 of the Tariff
Base of that Reference Bank.
	 
	8.	 	Each Lender shall supply any information required by the Agent for the purpose of calculating
its Additional Cost Rate. In particular, but without limitation, each Lender shall supply the
following information in writing on or prior to the date on which it becomes a Lender:






	 	(a)	 	its jurisdiction of incorporation and the jurisdiction of
its Facility Office; and
	 
	 	(b)	 	any other information that the Agent may reasonably
require for such purpose.






	 	 	Each Lender shall promptly notify the Agent in writing of any change to the information
provided by it pursuant to this paragraph.
	 
	9.	 	The percentages or rates of charge of each Lender for the purpose of A, C and E above shall
be determined by the Agent based upon the information supplied to it pursuant to paragraph 7
above and on the assumption that, unless a Lender notifies the Agent to the contrary, each
Lender’s obligations in relation to cash ratio deposits, Special Deposits and the Fees
Regulations are the same as those of a typical bank from its jurisdiction of incorporation
with a Facility Office in the same jurisdiction as its Facility Office.
	 
	10.	 	The Agent shall have no liability to any person if such determination results in an
Additional Cost Rate which over or under compensates any Lender and shall be entitled to
assume that the




121









 












	 	 	information provided by any Lender pursuant to paragraphs 3 and 7 above is true and
correct in all respects.
	 
	11.	 	The Agent shall distribute the additional amounts received as a result of the Mandatory Cost
to the Lenders on the basis of the Additional Cost Rate for each Lender based on the
information provided by each Lender pursuant to paragraphs 3 and 7 above.
	 
	12.	 	Any determination by the Agent pursuant to this Schedule is in relation to a formula, the
Mandatory Cost, an Additional Cost Rate or any amount payable to a Lender shall, in the
absence of manifest error, be conclusive and binding on all parties to this Agreement.
	 
	13.	 	The Agent may from time to time, after consultation with BMUK and the Lenders, determine and
notify all parties any amendments which are required to be made to this Schedule in order to
comply with any change in law, regulation or any requirements form time to time imposed by the
Bank of England, the Financial Services Authority or the European Central Bank (or, in any
case, any other authority which replaces al or any of its functions) and any such
determination shall, in the absence of manifest error, be conclusive and binding on all
parties.




122









 











SCHEDULE 6




FORM OF TRANSFER CERTIFICATE




	 	 	 
	To:

	 	Bank of America, National Association
	 

	 	Business Capital, Portfolio Management
	 

	 	5 Canada Square
	 

	 	London, E14 5AQ
	 

	 	as Agent for the Beneficiaries






TRANSFER CERTIFICATE



relating to the agreement (as from time to time amended, varied, supplemented, novated or replaced,
the “Credit Agreement”) dated 2 December 2002 and made between (1) Ideal Hardware Limited and Bell
Microproducts Europe Export Limited (as Original Borrowers), (2) BM Europe Partners CV, (3) Bell
Microproducts Europe B.V., (4) Bank of America National Association (as Arranger, Issuer, Swingline
Lender, Agent and Security Trustee) and (5) certain banks and financial institutions (as Lenders).
Terms defined in the Agreement have the same meanings in this Transfer Certificate.





	1	 	[Transferor] (the “Lender”) hereby confirms the accuracy of the summary of its participation
in the Agreement set out in the Schedule below and requests [Transferee] (the “Transferee”) to
accept and procure the transfer to the Transferee of such part of such participation specified
in the Schedule by counter-signing and delivering this Transfer Certificate to the Agent at
its address for the service of notices specified in the Agreement.
	 
	2	 	The Transferee hereby requests the Agent to accept this Transfer Certificate as being
delivered to the Agent pursuant to and for the purposes of clause 28.4 of the Agreement so as
to take effect in accordance with the terms thereof on the business day following the date of
receipt by it of this Transfer Certificate or (if later) on [specify date of transfer] subject
only to the provisions of the Agreement.
	 
	3	 	The Transferee confirms that it has received from the Lender a copy of the Agreement together
with such other documents and information as it has required in connection with this
transaction and that it has not relied and will not hereafter rely on the Lender to check or
enquire on its behalf into the adequacy, accuracy or completeness of any such documents or
information or the reasonableness of any representation, warranty, statement, projection or
assumption contained therein or into the legality, validity, effectiveness, enforceability or
admissibility in evidence of any such documents or information and further agrees that it has
not relied and will not hereafter rely on the Lender to assess or keep under review on its
behalf the business/operations, financial condition, prospects, creditworthiness, status or
affairs of any Borrower or any other Obligor.
	 
