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Exhibit 4.9


 




 





Execution Copy


 


SPIRENT plc


 


 












 


AMENDED AND RESTATED


NOTE PURCHASE AGREEMENT


 












 


 


Dated March 11, 2003


 


US$10,000,000


Amended and Restated Series A Senior Notes
Due November 23, 2006


 


US$63,406,000


Amended and Restated Series B Senior Notes Due
November 23, 2009


 


US$115,000,000


Amended and Restated Series C Senior Notes
Due November 23, 2009


 


US$29,594,000


Amended and Restated Series D Senior Notes
Due November 23, 2009


 


Bingham McCutchen LLP


London


 




 




















 


TABLE OF CONTENTS


 


	
  1.

  	
  PRELIMINARY STATEMENT.

  
	
   

  	
   

  	
   

  	
   

  
	
  2.

  	
  AMENDMENT AND RESTATEMENT; OTHER
  ARRANGEMENTS.

  
	
   

  	
   

  	
   

  
	
   

  	
  2.1.

  	
  Amendment and Restatement of Existing Note Purchase Agreements and
  Existing Notes.

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  2.2.

  	
  Guarantees.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  3.

  	
  EFFECTIVENESS OF RESTRUCTURING TRANSACTION.

  
	
   

  	
   

  	
   

  	
   

  
	
  4.

  	
  CONDITIONS TO THE EFFECTIVE DATE.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  4.1.

  	
  Representations and Warranties.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  4.2.

  	
  Performance; No Default.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  4.3.

  	
  Certificates of Compliance.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  4.4.

  	
  Opinions of Counsel.

  	
   

  



 


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  4.5.

  	
  Subsidiary Guarantees.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  4.6.

  	
  Purchase Permitted by Applicable Law.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  4.7.

  	
  Prepayment of Notes.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  4.8.

  	
  Payment of Fees and Expenses.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  4.9.

  	
  Bank Facility Agreement.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  4.10.

  	
  Project Schultz.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  4.11.

  	
  Accountants’ Report.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  4.12.

  	
  Accountants’ Engagement.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  4.13.

  	
  Consents, Authorizations, Licenses and Approvals.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  4.14.

  	
  Miscellaneous.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  4.15.

  	
  Proceedings and Documents.

  	
   

  



 


3

















 


	
  5.

  	
  REPRESENTATIONS AND WARRANTIES OF THE COMPANY.

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  5.1.

  	
  Organization; Power and Authority.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  5.2.

  	
  Authorization, etc.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  5.3.

  	
  Disclosure, etc.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  5.4.

  	
  Organization and Ownership of Shares of Subsidiaries; Affiliates.

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  5.5.

  	
  Financial Statements.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  5.6.

  	
  Compliance with Laws, Other Instruments, etc.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  5.7.

  	
  Governmental Authorizations, etc.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  5.8.

  	
  Litigation; Observance of Agreements, Statutes and Orders.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  5.9.

  	
  Taxes.

  	
   

  



 


4

















 


	
   

  	
  5.10.

  	
  Title to Property; Leases.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  5.11.

  	
  Licenses, Permits, etc.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  5.12.

  	
  Compliance with ERISA.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  5.13.

  	
  Existing Financial Indebtedness; Future
  Liens.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  5.14.

  	
  Foreign Assets Control Regulations, etc.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  5.15.

  	
  Status under Certain Statutes.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  5.16.

  	
  Environmental Matters.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  5.18.

  	
  Withholding Taxes.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  5.19.

  	
  Solvency.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  5.20.

  	
  No Event of Default.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  6.

  	
  REPRESENTATIONS OF THE NOTEHOLDERS.

  



 


5

















 


	
  7.

  	
  INFORMATION AS TO THE COMPANY.

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  7.1.

  	
  Financial and Business Information.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  7.2.

  	
  Officer’s Certificates, etc.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  7.3.

  	
  Inspection.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  7.4.

  	
  Limitation on Disclosure.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  8.

  	
  PAYMENTS.

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  8.1.

  	
  Maturity Dates.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  8.2.

  	
  Interest.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  8.3.

  	
  Prepayments with Make-Whole Amount.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  8.4.

  	
  Allocation of Partial Optional Prepayments.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  8.5.

  	
  Maturity; Surrender, etc.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  8.6.

  	
  Purchase of Notes.

  	
   

  



 


6

















 


	
   

  	
  8.7.

  	
  Optional Prepayment of Notes for Tax Reasons.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  8.8.

  	
  Change in Control.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  8.9.

  	
  Make-Whole Amount; Modified Make-Whole
  Amount.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  9.

  	
  AFFIRMATIVE COVENANTS.

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  9.1.

  	
  Compliance with Law.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  9.2.

  	
  Insurance.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  9.3.

  	
  Maintenance of Properties.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  9.4.

  	
  Payment of Taxes and Claims.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  9.5.

  	
  Corporate Existence, etc.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  9.6.

  	
  Pari Passu Ranking.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  9.7.

  	
  Maintenance of Ownership of Guarantors.

  	
   

  



 


7

















 


	
   

  	
  9.8.

  	
  Committed External Financing.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  9.9.

  	
  Executive Order 13224 of September 23,
  2001.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  9.10.

  	
  ERISA.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  9.11.

  	
  Environmental Laws.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  10.

  	
  NEGATIVE COVENANTS.

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  10.1.

  	
  Transactions with Affiliates.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  10.2.

  	
  Merger, Consolidation, etc.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  10.3.

  	
  Liens, etc.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  10.4.

  	
  Sale of Assets, etc.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  10.5.

  	
  Consolidated Net Worth.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  10.6.

  	
  Consolidated Net Debt; Interest Coverage.

  	
   

  



 


8

















 


	
   

  	
  10.7.

  	
  Subsidiary Debt; Subsidiary Guarantees.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  10.8.

  	
  No Restrictive Agreements.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  10.9.

  	
  Business of the Company and its
  Subsidiaries.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  10.10.

  	
  Distributions.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  10.11.

  	
  Acquisitions.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  10.12.

  	
  Maintenance of Most Favored Lender Status.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  11.

  	
  EVENTS OF DEFAULT.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  12.

  	
  REMEDIES ON DEFAULT, ETC.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  12.1.

  	
  Acceleration.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  12.2.

  	
  Other Remedies.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  12.3.

  	
  Rescission.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  12.4.

  	
  No Waivers or Election of Remedies,
  Expenses, etc.

  	
   

  



 


9

















 


	
  13.

  	
  REGISTRATION; EXCHANGE; SUBSTITUTION OF
  NOTES.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  13.1.

  	
  Registration of Notes.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  13.2.

  	
  Transfer and Exchange of Notes.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  13.3.

  	
  Replacement of Notes.

  	
   

  
	
   

  	
   

  	
   

  	
   

  



 


10

















 


	
  14.

  	
  PAYMENTS ON NOTES.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  14.1.

  	
  Place of Payment.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  14.2.

  	
  Home Office Payment.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  14.3.

  	
  Currency of Payment.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  15.

  	
  EXPENSES, ETC.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  15.1.

  	
  Transaction Expenses.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  15.2.

  	
  Survival.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  16.

  	
  SURVIVAL OF REPRESENTATIONS AND WARRANTIES;
  ENTIRE AGREEMENT.

  
	
   

  	
   

  	
   

  	
   

  
	
  17.

  	
  AMENDMENT AND WAIVER.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  17.1.

  	
  Requirements.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  17.2.

  	
  Solicitation of Holders of Notes.

  	
   

  



 


11

















 


	
   

  	
  17.3.

  	
  Binding Effect, etc.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  17.4.

  	
  Notes held by the Company, etc.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  18.

  	
  NOTICES.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  19.

  	
  REPRODUCTION OF DOCUMENTS.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  20.

  	
  CONFIDENTIAL INFORMATION.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  21.

  	
  INTENTIONALLY OMITTED.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  22.

  	
  TAX INDEMNIFICATION.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  22.1.

  	
  Payments Free and Clear; Gross-Up of
  Payments Subject to Taxes.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  22.2.

  	
  Tax Refunds.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  22.3.

  	
  Additional Tax Indemnity for Outstanding
  Company Notes.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  22.4.

  	
  Survival of Obligations.

  	
   

  



 


12

















 


	
  23.

  	
  MISCELLANEOUS.

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  23.1.

  	
  Successors and Assigns.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  23.2.

  	
  Payments Due on Non-Business Days.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  23.3.

  	
  Severability.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  23.4.

  	
  Construction.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  23.5.

  	
  Counterparts.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  23.6.

  	
  Jurisdiction; Service of Process.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  23.7.

  	
  Governing Law.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  23.8.

  	
  Accounting Principles.

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  SCHEDULE A

  	
  —

  	
  Information Relating to Noteholders

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  SCHEDULE B

  	
  —

  	
  Defined Terms

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  SCHEDULE B.1

  	
  —

  	
  Disposals of Certain Real Property

  
						



 


13

















 


	
   

  	
  SCHEDULE 2.2 

  	
  —

  	
  Original Guarantors

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  SCHEDULE 5.3 

  	
  —

  	
  Disclosure Materials

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  SCHEDULE 5.4 

  	
  —

  	
  Subsidiaries; Affiliates, etc.

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  SCHEDULE 5.5 

  	
  —

  	
  Financial Statements

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  SCHEDULE 5.8 

  	
  —

  	
  Litigation; Observance of Agreements,
  Statutes and Orders

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  SCHEDULE 5.13 

  	
  —

  	
  Financial Indebtedness and Liens as of
  December 31, 2002

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  SCHEDULE 10.10

  	
  —

  	
  Certain Subsidiary Guarantors

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  SCHEDULE 10.11

  	
  —

  	
  Deferred Consideration Obligations

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  EXHIBIT 2.1(a)

  	
  —

  	
  Form of Amended and Restated Series A
  Senior Note due November 23, 2006

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  EXHIBIT 2.1(b)

  	
  —

  	
  Form of Amended and Restated Series B
  Senior Note due November 23, 2009

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  EXHIBIT 2.1(c)

  	
  —

  	
  Form of Amended and Restated Series C Senior
  Note due November 23, 2009

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  EXHIBIT 2.1(d)

  	
  —

  	
  Form of Amended and Restated Series D
  Senior Note due November 23, 2009

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  EXHIBIT 4.5

  	
  —

  	
  Forms of Subsidiary Guarantee (Parts A, B, C and D)

  



 


14

















 


	
   

  	
  EXHIBIT 4.9

  	
  —

  	
  Banks’ Term Sheet

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  EXHIBIT B

  	
  —

  	
  Form of
  Normalization Certificate

  



 


15

















 


SPIRENT plc


Spirent House


Crawley Business Quarter


Fleming Way


Crawley


West Sussex RH10 9QL


England


 












 


AMENDED AND RESTATED

NOTE PURCHASE AGREEMENT


 












 


US$10,000,000


Amended and Restated Series A Senior Notes
Due November 23, 2006


 


US$63,406,000


Amended and Restated Series B Senior Notes
Due November 23, 2009


 


US$115,000,000


Amended and Restated Series C Senior Notes
Due November 23, 2009


 


US$29,594,000


Amended and Restated Series D Senior Notes
Due November 23, 2009


 


 


March 11, 2003


 


To Each of the Noteholders Listed in

the Attached Schedule A


 


16

















 


Ladies and Gentlemen:


 


SPIRENT plc (formerly known as Bowthorpe plc), a limited company organized and existing under the
laws of England and Wales with registered number 470893 (the “Company”,
which expression shall include its successors and assigns permitted pursuant to
this Agreement), agrees with you as follows:


 


1.                                      PRELIMINARY STATEMENT.


 


1.1                               Pursuant to those certain Note Purchase Agreements,
dated November 23, 1999 (collectively, as amended pursuant to an Amendment
Agreement dated November 14, 2000, the “Existing Note Purchase Agreements”), among the Company and the purchasers named in Schedule A thereto, the
Company heretofore issued (a) US$10,000,000 principal amount of its 7.94%
Series A Senior Notes due November 23, 2006 (including any amendments,
restatements or modifications from time to time, the “Existing Series A Notes”,  such term to
include any such notes issued in substitution therefor pursuant to Section 13
of the Existing Note Purchase Agreements), (b) US$63,406,000 principal amount
of its 8.06% Series B Senior Notes due November 23, 2009 (including any
amendments, restatements or modifications from time to time, the “Existing Series B Notes”, such term to include any such notes issued in subtitution
therefor pursuant to Section 13 of the Existing Note Purchase Agreements), (c)
US$115,000,000 principal amount of its 8.16% Series C Senior Notes due November
23, 2009 (including any amendments, restatements or modifications from time to
time, the “Existing Series C Notes”,
such term to include any such notes issued
in substitution therefor pursuant to Section 13 of the Existing Note Purchase
Agreements), and (d) US$29,594,000 principal amount of its Fixed Rate Series D
Senior Notes due November 23, 2009 (including any amendments, restatements or
modifications from time to time, the “Existing Series D Notes”, such
term to include any such notes issued in substitution therefor pursuant
to Section 13 of the Existing Note Purchase Agreements)  (the Existing Series A Notes , the Existing
Series B Notes, the Existing Series C Notes


 


17

















 


and the Existing Series D Notes are referred
to herein, collectively, as the “Existing Notes”), and are substantially in the forms set out in Exhibit 1.1, Exhibit
1.2, Exhibit 1.3 and Exhibit 1.4 to the Existing Note Purchase Agreements,
respectively. Certain capitalized terms used in this Agreement are defined in
Schedule B; all accounting terms used herein which are not expressly defined in
this Agreement have the meanings given to them in accordance with UK GAAP;
references to a “Schedule”
or an “Exhibit” are , unless
otherwise specified, references to a Schedule or Exhibit attached to this
Agreement; references to Sections are, unless otherwise specified, references
to Sections of this Agreement.


 


1.2.                            The Company has requested the amendment and restatement, in their
entirety, of the Existing Note Purchase Agreements and the Existing Notes, as
provided for herein.


 


1.3                               Subject to Section 1.6 hereof, until each of the
conditions precedent set forth in Section 4 of this Agreement shall have been
satisfied and until the Effective Date, each of the terms and conditions of the
Existing Note Purchase Agreements and of the Existing Notes shall remain in
full force and effect and nothing contained herein (without prejudice to
Section 1.4 below) shall in any way prejudice, impair or affect any rights or
remedies of the Noteholders under the Existing Note Purchase Agreements or the
Existing Notes.


 


1.4                               The Company hereby acknowledges and agrees that until
each of the conditions precedent set forth in Section 4 of this Agreement
(particularly the condition precedent set forth in Section 4.7(a) requiring the
payment to the Noteholders of the sum of US$93,368,773) shall have been
satisfied and until the Effective Date, neither it nor any of its Subsidiaries
will make any payments or repayments whatsoever to the Banks or in connection
with the Bank Facility Agreement, except for payments made in the ordinary
course of business consistent with past practices (including the payment of an
amendment fee, fees payable to advisers and any other fees and expenses, in
each case, as set forth in the Bank Facility Agreement).


 


18

















 


1.5                               Subject to satisfaction of the conditions precedent
set forth in Section 4 of this Agreement, the Company and the Noteholders, by
their execution of this Agreement, hereby agree and consent to the amendment
and restatement in its entirety of the Existing Note Purchase Agreements by
this Agreement, and upon the satisfaction of such conditions precedent, the
Existing Note Purchase Agreements shall be deemed so amended and restated.  Notwithstanding the foregoing, the
representations and warranties of the Company set forth in Section 5 of the
Existing Note Purchase Agreements and of the Noteholders in Section 6 of the
Existing Note Purchase Agreements shall be deemed to survive the amendment and
restatement of the Existing Note Purchase Agreements, and the representations
and warranties of the Company set forth in Section 5 of this Agreement shall be
deemed to be additional representations and warranties of the Company made as
of the date of this Agreement.


 


1.6                               For the avoidance of doubt, the Noteholders hereby
consent (subject to Section 1.7) to the execution of the Project Schultz
Documentation and due consummation on or prior to the Effective Date of the
Project Schultz Transaction in accordance with the terms of the Project Schultz
Documentation on the condition that the Company makes the payments described in
Section 4.7(a) within three Business Days following receipt by the Company of
the consideration payable by the buyers under the Project Schultz Transaction
(and in any event, on or prior to any payment or repayment whatsoever to the
Banks or in connection with the Bank Facility Agreement, except for payments
made in the ordinary course of business consistent with past practices
(including the payment of an amendment fee, fees payable to advisers and any
other fees and expenses, in each case, as set forth in the Bank Facility
Agreement).  The Company specifically
acknowledges that the Noteholders do not consent to or waive, and fully reserve
all their rights with respect to, any Default or Event of Default other than
those relating to Section 10.1 of the Existing Note Purchase Agreements and of
this Agreement in connection with the Project Schultz Transaction that may have
occurred or may occur as a result of the Project Schultz Transaction.  Furthermore, the Company and the Noteholders
agree that non-compliance by the Company with the condition to make the
payments described in Section 4.7(a) as set out in this Section 1.6 shall
constitute an immediate Event of Default under


 


19

















 


the Existing Note Purchase Agreements.


 


1.7                               This Agreement shall automatically terminate if the
Project Schultz Transaction has not been consummated by 5:00 p.m. New York time
on May 15, 2003 and the Existing Note Purchase Agreements shall be reinstated
as of such date.  In the event of such
termination, this Agreement, including, without limitation, Section 1.6 hereof,
shall become void and have no effect.


 


2.                                      AMENDMENT AND RESTATEMENT; OTHER ARRANGEMENTS.


 


2.1.                            Amendment
and Restatement of Existing Note Purchase Agreements
and Existing Notes.


 


(a)
Amendment and Restatement of Existing Note Purchase Agreements and Existing
Notes.                     The parties hereto agree that on the Effective Date
(i) the Existing Note Purchase Agreements (including the schedules and exhibits
thereto) will be hereby amended and restated in their entirety by this
Agreement, (ii) the form of each Existing Series A Note will be hereby amended
and restated in its entirety as set forth in Exhibit 2.1(a) (the “Series A Notes”), (iii) the form of each Existing Series B Note will be hereby amended
and restated in its entirety as set forth in Exhibit 2.1(b) (the “Series B Notes”), (iv) the form of each Existing Series C Note will be hereby amended
and restated in its entirety as set forth in Exhibit 2.1(c) (the “Series C Notes”) and (v) the form of each Existing Series D Note will be hereby
amended and restated in its entirety as set forth in Exhibit 2.1(d) (the “Series D Notes”), (each such amendment and restatement, together with the other
transactions contemplated by this Agreement, being referred to herein,
collectively, as the “Restructuring
Transaction”).  The Existing Notes, as amended and restated
pursuant to this Agreement or as further amended, restated or otherwise
modified from time to time, are hereinafter referred to as the “Notes”.


 


(b)
Delivery of Amended and Restated Notes. 
The Existing Notes


 


20

















 


outstanding on the Effective Date are hereby,
without any further actions being required on the part of the Noteholders or on
the part of any other Person, deemed to be automatically amended to conform to,
and have the terms provided in, the form of Notes set forth in Exhibit 2.1(a)
with respect to the Existing Series A Notes, (ii) Exhibit 2.1(b) with respect
to the Existing Series B Notes, (iii) Exhibit 2.1(c) with respect to the
Existing Series C Notes, and (iv) Exhibit 2.1(d) with respect to the Existing
Series D Notes (including, without limitation, in each case all terms requiring
the payment of interest at increased rates (as provided therein)).  The Existing Notes shall be and are entitled
to all of the rights and benefits provided therefor in this Agreement.  Upon the request of any holder of a Note
made in accordance with Section 13.2 of this Agreement, the Company shall
deliver, pursuant to Section 13.2 of this Agreement, a new Note, against
surrender (subject to Section 13.3 of this Agreement) of such Noteholder’s
Existing Note.


 


2.2.                            Guarantees.


 


Payment by the Company of all amounts due
with respect to the Notes and performance by the Company of its obligations
under this Agreement will be guaranteed by certain of the Company’s
Subsidiaries as described in Schedule 2.2 (collectively, the “Original Guarantors”) pursuant to the guarantee agreements, each dated
the Effective Date and substantially in the forms set out in Exhibit 4.5
(collectively, the “Subsidiary
Guarantees”).  The Original Guarantors and any other Person
that becomes an additional Subsidiary Guarantor in accordance with Section 10.7
are hereinafter referred to, collectively, as the “Guarantors”.  The Subsidiary Guarantees and any additional
Subsidiary Guarantees entered into pursuant to Section 10.7 are hereinafter
referred to, collectively, as the “Guarantees”.


 


3.                                      EFFECTIVENESS OF RESTRUCTURING TRANSACTION.


 


Without prejudice to Section 1.6 hereof, the
Restructuring Transaction and


 


21

















 


this Agreement shall take effect (if at all)
from the date on which all of the conditions precedent set forth in Section 4
are satisfied or otherwise waived in writing (the “Effective Date”).  The failure of the Company
to satisfy any of the conditions precedent set forth in Section 4 shall not
operate to waive any of the Noteholders’ rights against the Company under the
Existing Note Purchase Agreements or the Existing Notes and shall not rescind
the Company’s obligations under Section 1.4 of this Agreement.  On the Effective Date, the Company agrees to
execute and deliver to each Noteholder pursuant to Section 13.2 of this
Agreement, upon the request of any Noteholder in accordance with Section 13.2
of this Agreement, Notes in the aggregate principal amount specified below such
Noteholder’s name in Schedule A, against such Noteholder’s delivery to the
Company of the Existing Notes held by such Noteholder (subject to Section 13.3
of this Agreement) in an equal aggregate principal amount for cancellation by
the Company.  Without prejudice to Section
2.1(b), all amounts due and owing under, and evidenced by, the Existing Notes
as of the Effective Date shall continue to be outstanding under, and after the
Effective Date shall be evidenced by, the Notes, and shall be governed by the
terms hereof and the Existing Notes shall be and are entitled to all of the
rights and benefits provided therefor in this Agreement.


 


4.                                      CONDITIONS TO THE EFFECTIVE DATE.


 


The Effective Date shall occur when each of
the following conditions precedent set forth in this Section 4 shall have been
satisfied in full or otherwise waived in writing.


 


4.1.                            Representations and Warranties.


 


The representations and warranties of the
Company in this Agreement, and of each Guarantor in Section 2 of the Subsidiary
Guarantee to which it is a party, shall be true and correct when made and on
the Effective Date (except for the representation and warranty set forth in
Section 5.9 as to charges, accruals and reserves on the books of the Company
and its Subsidiaries only and the representations and warranties set forth in
Section 5.18, which representations


 


22

















 


and warranties shall be made at the date
hereof).


 


4.2.                            Performance; No Default.


 


The Company shall have performed and complied
with all agreements and conditions contained in the Existing Note Purchase
Agreements required to be performed or complied with by it prior to or at the
Effective Date.  Immediately after
giving effect to the Restructuring Transaction, no Default or Event of Default
shall have occurred and be continuing.


 


4.3.                            Certificates of Compliance.


 


(a)                                          Officer’s Certificates.                The Company shall
have delivered to each Noteholder an Officer’s Certificate, dated the Effective
Date, certifying that the conditions specified in Sections 4.1 and 4.2 have
been fulfilled.


 


(b)                                          Secretary’s Certificates.               The Company and
each Original Guarantor shall have delivered to each Noteholder copies,
certified as at the Effective Date by a secretary, deputy or assistant
secretary (or an equivalent Person under applicable law) of such Person as
being true, complete and up-to-date and in full force and effect on the date of
this Agreement and confirming the same have not been superseded, amended, or
revoked and remain in full force and effect on the Effective Date: (i) of the
constitutional documents of such Person, (ii) of the resolutions of the board
of directors, and/or the shareholders and/or the supervisory board (as
applicable) of such Person in each case authorizing the execution, delivery and
performance of the Financing Documents to which such Person is a party and the
terms and conditions thereof and authorizing a Person or Persons to sign each
Financing Document and any documents to be delivered by such Person pursuant
thereto, (iii) of a certificate setting out the names and signatures of the
Persons authorized to sign, on behalf of such Person, each Financing Document
to which such Person is or is to be a party and (iv) a certificate of an
authorized signatory of the Company certifying solvency.


 


23

















 


4.4.                            Opinions of Counsel.


 


Each Noteholder shall have received opinions,
each in form, scope and substance reasonably satisfactory to it, dated the
Effective Date:


 


(a)                               from
Linklaters, English counsel for the Company and the Subsidiaries providing
Subsidiary Guarantees, as to matters of English law;


 


(b)                               from
Debevoise & Plimpton, U.S. counsel for the Company and the Subsidiaries
providing Subsidiary Guarantees, as to matters of New York law;


 


(c)                                from
Goulston & Storrs, U.S. counsel for the Subsidiaries providing Subsidiary
Guarantees, as to matters of Delaware law;


 


(d)                               from
Fraser Milner Casgrain LLP, Canadian counsel for the Subsidiaries providing
Subsidiary Guarantees, as to matters of Canadian federal and provincial law;


 


(e)                                from
Olsens, Guernsey counsel for the Subsidiaries providing Subsidiary Guarantees,
as to matters of Guernsey law; and


 


(f)                                   from
Bingham McCutchen LLP, the Noteholders’ special counsel, in connection with the
Restructuring Transaction,


 


in each case, covering such matters
incidental to the Restructuring Transaction as such Noteholder may reasonably
request.  Each of the Company and the
Subsidiaries providing Subsidiary Guarantees hereby instructs each of the
counsel named in clauses (a), (b), (c) and (d) above to deliver an opinion in
form, scope and substance satisfactory to each Noteholder on the Effective
Date.


 


24

















 


4.5.                            Subsidiary Guarantees.


 


Each Original Guarantor shall have executed
and delivered a Subsidiary Guarantee substantially in the form, scope and
substance of the guarantee agreement attached as Exhibit 4.5 (Parts A, B, C and
D) with such modifications as may be necessary to reflect the Restructuring
Transaction and any changes required or deemed advisable by local counsel.


 


4.6.                            Purchase Permitted by Applicable Law.


 


On the Effective Date, the Restructuring
Transaction, on the terms and conditions hereby provided, shall (a) be
permitted by the laws and regulations of each jurisdiction to which each
Noteholder is subject, without recourse to provisions (such as Section
1405(a)(8) of the New York Insurance Law) permitting limited investments by
insurance companies without restriction as to the character of the particular
investment, (b) not violate any applicable law or regulation (including without
limitation Regulation T, U or X of the Board of Governors of the United States
Federal Reserve System), and (c) not subject such Noteholder to any tax,
penalty or liability under or pursuant to any applicable law or regulation,
which law or regulation was not in effect on the date hereof.  If requested by such Noteholder, it shall
have received an Officer’s Certificate of the Company or any Subsidiary
certifying as to such matters of fact as any Noteholder may reasonably specify
to enable it to establish compliance with this condition.


 


4.7.                            Prepayment of Notes.


 


(a) On or prior to the Effective Date, the
Company will pay the sum of US$93,368,773 (the date on which such payment is
made shall be hereinafter referred to as the “Project Schultz Prepayment Date”), to be allocated among the Noteholders pursuant to a
letter agreement between the Company and the Noteholders dated on or prior to
the Effective Date, to a prepayment of the principal amount of the Existing
Notes then outstanding plus the Make-Whole Amount determined for the prepayment
date with respect to such principal amount as provided in Section 8.2 and


 


25

















 


Section 8.3 of the Existing Note Purchase
Agreements respectively, together with accrued interest on such amount of
prepaid principal to the date of such prepayment to be paid by the Company to
the Noteholders from the Company’s cash resources.


 


(b) Each Noteholder
shall have received an executed copy of the letter agreement referred to in
Section 4.7(a) in form and substance satisfactory to the Required Holders. The
letter agreement shall specify with respect to each Noteholder in each case as
at the Project Schultz Prepayment Date (i) its pro rata share of the prepayment
referred to in Section 4.7(a), (ii) the applicable Make-Whole Amount payable to
it determined for the prepayment date, and (iii) the amount of accrued interest
on such amount of prepaid principal to the date of such prepayment and due to
each such Noteholder.


 


1.15.                     Payment of Fees and Expenses.


 


Without limiting the provisions of Section
15.1, on or before the Effective Date the Company shall have:


 


(a)                               paid
in full an amendment fee in cash by wire transfer of immediately available
funds in US Dollars to each Noteholder of 0.50% of the aggregate outstanding
principal amount of the Existing Notes held by such Noteholder after the
prepayment of the Existing Notes pursuant to Section 4.7(a) of this Agreement,
to be allocated to each holder of the Existing Notes on a pro rata basis, based
on the aggregate principal amount of Notes specified below such Noteholder’s
name in Schedule A;


 


(b)                               paid
all invoiced fees, charges and disbursements of Bingham McCutchen LLP, the
Noteholders’ special counsel;


 


(c)                            paid
all invoiced fees, charges and disbursements of PricewaterhouseCoopers, the
Noteholders’ reporting accountants; and


 


26

















 


(d)                               reimbursed
each of the Noteholders for the out-of-pocket expenses of their respective
employees incurred in connection with the negotiation of the Restructuring
Transaction as evidenced by receipts and other documentation delivered to the
Company prior to the Effective Date.


 


4.9.                            Bank Facility Agreement.


 


The amendments to the Bank Facility Agreement
shall have been executed and delivered by all parties thereto, all the
conditions precedent to the effectiveness thereof shall have been either
satisfied or permanently waived by the parties thereto (except for the
condition precedent thereunder requiring the conditions precedent to this
Agreement being satisfied) and such amendments shall be in full force and
effect simultaneously with the Effective Date. 
The Bank Facility Agreement and all documents and instruments executed
and delivered in connection therewith shall be in accordance with the terms set
out in the Banks’ term sheet attached as Exhibit 4.9 hereto and otherwise in
form and substance satisfactory to the Required Holders.  Each Noteholder or its special counsel shall
have received a conformed or certified copy of a fully executed counterpart of
the Bank Facility Agreement as amended and each other agreement and instrument
delivered in connection therewith (including, without limitation, all fee
letters), certified as true and correct by a Responsible Officer as well as
confirmed by such Responsible Officer as having become wholly unconditional in
accordance with its terms subject to the occurrence of the Effective Date.


 


4.10.                     Project Schultz.


 


The Project Schultz Transaction shall have
been duly consummated on or prior to the Effective Date in accordance with the
terms of the Project Schultz Documentation. 
Each Noteholder or their special counsel shall have received (a) copies
of fully executed counterparts of the Project Schultz Documentation and each
other agreement and instrument delivered in connection therewith, certified as
true and correct by a Responsible Officer, (b) confirmation from the Company
that the requisite majority of its shareholders have approved the Project
Schultz


 


27

















 


Transaction, and (c) confirmation that the
Project Schultz Transaction has become wholly unconditional in accordance with
the terms of the Project Schultz Documentation.


 


4.11.                     Accountants’ Report.


 


Each Noteholder shall have received a report
from PricewaterhouseCoopers addressed (among others) to the Noteholders
relating to their review as specified in their engagement letter dated January 30,
2003 in form and substance satisfactory to the Required Holders.


 


4.12.                     Accountants’ Engagement.


 


Each Noteholder shall have received an
executed copy of an engagement letter between PricewaterhouseCoopers and the
Company in form and substance satisfactory to the Required Holders in
connection with their engagement to review and provide the Noteholders with a
summary of certain financial information.


 


4.13.                     Consents, Authorizations, Licenses and Approvals.


 


The Company shall have delivered to each
Noteholder either:


 


(a)                               a
copy, certified as a true copy by a Senior Financial Officer, of all consents,
authorizations, licenses and approvals required by the Company and each
Original Guarantor to authorize, or required by the Company and each Original
Guarantor in connection with, the execution, delivery, validity, enforceability
and admissibility in evidence of the Financing Documents and the performance by
the Company and each Original Guarantor of its respective obligations under the
Financing Documents; or


 


(b)                               a
certificate signed by a Senior Financial Officer that no such consent,
authorization, license or approval referred to in clause (a) above is


 


28

















 


required by the Company or any Original
Guarantor.


 


4.14.                     Miscellaneous.


 


The Company shall have delivered to each Noteholder:


 


(a) a copy of the disclosure letter provided to the Banks pursuant to
paragraph 15 of Schedule 1 to the supplemental agreement dated March 11, 2003
to the Bank Facility Agreement; and


 


(b) a copy of the form of the quarterly report to be delivered under
Section 7.1(A)(d) or Section 7.1(B)(c), as the case may be.


 


4.15.                     Proceedings and Documents.


 


All corporate and other proceedings in
connection with the transactions contemplated by this Agreement and all
documents and instruments incidental to such transactions (other than those
relating to the Project Schultz Transaction) shall be satisfactory to the
Noteholders and their special counsel, and the Noteholders and their special
counsel shall have received all such counterpart originals or certified or
other copies of such documents as the Noteholders or their special counsel may
reasonably request.


 


5.                                      REPRESENTATIONS
AND WARRANTIES OF THE
COMPANY.


 


The Company represents and warrants to each
Noteholder that as of the date hereof and as of the Effective Date (except for
the representation and warranty set forth in Section 5.9 as to charges,
accruals and reserves on the books of the Company and its Subsidiaries only and
the representations and warranties set forth in Section 5.18, which
representations and warranties shall be made at the date hereof that):


 


29

















 


5.1.                            Organization; Power and Authority.


 


The Company is a corporation duly organized
and validly existing under the laws of its jurisdiction of incorporation, and
(to the extent such concept is recognized in such jurisdiction) in good
standing under the laws of its jurisdiction of incorporation, and is duly
qualified as a foreign corporation and (to the extent such concept is
recognized in such jurisdictions) is in good standing in each jurisdiction in
which such qualification is required by law, other than those jurisdictions as
to which the failure to be so qualified or in good standing could not,
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect.  The Company has the
corporate power and authority to own or hold under lease the properties it
purports to own or hold under lease, to transact the business it transacts and
proposes to transact, to execute and deliver the Financing Documents, and to
perform the provisions hereof and thereof.


 


5.2.                            Authorization, etc.


 


Each of this Agreement and the Notes, in the case of the Company, and
the Subsidiary Guarantee to which it is a party, in the case of each Original
Guarantor, has been duly authorized by all necessary corporate action on the
part of such Person and constitutes a legal, valid and binding obligation of
such Person enforceable against such Person in accordance with its terms,
except as such enforceability may be limited by (a) applicable bankruptcy,
insolvency, reorganizations, moratorium or other similar laws affecting the
enforcement of creditors’ rights generally, and (b) general principles of
equity (regardless of whether such enforceability is considered in a proceeding
in equity or at law).


 


5.3.                            Disclosure, etc.


 


(a) Disclosure. The
Company has delivered to each Noteholder the Information Pack, relating to the
transactions contemplated hereby. 
Except as disclosed in Schedule 5.3, the Financing Documents, the Information Pack, the documents,
certificates or other writings delivered to the Noteholders by or on behalf of
the Company in connection with the transactions contemplated hereby and the
financial statements listed in


 


30

















 


Schedule 5.5, do not contain any untrue
statement of a material fact or omit to state any material fact necessary to
make the statements therein not misleading in light of the circumstances under
which they were made or which, if disclosed, could reasonably be expected to
adversely affect the decision of a Person considering whether to enter into
this Agreement.  Except as disclosed in
the Information Pack or as expressly described in Schedule 5.3, or in one of
the documents, certificates or other writings identified therein, or in the
financial statements listed in Schedule 5.5, since December 31, 2001,
there has been no change in the financial condition, operations, business or
properties of the Company and its Subsidiaries, taken as a whole, except
changes that individually or in the aggregate could not reasonably be expected
to have a Material Adverse Effect. 
There is no fact known to the Company that could reasonably be expected
to have a Material Adverse Effect that has not been set forth herein or in the
Information Pack or in the other documents, certificates and other writings
delivered to the Noteholders by or on behalf of the Company specifically for
use in connection with the transactions contemplated hereby.


 


(b) Projections.          All information provided by the Company to each
Noteholder that constitutes forecasts or projections relating to the Company
and its Subsidiaries (including without limitation, the forecasts and
projections contained in the Information Pack), were arrived at after careful
consideration and, in view of the circumstances existing at the time such
forecasts and projections were made, is based on information that the Company
believed to be complete and accurate at the time of the preparation thereof and
at the time that such forecasts and projections were supplied and, to the
knowledge of the Company, does not contain any untrue statement of a material
fact or omit to state any fact necessary to make such forecasts and projections
not materially misleading in light of the circumstances under which such
forecasts and projections were prepared (although no representation or warranty
is hereby made that such condition or performance will actually be
achieved).  All material assumptions and
estimates upon which any such forecasts or projections have been based are
reasonable in view of the circumstances existing at the


 


31

















 


time such assumptions and estimates were
made, and since such time, to the knowledge of the Company, there has been no
change in such circumstances, or change in such assumptions and estimates upon
which such forecasts and projections were based, which would materially adversely
affect such forecasts or projections.


 


5.4.                            Organization and Ownership of Shares of
Subsidiaries; Affiliates.


 


(a) Schedule 5.4 contains (except as noted
therein) a group structure chart complete and correct in all material respects
and as previously provided to PricewaterhouseCoopers together with complete and
correct lists of:


 


(i)                                  each
of the Subsidiaries of the Company that, as at December 31, 2002,
principally affects the financial statements of the Group (as set forth in the
financial statements of the Group dated such date) showing, as to each such
Subsidiary, the correct name thereof, the jurisdiction of its organization, and
the percentage of each class of its common equity securities (and securities
convertible into or exchangeable for such common equity securities) owned by
the Company directly or indirectly;


 


(ii)                              the
Material Subsidiaries of the Company, (A) showing, as to each such Material
Subsidiary, the correct name thereof, the jurisdiction of its organization, and
the percentage of each class of its common equity securities (and securities
convertible into or exchangeable for such common equity securities) owned by
the Company and each Subsidiary, (B) listing such Material Subsidiaries in
descending order of their contribution to Consolidated EBIT (and, where the
Consolidated EBIT for two or more Material Subsidiaries is the same, in
descending order of their contribution to Consolidated Total Assets) for the
Accounting Period ending on December 31, 2002, (C) stating that, as of the end
of the


 


32

















 


Accounting Period ending on December 31,
2002, the aggregate of the EBIT and Total Assets of all such Material
Subsidiaries plus the EBIT and Total Assets of the Company accounts for at
least 80% of Consolidated EBIT and 80% of Consolidated Total Assets for, and as
at the end of, such Accounting Period, respectively, and (D) setting out the
proportion which the aggregate EBIT and Total Assets of the Company and all
such Material Subsidiaries bears to the Consolidated EBIT and Consolidated
Total Assets as at the end of the Accounting Period ending on December 31,
2002;


 


(iii)                          the
Affiliates (other than Subsidiaries) of the Company; and


 


(iv)                            the
directors of the Company.


 


(b) All of the outstanding share capital and
shares of other common equity securities (and securities convertible into or
exchangeable for such common equity securities) of each Material Subsidiary
shown in Schedule 5.4 as being owned by the Company or a Subsidiary have been
validly issued, and, in the case of Subsidiaries organized under the laws of
the United States or any state thereof, are fully paid and nonassessable and
are owned by the Company or a Subsidiary free and clear of any Lien (except as
otherwise disclosed in Schedule 5.13).


 


(c) Each Material Subsidiary identified in
Schedule 5.4 is a corporation or other legal entity duly organized, validly
existing and (to the extent such concept is recognized in such jurisdiction) in
good standing under the laws of its jurisdiction of organization, and is duly
qualified as a foreign corporation or other legal entity and (to the extent
such concept is recognized in such jurisdictions) is in good standing in each
jurisdiction in which such qualification is required by law, other than those
jurisdictions as to which the failure to be so qualified or in good standing
could not, individually or in the aggregate, reasonably be expected to have a
Material Adverse Effect.  Each such
Material Subsidiary has the corporate or other power and authority to own or
hold under lease the properties it purports to


 


33

















 


own or hold under lease and to transact the
business it transacts and proposes to transact as described in the Information
Pack.


 


(d) No Subsidiary is a party to, or otherwise
subject to, any legal restriction or any agreement (other than this Agreement,
the agreements listed on Schedule 5.4 and customary limitations imposed by
corporate law statutes) restricting the ability of such Subsidiary to pay
dividends out of profits or make any other similar distributions of profits to
the Company or any Subsidiary that owns outstanding share capital or shares of
other common equity interests of such Subsidiary (except, in the case of any
Subsidiary that is not a Material Subsidiary, where such restriction or
agreement could not reasonably be expected to have a Material Adverse Effect).