	4	 	The Transferee hereby undertakes with the Lender and each of the other parties to the
Agreement that it will perform in accordance with their terms all those obligations which by
the terms of the Agreement will be assumed by it after delivery of this Transfer Certificate
to the Agent and satisfaction of the conditions (if any) subject to which this Transfer
Certificate is expressed to take effect.
	 
	5	 	The Lender makes no representation or warranty and assumes no responsibility with respect to
the legality, validity, effectiveness, adequacy or enforceability of the Finance Documents or
any document delivered pursuant thereto and assumes no responsibility for the financial
condition of any of the Obligors or any other party to the Finance Documents or for the
performance and observance by any of the Obligors or any other such party of any of its
obligations under any of the Finance Documents or any document delivered pursuant thereto and
any and all such conditions and warranties, whether express or implied by law or otherwise,
are hereby excluded.





123









 






	6	 	The Lender gives notice that nothing in this Transfer Certificate or in any of the Finance
Documents (or any document delivered pursuant thereto) shall oblige the Lender (i) to accept a
re-transfer from the Transferee of the whole or any part of its rights and obligations under
the Agreement transferred pursuant to this Transfer Certificate or (ii) to support any losses
directly or indirectly sustained or incurred by the Transferee by reason of the failure by any
of the Obligors or any other party to the Finance Documents (or any document delivered
pursuant thereto) to perform or comply with its obligations under any of the Finance Documents
or any such document. The Transferee hereby acknowledges the absence of any such obligation
as is referred to in (i) and (ii) above.
	 
	7	 	The Transferee confirms that its Facility Office and address for notices for the purposes of
the Agreement are as set out in the Schedule.
	 
	8	 	The Transferee undertakes to pay to the Agent for its own account a transfer fee of £2,000 as
provided in clause 28.7.2 of the Agreement.
	 
	9	 	This Transfer Certificate and the rights and obligations of the parties hereunder shall be
governed by and construed in accordance with English law.




AS WITNESS the hands of the authorised signatories of the parties hereto on the date appearing
below.




124









 








THE SCHEDULE




			
	 	 	 
	Commitment
	 	Portion Transferred






					
	 	 	 	 	 
	Lender’s participation in Loans
	 	Repayment Date
	 	Portion Transferred






	 	 	 
	[Lender]

	 	[Transferee]
	 
	 	 
	By:

	 	By:
	 
	 	 
	Date:

	 	Date:






Administrative Details of Transferee




	 	 	 	 	 
	Facility Office:
	 	 	 	 
	 

	 	 

	 	 
	 
	 	 	 	 
	 

	 	 

	 	 
	 
	 	 	 	 
	 

	 	 

	 	 
	Contact Name:
	 	 	 	 
	 

	 	 

	 	 
	Account for payments:
	 	 	 	 
	 

	 	 

	 	 
	Telephone:
	 	 	 	 
	 

	 	 

	 	 
	Fax:
	 	 	 	 
	 

	 	 

	 	 






125









 





SCHEDULE 7




THE DORMANT COMPANIES AND THE GUARANTORS




	 	 	 
	PART 1
	 	 
	 
	 	 
	THE DORMANT COMPANIES
	 	 
	 
	 	 
	Company
	 	Company Number
	 
	 	 
	Bell Microproducts AB
	 	(in liquidation)
	 
	 	 
	Ideal Hardware Limited
	 	4079671
	 
	 	 
	OpenPSL Holdings Limited
	 	3591250
	 
	 	 
	OpenPSL Limited
	 	3574533
	 
	 	 
	Open Computing Limited
	 	2642536
	 
	 	 
	PART 2
	 	 
	 
	 	 
	THE GUARANTORS
	 	 
	 
	 	 
	THE SECURED GUARANTORS
	 	 
	 
	 	 
	Company
	 	Company Number
	 
	 	 
	Bell Microproducts Limited
	 	03969946
	 
	 	 
	Bell Microproducts Europe Export Limited
	 	03711148
	 
	 	 
	Bell Microproducts Europe BV
	 	4064633
	 
	 	 
	Bell Microproducts (US) Limited
	 	5305904
	 
	 	 
	THE UNSECURED GUARANTORS
	 	 
	 
	 	 