 


5.5.                            Financial Statements.


 


The Company has
delivered to each Noteholder copies of the consolidated financial statements of
the Group listed on Schedule 5.5.  The
financial statements dated as of December 31, 2001 (including in each case the
related schedules and notes) have been prepared in accordance with UK GAAP as
at December 31, 2001 consistently applied throughout the periods involved,
except as set forth in the notes thereto, and present a true and fair view of
the consolidated financial position and results of operations and cash flows of
the Company and its Subsidiaries as of the respective dates and for the respective
periods specified in such Schedule 5.5. 
The other financial statements listed in Schedule 5.5 have been prepared
in accordance with UK GAAP consistently applied throughout the periods involved
and using accounting policies consistent with those used by the Company and the
Subsidiaries in their most recent audited accounts, except where any changes,
and the reasons therefor, have been disclosed in such financial
statements.  In the case of each
Guarantor which produces audited accounts, its audited accounts dated as of
December 31, 2001 (including in each case the related schedules and notes) have
been prepared in accordance with UK GAAP as at December 31, 2001 consistently
applied throughout the periods involved, except


 


34

















 


as set forth in the notes thereto, and
present a true and fair view of the financial position and results of
operations and cash flows of such Guarantor as of the date to which they were
drawn up.  In the case of a Guarantor
which does not produce audited accounts, the accounts of such Guarantor dated
as of December 31, 2001 (including in each case the related schedules and
notes) have been prepared in accordance with accounting principles required in
order to consolidate the accounts of that Guarantor into the consolidated
accounts of the Company.  As at the
Effective Date, there has been no material adverse change in the consolidated
financial condition of the Company and its Subsidiaries taken as a whole since
December 31, 2001.


 


5.6.                            Compliance with Laws, Other Instruments, etc.


 


The execution,
delivery and performance by the Company of the Financing Documents to which it
is a party will not:


 


 


(a) contravene,
result in any breach of, or constitute a default under, or result in the
creation of any Lien in respect of any property of the Company or any
Subsidiary under, any indenture, mortgage, deed of trust, loan, purchase or
credit agreement, lease,
memorandum or articles of association, corporate charter or by-laws, or any
other agreement or instrument to which the Company or any Subsidiary is bound
or by which the Company or any Subsidiary or any of their respective properties
may be bound or affected;


 


(b) conflict with or result in a breach of any of the terms, conditions
or provisions of any order, judgment, decree, or ruling of any court,
arbitrator or Governmental Authority applicable to the Company or any
Subsidiary; or


 


(c) violate any provision of any statute or other rule or regulation of
any Governmental Authority applicable to the Company or any Subsidiary.


 


35

















 


5.7.                            Governmental Authorizations, etc.


 


No consent, approval or authorization of, or
registration, filing or declaration with, any Governmental Authority is
required in connection with the Restructuring Transaction or in connection with
the execution, delivery, or performance by the Company or any Guarantor, or the
enforceability against the Company or any such Guarantor, of the Financing
Documents to which the Company or such Guarantor is a party, or in connection
with the validity of such Financing Documents.


 


5.8.                            Litigation; Observance of Agreements, Statutes and Orders.


 


(a) Except as disclosed on Schedule 5.8,
there are no actions, suits or proceedings pending or, to the knowledge of the
Company, threatened against or affecting the Company or any Subsidiary or any
property of the Company or any Subsidiary in any court or before any arbitrator
of any kind or before or by any Governmental Authority that, individually or in
the aggregate, could reasonably be expected to have a Material Adverse Effect.


 


(b) Neither the
Company nor any Subsidiary is in default under any term of any agreement or
instrument to which it is a party or by which it is bound, or any order, judgment,
decree or ruling of any court, arbitrator or Governmental Authority or is in
violation of any applicable law, ordinance, rule or regulation (including,
without limitation, Environmental Laws) of any Governmental Authority, which
default or violation, individually or in the aggregate, could reasonably be
expected to have a Material Adverse Effect.


 


5.9.                            Taxes.


 


The Company and the Subsidiaries have filed
all income and other Material tax returns that are required to have been filed
by such companies in any


 


36

















 


jurisdiction, and have paid all taxes shown
to be due and payable on such returns and all other taxes and assessments
levied upon them or their properties, assets, income or franchises, to the extent
such taxes and assessments have become due and payable and before they have
become delinquent, except for any taxes and assessments (a) the amount of which
is not individually or in the aggregate Material, or (b) the amount,
applicability or validity of which is currently being contested in good faith
by appropriate proceedings and with respect to which the Company or such
Subsidiary, as the case may be, has established adequate reserves or provisions
in accordance with, and to the extent required by, Applicable GAAP. The Company
knows of no basis for any other tax or assessment that could reasonably be
expected to have a Material Adverse Effect. 
The charges, accruals and reserves on the books of the Company and its
Subsidiaries as at the date hereof in respect of taxes for all completed
financial periods are adequate under UK GAAP. 
The United Kingdom income tax liabilities of the Company and its
Subsidiaries have been finally determined by the United Kingdom Inland Revenue
and paid for all tax years up to and including the tax year ending December 31,
1998.


 


5.10.                     Title to Property; Leases.


 


Each of the Company and its Subsidiaries has
good and sufficient title to their respective properties that, individually or
in the aggregate, are Material including all such properties reflected in the
most recent audited balance sheet referred to in Section 5.5 or purported to
have been acquired by the Company or any Subsidiary after said date (except as
sold or otherwise disposed of in the ordinary course of business), in each case
free and clear of Liens prohibited by this Agreement.  All leases that, individually or in the aggregate, are Material
are valid and subsisting and are in full force and effect in all material respects.


 


5.11.                     Licenses,
Permits, etc.


 


(a) The Company and the Subsidiaries own or
possess all licenses, permits, franchises, authorizations, patents, copyrights,
service marks,


 


37

















 


trademarks and trade names, or rights thereto, that, individually or in
the aggregate, are Material, without known conflict with the rights of others.


 


(b) To the best knowledge of the Company, no product of the Company or any of its Subsidiaries infringes
in any Material respect on any license, permit, franchise, authorization, patent, copyright,
service mark, trademark, trade name or other right owned by any other Person.


 


(c) To the best knowledge of the Company, there is no Material
violation by any Person of any right of the Company or any of its Subsidiaries
with respect to any patent, copyright, service mark, trademark, trade name or
other right owned or used by the Company or any of its Subsidiaries.


 


5.12.                     Compliance
with ERISA.


 


(a) To the extent that the Company, or the ERISA Affiliates have
established US Plans, the Company, and the ERISA Affiliates have operated and
administered each US Plan in compliance with all applicable laws except for
such instances of noncompliance as have not resulted in and could not
reasonably be expected to result in a Material Adverse Effect.  Neither the Company nor any ERISA Affiliate
has incurred any liability pursuant to Title I or IV of ERISA or the penalty or
excise tax provisions of the US Tax Code relating to employee benefit plans (as
defined in Section 3 of ERISA), and no event, transaction or condition has
occurred or exists that could reasonably be expected to result in the
incurrence of any such liability by the Company or any ERISA Affiliate, or in
the imposition of any Lien on any of the rights, properties or assets of the
Company or any ERISA Affiliate, in either case pursuant to Title I or IV of
ERISA or to such penalty or excise tax provisions or to Section 401(a)(29) or
412 of the US Tax Code, other than such liabilities or Liens as would not be
individually or in the aggregate Material.


 


(b) The present value of the aggregate benefit liabilities under each
of the US Plans (other than US Multiemployer Plans), determined as of the


 


38

















 


end of such US Plan’s most recently ended plan year on the basis of the
actuarial assumptions specified for funding purposes in such US Plan’s most
recent actuarial valuation report, did not exceed the aggregate current value
of the assets of such US Plan allocable to such benefit liabilities.  The term “benefit liabilities”  has the meaning specified in Section 4001
of ERISA and the terms “current value” and “present value” have the meaning specified in Section
3 of ERISA.


 


(c) The Company and the ERISA Affiliates have not incurred withdrawal
liabilities (and are not subject to contingent withdrawal liabilities) under
Section 4201 or 4204 of ERISA in respect of US Multiemployer Plans that
individually or in the aggregate are Material.


 


(d) The expected postretirement benefit obligation (determined as of
the last day of the Company’s most recently ended financial year in accordance
with United States of America Financial Accounting Standards Board Statement
No. 106, without regard to liabilities attributable to continuation coverage
mandated by Section 4980B of the US Tax Code) of the Company and its
Subsidiaries is not Material.


 


(e) The execution and delivery of the Existing Note Purchase Agreements
and of this Agreement, the issuance and sale of the Existing Notes on November
23, 1999 and the amendment and restatement of the Existing Notes pursuant to
this Agreement did not and does not involve any transaction that is or was
subject to the prohibitions of Section 406 of ERISA or in connection with which
a tax could be imposed pursuant to Section 4975(c)(1)(A)-(D) of the US Tax
Code.  The representation by the Company
in the immediately preceding sentence is made in reliance upon and subject to
the accuracy of the representation of each Noteholder in Section 6.2 as to the
sources of the funds used to pay the purchase price of the Existing Notes
purchased by such Noteholder.


 


(f) All Non-US Pension Plans have been established, operated,
administered and maintained in compliance with all laws, regulations and


 


39

















 


orders applicable thereto except for such failures to comply, in the
aggregate for all such failures, that could not reasonably be expected to have
a Material Adverse Effect.  All
premiums, contributions and any other amounts required by applicable Non-US
Pension Plan documents or applicable laws have been paid or accrued as
required, except for premiums, contributions and amounts that, in the aggregate
for all such obligations, could not reasonably be expected to have a Material
Adverse Effect.


 


(g) The Company and the ERISA Affiliates are not under an obligation to
furnish a report to the Noteholders in accordance with Section 9.10 as a result
of any event or condition that has occurred or exists.


 


5.13.                     Existing
Financial Indebtedness;
Future Liens.


 


(a) Except as described therein, Schedule 5.13 sets forth a complete
and correct list of each item of outstanding Financial Indebtedness of the
Company and its Subsidiaries as of December 31, 2002 (which list specifies, as
to each such item of Financial Indebtedness, the collateral, if any, securing such Financial
Indebtedness), since which date there has been no (i) material increase in the
interest rates of such Financial Indebtedness, other than in accordance with
the terms thereof in effect as of December 31, 2002, (ii) increase in sinking
funds of such Financial Indebtedness, other than in accordance with the terms
thereof in effect as of December 31, 2002, (iii) increase in instalment
payments or reduction of maturities of such Financial Indebtedness (other than
in connection with a prepayment thereof as permitted by the terms and
provisions of the agreements and instruments governing such Financial
Indebtedness as in effect from time to time), or (iv) increase in amounts of
such Financial Indebtedness that otherwise would not be permitted under Section
10.6 and Section 10.7.  Neither the
Company nor any Subsidiary is in default, and no waiver of default is currently
in effect, in the payment of any principal or interest on any such Financial Indebtedness
of the Company or such Subsidiary and


 


40

















 


no event or condition exists with respect to any such Financial
Indebtedness of the Company or any Subsidiary that would permit (or that with
notice or the lapse of time, or both, would permit) one or more Persons to
cause such Financial Indebtedness to become due and payable before its stated
maturity or before its regularly scheduled dates of payment (other than
mandatory prepayments or repurchases of Financial Indebtedness resulting from,
or arising in connection with, transactions that would be permitted by Section
10.2 and Section 10.4).


 


(b) Except as disclosed in Schedule 5.13, neither the Company nor any
Subsidiary has agreed or consented to cause or permit in the future (upon the
happening of a contingency or otherwise) any of its property, whether now owned
or hereafter acquired, to be subject to a Lien not permitted by Section 10.3.


 


5.14.                     Foreign Assets Control Regulations, etc.


 


(a) Neither the sale of the Existing Notes by the Company, its use of
the proceeds thereof, and the execution, delivery and performance of the
Existing Note Purchase Agreements violated, nor will the execution, delivery
and performance of this Agreement by the Company nor the amendment and
restatement of the Existing Notes pursuant to this Agreement violate, the
Trading with the Enemy Act of the United States of America, as amended, or any
of the foreign assets control regulations of the Treasury Department of the
United States of America (31 CFR, Subtitle B, Chapter V, as amended) or any
enabling legislation or executive order relating thereto.


 


(b) Neither the Company nor any Subsidiary is a Person or entity
described by Section 1 of Executive Order 13224 of September 23, 2001 Blocking
Property and Prohibiting Transactions With Persons Who Commit, Threaten to
Commit, or Support Terrorism, Exec. 
Order No. 13,224 66 Fed. Reg. 47,079 (2001), and neither the Company nor
any


 


41

















 


Subsidiary is knowingly engaged in any dealings or transactions, or is
otherwise associated with any such Persons or entities in violation of such
Executive Order.


 


5.15.                     Status under Certain Statutes.


 


Neither the Company nor any Subsidiary is
subject to regulation under the Investment Company Act of 1940 of the United
States of America, as amended, the Public Utility Holding Company Act of 1935
of the United States of America, as amended, or the Federal Power Act of the
United States of America, as amended.


 


5.16.                     Environmental Matters.


 


(a) Neither the Company nor any Subsidiary has knowledge of any claim
or has received any notice of any claim, and no proceeding has been instituted
raising any claim against the Company or any of its Subsidiaries or any of
their respective real properties now or formerly owned, leased or operated by
any of them or other assets, alleging any damage to the environment or
violation of any applicable Environmental Laws, except, in each case, such as
could not reasonably be expected to result in a Material Adverse Effect.


 


(b) Neither the Company nor any of its Subsidiaries has knowledge of
any facts which would give rise to any claim, public or private, of violation
of applicable Environmental Laws or damage to the environment emanating from,
occurring on or in any way related to real properties now or formerly owned,
leased or operated by any of them or to other assets or their use, except, in
each case, such as could not reasonably be expected to result in a Material Adverse
Effect.


 


(c) Neither the Company nor any of its Subsidiaries has stored any
Hazardous Materials on real properties now or formerly owned, leased or
operated by any of them and has not disposed of any Hazardous Materials


 


42

















 


in a manner contrary to any applicable
Environmental Laws in each case in any manner that could reasonably be expected
to result in a Material Adverse Effect.


 


(d) All buildings on all real properties now
owned, leased or operated by the Company or any of its Subsidiaries are in
compliance with applicable Environmental Laws, except where failure to comply
could not reasonably be expected to result in a Material Adverse Effect.


 


Pari Passu Ranking.


 


The Company’s obligations under the Financing
Documents rank at least pari passu, without preference or priority, with all of
its other outstanding obligations in respect of its senior, unsecured and
unsubordinated Financial Indebtedness, except for those obligations that are
mandatorily preferred by law and not by reason of contract.


 


5.18.                     Withholding Taxes.


 


Assuming that (a) each Noteholder is and will
be a resident of the United States of America for the purposes of the Double
Taxation Convention between the United States of America and the United
Kingdom, dated 31st December, 1975 as may from time to time be amended,
re-enacted or replaced (the “US/UK Tax Treaty”), (b) the income each Noteholder receives under the Notes is not and
will not be attributable to a business carried on through a permanent
establishment, or to the performance of personal services through a fixed base,
in the United Kingdom, (c) the income each Noteholder receives under the Notes
is and will be subject to United States taxation, (d) less than 25% of such
Noteholder’s capital is and will be owned directly or indirectly by one or more
Persons who are not individual residents and not nationals of the United States
of America, (e) each Noteholder submits a validly completed and duly executed
United Kingdom Inland Revenue Form FD 13 to the IRS, and (f) the IRS certifies
on such Form FD 13 that each Noteholder is a corporation that has filed a
United States Corporation Income Tax Return as a domestic corporation for its
most recently


 


43

















 


ended tax year for
which such return is required to be filed (giving effect to any applicable
extension) and such certified Form FD 13 is received from the IRS by the Inland
Revenue and the Inland Revenue certifies to the Company such Noteholder’s
entitlement to the benefit of the US / UK Tax Treaty prior to the first
interest payment date under the Notes, the Company will not be required to make
any deduction or withholding from any interest payment it may make to each
Noteholder under this Agreement or the Notes under the laws of the United
Kingdom or any jurisdiction or territory thereof as in effect on the date
hereof.


 


5.19.                     Solvency.


 


The fair value of the businesses and assets of the Company and each
Guarantor will be in excess of the amount that will be required to pay the
total liabilities of the Company or such Guarantor (including, without
limitation, contingent, subordinated, unmatured and unliquidated liabilities on
existing debts, as such liabilities may become absolute and matured), in each
case after giving effect to the transactions contemplated by this Agreement and
the other Financing Documents and the use of proceeds therefrom.  The Company and each Guarantor, after giving
effect to the transactions contemplated by this Agreement and the other
Financing Documents and the use of the proceeds therefrom, will not be:


 


(a) “insolvent” (as such term is defined in the US Bankruptcy Code);


 


(b) unable to pay its debts (within the meaning of Section 123(1)(a) or
(e) or Section 123(2) of the Insolvency Act); or


 


(c) engaged in any business or transaction, or about to engage in any
business or transaction, for which the Company or such Guarantor has an
unreasonably small capital.


 


Neither the Company nor any Guarantor has any
intent to (i) hinder, delay or defraud any entity to which it is, or will
become, on or after the date hereof, indebted, or (ii) incur debts that would
be beyond its ability to pay as they mature.


 


44

















 


5.20.                     No Event of Default.


 


Without prejudice to Section 1.6 hereof, on
Default or Event of Default (as each such term is defined in the Existing Note
Purchase Agreements) and no Default or Event of Default (as each such term is
defined in this Agreement) has occurred and is continuing.


 


6.                                      REPRESENTATIONS OF THE NOTEHOLDERS.


 


Each Noteholder represents that at least one
of the following statements is an accurate representation as to each source of
funds (a “Source”) used by it to acquire the Existing Notes:


 


(a) the Source was
an “insurance company general account” as defined in United States Department
of Labor Prohibited Transaction Exemption (“PTE”)
95-60 (60 FR 35925, July 12, 1995) and in respect thereof represents as at
November 23, 1999 that there was no “employee benefit plan” (as defined in
Section 3(3) of ERISA and Section 4975(e)(1) of the US Tax Code, treating as a
single plan all plans maintained by the same employer or employee organization
or affiliate thereof) with respect to which the amount of the general account
reserves and liabilities of all contracts held by or on behalf of such plan
exceeded 10% of the total reserves and liabilities of such general account
(exclusive of separate account liabilities) plus surplus, as set forth in the
NAIC Annual Statement then filed with its state of domicile; or


 


(b) if such
Noteholder was an insurance company, the Source did not include assets
allocated to any separate account maintained by it in which any employee
benefit plan (or its related trust) had any interest, other than a separate
account that was maintained solely in connection with its fixed contractual
obligations under which the amounts payable, or credited, to such plan and to
any participant or beneficiary of such plan (including any annuitant) were not
affected in any manner by the investment performance of the separate account;
or


 


45

















 


(c) the Source was
either (i) an insurance company pooled separate account, within the meaning of
PTE 90-1 (issued January 29, 1990), or (ii) a bank collective investment fund,
within the meaning of PTE 91-38 (issued July 12, 1991) and, except as it had
disclosed to the Company in writing, no employee benefit plan or group of plans
maintained by the same employer or employee organization beneficially owned
more than 10% of all assets allocated to such pooled separate account or
collective investment fund; or


 


(d) the Source
constituted assets of an “investment fund” (within the meaning of Part V of the
QPAM Exemption) managed by a “qualified professional asset manager” or “QPAM”
(within the meaning of Part V of the QPAM Exemption), no employee benefit
plan’s assets that were included in such investment fund, when combined with
the assets of all other employee benefit plans established or maintained by the
same employer or employee benefit plans established or maintained by the same
employer or by an affiliate (within the meaning of section V(c(1) of the QPAM
Exemption) of such employer or by the same employee organization and managed by
such QPAM, exceeded 20% of the total client assets managed by such QPAM, the
conditions of Part I(c) and (g) of the QPAM Exemption were satisfied, neither
the QPAM nor a Person controlling or controlled by the QPAM (applying the
definition of “control” in section V(e) of the QPAM Exemption) owned a 5% or
more interest in the Company or any Guarantor; and


 


(i)                                  the
identity of such QPAM; and


 


(ii)                              the
names of all employee benefit plans whose assets are included in such
investment fund were disclosed to the Company in writing; or


 


(e) the Source was a
governmental plan; or


 


(f) the Source was
one or more employee benefit plans, or a separate account or trust fund
comprised of one or more employee benefit plans, each


 


46

















 


of which had been identified to the Company
in writing; or


 


(g) the Source did
not include assets of any employee benefit plan, other than a plan exempt from
the coverage of ERISA.


 


As used in this Section 6, the terms  “employee benefit plan”,  “governmental plan”, “party in interest” and  “separate
account” shall have the
respective meanings assigned to such terms in Section 3 of ERISA.


 


7.                                     INFORMATION AS TO THE COMPANY.


 


7.1.                            Financial and Business Information.


 


(A)                              Financial and Business Information prior to the
Normalization Date.  Prior to
the Normalization Date, the Company shall deliver to each Noteholder:


 


(a) Semi-Annual Statements — as soon as
practicable and in any event within 120 days after the end of the first
six-month period of each financial year of the Company, two copies of:


 


(i)                                  an
unaudited consolidated balance sheet of the Company and its Subsidiaries as at
the end of such six-month period; and


 


(ii)                              an
unaudited consolidated statement of cash flows and an unaudited consolidated
profit and loss account of the Company and its Subsidiaries, for such six-month
period,


 


setting forth in each case in comparative
form the figures for the corresponding period in the previous financial year,
all in reasonable detail, prepared in accordance with UK GAAP applicable to
half-year financial statements generally, and accompanied by an independent
chartered accountants’ report or, in the event that such report is not
provided, an Officer’s Certificate, in each case to the effect that (A) such
statements were prepared using accounting policies consistent with


 


47

















 


those used by the Company and its
Subsidiaries in their most recent audited reports (except where any changes,
and the reasons therefor, are disclosed in such financial statements), and (B)
the independent chartered accountants or the Senior Officers giving the
Officer’s Certificate (as the case may be) are not aware of any modifications
that should be made to such half-year financial statements in order to make
them not misleading in any material respect, provided that the Company shall be
deemed to comply with the requirements of this Section 7.1(A)(a) by furnishing
(within the time period specified above) copies of the Company’s unaudited
published interim financial statements for such period as provided to the LSE
so long as such statements contain substantially the same information as
specified in sub-clause (i) and sub-clause (ii) above;


 


(b) Annual
Statements — as soon as practicable:


 


(i)                                  and
in any event within 145 days after the end of each financial year of the
Company, two copies of:


 


(x)                                a
consolidated balance sheet of the Company and its Subsidiaries, as at the end
of such year;


 


(y)                                a
consolidated statement of cash flows and a consolidated profit and loss account
of the Company and its Subsidiaries, for such year; and


 


(ii)                              and
in any event within 180 days after the end of each financial year of the
Company, two copies of:


 


(x)                                in
the case of any Guarantor where the jurisdiction in which that Guarantor is
incorporated requires that Guarantor to produce annual audited accounts, the
audited accounts of that Guarantor; or


 


(y)                                in
any other case, the accounts of each Guarantor used by the auditors of the
Company in preparing the audited consolidated accounts of the Company,


 


48

















 


setting forth in the case of sub-clause
(i)(x) and sub-clause (i)(y) above in comparative form the figures for the
previous financial year, all in reasonable detail, prepared in accordance with
UK GAAP, and accompanied by:


 


(A)                              an
opinion thereon of independent chartered accountants of recognized
international standing, which opinion shall state without Significant
Qualification that such financial statements have been prepared in accordance
with the Companies Act 1985 and give a true and fair view of the consolidated
financial position of the companies being reported upon and their consolidated
results of operations and cash flows in all material respects, and that the
examination of such auditors in connection with such financial statements has
been made in accordance with generally accepted auditing standards in the
United Kingdom, and that such audit was conducted so as to provide reasonable
assurance that such financial statements are free from material misstatement;
and


 


(B)                              a
certificate of such auditors stating that (x) they have reviewed this Agreement
and the certificate of Senior Officers of the Company delivered pursuant to
Section 7.2 with respect to such financial year, and (y) that they concur with
the calculations contained in such certificate;


 


and setting forth in the case of sub-clause
(ii)(x) and sub-clause (ii)(y) above in comparative form the figures for the
previous financial year, all in reasonable detail.


 


(c) Monthly Management Accounts and
PricewaterhouseCooper’s summary and analysis — as soon as
practicable and in any event within 21 days after the end of the month to which
they relate, two copies of the consolidated monthly management accounts in
respect of the Group, prepared in accordance with UK GAAP (consistently
applied) applicable to management accounts generally and including (i) a
consolidated balance sheet, (ii) a consolidated profit and loss


 


49

















 


account for the relevant month and (iii) a
consolidated cashflow statement in the form agreed with the Noteholders
provided that the Company shall concurrently deliver copies of all such monthly
management accounts to PricewaterhouseCoopers in connection with their
engagement to provide the Noteholders with a summary and analysis thereof on a
quarterly basis pursuant to the terms of reference referred to in Section 4.12;


 


(d) Quarterly Management Accounts — as soon as
practicable and in any event within 45 days after the quarter ending on March
31 and September 30 respectively, two copies of the consolidated quarterly
management accounts in respect of the Group, prepared in accordance with UK
GAAP (consistently applied) applicable to management accounts generally and
including (i) a consolidated balance sheet, (ii) a consolidated profit and loss
account for the relevant quarter and (iii) a consolidated cashflow statement in
the form agreed with the Noteholders;


 


(e) Certain Reports — promptly upon their
becoming available, one copy of (i) each financial statement, report, notice,
proxy statement or circular sent by the Company to public securities holders
generally, its shareholders (or any class thereof) or its creditors (or any
class thereof), and (ii) each regular or periodic report, each circular, each
registration statement (without exhibits except as expressly requested by such
holder), and each prospectus and all amendments thereto filed by the Company
with the LSE or any other securities exchange or commission on which any of its
public securities are listed or with which any of its public securities are
registered, as the case may be, and of all press releases and other documents
and written statements made available generally by the Company to the public
concerning developments that are Material (except relating to product
developments);


 


(f) Notice of Default or Event of Default —
promptly, and in any event within five Business Days, after a Responsible
Officer becoming aware of the existence of any Default or Event of Default or
that any holder has given any notice or taken any action with respect to a
claimed default


 


50

















 


hereunder or that any Person has given any
notice or taken any action with respect to a claimed default of the type
referred to in Section 11(f) (unless the Company reasonably believes in good
faith that there is no such default), a written notice specifying the nature
and period of existence thereof and what action the Company is taking or
proposes to take with respect thereto;


 


(g) ERISA
Matters  — promptly, and
in any event within five days after a Responsible Officer becoming aware of any
of the following, a written notice setting forth the nature thereof and the
action, if any, that the Company or an ERISA Affiliate proposes to take with
respect thereto:


 


(i)                                  with
respect to any US Plan, any reportable event, as defined in Section 4043(c) of
ERISA and the regulations thereunder, for which notice thereof has not been
waived pursuant to such regulations as in effect on the date hereof; or


 


(ii)                              the
taking by the PBGC of steps to institute, or the threatening by the PBGC of the
institution of, proceedings under Section 4042 of ERISA for the termination of,
or the appointment of a trustee to administer, any US Plan, or the receipt by
the Company or any ERISA Affiliate of a notice from a US Multiemployer Plan
that such action has been taken by the PBGC with respect to such US
Multiemployer Plan; or


 


(iii)                          any
event, transaction or condition that could result in the incurrence of any
liability by the Company or any ERISA Affiliate pursuant to Title I or IV or
ERISA or the penalty or excise tax provisions of the US Tax Code relating to
employee benefit plans, or in the imposition of any Lien on any of the rights,
properties or assets of the Company or any ERISA Affiliate pursuant to Title I
or IV of ERISA or such penalty or excise tax provisions, if such liability or
Lien, taken together with any other such liabilities or Liens then existing,
could reasonably be expected to have a Material Adverse


 


51

















 


Effect;


 


(h) Notices
from Governmental Authority — promptly, and in any event within 30
days of receipt thereof, copies of any notice to the Company or any Subsidiary
from any Governmental Authority relating to any order, ruling, statue or other
law or regulation that could reasonably be expected to have a Material Adverse
Effect;


 


(i) Litigation
— to the extent not prohibited by applicable law or regulation, details of any
litigation, arbitration or administrative proceedings which are current,
threatened or pending and which affect the Company or any of its Subsidiaries
and which, if adversely determined, could reasonably be expected to have a
Material Adverse Effect, as soon as practicable after the same shall be
instituted or, to the knowledge of the Company, threatened;


 


(j) Information
delivered to Other Parties — promptly upon the receipt or delivery
thereof, a copy of all other financial statements or other information about
the Company and its Subsidiaries (excluding drawdown notices and other routine
communications and certificates of an administrative nature) sent or made
available generally by the Company to its shareholders and institutional
lenders (or any class of them (including, without limitation, any lenders under
the Bank Facility, any Committed Medium-Term Financing or any Committed
External Financing)), to the extent the information contained therein has not
already been delivered to each holder of Notes;


 


(k) Rule
144A — promptly upon the request of any holder, information required
to comply with 17 CFR §230.144A (Rule 144A under the Securities Act), as
amended from time to time;


 


(l) Requested
Information — with reasonable promptness and subject to Section 7.4,
such other data and information relating to the business, operations, affairs,
financial condition, assets or properties of the Company


 


52

















 


or any of its Subsidiaries or relating to the
ability of the Company to perform its obligations hereunder and under the
Notes, or the ability of any Guarantor to perform its obligations under its
Subsidiary Guarantee, as from time to time may be reasonably requested by any
such holder of Notes (other than a Competing Person); and


 


(m)                     Conference
Call  — by way of a conference call conducted on a quarterly
basis within seven days of receipt by the Noteholders of the Company’s annual
statements, semi-annual statements or quarterly management accounts, as the
case may be by the group finance director of the Company with the Noteholders
and their special counsel, an update on the Group’s financial performance.


 


(B)                              Financial and Business Information on and after the
Normalization Date.  On and
after the Normalization Date, the Company shall deliver to each Noteholder:


 


(a)  Semi-Annual Statements. — as soon as
practicable and in any event within 120 days after the end of the first
six-month period of each financial year of the Company, two copies of:


 


(i)                                  an
unaudited consolidated balance sheet of the Company and its Subsidiaries as at
the end of such six-month period; and


 


(ii)                              an
unaudited consolidated statement of cash flows and an unaudited consolidated
profit and loss account of the Company and its Subsidiaries, for such six-month
period,


 


setting forth in each case in comparative form the figures for the
corresponding period in the previous financial year, all in reasonable detail,
prepared in accordance with UK GAAP applicable to half-year financial
statements generally, and accompanied by an independent chartered accountants’
report or, in the event that such report is not provided, an Officer’s
Certificate, in each case to the effect that (A) such statements were prepared
using accounting policies consistent with those used by the Company and its
Subsidiaries in their most recent audited


 


53

















 


reports (except where any changes, and the reasons therefor, are
disclosed in such financial statements), and (B) the independent chartered
accountants or the Senior Officers giving the Officer’s Certificate (as the
case may be) are not aware of any modifications that should be made to such
half-year financial statements in order to make them not misleading in any
material respect, provided that the Company shall be deemed to comply with the
requirements of this Section 7.1(B)(a) by furnishing (within the time period
specified above) copies of the Company’s unaudited published interim financial
statements for such period as provided to the LSE so long as such statements
contain substantially the same information as specified in sub-clause (i) and
sub-clause (ii) above;


 


(b)  Annual Statements — as soon as
practicable:


 


(i)                                  and
in any event within 145 days after the end of each financial year of the
Company, two copies of:


 


(x)                                a
consolidated balance sheet of the Company and its Subsidiaries, as at the end
of such year;


 


(y)                                a
consolidated statement of cash flows and a consolidated profit and loss account
of the Company and its Subsidiaries, for such year; and


 


(ii)                              and
in any event within 180 days after the end of each financial year of the
Company, two copies of:


 


(x)                                in
the case of any Guarantor where the jurisdiction in which that Guarantor is
incorporated requires that Guarantor to produce annual audited accounts, the
audited accounts of that Guarantor; or


 


(y)                                in
any other case, the accounts of each Guarantor used by the auditors of the
Company in preparing the audited consolidated accounts of the Company,


 


54

















 


setting forth in the case of sub-clause (i)(x) and sub-clause (i)(y)
above in comparative form the figures for the previous financial year, all in
reasonable detail, prepared in accordance with UK GAAP, and accompanied by:


 


(A)                              an
opinion thereon of independent chartered accountants of recognized
international standing, which opinion shall state without Significant
Qualification that such financial statements have been prepared in accordance
with the Companies Act 1985 and give a true and fair view of the consolidated
financial position of the companies being reported upon and their consolidated
results of operations and cash flows in all material respects, and that the
examination of such auditors in connection with such financial statements has
been made in accordance with generally accepted auditing standards in the
United Kingdom, and that such audit was conducted so as to provide reasonable
assurance that such financial statements are free from material misstatement;
and


 


(B)                              a
certificate of such auditors stating that (x) they have reviewed this Agreement
and the certificate of Senior Officers of the Company delivered pursuant to
Section 7.2 with respect to such financial year, and (y) that they concur with
the calculations contained in such certificate;


 


and setting forth in the case of sub-clause (ii)(x) and sub-clause
(ii)(y) above in comparative form the figures for the previous financial year,
all in reasonable detail.


 


(c)  Quarterly Management Accounts — as soon as
practicable and in any event within 45 days after the quarter ending on March
31 and September 30, respectively, two copies of the consolidated quarterly
management accounts in respect of the Group, prepared in accordance with UK
GAAP (consistently applied) applicable to management accounts generally and
including (i) a consolidated balance sheet, (ii) a consolidated profit and loss
account for the relevant quarter, and (iii) a consolidated


 


55

















 


cashflow statement in the form agreed with
the Noteholders;


 


(d)  Certain Reports — promptly upon their
becoming available, one copy of (i) each financial statement, report, notice,
proxy statement or circular sent by the Company to public securities holders
generally, its shareholders (or any class thereof) or its creditors (or any
class thereof), and (ii) each regular or periodic report, each circular, each
registration statement (without exhibits except as expressly requested by such
holder), and each prospectus and all amendments thereto filed by the Company
with the LSE or any other securities exchange or commission on which any of its
public securities are listed or with which any of its public securities are
registered, as the case may be, and of all press releases and other documents
and written statements made available generally by the Company to the public
concerning developments that are Material (except relating to product
developments);


 


(e)  Notice of Default or Event of Default —
promptly, and in any event within five Business Days, after a Responsible
Officer becoming aware of the existence of any Default or Event of Default or
that any holder has given any notice or taken any action with respect to a
claimed default hereunder or that any Person has given any notice or taken any
action with respect to a claimed default of the type referred to in Section
11(f) (unless the Company reasonably believes in good faith that there is no
such default), a written notice specifying the nature and period of existence
thereof and what action the Company is taking or proposes to take with respect
thereto;


 


(f)  ERISA Matters — promptly, and in any event
within five days after a Responsible Officer becoming aware of any of the following,
a written notice setting forth the nature thereof and the action, if any, that
the Company or an ERISA Affiliate proposes to take with respect thereto:


 


(i)                                  with
respect to any US Plan, any reportable event, as defined in Section 4043(c) of
ERISA and the regulations thereunder, for


 


56

















 


which notice thereof has not been waived
pursuant to such regulations as in effect on the date hereof; or


 


(ii)                              the
taking by the PBGC of steps to institute, or the threatening by the PBGC of the
institution of,  proceedings under
Section 4042 of ERISA for the termination of, or the appointment of a trustee
to administer, any US Plan, or the receipt by the Company or any ERISA Affiliate
of a notice from a US Multiemployer Plan that such action has been taken by the
PBGC with respect to such US Multiemployer Plan; or


 


(iii)                          any
event, transaction or condition that could result in the incurrence of any
liability by the Company or any ERISA Affiliate pursuant to Title I or IV of
ERISA or the penalty or excise tax provisions of the US Tax Code relating to
employee benefit plans, or in the imposition of any Lien on any of the rights,
properties or assets of the Company or any ERISA Affiliate pursuant to Title 1
or IV of ERISA or such penalty or excise tax provisions, if such liability or
Lien, taken together with any other such liabilities or Liens then existing,
could reasonably be expected to have a Material Adverse Effect;


 


(g)  Notices from Governmental Authority  — promptly, and in any event within 30 days
of receipt thereof, copies of any notice to the Company or any Subsidiary from
any Governmental Authority relating to any order, ruling, statute or other law
or regulation that could reasonably be expected to have a Material Adverse
Effect;


 


(h)  Litigation  — to the extent not prohibited by applicable law or
regulation, details of any litigation, arbitration or administrative
proceedings which are current, threatened or pending, which affect the Company
or any of its Subsidiaries and which, if adversely determined, could reasonably
be expected to have a Material Adverse Effect, as soon as practicable after the
same shall be instituted or, to the knowledge of the


 


57

















 


Company, threatened;


 


(i)  Information delivered to Other Parties  — promptly upon the receipt or delivery
thereof, a copy of all other financial statements or other information about
the Company and its Subsidiaries (excluding drawdown notices and other routine
communications and certificates of an administrative nature) sent or made
available generally by the Company to its shareholders and institutional
lenders (or any class of them (including, without limitation, any tenders under
the Bank Facility or any Committed Medium-Term Financing or any Committed
External Financing)), to the extent the information contained therein has not
already been delivered to each holder of Notes;


 


(j)  Rule 144A  —
promptly upon the request of any holder, information required to comply with 17
CFR §230.144A (Rule 144A under the Securities Act), as amended from time to
time; and


 


(k)  Requested Information  — with reasonable promptness and subject to
section 7.4, such other data and information relating to the business,
operations, affairs, financial condition, assets or properties of the Company
or any of its Subsidiaries or relating to the ability of the Company to perform
its obligations hereunder and under the Notes, or the ability of any Guarantor
to perform its obligations under its Subsidiary Guarantee, as from time to time
may be reasonably requested by any such holder of Notes (other than a Competing
Person).


 


7.2.                            Officer’s Certificates, etc.


 


Each set of financial statements delivered to
a holder of Notes pursuant to Section 7.1(A)(a), Section 7.1(A)(b), Section
7.1(A)(d), Section 7.1(B)(a), Section 7.1(B)(b), or Section 7.1(B)(c) hereof
shall be accompanied by a certificate of Senior Officers of the Company:


 


(a) 
setting forth the information (including detailed calculations)


 


58

















 


required in order to establish whether the
Company was in compliance with the requirements of Section 10.3 to Section 10.7
hereof, inclusive, during the quarterly, six-month or annual period, as appropriate,
covered by the statements then being furnished pursuant to Section 7.1(A) or
Section 7.1(B) (including with respect to each such Section, where applicable,
the calculations of the maximum or minimum amount, ratio, or percentage, as the
case may be, permissible under the terms of such Sections, and the calculation
of the amount, ratio or percentage then in existence) (for the avoidance of
doubt, such information relating to compliance with Section 10.4(c)(iii) need
only contain a calculation of the amount of Asset Dispositions that would have
been permitted during such period together with a statement that actual Asset
Dispositions for such period did not exceed such permitted amount, and, if
applicable, details as to any Debt Prepayment Application or Property
Reinvestment Application);


 


(b) 
setting forth that such officer has reviewed the relevant terms hereof
and has made, or caused to be made, under his or her supervision, a review of
the transactions and conditions of the Company and the Subsidiaries from the
beginning of the quarterly, six-month or annual period, as appropriate, covered
by the statements then being furnished pursuant to Section 7.1(A) or Section
7.1(B) to the date of the certificate and that such review shall not have
disclosed the existence during such period of any condition or event that
constitutes a Default or an Event of Default or, if any such condition or event
existed or exists, specifying the nature and period of existence thereof and
what action the Company shall have taken or proposes to take with respect
thereto; and


 


(c) (i) 
designating the Subsidiaries which are to be Material Subsidiaries from
the date of such certificate to the date of the next such certificate, (ii)
listing such Material Subsidiaries in descending order of their contribution to
Consolidated EBIT (and, where the Consolidated EBIT for two or more Material
Subsidiaries is the same, in descending order of their contribution to
Consolidated Total Assets) for the most recently ended Accounting Period, (iii)
stating that, as at the end of the


 


59

















 


most recent Accounting Period, the aggregate
of the EBIT and Total Assets of all such Material Subsidiaries plus the EBIT
and Total Assets of the Company accounts for at least 80% of Consolidated EBIT
and 80% of Consolidated Total Assets, respectively, and (iv) setting out the
proportion which the aggregate EBIT and Total Assets of the Company and all
such Material Subsidiaries bears to the Consolidated EBIT and Consolidated
Total Assets as at the end of the most recently ended Accounting Period (it
being understood that, in making such designation, the Company shall procure
that the list of Material Subsidiaries shall be such that the aggregate of the
EBIT and Total Assets of each Material Subsidiary plus the EBIT and Total
Assets of the Company for, and as at the end of, the most recently ended
Accounting Period accounts for at least 80% of the Consolidated EBIT and 80% of
the Consolidated Total Assets for, and as at the end of, such Accounting
Period).


 


7.3.                            Inspection.


 


Subject to Section 7.4, the Company shall
permit each Noteholder and any other holder of Notes that is an Institutional
Investor (other than a Competing Person) and each Noteholder’s or such other holder’s
agents or representatives, upon reasonable prior notice and during normal
business hours:


 


(a)  No Default — if no Default or Event of Default then exists, at the
expense of such holder, to visit the principal executive office of the Company,
to discuss the affairs, finances and accounts of the Company and the Material
Subsidiaries with the officers and executive directors of the Company, and
(with the consent of the Company, which consent will not be unreasonably
withheld) its independent chartered accountants, and (with the consent of the
Company, which consent will not be unreasonably withheld) to visit the other
offices and properties of the Company and any Subsidiary all as often as may be
reasonably requested; and


 


(b)  Default  —
if a Default or Event of Default then exists, at the expense of the Company, to
visit and inspect any of the offices or properties of the


 


60

















 


Company or any Subsidiary, to examine all
their respective books of account, records, reports and other papers, to make
copies and extracts therefrom, and to discuss their respective affairs,
finances and accounts with their respective officers, executive directors and
independent chartered accountants (and by this provision the Company authorizes
said chartered accountants to discuss the affairs, finances and accounts of the
Company and the Subsidiaries).


 


7.4.                            Limitation on Disclosure.


 


Neither the Company nor any of its
Subsidiaries shall be required to disclose any materials or information
pursuant to Section 7.1(A)((l), Section 7.1(B)(k) or Section 7.3 if the
disclosure of such materials or information (a) based upon written advice of
counsel to the Company (addressed to the holders of the Notes at the Company’s
expense), would be prohibited by law or by order or decree of any Governmental
Authority, court or arbitral body or by the terms of an obligation of
confidentiality comprised in any agreement binding on the Company or any of its
Subsidiaries (so long as such agreement is generally applicable to all
institutions lending to the Company or such Subsidiary and has not been entered
into in contemplation of this Section 7.4 and provided that the Company shall
make a good faith attempt to obtain promptly a waiver of such confidentiality
obligations to permit such disclosures to the holders), or (b) as advised by a
responsible official of the LSE or any other exchange on which the Company or
any Subsidiary has listed securities, would require the Company or any of its
Subsidiaries to make public disclosure of such information to comply with any
of its continuing obligations under the rules of such exchange provided that
the Company shall have disclosed the nature of this Agreement, the Notes and
the obligations of the Company in respect thereto to such exchange and the
Company shall, if so requested by a holder of a Note, submit to such exchange
such factual submissions and other representations as such holder of a Note may
request in order to obtain confirmation from responsible officials of such
exchange that the disclosure of such information would require public
disclosure or is otherwise prohibited by the requirements of such exchange
unless such information is


 


61

















 


publicly disclosed (provided that, notwithstanding the foregoing, where
the examination or inspection of such materials or information is being
requested at any time when a Default or an Event of Default then exists, (i)
the Company shall be obligated to disclose to the holders any such information
the disclosure of which would give rise to a disclosure obligation under the
rules or regulations of such exchange even if such disclosure would require the
Company or any Subsidiary to make public disclosure thereof to comply with such
rules and regulations, and (ii) in any case where such disclosure is prohibited
by law or by order or decree or by any agreement of confidentiality as
described in clause (a) above, the Company will use its best efforts to have
such prohibition removed or waived so as to permit the disclosure of such
materials or information to the holders of the Notes).  Notwithstanding anything herein to the
contrary, the Company shall be required to disclose, and shall procure that its
Subsidiaries shall disclose, all information (including, without limitation,
the information described in this Section 7.4) to the Noteholders that has been
disclosed or otherwise provided (in any manner whatsoever) directly or
indirectly to any lender under the Bank Facility Agreement, any Committed
Medium-Term Financing and/or a Committed External Financing.


 


8.                                      PAYMENTS.


 


8.1.                            Maturity Dates.


 


Except for any prepayment made pursuant to
other Sections of this Agreement, the entire principal amount of each Series of
the Notes shall be due and payable on the maturity date thereof.


 


8.2.                            Interest.


 


(a) The Company shall pay interest on the
Notes computed on the basis of a 360-day year of twelve 30-day months, and such
interest shall accrue, at the respective rates provided for below, on the
unpaid principal balance of the Notes, payable semi-annually on November 23 and
May 23 in each


 


62

















 


year, until such principal shall have become
due and payable:


 


(i)                                  with
respect to the Series A Notes (A) prior to the Effective Date, at the rate of
7.94% per annum, (B) on and after the Effective Date but prior to and including
the Normalization Date, at the rate of 9.19% per annum, and (C) after the
Normalization Date, at the rate of 8.94% per annum;


 


(ii)                              with
respect to the Series B Notes (A) prior to the Effective Date, at the rate of
8.06% per annum, (B) on and after the Effective Date but prior to and including
the Normalization Date, at the rate of 9.31% per annum, and (C) after the
Normalization Date, at the rate of 9.06% per annum;


 


(iii)                          with
respect to the Series C Notes (A) prior to the Effective Date, at the rate of
8.16% per annum, (B) on and after the Effective Date but prior to and including
the Normalization Date, at the rate of 9.41% per annum, and (C) after the
Normalization Date, at the rate of 9.16% per annum; and


 


(iv)                            with
respect to the Series D Notes (A) prior to the Effective Date, at the rate of
8.75% per annum, (B) on and after the Effective Date but prior to and including
the Normalization Date, at the rate of 10.00% per annum, and (C) after the
Normalization Date, at the rate of 9.75% per annum.


 


(b) The Company shall pay interest on any
overdue payment (including any overdue prepayment) of principal, any overdue
payment of interest and any overdue payment of any Make-Whole Amount or
Modified Make-Whole Amount computed on the basis of a 360-day year of twelve
30-day months, and such interest shall accrue, at the respective rates provided
for below, payable semi-annually on November 23 and May 23 in each year (or, at
the option of any Noteholder, on demand):


 


(i)                                  with
respect to the Series A Notes (A) prior to the Effective


 


63

















 


Date, at the rate equal to the greater of (1)
9.94% per annum and (2) 2.00% per annum above the rate of interest publicly
announced by Citibank, N.A. from time to time in New York, New York as its
“base” or “prime” rate, (B) on and after the Effective Date but prior to and
including the Normalization Date, at the rate equal to the greater of (1)
11.19% per annum and (2) 2.00% per annum above the rate of interest publicly
announced by Citibank, N.A. from time to time in New York, New York as its
“base” or “prime” rate and (C) after the Normalization Date, at the rate equal
to the greater of (1) 10.94% per annum and (2) 2.00% per annum above the rate
of interest publicly announced by Citibank, N.A. from time to time in New York,
New York as its “base” or “prime” rate;


 


(ii)          with
respect to the Series B Notes (A) prior to the Effective Date, at the rate
equal to the greater of (1) 10.06% per annum and (2) 2.00% per annum above the
rate of interest publicly announced by Citibank, N.A. from time to time in New
York, New York as its “base” or “prime” rate, (B) on and after the Effective
Date but prior to and including the Normalization Date, at the rate equal to
the greater of (1) 11.31% per annum and (2) 2.00% per annum above the rate of
interest publicly announced by Citibank, N.A. from time to time in New York,
New York as its “base” or “prime” rate, and (C) after the Normalization Date,
at the rate equal to the greater of (1) 11.06% per annum and (2) 2.00% per
annum above the rate of interest publicly announced by Citibank, N.A. from time
to time in New York, New York as its “base” or “prime” rate;


 


(iii)         with
respect to the Series C Notes (A) prior to the Effective Date, at the rate
equal to the greater of (1) 10.16% per annum and (2) 2.00% per annum above the
rate of interest publicly announced by Citibank, N.A. from time to time in New
York, New York as its “base” or “prime” rate, (B) on and after the Effective
Date but prior to and including the Normalization Date, at the rate equal to
the greater of (1) 11.41% per annum and (2) 2.00% per annum above the


 


64

















 


rate of interest publicly announced by
Citibank, N.A. from time to time in New York, New York as its “base” or “prime”
rate and (C) after the Normalization Date, at the rate equal to the greater of
(1) 11.16% per annum and (2) 2.00% per annum above the rate of interest
publicly announced by Citibank, N.A. from time to time in New York, New York as
its “base” or “prime” rate;


 


(iv)         with
respect to the Series D Notes (A) prior to the Effective Date, at the rate
equal to the greater of (1) 10.75% per annum and (2) 2.00% per annum above the
rate of interest publicly announced by Citibank, N.A. from time to time in New
York, New York as its “base” or “prime” rate, (B) on and after the Effective
Date but prior to and including the Normalization Date, at the rate equal to
the greater of (1) 12.00% per annum and (2) 2.00% per annum above the rate of
interest publicly announced by Citibank, N.A. from time to time in New York,
New York as its “base” or “prime” rate and (C) after the Normalization Date, at
the rate equal to the greater of (1) 11.75% per annum and (2) 2.00% per annum
above the rate of interest publicly announced by Citibank, N.A. from time to
time in New York, New York as its “base” or “prime” rate.


 


8.3.                            Prepayments with Make-Whole Amount.


 


The Company may, at its option, upon notice
as provided below, prepay at any time all, or from time to time any part of,
the Notes, in an amount not less than 5% of the aggregate principal amount of
the Notes then outstanding in the case of a partial prepayment, at 100% of the
principal amount so prepaid plus the Make-Whole Amount determined for the
prepayment date with respect to such principal amount.  The Company will give each holder of Notes
written notice of each optional prepayment under this Section 8.3 not less than
30 days and not more than 60 days prior to the date fixed for such prepayment .
Each such notice shall specify such prepayment date, the aggregate principal
amount of the Notes and of each Series of Notes to be prepaid on such date, the
principal amount and Series of each Note held by such holder to be prepaid
(determined in accordance


 


65

















 


with Section 8.4), and the interest to be paid on the prepayment date
with respect to such principal amount being prepaid, and shall be accompanied
by a certificate of Senior Officers of the Company as to the estimated
Make-Whole Amount due in connection with such prepayment (calculated as if the
date of such notice were the date of the prepayment), setting forth the details
of such computation.  Three Business
Days prior to such prepayment, the Company shall deliver to each holder of
Notes a certificate of Senior Officers of the Company specifying the
calculation of such Make-Whole Amount as of the specified prepayment date.


 


8.4.                            Allocation of Partial Optional
Prepayments.


 


In the case of each partial prepayment of the
Notes pursuant to Section 4.7(a) or Section 8.3, the principal amount of the
Notes to be prepaid shall be allocated among all of the Notes at the time
outstanding (without regard to Series) in proportion, as nearly as practicable,
to the respective unpaid principal amounts thereof not therefore called for
prepayment.


 


8.5.                            Maturity; Surrender, etc.


 


In the case of each prepayment of Notes
pursuant to Section 4.7(a), Section 8.3, Section 8.7 or Section 8.8, the
principal amount of each Note to be prepaid shall mature and become due and
payable on the date fixed for such prepayment, together with interest on such
principal amount accrued to such date and the applicable Make-Whole Amount or
Modified Make-Whole Amount, if any. 
From and after such date, unless the Company shall fail to pay such
principal amount when so due and payable, together with the interest and
Make-Whole Amount or Modified Make-Whole Amount, if any, as aforesaid, interest
on such principal amount shall cease to accrue.  Any note paid or prepaid in full pursuant to Section 8.3 shall be
surrendered to the Company and cancelled and shall not be reissued, and no Note
shall be issued in lieu of any prepaid principal amount of any Note.


 


66

















 


8.6.                            Purchase of Notes.


 


The Company will not, nor will it permit any
Subsidiary or other Affiliate to, purchase, redeem, prepay or otherwise
acquire, directly or indirectly, any of the outstanding Notes except upon the
payment or prepayment of the Notes in accordance with the terms of this
Agreement and the Notes.  The Company
will promptly cancel all Notes acquired by it, any Subsidiary or any other
Affiliate pursuant to any payment or prepayment of Notes pursuant to any
provision of this Agreement and no Notes may be issued in substitution or
exchange for any such Notes.


 


8.7.                            Optional prepayment of Notes for Tax
Reasons.


 


If a Special Tax Event occurs and, by reason
thereof, the Company would, on the occasion of any interest payment in respect
of the Notes, become obligated to make Additional Payments in respect of such
payment of interest to one or more holders of Notes, the Company may give the
holders of all Notes in respect of which such Additional Payments are to be
made (such holders being referred to as the “Affected Holders”) irrevocable written notice (a “Tax Prepayment Notice”) of
the prepayment of all (but not less than all) of the Notes of all Affected
Holders not less than 30 nor more than 60 days prior to the prepayment date
specified in such notice, provided that the prepayment date is less than 18
months after the occurrence of such Special Tax Event, and provided further
that the Company will not give any Tax Prepayment Notice pursuant to this
Section 8.7 unless the aggregate of all Additional Payments then payable on all
Notes in respect of interest payments due within six months after such Tax Prepayment
Notice is equal to or exceeds 5% of the aggregate amount of such interest
payments on all Notes of all Affected Holders during such period.  Each Tax Prepayment Notice shall specify the
prepayment date and the circumstances giving rise to the Company’s obligation
to make Additional Payments and the amount thereof and stating that the Notes
of all Affected Holders shall be prepaid on that date at the principal amount
so to be prepaid, together with accrued interest thereon to the date fixed for such
prepayment, plus the Modified Make-Whole Amount for each such Note, unless, in
the case of any Affected Holder, such Affected Holder shall, by written notice
given to the Company no more than 20 days after receipt of the


 


67

















 


Tax Prepayment Notice, reject such prepayment (a “Rejection Notice”).


 


The form of Rejection Notice shall accompany
the Tax Prepayment Notice and shall state that execution and delivery thereof
shall (a) terminate the Company’s right to prepay such Affected Holder’s Notes
by reason of the Tax Prepayment Notice, and (b) operate as a permanent waiver
of such Affected Holder’s right to receive the Additional Payments arising as a
result of the circumstances described in the Tax Prepayment Notice in respect
of all future payments of interest on such Affected Holder’s Notes (but not
such Affected Holder’s right to receive any Additional Payments which arise out
of payments made prior to the date of such proposed prepayment or by reason of circumstances
not described in the Tax Prepayment Notice or which exceed the amount of the
Additional Payments described in the Tax Prepayment Notice), which waiver shall
be binding upon all subsequent transferees of such Notes, and, upon request of
the Company and at its expense, such Affected Holder shall present each of its
Notes to the Company for the purpose of making a notation of such waiver
thereon.  The Tax Prepayment Notice
having been given as aforesaid to each Affected Holder, the principal amount of
all Notes specified therein, together with accrued interest thereon to the date
of such prepayment, plus such Modified Make-Whole Amount, shall become due and
payable on such prepayment date unless such Affected Holder shall timely give a
Rejection Notice as aforesaid or unless a Default or Event of Default shall
have occurred and be continuing on such prepayment date.  Three Business Days prior to such
prepayment, the Company shall deliver to each Affected Holder a certificate of
Senior Officers of the Company specifying the calculation of such Modified
Make-Whole Amount as of such specified prepayment date.  The provisions of this Section 8.7 shall not
be applicable (i) if the payment of the Additional Payments arises under
circumstances where the Taxing Jurisdiction under Section 22.1 is not the
United Kingdom and (ii) (A) if the obligation to pay Additional Payments arises
by reason of a merger of the Company permitted by Section 10.2 or other
analogous permitted transactions referred to in such Section or (B) where the
obligation to pay Additional Payments would not have arisen had the Company
made such payments through the United Kingdom.


 


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8.8.                            Change in Control.


 


Immediately after the occurrence of a Change
in Control or a Control Event, the Company will give written notice thereof to
the holders of all outstanding Notes, which notice shall:


 


(a) refer specifically to this Section 8.8;


 


(b) describe the Change in Control or Control
Event in reasonable detail; and


 


(c) in the case that a Change in Control has
occurred:


 


(i)                                  contain
an offer to prepay all Notes at the price specified below on the date therein
specified (the “Change in Control Prepayment Date”), which shall be a Business Day not less than 30 nor more than 45 days
after the date of such notice;


 


(ii)                              specify
the Response Date (as defined below) in respect thereof; and


 


(iii)                          indicate
the Company’s estimate of the Make-Whole Amount with respect to such prepayment
(calculated as if the date of such notice were the date of prepayment).


 


Each holder of a Note shall notify the
Company of such holder’s acceptance or rejection of any such offer described in
clause (c) above by giving written notice (which shall be irrevocable) of such
acceptance or rejection to the Company at least 10 days prior to the Change in
Control Prepayment Date (the “Response Date”); provided, however, that the failure by the holder
of a Note to respond to such offer in writing on or before the Response Date
shall be deemed to be an acceptance of such offer in respect of such Change in
Control.  Three Business Days prior to
such payment, the Company shall deliver to each holder of Notes a certificate
of Senior Officers of the Company specifying the calculation of such Make-Whole
Amount as of the specified Change in Control Prepayment Date.  The Company


 


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shall prepay on the Change in Control Prepayment Date all of the Notes
held by the holders as to which such offer has been so accepted, at the
principal amount of such Note, together with interest accrued thereon to the
Change in Control Prepayment Date, plus an amount equal to the Make-Whole
Amount with respect to such Note.  If
any holder shall reject such offer, such holder shall be deemed to have waived
its rights under this Section 8.8 to require prepayment of all Notes held by
such holder in respect of such Change in Control but not in respect of any
subsequent Change in Control.


 


Notwithstanding anything to the contrary in
this Section 8.8, to the extent that the Bank Facility, any Committed
Medium-Term Financing or any Committed External Financing is cancelled and
outstandings thereunder are declared to become due and payable thereunder or
are required to be repaid in connection with a Control Event or a Change in
Control (the “Bank
Control Payment Date”) prior to
the Change in Control Prepayment Date, irrespective of whether such Bank
Control Payment Date is prior to the Response Date or prior to the date on
which the Company gives notice of a Change of Control or a Control Event to the
holders of all outstanding Notes, the Change in Control Payment Date shall be
deemed to be such Bank Control Payment Date and the failure by any holder of a
Note to respond to any offer (if any) to prepay on or before such date shall be
deemed an acceptance of such offer in respect of such Change of Control or
Control Event.


 


8.9.                            Make-Whole Amount; Modified Make-Whole
Amount.


 


The term “Make-Whole Amount” means, with respect to any Note of any Series, an amount equal to the
excess, if any, of the Discounted Value of the Remaining Scheduled Payments
with respect to the Called Principal of such Note of such Series over the
amount of such Called Principal, provided that the Make-Whole Amount may in no
event be less than zero. For the purposes of determining the Make-Whole Amount,
the following terms have the following meanings:


 


“Called
Principal” means, with respect to any Note of any Series, the
principal of such Note that is to be prepaid pursuant to Section 4.7(a),


 


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Section 8.3, Section 8.7 or Section 8.8 or
has become or is declared to be immediately due and payable pursuant to Section
12.1, as the context requires.


 


“Discounted Value” means, with respect to the Called Principal of any
Note of any Series, the amount obtained by discounting all Remaining Scheduled
Payments with respect to such Called Principal from their respective scheduled
due dates to the Settlement Date with respect to such Called Principal, in
accordance with accepted financial practice and at a discount factor (applied
on the same periodic basis as that on which interest on such Series of Notes is
payable) equal to the Reinvestment Yield with respect to such Called Principal.


 


“Reinvestment Yield”
means, with respect to the Called Principal of any Note of any Series, 0.50%
over the yield to maturity implied by (a) the yields reported, as of 10:00 A.M.
(New York City time) on the third Business Day preceding the Settlement Date
with respect to such Called Principal, on the display designated as “Page PX1” on
the Bloomberg Financial Markets Commodities News (or such other display as may
replace Page PX1 on the Bloomberg Financial Markets Commodities News) for
“on-the-run” U.S.  Treasury securities
having a maturity equal to the Remaining Average Life of such Called Principal
as of such Settlement Date, or (b) if such yields are not reported as of such
time or the yields reported as of such time are not ascertainable, the Treasury
Constant Maturity Series Yields reported, for the latest day for which such
yields have been so reported as of the third Business Day preceding the
Settlement Date with respect to such Called Principal, in Federal Reserve
Statistical Release H.15 (519) (or any comparable successor publication) for
“on-the-run” U.S. Treasury securities having a constant maturity equal to the
Remaining Average Life of such Called Principal as of such Settlement Date.
Such implied yield will be determined, if necessary, by (i) converting U.S.
Treasury bill quotations to bond-equivalent yields in accordance with accepted
financial practice, and (ii) interpolating linearly between (x) the
“on-the-run” U.S. Treasury security with the remaining life closest to and


 


71

















 


greater than the Remaining Average Life, and (y) the
“on-the-run” U.S. Treasury security with the remaining life closest to and less
than the Remaining Average Life.


 


“Remaining
Average Life” means, with respect to any Called Principal of any
Series of Notes, the number of years (calculated to the nearest one-twelfth
year) obtained by dividing (x) such Called Principal into (y) the sum of the
products obtained by multiplying (a) the principal component of each Remaining
Scheduled Payment with respect to such Called Principal by (b) the number of
years (calculated to the nearest one-twelfth year) that will elapse between the
Settlement Date with respect to such Called Principal and the scheduled due
date of such Remaining Scheduled Payment.


 


“Remaining
Scheduled Payments” means, with respect to the Called Principal of any
Note of any Series, all payments of such Called Principal and interest thereon
that would be due after the Settlement Date with respect to such Called
Principal if no payment of such Called Principal were made prior to its
scheduled due date, provided that if such Settlement Date is not a date on
which interest payments are due to be made under the terms of the Notes of such
Series, then the amount of the next succeeding scheduled interest payment will
be reduced by the amount of interest accrued to such Settlement Date and
required to be paid on such Settlement Date Pursuant to Section 4.7(a), Section
8.3, Section 8.7, Section 8.8 or Section 12.1.


 


“Settlement
Date” means, with respect to the Called Principal of any
Note of any Series, the date on which such Called Principal is to be prepaid
pursuant to Section 4.7(a), Section 8.3, Section 8.7 or Section 8.8 or has
become or is declared to be immediately due and payable pursuant to Section
12.1, as the context requires.


 


The term “Modified Make-Whole Amount” means, with
respect to any Note of any Series, the Make-Whole Amount therefor calculated on
the basis of a


 


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“Reinvestment Yield” in which a spread of “0.75%” has been substituted for
a spread of “0.50%”.


 


The Make-Whole Amount and Modified Make-Whole
Amount shall be calculated for any prepayment or repayment of the Notes based
on the interest rate, interest payment and maturity date as set forth in the
Existing Notes and the Existing Note Purchase Agreements in each case as in
effect immediately prior to the Effective Date.


 


The Company acknowledges, and the parties
hereto agree, that the right of each holder to have maintained its investment
in the Notes to the maturity date thereof free from prepayment by the Company
is a valuable right and that the provision for the payment of a Make-Whole
Amount and Modified Make-Whole Amount by the Company, in the event that the
Notes are prepaid under the terms of this Agreement or are accelerated as a
result of an Event of Default, is intended to provide compensation for the
deprivation of such right in connection with the circumstances under which the
transactions contemplated by this Agreement (including, without limitation, the
Restructuring Transaction) have been agreed and under any circumstances arising
out of an Event of Default.


 


9.                                      AFFIRMATIVE COVENANTS.


 


The Company covenants
that so long as any of the Notes are outstanding:


 


9.1.                            Compliance with Law.


 


The Company will and will cause each member
of the Group to comply with all laws, ordinances or governmental rules or
regulations to which each of them is subject, including, without limitation, Environmental
Laws, and will obtain, maintain in effect and comply with all licenses,
certificates, permits, franchises, consents and other governmental
authorizations required under any such applicable law, ordinance, governmental
rule or regulation or which is necessary to the operation and ownership of
their respective properties or to the conduct of their respective businesses,
in each case to the extent necessary to ensure that non-compliance


 


73

















 


with such laws, ordinances or governmental rules or regulations or the
failure to obtain or maintain in effect such licenses, certificates, permits,
franchises, consents and other governmental authorizations could not,
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect.  The Company will
promptly upon the request of any Noteholder provide such Noteholder with
certified copies of all such material licenses, certificates, permits, franchises,
consents and other governmental authorizations as may be required under any
applicable law or regulation to enable the Company to perform its obligations
under, or for the validity or enforceability of, any Financing Document.


 


9.2.                            Insurance.


 


The Company will and will cause each of the Material
Subsidiaries to maintain, with financially sound and reputable insurers, such
insurance with respect to their respective properties and businesses against
such casualties and contingencies, of such types, on such terms and in such
amounts (including deductibles, co-insurance and self-insurance, if adequate
reserves are maintained with respect thereto) as is customary in the case of
entities of established reputations engaged in the same or a similar business
and similarly situated.


 


9.3.                            Maintenance of Properties.


 


The Company will and will cause each of the
Material Subsidiaries to maintain and keep, or cause to be maintained and kept,
their respective properties in good repair, working order and condition (other
than ordinary wear and tear), so that the business carried on in connection
therewith may be properly conducted at all times, provided that this Section
9.3 shall not prevent the Company or any Material Subsidiary from discontinuing
the operation and the maintenance of any of its properties if such
discontinuance is desirable in the conduct of its business and the Company has
concluded that such discontinuance could not, individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect.


 


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9.4.                            Payment of Taxes
and Claims.


 


The Company will and will cause each of the
Material Subsidiaries to file all income and other Material tax returns
required to be filed in any jurisdiction and to pay and discharge all taxes
shown to be due and payable on such returns and all other taxes, assessments,
governmental charges, or levies imposed on them or any of their properties,
assets, income or franchises, to the extent such taxes and assessments have
become due and payable and before they have become delinquent, and all claims
for which sums have become due and payable that have or might become a Lien on
properties or assets of the Company or any Material Subsidiary, provided that
neither the Company nor any Material Subsidiary need pay any such tax or
assessment or claims if (a) the amount, applicability or validity thereof is
contested by the Company or such Material Subsidiary on a timely basis in good
faith and in appropriate proceedings, and the Company or such Material Subsidiary
has established adequate reserves or provisions therefor in accordance with,
and to the extent required by, Applicable GAAP on the books of the Company or
such Material Subsidiary, or (b) the nonpayment of all such taxes, assessments
and claims in the aggregate could not reasonably be expected to have a Material
Adverse Effect.


 


9.5.                            Corporate Existence, etc.


 


Subject to Section 10.2, the Company will at
all times preserve and keep in full force and effect its corporate
existence.  Subject to Section 10.2 and
Section 10.4, the Company will at all times preserve and keep in full force and
effect the corporate existence of each of its Material Subsidiaries and all
rights and franchises of the Company and its Material Subsidiaries unless, in
the good faith judgment of the Company, the termination of or failure to
preserve and keep in full force and effect such corporate existence, right or
franchise could not, individually or in the aggregate, have a Material Adverse
Effect.


 


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9.6.                            Pari Passu Ranking.


 


The obligations of the Company under the
Notes and this Agreement, and the obligations of the Guarantors under the
Subsidiary Guarantees, will at all times rank at least pari passu, without
preference or priority, with all of such Person’s other outstanding obligations
in respect of its senior, unsecured and unsubordinated Financial Indebtedness,
present and future, except for those obligations that are mandatorily preferred
by law and not by reason of contract.


 


9.7.                            Maintenance of Ownership of
Guarantors.


 


The Company shall at all times own, directly
or indirectly, at least 90% of the share capital and all other equity interests
of each Guarantor.


 


9.8.                            Committed External Financing.


 


Until the Normalization Date, the Company
shall have available, on or prior to June 30, 2004 and at all times thereafter,
loan or other credit facilities (other than letter of credit or documentary
credit facilities) pursuant to a written commitment by a bank or other
financial institution in an aggregate amount of at least £60,000,000 for which
the period until maturity or termination (or reduction below £60,000,000) of
such commitment and the borrowings thereunder have, on June 30, 2004 and on
each June 30 until the Normalization Date, at least 364 days remaining and
which are not capable of being demanded or withdrawn at any time during such
period (other than following an event of default thereunder) (such financing,
the “Committed
External Financing”).


 


9.9.                            Executive Order 13224 of September 23, 2001.


 


The Company will ensure that no member of the
Group will become a Person or entity described by Section 1 of Executive Order
13224 of September 23, 2001 Blocking Property and Prohibiting Transactions With
Persons Who Commit, Threaten to Commit, or Support Terrorism, Exec. Order No.
13224 66 Fed. Reg. 49,079 (2001), and neither the Company nor any Subsidiary
will knowingly become engaged in any dealings or transactions, or be otherwise
associated, with


 


76

















 


any such Persons or entities in violation of such Executive Order.


 


9.10.                     ERISA.


 


(a) As soon as possible, and in any event
within 30 days, after any member of the Group knows or has reason to know that
any of the events or conditions mentioned in clause (b) below have occurred or
exist, where such event or condition has or is reasonably likely to have a
Material Adverse Effect, it will furnish to the Noteholders a statement signed
by a senior financial officer of the relevant company (being any officer of the
relevant member of the Group, fulfilling any of the following roles: financial
officer, group finance director, principal accounting officer, treasurer or
head of corporate finance of the relevant member of the Group) (without personal
liability) setting forth the nature of such event or condition and the action,
if any, which the relevant company or an ERISA Affiliate proposes to take with
respect thereto.


 


(b) The events or conditions mentioned in
clause (a) above are:


 


(i)                                  any
reportable event, as defined in Section 4043(c) of ERISA with respect to a US
Plan, as to which the PBGC has not by regulation waived the requirement of
Section 4043(a) of ERISA that it be notified within 30 days of the occurrence
of such event;


 


(ii)                              the failure
to meet the minimum funding standards of Section 412 of the US Tax Code of
Section 302 of ERISA with respect to a US Plan or any request for a waiver
under Section 412(d) of the US Tax Code or Section 303 of ERISA, or for an
extension under Section 412(e) of the US Tax Code or Section 304 of ERISA for
any US Plan;


 


(iii)                          the
distribution under Section 4041(c) of ERISA of a notice of intent to terminate
any US Plan;


 


(iv)                            the
institution by PBGC of proceedings under Section 4042 of


 


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ERISA for the termination of, or the
appointment of a trustee to administer, any US Plan, or the receipt by any
member of the Group or any ERISA Affiliate of a notice that such action has
been taken by the PBGC with respect to a US Multiemployer Plan;


 


(v)                                the
complete or partial withdrawal from a US Multiemployer Plan by any member of
the Group or any ERISA Affiliate that results in liability under Section 4201
or 4204 of ERISA or the receipt by any member of the Group or any ERISA
Affiliate of notice from a US Multiemployer Plan that it is in reorganization
or insolvency pursuant to Section 4241 or 4245 of ERISA or that it intends to
terminate or has terminated under Section 4041A of ERISA;


 


(vi)                            the
institution of a proceeding by a fiduciary of any US Multiemployer Plan against
any member of the Group or any ERISA Affiliate to enforce Section 515 of ERISA,
which proceedings are not dismissed within 30 days;


 


(vii)                        the
adoption of an amendment to any US Plan pursuant to Section 307 of ERISA that
requires the provision of security to such US Plan; or


 


(viii)                    the conditions
for the imposition of a Lien under Section 302(f) of ERISA shall have been met
with respect to any US Plan.


 


(c) The Company shall furnish to any Noteholder,
promptly after the request of such Noteholder, copies of each Schedule B
(actuarial information) to the annual report (Form 5500) filed with respect to
each US Plan.


 


(d) Each member of the Group and its ERISA
Affiliates shall be, and remain, in compliance in all material respects with
all laws and regulations relating to each of its US Plans.


 


(e) Each member of the Group and its ERISA
Affiliates shall ensure


 


78

















 


that no event or condition exists at any time
in relation to a US Plan which is reasonably likely to result in the imposition
of a Lien on any of its assets pursuant to Title I or IV or ERISA which would
be reasonably likely to have a Material Adverse Effect.


 


9.11.                     Environmental Laws.


 


The Company shall, and shall procure that its
Subsidiaries shall, comply with and carry out its business in accordance with
all Environmental Laws necessary for the conduct of its business where any
failure to comply or carry out its business in accordance with the
Environmental Laws might have a Material Adverse Effect.


 


10.                               NEGATIVE COVENANTS.


 


The Company covenants that so long as any of
the Notes are outstanding:


 


10.1.                     Transactions with Affiliates.


 


The Company will not, and will not permit any
Subsidiary to, enter into, directly or indirectly, any Material transaction or
Material group of related transactions (including, without limitation, the
purchase, lease, sale or exchange of properties of any kind or the rendering of
any service) with any Affiliate (other than the Company, a Guarantor or a
Wholly-Owned Subsidiary), except (a) in the ordinary course and pursuant to the
reasonable requirements of the Company’s or such Subsidiary’s business and upon
fair and reasonable terms no less favorable to the Company or such Subsidiary
than would be obtainable in a comparable arm’s-length transaction with a Person
not an Affiliate and (b) the Project Schultz Transaction.


 


10.2.                     Merger, Consolidation, etc.


 


The Company will not, and will not permit any
Subsidiary to, consolidate,


 


79

















 


merge or amalgamate with or into any other Person or convey, transfer
or lease all or substantially all of its properties in a single transaction or
series of transactions to any Person (except that a Subsidiary (other than a
Guarantor) may (x) consolidate or amalgamate with or merge with, or convey,
transfer or lease all or substantially all of its properties in a single
transaction or series of transactions to, the Company or any other Subsidiary
(including, without limitation, a Person which becomes a Subsidiary in
connection with such transaction or series of transactions), so long as the
Company shall have at least the same degree of Control with respect to the
Subsidiary which survives such consolidation, amalgamation, or merger or the
corporation that purchases, leases or otherwise acquires all or substantially
all of the properties of such Subsidiary as it had with respect to the first
Subsidiary, (y) convey, transfer or lease all or substantially all of its
properties (or consolidate, merge or amalgamate with another Person if the sole
purpose of such transaction is to effect the disposition, directly or
indirectly, of such Subsidiary by the Company) in compliance with Section 10.4
or (z) reorganize on a solvent basis where all of the assets of such Subsidiary
remain within the Group, so long as the Company shall have at least the same
degree of Control with respect to the Subsidiaries which acquire all or
substantially all of the properties of such Subsidiary as it had with respect
to the first Subsidiary), provided that the foregoing restriction does not
apply to the consolidation, merger or amalgamation of the Company or a
Guarantor with, or the conveyance, transfer or lease of all or substantially
all of the properties of the Company or a Guarantor in a single transaction or
series of transactions to, any Person (a  “Permitted
Reorganization”) so long as:


 


(a) the successor formed by such
consolidation or amalgamation or the survivor of such merger or the Person that
acquires by conveyance, transfer or lease all or substantially all of the
properties of the Company or such Guarantor as an entirety, as the case may be
(the “Successor
Corporation”), shall be a solvent
corporation organized and existing under the laws of an Acceptable State;


 


(b) if the Company or such Guarantor is not
the Successor Corporation, as the case may be, then the Successor Corporation
shall have executed and


 


80

















 


delivered to each holder of Notes its
assumption of the due and punctual performance and observance of each covenant
and condition of the Company contained in this Agreement and the Notes, or, in
the case of a Guarantor, contained in the applicable Subsidiary Guarantee (in
each case pursuant to such agreements and instruments as shall be reasonably
satisfactory to the Required Holders), and the Company or such Guarantor, as
the case may be, shall have caused to be delivered to each holder of Notes:


 


(i)                                  an
opinion of internationally recognized independent counsel, or other independent
counsel reasonably satisfactory to the Required Holders, to the effect that all
agreements or instruments effecting such assumption are enforceable in
accordance with their terms and comply with the terms hereof; and


 


(ii)                              an
opinion of independent counsel in the jurisdiction of organization of such
Successor Corporation reasonably satisfactory in form and substance to the
Required Holders to the effect that (1) the Successor Corporation is duly and
validly organized and existing under the laws of such jurisdiction of
organization, (2) the Successor Corporation shall have duly authorized,
executed and delivered such agreements effecting such assumption, and such
agreements are, subject to the legality and enforceability thereof under New
York law, legally binding and enforceable in accordance with their terms under
the laws of such jurisdiction, (3) such assumption does not conflict with the
laws of such jurisdiction, and (4) the obligations of such Successor
Corporation rank at least pari passu with all of such Successor Corporation’s
other obligations in respect of its senior, unsecured and unsubordinated
Financial Indebtedness (except for such obligations as shall be mandatorily preferred
by law and not by reason of contract);


 


(c) immediately after giving effect to such
transaction, no Default or Event of Default shall have occurred and be
continuing; and


 


81

















 


(d) in the case of any such transaction
involving the Company, the Company shall have complied with the provisions of
Section 8.8 to the extent such Section is applicable in connection with such
transaction.


 


Notwithstanding the foregoing, no such
conveyance, transfer or lease of all or substantially all of the properties of
the Company or any Guarantor shall have the effect of releasing the Company,
any Guarantor or any Successor Corporation that shall theretofore have become
such in the manner prescribed in this Section 10.2 from its liability under
this Agreement or the Notes or its respective Subsidiary Guarantee, as the case
may be.


 


10.3.                     Liens, etc.


 


The Company will not, and will not permit any
of its Subsidiaries to, directly or indirectly create, incur, assume or permit
to exist (upon the happening of a contingency or otherwise) any Lien on or with
respect to any property or asset (including, without limitation, any document
or instrument in respect of goods or accounts receivable) of the Company or any
such Subsidiary (and in no event shall any amounts outstanding under the Bank
Facility, any Committed Medium-Term Financing or any Committed External
Financing be secured by any Liens) whether now owned or hereafter acquired, or
any income or profits therefrom or assign or otherwise convey any right to
receive income or profits unless it makes, or causes to be made, effective
provision whereby the Notes will be equally and ratably secured with any and
all other obligations thereby secured, (x) such security to be granted (i) no
later than the date upon which the Lien is granted, and (ii) pursuant to an
agreement reasonably satisfactory to the Required Holders and (y) if such
obligations are the Bank Facility, any Committed Medium-Term Financing or any
Committed External Financing, the holders of such obligations shall have
entered into an intercreditor agreement with the Noteholders satisfactory in
form, scope and substance to each Noteholder in its sole discretion and, in any
case, the Notes shall have the benefit to the fullest extent that, and with
such priority as, the holders of the Notes may be entitled under applicable
law, of an equitable Lien on such property, except:


 


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(a) Liens existing as of December 31, 2002 and
described in Schedule 5.13;


 


(b) Liens for taxes or assessments or other
applicable governmental charges or levies not yet delinquent or which are being
contested as permitted by Section 9.4;


 


(c) Liens created or arising by operation of
law in the ordinary course of business, including, without limitation,
landlords’ liens and statutory liens of carriers, warehousemen, mechanics,
materialmen, vendors and other Liens securing amounts which are not yet due or
which are being contested on a timely basis in good faith by appropriate means
(so long as the enforcement of any such Lien shall be stayed during such
contest) and for which appropriate reserves or similar provision have been made
under Applicable GAAP;


 


(d) Liens incurred or deposits made in the ordinary
course of business in connection with workers’ compensation, unemployment
insurance and other types of social security or to secure the performance of
tenders, statutory obligations, surety or appeal bonds, bids, leases,
government contracts, performances in return of money bonds and similar
obligations;


 


(e) easements, rights-of-way, zoning and
similar restrictions and other similar Liens not materially impairing the value
of the property to which such restrictions or other similar Liens attach or interfering
with the ordinary conduct of the business of the Company and its Subsidiaries;


 


(f) any attachment or judgment Lien unless
the judgment it secures shall not, within 60 days after the entry thereof, have
been discharged or execution thereof stayed pending appeal, or shall not have
been discharged within 60 days after the expiration of any such stay;


 


(g) Liens in favor of banks or other
depository institutions arising in the ordinary course of business from
statutory rights of set-off;


 


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(h) Liens encumbering goods and documents of
title with respect to such goods and arising in the ordinary course of business
in connection with the issue of documentary letters of credit, in each case not
incurred or made in connection with the borrowing of money or the obtaining of
advances or similar credit, and Liens arising out of title retention provisions
in a supplier’s standard condition of supply of goods acquired in the ordinary
course of business (so long as the obligations that are material and are owing
to such supplier are not overdue);


 


(i) Liens in respect of property of any
Subsidiary in favor of the Company or another Wholly-Owned Subsidiary;


 


(j) in the case of any Person that after the
date hereof is acquired by or consolidated with or merged with or into the
Company or any Subsidiary, Liens existing at the time such Person is so
acquired, consolidated or merged (and not incurred in anticipation thereof), or
in the case of any property or assets acquired by the Company or any Subsidiary
after the date hereof, Liens existing on such property or assets at the time of
acquisition thereof (and not incurred in anticipation thereof), whether or not
the Financial Indebtedness secured thereby is assumed by the Company or such
Subsidiary, provided that:


 


(i)                                  no
such Lien shall extend to or cover any other property of the Company or such
Subsidiary, as the case may be; and


 


(ii)                              the
Company shall cause such Lien to be discharged within 180 days after the effective
date of such acquisition, consolidation or merger;


 


(k) Liens in respect of property or assets
(including real property) acquired or developed by the Company or any
Subsidiary after the date hereof, which Liens are created at the time of
acquisition or on or before completion of development of such property or
assets, to secure Financial Indebtedness assumed or incurred to finance all or
any part of the purchase


 


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price or cost of developing such property or
assets, provided that:


 


(i)                                  no
such Lien shall extend to or cover any other property or assets of the Company
or such Subsidiary, as the case may be; and


 


(ii)                              the
principal amount of the Financial Indebtedness secured by all such Liens in
respect of any such property or assets shall not exceed the lesser of the Fair
Market Value (determined at the time of acquisition or development) or the cost
of such property or assets;


 


(l) extensions, renewals or replacements of
any Lien permitted by clause (a) or (k) of this Section 10.3 in connection with
extensions, renewals or refundings of the Financial Indebtedness secured
thereby (including the undrawn portion of facilities set forth in Schedule
5.13) so long as the principal amount of such Financial Indebtedness or
facility is not increased and such Lien as so extended, renewed or replaced
does not extend to or cover any property other than the property covered
thereby immediately prior to such extension, renewal or replacement; and


 


(m) other Liens to the extent not otherwise
permitted by clauses (a) through (l) of this Section 10.3, inclusive, provided
that the sum of (i) the aggregate amount of the Financial Indebtedness and
other obligations of the Group secured by Liens other than Liens listed on Schedule
5.13 except to the extent the principal amount secured by such Lien exceeds the
amount stated in such Schedule, plus (without duplication) (ii) Total
Subsidiary Debt at such time, does not exceed £30,000,000 (or its equivalent in
other currencies) at such time.