	Bell Microproducts Europe (Holdings) BV
	 	39087200
	 
	 	 
	Bell Europe Partners CV
	 	 
	 
	 	 
	Bell Microproducts S.a.r.l (a company incorporated
under the laws of France)
	 	43474497500013
	 
	 	 
	Bell Microproducts BVBA (a company incorporated
under the laws of Belgium)
	 	0474128872
	 
	 	 
	Bell Microproducts S.r.l (a company incorporated
under the laws of Italy)
	 	13456670150






126









 





SCHEDULE 8




FORM OF ACCESSION NOTICE




	 	 	 
	To:

	 	Bank of America, National Association
	 

	 	Business Capital, Portfolio Management
	 

	 	5 Canada Square
	 

	 	London, E14 5AQ
	 

	 	as Agent for the Beneficiaries
	 
	 	 
	From:

	 	[Group Company] and [BMUK]






Dated:




Dear Sirs



Credit Agreement dated 2 December 2002 and made between, among others, Ideal Hardware Limited and
Bell Microproducts Europe Export Limited (as Original Borrowers), Bank of America, National
Association as (Agent, Arranger, Swingline Lender, Issuer and Security Trustee) and the Lenders
named therein (as amended and restated from time to time, the “Credit Agreement”).





	1	 	[Group Company] agrees to become an [Additional Borrower] [Unsecured Guarantor] and to be
bound by the terms of the Credit Agreement as an [Additional Borrower] [Unsecured Guarantor]
pursuant to clause 3 of the Credit Agreement. [Group Company] is a company duly incorporated
under the laws of [name of relevant jurisdiction].
	 
	2	 	[Group Company’s] administrative details are as follows:





Address:




Fax No.:




Attention:





	3	 	This letter is governed by English law.





[This Accession Notice is entered into as a deed.]




[BMUK] [relevant Group Company]




127









 





SCHEDULE 9




DOCUMENTS TO ACCOMPANY ACCESSION NOTICE OR SUPPLEMENTAL DEED





	1	 	A copy, certified a true copy by a duly authorised officer of the proposed [Additional
Borrower] [Unsecured Guarantor] [Charging Company], of the constitutive documents of such
proposed [Additional Borrower] [Unsecured Guarantor] [Charging Company].
	 
	2	 	A copy, certified a true copy by a duly authorised officer of the proposed [Additional
Borrower] [Unsecured Guarantor] [Charging Company], of a board resolution of such proposed
[Additional Borrower] [Unsecured Guarantor] [Charging Company] approving the execution and
delivery of a [Accession Notice] [Supplemental Deed], the accession of such proposed
[Additional Borrower] [Unsecured Guarantor] [Charging Company] to [this Agreement] [the
Debenture] and the performance of its obligations under the Finance Documents and authorising
a person or persons (specified by name or office) on behalf of such proposed [Additional
Borrower] [Unsecured Guarantor] [Charging Company] to execute and deliver such [Accession
Notice] [Supplemental Deed], any other Finance Document and any other documents to be
delivered by such proposed [Additional Borrower] [Unsecured Guarantor] [Charging Company]
pursuant hereto or thereto.
	 
	3	 	A certificate of a duly authorised officer of the proposed [Additional Borrower] [Unsecured
Guarantor] [Charging Company] setting out the names and signatures of the person or persons
mentioned in the resolution referred to in paragraph 2 above.
	 
	4	 	A certificate addressed to the Agent signed by two authorised signatories of the proposed
[Additional Borrower] [Unsecured Guarantor] [Charging Company] stating that the execution by
such proposed [Additional Borrower] [Unsecured Guarantor] [Charging Company] of the [Accession
Notice] [Supplemental Deed] and the performance of such proposed [Additional Borrower]
[Unsecured Guarantor] [Charging Company] of its obligations hereunder and thereunder are
within its corporate powers, have been duly approved by all necessary corporate action and
will not cause any limit or restriction on any of its powers (whether imposed by law, decree,
rule, regulation, its constitutive documents or agreement or otherwise) or on the right or
ability of its directors to execute such powers, to be exceeded or breached.
	 