 


Notwithstanding the foregoing provisions of
this Section 10.3, the Company shall not, and shall procure that no member of
the Group shall, create or allow to exist any Lien on any of its assets in
favor of a Person securing Financial Indebtedness where the principal amount or
the committed amount of the Financial Indebtedness secured is £50,000,000 or
more and that Financial Indebtedness has a scheduled final maturity date
falling on or after March 31,


 


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2006 except any Liens in respect of this Agreement or the Notes to the
extent such Liens are otherwise expressly permitted under this Agreement.  If any member of the Group intends to
create, creates or permits to subsist any Lien on any of its assets in
violation of the preceding sentence, the Company shall ensure, by no later than
the date on which such Lien is granted, that (x) the relevant member of the
Group executes such security and intercreditor documentation as the Required
Holders may require to ensure that all the obligations under the Financing
Documents shall be secured by the same assets and shall rank pari passu with
the other obligations secured on those assets, or (y) at the request of the
Company, such other security and intercreditor documentation in respect of any
other assets of the Group as the Required Holders shall agree, provided that in
the case of both (x) and (y) such violation shall nevertheless constitute an
Event of Default.


 


10.4.                   Sale of Assets, etc.


 


(a) The Company will not, and will not permit
any Subsidiary to, sell, convey, transfer or dispose of to a third party the
Networks Product Division and/or the Systems-Drive Division.


 


(b) Prior to the Normalization Date, the
Company will not, and will not permit any Subsidiary to, make any Transfer
without the prior written consent of the Required Holders except for Permitted
Disposals and Asset Dispositions permitted under Section 10.2.


 


(c) On and after the Normalization Date,
except as permitted under Section 10.2 of this Agreement, the Company will not,
and will not permit any Subsidiary to, make an Asset Disposition unless:


 


(i)                                  in
the good faith opinion of the Company, the Asset Disposition is in the best
interest of the Company or such Subsidiary;


 


(ii)                              immediately
after giving effect to the Asset Disposition, no Default or Event of Default
would exist; and


 


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(iii)                          immediately
after giving effect to the Asset Disposition, the Net Proceeds Amount arising
from all Asset Dispositions of all property that was the subject of any Asset
Disposition occurring on and after the Effective Date would not exceed
£25,000,000.


 


If the Net Proceeds Amount received in
respect of any Transfer is applied to a Debt Prepayment Application or a
Property Reinvestment Application within 365 days after such Transfer, then
such Net Proceeds Amount shall be excluded for the purpose of determining
compliance with clause (c) of this Section 10.4 as of any date.


 


10.5.                   Consolidated Net Worth.


 


The Company will not, at any time, permit
Consolidated Net Worth to be less than £100,000,000.


 


10.6.                   Consolidated Net Debt; Interest Coverage.


 


(A)                            Consolidated
Net Debt; Interest Coverage prior to the Normalization Date.


 


(a)
Consolidated Net Debt prior to the Normalization Date. Prior to the
Normalization Date, the Company will not permit, as at any Testing Date, the
ratio of Consolidated Net Debt as at such Testing Date to Consolidated EBITDA
for the Accounting Period ending on such Testing Date to exceed:


 


(i)                                  for
the Testing Date on March 31, 2003, 3.0 to 1.0;


 


(ii)                              for
the Testing Date on June 30, 2003, 2.75 to 1.0;


 


(iii)                          for the
Testing Date on September 30, 2003, 2.5 to 1.0;


 


(iv)                            for
the Testing Date on December 31, 2003, 2.25 to 1.0; and


 


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(v)                                for
the Testing Date on March 31, 2004 and each Testing Date thereafter, 2.25 to
1.0.


 


(b)                               Interest Coverage prior to the Normalization Date.  Prior to the Normalization Date, the Company
will not permit, as at any Testing Date, the ratio of Consolidated EBITA to
Consolidated Net Interest Expense, in each case determined for the Accounting
Period ending on such Testing Date, to be less than:


 


(i)                                  for
the Testing Date on March 31, 2003, 2.0 to 1.0;


 


(ii)                              for the
Testing Date on June 30, 2003, 2.0 to 1.0;


 


(iii)                          for the
Testing Date on September 30, 2003, 2.25 to 1.0;


 


(iv)                            for
the Testing Date on December 31, 2003, 2.5 to 1.0 and


 


(v)                                for
the Testing Date on March 31, 2004 and each Testing Date thereafter, 2.5 to
1.0.


 


(B)                              Consolidated
Net Debt; Interest Coverage on and after the Normalization Date.


 


(a)
Consolidated Net Debt on and after the Normalization Date.  On and after the Normalization Date, the
Company will not permit, as at any Testing Date, the ratio of Consolidated Net
Debt as at such Testing Date to Consolidated EBITDA for the Accounting Period
ending on such Testing Date to exceed for each Testing Date, 3.0 to 1.0.


 


(b)
Interest Coverage on and after the Normalization Date.  On and after the Normalization Date, the
Company will not permit, as at any Testing Date, the ratio of Consolidated
EBITA to Consolidated Net Interest Expense, in each case determined for the
Accounting Period ending on such Testing Date, to be less than 3.0 to 1.0.


 


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1.13.                   Subsidiary Debt; Subsidiary Guarantees.


 


(c) Total
Subsidiary Debt.  The Company
will not at any time permit the sum of (i) Total Subsidiary Debt at such time,
plus (without duplication) (ii) the aggregate amount of Financial Indebtedness
and other obligations of the Group secured by Liens other than Liens listed on
Schedule 5.13 except to the extent the principal amount secured by such Lien
exceeds the amount stated in such Schedule at such time, to exceed £30,000,000
(or its equivalent in other currencies).


 


(b) Guarantors.  The Company may at any time cause any
Subsidiary (whether in existence on the date hereof or otherwise) to become a
‘Subsidiary Guarantor’ for all purposes of this Agreement by:


 


(i)                                  causing
such Subsidiary to execute and deliver, to each holder, a Subsidiary Guarantee
substantially in the form of Exhibit 4.5 (with such modifications as may be
necessary to reflect the Restructuring Transaction and any changes required by
local counsel (other than any limitation that is not immaterial on such
Subsidiary’s obligations under such Subsidiary Guarantee regardless of whether
such limitation is required by applicable law or otherwise)); and


 


(ii)                              delivering,
to each holder, the following:


 


(A)                              a written
notice, signed by Senior Officers of the Company, making reference to this
Section 10.7 (b), stating that such Subsidiary shall become obligated in
respect of a Subsidiary Guarantee, and specifying the jurisdiction of
incorporation of such Subsidiary and the percentage of its Voting Shares and
other equity interests owned by the Company and the other Subsidiaries;


 


(B)                              an
Officer’s Certificate from the Company confirming that the representations and
warranties of such


 


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Subsidiary Guarantor contained in such
Subsidiary Guarantee are true and correct;


 


(C)                             copies
of the articles of association or certificate or articles of incorporation, and
all other constitutive documents, of such Subsidiary, and resolutions of the
board of directors of such Subsidiary authorizing its execution and delivery of
the Subsidiary Guarantee and the transactions contemplated thereby (in each
case, certified as correct and complete copies by the secretary or an assistant
secretary (or an equivalent officer) of such Subsidiary); and


 


(D)                             a
legal opinion, satisfactory in form, scope and substance to the Required
Holders, of independent counsel to the effect that (1) such Subsidiary is duly
and validly organized and existing under the laws of its jurisdiction of
organization and (if applicable in such jurisdiction) is in good standing, (2)
such Subsidiary Guarantee shall have been duly authorized, executed and
delivered by such Subsidiary and is within the corporate objects or purposes of
such Subsidiary, (3) such Subsidiary Guarantee is enforceable in accordance
with its terms and not subject to any limitation as to amount or scope under
applicable law, and (4) the obligations of such Subsidiary under such
Subsidiary Guarantee rank at least pari passu with all of such Subsidiary’s
other unsecured Financial Indebtedness (except for such obligations as shall be
mandatorily preferred by law and not by reason of contract).


 


(c) No
Release of Subsidiary Guarantees. No subsidiary Guarantee shall be
released at any time without the prior written consent of each of the
Noteholders unless such Guarantor is disposed of in accordance with Section
10.1, Section 10.2 and Section 10.4 of this Agreement.


 


(d) Required
Additional Subsidiary Guarantees. 
The Company


 


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will not permit any Subsidiary (other than a
Subsidiary that is a Guarantor) to enter into, incur, grant or be or become
liable under or otherwise permit to exist any Guaranty in respect of any
Financial Indebtedness (other than the Financial Indebtedness evidenced by the
Notes and derivative transactions on standard ISDA terms), unless a Subsidiary
Guarantee has been granted by such Subsidiary in favor of the holders of the
Notes in respect of the obligations of the Company under and pursuant to this
Agreement and the Notes and such Subsidiary has otherwise complied with the
provisions of clause (b) of this Section 10.7.


 


(e) Pari
Passu Ranking.  Each
Subsidiary Guarantee will at all times rank at least pari passu, without
preference or priority, with any Guaranty granted by the Company or any
Subsidiary in respect of the Bank Facility, any Committed Medium-Term Financing
or any Committed External Financing.


 


10.8.                     No Restrictive Agreements.


 


The Company will not permit any Subsidiary
(other than a Guarantor) to become or remain a party to any agreement or
arrangement that prohibits or would prohibit or restrict such Subsidiary from
paying dividends or other distributions on its capital stock or other equity
interests or otherwise making advances to the Company or any other Subsidiary
if such agreement or arrangement would have a Material Adverse Effect.


 


10.9.                     Business of the Company and its
Subsidiaries.


 


The Company shall procure that, except as
disclosed to the Noteholders prior to the date hereof and in the Information
Pack (as referred to in Section 5.3), no substantial change is made to the
nature of the Group’s business from that carried on at the date of disclosure.


 


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10.10.              Distributions.


 


(a) Distributions
prior to the Normalization Date. Prior to the Normalization Date,
the Company will not, and will not permit any Guarantor (except for the
Guarantors listed on Schedule 10.10 which are not Wholly-Owned Subsidiaries) to
declare (including, without limitation, by way of set-off, combination of
accounts or otherwise), make, pay or permit to accrue any Distribution (whether
in cash or in specie), provided that the Company or any Guarantor may declare
or permit to accrue a Distribution to the Company or another Guarantor, as the
case may be.


 


(b) Distributions
on and after the Normalization Date.  On and after the Normalization Date, the Company (i) may declare,
make, pay or permit to accrue a Distribution only if such Distribution is
directly derived from Net Distributable Earnings of the Company which accrued
after January 1, 2003, and (ii) will not permit any Guarantor (except for the
Guarantors listed on Schedule 10.10 
which are not Wholly-Owned Subsidiaries) to declare (including, without
limitation, by way of set-off, combination of accounts or otherwise) make, pay
or permit to accrue any Distribution (whether in cash or in specie), provided
that any Guarantor may declare or permit to accrue a Distribution to the
Company or another Guarantor, as the case may be.


 


10.11.              Acquisitions.


 


(a) Acquisitions
prior to the Normalization Date. Prior to the Normalization Date,
the Company will not, and will not permit any of its Subsidiaries to, acquire
or make any investment in any companies, joint ventures or partnerships or
other Persons or acquire any businesses (or interests therein) or incorporate
any company (or commit to do any of the same (whether conditionally or
otherwise)) (an “Acquisition”) whether for cash, shares or other consideration
without the prior written consent of the Required Holders except:


 


(i)                                  Acquisitions
of assets purchased in the ordinary course of


 


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trade in connection with the Group’s current
businesses;


 


(ii)                              Permitted
Reorganizations;


 


(iii)                          The
payment of the existing deferred consideration obligations in respect of
Acquisitions completed prior to the Effective Date as set out on Schedule
10.11, which obligations shall be satisfied by the Company in Company shares to
the extent contemplated or expressly permitted by the agreements giving rise to
such obligations and which obligations the Company shall not modify or amend in
a manner that increases the amount payable by any member of the Group
thereunder or is otherwise less favorable to the Group except as further
described on Schedule 10.11; and


 


(iv) Acquisitions with an aggregate
consideration of up to £2,500,000 in any financial year.


 


(b) Acquisitions
on and after the Normalization Date. On and after the Normalization
Date, the Company will not, and will not permit any of its Subsidiaries to,
make an Acquisition or commit to make an Acquisition whether for cash, shares
or other consideration unless the group finance director of the Company
certifies to the holders of the Notes that such Acquisition would not on a pro
forma basis have resulted in the Company breaching any of the financial
covenants set out in this Agreement (and as in effect on and after the
Normalization Date) on either of (i) the two Testing Dates immediately prior to
and (ii) the two Testing Dates (based on the Company’s projections) immediately
after the proposed date of the Acquisition. 
For the purpose of calculating pro forma financial information for
purposes of this Section 10.11(b) for a period ending on a Testing Date, it
shall be assumed that the Acquisition shall have occurred on the first day of
the Accounting Period (which for the avoidance of doubt shall be a twelve month
period) ending on the applicable Testing Date.


 


Notwithstanding the foregoing, the Company
will not, and will not permit


 


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any of its Subsidiaries to, make any Acquisition (except pursuant to
clause (a)(i) or clause (a)(iii) above) during the continuance of an Event of
Default under this Agreement whether before or after the Normalization Date.


 


10.12.     Maintenance of Most Favored Lender
Status.


 


Neither the Company nor any Guarantor will
(i) enter into any modification or amendment to any existing credit facility or
other financing document for Financial Indebtedness (including, without
limitation, the Bank Facility) other than any modification or amendment to any
existing derivative transaction on standard ISDA terms, or (ii) enter into any
new credit facility or financing document for Financial Indebtedness
(including, without limitation, any Committed Medium-Term Financing or
Committed External Financing) other than derivative transactions on standard
ISDA terms, that contains financial or other business covenants, definitions or
testing requirements relating thereto, guarantees, preferences,
representations, warranties, financial reporting requirements, defaults or
events of default (howsoever described) provisions more favorable to the lender
or financier thereunder than those applicable to the Notes (the “Additional Provisions”) unless the Company or the Guarantor, as applicable,
shall execute and deliver to the holders of the Notes an instrument in writing
supplementing the Financing Documents and extending the benefit of such
Additional Provisions to the holders of the Notes. Once incorporated in the
Financing Documents, no waiver or consent under or amendment or termination of
the credit facility or other financing document for Financial Indebtedness
containing the Additional Provisions shall have any effect on the Additional
Provisions as incorporated in the Financing Documents.


 


11.                               EVENTS OF DEFAULT.


 


An “Event of Default” shall exist if any of the following conditions or events shall occur
and be continuing:


 


(a) the Company defaults in the payment of
any principal or Make-Whole Amount or Modified Make-Whole Amount, if any, on
any Note when


 


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the same becomes due and payable, whether at
maturity or at a date fixed for prepayment or by declaration or otherwise,
provided that in the event of a failure to make any such payment caused by a
technical or administrative error by a Person (other than the Company, any
Subsidiary or any Affiliate) or systems failure, an Event of Default shall not
be deemed to have occurred under this Section 11(a) until the date that is
three Business Days after the date such payment is otherwise due; or


 


(b) the Company defaults in the payment of
any interest on any Note or any Additional Payments for more than five Business
Days after the same becomes due and payable; or


 


(c) (i) the Company defaults in the
performance of or compliance with any term contained in any
of Section 7.1(A)(f), Section 7.1(B)(e), Section 10.4, Section 10.5,
Section 10.6, Section 10.7(a), Section 10.10, Section 10.11, or (ii) the
Company defaults in the performance of or compliance with any term contained in
Section 10.2, Section 10.3 or Section 10.7(b), Section 10.7(c), Section
10.7(d) or Section 10.7(e) and any such default described in this sub-clause
(ii) is not remedied within 10 Business Days after the earlier of (A) a Senior
Financial Officer of the Company obtaining any knowledge of such default and
(B) the Company receiving written notice of such default from any holder of a
Note (any such written notice to be identified as a “notice of default” and to
refer specifically to this sub-clause (ii) of clause (c)); or


 


(d) the Company defaults in the performance
of or compliance with any term contained herein or in any other Financing
Document (other than those referred to in clause (a), clause (b) and clause (c)
of this Section 11) and such default is not remedied within 20 days after the
earlier of (i) a Senior Financial Officer of the Company obtaining any
knowledge of such default and (ii) the Company receiving written notice of such
default from any holder of a Note (any such written notice to be identified as
a “notice of default” and to refer specifically to this clause (d)); or


 


95

















 


(e) any representation or warranty made by
the Company or any Guarantor in any Financing Document to which it is a party
or in any Officer’s Certificate or in any certificate or other writing
certified by Senior Officers and furnished as required by a specific provision
hereof or thereof proves to have been false, misleading or incorrect in any
material respect on the date as of which made; or


 


(f) (i) the Company or any Subsidiary is in
default (as principal or as guarantor or other surety) in the payment when due
(whether by lapse of time, by declaration, by call for redemption or otherwise)
of any principal of or premium or make-whole amount or interest on any Financial
Indebtedness beyond any period of grace originally provided with respect
thereto that individually or together with such other Financial Indebtedness as
to which any such failure exists has an aggregate outstanding principal amount
of at least US$15,000,000 or £10,000,000 (whichever amount shall be the
lesser), or (ii) there is any outstanding “event of default” under the Bank
Facility Agreement, any Committed Medium-Term Financing, any Committed External
Financing or any document relating to the Financial Indebtedness of a member of
the Group (howsoever that term or its equivalent may be defined therein), or
(iii) the Company or any Subsidiary is in default in the performance of or
compliance with any term of any evidence of any Financial Indebtedness that
individually or together with such other Financial Indebtedness as to which any
such failure exists has an aggregate outstanding principal amount of at least
US$15,000,000 or £10,000,000 (whichever amount shall be the lesser) or of any
mortgage, indenture or other agreement relating thereto or any other condition
exists, and as a consequence of such default or condition such Financial
Indebtedness has become, or has been declared (or one or more Persons are
entitled to declare such Financial Indebtedness to be), due and payable before
its stated maturity or before its regularly scheduled dates of payment, or (iv)
as a consequence of the occurrence or continuation of any event or condition
(other than the passage of time or the right of the holder of Financial
Indebtedness to convert such Financial Indebtedness into equity interests), (x)
the Company or any Subsidiary has


 


96

















 


become obligated to purchase or repay
Financial Indebtedness before its regular maturity or before its regularly
scheduled dates of payment in an aggregate outstanding principal amount of at
least US$15,000,000  or £10,000,000
(whichever amount shall be the lesser), (y) one or more Persons have the right
to require the Company or any Subsidiary so to purchase or repay such Financial
Indebtedness, or (z) any commitment for, or the underwriting of, any Financial
Indebtedness, the aggregate amount of such Financial Indebtedness being at
least US$15,000,000  or £10,000,000
(whichever amount shall be the lesser) of a member of the Group is cancelled or
suspended as a result of an event of default (howsoever described) under the
document relating to that Financial Indebtedness, or (v) any Lien securing
Financial Indebtedness over any asset of a member of the Group becomes
enforceable; or


 


(g) the Company or any Material Subsidiary
(i) ceases or threatens in writing to cease, or suspends or threatens in
writing to suspend, making payments in respect of all or any class of its debts
and other obligations or ceases carrying on all or substantially all of its
business, (ii) is generally not paying, or is deemed for the purpose of any law
to be unable to pay, or admits in writing its inability to pay, its debts as
they become due, (iii) files, or takes any step, including a proposal or
convening a meeting, or consents by answer or otherwise to the filing against
it of, a petition for relief or reorganization or arrangement or any other
petition in bankruptcy, for liquidation or to take advantage of any bankruptcy,
insolvency, reorganization, readjustment of debt, dissolution, liquidation,
administration, moratorium, composition, assignment, arrangement with any of
its creditors, or other similar law of any jurisdiction, or commences a
voluntary winding-up or dissolution or applies to a court for an administration
order under the Insolvency Act or any similar statute, (iv) makes an assignment
for the benefit of its creditors or proposes or enters into any negotiations
with one or more of its creditors with a view to the readjustment or
rescheduling of all or any class of its indebtedness by reason of financial
difficulties, or proposes or enters into any composition, scheme of arrangement
or other arrangement for the benefit of its creditors


 


97

















 


generally or any class of creditors, (v)
consents to the appointment of a custodian, receiver, administrative receiver,
administrator, supervisor, liquidator, trustee or other officer with similar
powers with respect to it or with respect to any substantial part of its
property, (vi) is adjudicated as bankrupt or insolvent or to be liquidated, or
(vii) takes corporate action for the purpose of any of the foregoing including,
without limitation, convening a meeting of the shareholders, directors or other
officers of the Company or a Material Subsidiary for the purpose of considering
any resolution for, to petition for, or to file documents with a court for its
winding-up or its administration or any such resolution is passed; or


 


(h) a court or governmental authority of
competent jurisdiction enters an order appointing, without consent by the
Company or any Material Subsidiary, a custodian, receiver, administrative
receiver, administrator, supervisor, liquidator, trustee, compulsory manager or
other officer with similar powers with respect to it or with respect to any
part of its property (or any such Person is appointed, in a manner permitted by
applicable law and, if applicable, contract, by one or more creditors of the Company
or any Material Subsidiary), or constituting an order for relief or approving a
petition for relief or reorganization, or approving or imposing any suspension
or moratorium of payments, or approving any other petition in bankruptcy or for
liquidation or to take advantage of any bankruptcy, insolvency, reorganization,
arrangement, readjustment of debt, dissolution, liquidation or other similar
law of any jurisdiction, or ordering the dissolution, winding-up or liquidation
of the Company or any of the Material Subsidiaries, or any such petition shall
be filed against the Company or any of the Material Subsidiaries and such
petition shall not be withdrawn or discharged within 30 days; the directors,
shareholders or other officers of the Company or any Material Subsidiary
request the appointment of a liquidator, trustee in bankruptcy, judicial
custodian, compulsory manager, receiver, or give notice of their intention to
appoint an administrative receiver, administrator, or the like; or any other
step (including a petition, proposal or convening a meeting) is taken with a
view to the rehabilitation, administration, custodianship, liquidation,
winding-up


 


98

















 


or dissolution of or any other insolvency
proceedings involving the Company or any Material Subsidiary, and, in the case
of any such step taken by a creditor, it is not withdrawn or discharged or
stayed within 30 days; or any of the property of the Company or any of the
Material Subsidiaries having an aggregate value of £1,000,000 (or its
equivalent in other currencies) is sequestered by court order or affected by
any attachment, distress or execution order and such order remains in effect
for 30 days or more; or any other step is taken to enforce security over any
part of the assets of the Company or any Material Subsidiary and is not
withdrawn, discharged or stayed within 30 days; or


 


(i) a final judgment or judgments for the
payment of money aggregating in excess of US$15,000,000 (or its equivalent in
other currencies) are rendered against one or more of the Company and the
Material Subsidiaries and which judgments are not, within 60 days after entry
thereof, bonded, discharged or stayed pending appeal, or are not discharged
within 60 days after the expiration of such stay; or


 


(j) if (i) any US Plan shall fail to satisfy
the minimum funding standards of ERISA or the US Tax Code for any plan year or
part thereof or a waiver of such standards or extension of any amortization
period is sought or granted under Section 412 of the US Tax Code, (ii) a notice
of intent to terminate any US Plan shall have been or is reasonably expected to
be filed with the PBGC or the PBGC shall have instituted proceedings under
Section 4042 of ERISA to terminate or appoint a trustee to administer any US
Plan or the PBGC shall have notified the Company or any ERISA Affiliate that a
US Plan may become a subject of any such proceedings, (iii) the aggregate
“amount of unfunded benefit liabilities” (within the meaning of Section
4001(a)(18) of ERISA) under all US Plans, determined in accordance with Title
IV of ERISA, shall exceed US$15,000,000, (iv) the Company or any ERISA
Affiliate shall have incurred or is reasonably expected to incur any liability
pursuant to Title I or IV of ERISA or the penalty or excise tax provisions
of the US Tax Code relating to employee benefit plans, (v) the Company or any
ERISA Affiliate


 


99

















 


withdraws from any US Multiemployer Plan,
(vi) the Company or any Subsidiary establishes or amends any employee welfare
benefit plan that provides post-employment welfare benefits in a manner that
would increase the liability of the Company or any Subsidiary thereunder, (vii)
the Company or any Subsidiary fails to make any required premium, contribution
or other payment in respect of any Non-US Pension Plan in excess of
US$15,000,000 (or its equivalent in other currencies) or (viii) the Company or
any Subsidiary shall fail to operate, administer or maintain any Non-US Pension
Plan in compliance with all laws, regulations and orders applicable thereto;
and any such event or events described in sub-clauses (i) through (viii) above,
either individually or together with any other such event or events, could
reasonably be expected to have a Material Adverse Effect (as used in this
Section 11(j), the term “employee welfare benefit plan”
shall have the meaning assigned to such term in Section 3 of ERISA); or


 


(k) (i) any Guarantee shall cease to be in
full force and effect or shall be declared by a court or other Governmental
Authority of competent jurisdiction to be void, voidable or unenforceable
against any Guarantor, (ii) the validity or enforceability of any Guarantee
against any Guarantor shall be contested by such Guarantor, or (iii) the
Company, any Guarantor or any Affiliate shall deny that any Guarantor has any
further liability or obligation under any Guarantee; or


 


(l) prior to the Normalization Date, in the
event of a refusal by the Banks under the Bank Facility or the relevant banks
or financial institutions under any Committed External Financing to fund any
advance requested by the Company or any other borrower thereunder or the total
commitments under the Bank Facility or any Committed External Financing are
withdrawn prior to the “Final Maturity Date” as defined under the Bank Facility
or the stated maturity date under any Committed External Financing, as
applicable, in circumstances where (i) (A) such Bank under the Bank Facility or
such bank or financial institution under any Committed External Financing
asserts that an “event of default”


 


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(howsoever defined in the applicable
agreements) pursuant only to a “material adverse change” (howsoever defined in
the applicable agreements) has occurred, or will potentially occur, (B) the
request for the advance is not subsequently withdrawn, and (C) the refusal by
the Bank under the Bank Facility or the financial institution under any
Committed External Financing to fund the advance continues for five Business
days, or (ii) the Company is put on notice, whether in writing or orally, by
the agent bank under the Bank Facility or the agent bank under any Committed
External Financing that a request by the Company or any other borrower
thereunder to fund an advance would not be granted or should not be made; or


 


(m)      (i) any case shall be
instituted by or against any Material Subsidiary incorporated in the United
States under the US Bankruptcy Code of 1978 or any other United States federal
or state bankruptcy, insolvency or similar law for the release of debtors and,
in the case of any such case instituted against it (but not instituted by it),
either: (A) the case shall remain undismissed or unstayed for a period of 60
days; or (B) any of the actions sought in the case (including, without
limitation, the entry of an order for relief against, or the appointment of a
receiver, trustee, custodian or other similar official for it, or any
substantial part of its assets) shall occur; or (ii) any Material Subsidiary
incorporated in the United States shall take any corporate actions to authorize
any of the actions set out in clause (i) above; or (iii) any Material
Subsidiary incorporated in the United States is unable to pay its debts
generally as they fall due or shall admit in writing its inability to pay its
debts generally, or shall make a general assignment for the benefit of its
creditors; or


 


(n) there occurs in relation to the Company or a Material Subsidiary,
any event anywhere which, in the opinion of the Required Holders, appears to
correspond with any of those mentioned in clauses (g), (h) or (m) above; or


 


(o) it is or becomes unlawful for the Company to perform any of its
obligations under the Financing Documents; or


 


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(p) the Company or
any Material Subsidiary ceases to carry on business unless the business is
transferred to any other member of the Group; or


 


(q) any event or
series of events occurs which, in the reasonable opinion of the Required
Holders, has or is reasonably likely to have a Material Adverse Effect.


 


12.          REMEDIES ON DEFAULT, ETC.


 


12.1.       Acceleration.


 


(a) If an Event of
Default with respect to the Company or any Guarantor described in clause (g),
clause (h) or clause (m) of Section 11 (other than an Event of Default
described in sub-clause (ii) of clause (g) or described in sub-clause (vii) of
clause (g) by virtue of the fact that such clause encompasses sub-clause (ii)
of clause (g)) has occurred, all the Notes then outstanding shall automatically
become immediately due and payable.


 


(b) If any other
Event of Default has occurred and is continuing, any holder or holders of at
least 51% in principal amount of Notes at the time outstanding may at any time
at its or their option, by notice or notices to the Company, declare all the
Notes then outstanding to be immediately due and payable.


 


(c) If any Event of
Default described in clause (a) or clause (b) of Section 11 has occurred and is
continuing, any holder or holders of Notes at the time outstanding affected by
such Event of Default may at any time, at its or their option, by notice or
notices to the Company, declare all the Notes held by it or them to be
immediately due and payable.


 


Upon any Notes becoming due and payable under
this Section 12.1, whether automatically or by declaration, such Notes will
forthwith mature and the entire unpaid principal amount of such Notes, plus (x)
all accrued and unpaid


 


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interest thereon and (y) the Make-Whole
Amount determined in respect of such principal amount (to the full extent
permitted by applicable law), shall all be immediately due and payable, in each
and every case without presentment, demand, protest or further notice, all of
which are hereby waived.  The Company
acknowledges, and the parties hereto agree, that each holder of a Note has the
right to maintain its investment in the Notes free from repayment by the
Company (except as herein specifically provided for) and that the provision for
payment of a Make-Whole Amount by the Company, in the event that the Notes are
prepaid or are accelerated as a result of an Event of Default, is intended to
provide compensation for the deprivation of such right under such circumstances.


 


12.2.    Other Remedies.


 


If any Default or Event of Default has
occurred and is continuing, and irrespective of whether any Notes have become
or have been declared immediately due and payable under Section 12.1, the
holder of any Note at the time outstanding may proceed to protect and enforce
the rights of such holder by an action at law, suit in equity or other
appropriate proceeding, whether for the specific performance of any agreement
contained herein or in any Note, or for an injunction against a violation of
any of the terms hereof or thereof, or in aid of the exercise of any power
granted hereby or thereby or by law or otherwise.


 


12.3.    Rescission.


 


At any time after any Notes have been
declared due and payable:


 


(a) pursuant to, and as provided in, clause
(b) of Section 12.1, any holder or holders of more than 50% in principal amount
of the Notes at the time outstanding may; or


 


(b) pursuant to, and as provided in, clause
(c) of Section 12.1, the holder or holders of such Notes that have declared
such Notes to be due and payable because of an Event of Default described in
clause (a) or clause (b) of Section 11 may,


 


103

















 


by written notice to the Company, rescind and
annul any such declaration and its consequences if (i) the Company has paid all
overdue interest on the Notes, all principal of and Make-Whole Amount or
Modified Make-Whole Amount, if any, on any Notes that are due and payable and
are unpaid other than by reason of such declaration, and all interest on such
overdue principal and Make-Whole Amount or Modified Make-Whole Amount, if any,
and (to the extent permitted by applicable law) any overdue interest in respect
of any Series of the Notes, at the Default Rate for such Series, (ii) all Events
of Default and Defaults, other than non-payment of amounts that have become due
solely by reason of such declaration, have been cured or have been waived
pursuant to Section 17, and (iii) no judgment or decree has been entered for
the payment of any monies due pursuant hereto or to the Notes. No rescission
and annulment under this Section 12.3 will extend to or affect any subsequent
Event of Default or Default or impair any right consequent thereon.


 


12.4.    No Waivers or Election of Remedies,
Expenses, etc.


 


No course of dealing and no delay on the part
of any holder of any Note in exercising any right, power or remedy shall
operate as a waiver thereof or otherwise prejudice such holder’s rights, powers
or remedies.  No right, power or remedy
conferred by this Agreement or by any Note upon any holder thereof shall be
exclusive of any other right, power or remedy referred to herein or therein or
now or hereafter available at law, in equity, by statute or otherwise.  Without limiting the obligations of the
Company under Section 15, the Company will pay to the holder of each Note on
demand such further amount as shall be sufficient to cover all costs and
expenses of such holder incurred in any enforcement or collection under this
Section 12, including, without limitation, reasonable attorneys’, solicitors’
and barristers’ fees, expenses and disbursements.


 


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13.                               REGISTRATION; EXCHANGE; SUBSTITUTION OF
NOTES.


 


13.1.    Registration of Notes.


 


The Company shall keep at its principal
executive office a register for the registration and registration of transfers
of Notes.  The name and address of each
holder of one or more Notes, each transfer thereof and the name and address of
each transferee of one or more Notes shall be registered in such register.  Prior to due presentment for registration of
transfer, the Person in whose name any Note shall be registered shall be deemed
and treated as the owner and holder thereof for all purposes hereof, and the
Company shall not be affected by any notice or knowledge to the contrary.  The Company shall give to any holder of a
Note that is an Institutional Investor promptly upon request therefor, a
complete and correct copy of the names and addresses of all registered holders
of Notes.


 


13.2.    Transfer and Exchange of Notes.


 


Upon surrender of any Note at the principal executive office of the
Company for registration of transfer or exchange (and in the case of a
surrender for registration of transfer, duly endorsed or accompanied by a
written instrument of transfer duly executed by the registered holder of such
Note or his attorney duly authorized in writing and accompanied by the address
for notices of each transferee of such Note or part thereof), the Company shall
execute and deliver within 10 Business Days, at the Company’s expense (except
as provided below), one or more new Notes of the same Series (as requested by
the holder thereof) in exchange therefor, in an aggregate principal amount
equal to the unpaid principal amount of the surrendered Note.  Each such new Note shall be payable to such
Person as such holder may request and shall be substantially in the form of
Note for such Series set forth in Exhibit 2.1(a), Exhibit 2.1(b), Exhibit
2.1(c) or Exhibit 2.1(d), as the case may be.  Each such new Note shall be dated and bear interest from the date
to which interest shall have been paid on the surrendered Note or dated the
date of the surrendered Note if no interest shall have been paid thereon.  The Company may require payment of a sum
sufficient to cover any stamp tax or governmental charge imposed in respect of
any such transfer of Notes.  Notes shall
not be transferred in denominations of less than US$500,000, provided that if
necessary to enable the registration of transfer by a holder of its entire
holding of Notes, one Note may be in a denomination of less than
US$500,000.  Any


 


105

















 


transferee, by its acceptance of a Note registered in its name (or the
name of its nominee), shall be deemed to have made the representation set forth
in Section 6.


 


13.3.    Replacement of Notes.


 


Upon receipt by the Company of evidence
reasonably satisfactory to it of the ownership of and the loss, theft,
destruction or mutilation of any Note (which evidence shall be, in the case of
an Institutional Investor, notice from such Institutional Investor of such
ownership and such loss, theft, destruction or mutilation), and:


 


(a) in the case of loss, theft or
destruction, of indemnity reasonably satisfactory to it (provided that if the
holder of such Note is a Noteholder which is a party to this Agreement or a
nominee for any such Noteholder, or another holder of a Note with a minimum net
worth of at least US$50,000,000, such Person’s own unsecured agreement of
indemnity shall be deemed to be satisfactory); or


 


(b) in the case of mutilation, upon surrender
and cancellation thereof,


 


the Company at its own expense shall execute
and deliver within 10 Business Days, in lieu thereof, a new Note of the same Series,
dated and bearing interest from the date to which interest shall have been paid
on such lost, stolen, destroyed or mutilated Note or dated the date of such
lost, stolen, destroyed or mutilated Note if no interest shall have been paid
thereon.


 


14.                               PAYMENTS ON NOTES.


 


14.1.    Place of Payment.


 


Subject to Section 14.2, payments of principal, Make-Whole Amount, or
Modified Make-Whole Amount, if any, Additional Payments, if any, and interest
becoming due and payable on the Notes shall be made in New York, New York, USA
at the principal office of HSBC Bank USA, New York in such jurisdiction.


 


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The Company may at any time, by notice to each holder of a Note, change
the place of payment of the Notes so long as such place of payment shall be
either the principal office of the Company in such jurisdiction or the
principal office of a bank or trust company in such jurisdiction.


 


14.2.            Home Office Payment.


 


So long as any Noteholder identified in
Schedule A to this Agreement or its nominee shall be the holder of any Note,
and notwithstanding anything contained in Section 14.1 or in such Note to the
contrary, the Company will pay all sums becoming due on such Note for
principal, Make-Whole Amount or Modified Make-Whole Amount, if any, Additional
Payments, if any, and interest by the method and at the address specified for
such purpose below such Noteholder’s name in Schedule A, or by such other
method or at such other address as such Noteholder shall have from time to time
specified to the Company in writing for such purpose, without the presentation
or surrender of such Note or the making of any notation thereon, except that
upon written request of the Company made concurrently with or reasonably
promptly after payment or prepayment in full of any Note, such Noteholder shall
surrender such Note for cancellation, reasonably promptly after any such
request, to the Company at its principal executive office or at the place of
payment most recently designated by the Company pursuant to Section 14.1. Prior
to any sale or other disposition of any Note held by a Noteholder or its
nominee such Noteholder will, at its election, either endorse thereon the
amount of principal paid thereon and the last date to which interest has been
paid thereon or surrender such Note to the Company in exchange for a new Note
or Notes pursuant to Section 13.2.  The
Company will afford the benefits of this Section 14.2 to any Institutional
Investor that is the direct or indirect transferee of any Note purchased by a
Noteholder under this Agreement and that has made the same agreement relating
to such Note as such Noteholder have made in this Section 14.2.


 


 


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14.3.            Currency of Payment.


 


All payments under this Agreement and the Notes shall be made in US
Dollars.  To the fullest extent
permitted by applicable law, the obligation of the Company in respect of any
amount due under or in respect of this Agreement and the Notes, notwithstanding
any payment in any currency other than US Dollars, whether as a result of (i)
any judgment or order or the enforcement thereof, (ii) the realization on any
security, (iii) the liquidation of the Company or any Guarantor, (iv) any
voluntary payment by the Company or any Guarantor or (v) any other reason,
shall be discharged only to the extent of the amount in US Dollars that each
holder of Notes entitled to receive such payment may, in accordance with normal
banking procedures, purchase in the foreign exchange markets in London, England
with the sum paid in such other currency (after any premium and costs of
exchange) on the Business Day immediately following the day on which such
holder receives such payment and, if the amount in US Dollars that may be so
purchased for any reason is less than the amount originally due, the Company
shall indemnify and save harmless such holder from and against all loss or
damage arising out of or as a result of such deficiency.  This indemnity shall constitute an
obligation separate and independent from the other obligations contained in
this Agreement and the Notes, shall give rise to a separate and independent
cause of action, shall apply irrespective of any indulgence granted by such
holder from time to time and shall continue in full force and effect
notwithstanding any judgment or order for a liquidated sum in respect of an
amount due under this Agreement or the Notes or under any judgment or order.


 


15.                               EXPENSES, ETC.


 


15.1.            Transaction Expenses.


 


Whether or not the transactions contemplated
hereby are consummated, the Company will pay all costs and expenses (including,
without limitation, reasonable attorneys’ fees of a special United States
counsel and a special English counsel and, if reasonably required, other local
counsel) incurred by each holder of a Note in connection with such transactions
and in connection with any amendments, waivers or consents under or in respect
of this Agreement or the


 


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Notes (whether or not such amendment, waiver or consent becomes
effective), including, without limitation: (a) the costs and expenses incurred
in enforcing or defending (or determining whether or how to enforce or defend)
any rights under this Agreement, the Notes or the Guarantees or in responding
to any subpoena or other legal process or informal investigative demand issued
in connection with this Agreement, the Notes or the Guarantees, or by reason of
being a holder of any Note; and (b) the costs and expenses, including, without limitation,
financial advisors’ and reporting or investigating accountants’ fees, incurred
in connection with the insolvency or bankruptcy of the Company or any
Subsidiary or in connection with any work-out or restructuring of the
transactions contemplated hereby and by the Notes and by the Guarantees.  The Company will pay, and will save each
holder of a Note and hold each holder of a Note harmless from, all claims in
respect of any fees, costs or expenses if any, of brokers and finders (other
than those retained by such Noteholder).


 


15.2.            Survival.


 


The obligations of the Company under this
Section 15 will survive the payment or transfer of any Note, the enforcement,
amendment or waiver of any provision of this Agreement or the Notes, and the
termination of this Agreement.


 


16.                               SURVIVAL OF REPRESENTATIONS AND
WARRANTIES; ENTIRE AGREEMENT.


 


All representations and warranties contained herein shall survive the
execution and delivery of this Agreement and the Notes, the purchase or
transfer by any Noteholder of any Note or portion thereof or interest therein
and the payment of any Note, and may be relied upon by any subsequent holder of
a Note, regardless of any investigation made at any time by or on behalf of any
holder of a Note.  All statements
contained in any certificate or other instrument delivered by or on behalf of
the Company pursuant to this Agreement shall be deemed representations and
warranties of the Company under this Agreement.  Subject to the preceding sentence, this Agreement and the Notes
embody the entire agreement


 


109

















 


and understanding between the Noteholders and
the Company and supersede all prior agreements and understandings relating to
the subject matter hereof.


 


17.                               AMENDMENT AND WAIVER.


 


17.1.            Requirements.


 


This Agreement and the Notes may be amended,
and the observance of any term hereof or of the Notes may be waived (either
retroactively or prospectively), with (and only with) the written consent of
the Company and the Required Holders, except that (a) no amendment or waiver of
any of the provisions of Section 1 through Section 6, inclusive, or Section 21
hereof, or any defined term (as it is used therein), will be effective as to
any Noteholder unless consented to by each Noteholder in writing, and (b) no
such amendment or waiver may, without the written consent of the holder of each
Note at the time outstanding affected thereby, (i) subject to the provisions of
Section 12 relating to acceleration or rescission, change the amount or time of
any prepayment or payment of principal of, or reduce the rate or change the
time of payment or method of computation of interest or of the Make-Whole
Amount or Modified Make-Whole Amount on, the Notes, (ii) change the percentage
of the principal amount of the Notes the holders of which are required to
consent to any such amendment of waiver, or (iii) amend any of Section 8,
Section 11(a), Section 11(b), Section 12, Section 14.3, this Section 17,
Section 20 or Section 22.


 


17.2.            Solicitation of Holders of Notes.


 


(a) Solicitation.  The Company will provide each
Noteholder (irrespective of the amount of Notes then owned by it) with
sufficient information, sufficiently far in advance of a date of decision is
required, to enable such holder to make an informed and considered decision
with respect to any proposed amendment, waiver or consent in respect of any of
the provisions hereof or of the Notes. 
The Company will deliver executed or true and correct copies of each
amendment, waiver or consent effected


 


110

















 


pursuant to the provisions of this Section 17
to each holder of outstanding Notes promptly following the date on which it is
executed and delivered by, or receives the consent of approval of, the requisite
holders of Notes.


 


(b) Payment.  The Company will not directly or
indirectly pay or cause to be paid any remuneration, whether by way of
supplemental or additional interest, fee or otherwise, or grant any security,
to any holder of Notes as consideration for or as an inducement to the entering
into by any holder of Notes of any waiver or amendment of any of the terms and
provisions hereof unless such remuneration is concurrently paid, or security is
concurrently granted, on the same terms, ratably to each holder of Notes then
outstanding even if such holder did not consent to such waiver or amendment.


 


17.3.                     Binding Effect, etc.


 


Any amendment or waiver consented to as
provided in this Section 17 applies equally to all holders of Notes and is
binding upon them and upon each future holder of any Note and upon the Company
without regard to whether such Note has been marked to indicate such amendment
or waiver.  No such amendment or waiver
will extend to or affect any obligation, covenant, agreement, Default or Event
of Default not expressly amended or waived or impair any right consequent
thereon.  No course of dealing between
the Company and the holder of any Note nor any delay in exercising any rights
hereunder or under any Note shall operate as a waiver of any rights of any
holder of such Note.  As used herein,
the term “this
Agreement”  and references thereto shall mean this Agreement as
it may from time to time be amended or supplemented.


 


17.4.       Notes held by the Company, etc.


 


Solely for the purpose of determining whether
the holders of the requisite percentage of the aggregate principal amount of
Notes then outstanding approved or consented to any amendment, waiver or
consent to be given under this


 


111

















 


Agreement or the Notes, or have directed the
taking of any action provided herein or in the Notes to be taken upon the
direction of the holders of a specified percentage of the aggregate principal
amount of Notes then outstanding, Notes directly or indirectly owned by the
Company or any of its Subsidiaries or other Affiliates shall be deemed not to
be outstanding.


 


18.                               NOTICES.


 


All notices and communications provided for
hereunder shall be in writing and sent (a) by telecopy if the sender on the
same day sends a confirming copy of such notice by an
internationally-recognized expedited delivery service (charges prepaid), or (b)
by an internationally-recognized expedited delivery service (with charges
prepaid).  Any such notice must be sent:


 


(i)        if to a Noteholder
identified on Schedule A to this Agreement or its nominee, to such Noteholder
or nominee at the address specified for such communications in Schedule A, or
at such other address as such Noteholder or nominee shall have specified to the
Company in writing;


 


(ii)      if to any other holder
of any Note, to such holder at such address as such other holder shall have
specified to the Company in writing, or


 


(iii)     if to the Company, to
the Company at Spirent plc, Spirent House, Crawley Business Quarter, Fleming
Way, Crawley, West Sussex RH10 9QL, England, Attention:  Head of Financial Reporting; fax number:
+44-1293-767677 and (for all notices in respect of a Default or an Event of
Default) Attention:  Company Secretary;
fax number: +44-1293-767929; with a copy in each case to Attention:  Group Treasurer; fax number:
+44-1293-767944, or at such other address as the Company shall have specified
to the holder of each Note in writing.


 


Notices under this Section 18 will be deemed given only when actually
received.


 


112

















 


19.          REPRODUCTION OF DOCUMENTS.


 


This Agreement and all documents relating
hereto, including, without limitation, (a) consents, waivers and modifications
that may hereafter be executed, (b) documents received by any Noteholder at any
closing (except the Notes themselves), and (c) financial statements,
certificates and other information previously or hereafter furnished to any
Noteholder, may be reproduced by such Noteholder by any photographic, photostatic,
microfilm, microcard, miniature photographic or other similar process and such
Noteholder may destroy any original document so reproduced.  The Company agrees and stipulates that, to
the extent permitted by applicable law, any such reproduction shall be
admissible in evidence as the original itself in any judicial or administrative
proceeding (whether or not the original is in existence and whether or not such
reproduction was made by such Noteholder in the regular course of business) and
any enlargement, facsimile or further reproduction of such reproduction shall
likewise be admissible in evidence. 
This Section 19 shall not prohibit the Company or any other holder of
Notes from contesting any such reproduction to the same extent that it could
contest the original, or from introducing evidence to demonstrate the
inaccuracy of any such reproduction.


 


20.                               CONFIDENTIAL INFORMATION.


 


For the purposes of this Section 20, “Confidential Information”  means
information delivered to any Noteholder by or on behalf of the Company or any
Subsidiary in connection with the transactions contemplated by or otherwise
pursuant to this Agreement that is proprietary in nature and that was clearly
marked or labeled or otherwise adequately identified when received by such Noteholder
as being confidential information of the Company or such Subsidiary, provided
that such term does not include information that:


 


(a) was publicly known or otherwise known to
any Noteholder prior to the time of such disclosure;


 


(b) subsequently becomes publicly known
through no act or omission by


 


113

















 


any Noteholder or any Person acting on its
behalf;


 


(c) otherwise becomes known to any Noteholder
other than through disclosure by the Company or any Subsidiary; or


 


(d) constitutes financial statements
delivered to any Noteholder under Section 7.1(A) or Section 7.1(B), as the case
may be, that are otherwise publicly available.


 


Each Noteholder will maintain the
confidentiality of such Confidential Information in accordance with procedures
adopted by it in good faith to protect confidential information of third
parties delivered to it, provided that such Noteholder may deliver or disclose
Confidential Information to:


 


(i)                                  its
directors, officers, trustees, employees, agents, attorneys (including
solicitors and barristers) and Affiliates (to the extent such disclosure
reasonably relates to the administration of the investment represented by its
Notes);


 


(ii)                              its
financial advisors and other professional advisors who agree to hold
Confidential Information substantially in accordance with the terms of this
Section 20;


 


(iii)                          any
other holder of any Note;


 


(iv)                            any
Institutional Investor to which it sells or offer to sell such Note or any part
thereof or any participation therein (if such Person has agreed in writing
prior to its receipt of such Confidential Information to be bound by the
provisions of this Section 20);


 


(v)                                any
Person from which such Noteholder offers to purchase any security of the
Company (if such Person has agreed in writing prior to its receipt of such
Confidential Information to be bound by the provisions of this Section 20);


 


(vi)                            any
federal or state regulatory authority having jurisdiction


 


114

















 


over such Noteholder;


 


(vii)                        the
National Association of Insurance Commissioners or any similar organization, or
any nationally recognized rating agency that requires access to information
about such Noteholder’s investment portfolio; or


 


(viii)                    any other
Person to which such delivery or disclosure may be necessary or appropriate (w)
to effect compliance with any law, rule, regulation or order applicable to such
Noteholder, (x) in response to any subpoena or other legal process, (y) in
connection with any litigation to which such Noteholder is a party or (z) if an
Event of Default has occurred and is continuing, to the extent such Noteholder
may reasonably determine such delivery and disclosure to be necessary or
appropriate in the enforcement or for the protection of the rights and remedies
under its Notes, this Agreement and the Guarantees.


 


Each holder of a Note, by its acceptance of a
Note, will be deemed to have agreed to be bound by and to be entitled to the
benefits of this Section 20 as though it were a party to this Agreement.  On reasonable request by the Company in
connection with the delivery to any holder of a Note of information required to
be delivered to such holder under this Agreement or requested by such holder
(other than a holder that is a party to this Agreement or its nominee), such
holder will enter into an agreement with the Company embodying the provisions
of this Section 20.


 


21.                               INTENTIONALLY OMITTED.


 


115

















 


22.                               TAX INDEMNIFICATION.


 


22.1.    Payments Free and Clear; Gross-Up of
Payments Subject to Taxes.


 


All payments whatsoever under this Agreement
and the Notes will be made free and clear of, and without liability or
withholding or deduction for or on  account of, any present or future Tax imposed or
levied by or on behalf of (a) the  United
Kingdom (or any political subdivision or taxing authority thereof or
therein) or (b) any other jurisdiction (or
any political subdivision or taxing  authority
thereof or therein) other than the United States of America (or any  political subdivision or taxing authority thereof or
therein) (x) from or through  which
any amount is paid by the Company pursuant to the terms of this  Agreement or the Notes or (y) which is a jurisdiction
of residence of the Company  for
tax purposes (any such jurisdiction described in clause (a) or (b) above being
hereinafter referred to as a “Taxing Jurisdiction”), unless the withholding or  deduction of such Tax is compelled by law.



 


If any deduction or withholding for any Tax
of a Taxing Jurisdiction shall at any time be required in respect of any
amounts to be paid by the Company  under this Agreement or the Notes, the Company will
pay on demand such  additional
amounts (including any required deduction, withholding or other  payment of Tax on or with respect to such additional
amount) as may be necessary  in
order that the net amounts received by each holder pursuant to the terms of
this  Agreement or the Notes,
after such deduction or withholding, shall equal the  amounts that would have been received had no such
deduction or withholding  been
required; provided that no payment of any additional amounts shall be
required to be made for or on account of:



 


(a)  any Tax which would not have
been imposed but for the existence of  any
present or former connection between such holder (or between a  fiduciary, settlor, beneficiary, member of,
shareholder of, or possessor of a  power
over, such holder, if such holder is an estate, trust, partnership or
corporation, or any Person other than the
holder to whom the relevant Note  or
any amount payable thereon is attributable for the purposes of such Tax)
and the United Kingdom, other than the mere
holding of the relevant Note  or
the enforcement by such holder of, or the taking of any action by such
holder to enforce, any of the rights and
remedies of such holder thereunder  or
under this Agreement, including without limitation such holder (or such
other Person described in the above
parenthetical) being or having been a  


 


116

















 


citizen or resident thereof, or being or
having been engaged in a trade or business therein or having (or, for the
avoidance of doubt, holding the Note through) an establishment therein; 


 


(b) any estate, inheritance, gift, sale,
transfer, personal property or similar tax, assessment or other governmental
charge;


 


(c) any Tax that is imposed or withheld by
reason of the failure by such holder (regardless of when such holder acquired
the relevant Note) in the filing of forms, certificates, documents or returns
or other reasonably required evidence (collectively “Forms”),
required to be filed by such holder to avoid or reduce such Tax in due time to
enable the Company to make the payment in question free of, or at a reduced
rate of, Tax, provided that no holder of a Note shall be considered to have
delayed or failed to file Forms (i) in the case of any Form other than an
Inland Revenue Form FD 13 (or its counterpart for noncorporate holders), if
such Form would involve the disclosure of confidential or proprietary tax
returns or other information reasonably deemed confidential or proprietary by
the applicable holder, (ii) if such holder has filed the appropriate Forms with
the IRS (or other appropriate authority) at least 150 days prior to the payment
in question (provided however that, notwithstanding the foregoing, the
completion of a United Kingdom Inland Revenue Form FD 13 with respect to the
Company and filing thereof with the IRS within 60 days after the Effective Date
(to the extent not already filed in connection with the Existing Note Purchase
Agreements) by any Noteholder shall be deemed to be full compliance with
respect to all such requirements specified in the clause (c) above in
connection with such Noteholders purchase of Notes at such closing), or (iii)
in the case of Forms not required under existing law and practices as of the
date hereof or Forms for any Taxing Jurisdictions other than the United
Kingdom, unless the Company has requested that such Forms be filed (and has
furnished such Forms to such holder) and such holder has had a reasonable
period of time (but, in any case, no less than 60 days) to file such Forms; 


 


117

















 


(d) any Tax which is payable otherwise than
by withholding from an amount payable under this Agreement or the Notes;


 


(e) or any combination of clauses (a), (b),
(c) and (d) above;


 


provided , further that no such additional
amounts shall be payable in respect of any Note to any holder of a Note in respect
of Tax which would not have arisen but for (1) the failure of such holder (or
if such holder is an estate, trust or partnership, a fiduciary, settlor,
possessor of a power over, beneficiary or member of such holder) to be a
resident of the United States of America for purposes of a tax treaty between
the United States and the Taxing Jurisdiction but only to the extent that such
additional amounts are in excess of the hypothetical additional amounts which
the Company would have been obligated to pay hereunder if such holder were a
resident in the United States of America and were eligible in full for the
benefits of such treaty with respect to interest received from the Company
(assuming that the Company and such Persons had made and obtained all relevant
claims and authorizations required under such treaty), (2) the sale by such
holder, or the agreement by such holder to sell, a Note within three months of
the acquisition of such Note, if such holder is a tax-exempt entity or (3) such
holder not being the beneficial owner of the entire interest with respect to
which such Tax is payable. 


 


The Company will furnish to the holders of
the Notes an official receipt, if any, issued by the relevant taxation or other
authorities involved for all amounts deducted or withheld as aforesaid, such
receipt to be so furnished promptly after the issuance thereof. 


 


22.2.            Tax
Refunds.


 


Each holder of a Note, by acceptance of such
Note, agrees that, with reasonable promptness after receiving written notice
from the Company to the effect that such holder is eligible for a refund in
respect of Taxes actually paid by the Company pursuant to this Section 22, such
holder will sign and deliver to or as reasonably directed by the Company any
Form provided to such holder by the 


 


118

















 


Company to enable such holder to obtain a refund in respect of such
Taxes; and if such holder thereafter receives such refund in respect of such
Taxes; such holder will promptly pay such refund to the Company (together with
interest, if any, received by such holder from the relevant taxing
authority).  If a holder applies for a
refund of such Taxes prior to a request by the Company to apply for such a
refund, upon receipt of a request by the Company to apply for a refund or to
turn over the proceeds of any such refund, the holder will pay any such refund
to the Company (together with interest, if any, received by such holder from
the relevant taxing authority) promptly upon receipt of such refund, or if later,
promptly upon receipt of the request from the Company.  The Company agrees to pay all reasonable
out-of-pocket expenses incurred by a holder in connection with obtaining such
refund.  The foregoing notwithstanding,
nothing in this Section 22 shall:


 


(a) restrict the right of any recipient to
arrange its tax affairs as it shall think fit;


 


(b) require any recipient to disclose any
information regarding its tax affairs which, in such recipient’s reasonable and
good faith judgment, constitutes confidential or proprietary information; or


 


(c) require any recipient to account for any
indirect taxation benefits arising from the deduction or withholding of any
Tax.


 


22.3.            Additional Tax Indemnity for
Outstanding Company Notes.


 


Pursuant to Section 2.1(b) of the Existing
Note Purchase Agreements and subject to the terms of the Existing Note Purchase
Agreements, the Company agreed to exchange Outstanding Company Notes for
Existing Notes.  In the event that any
exchange of Outstanding Company Notes for Existing Notes pursuant to Section
2.1(b) of the Existing Note Purchase Agreements shall be deemed to constitute
an exchange which results in any tax liability to any holder of Notes under any
U.S. federal, state or local tax law providing for taxes on or measured by income
or gains (the “Holder
Tax Amount”), the Company, upon
written


 


119

















 


notice thereof from such holder, shall promptly pay to such holder an
amount equal to the applicable Holder Tax Amount (together with interest and
penalties, if any) and any additional U.S. federal, state or local taxes on or
measured by income or gains which are imposed on such holder’s receipt of the
Holder Tax Amount and other amounts payable to such holder as provided in this
Section 22.3, provided that the Holder Tax Amount shall be reduced by the
present value (determined using the after-tax equivalent of the interest rate
on the Notes for which such holder’s Outstanding Company Notes were exchanged)
of U.S. federal, state or local tax benefits related to such exchange and
reasonably expected to be available to such holder, including any benefits
expected to result from amortization of bond premium that would not have been
available but for the exchange.  For
this purpose, it shall be assumed that such holder’s adjusted tax basis in the
Outstanding Company Notes at the time of the exchange is at least equal to the
principal amount of such Outstanding Company Notes at such time.  At the request of the Company, a holder of
Notes shall contest any assertion of any Holder Tax Amount with respect to such
Holder at the Company’s expense.  To the
extent reasonably permitted under U.S. federal, state or local tax law, such
holder agrees in filing its tax returns to treat the exchange in such a manner
that will not give rise to any Holder Tax Amount (but only if there is, in such
holder’s sole opinion, substantial authority for such treatment).  All calculations required pursuant to this
Section 22.3 and any determinations and assumptions necessary to perform such
calculations shall be made in such holder’s reasonable good faith
judgment.  Nothing in this Section
22.3(a) shall require such holder to disclose any information regarding its tax
affairs (including, without limitation, its tax records and returns) other than
information necessary to determine the applicability of this Section 22.3 or to
make any determination or calculation hereunder, or shall be construed in any
way as to afford the Company access to such holder’s tax records or returns
under any circumstances, or (b) shall restrict the right of such holder to
arrange its tax affairs as it shall think fit.


 


22.4.            Survival of Obligations.


 


The obligations of the Company and the
holders under this Section 22 will


 


120

















 


survive the payment or transfer of any Note and the termination of this
Agreement.


 


23.                               MISCELLANEOUS.


 


23.1.    Successors and Assigns.


 


All covenants and other agreements contained in this Agreement by or on
behalf of any of the parties hereto bind and inure to the benefit of their
respective successors and assigns (including, without limitation, any
subsequent holder of a Note) whether so expressed or not.


 


23.2.    Payments Due on Non-Business Days.


 


Anything in this Agreement or the Notes to
the contrary notwithstanding, any payment of principal of or Make-Whole Amount
or Modified Make-Whole Amount or interest on any Note that is due on a date
other than a Business Day shall be made on the next succeeding Business Day
without including the additional days elapsed in the computation of the
interest payable on such next succeeding Business Day.


 


23.3.    Severability.


 


Any provision of this Agreement that is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall (to the full extent permitted by
law) not invalidate or render unenforceable such provision in any other
jurisdiction.


 


23.4.    Construction.


 


Each covenant contained herein shall be
construed (absent express


 


121

















 


provision to the contrary) as being independent of each other covenant
contained herein, so that compliance with any one covenant shall not (absent
such an express contrary provision) be deemed to excuse compliance with any
other covenant. Where any provision herein refers to action to be taken by any
Person, or which such Person is prohibited from taking, such provision shall be
applicable whether such action is taken directly or indirectly by such Person.


 


23.5.    Counterparts.


 


This Agreement may be executed in any number
of counterparts, each of which shall be an original but all of which together
shall constitute one instrument. Each counterpart may consist of a number of
copies hereof, each signed by less than all, but together signed by all, of the
parties hereto.


 


23.6.    Jurisdiction; Service of Process.


 


THE COMPANY HEREBY IRREVOCABLY AND
UNCONDITIONALLY AGREES THAT ANY SUIT, ACTION OR PROCEEDING WITH RESPECT TO THIS
AGREEMENT OR ANY NOTE, OR ANY ACTION OR PROCEEDING TO EXECUTE OR OTHERWISE
ENFORCE ANY JUDGMENT IN RESPECT OF ANY BREACH THEREOF, BROUGHT BY ANY HOLDER OF
A NOTE AGAINST THE COMPANY OR ANY OF ITS PROPERTY, MAY BE BROUGHT BY SUCH
HOLDER OF A NOTE IN THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT
OF NEW YORK OR ANY NEW YORK STATE COURT SITTING IN NEW YORK CITY AS SUCH HOLDER
OF A NOTE MAY IN ITS SOLE DISCRETION ELECT, AND, BY THE EXECUTION AND DELIVERY
OF THIS AGREEMENT, THE COMPANY IRREVOCABLY SUBMITS TO THE JURISDICTION OF EACH
SUCH COURT AND AGREES THAT PROCESS SERVED EITHER PERSONALLY OR BY REGISTERED
MAIL SHALL, TO THE EXTENT PERMITTED BY LAW, CONSTITUTE ADEQUATE SERVICE OF
PROCESS IN ANY SUCH SUIT. WITHOUT LIMITING THE FOREGOING, THE COMPANY HEREBY
APPOINTS, IN THE CASE OF


 


122

















 


ANY
SUCH ACTION OR PROCEEDING BROUGHT IN THE COURTS OF OR IN THE STATE OF
NEW YORK, SPIRENT HOLDINGS CORPORATION WITH OFFICES AT 1300 VETERANS
MEMORIAL HIGHWAY, HAUPPAUGE, NEW YORK, 11788, TO RECEIVE, FOR IT AND ON ITS
BEHALF, SERVICE OF PROCESS IN THE STATE OF NEW YORK WITH RESPECT THERETO,
PROVIDED THE COMPANY MAY APPOINT ANY OTHER PERSON, REASONABLY ACCEPTABLE TO THE
REQUIRED HOLDERS, WITH OFFICES IN THE STATE OF NEW YORK TO REPLACE SUCH AGENT
FOR SERVICE OF PROCESS UPON DELIVERY TO THE HOLDERS OF A REASONABLY ACCEPTABLE
AGREEMENT OF SUCH NEW AGENT AGREEING SO TO ACT.  IN ADDITION, THE COMPANY HEREBY IRREVOCABLY WAIVES, TO THE
FULLEST EXTENT PERMITTED BY LAW, ANY OBJECTION WHICH IT MAY NOW OR HEREAFTER
HAVE TO THE LAYING OF VENUE IN ANY SUIT, ACTION OR PROCEEDING ARISING OUT OF OR
RELATING TO THIS AGREEMENT OR ANY NOTE BROUGHT IN THE SAID COURTS, AND HEREBY
IRREVOCABLY WAIVES ANY CLAIM THAT ANY SUCH SUIT, ACTION OR PROCEEDING BROUGHT
IN ANY SUCH COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM.  NOTHING HEREIN SHALL IN ANY WAY BE DEEMED TO
LIMIT THE ABILITY OF ANY HOLDER OF A NOTE TO SERVE ANY SUCH WRITS, PROCESS OR
SUMMONSES, IN ANY MANNER PERMITTED BY APPLICABLE LAW OR TO OBTAIN JURISDICTION
OVER THE COMPANY, IN SUCH OTHER JURISDICTION, AND IN SUCH MANNER, AS MAY BE
PERMITTED BY APPLICABLE LAW.


 


23.7.            Governing
Law.


 


THIS
AGREEMENT SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, AND THE RIGHTS OF
THE PARTIES SHALL BE GOVERNED BY, THE LAW OF THE STATE OF NEW YORK EXCLUDING
CHOICE-OF-LAW PRINCIPLES OF THE LAW OF SUCH STATE THAT WOULD REQUIRE THE
APPLICATION OF THE LAWS OF A JURISDICTION OTHER THAN SUCH STATE.


 


123

















 


23.8.            Accounting Principles.


 


(a) Accounting Principles.        Notwithstanding any changes in UK GAAP or
the interpretation or application thereof subsequent to December 31, 2002, all
financial covenants herein (including those in Section 10 and the Normalization
Conditions) shall be calculated in accordance with (and compliance shall be
determined solely by reference to) UK GAAP in effect as at December 31, 2002
and as applied by the Company as of such date. 
In the event that there should occur after December 31, 2002 any changes
in UK GAAP or the interpretation or application thereof which would have a
quantifiable effect on the calculation of the financial covenants or the
Normalization Conditions, the Company agrees to provide to each of holder of a
Note, in addition to the financial information described in Section 7, such
supplemental financial information with respect to the relevant accounting periods
(calculated in accordance with UK GAAP) affected by such changes as is
reasonably necessary to allow the holders of the Notes to verify compliance
with the financial covenants and the Normalization Conditions.


 


(b) Generally.      Unless
otherwise provided herein, all financial statements delivered in connection
herewith will be prepared in accordance with UK GAAP as in effect as at the
date of, or during the period covered by such financial statements.  Unless otherwise provided herein, where the
character or amount of any asset or liability or item of income or expense, or
any consolidation or other accounting computation is required to be made for
any purpose hereunder, it shall be done in accordance with UK GAAP as in effect
on the date of, or at the end of the period covered by, the financial
statements from which such asset, liability, item of income, or item of
expense, is derived, or, in the case of any such computation, as in effect on
the date as of which such computation is required to be determined provided
that if any term defined herein includes or excludes amounts, items or concepts
that would not be included in or excluded from such term if such term was
defined with reference solely to UK GAAP, such term will


 


124

















 


be deemed to include or exclude such amounts,
items or concepts as set forth herein.


 


(c) Form of
Accounts.  Subject to Section
23.8(a), if, at any time, the Company proposes to change the accounting
policies upon which any of the information provided pursuant to Section
7.1(A)(a), Section 7.1(A)(b), Section 7.1(A)(d), Section 7.1(B)(a), Section
7.1(B)(b), Section 7.1(B)(c), the financial covenants set out in Section 10 or
the Normalization Conditions is prepared, then:


 


(i)                                  it
shall notify each of the Noteholders of the proposed change;


 


(ii)                              within
five Business Days of receipt of the notification, it and the Noteholders shall
enter into good faith discussions for a period of not more than 60 days with a
view to agreeing the amendments which would be required to be made to this
Agreement (including, without limitation, the financial covenants set forth in
Section 10 and the Normalization Conditions) to reflect the basis upon which
this Agreement was entered into by it and the Noteholders; and


 


(iii)                          if no
agreement is reached under sub-clause (ii) above, then no such amendments shall
be made.


 


Any such amendments shall be made in accordance with Section 17.


 


(d)
Currency.       With respect to
any determination, consolidation or accounting computation required hereby, any
amounts not denominated in the currency in which this Agreement specifies shall
be converted to such currency in accordance with the requirements of UK GAAP
(as such requirements relate to such determination, consolidation or computation)
and, if no such requirements shall exist, converted to such currency in
accordance with normal banking procedures, at the closing rate as reported in
the most recent Financial Times (London edition) as of the date of such
determination, consolidation or computation or, if no such quotation shall then
be available, as quoted on such date by any bank reasonably


 


125

















 


acceptable to the Required Holders and the
Company.


 


126

















 


If you are in agreement with the foregoing,
please sign the form of agreement on the accompanying counterpart of this
Agreement and return it to the Company, whereupon the foregoing shall become a
binding agreement between you and the Company.


 


 


	
   

  	
   

  	
   

  	
   

  	
  Very truly yours,

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  SPIRENT plc

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  By

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
   

  	
   

  	
  Title:

  



 


 

















 


The foregoing is hereby


agreed to as of the


date thereof.


 


 


	
  METROPOLITAN LIFE INSURANCE COMPANY

  
	
   

  
	
   

  
	
  By

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  
				



 


 

















 


The foregoing is hereby


agreed to as of the


date thereof.


 


 


	
  ONE MADISON INVESTMENTS (CAYCO) LIMITED

  
	
  By:

  	
  Metropolitan Life Insurance Company,

  
	
   

  	
  as Investment Manager

  
	
   

  	
   

  
	
   

  
	
   

  	
  By

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
					



 


 

















 


The foregoing is hereby


agreed to as of the


date thereof.


 


 


	
  METROPOLITAN INSURANCE AND ANNUITY COMPANY

  
	
   

  	
   

  
	
   

  	
   

  
	
  By

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  
					



 


 

















 


The foregoing is hereby


agreed to as of the


date thereof.


 


 


	
  METROPOLITAN PROPERTY AND CASUALTY

  INSURANCE COMPANY

  
	
   

  	
   

  
	
   

  	
   

  
	
  By

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  
				



 


 

















 


The foregoing is hereby


agreed to as of the


date thereof.


 


 


	
  TEACHERS INSURANCE AND ANNUITY

  ASSOCIATION OF AMERICA

  
	
   

  
	
   

  
	
  By

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  
				



 


 

















 


The foregoing is hereby


agreed to as of the


date thereof.


 


 


	
  THE LINCOLN NATIONAL LIFE INSURANCE COMPANY

  
	
  By:

  	
  Delaware Investment Advisers, a Series of
  Delaware

  
	
   

  	
  Management Business Trust, Its
  Attorney-in-Fact

  
	
   

  
	
   

  
	
  By

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  
					



 


 

















 


The foregoing is hereby


agreed to as of the


date thereof.


 


 


	
  LINCOLN LIFE & ANNUITY COMPANY OF NEW
  YORK

  
	
  By: 

  	
  Delaware Investment Advisers, a Series of
  Delaware

  
	
   

  	
  Management Business Trust, Its
  Attorney-in-Fact

  
	
   

  	
   

  
	
   

  	
   

  
	
  By

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  
					



 


 

















 


The foregoing is hereby


agreed to as of the


date thereof.


 


 


	
  FIRST PENN-PACIFIC LIFE INSURANCE COMPANY

  	
   

  
	
  By:

  	
  Delaware Investment Advisers, a Series of
  Delaware

  
	
   

  	
  Management Business Trust, Its
  Attorney-in-Fact

  
	
   

  	
   

  
	
   

  	
   

  
	
  By 

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  
						



 


 

















 


The foregoing is hereby


agreed to as of the


date thereof.


 


 


	
  THE TRAVELERS INSURANCE COMPANY

  
	
   

  	
   

  
	
   

  	
   

  
	
  By

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  
				



 


 

















 


The foregoing is hereby


agreed to as of the


date thereof.


 


 


	
  PRIMERICA LIFE INSURANCE COMPANY

  
	
   

  
	
   

  
	
  By

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  
				



 


 

















 


The foregoing is hereby


agreed to as of the


date thereof.


 


 


	
  CONNECTICUT GENERAL LIFE INSURANCE COMPANY

  	
   

  
	
  By:

  	
  CIGNA Investments, Inc. (authorized agent)

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  
					



 


 

















 


The foregoing is hereby


agreed to as of the


date thereof.


 


 


	
  LIFE INSURANCE COMPANY OF NORTH AMERICA

  	
   

  
	
  By:

  	
  CIGNA Investments, Inc. (authorized agent)

  
	
   

  	
   

  
	
   

  	
   

  
	
  By

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  
					



 


 

















 


The foregoing is hereby


agreed to as of the


date thereof.


 


 


	
  MASSACHUSETTS MUTUAL LIFE INSURANCE COMPANY

  
	
   

  	
   

  
	
   

  	
   

  
	
  By 

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  
				



 


 

















 


The foregoing is hereby


agreed to as of the


date thereof.


 


 


	
  SWISS RE Life & Health America Inc

  	
   

  
	
  By:

  	
  Swiss Re Asset Management Inc.

  
	
   

  	
   

  
	
   

  	
   

  
	
  By

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  
					



 


 

















 


EXHIBIT 2.1(a)


 


FORM OF AMENDED AND RESTATED SERIES A NOTE 


 


SPIRENT plc


 


AMENDED AND RESTATED SERIES A SENIOR NOTE DUE
NOVEMBER 23, 2006


 


	
  No. RA-[        ]

  	
   

  	
  [DATE]

  
	
  US$[          ]

  	
   

  	
  PPN: 103084 A* 0

  



 


FOR VALUE RECEIVED,
the undersigned, SPIRENT plc (formerly
known as Bowthorpe plc herein and called the “Company”),
a limited company organized and existing under the laws of England and Wales
with registered number 470893, hereby promises to pay to [                                            ], or registered assigns, the principal sum
of [                                       ]  US
DOLLARS (US$ [                   ]) on November 23, 2006, with interest
(computed on the basis of a 360-day year of twelve 30-day months) (a) on the
unpaid balance thereof at the rate of (i) 7.94% per annum prior to the Effective Date (as defined in the
Amended and Restated Note Purchase Agreement, as hereinafter defined), payable
semiannually, on the 23rd day of November and May in each year until the
principal hereof shall have become due and payable or until the Effective Date,
whichever occurs first, (ii) 9.19% per annum
on and after the Effective Date, payable semiannually, on the 23rd day of
November and May in each year, commencing with the November 23 or May 23 next succeeding
the Effective Date, until the principal hereof shall have become due and
payable or prior to and including the Normalization Date (as defined in the
Amended and Restated Note Purchase Agreement), whichever occurs first, and
(iii) 8.94% per annum after the
Normalization Date, payable semiannually, on the 23rd day of November and May
in each year, commencing with the November 23 or May 23 next succeeding the
Normalization Date, until the principal hereof shall have become due and
payable and (b) to the extent permitted by law on any overdue payment
(including any overdue prepayment) of principal, any overdue payment of
interest and any overdue payment of any Make-Whole Amount or Modified
Make-Whole Amount (each as defined in the Amended and Restated Note Purchase
Agreement), payable semiannually as aforesaid (or, at the option of the
registered holder hereof, on demand), at a rate per annum from time to time equal to the greater of (i) (A)
9.94% prior to the Effective Date, (B) 11.19% on and after the Effective Date
but prior to and including the Normalization Date, and (C) 10.94% after the
Normalization Date or (ii) 2.00% over the rate of interest publicly announced
by Citibank, N.A. from time to time in New York, New York as its “base” or
“prime” rate.


 


Payments of principal of, interest on and any Make-Whole Amount or
Modified Make-Whole Amount with respect to this Note are to be made in lawful
money of the Untied States of America at the office of HSBC Bank USA, New York
in New York, New York or at such other place as the Company shall have
designated by written notice to


 


1

















 


the holder of this Note as provided in the
Amended and Restated Note Purchase Agreement.


 


This Note is one of the Amended and Restated Series A Senior Notes due
November 23, 2006 (herein called the “Notes”)
issued pursuant to separate Note Purchase Agreements, dated November 23, 1999
as amended and restated pursuant to an Amended and Restated Note Purchase
Agreement, dated March 11, 2003 (as from time to time amended, the “Amended and Restated Note Purchase Agreement”),
between the Company and the respective holders of the Notes (amongst others)
listed in Schedule A thereto and is entitled to the benefits thereof.  Each holder of this Note will be deemed, by
its acceptance hereof, (i) to have agreed to the confidentiality provisions set
forth in Section 20 of the Amended and Restated Note Purchase Agreement and
(ii) to have made the representation set forth in Section 6 of the Amended and
Restated Note Purchase Agreement.


 


This Note is a registered Note and, as provided in the Amended and
Restated Note Purchase Agreement, upon surrender of this Note for registration
of transfer, duly endorsed, or accompanied by a written instrument of transfer
duly executed, by the registered holder hereof or such holder’s attorney duly
authorized in writing, a new Note for a like principal amount will be issued
to, and registered in the name of, the transferee.  Prior to due presentment for registration of transfer, the
Company may treat the person in whose name this Note is registered as the owner
hereof for the purpose of receiving payment and for all other purposes, and the
Company will not be affected by any notice to the contrary.


 


This Note is subject to optional prepayment, in whole or from time to
time in part, and subject to mandatory prepayment in certain circumstances,
each at the times and on the terms specified in the Amended and Restated Note
Purchase Agreement, but not otherwise.


 


If an Event of Default, as defined in the Amended and Restated Note
Purchase Agreement, occurs and is continuing, the principal of this Note may be
declared or otherwise become due and payable in the manner, at the price
(including any applicable Make-Whole Amount) and with the effect provided in
the Amended and Restated Note Purchase Agreement.


 


THIS NOTE SHALL BE CONSTRUED AND ENFORCED IN
ACCORDANCE WITH, AND THE RIGHTS OF THE COMPANY AND THE HOLDER HEREOF SHALL BE
GOVERNED BY, THE LAW OF THE STATE OF NEW YORK EXCLUDING CHOICE-OF-LAW
PRINCIPLES OF THE LAW OF SUCH STATE THAT WOULD REQUIRE THE APPLICATION OF THE
LAWS OF A JURISDICTION OTHER THAN SUCH STATE.