	5	 	A copy of its latest audited financial statements.
	 
	6	 	Such legal opinion(s) of counsel to the Agent as the Agent may require, in a form
satisfactory to the Agent.
	 
	7	 	[In connection with the acquisition of any company where such company or any of its
Subsidiaries accedes as a Charging Company to the Debenture or otherwise executes a Security
Document (such person thus becoming an “Obligor”):
	 
	7.1	 	a certificate addressed to the Agent from the Auditors confirming in the context of section
155(2) Companies Act 1985 that:






	 	7.1.1	 	in their opinion such Obligor had positive net assets as defined in
section 154(2) Companies Act 1985;
	 
	 	7.1.2	 	they are not aware of anything to indicate that the decision of the
directors of such Obligor not to make a provision in relation to the giving of
financial assistance represented by the execution of each such Security Document to
which it is a party has not been made on fair and reasonable grounds; and




128









 












	 	7.1.3	 	the giving of such financial assistance by such Obligor would not cause
those net assets to be reduced,






	7.2	 	in each such case dated as at the date of the giving of such financial assistance;
	 
	7.3	 	a statutory declaration by all of the directors of such Obligor as required by Section 155(6)
Companies Act 1985 in relation to such financial assistance, such statutory declaration to be
in the prescribed form and having attached thereto the report addressed by the Auditors
complying with the provisions of Section 156(4) Companies Act 1985;
	 
	7.4	 	a copy, certified by a duly authorised officer of such Obligor as being a true copy, of the
resolution of its board of directors approving the matters and things required to be done by
it pursuant to this paragraph 8 and in particular the giving of such financial assistance.]*
	 
	8	 	Such other documents or evidence relating to such proposed [Additional Borrower] [Unsecured
Guarantor] [Charging Company] as the Agent may reasonably require.







 




			
	*	 	This paragraph only applies where a company being acquired (or one or more of its Subsidiaries)
is acceding to the Debenture or otherwise executing a Security Document to secure borrowings raised
for its acquisition.




129









 










SCHEDULE 10




THE MATERIAL CONTRACTS




	 	 	 	 	 
	Description of Agreement	 	Date	 	Parties
	Microsoft OEM Distributor
Channel Agreement

	 	1 July 2007
	 	(1) BMUK (2) Microsoft
Ireland Operations Ltd
	 
	 	 	 	 
	Europe Authorised
Distributor Agreement

	 	11 April 2006
	 	(1) BMUK (2) Seagate
Technology
International
	 
	 	 	 	 
	International Distributor
Agreement

	 	27 December 2002
	 	(1) Bell Microproducts
Inc (2) Western
Digital Technologies
Inc
	 
	 	 	 	 
	Authorised Distributor
Agreement

	 	7 June 2005
	 	(1) BMUK (2) Symantec
Limited
	 
	 	 	 	 
	Logistic Service Partner
Agreement

	 	4 January 2007
	 	(1) BMUK (2)
Hewlett-Packard Ltd.
	 
	 	 	 	 
	Channel Development Partner
Agreement

	 	4 January 2007
	 	(1) BMUK (2)
Hewlett-Packard Ltd.
	 
	 	 	 	 
	Value Added International
Distribution Agreement

	 	4 October 2004
	 	(1) BMUK (2) McAfee
Ireland Limited
	 
	 	 	 	 
	IBM Business Partner
Agreement

	 	5 February 2003
	 	(1) BMUK (2) IBM United
Kingdom Limited






130









 






	 	 	 	 	 
	THE ORIGINAL BORROWERS	 	 
	 
	 	 	 	 
	SIGNED for and on behalf of	 	)
	IDEAL HARDWARE LIMITED1	 	)
	by:
	 	 	 	 
	 
	 	 	 	 
	Address:
	 	Cox Lane	 	 
	 
	 	Chessington	 	 
	 
	 	Surrey KT9 1SJ	 	 
	Fax:
	 	020 8286 5588	 	 
	Attention: Nick Lee/Helen Hancock	 	 
	 
	 	 	 	 
	SIGNED for and on behalf of	 	)
	BELL MICROPRODUCTS EUROPE	 	)
	EXPORT LIMITED	 	)
	by:
	 	 	 	 
	 
	 	 	 	 