 


	
   

  	
  SPIRENT plc

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  



 


2

















 


EXHIBIT
2.1(b)


 


FORM OF AMENDED AND RESTATED SERIES B NOTE


 


SPIRENT plc


 


AMENDED AND RESTATED SERIES B SENIOR NOTE DUE
NOVEMBER 23, 2009


 


	
  No. RB-[       ]

  	
   

  	
  [DATE]

  
	
  US$[        ]

  	
   

  	
  PPN: 103084 A@ 8

  



 


FOR VALUE RECEIVED,
the undersigned, SPIRENT  plc (formerly known as Bowthorpe plc herein
and called the “Company”), a
limited company organized and existing under the laws of England and Wales with
registered number 470893, hereby promises to pay to [                                  ], or registered assigns, the principal sum
of [                                    ]  US
DOLLARS (US$[                 ]) on November 23, 2009, with interest
(computed on the basis of a 360-day year of twelve 30-day months) (a) on the
unpaid balance thereof at the rate of (i) 8.06% per annum prior to the Effective Date (as defined in the
Amended and Restated Note Purchase Agreement, as hereinafter defined), payable
semiannually, on the 23rd day of November and May in each year until the
principal hereof shall have become due and payable or until the Effective Date,
whichever occurs first, (ii) 9.31% per annum
on and after the Effective Date, payable semiannually, on the 23rd
day of November and May in each year, commencing with the November 23 or May 23
next succeeding the Effective Date, until the principal hereof shall have
become due and payable or prior to and including the Normalization Date (as
defined in the Amended and Restated Note Purchase Agreement), whichever occurs
first,  and (iii) 9.06% per annum after the Normalization Date,
payable semiannually, on the 23rd day of November and May in each year,
commencing with the November 23 or May 23 next succeeding the Normalization
Date, until the principal hereof shall have become due and payable and (b) to
the extent permitted by law on any overdue payment (including any overdue
prepayment) of principal, any overdue payment of interest and any overdue
payment of any Make-Whole Amount or Modified Make-Whole Amount (each as defined
in the Amended and Restated Note Purchase Agreement), payable semiannually as
aforesaid (or, at the option of the registered holder hereof, on demand), at a
rate per annum from time to time
equal to the greater of (i) (A) 10.06% prior to the Effective Date, (B) 11.31%
on and after the Effective Date but prior to and including the Normalization
Date, and (C) 11.06% after the Normalization Date or (ii) 2.00% over the rate
of interest publicly announced by Citibank, N.A. from time to time in New York,
New York, as its “base” or “prime” rate.


 


Payments of
principal of, interest on and any Make-Whole Amount or Modified Make-Whole
Amount with respect to this Note are to be made in lawful money of the United
States of America at the office of HSBC Bank USA, New York in New York, New
York or at such other place as the Company shall have designated by written
notice to


 


1

















 


the holder of this Note as provided in the Amended and Restated Note
Purchase Agreement.


 


This Note is
one of the Amended and Restated Series B Senior Notes due November 23, 2009
(herein called the “Notes”) issued
pursuant to separate Note Purchase Agreements, dated November 23, 1999 as
amended and restated pursuant to an Amended and Restated Note Purchase
Agreement, dated March 11, 2003 (as from time to time amended, the “Amended and Restated Note Purchase Agreement”),
between the Company and the respective holders of the Notes (amongst others)
listed in Schedule A thereto and is entitled to the benefits thereof. Each
holder of this Note will be deemed, by its acceptance hereof, (i) to have
agreed to the confidentiality provisions set forth in Section 20 of the Amended
and Restated Note Purchase Agreement and (ii) to have made the representation
set forth in Section 6 of the Amended and Restated Note Purchase Agreement.


 


This Note is a
registered Note and, as provided in the Amended and Restated Note Purchase
Agreement, upon surrender of this Note for registration of transfer, duly
endorsed, or accompanied by a written instrument of transfer duly executed, by
the registered holder hereof or such holder’s attorney duly authorized in
writing, a new Note for a like principal amount will be issued to, and
registered in the name of, the transferee. Prior to due presentment for
registration of transfer, the Company may treat the person in whose name this
Note is registered as the owner hereof for the purpose of receiving payment and
for all other purposes, and the Company will not be affected by any notice to
the contrary.


 


This Note is
subject to optional prepayment, in whole or from time to time in part, and
subject to mandatory prepayment in certain circumstances, each at the times and
on the terms specified in the Amended and Restated Note Purchase Agreement, but
not otherwise.


 


If an Event of
Default, as defined in the Amended and Restated Note Purchase Agreement, occurs
and is continuing, the principal of this Note may be declared or otherwise
become due and payable in the manner, at the price (including any applicable
Make-Whole Amount) and with the effect provided in the Amended and Restated
Note Purchase Agreement.


 


THIS NOTE SHALL BE CONSTRUED AND ENFORCED IN
ACCORDANCE WITH, AND THE RIGHTS OF THE COMPANY AND THE HOLDER HEREOF SHALL BE
GOVERNED BY, THE LAW OF THE STATE OF NEW YORK EXCLUDING CHOICE-OF-LAW
PRINCIPLES OF THE LAW OF SUCH STATE THAT WOULD REQUIRE THE APPLICATION OF THE
LAWS OF A JURISDICTION OTHER THAN SUCH STATE.


 


	
   

  	
  SPIRENT plc

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  



 


2

















 


EXHIBIT
2.1(c)


 


FORM OF AMENDED AND RESTATED SERIES C NOTE 


 


SPIRENT plc


 


AMENDED AND RESTATED SERIES C SENIOR NOTE DUE
NOVEMBER 23, 2009


 


	
  No. RC-[         ]

  	
   

  	
  [DATE]

  
	
  US$[           ]

  	
   

  	
  PPN: 103084 A#6

  



 


FOR VALUE RECEIVED,
the undersigned, SPIRENT plc
(formerly known as Bowthorpe plc herein and called the “Company”), a limited company organized and
existing under the laws of England and Wales with registered number 470893,
hereby promises to pay to [                     ],
or registered assigns, the principal sum of [                      ]
US DOLLARS (US$[               ])
on November 23, 2009, with interest (computed on the basis of a 360-day year of
twelve 30-day months) (a) on the unpaid balance thereof at the rate of (i)
8.16% per annum prior to the
Effective Date (as defined in the Amended and Restated Note Purchase Agreement,
as hereinafter defined), payable semiannually, on the 23rd day of November and
May in each year until the principal hereof shall have become due and payable
or until the Effective Date, whichever occurs first, (ii) 9.41% per annum on and after the Effective Date,
payable semiannually, on the 23rd day of November and May in each year,
commencing with the November 23 or May 23 next succeeding the Effective Date,
until the principal hereof shall have become due and payable or prior to and
including the Normalization Date (as defined in the Amended and Restated Note
Purchase Agreement), whichever occurs first; and (iii) 9.16% per annum after the Normalization Date,
payable semiannually, on the 23rd day of November and May in each year,
commencing with the November 23 or May 23 next succeeding the Normalization
Date, until the principal hereof shall have become due and payable and (b) to
the extent permitted by law on any overdue payment (including any overdue
prepayment) of principal, any overdue payment of interest and any overdue
payment of any Make-Whole Amount or Modified Make-Whole Amount (each as defined
in the Amended and Restated Note Purchase Agreement), payable semiannually as
aforesaid (or, at the option of the registered holder hereof, on demand), at a
rate per annum from time to time
equal to the greater of (i) (A) 10.16% prior to the Effective Date, (B) 11.41%
on and after the Effective Date but prior to and including the Normalization
Date, and (C) 11.16% after the Normalization Date or (ii) 2.00% over the rate
of interest publicly announced by Citibank, N.A. from time to time in New York,
New York as its “base” or “prime” rate.


 


Payments of
principal of, interest on and any Make-Whole Amount or Modified Make-Whole
Amount with respect to this Note are to be made in lawful money of the United
States of America at the office of HSBC Bank USA, New York in New York, New
York or at such other place as the Company shall have designated by written
notice to the holder of this Note as provided in the Amended and Restated Note
Purchase Agreement.


 


1

















 


This Note is
one of the Amended and Restated Series C Senior Notes due November 23, 2009
(herein called the “Notes”) issued
pursuant to separate Note Purchase Agreements, dated November 23, 1999 as
amended and restated pursuant to an Amended and Restated Note Purchase
Agreement, dated March 11, 2003 (as from time to time amended, the “Amended and Restated Note Purchase Agreement”),
between the Company and the respective holders of the Notes (amongst others)
listed in Schedule A thereto and is entitled to the benefits thereof. Each
holder of this Note will be deemed, by its acceptance hereof, (i) to have
agreed to the confidentiality provisions set forth in Section 20 of the Amended
and Restated Note Purchase Agreement and (ii) to have made the representation
set forth in Section 6 of the Amended and Restated Note Purchase Agreement.


 


This Note is a
registered Note and, as provided in the Amended and Restated Note Purchase
Agreement, upon surrender of this Note for registration of transfer, duly
endorsed, or accompanied by a written instrument of transfer duly executed, by
the registered holder hereof or such holder’s attorney duly authorized in
writing, a new Note for a like principal amount will be issued to, and
registered in the name of, the transferee. Prior to due presentment for
registration of transfer, the Company may treat the person in whose name this
Note is registered as the owner hereof for the purpose of receiving payment and
for all other purposes, and the Company will not be affected by any notice to
the contrary.


 


This Note is
subject to optional prepayment, in whole or from time to time in part, and
subject to mandatory prepayment in certain circumstances, each at the times and
on the terms specified in the Amended and Restated Note Purchase Agreement, but
not otherwise.


 


If an Event of
Default, as defined in the Amended and Restated Note Purchase Agreement, occurs
and is continuing, the principal of this Note may be declared or otherwise
become due and payable in the manner, at the price (including any applicable
Make-Whole Amount) and with the effect provided in the Amended and Restated
Note Purchase Agreement.


 


THIS NOTE SHALL BE CONSTRUED AND ENFORCED IN
ACCORDANCE WITH, AND THE RIGHTS OF THE COMPANY AND THE HOLDER HEREOF SHALL BE
GOVERNED BY, THE LAW OF THE STATE OF NEW YORK EXCLUDING CHOICE-OF-LAW
PRINCIPLES OF THE LAW OF SUCH STATE THAT WOULD REQUIRE THE APPLICATION OF THE
LAWS OF A JURISDICTION OTHER THAN SUCH STATE.


 


	
   

  	
  SPIRENT plc

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  



 


2

















 


EXHIBIT 2.1(d)


 


FORM OF AMENDED AND RESTATED SERIES D NOTE


 


SPIRENT plc


 


AMENDED AND RESTATED SERIES D SENIOR NOTE DUE
NOVEMBER 23, 2009


 


	
  No.
  RD-[             ]

  	
   

  	
  [DATE]

  
	
  US$[              ]

  	
   

  	
  PPN: 103084 B*9

  



 


FOR VALUE RECEIVED,
the undersigned, SPIRENT plc
(formerly known as Bowthorpe plc herein and called the “Company”), a limited company organized and
existing under the laws of England and Wales with registered number 470893,
hereby promises to pay to [                      ],
or registered assigns, the principal sum of [                    ]
US DOLLARS
(US$[                   ])
on November 23, 2009, with interest (computed on the basis of a 360-day year of
twelve 30-day months)  (a) on the unpaid
balance thereof at (i) 8.75% per annum
prior to the Effective Date (as defined in the Amended and Restated Note
Purchase Agreement, as hereinafter defined), payable semiannually, on the 23rd
day of November and May in each year until the principal hereof shall have
become due and payable or until the Effective Date, whichever occurs first,
(ii) 10.00% per annum on and
after the Effective Date, payable semiannually, on the 23rd day of November and
May in each year, commencing with the November 23 or May 23 next succeeding the
Effective Date, until the principal hereof shall have become due and payable or
prior to and including the Normalization Date (as defined in the Amended and
Restated Note Purchase Agreement), whichever occurs first, and (iii) 9.75% per annum after the Normalization Date,
payable semiannually, on the 23rd day of November and May in each year,
commencing with the November 23 or May 23 next succeeding the Normalization
Date, until the principal hereof shall have become due and payable and (b) to
the extent permitted by law on any overdue payment (including any overdue
prepayment) of principal, any overdue payment of interest and any overdue
payment of any Make-Whole Amount or Modified Make-Whole Amount (each as defined
in the Amended and Restated Note Purchase Agreement), payable semiannually as
aforesaid (or, at the option of the registered holder hereof, on demand), at a
rate per annum from time to time
equal to the greater of (i) (A) 10.75% prior to the Effective Date, (B) 12.00%
on and after the Effective Date but prior to and including the Normalization
Date, and (C) 11.75% after the Normalization Date or (ii) 2.00% over the rate
of interest publicly announced by Citibank, N.A. from time to time in New York,
New York as its “base” or “prime” rate.


 


Payments of
principal of, interest on and any Make-Whole Amount or Modified Make-Whole
Amount with respect to this Note are to be made in lawful money of the United
States of America at the office of HSBC Bank USA, New York in
New York, New York or at such other place as the Company shall have
designated by written notice to the holder of this Note as provided in the
Amended and Restated Note Purchase Agreement.


 


1

















 


This Note is
one of the Amended and Restated Series D Senior Notes due November 23, 2009
(herein called the “Notes”) issued
pursuant to separate Note Purchase Agreements, dated November 23, 1999 as amended
and restated pursuant to an Amended and Restated Note Purchase Agreement, dated
March 11, 2003 (as from time to time amended, the “Amended and Restated Note Purchase Agreement”), between the
Company and the respective holders of the Notes (amongst others) listed in
Schedule A thereto and is entitled to the benefits thereof. Each holder of this
Note will be deemed, by its acceptance hereof, (i) to have agreed to the
confidentiality provisions set forth in Section 20 of the Amended and Restated
Note Purchase Agreement and (ii) to have made the representation set forth in
Section 6 of the Amended and Restated Note Purchase Agreement.


 


This Note is a
registered Note and, as provided in the Amended and Restated Note Purchase
Agreement, upon surrender of this Note for registration of transfer, duly
endorsed, or accompanied by a written instrument of transfer duly executed, by
the registered holder hereof or such holder’s attorney duly authorized in
writing, a new Note for a like principal amount will be issued to, and
registered in the name of, the transferee. Prior to due presentment for
registration of transfer, the Company may treat the person in whose name this
Note is registered as the owner hereof for the purpose of receiving payment and
for all other purposes, and the Company will not be affected by any notice to
the contrary.


 


This Note is
subject to optional prepayment, in whole or from time to time in part, and
subject to mandatory prepayment in certain circumstances, each at the times and
on the terms specified in the Amended and Restated Note Purchase Agreement, but
not otherwise.


 


If an Event of
Default, as defined in the Amended and Restated Note Purchase Agreement, occurs
and is continuing, the principal of this Note may be declared or otherwise
become due and payable in the manner, at the price (including any applicable
Make-Whole Amount) and with the effect provided in the Amended and Restated
Note Purchase Agreement.


 


THIS NOTE SHALL BE CONSTRUED AND ENFORCED IN
ACCORDANCE WITH, AND THE RIGHTS OF THE COMPANY AND THE HOLDER HEREOF SHALL BE
GOVERNED BY, THE LAW OF THE STATE OF NEW YORK EXCLUDING CHOICE-OF-LAW
PRINCIPLES OF THE LAW OF SUCH STATE THAT WOULD REQUIRE THE APPLICATION OF THE
LAWS OF A JURISDICTION OTHER THAN SUCH STATE.


 


	
   

  	
  SPIRENT plc

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  



 


2

















 


EXHIBIT
4.5


 


PART A


 


FORM OF SUBSIDIARY GUARANTEE (U.S. ENTITY)


 

















 


Exhibit 4.5


Part A


(US Entity)


 


[FORM OF SUBSIDIARY GUARANTEE]


 


GUARANTEE AGREEMENT


 


GUARANTEE AGREEMENT, dated
[                              ,
                        ],
by
[                                   ],
a corporation/limited company organized and existing under the laws of
[                                   ]
(the “Guarantor”, which expression
shall include its successors and assigns), in favor of each of the holders of
the Notes (as such terms are defined below).


 


PRELIMINARY STATEMENTS:


 


A.                                    SPIRENT plc (formerly known as Bowthorpe plc), a limited
company organized and existing under the laws of England and Wales with
registered number 470893 (together with its successors and assigns, the  “Company”),
entered into those certain separate Note Purchase Agreements each dated
November 23, 1999 (as amended on November 14, 2000 and as further amended and
restated on March •, 2003 and as
may be further amended or varied from time to time in accordance with the terms
thereof, the “Amended and Restated Note
Purchase Agreement”), with each of the purchasers named on
Schedule A thereto (such purchasers, together with their respective transferees
and assignees, being referred to herein, individually, as a “Noteholder”, and,
collectively, as the “Noteholders”)
pursuant to which the Company issued and sold to the Noteholders (a)
US$10,000,000 principal amount of its 7.94% Senior A Senior Notes due November
23, 2006 (including any amendments, restatements or modifications from time to
time, the “Series A Notes”, such term
to include any such notes issued in substitution therefore pursuant to Section • of the Amended and Restated Note Purchase
Agreement), (b) US$63,406,000 principal amount of its 8.06% Series B Senior
Notes due November 23, 2009 (including any amendments, restatements or
modifications from time to time, the “Series B
Notes”, such term to include any such notes issued in
substitution therefore pursuant to Section of the Amended and Restated Note
Purchase Agreement), (c) US$115,000,000 principal amount of its 8.16% Series C
Senior Notes due November 23, 2009 (including any amendments, restatements or
modifications from time to time, the “Series C
Notes”, such term to include any such notes issued in
substitution therefore pursuant to Section • of the Amended and Restated Note Purchase
Agreement) and (d) US$29,594,000 principal amount of its Fixed Rate Series D
Senior Notes due November 23, 2009 (including any amendments, restatements or
modifications from time to time, the “Series D
Notes”, such term to include any such notes issued in
substitution therefore pursuant to Section • of the Amended and Restated Note Purchase
Agreement) (the


 

















 


Series A Notes, the Series B
Notes, the Series C Notes and the Series D Notes are referred to herein,
collectively, as the “Notes”).


 


B.                                    By agreeing to enter into this Agreement, the
Guarantor acknowledges that:


 


(a)                                  it will directly or indirectly gain
substantial financial and other benefits;


 


(b)                                 those benefits will constitute reasonably
equivalent value and fair consideration for the purpose of any applicable
United States bankruptcy or State fraudulent transfer or conveyance statute and
any related case law; and


 


(c)                                  each holder has acted in good faith in
connection with this Guarantee and the Restructuring Transaction.


 


NOW THEREFORE, in consideration of the foregoing and other good and valuable
consideration, the receipt of which is hereby acknowledged, the Guarantor does
hereby covenant and agree, for the benefit of all present and future holders,
from time to time, of the Notes as follows:


 


AGREEMENT:


 


1.                                      GUARANTEE.


 


1.1.                            Guaranteed Obligations.


 


The
Guarantor, in consideration of the execution and delivery of the Amended and
Restated Note Purchase Agreement, hereby unconditionally, absolutely, jointly
and severally guarantees, on a continuing basis, to each holder as and for the
Guarantor’s own debt, until final and indefeasible payment has been made the
due and punctual payment by the Company of the principal of, and interest
(including interest after the commencement of any bankruptcy proceeding by or
against the Company), Make-Whole Amount and Modified Make-Whole Amount (if any)
on, the Notes at any time outstanding and the due and punctual payment of all
other amounts payable (including, without limitation, Additional Payments) by
the Company to the holders under the Amended and Restated Note Purchase
Agreement and the Notes, in each case when and as the same shall become due and
payable, whether at maturity, pursuant to mandatory or optional prepayment, by
acceleration or otherwise, all in accordance with the terms and provisions
hereof and thereof; it being the intent of the Guarantor that the guarantee set
forth herein shall be a continuing guarantee of payment and not merely a
guarantee of collection.  All of the
obligations set forth in this Section 1.1 are referred to herein as the “Guaranteed Obligations” and the Guarantee
thereof set forth in this Section 1 is referred to herein as the “Unconditional Guarantee”.


 


2

















 


1.2.                            Payments.


 


In the event that the Company fails to make, on or before the due date
thereof, any payment to be made of any principal amount of, or interest,
Make-Whole Amount or Modified Make-Whole Amount on, or in respect of, the Notes
or of any other amounts due to any holder under the Notes or the Amended and
Restated Note Purchase Agreement (including, without limitation, Additional
Payments), after in each case giving effect to any applicable grace periods or
cure provisions or waivers or amendments, the Guarantor shall cause forthwith
to be paid the moneys, or to be performed, kept, observed, or fulfilled each of
such obligations, in respect of which such failure has occurred in accordance
with the terms and provisions of the Amended and Restated Note Purchase
Agreement and the Notes.  In furtherance
of the foregoing, if an Event of Default shall exist, all of the Guaranteed
Obligations shall, in the manner and subject to the limitations provided in the
Amended and Restated Note Purchase Agreement for the acceleration of the Notes
(including, without limitation, the provisions related to the annulment
thereof), forthwith become due and payable without notice, regardless of
whether the acceleration of the Notes shall be stayed, enjoined, delayed or
otherwise prevented.


 


Nothing shall discharge or satisfy the obligations of the Guarantor
hereunder except the full and final performance and indefeasible payment of the
Guaranteed Obligations.


 


1.3.                            Joint and Several Liability.


 


The
Guarantor acknowledges and agrees that its liabilities and the liabilities of
each of the other Subsidiary Guarantors under their respective Subsidiary
Guarantees for the due and punctual payment of the Guaranteed Obligations shall
be joint and several.


 


1.4.                            Releases.


 


The Guarantor consents and agrees that, without any notice whatsoever
to or by the Guarantor and without impairing, releasing, abating, deferring,
suspending, reducing, terminating or otherwise affecting the obligations of the
Guarantor hereunder, each holder, by action or inaction, may:


 


(a)                                  compromise or settle,
renew or extend the period of duration or the time for the payment, or
discharge the performance of, or may refuse to, or otherwise not, enforce, or
may, by action or inaction, release all or any one or more parties to, any one
or more of the Notes, the Amended and Restated Note Purchase Agreement, any
other Subsidiary Guarantee, any other guarantee or agreement or instrument
related thereto or hereto;


 


(b)                                 assign, sell or transfer, or otherwise
dispose of, any one or more of the Notes;


 


3

















 


(c)                                  grant waivers,
extensions, consents and other indulgences of any kind whatsoever to the
Company or any other Person liable in any manner in respect of all or any part
of the Guaranteed Obligations;


 


(d)                                 amend, modify or
supplement in any manner whatsoever and at any time (or from time to time) any
one or more of the Notes, the Amended and Restated Note Purchase Agreement, any
other Subsidiary Guarantee, any other guarantee or any agreement or instrument
related thereto or hereto;


 


(e)                                  release or substitute
any one or more of the endorsers or guarantors of the Guaranteed Obligations
whether parties hereto or not; and


 


(f)                                    sell, exchange,
release, accept, surrender or enforce rights in, or fail to obtain or perfect
or to maintain, or caused to be obtained, perfected or maintained, the
perfection of  any security
interest, charge or other Lien on, by action or inaction, any property at any
time pledged or granted as security in respect of the Guaranteed Obligations,
whether so pledged or granted by the Company, the Guarantor or any other
Person.


 


The Guarantor hereby ratifies and confirms any such action specified in
this Section 1.4 and agrees that the same shall be binding upon the
Guarantor.  The Guarantor hereby waives
any and all defenses, counterclaims or offsets which the Guarantor might or
could have by reason thereof.


 


1.5.                            Waivers.


 


To the fullest extent permitted by law, the Guarantor hereby waives:


 


(a)                                  notice of acceptance
of this Agreement;


 


(b)                                 notice of any purchase
or acceptance of the Notes under the Amended and Restated Note Purchase
Agreement, or the creation, existence or acquisition of any of the Guaranteed
Obligations, subject to the Guarantor’s right to make inquiry of each holder to
ascertain the amount of the Guaranteed Obligations at any reasonable time;


 


(c)                                  notice of the amount
of the Guaranteed Obligations, subject to the Guarantor’s right to make inquiry
of each holder to ascertain the amount of the Guaranteed Obligations at any
reasonable time;


 


(d)                                 notice of adverse
change in the financial condition of the Company, any of the other Subsidiary
Guarantors or any other guarantor or any other fact that might increase the
Guarantor’s risk hereunder;


 


(e)                                  notice of presentment
for payment, demand, protest, and notice thereof as to the Notes or any other
instrument;


 


4

















 


(f)                                    notice of any Default or Event of Default;


 


(g)                                 all other notices and demands to which the
Guarantor might otherwise be entitled (except if such notice or demand is
specifically otherwise required to be given to the Guarantor under this
Agreement);


 


(h)                                 the right by statute
or otherwise to require any or each holder to institute suit against the
Company, any other Subsidiary Guarantor or any other guarantor or to exhaust
the rights and remedies of any or each holder against the Company, the other
Subsidiary Guarantors or any other guarantor, the Guarantor being bound to the
payment of each and all Guaranteed Obligations, whether now existing or
hereafter accruing, as fully as if such Guaranteed Obligations were directly
owing to each holder by the Guarantor;


 


(i)                                     any defense
arising by reason of any disability or other defense (other than the defense
that the Guaranteed Obligations shall have been fully and finally performed and
indefeasibly paid) of the Company or by reason of the cessation from any cause
whatsoever of the liability of the Company in respect thereof;


 


(j)                                     any stay (except
in connection with a pending appeal), valuation, appraisal, redemption or
extension law now or at any time hereafter in force that, but for this waiver,
might be applicable to any sale of property of the Guarantor made under any
judgment, order or decree based on this Agreement, and the Guarantor covenants
that it will not at any time insist upon or plead, or in any manner claim or
take the benefit or advantage of any such law; and


 


(k)                                  at all times prior to
the full and final performance and indefeasible payment of the Guaranteed
Obligations, any claim of any nature arising out of any right of indemnity,
contribution, reimbursement, indemnification or any similar right or any claim
of subrogation (whether such right or claim arises under contract, common law
or statutory or civil law (including, without limitation, Section 509 of the US
Bankruptcy Code)) arising in respect of any payment made under this Agreement
or in connection with this Agreement, against the Company or the estate of the
Company (including Liens on the property of the Company or the estate of the
Company), in each case whether or not the Company at any time shall be the
subject of any proceeding brought under any Insolvency Law, and the Guarantor
further agrees that it will not file any claims against the Company or the
estate of the Company in the course of any such proceeding or otherwise, and
further agrees that each holder may specifically enforce the provisions of this
clause (k).


 


1.6.                            Marshaling.


 


The
Guarantor consents and agrees:


 


5

















 


(a)                                  that each holder, and each Person acting for
the benefit of one or more of the holders, shall be under no obligation to
marshal any assets in favor of the Guarantor or against or in payment of any or
all of the Guaranteed Obligations; and


 


(b)                                 that, to the extent that the Company, any
other Subsidiary Guarantor or any other guarantor of any of the Guaranteed
Obligations makes a payment or payments to any holder, which payment or
payments or any part thereof are subsequently invalidated, declared to be
fraudulent or preferential, set aside or required, for any of the foregoing
reasons or for any other reason, to be repaid or paid over to a custodian,
trustee, administrator, receiver, administrative receiver, or any other
official or party under any Insolvency Law, other common or civil law, or
equitable cause, then, to the extent of such payment or repayment, the
obligation or part thereof intended to be satisfied thereby shall be revived
and continued in full force and effect as if such payment or payments had not
been made and the Guarantor shall be primarily liable for such obligation.


 


1.7.                            Immediate Liability.


 


The
Guarantor agrees that the liability of the Guarantor in respect of the
Unconditional Guarantee shall be immediate and shall not be contingent upon the
exercise or enforcement by any holder or any other Person of whatever remedies
such holder or other Person may have against the Company, any other Subsidiary
Guarantor, or any other guarantor or the enforcement of any Lien or realization
upon any security such holder or other Person may at any time possess.


 


1.8.                            Primary Obligations.


 


The
Unconditional Guarantee is a primary and original obligation of the Guarantor
and is an absolute, unconditional, continuing guarantee of indefeasible payment
and shall remain in full force and effect without respect to any action by any
holder specified in Section 1.4 or any future changes in conditions, including,
without limitation, change of law or any invalidity or irregularity with
respect to the issuance or assumption of any obligations (including, without
limitation, the Notes) of or by the Company, any other Subsidiary Guarantor, or
any other guarantor, or with respect to the execution and delivery of any
agreement (including, without limitation, the Notes and the Amended and
Restated Note Purchase Agreement) of the Company or any other Person.


 


1.9.                            Additional Security.


 


The
Unconditional Guarantee is in addition to and is not in any way prejudiced by
any other security now or subsequently held by any holder.


 


6

















 


1.10.                     No Reduction or Defense.


 


The obligations of the Guarantor under this Agreement, and the rights
of any holder to enforce such obligations by any proceedings, whether by action
at law, suit in equity or otherwise, shall not be subject to any reduction,
limitation, impairment or termination (except as set forth in Section 1.22),
whether by reason of any claim of any character whatsoever or otherwise,
including, without limitation, claims of waiver, release (except as set forth in
Section 1.22), surrender, alteration or compromise, and shall not be subject to
any defense (other than any defense based upon the irrevocable payment and
performance in full of the obligations of the Company under the Amended and
Restated Note Purchase Agreement and the Notes), set-off, counterclaim,
recoupment or termination whatsoever (except as set forth in Section 1.22).


 


Without limiting the generality of the foregoing, the obligations of
the Guarantor shall not be discharged or impaired by:


 


(a)                                  any default
(including, without limitation, any Default or Event of Default), failure or
delay, willful or otherwise, in the performance of any obligations by the
Guarantor, the Company or any of their respective Subsidiaries or Affiliates;


 


(b)                                 any proceeding of, or
involving, the Company or any of its Subsidiaries under any Insolvency Law, or
any merger, consolidation, amalgamation, reorganization, dissolution,
liquidation, sale of assets or winding up or change in corporate constitution
or corporate identity or loss of corporate identity of the Company or any of
its Subsidiaries or Affiliates;


 


(c)                                  any incapacity or
lack of power, authority or legal personality of, or dissolution or change in
the members or status of, the Company or any of its Subsidiaries or any other
Person;


 


(d)                                 impossibility or
illegality of performance on the part of the Company under the Amended and
Restated Note Purchase Agreement or the Notes or on the part of any other
Subsidiary Guarantor under any other Subsidiary Guarantee;


 


(e)                                  the invalidity,
irregularity or unenforceability of the Notes, the Amended and Restated Note
Purchase Agreement, any other Subsidiary Guarantee, or any documents referred
to therein or herein;


 


(f)                                    in respect of the
Company or any of its Subsidiaries, any change of circumstances, whether or not
foreseen or foreseeable, whether or not imputable to the Company or any such
Subsidiary, or other impossibility of performance through fire, explosion,
accident, labor disturbance, floods, droughts, embargoes, wars (whether or not
declared), terrorist activities, civil commotions, acts of God or the public
enemy, delays or failure of suppliers or carriers, inability to obtain


 


7

















 


materials or any other causes affecting performance, or any other force
majeure, whether or not beyond the control of the Company or such Subsidiary
and whether or not of the kind hereinbefore specified;


 


(g)                                 any attachment, claim,
demand, charge, Lien, order, process, encumbrance or any other happening or
event or reason, similar or dissimilar to the foregoing, or any withholding or
diminution at the source, by reason of any taxes, assessments, expenses,
indebtedness, obligations or liabilities of any character, foreseen or
unforeseen, and whether or not valid, incurred by or against any Person, or any
claims, demands, charges, Liens or encumbrances of any nature, foreseen or
unforeseen, incurred by any Person, or against any sums payable under the
Amended and Restated Note Purchase Agreement, the Notes, this Agreement, or any
other Subsidiary Guarantee, so that such sums would be rendered inadequate or
would be unavailable to make the payments herein provided; or


 


(h)                                 any order, judgment,
decree, ruling or regulation (whether or not valid) of any court of any nation
or of any political subdivision thereof or any Governmental Authority, or any
other action, happening, event or reason whatsoever which shall delay,
interfere with, hinder or prevent, or in any way adversely affect, the
performance by the Company or any other Subsidiary Guarantor of any of their
respective obligations under the Amended and Restated Note Purchase Agreement
or the Notes, or the other Subsidiary Guaranties, as the case may be.


 


1.11.                     No Election.


 


Each holder shall, individually or collectively, have the right to seek
recourse against the Guarantor to the fullest extent provided for herein for
its obligations under this Agreement. 
No election to proceed in one form of action or proceeding, or against
any party, or on any obligation, shall constitute a waiver of such holder’s
right to proceed in any other form of action or proceeding or against other
parties unless such holder has expressly waived such right in writing.  Specifically, but without limiting the
generality of the foregoing, no action or proceeding by or on behalf of any
holder against the Company or any other Person under any document or instrument
evidencing obligations of the Company or such other Person to or for the
benefit of such holder shall serve to diminish the liability of the Guarantor
under this Agreement except to the extent that such holder unconditionally
shall have realized payment by such action or proceeding.


 


1.12.                     Severability.


 


Each of the rights and remedies granted under this Section 1 to each
holder in respect of the Notes held by such holder may be exercised by such
holder without notice to, or the consent of or any other action by, any other
holder.


 


8

















 


1.13.                     Appropriations.


 


Until all amounts which may be or become payable by the Company under
or in connection with the Amended and Restated Note Purchase Agreement or the
Notes, by the Guarantor under or in connection with this Agreement, or by any
other Subsidiary Guarantor under or in connection with any other Subsidiary
Guarantee, have been irrevocably and indefeasibly paid in full, any holder (or
any trustee or agent on its behalf) may:


 


(a)                                  refrain from applying
or enforcing any other moneys, security or rights held or received by such
holder (or any trustee or agent on its behalf) in respect of those amounts, or
apply and enforce the same in such manner and order as it sees fit (whether
against those amounts or otherwise) and the Guarantor shall not be entitled to
the benefit of the same; and


 


(b)                                 hold in a suspense
account any moneys received from the Guarantor, or on account of the
Guarantor’s liability under this Agreement, without liability to pay interest
on those moneys.


 


1.14.                     Other Enforcement Rights.


 


Each holder may proceed to protect and enforce this Agreement by suit
or suits or proceedings in equity, at law or in bankruptcy or insolvency, and
whether for the specific performance of any covenant or agreement contained
herein or in execution or aid of any power herein granted; or for the recovery
of judgment for the obligations hereby guaranteed or for the enforcement of any
other proper, legal or equitable remedy available under applicable law.


 


1.15.                     Invalid Payments.


 


To the extent that any payment is made to any holder in respect of the
Guaranteed Obligations by any Person, which payment or any part thereof is
subsequently invalidated, declared to be fraudulent or preferential, set aside
or required, for any of the foregoing reasons or for any other reason, to be
repaid or paid over to a custodian, trustee, administrator, receiver,
administrative receiver, or any other party or official under any Insolvency
Law, or any other common or civil law or equitable cause, then to the extent of
such payment or repayment, the obligation or part thereof intended to be
satisfied shall be revived and continued in full force and effect as if said
payment had not been made and the Guarantor shall be primarily liable for such
obligation.


 


1.16.                     No Waivers or Election of
Remedies, Expenses, etc.


 


No course of dealing and no delay on the part of any holder of any Note
in exercising any right, power or remedy shall operate as a waiver thereof or
otherwise prejudice such holder’s rights, powers or remedies.  No right, power or remedy conferred by this
Agreement or the Amended and Restated Note Purchase Agreement upon any


 


9

















 


holder shall
be exclusive of any other right, power or remedy referred to herein or therein
or now or hereafter available at law, in equity, by statute or otherwise.  Without limiting the obligations of the
Company under Section [•] of the Amended and Restated Note
Purchase Agreement, the Guarantor will pay to the holder of each Note on demand
all amounts specified in Section [•]
of the Amended and Restated Note Purchase Agreement and such further amount as
shall be sufficient to cover all reasonable costs and expenses of such holder
incurred in any enforcement or collection under this Agreement, including,
without limitation, reasonable attorneys’, solicitors’ and barristers’ fees,
expenses and disbursements.


 


1.17.                     Restoration of Rights and
Remedies.


 


If any holder shall have instituted any proceeding to enforce any right
or remedy under this Agreement, the Amended and Restated Note Purchase
Agreement or any Note held by such holder and such proceeding shall have been
discontinued or abandoned for any reason, or shall have been determined
adversely to such holder, then and in every such case each such holder, the
Company and the Guarantor shall, except as may be limited or affected by any
determination in such proceeding, be restored severally and respectively to its
respective former position hereunder and thereunder, and thereafter the rights
and remedies of such holder shall continue as though no such proceeding had
been instituted.


 


1.18.                     Payment and Withholding.


 


All sums due and payable by the Guarantor under this Agreement shall be
made in full and without setoff or counterclaim and free and clear of and
without deduction for or on account of any future or present Tax.  If:


 


(a)                                  the Guarantor is
required by law to make any deduction or withholding from any sum payable by
the Guarantor to a holder hereunder, or


 


(b)                                 a holder is required
by law to make any payment, on account of any Tax or otherwise on or in
relation to any amount received or receivable by such holder hereunder,


 


then the sum payable by the Guarantor in respect of which such
deduction, withholding or payment is required to be made shall be increased to
the extent necessary to ensure that, after the making of such deduction,
withholding or payment (and after taking account of any deduction, withholding
or payment which is required to be made as a result of the increase), such
holder receives and retains a net sum equal to the sum which it would have
received and so retained had no such deduction, withholding or payment been
made; provided that each holder will comply with any reasonable request of the
Guarantor to comply with any form filing or similar reporting requirement to
reduce such deduction, withholding or payment within 60 days of the Guarantor
providing written notice to the holder of such filing or similar reporting
requirement, so long as any required forms and accompanying instructions issued
by the relevant taxing


 


10

















 


authority are
provided to the holder along with such written notice.  The foregoing notwithstanding, nothing in
this Section 1.18 shall (i) restrict the right of any holder to arrange its tax
affairs as it shall think fit, (ii) require any holder to disclose any
information regarding its tax affairs which, in such holder’s reasonable and
good faith judgment, constitutes confidential or proprietary information, or
(iii) subject to the paragraph below, require any holder to account for any
indirect taxation benefits arising from the deduction, withholding or payment
of any Tax.  The obligations of the
Guarantor and the holders under this Section 1.18 will survive the payment or
transfer of any Note and the termination of this Agreement.


 


Each holder agrees that, with reasonable promptness after receiving
written notice from the Guarantor to the effect that such holder is eligible
for a refund in respect of Taxes actually paid by the Guarantor, such holder
will sign and deliver to or as reasonably directed by the Guarantor any Form
provided to such holder by the Guarantor to enable such holder to obtain a
refund in respect of such Taxes; and if such holder thereafter receives such
refund in respect of such Taxes, such holder will promptly pay such refund to
the Guarantor (together with interest, if any, received by such holder from the
relevant taxing authority).  If a holder
applies for a refund of such Taxes prior to a request by the Guarantor to apply
for such a refund, upon receipt of a request by the Guarantor to apply for a
refund or to turn over the proceeds of any such refund, the holder will pay any
such refund to the Guarantor (together with interest, if any, received by such
holder from the relevant taxing authority) promptly upon receipt of such
refund, or if later, promptly upon receipt of the request from the
Guarantor.  The Guarantor agrees to pay
all reasonable out-of-pocket expenses incurred by a holder in connection with
obtaining such refund.


 


1.19.                     Limitation on Guaranteed
Obligations.


 


It is the intention of the Guarantor and each holder of Notes that the
maximum amount of the obligations of the Guarantor hereunder shall be equal to,
but not in excess of, the maximum amount permitted by applicable law.  To that end, with respect to the
determination of the “maximum
amount permitted by applicable law,”
but only to the extent such obligations would otherwise be avoidable, the
obligations of the Guarantor hereunder shall be limited to the maximum amount
that the Guarantor is permitted to pay in respect of the Guaranteed Obligations
under any applicable Insolvency Law (including, without limitation, if
applicable, the US Bankruptcy Code).  Any
such limitation shall be apportioned amongst the Guaranteed Obligations owed to
the holders pro rata.  This Section 1.19
is intended solely to preserve the rights of each holder hereunder to the
maximum extent permitted by applicable law, and neither the Guarantor nor any
other Person shall have any rights under this Section 1.19 that it would not
otherwise have under applicable law.


 


11

















 


1.20.                     Further Assurances.


 


The Guarantor will cooperate with the holders and execute such further
instruments and documents as the Required Holders shall reasonably request to
carry out, to the reasonable satisfaction of the Required Holders, the
transactions contemplated by the Amended and Restated Note Purchase Agreement,
the Notes, this Agreement and the documents and instruments related thereto.


 


1.21.                     Survival.


 


So long as the Guaranteed Obligations shall not have been fully and
finally performed and indefeasibly paid, the obligations of the Guarantor under
the Unconditional Guarantee shall survive the transfer and payment of any Note
and the payment in full of all the Notes.


 


1.22.                     Termination.


 


Notwithstanding anything to the contrary herein, this Agreement may be
terminated and all obligations of the Guarantor hereunder shall be
automatically terminated upon notice from the Company and satisfaction of the
other conditions contained in Section [•] of the Amended and Restated Note
Purchase Agreement.


 


2.                                      REPRESENTATIONS AND
WARRANTIES OF THE GUARANTOR.


 


2.1.                            Representations and
Warranties in Amended and Restated Note Purchase Agreement.


 


Without in any way limiting the generality of the warranties and
representations contained in Section 5 of the Amended and Restated Note
Purchase Agreement, each of such warranties and representations is, insofar as
it refers to a Subsidiary or a Guarantor specifically or to any Subsidiary
generally, true and correct, as of the date hereof, with respect to the
Guarantor.