	Address:
	 	Cox Lane	 	 
	 
	 	Chessington	 	 
	 
	 	Surrey KT9 1SJ	 	 
	Fax:
	 	020 8286 5588	 	 
	Attention: Nick Lee/Helen Hancock	 	 
	 
	 	 	 	 
	THE DUTCH OBLIGORS	 	 
	 
	 	 	 	 
	SIGNED for and on behalf of	 	)
	BM EUROPE PARTNERS C.V.	 	)
	by:
	 	 	 	 
	 
	 	 	 	 
	Address:
	 	c/o Cox Lane	 	 
	 
	 	Chessington	 	 
	 
	 	Surrey KT9 1SJ	 	 
	Fax:
	 	020 8286 5588	 	 
	Attention: Nick Lee/Helen Hancock	 	 
	 
	 	 	 	 
	SIGNED for and on behalf of	 	)
	BELL MICROPRODUCTS	 	)
	EUROPE BV	 	)
	by:
	 	 	 	 
	 
	 	 	 	 
	Address:
	 	c/o Fountain Court	 	 
	 
	 	Cox Lane	 	 
	 
	 	Chessington	 	 
	 
	 	Surrey KT9 1SJ	 	 
	Fax:
	 	020 8286 5588	 	 
	Attention: Nick Lee/Helen Hancock	 	 








 




			
	1	 	Now called “Bell Microproducts Limited”




131









 










	 	 	 	 	 
	THE AGENT	 	 
	 
	 	 	 	 
	SIGNED for and on behalf of	 	)
	BANK OF AMERICA,	 	)
	NATIONAL ASSOCIATION	 	)
	by:
	 	 	 	 
	 
	 	 	 	 
	Address:
	 	5 Canada Square	 	 
	 
	 	London, E14 5AQ	 	 
	Fax:
	 	020 7174 6400	 	 
	Attention: Business Capital, Portfolio Management
	 
	 	 	 	 
	THE ARRANGER	 	 
	 
	 	 	 	 
	SIGNED for and on behalf of	 	)
	BANK OF AMERICA,	 	)
	NATIONAL ASSOCIATION	 	)
	by:
	 	 	 	 
	 
	 	 	 	 
	Address:
	 	5 Canada Square	 	 
	 
	 	London, E14 5AQ	 	 
	Fax:
	 	020 7174 6400	 	 
	Attention: Business Capital, Portfolio Management
	 
	 	 	 	 
	THE SECURITY TRUSTEE	 	 
	 
	 	 	 	 
	SIGNED for and on behalf of	 	)
	BANK OF AMERICA,	 	)
	NATIONAL ASSOCIATION	 	)
	by:
	 	 	 	 
	 
	 	 	 	 
	Address:
	 	5 Canada Square	 	 
	 
	 	London, E14 5AQ	 	 
	Fax:
	 	020 7174 6400	 	 
	Attention: Business Capital, Portfolio Management
	 
	 	 	 	 
	THE SWINGLINE LENDER	 	 
	 
	 	 	 	 
	SIGNED for and on behalf of	 	)
	BANK OF AMERICA,	 	)
	NATIONAL ASSOCIATION	 	)
	by:
	 	 	 	 
	 
	 	 	 	 
	Address:
	 	5 Canada Square	 	 
	 
	 	London, E14 5AQ	 	 
	Fax:
	 	020 7174 6400	 	 
	Attention: Business Capital, Portfolio Management






132









 






	 	 	 	 	 
	THE ISSUER	 	 
	 
	 	 	 	 
	SIGNED for and on behalf of	 	)
	BANK OF AMERICA,	 	)
	NATIONAL ASSOCIATION	 	)
	by:
	 	 	 	 
	 
	 	 	 	 
	Address:
	 	5 Canada Square	 	 
	 
	 	London, E14 5AQ	 	 
	Fax:
	 	020 7174 6400	 	 
	Attention: Business Capital, Portfolio Management
	 
	 	 	 	 
	THE LENDERS	 	 
	 
	 	 	 	 
	SIGNED for and on behalf of	 	)
	BANK OF AMERICA,	 	)
	NATIONAL ASSOCIATION	 	)
	by:
	 	 	 	 
	 
	 	 	 	 
	Address:
	 	5 Canada Square	 	 
	 
	 	London, E14 5AQ	 	 
	Fax:
	 	020 7174 6400	 	 
	Attention: Business Capital, Portfolio Management







133