 


2.2.                            Warranties and
Representations with Respect to the Guarantor and this Agreement.


 


(a)                                  Organization; Power and Authority.  The Guarantor is a corporation
duly organized and validly existing under the laws of its jurisdiction of
incorporation, and (to the extent such concept is recognized in such
jurisdiction) in good standing under the laws of its jurisdiction of
incorporation, and is duly qualified as a foreign corporation and (to the
extent such concept is recognized in such jurisdictions) is in good standing in
each jurisdiction in which such qualification is required by law, other than
those jurisdictions as to which the failure to be so qualified or in good
standing could not, individually or in the aggregate, reasonably be expected to
have a Material Adverse Effect.  The
Guarantor has the corporate power and authority to own or hold under lease the


 


12

















 


properties it purports to own or hold under lease, to transact the
business it transacts and proposes to transact, to execute and deliver this
Agreement, and to perform the provisions hereof.


 


(b)                                 Authorization, etc. 
This Agreement has been duly authorized by all necessary
corporate action on the part of the Guarantor, and this Agreement constitutes a
legal, valid and binding obligation of the Guarantor enforceable against the
Guarantor in accordance with its terms, except as such enforceability may be
limited by (a) applicable bankruptcy, insolvency, reorganization, moratorium,
or other similar laws affecting the enforcement of creditors’ rights generally
and (b) general principles of equity (regardless of whether such enforceability
is considered in a proceeding in equity or law).


 


(c)                                  Compliance with Laws, Other Instruments, etc.  The execution, delivery and
performance by the Guarantor of this Agreement will not


 


(i)                                     contravene, result
in any breach of, or constitute a default under, or result in the creation of
any Lien in respect of any property of the Guarantor under, any indenture,
mortgage, deed of trust, loan, purchase or credit agreement, lease, memorandum
or articles of association, corporate charter or by-laws, or any other
agreement, instrument or license to which the Guarantor is bound or subject or
by which the Guarantor or any of its properties may be bound or affected,


 


(ii)                                  conflict with or
result in a breach of any of the terms, conditions or provisions of any order,
judgment, decree, or ruling of any court, arbitrator or Governmental Authority
applicable to the Guarantor, or


 


(iii)                               violate any provision of
any applicable law or other rule or regulation of any Governmental Authority applicable
to the Guarantor.


 


(d)                                 Governmental Authorizations, etc.  No consent, approval or
authorization of, or registration, filing or declaration with, any Governmental
Authority is required in connection with the execution, delivery or performance
by the Guarantor of this Agreement.


 


(e)                                  Pari
Passu Ranking.  The Guarantor’s
obligations under this Agreement will rank at least pari passu, without
preference or priority, with all of its other outstanding obligations in
respect of its senior, unsecured and unsubordinated Financial Indebtedness,
except for those obligations that are mandatorily preferred by law and not by
reason of contract.


 


(f)                                    Solvency of Guarantor.  The fair value of the business and assets of the
Guarantor will be in excess of the amount that will be required to pay the
total liabilities of the Guarantor, in each case after giving effect to this
Agreement.  The Guarantor, after giving
effect to this Agreement, will:


 


13

















 


(i)                                     not be “insolvent” (as such term is defined in the
US Bankruptcy Code),


 


(ii)                                  not be unable to pay
its debts (within the meaning of Section 123(1)(a) or (c) or Section 123(2) of
the Insolvency Act), or


 


(iii)                               not be engaged in any
business or transaction, or about to engage in any business or transaction, for
which the Guarantor has an unreasonably small capital, and the Guarantor has no
intent to:


 


(A)                              hinder, delay or defraud
any entity to which it is, or will become, on or after the date hereof,
indebted, or


 


(B)                                incur debts that would
be beyond its ability to pay as they mature; or


 


(iv)                              not
have made a transfer or incurred any obligation under a Financing Document with
the intent to hinder, delay or defraud any of its present or future creditors.


 


3.                                      COVENANTS.


 


3.1.                            Covenants in Amended and
Restated Note Purchase Agreement.


 


The Guarantor will comply with each of the provisions of Section [•] and Section [•] of the Amended and
Restated Note Purchase Agreement, and each other covenant and agreement
contained therein, that is applicable to a Subsidiary or a Guarantor
specifically or to any Subsidiary generally.


 


3.2.                            Pari Passu Ranking.


 


The Guarantor shall procure that its obligations under this Agreement
will at all times rank at least pari passu, without preference or priority,
with all of its other outstanding obligations in respect of its senior,
unsecured and unsubordinated Financial Indebtedness, except for those
obligations that are mandatorily preferred by law and not by reason of
contract.


 


4.                                      PAYMENTS ON NOTES.


 


4.1.                            Place and Manner of Payment.


 


The Guarantor will make all payments in respect hereof to the holders
at the place and in the manner specified in Section [•] of the Amended and
Restated Note Purchase Agreement.


 


14

















 


4.2.                            Currency
of Payment.


 


All payments under this Agreement shall be made in US Dollars.  To the fullest extent permitted by
applicable law, the obligation of the Guarantor in respect of any amount due
under or in respect of this Agreement, notwithstanding any payment in any
currency other than US Dollars, whether as a result of (i) any judgment or
order or the enforcement thereof, (ii) the realization on any security, (iii)
the liquidation of the Guarantor, (iv) any voluntary payment by the Guarantor
or (v) any other reason, shall be discharged only to the extent of the amount
in US Dollars that each holder entitled to receive such payment may, in
accordance with normal banking procedures, purchase in the foreign exchange
markets in London, England with the sum paid in such other currency (after any
premium and costs of exchange) on the Business Day immediately following the
day on which such holder receives such payment and if the amount in US Dollars
that may be so purchased for any reason is less than the amount originally due,
the Guarantor shall indemnify and save harmless such holder from and against
all loss or damage arising out of or as a result of such deficiency.  This indemnity shall constitute an
obligation separate and independent from the other obligations contained in
this Agreement, shall give rise to a separate and independent cause of action,
shall apply irrespective of any indulgence granted by such holder from time to
time and shall continue in full force and effect notwithstanding any judgment
or order for a liquidated sum in respect of an amount due under this Agreement,
the Amended and Restated Note Purchase Agreement or under any judgment or
order.


 


5.                                      SURVIVAL
OF REPRESENTATIONS AND WARRANTIES; ENTIRE AGREEMENT.


 


All representations and warranties contained herein shall survive the
execution and delivery of this Agreement, the purchase or transfer by any
Noteholder of any Note or portion thereof or interest therein and the payment
of any Note, and may be relied upon by any subsequent holder of a Note,
regardless of any investigation made at any time by or on behalf of any
Noteholder or any other holder of a Note. 
All statements contained in any certificate or other instrument
delivered by or on behalf of the Guarantor pursuant to this Agreement or the
Amended and Restated Note Purchase Agreement shall be deemed representations
and warranties of the Guarantor under this Agreement.  Subject to the preceding sentence, this Agreement embodies the
entire agreement and understanding between the Noteholders and the Guarantor
and supersedes all prior agreements and understandings relating to the subject
matter hereof.


 


6.                                      AMENDMENT
AND WAIVER.


 


6.1.                            Requirements.


 


This Agreement may be amended, and the observance of any term hereof
may be waived (either retroactively or prospectively), with (and only with) the
written consent of the Guarantor and the Required Holders, except that (a) no
amendment or waiver of any


 


15

















 


of the
provisions of Section 2, hereof, or any defined term (as it is used therein),
will be  effective as to any
holder unless consented to by such holder in writing, and (b) no such amendment
or waiver may, without the written consent of the holder of each Note at the
time outstanding affected thereby, (i) change the percentage of the principal
amount of the Notes the holders of which are required to consent to any such
amendment or waiver, (ii) amend any of Section 1, Section 4 or this Section 6,
or (iii) release, or have the effect of releasing, the Guarantor from its
liability for any of the Guaranteed Obligations (other than as provided in
Section 1.22).


 


6.2.                            Solicitation of Holders of
Notes.


 


(a)                                  Solicitation.  The
Guarantor will provide each holder of the Notes (irrespective of the amount of
Notes then owned by it) with sufficient information, sufficiently far in
advance of the date a decision is required, to enable such holder to make an
informed and considered decision with respect to any proposed amendment, waiver
or consent in respect of any of the provisions hereof.  The Guarantor will deliver executed or true
and correct copies of each amendment, waiver or consent effected pursuant to
the provisions of this Section 6 to each holder of outstanding Notes promptly
following the date on which it is executed and delivered by, or receives the
consent or approval of, the requisite holders of Notes.


 


(b)                                 Payment.  The Guarantor will not directly or
indirectly pay or cause to be paid any remuneration, whether by way of
supplemental or additional interest, fee or otherwise, or grant any security,
to any holder of Notes as consideration for or as an inducement to the entering
into by any holder of Notes of any waiver or amendment of any of the terms and
provisions hereof unless such remuneration is concurrently paid, or security is
concurrently granted, on the same terms, ratably to each holder of Notes then
outstanding even if such holder did not consent to such waiver or amendment.


 


6.3.                            Binding Effect, etc.


 


Any amendment or waiver consented to as provided in this Section 6
applies equally to all holders of Notes and is binding upon them and upon each
future holder of any Note and upon the Guarantor without regard to whether such
Note has been marked to indicate such amendment or waiver.  No such amendment or waiver will extend to
or affect any obligation, covenant, agreement, Default or Event of Default not
expressly amended or waived or impair any right consequent thereon.  No course of dealing between the Guarantor
and the holder of any Note nor any delay in exercising any rights hereunder or
under any Note shall operate as a waiver of any rights of any holder of such
Note.  As used herein, the term “this Agreement” and
references thereto shall mean this Agreement as it may from time to time be
amended or supplemented.


 


16

















 


6.4.                            Notes held by Guarantor,
etc.


 


Solely for the purpose of determining whether the holders of the
requisite percentage of the aggregate principal amount of Notes then
outstanding approved or consented to any amendment, waiver or consent to be
given under this Agreement, or have directed the taking of any action provided
herein to be taken upon the direction of the holders of a specified percentage
of the aggregate principal amount of Notes then outstanding, Notes directly or
indirectly owned by the Guarantor, the Company or any of their respective
Affiliates shall be deemed not to be outstanding.


 


7.                                      NOTICES.


 


All notices and communications provided for hereunder shall be in
writing and sent (a) by telecopy if the sender on the same day sends a
confirming copy of such notice by an internationally-recognized expedited
delivery service (with charges prepaid), or (b) by an internationally-recognized
expedited delivery service (with charges prepaid).  Any such notice must be sent:


 


(i)                                     if to any holder,
to such holder’s address for notices determined pursuant to Section [•] of the Amended and
Restated Note Purchase Agreement, or


 


(ii)                                  if to the Guarantor,
to the Guarantor c/o Spirent plc, Gatwick Road, Crawley, West Sussex RH10 2RZ,
England, Attention: Chief Financial Accountant telecopier no.: +44-1293-767677
or at such other address as the Guarantor shall have specified to the holder of
each Note in writing (with a copy to the Company in the manner provided in the
Amended and Restated Note Purchase Agreement).


 


Notices
under this Section 7 will be deemed given only when actually received.


 


8.                                      REPRODUCTION OF DOCUMENTS.


 


This Agreement and all documents relating thereto, including, without
limitation, (a) consents, waivers and modifications that may hereafter be
executed, (b) documents received by any Noteholder at the Closing (except the
Notes themselves), and (c) financial statements, certificates and other
information previously or hereafter furnished to the holders, may be reproduced
by the holders by any photographic, photostatic, microfilm, microcard,
miniature photographic or other similar process and the holders may destroy any
original document so reproduced.  The
Guarantor agrees and stipulates that, to the extent permitted by applicable
law, any such reproduction shall be admissible in evidence as the original
itself in any judicial or administrative proceeding (whether or not the
original is in existence and whether or not such reproduction was made by any
such holder in the regular course of business) and any enlargement, facsimile
or further reproduction of such reproduction shall likewise be admissible in
evidence.  This Section 8 shall not
prohibit the Guarantor or any other holder of Notes from contesting any such


 


17

















 


reproduction
to the same extent that it could contest the original, or from introducing
evidence to demonstrate the inaccuracy of any such reproduction.


 


9.                                      TERMS DEFINED.


 


Unless the context otherwise requires, the following terms, when used
herein, shall have the respective meanings set forth below or set forth in the
Section or paragraph hereof following such term, and the following definitions
shall be equally applicable to both the singular and plural forms of any of the
terms herein defined.  Capitalised terms
used herein and not otherwise defined herein shall have the respective meanings
set forth in the Amended and Restated Note Purchase Agreement.


 


Agreement — is defined in Section 6.3.


 


Amended and Restated
Note Purchase Agreement — is defined in Preliminary Statement A.


 


Company — is defined in Preliminary Statement A.


 


Guaranteed
Obligations — is
defined in Section 1.1.


 


Guarantor — is defined in the first paragraph
hereof.


 


holder  — means each Noteholder and each other
holder, from time to time, of one or more Notes.


 


Insolvency Law — means any insolvency, bankruptcy,
reorganization, compromise, arrangement, administration, moratorium,
readjustment of debt, dissolution or liquidation or similar law of any
jurisdiction in effect at any time.


 


Noteholder
— is defined in Preliminary Statement A.


 


Notes — is defined in Preliminary Statement A.


 


property or
properties  —
means, unless otherwise specifically limited, real or personal property of any
kind, tangible or intangible, choate or inchoate.


 


Subsidiary Guarantor — means a Subsidiary of the Company that
is a “Guarantor” as such term is
defined in the Amended and Restated Note Purchase Agreement.


 


Unconditional
Guarantee — is
defined in Section 1.1.


 


18

















 


10.                               MISCELLANEOUS.


 


10.1.                     Successors and Assigns.


 


All covenants and other agreements contained in this Agreement by or on
behalf of any of the parties hereto bind and inure to the benefit of their
respective successors and assigns (including, without limitation, any
subsequent holder of a Note) whether so expressed or not.


 


10.2.                     Severability.


 


Any
provision of this Agreement that is prohibited or unenforceable in any
jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
such prohibition or unenforceability without invalidating the remaining
provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall (to the full extent permitted by law) not invalidate or
render unenforceable such provision in any other jurisdiction.


 


10.3.                     Construction.


 


(a)                                  Each covenant
contained herein shall be construed (absent express provision to the contrary)
as being independent of each other covenant contained herein, so that
compliance with any one covenant shall not (absent such an express contrary
provision) be deemed to excuse compliance with any other covenant.  Where any provision herein refers to action
to be taken by any Person, or which such Person is prohibited from taking, such
provision shall be applicable whether such action is taken directly or
indirectly by such Person.


 


(b)                                 The titles of the
Sections appear as a matter of convenience only, do not constitute a part
hereof and shall not affect the construction hereof.  The words “herein,”
“hereof,” “hereunder,” and “hereto” refer to this Agreement as a whole
and not to any particular Section or other subdivision.


 


10.4.                     Counterparts.


 


This Agreement may be executed in any number of counterparts, each of
which shall be an original but all of which together shall constitute one
instrument.


 


10.5.                     Benefits of Agreement
Restricted to Holders.


 


Nothing express or implied in this Agreement is intended or shall be
construed to give to any Person other than the Guarantor and the holders any
legal or equitable right, remedy or claim under or in respect hereof or any
covenant, condition or provision contained herein; and all such covenants,
conditions and provisions are and shall be held to be for the sole and
exclusive benefit of the Guarantor and the holders.


 


19

















 


10.6.                     Governing
Law.


 


THIS
AGREEMENT SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, AND THE RIGHTS OF
THE PARTIES SHALL BE GOVERNED BY, THE LAW OF THE STATE OF NEW YORK EXCLUDING
CHOICE-OF-LAW PRINCIPLES OF THE LAW OF SUCH STATE THAT WOULD REQUIRE THE
APPLICATION OF THE LAWS OF A JURISDICTION OTHER THAN SUCH STATE.


 


10.7.                     Jurisdiction; Service of
Process.


 


THE
GUARANTOR HEREBY IRREVOCABLY AND UNCONDITIONALLY AGREES THAT ANY SUIT, ACTION
OR PROCEEDING WITH RESPECT TO THIS AGREEMENT, OR ANY ACTION OR PROCEEDING TO
EXECUTE OR OTHERWISE ENFORCE ANY JUDGMENT IN RESPECT OF ANY BREACH HEREOF,
BROUGHT BY ANY HOLDER OF A NOTE AGAINST THE GUARANTOR OR ANY OF ITS PROPERTY,
MAY BE BROUGHT BY SUCH HOLDER OF A NOTE IN THE UNITED STATES DISTRICT COURT FOR
THE SOUTHERN DISTRICT OF NEW YORK OR ANY NEW YORK STATE COURT SITTING IN NEW
YORK CITY AS SUCH HOLDER OF A NOTE MAY IN ITS SOLE DISCRETION ELECT, AND, BY
THE EXECUTION AND DELIVERY OF THIS AGREEMENT, THE GUARANTOR IRREVOCABLY SUBMITS
TO THE JURISDICTION OF EACH SUCH COURT; AND AGREES THAT PROCESS SERVED EITHER
PERSONALLY OR BY REGISTERED MAIL SHALL, TO THE EXTENT PERMITTED BY LAW,
CONSTITUTE ADEQUATE SERVICE OF PROCESS IN ANY SUCH SUIT.  WITHOUT LIMITING THE FOREGOING, THE
GUARANTOR HEREBY APPOINTS, IN THE CASE OF ANY SUCH ACTION OR PROCEEDING BROUGHT
IN THE COURTS OF OR IN THE STATE OF NEW YORK, SPIRENT HOLDINGS CORPORATION WITH
OFFICES AT 1300 VETERANS MEMORIAL HIGHWAY, HAUPPAUGE, NEW YORK, 11788 TO
RECEIVE, FOR IT AND ON ITS BEHALF, SERVICE OF PROCESS IN THE STATE OF NEW YORK
WITH RESPECT THERETO, PROVIDED THE GUARANTOR MAY APPOINT ANY OTHER PERSON,
REASONABLY ACCEPTABLE TO THE REQUIRED HOLDERS, WITH OFFICES IN THE STATE OF NEW
YORK TO REPLACE SUCH AGENT FOR SERVICE OF PROCESS UPON DELIVERY TO THE HOLDERS
OF A REASONABLY ACCEPTABLE AGREEMENT OF SUCH NEW AGENT AGREEING SO TO ACT.  IN ADDITION, THE GUARANTOR HEREBY
IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY OBJECTION WHICH
IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE IN ANY SUIT, ACTION OR
PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT BROUGHT IN THE SAID COURTS,
AND HEREBY IRREVOCABLY WAIVES ANY CLAIM THAT ANY SUCH SUIT, ACTION OR
PROCEEDING BROUGHT IN ANY SUCH COURT HAS BEEN BROUGHT IN AN INCONVENIENT
FORUM.  NOTHING HEREIN SHALL IN ANY WAY
BE DEEMED TO LIMIT THE ABILITY OF ANY HOLDER OF A NOTE TO


 


20

















 


SERVE ANY SUCH WRITS,
PROCESS OR SUMMONSES, IN ANY MANNER PERMITTED BY APPLICABLE LAW OR TO OBTAIN
JURISDICTION OVER THE GUARANTOR, IN SUCH OTHER JURISDICTION, AND IN SUCH
MANNER, AS MAY BE PERMITTED BY APPLICABLE LAW.


 


10.8.                     Language.


 


Each
instrument, certificate, statement, legal opinion, undertaking, financial
statement, report or other document referred to herein or to be delivered
hereunder shall, except as otherwise expressly permitted hereby, be in the
English language, or, if not in the English language, accompanied by an English
translation certified by an officer of the Guarantor as correct in a manner
reasonably satisfactory to the Required Holders.


 


[Remainder of page intentionally blank.  Next page is signature page]


 


21

















 


IN WITNESS
WHEREOF, the Guarantor has caused this Agreement to be executed on its behalf
by one of its duly authorized officers as of the date first set forth above.


 


 


	
   

  	
  [NAME  OF
  GUARANTOR]

  
	
   

  	
   

  
	
   

  	
  By

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  



 


22

















 


EXHIBIT 4.5


 


PART B


 


FORM OF SUBSIDIARY GUARANTEE (UK ENTITY)


 

















 


Exhibit 4.5

Part B

(UK Entity)


 


[FORM OF SUBSIDIARY GUARANTEE]


 


[NAME OF GUARANTOR]


 


 












 


GUARANTEE


 












 


US$10,000,000

AMENDED
AND RESTATED SERIES A SENIOR NOTES DUE NOVEMBER 23, 2006


 


US$63,406,000

AMENDED
AND RESTATED SERIES B SENIOR NOTES DUE NOVEMBER 23, 2009


 


US$115,000,000

AMENDED
AND RESTATED SERIES C SENIOR NOTES DUE NOVEMBER 23, 2009


 


US$29,594,000

AMENDED
AND RESTATED SERIES D SENIOR NOTES DUE NOVEMBER 23, 2009


 


 


DATED  [              ]


 


 


ISSUED BY:

SPIRENT PLC


 


 


BINGHAM McCUTCHEN LLP

LONDON


 

















 


TABLE OF CONTENTS


 


	
  IN FAVOUR OF

  
	
  1.

  	
  GUARANTEE

  
	
   

  	
  1.1.

  	
  Guarantee

  
	
   

  	
  1.2.

  	
  Continuing
  Guarantee

  
	
   

  	
  1.3.

  	
  Additional
  Security

  
	
   

  	
  1.4.

  	
  Matters Not to Reduce the
  Guarantor’s Liability

  
	
   

  	
  1.5.

  	
  Guarantor Not to Take
  Security

  
	
   

  	
  1.6.

  	
  No Competition

  
	
   

  	
  1.7.

  	
  Suspense Account and
  Application

  
	
   

  	
  1.8.

  	
  Discharge to be
  Conditional

  
	
   

  	
  1.9.

  	
  Enforcement

  
	
   

  	
  1.10.

  	
  Payment and Withholdings

  
	
   

  	
  1.11.

  	
  Joint and Several
  Liability

  
	
   

  	
  1.12.

  	
  Severability

  
	
   

  	
  1.13.

  	
  Survival

  
	
   

  	
  1.14.

  	
  Payments on
  Guaranteed Obligations

  
	
   

  	
  1.15.

  	
  Termination, etc

  
	
   

  	
  1.16.

  	
  Enforcement
  by Holders

  
	
  2.

  	
  REPRESENTATIONS
  AND WARRANTIES OF THE GUARANTOR

  
	
   

  	
  2.1.

  	
  Representations
  and Warranties in Amended and Restated Note Purchase Agreement

  
	
   

  	
  2.2.

  	
  Warranties
  and Representations with Respect to the Guarantor and this Guarantee

  
	
  3.

  	
  COVENANTS

  
	
   

  	
  3.1.

  	
  Covenants in
  Amended and Restated Note Purchase Agreement

  
	
   

  	
  3.2.

  	
  Pari Passu Ranking

  
	
  4.

  	
  INDEMNITY

  
	
  5.

  	
  SURVIVAL OF REPRESENTATIONS AND
  WARRANTIES; ENTIRE AGREEMENT

  
	
  6.

  	
  AMENDMENT AND WAIVER

  
	
   

  	
  6.1.

  	
  Requirements

  
	
   

  	
  6.2.

  	
  Solicitation of
  Holders of Notes

  
	
   

  	
  6.3.

  	
  Binding Effect, etc

  
	
   

  	
  6.4.

  	
  Notes
  held by Guarantor, etc

  
	
  7.

  	
  NOTICES

  
	
  8.

  	
  INTERPRETATION OF THIS
  GUARANTEE

  
	
   

  	
  8.1.

  	
  Defined Terms

  
	
   

  	
  8.2.

  	
  Amended
  and Restated Note Purchase Agreement

  
	
   

  	
  8.3.

  	
  Interpretation

  
	
  9.

  	
  MISCELLANEOUS

  
	
   

  	
  9.1.

  	
  Successors and Assigns

  
	
   

  	
  9.2.

  	
  Severability

  
	
   

  	
  9.3.

  	
  Reproduction of Documents

  
	
   

  	
  9.4.

  	
  Waiver

  
											



 

















 


	
   

  	
  9.5.

  	
  Governing
  Law

  
	
   

  	
  9.6.

  	
  Jurisdiction

  



 


 

















 


THIS GUARANTEE is made on
[                          ]


 


BY:


 


(1)                                [                                ],
a corporation/limited company organized and existing under the laws of [                                ] (the “Guarantor”, which expression shall include its successors
and assigns),


 


IN FAVOUR OF


 


(2)                                 Each of the Noteholders (as defined below)
and each of the other holders from time to time of the Notes (as defined below)
(each a “Holder” and, together, the “Holders”).


 


WHEREAS:


 


(A)                               SPIRENT plc (formerly known as Bowthorpe plc), a limited
company organized and existing under the laws of England and Wales with
registered number 470893 (together with its successors and assigns, the “Company”), entered into
those certain separate Note Purchase Agreements each dated November 23,
1999 (as amended on November 14, 2000 and as further amended and restated on
March •, 2003 and as
may be further amended or varied from time to time in accordance with the terms
thereof, the “Amended and Restated Note
Purchase Agreement”), with each of the purchasers named on
Schedule A thereto (such purchasers, together with their respective transferees
and assignees, being referred to herein, individually, as a “Noteholder”, and,
collectively, as the “Noteholders”)
pursuant to which the Company issued and sold to the Noteholders (a)
US$10,000,000 principal amount of its 7.94% Senior A Senior Notes due November
23, 2006 (including any amendments, restatements or modifications from time to
time, the “Series A Notes”, such term
to include any such notes issued in substitution therefore pursuant to
Section • of the Amended
and Restated Note Purchase Agreement), (b) US$63,406,000 principal amount of
its 8.06% Series B Senior Notes due November 23, 2009 (including any
amendments, restatements or modifications from time to time, the “Series B Notes”, such term
to include any such notes issued in substitution therefore pursuant to
Section • of the Amended
and Restated Note Purchase Agreement), (c) US$115,000,000 principal amount of
its 8.16% Series C Senior Notes due November 23, 2009 (including any
amendments, restatements or modifications from time to time, the “Series C Notes”, such term
to include any such notes issued in substitution therefore pursuant to
Section • of the Amended
and Restated Note Purchase Agreement) and (d) US$29,594,000 principal amount of
its Fixed Rate Series D Senior Notes due November 23, 2009 (including any
amendments, restatements or modifications from time to time, the


 

















 


“Series D Notes”, such
term to include any such notes issued in substitution therefore pursuant to
Section • of the Amended
and Restated Note Purchase Agreement) (the Series A Notes, the Series B Notes,
the Series C Notes and the Series D Notes are referred to herein, collectively,
as the “Notes”).


 


(B)                                To induce the Noteholders to enter into the
Amended and Restated Note Purchase Agreement, the Guarantor will
unconditionally guarantee all of the payment obligations of the Company under
and pursuant to the Amended and Restated Note Purchase Agreement and the Notes
pursuant to the terms and provisions of this Guarantee.


 


NOW THIS DEED WITNESSES as follows: 


 


1.  GUARANTEE.


 


1.1.  Guarantee.


 


(a)                                 Guarantee.  In
consideration of the execution and delivery of the Amended and Restated Note
Purchase Agreement by the Noteholders, the Guarantor hereby absolutely,
irrevocably, unconditionally, jointly and severally as principal obligor
guarantees to each of the Holders the due and punctual payment and performance
of the Guaranteed Obligations (as defined in clause (b) of this Section 1.1),
and, accordingly, if and when the Company shall default in the due and punctual
payment of any of the Guaranteed Obligations, then it shall on demand by such
Holder pay to such Holder, in the currency in which the same falls due for
payment under the terms of the Amended and Restated Note Purchase Agreement (as
specifically provided in Section • of the Amended and Restated Note Purchase
Agreement), that part of the Guaranteed Obligations due and owing to such
Holder when and as the same shall become due and payable, whether at maturity,
pursuant to any mandatory or optional prepayment, by acceleration or otherwise,
as if the Guarantor instead of the Company was expressed to be the principal
obligor all in accordance with the terms and provisions hereof and thereof
(regardless of whether, in the case of any acceleration, such acceleration
shall be stayed, enjoined, delayed or otherwise prevented under applicable law
or otherwise).


 


(b)                                 Guaranteed
Obligations.  In this Guarantee,  “Guaranteed
Obligations” means, in relation to each Holder, all
moneys and other amounts which are now, or at any time hereafter shall become,
due and owing by the Company to such Holder under or pursuant to the Amended
and Restated Note Purchase Agreement and the Notes, including, without
limitation, in respect of (i) the principal of, and interest on, and the Make-Whole


 

















 


Amount
and Modified Make-Whole Amount (if any) on, the Notes, (ii) any additional
amounts which may be owing to such Holder pursuant to the terms of
Section •
of the Amended and Restated Note Purchase Agreement, and (iii) any swap
breakage costs and any other amounts payable by the Company to any Holder in
connection with any late payment of interest or principal (including amounts
owing under Section •
of the Amended and Restated Note Purchase Agreement), in each case pursuant to
the terms and provisions of the Amended and Restated Note Purchase Agreement.


 


(c)                                  Guarantee
of  Payment.  The guarantee given under this Section 1 is a
guarantee of payment and not a guarantee of collection.


 


1.2.  Continuing Guarantee.


 


This
Guarantee is a continuing security and (subject to Section • of the Amended and Restated Note Purchase
Agreement) shall remain in full force and effect until the Guaranteed
Obligations have been paid, discharged or satisfied in full notwithstanding the
liquidation or other incapacity or any change in the constitution of the
Company or of the Guarantor or in the name and style of either of them or any
settlement of account or other matter whatsoever and regardless of any
intermediate payment or discharge in whole or in part.


 


1.3.  Additional Security.


 


This
Guarantee is in addition to and shall not merge with or otherwise prejudice or
affect or be prejudiced by any other right, remedy, guarantee (including,
without limitation, any other Subsidiary Guarantee), indemnity or security and
may be enforced without first having recourse to the same or any other bill,
note, mortgage, charge, pledge or other Lien now or hereafter held by or
available to all or any of the Holders.


 


1.4.  Matters Not to Reduce the Guarantor’s
Liability.


 


(a)                                 Invalidity
or Unenforceability.  If any purported obligation or liability of
the Company which is the subject of this Guarantee is not or ceases to be valid
or enforceable on any ground whatsoever whether or not known to any of the Holders,
including but not limited to any defect in or want of powers of the Company or
irregular exercise thereof or lack of authority by any Person purporting to act
on behalf of the Company or any legal or other limitation (whether under the
Limitation Act or otherwise), disability, incapacity or any change in the
constitution of, or any amalgamation, reconstruction or liquidation of, the
Company, the Guarantor shall nevertheless be liable to indemnify the Holders in
respect of that purported obligation or liability as if the same were fully
valid and


 

















 


enforceable
and the Guarantor were the principal debtor in respect thereof.  The Guarantor as principal obligor and as a
separate and independent obligation from its liabilities under Section 1.1
hereby agrees to keep the Holders fully indemnified on demand in the currency
in which such purported obligation or liability arose (as specifically provided
in Section •
of the Amended and Restated Note Purchase Agreement) against all damages,
losses, costs and expenses suffered or incurred by any of the Holders arising
from any failure of the Company to carry out or discharge any such purported
obligation or liability.


 


(b)                                 Other
Matters.  The liability of the Guarantor shall not be
affected nor shall this Guarantee be discharged or diminished by reason of:


 


(i)                                     any present or future bill, note, guarantee
(including, without limitation, any other Subsidiary Guarantee), indemnity,
mortgage, charge, pledge, or other Lien or security, or right or remedy held by
or available to all or any of the Holders, being or becoming wholly or in part
void, voidable or unenforceable on any ground whatsoever or by all or any of
the Holders from time to time dealing with, exchanging, varying, realizing,
releasing or failing to perfect or enforce any of the same; or


 


(ii)                                  all or any of the Holders compounding with,
discharging, releasing or varying the liability of or granting any time,
indulgence or concession to the Company or any other Person or renewing,
determining or varying any bill, promissory note or other negotiable
instrument, accommodation, facility or transaction in any manner whatsoever or
concurring in, accepting or varying any compromise, arrangement or settlement
or omitting to claim or enforce payment from a principal debtor or any other
Person; or


 


(iii)                               any act or omission which would not have
discharged or affected the liability of the Guarantor had it been a principal
debtor instead of guarantor or by anything done or omitted which but for this
provision might operate to exonerate the Guarantor.


 


1.5.  Guarantor Not to Take Security.


 


The
Guarantor warrants to the Holders that it has not taken or received, and
undertakes not to take or receive, the benefit of any security from the Company
in connection with this Guarantee.  If
any such security is taken or the Guarantor receives the benefit of the same in
violation of this Section 1.5, the Guarantor declares that such security and
all moneys at any time received in


 

















 


respect thereof shall be
held on trust for the Holders to be applied ratably in discharge of the
liabilities of the Guarantor to the Holders hereunder.


 


1.6.  No Competition.


 


Until
the Guaranteed Obligations have been paid, discharged or satisfied in full, the
Guarantor waives all rights of subrogation and indemnity against the Company
and agrees not to share in any security held or moneys received by all or any
of the Holders on account of such liabilities or, unless so instructed by the
Required Holders, to claim or prove in competition with all or any of the
Holders in the liquidation of the Company in respect of any moneys paid by the
Guarantor to or under this Guarantee. 
If the Guarantor receives any payment or other benefit or exercises any
set-off or counterclaim or otherwise acts in breach of this Section 1.6,
anything so received and any benefit derived directly or indirectly by the
Guarantor therefrom shall be held on trust for the Holders to be applied
ratably in discharge of the liability of the Guarantor to the Holders
hereunder.


 


1.7.  Suspense Account and
Application.


 


(a)                                  Suspense
Account.  Any money received by a Holder in connection
with this Guarantee may be placed to the credit of an interest bearing suspense
account with a view to preserving the rights of such Holder to prove for the
whole of its claims against the Company or any other Subsidiary Guarantor
liable or may be applied by such Holder in or towards satisfaction of such of
the moneys, obligations or liabilities of the Company hereby guaranteed as such
Holder in such Holder’s absolute discretion may, subject to Section l.7(b),
from time to time conclusively determine. 
The amount standing to the credit of the suspense account shall attract
interest at such reasonable market rates offered by leading banks in the London
Interbank Market for deposits in the same currency and for each successive
period of one month (or such shorter period as the amount is to be retained on
such account) as shall be available to the Holder.


 


(b)                                 Application.  The Guarantor
shall have no right to require that any sums received by a Holder from the
Guarantor under, or pursuant to, the terms of this Guarantee should be applied
at any particular time or times (provided that
in the event that the aggregate amount of any such sums received by such Holder
and interest accrued in respect of moneys on deposit in any such suspense
account referred to in Section 1.7(a) (or the equivalent provision of any
Subsidiary Guarantee) shall be equal to or in excess of the entire outstanding
Guaranteed Obligations owing to such Holder, then such Holder shall apply such
amounts in satisfaction of such Guaranteed Obligations).


 

















 


1.8.  Discharge to be Conditional.


 


Any
release, discharge, settlement or arrangement on the faith of any security,
disposition or payment between the Guarantor and a Holder shall be conditional
upon no security, disposition or payment to any of the Holders by the Company
or any other Person (not being the Guarantor) being void, set aside or ordered
to be refunded pursuant to any enactment or law relating to bankruptcy,
liquidation or insolvency or for any reason whatever and, if such condition
shall not be fulfilled, each Holder shall be entitled to enforce this Guarantee
subsequently as if such release, discharge or settlement had not occurred and
any such payment had not been made.


 


1.9.  Enforcement.


 


A
Holder shall not be obliged before taking steps to enforce this Guarantee: (a)
to take action or obtain judgment in any court against the Company or any other
Person; or (b) to make, enforce or seek to enforce any claim against the
Company or any other Person under any security or other document, agreement or
arrangement.


 


1.10.  Payment and Withholdings.


 


All
sums due and payable by the Guarantor under this Guarantee shall be made in
full without set-off or counterclaim and free and clear of and (subject as
provided in the next sentence) without deduction for or on account of any
future or present Tax.  If:


 


(a)                                  the Guarantor is
required by law to make any deduction or withholding from any sum payable by
the Guarantor to a Holder hereunder; or


 


(b)                                 a Holder is required by law to make any
payment, on account of any Tax or otherwise, on or in relation to any amount
received or receivable by such Holder hereunder,


 


(excluding, in the case of
each Holder, taxes imposed on its overall net income, profits or gains, and
franchise taxes imposed on such Holder, by the jurisdiction under the laws of
which such Holder is organized or any political subdivision thereof) then the
sum payable by the Guarantor in respect of which such deduction, withholding or
payment is required to be made shall be increased to the extent necessary to
ensure that, after the making of such deduction, withholding or payment (and
after taking account of any deduction, withholding or payment which is required
to be made as a result of the increase), such Holder receives and retains a net
sum equal to the sum which it would have received and so retained had no such
deduction, withholding or payment been made; provided
that each


 

















 


Holder will comply with any
reasonable request of the Guarantor to comply with any form filing or similar
reporting requirement to reduce such deduction, withholding or payment within
60 days of the Guarantor providing written notice to the Holder of such filing
or similar reporting requirement, so long as any required forms and
accompanying instructions issued by the relevant taxing authority are provided
to the Holder along with such written notice. 
The foregoing notwithstanding, nothing in this Section 1.10 shall (i)
restrict the right of any Holder to arrange its tax affairs as it shall think
fit, (ii) require any Holder to disclose any information regarding its tax
affairs which, in such Holder’s reasonable and good faith judgment, constitutes
confidential or proprietary information, or (iii) subject to the paragraph
below, require any Holder to account for any indirect taxation benefits arising
from the deduction, withholding or payment of any Tax.  The obligations of the Guarantor under this
Section l.10 will survive the payment or transfer of any Note and the
termination of this Guarantee.


 


Each
Holder agrees that, with reasonable promptness after receiving written notice
from the Guarantor to the effect that such Holder is eligible for a refund in
respect of Taxes actually paid by the Guarantor, such Holder will sign and
deliver to or as reasonably directed by the Guarantor any Form provided to such
Holder by the Guarantor to enable such Holder to obtain a refund in respect of
such Taxes; and if such Holder thereafter receives such refund in respect of
such Taxes, such Holder will promptly pay such refund to the Guarantor
(together with interest, if any, received by such Holder from the relevant
taxing authority).  If a Holder applies
for a refund of such Taxes prior to a request by the Guarantor to apply for
such a refund, upon receipt of a request by the Guarantor to apply for a refund
or to turn over the proceeds of any such refund, the Holder will pay any such
refund to the Guarantor (together with interest, if any, received by such
holder from the relevant taxing authority) promptly upon receipt of such
refund, or if later, promptly upon receipt of the request from the
Guarantor.  The Guarantor agrees to pay
all reasonable out-of-pocket expenses incurred by a Holder in connection with
obtaining such refund.


 


1.11.  Joint and Several Liability.


 


The
Guarantor acknowledges and agrees that its liabilities under this Guarantee and
the liabilities of each other Subsidiary Guarantor under their respective Subsidiary
Guarantees are joint and several.


 


1.12.  Severability.


 


The
rights of the Holders under this Guarantee are several and each Holder may
separately enforce its rights under this Guarantee.


 

















 


1.13.  Survival.


 


So
long as  the Guaranteed
Obligations have not been discharged in full, the obligations of the Guarantor
under this Guarantee shall survive the transfer and payment of any Note.


 


1.14.  Payments
on Guaranteed Obligations.


 


The
Guarantor will make all payments in respect of this Guarantee to the holders in
the same manner and in the same currency as the Company is required to make
payments on the Notes in accordance with Section • of the Amended and Restated Note Purchase
Agreement.


 


1.15. Termination,
etc.


 


Nothing
shall discharge or satisfy the obligations of the Guarantor hereunder except
the full and final performance and payment of the Guaranteed Obligations.


 


1.16. Enforcement by Holders.


 


For
the purposes of the Contracts (Rights of Third Parties) Act 1999 (the “Contracts Act”), this Guarantee may be
enforced by, and will confer benefits on, each of the present and future
Holders of each of the Notes; provided, that,
for amendments and waivers as provided in Section 6.1, the consent of the
Holder or Holders at the time of that amendment and/or waiver shall be
required, but not the consent of any future Holders.


 


1.17.  Indemnity.


 


The
Guarantor irrevocably and unconditionally indemnifies as primary obligor each
Holder on demand against any loss or liability suffered by it if any Guaranteed
Obligation is or becomes unenforceable, invalid or illegal.


 


2.  REPRESENTATIONS AND WARRANTIES OF THE GUARANTOR.


 


The
Guarantor represents and warrants for the benefit of each of the Holders:


 


2.1. 
Representations and Warranties in Amended
and Restated Note Purchase Agreement.


 


Without
in any way limiting the generality of the warranties and representations
contained in Section • of the Amended and Restated Note Purchase
Agreement, each of such warranties and representations is, insofar as


 

















 


it is expressed
to apply to a Subsidiary or a Guarantor specifically or to any Subsidiary
generally, true and correct, as of the date hereof, with respect to the
Guarantor.


 


2.2.  Warranties  and Representations with Respect to the Guarantor
and this Guarantee.


 


(a)                                 Organization; Power and Authority.  The Guarantor is a corporation duly
organized and validly existing under the laws of its jurisdiction of
incorporation, and is duly qualified as a foreign corporation and (to the
extent such concept is recognized in such jurisdictions) is in good standing in
each jurisdiction in which such qualification is required by law, other than
those jurisdictions as to which the failure to be so qualified or in good
standing could not, individually or in the aggregate, reasonably be expected to
have a Material Adverse Effect.  The
Guarantor has the corporate power and authority to own or hold under lease the
properties it purports to own or hold under lease, to transact the business it
transacts and, as described in the Information Pack, proposes to transact, to
execute and deliver this Guarantee and to perform the provisions hereof.


 


(b)                                 Authorisation, etc.  This Guarantee has been duly authorised
by all necessary corporate action on the part of the Guarantor, and this
Guarantee constitutes a legal, valid and binding obligation of the Guarantor
enforceable against the Guarantor in accordance with its terms except as
provided in the Reservations.


 


(c)                                  Compliance
with Laws, Other Instruments, etc.  The execution, delivery and performance
by the Guarantor of this Guarantee will not:


 


(i)                                     contravene, result
in any breach of, or constitute a default under, or result in the creation of
any Lien in respect of any property of the Guarantor under, any indenture,
mortgage, deed of trust, loan, purchase or credit agreement, lease, memorandum
or articles of association, corporate charter or by-laws, or any other
agreement, instrument or license to which the Guarantor is bound or subject or
by which the Guarantor or any of its properties may be bound or affected,


 


(ii)                                  conflict with or
result in a breach of any of the terms, conditions or provisions of any order,
judgment, decree, or ruling of any court, arbitrator or Governmental Authority
applicable to the Guarantor, or


 

















 


(iii)                               violate any provision of any applicable law
or other rule or regulation of any Governmental Authority applicable to the
Guarantor.


 


(d)                                 Governmental
Authorisations, etc.  No consent, approval or authorisation of, or
registration, filing or declaration with, any Governmental Authority is
required in connection with the execution, delivery or performance by the
Guarantor of this Guarantee, save as may be required under sections 155 through
158, inclusive, of the Companies Act.




(e)                                  Pari Passu
Ranking.  The Guarantor’s obligations under this
Guarantee will rank at least pari
passu, without preference or
priority, with all of its other outstanding unsecured and unsubordinated
obligations, except for those obligations that are mandatorily preferred by law
and not by reason of contract.


 


(f)                                    Solvency
of Guarantor.  The Guarantor, after giving effect to the
transactions contemplated by this Guarantee, will not be unable to pay its
debts (within the meaning of Section 123(1)(a) or (e) or Section 123(2) of the
Insolvency Act).


 


3.  COVENANTS.


 


3.1. 
Covenants in Amended and Restated Note Purchase Agreement.


 


The
Guarantor will comply with each of the provisions of Section •, Section • and Section • of the Amended and Restated Note Purchase
Agreement in so far as those provisions are expressed to apply to a Subsidiary
or a Guarantor specifically or to any Subsidiary generally.


 


3.2.  Pari  Passu
Ranking.


 


The
Guarantor shall ensure that its obligations under this Guarantee will at all
times rank at least pari paasu in
all respects with the claims of all of its other unsecured creditors save those
whose claims are preferred by any bankruptcy, receivership, insolvency,
liquidation or other similar laws of general application.


 


4.                                      TRANSACTION EXPENSES.


 


The Guarantor will pay all costs and expenses (including, without
limitation, reasonable attorneys’ fees of a special United States counsel and a
special English counsel and, if reasonably required, other local counsel)
incurred


 

















 


by each Holder in connection
with this Guarantee and in connection with any amendments, waivers or consents
under or in respect of this Guarantee (whether or not such amendment, waiver or
consent becomes effective), including, without limitation: (a) the costs and
expenses incurred in enforcing or defending (or determining whether or how to
enforce or defend) any rights under this Guarantee, the Amended and Restated
Note Purchase Agreement, or the Notes or in responding to any subpoena or other
legal process or informal investigative demand issued in connection with this
Guarantee, the Amended and Restated Note Purchase Agreement, or the Notes; and
(b) the costs and expenses, including, without limitation, financial advisors’
and reporting or investigating accountants’ fees, incurred in connection with
the insolvency or bankruptcy of the Guarantor or in connection with any
work-out or restructuring of the transactions contemplated by this Guarantee,
the Amended and Restated Note Purchase Agreement, or the Notes.  The Guarantor will pay, and will save each
Holder and hold each Holder harmless from, all claims in respect of any fees,
costs or expenses if any, of brokers and finders (other than those retained by
such Holder).


 


5.  SURVIVAL OF REPRESENTATIONS AND
WARRANTIES; ENTIRE AGREEMENT.


 


All
representations and warranties contained herein shall survive the execution and
delivery of this Guarantee, the purchase or transfer by any Noteholder or other
Holder of any Note or portion thereof or interest therein and the payment of
any Note, and may be relied upon by any Holder, regardless of any investigation
made at any time by or on behalf of any Noteholder or any other Holder (it
being understood that all representations and warranties of the Guarantor
contained in this Guarantee are made only as of the date hereof).  All statements contained in any certificate
or other instrument delivered by or on behalf of the Guarantor pursuant to this
Guarantee or the Amended and Restated Note Purchase Agreement shall be deemed
representations and warranties of the Guarantor under this Guarantee (and
deemed made at the time of the delivery of such certificate or other instrument
if such delivery is after the date hereof). 
Subject to the preceding sentence, this Guarantee embodies the final
expression of all of the terms hereof and is a complete and exclusive statement
of those terms.


 


6.  AMENDMENT AND WAIVER.


 


6.1.  Requirements.


 


This
Guarantee may be amended, and the observance of any term hereof may be waived
(either retroactively or prospectively), with (and only with) the written consent
of the Guarantor and the Required Holders except that no such amendment or
waiver may, without written consent of the Holder or Holders of


 

















 


each of the Notes at the
time outstanding affected thereby, (a) change the percentage of the principal amount
of the Notes the Holders of which are required to consent to any such amendment
or waiver, or (b) amend any of Section 1, Section 2 or this Section 6.


 


6.2.  Solicitation of Holders of
Notes.


 


(a)                                 Solicitation.  The Guarantor will provide each Holder (irrespective of the amount of
Notes then owned by it) with sufficient information, sufficiently far in
advance of the date a decision is required, to enable such Holder to make an
informed and considered decision with respect to any proposed amendment, waiver
or consent in respect of any of the provisions hereof.  The Guarantor will deliver executed or true
and correct copies of each amendment, waiver or consent effected pursuant to
the provisions of this Section 6 to each Holder of outstanding Notes promptly
following the date on which it is executed and delivered by, or receives the
consent or approval of, the requisite Holders.


 


(b)                                 Payment.  The Guarantor will not directly or indirectly pay or cause to be paid
any remuneration, whether by way of supplemental or additional interest, fee or
otherwise, or grant any security, to any Holder as consideration for or as an
inducement to the entering into by any Holder of any waiver or amendment of any
of the terms and provisions hereof unless such remuneration is concurrently
paid, or security is concurrently granted, on the same terms, ratably to each
Holder holding Notes then outstanding even if such Holder did not consent to
such waiver or amendment.


 


6.3.  Binding Effect, etc.


 


Any
amendment or waiver consented to as provided in this Section 6 applies equally
to all Holders and the Guarantor without regard to whether any Note held by any
Holder has been marked to indicate such amendment or waiver.  No such amendment or waiver will extend to
or affect any obligation, covenant, agreement, Default or Event of Default not
expressly amended or waived or impair any right consequent thereon.  No course of dealing between the Guarantor
and any Holder nor any delay in exercising any rights hereunder or under any
Note shall operate as a waiver of any rights of such Holder.  As used herein, the term “this Guarantee” and references thereto
shall mean this Guarantee as it may from time to time be amended or
supplemented.


 

















 


6.4. Notes
held by Guarantor, etc.


 


Solely
for the purpose of determining whether Holders holding the requisite percentage
of the aggregate principal amount of Notes then outstanding approved or
consented to any amendment, waiver or consent to be given under this Guarantee,
or have directed the taking of any action provided herein to be taken upon the
direction of Holders holding a specified percentage of the aggregate principal
amount of Notes then outstanding, Notes directly or indirectly owned by the
Guarantor, the Company, any other Subsidiary or any of their respective
Affiliates shall be deemed not to be outstanding.


 


7.  NOTICES.


 


All
notices and communications provided for hereunder shall be in writing and sent
(a) by facsimile if the sender on the same day sends a confirming copy of such
notice by an internationally-recognized expedited delivery service (charges
prepaid), or (b) by an internationally-recognized expedited delivery service
(with charges prepaid).  Any such notice
must be sent:


 


(i)                                     if to any Holder or such Holder’s nominee, to
such Holder or such Holder’s nominee at the address specified for such
communications pursuant to Section • of the Amended and Restated Note Purchase
Agreement; or


 


(ii)                                  if to the Guarantor, to the Guarantor at:


 


c/o
Spirent plc

Gatwick Road

Crawley

West Sussex RH10 2RZ,

England

Attention: Chief Financial Accountant

facsimile no.: [+44-1293-527507]


 


or
at such other address as the Guarantor shall have specified to each Holder in
writing.


 


Notices under this Section 7
will be deemed given only when actually received.


 


8.  INTERPRETATION OF THIS GUARANTEE.


 


8.1 
Defined Terms.  Certain capitalized terms and other terms
used in this Guarantee have the following meanings:


 

















 


Amended and Restated
Note Purchase Agreement – is defined in Recital
(A).


 


Company – is defined in Recital (A).


 


Contracts Act – is defined in Section 1.16.


 


Guarantee, this – is defined in Section 6.3.


 


Guaranteed Obligations – is defined in Section 1.l(b).


 


Guarantor – is defined in the introduction hereof.


 


Holder  – is
defined in the introduction hereof.


 


Limitation Act – means the Limitation Act 1980 of the United
Kingdom, as amended from time to time.


 


Noteholder – is defined in Recital (A).


 


Notes – is defined in Recital (A),


 


Reservations – means, with respect to the enforceability of
any agreement or instrument, any limitations on such enforceability that may be
imposed by (a) applicable bankruptcy, insolvency, reorganization, moratorium or
other similar laws affecting the enforcement of creditors’ rights generally, or
(b) general principles of equity (regardless of whether such enforceability is
considered in a proceeding in equity or at law).


 


Subsidiary Guarantor – means a Subsidiary of the Company that is for
the time being a “Guarantor” as
such term is defined in the Amended and Restated Note Purchase Agreement.


 


8.2.  Amended and Restated Note
Purchase Agreement.  Capitalized terms used herein and not
otherwise defined in Section 8.1 shall have the respective meanings set
forth in the Amended and Restated Note Purchase Agreement.


 


8.3.  Interpretation.  In this
Guarantee (unless otherwise provided):


 


(a)                                  words importing the singular shall include
the plural and vice versa;


 


(b)                                  references to any document shall be construed
as references to that document, as amended, varied, novated or supplemented, as
the case may be;


 

















 


(c)                                  references to any statute or statutory
provision include any statute or statutory provision which amends, extends,
consolidates or replaces the same, or which has been amended, extended,
consolidated or replaced by the same, and shall include any orders,
regulations, instruments or other subordinate legislation made under the
relevant statute;


 


(d)                                  references to “assets”
or “property” or “properties” shall include
revenues and the right to revenues, and all personal property, assets and
rights of every kind, whether present, future or contingent, and whether
tangible or intangible, choate or inchoate (including uncalled share capital);


 


(e)                                  the words “including”
and “in particular” shall be
construed as being by way of illustration or emphasis only and shall not he
construed as, nor shall they take effect as, limiting the generality of any
foregoing words;


 


(f)                                    the words “other”
and “otherwise” shall not be
construed ejusdem generis with
any foregoing words where a wider construction is possible;


 


(g)                                 references to a “corporation”
shall include a corporation, incorporated company or other entity substantially
similar to a corporation, whether or not called a “corporation” under the laws of (or in business terminology commonly
used in) the jurisdiction where such entity is organized or conducts its
primary business;


 


(h)                                 references to a “Person”
shall be construed as to include that person’s assigns, transferees or
successors in title and shall be construed as including references to an
individual, partnership, corporation, limited liability company, firm,
association, joint venture, trust, unincorporated organization, or a government
or agency or political subdivision thereof;


 


(i)                                    references to Sections and Recitals are,
unless otherwise specified, references to Sections and Recitals of this
Guarantee.


 


9.  MISCELLANEOUS.


 


9.1.  Successors and Assigns.


 


Whenever
the Guarantor is referred to, such reference shall be deemed to include the
successors and assigns of the Guarantor, and all the covenants, promises and
agreements contained in this Guarantee by or on behalf of the Guarantor shall
bind the successors and assigns of the Guarantor and shall inure


 

















 


to the benefit of each of
the Holders whether so expressed or not and whether or not an assignment of the
rights hereunder shall have been delivered in connection with any assignment or
other transfer of Notes.


 


9.2.  Severability.


 


Any
provision of this Guarantee that is prohibited or unenforceable in any
jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
such prohibition or unenforceability without invalidating the remaining
provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall (to the full extent permitted by law) not invalidate or
render unenforceable such provision in any other jurisdiction.


 


9.3.  Reproduction of Documents.


 


The
Guarantor agrees that the provisions of Section • of the Amended and Restated Note Purchase
Agreement shall apply to the Guarantor mutatis
mutandis as if such Section were set forth in this Guarantee.


 


9.4.  Waiver of Defences.


 


The
obligations of each Guarantor will not be affected by an act, omission, matter
or thing which, but for this provision, would reduce, release or prejudice any
of its obligations under this Guarantee or prejudice or diminish those
obligations in whole or in part, including (whether or not known to it or any
Holder):


 


(a)                                  any time or waiver granted to, or composition
with, the Company or other Person;


 


(b)                                 the release of the Company or any other
Person under the terms of any composition or arrangement with any creditor or
any member of the Group;


 


(c)                                  the taking, variation, compromise, exchange,
renewal or release of, or refusal or neglect to perfect, take up or enforce,
any rights against, or security over assets of, the Company or other Person or
any non-presentation or non-observance of any formality or other requirement in
respect of any instrument or any failure to realise the full value of any
security;


 


(d)                                 any incapacity or lack of powers, authority
or legal personality of or dissolution or change in the members or status of
the Company or any other Person;


 

















 


(e)                                  any variation (however fundamental) or
replacement of a Financing Document or any other document or security so that
references to that Financing Document in this Guarantee shall include each
variation or replacement;


 


(f)                                    any unenforceabiliy, illegality or invalidity
of any obligation of any Person under any Financing Document or any other document
or security, to the intent that the Guarantors’ obligations under this
Guarantee shall remain in full force and its Guarantee be construed
accordingly, as if there were no unenforceability, illegality or invalidity; or


 


(g)                                 any postponement, discharge, reduction,
non-provability or other similar circumstance affecting any obligation of the
Company under a Financing Document resulting from any insolvency, liquidation
or dissolution proceedings or from any law, regulation or order so that each
such obligation shall for the purposes of each Guarantor’s obligations under
this Guarantee be construed as if there were no such circumstances.


 


9.5.  Governing Law.


 


THIS GUARANTEE SHALL BE
CONSTRUED AND ENFORCED IN ACCORDANCE WITH, AND THE RIGHTS OF THE GUARANTOR AND
THE HOLDERS SHALL BE GOVERNED BY, ENGLISH LAW.


 


9.6.  Jurisdiction.


 


(a)                                 Courts of
England.  THE COURTS OF ENGLAND SHALL
HAVE JURISDICTION TO SETTLE ANY DISPUTES WHICH MAY ARISE OUT OF OR IN
CONNECTION WITH THIS GUARANTEE.


 


(b)                                 Other
Jurisdictions.  THE PROVISIONS OF SECTION
9.6(a) ARE FOR THE BENEFIT OF THE HOLDERS ONLY AND ARE WITHOUT PREJUDICE TO THE
RIGHTS OF HOLDERS TO BRING ANY PROCEEDINGS RELATING TO THIS GUARANTEE IN ANY
OTHER COURT WHICH HAS COMPETENT JURISDICTION.


 


(c)                                  Certain
Waivers and Consents.  FOR THE PURPOSES OF THIS
GUARANTEE, THE GUARANTOR HEREBY (I) WAIVES ANY OBJECTIONS TO THE COURTS OF
ENGLAND HAVING


 

















 


JURISDICTION ON THE GROUNDS OF VENUE OR FORUM NON-CONVENIENS OR ANY SIMILAR
GROUNDS, AND (II) CONSENTS TO SERVICE OF PROCESS BY MAIL OR IN ANY OTHER MANNER
PERMITTED BY RELEVANT LAW.


 


 


IN WITNESS  WHEREOF, the Guarantor
has executed and delivered this Guarantee as a deed on the day and year first
above written.


 


 


	
  EXECUTED and DELIVERED as

  	
  )

  
	
   

  	
   

  
	
  a deed by [GUARANTOR] acting

  	
  )

  
	
   

  	
   

  
	
  by two Directors or one
  Director

  	
  )

  
	
   

  	
   

  
	
  and its Secretary

  	
  )

  



 


 


Director


 


 


Director/Secretary


 

















 


EXHIBIT 4.5


 


PART C


 


FORM OF SUBSIDIARY GUARANTEE (CANADIAN ENTITY)


 

















 


Exhibit 4.5

Part C

(Canadian
Entity)


 


[FORM OF SUBSIDIARY GUARANTEE]


 


GUARANTEE AGREEMENT


 


GUARANTEE AGREEMENT, dated
[                       ,                    ],
by
[                                   ],
a corporation organized and existing under the laws of
[                                           ]
(the “Guarantor”, which expression
shall include its successors I. and assigns), in favor of each of the holders
of the Notes (as such terms are defined below).


 


PRELIMINARY
STATEMENTS:


 


A.                                    SPIRENT
plc (formerly known as Bowthorpe plc), a limited company organized and
existing under the laws of England and Wales with registered number 470893
(together with its successors and assigns, the “Company”),
entered into those certain separate Note Purchase Agreements each dated
November 23, 1999 (as amended on November 14, 2000 and as further amended and
restated on March •,
2003 and as may be further amended or varied from time to time in accordance
with the terms thereof, the “Amended and
Restated Note Purchase Agreement”), with each of the
purchasers named on Schedule A thereto (such purchasers, together with their
respective transferees and assignees, being referred to herein, individually,
as a “Noteholder”, and,
collectively, as the “Noteholders”)
pursuant to which the Company issued and sold to the Noteholders (a)
US$10,000,000 principal amount of its 7.94% Senior A Senior Notes due November
23, 2006 (including any amendments, restatements or modifications from time to
time, the “Series A Notes”, such term
to include any such notes issued in substitution therefore pursuant to
Section • of the
Amended and Restated Note Purchase Agreement), (b) US$63,406,000 principal
amount of its 8.06% Series B Senior Notes due November 23, 2009 (including any
amendments, restatements or modifications from time to time, the “Series B Notes”, such term
to include any such notes issued in substitution therefore pursuant to
Section • of the
Amended and Restated Note Purchase Agreement), (c) US$115,000,000 principal
amount of its 8.16% Series C Senior Notes due November 23, 2009 (including any
amendments, restatements or modifications from time to time, the “Series C, Notes”,
such term to include any such notes issued in substitution therefore pursuant
to Section • of
the Amended and Restated Note Purchase Agreement) and (d) US$29,594,000
principal amount of its Fixed Rate Series D Senior Notes due
November 23, 2009 (including any amendments, restatements or
modifications from time to time, the “Series D
Notes”, such term to include any such notes issued in
substitution therefore pursuant to Section [•] of the Amended and Restated Note
Purchase Agreement) (the Series A Notes, the Series B Notes, the Series C Notes
and the Series D Notes are referred to herein, collectively, as the “Notes”).


 


B.                                    By agreeing to
enter into this Agreement, the Guarantor acknowledges that:


 


(a)                                  it
will directly or indirectly gain substantial financial and other benefits;


 


(b)                                 those
benefits will constitute reasonably equivalent value and fair consideration for
the purpose of any applicable Canadian bankruptcy or


 

















 


provincial
fraudulent transfer or conveyance statute and any related case law; and


 


(c)                                  each holder has acted in good faith in
connection with this Guarantee and the Restructuring Transaction.


 


NOW THEREFORE, in consideration of the foregoing and other good and valuable
consideration, the receipt of which is hereby acknowledged, the Guarantor does
hereby covenant and agree, for the benefit of all present and future holders,
from time to time, of the Notes as follows:


 


AGREEMENT:


 


1.                                      GUARANTEE.


 


1.1                               Guaranteed Obligations.


 


The
Guarantor, in consideration of the execution and delivery of the Amended and
Restated Note Purchase Agreement, hereby unconditionally, absolutely
guarantees, on a continuing basis, to each holder as and for the Guarantor’s
own debt, until final and indefeasible payment has been made the due and
punctual payment by the Company of the principal of, and interest, Make-Whole
Amount and Modified Make-Whole Amount (if any) on, the Notes at any time
outstanding and the due and punctual payment of all other amounts payable
(including, without limitation, Additional Payments) by the Company to the
holders under the Amended and Restated Note Purchase Agreement and the Notes,
in each case when and as the same shall become due and payable, whether at
maturity, pursuant to mandatory or optional prepayment, by acceleration or
otherwise, all in accordance with the terms and provisions hereof and thereof;
it being the intent of the Guarantor that the guarantee set forth herein shall
be a continuing guarantee of payment and not merely a guarantee of
collection.  All of the obligations set
forth in this Section 1.1 are referred to herein as the “Guaranteed
Obligations” and the Guarantee thereof set forth in this
Section 1 is referred to herein as the “Unconditional
Guarantee”.


 


1.2                               Payments.


 


In
the event that the Company fails to make, on or before the due date thereof,
any payment to be made of any principal amount of, or interest, Make-Whole
Amount or Modified Make-Whole Amount on, or in respect of, the Notes or of any
other amounts due to any holder under the Notes or the Amended and Restated
Note Purchase Agreement (including, without limitation, Additional Payments),
after in each case giving effect to any applicable grace periods or cure
provisions or waivers or amendments, the Guarantor shall cause forthwith to be
paid the moneys, or to be performed, kept, observed, or fulfilled each of such
obligations, in respect of which such failure has occurred in accordance with
the terms and provisions of the Amended and Restated Note Purchase Agreement
and the Notes.  In furtherance of  the foregoing, if an Event of Default shall
exist, all of the Guaranteed Obligations shall, in the manner and subject to
the limitations provided in the Amended and Restated Note Purchase Agreement
for the acceleration of the Notes (including, without limitation, the
provisions related to the annulment thereof), forthwith become due and payable
without notice, regardless of whether the acceleration of the Notes shall be
stayed, enjoined, delayed or otherwise prevented.


 


2

















 


Nothing shall discharge or satisfy the obligations of the Guarantor
hereunder except the full and final performance and indefeasible payment of the
Guaranteed Obligations.


 


1.3                               Joint and Several Liability.


 


The Guarantor acknowledges and agrees that its liabilities and the
liabilities of each of the other Subsidiary Guarantors under their respective
Subsidiary Guarantees for the due and punctual payment of the Guaranteed
Obligations shall be joint and several.


 


1.4                               Releases.


 


The Guarantor consents and agrees that, without any notice whatsoever
to or by the Guarantor and without impairing, releasing, abating, deferring,
suspending, reducing, terminating or otherwise affecting the obligations of the
Guarantor hereunder, each holder, by action or inaction, may:


 


(a)                                  compromise or settle,
renew or extend the period of duration or the time for the payment, or
discharge the performance of, or may refuse to, or otherwise not, enforce, or
may, by action or inaction, release all or any one or more parties to, any one
or more of the Notes, the Amended and Restated Note Purchase Agreement, any
other Subsidiary Guarantee, any other guarantee or agreement or instrument
related thereto or hereto;


 


(b)                                 assign, sell or
transfer, or otherwise dispose of, any one or more of the Notes;


 


(c)                                  grant waivers,
extensions, consents and other indulgences of any kind whatsoever to the
Company or any other Person liable in any manner in respect of all or any part
of the Guaranteed Obligations;


 


(d)                                 amend, modify or
supplement in any manner whatsoever and at any time (or from time to time) any
one or more of the Notes, the Amended and Restated Note Purchase Agreement, any
other Subsidiary Guarantee, any other guarantee or any agreement or instrument
related thereto or hereto;


 


(e)                                  release or substitute
any one or more of the endorsers or guarantors of the Guaranteed Obligations
whether parties hereto or not; and


 


(f)                                    sell, exchange,
release, accept, surrender or enforce rights in, or fail to obtain or perfect
or to maintain, or caused to be obtained, perfected or maintained, the
perfection of any security interest, charge or other Lien on, by action or
inaction, any property at any time pledged or granted as security in respect of
the Guaranteed Obligations, whether so pledged or granted by the Company, the
Guarantor or any other Person.


 


The Guarantor hereby ratifies and confirms any such action specified in
this Section 1.4 and agrees that the same shall be binding upon the
Guarantor.  The Guarantor hereby waives
any and all defenses, counterclaims or offsets which the Guarantor might or
could have by reason thereof.


 


1.5                               Waivers.


 


To the fullest extent permitted by law, the Guarantor hereby waives:


 


3

















 


(a)                                  notice of acceptance of this Agreement;


 


(b)                                 notice
of any purchase or acceptance of the Notes under the Amended and Restated Note
Purchase Agreement, or the creation, existence or acquisition of any of the
Guaranteed Obligations, subject to the Guarantor’s right to make inquiry of
each holder to ascertain the amount of the Guaranteed Obligations at any
reasonable time;


 


(c)                                  notice of the amount
of the Guaranteed Obligations, subject to the Guarantor’s right to make inquiry
of each holder to ascertain the amount of the Guaranteed Obligations at any
reasonable time;


 


(d)                                 notice of adverse
change in the financial condition of the Company, any of the other Subsidiary
Guarantors or any other guarantor or any other fact that might increase the
Guarantor’s risk hereunder;


 


(e)                                  notice of presentment
for payment, demand, protest, and notice thereof as to the Notes or any other
instrument;


 


(f)                                    notice of any Default or Event of Default;


 


(g)                                 all other notices and
demands to which the Guarantor might otherwise be entitled (except if such
notice or demand is specifically otherwise required to be given to the
Guarantor under this Agreement);


 


(h)                                 the right by statute
or otherwise to require any or each holder to institute suit against the
Company, any other Subsidiary Guarantor or any other guarantor or to exhaust
the rights and remedies of any or each holder against the Company, the other
Subsidiary Guarantors or any other guarantor, the Guarantor being bound to the
payment of each and all Guaranteed Obligations, whether now existing or
hereafter accruing, as fully as if such Guaranteed Obligations were directly
owing to each holder by the Guarantor;


 


(i)                                     any defense
arising by reason of any disability or other defense (other than the defense
that the Guaranteed Obligations shall have been fully and finally performed and
indefeasibly paid) of the Company or by reason of the cessation from any cause
whatsoever of the liability of the Company in respect thereof;


 


(j)                                     any stay (except
in connection with a pending appeal), valuation, appraisal, redemption or
extension law now or at any time hereafter in force that, but for this waiver,
might be applicable to any sale of property of the Guarantor made under any
judgment, order or decree based on this Agreement, and the Guarantor covenants
that it will not at any time insist upon or plead, or in any manner claim or
take the benefit or advantage of any such law; and


 


(k)                                  at all times prior to
the full and final performance and indefeasible payment of the Guaranteed
Obligations, any claim of any nature arising out of any right of indemnity,
contribution, reimbursement, indemnification or any similar right or any claim
of subrogation (whether such right or claim arises under contract, common law or
statutory or civil law) arising in respect of any payment made under this
Agreement or in connection with this Agreement, against the Company or the
estate of the Company (including Liens on the property of the Company or the
estate of the Company), in each case whether or not the Company at any time
shall be the


 


4

















 


subject
of any proceeding brought under any Insolvency Law, and the Guarantor further
agrees that it will not file any claims against the Company or the estate of
the Company in the course of any such proceeding or otherwise, and further
agrees that each holder may specifically enforce the provisions of this clause
(k).


 


1.6                               Marshaling.


 


The
Guarantor consents and agrees:


 


(a)                                  that each holder, and each Person acting for
the benefit of one or more of the holders, shall be under no obligation to
marshal any assets in favor of the Guarantor or against or in payment of any or
all of the Guaranteed Obligations; and


 


(b)                                 that, to the extent that the Company, any
other Subsidiary Guarantor or any other guarantor of any of the Guaranteed
Obligations makes a payment or payments to any holder, which payment or
payments or any part thereof are subsequently invalidated, declared to be
fraudulent or preferential, set aside or required, for any of the foregoing
reasons or for any other reason, to be repaid or paid over to a custodian,
trustee, administrator, receiver, administrative receiver, or any other
official or party under any Insolvency Law, other common or civil law, or
equitable cause, then, to the extent of such payment or repayment, the
obligation or part thereof intended to be satisfied thereby shall be revived
and continued in full force and effect as if such payment or payments had not
been made and the Guarantor shall be primarily liable for such obligation.


 


1.7                               Immediate Liability.


 


The
Guarantor agrees that the liability of the Guarantor in respect of the
Unconditional Guarantee shall be immediate and shall not be contingent upon the
exercise or enforcement by any holder or any other Person of whatever remedies
such holder or other Person may have against the Company, any other Subsidiary
Guarantor, or any other guarantor or the enforcement of any Lien or realization
upon any security such holder or other Person may at any time possess.


 


1.8                               Primary Obligations.


 


The
Unconditional Guarantee is a primary and original obligation of the Guarantor
and is an absolute, unconditional, continuing guarantee of indefeasible payment
and shall remain in full force and effect without respect to any action by any
holder specified in Section 1.4 or any future changes in conditions, including,
without limitation, change of law or any invalidity or irregularity with
respect to the issuance or assumption of any obligations (including, without
limitation, the Notes) of or by the Company, any other Subsidiary Guarantor, or
any other guarantor, or with respect to the execution and delivery of any
agreement (including, without limitation, the Notes and the Amended and Restated
Note Purchase Agreement) of the Company or any other Person.


 


1.9                               Additional Security


 


The
Unconditional Guarantee is in addition to and is not in any way prejudiced by
any other security now or subsequently held by any holder.


 


5

















 


1.10                        No Reduction or Defense.


 


The
obligations of the Guarantor under this Agreement, and the rights of any holder
to enforce such obligations by any proceedings, whether by action at law, suit
in equity or otherwise, shall not be subject to any reduction, limitation,
impairment or termination (except as set forth in Section 1.23), whether by
reason of any claim of any character whatsoever or otherwise, including,
without limitation, claims of waiver, release (except as set forth in Section
1.23), surrender, alteration or compromise, and shall not be subject to any
defense (other than any defense based upon the irrevocable payment and
performance in full of the obligations of the Company under the Amended and
Restated Note Purchase Agreement and the Notes), set-off, counterclaim,
recoupment or termination whatsoever (except as set forth in Section 1.23).


 


Without
limiting the generality of the foregoing, the obligations of the Guarantor
shall not be discharged or impaired by: 


 


(a)                                  any
default (including, without limitation, any Default or Event of Default),
failure or delay, willful or otherwise, in the performance of any obligations
by the Guarantor, the Company or any of their respective Subsidiaries or
Affiliates;


 


(b)                                 any
proceeding of, or involving, the Company or any of its Subsidiaries under any
Insolvency Law, or any merger, consolidation, amalgamation, reorganization,
dissolution, liquidation, sale of assets or winding up or change in corporate
constitution or corporate identity or loss of corporate identity of the Company
or any of its Subsidiaries or Affiliates;


 


(c)                                  any
incapacity or lack of power, authority or legal personality of, or dissolution
or change in the members or status of, the Company or any of its Subsidiaries
or any other Person;


 


(d)                                 impossibility
or illegality of performance on the part of the Company under the Amended and
Restated Note Purchase Agreement or the Notes or on the part of any other
Subsidiary Guarantor under any other Subsidiary Guarantee; 


 


(e)                                  the
invalidity, irregularity or unenforceability of the Notes, the Amended and
Restated Note Purchase Agreement, any other Subsidiary Guarantee, or any
documents referred to therein or herein; 


 


(f)                                    in
respect of the Company or any of its Subsidiaries, any change of circumstances,
whether or not foreseen or foreseeable, whether or not imputable to the Company
or any such Subsidiary, or other impossibility of performance through fire,
explosion, accident, labor disturbance, floods, droughts, embargoes, wars
(whether or not declared), terrorist activities, civil commotions, acts of God
or the public enemy, delays or failure of suppliers or carriers, inability to
obtain materials or any other causes affecting performance, or any other force
majeure, whether or not beyond the control of the Company or such Subsidiary
and whether or not of the kind hereinbefore specified;


 


(g)                                 any
attachment, claim, demand, charge, Lien, order, process, encumbrance or any
other happening or event or reason, similar or dissimilar to the foregoing, or
any withholding or diminution at the source, by reason of any taxes,
assessments, expenses, indebtedness, obligations or liabilities of any
character, foreseen or unforeseen, and whether or not valid, incurred by or
against any Person, or any claims, demands, charges, Liens or encumbrances of
any nature, foreseen or


 


6

















 


unforeseen,
incurred by any Person, or against any sums payable under the Amended and
Restated Note Purchase Agreement, the Notes, this Agreement, or any other
Subsidiary Guarantee, so that such sums would be rendered inadequate or would
be unavailable to make the payments herein provided; or 


 


(h)                                 any
order, judgment, decree, ruling or regulation (whether or not valid) of any
court of any nation or of any political subdivision thereof or any Governmental
Authority, or any other action, happening, event or reason whatsoever which
shall delay, interfere with, hinder or prevent, or in any way adversely affect,
the performance by the Company or any other Subsidiary Guarantor of any of
their respective obligations under the Amended and Restated Note Purchase
Agreement or the Notes, or the other Subsidiary Guaranties, as the case may be.


 


1.11                        No Election.


 


Each holder
shall, individually or collectively, have the right to seek recourse against
the Guarantor to the fullest extent provided for herein for its obligations
under this Agreement. No election to proceed in one form of action or
proceeding, or against any party, or on any obligation, shall constitute a
waiver of such holder’s right to proceed in any other form of action or
proceeding or against other parties unless such holder has expressly waived
such right in writing. Specifically, but without limiting the generality of the
foregoing, no action or proceeding by or on behalf of any holder against the
Company or any other Person under any document or instrument evidencing
obligations of the Company or such other Person to or for the benefit of such
holder shall serve to diminish the liability of the Guarantor under this
Agreement except to the extent that such holder unconditionally shall have
realized payment by such action or proceeding.


 


1.12                        Severability.


 


Each of the
rights and remedies granted under this Section 1 to each holder in respect of
the Notes held by such holder may be exercised by such holder without notice
to, or the consent of or any other action by, any other holder.


 


1.13                        Appropriations.


 


Until all
amounts which may be or become payable by the Company under or in connection
with the Amended and Restated Note Purchase Agreement or the Notes, by the
Guarantor under or in connection with this Agreement, or by any other
Subsidiary Guarantor under or in connection with any other Subsidiary Guarantee,
have been irrevocably and indefeasibly paid in full, any holder (or any trustee
or agent on its behalf) may:


 


(a)                                  refrain
from applying or enforcing any other moneys, security or rights held or
received by such holder (or any trustee or agent on its behalf) in respect of
those amounts, or apply and enforce the same in such manner and order as it
sees fit (whether against those amounts or otherwise) and the Guarantor shall
not be entitled to the benefit of the same; and


 


(b)                                 hold
in a suspense account any moneys received from the Guarantor, or on account of
the Guarantor’s liability under this Agreement, without liability to pay
interest on those moneys.


 


7

















 


1.14                        Other Enforcement Rights.


 


Each holder
may proceed to protect and enforce this Agreement by suit or suits or
proceedings in equity, at law or in bankruptcy or insolvency, and whether for
the specific performance of any covenant or agreement contained herein or in
execution or aid of any power herein granted; or for the recovery of judgment
for the obligations hereby guaranteed or for the enforcement of any other
proper, legal or equitable remedy available under applicable law.


 


1.15                        Invalid Payments.


 


To the extent
that any payment is made to any holder in respect of the Guaranteed Obligations
by any Person, which payment or any part thereof is subsequently invalidated,
declared to be fraudulent or preferential, set aside or required, for any of
the foregoing reasons or for any other reason, to be repaid or paid over to a
custodian, trustee, administrator, receiver, administrative receiver, or any
other party or official under any Insolvency Law, or any other common or civil
law or equitable cause, then to the extent of such payment or repayment, the obligation
or part thereof intended to be satisfied shall be revived and continued in full
force and effect as if said payment had not been made and the Guarantor shall
be primarily liable for such obligation.


 


1.16                        No Waivers or Election of
Remedies, Expenses, etc.


 


No course of
dealing and no delay on the part of any holder of any Note in exercising any
right, power or remedy shall operate as a waiver thereof or otherwise prejudice
such holder’s rights, powers or remedies. No right, power or remedy conferred
by this Agreement or the Amended and Restated Note Purchase Agreement upon any
holder shall be exclusive of any other right, power or remedy referred to
herein or therein or now or hereafter available at law, in equity, by statute
or otherwise. Without limiting the obligations of the Company under Section [•] of the Amended and
Restated Note Purchase Agreement, the Guarantor will pay to the holder of each
Note on demand all amounts specified in Section [ ] of the Amended and Restated
Note Purchase Agreement and such further amount as shall be sufficient to cover
all reasonable costs and expenses of such holder incurred in any enforcement or
collection under this Agreement, including, without limitation, reasonable
attorneys’, solicitors’ and barristers’ fees, expenses and disbursements.


 


1.17                        Restoration of Rights and
Remedies.


 


If any holder
shall have instituted any proceeding to enforce any right or remedy under this
Agreement, the Amended and Restated Note Purchase Agreement or any Note held by
such holder and such proceeding shall have been discontinued or abandoned for
any reason, or shall have been determined adversely to such holder, then and in
every such case each such holder, the Company and the Guarantor shall, except
as may be limited or affected by any determination in such proceeding, be
restored severally and respectively to its respective former position hereunder
and thereunder, and thereafter the rights and remedies of such holder shall
continue as though no such proceeding had been instituted.


 


1.18                        Payment and Withholding.


 


All sums due
and payable by the Guarantor under this Agreement shall be made in full and
without setoff or counterclaim and free and clear of and without deduction for
or on account of any future or present Tax. If:


 


(a)                                  the
Guarantor is required by law to make any deduction or withholding from any sum
payable by the Guarantor to a holder hereunder, or


 


8

















 


(b)                                 a
holder is required by law to make any payment, on account of any Tax or
otherwise on or in relation to any amount received or receivable by such holder
hereunder,


 


then the sum
payable by the Guarantor in respect of which such deduction, withholding or
payment is required to be made shall be increased to the extent necessary to
ensure that, after the making of such deduction, withholding or payment (and
after taking account of any deduction, withholding or payment which is required
to be made as a result of the increase), such holder receives and retains a net
sum equal to the sum which it would have received and so retained had no such
deduction, withholding or payment been made; provided that each holder will
comply with any reasonable request of the Guarantor to comply with any form
filing or similar reporting requirement to reduce such deduction, withholding
or payment within 60 days of the Guarantor providing written notice to the
holder of such filing or similar reporting requirement, so long as any required
forms and accompanying instructions issued by the relevant taxing authority are
provided to the holder along with such written notice. The foregoing
notwithstanding, nothing in this Section 1.18 shall (i) restrict the right of
any holder to arrange its tax affairs as it shall think fit, (ii) require any
holder to disclose any information regarding its tax affairs which, in such
holder’s reasonable and good faith judgment, constitutes confidential or
proprietary information, or (iii) subject to the paragraph below, require any
holder to account for any indirect taxation benefits arising from the
deduction, withholding or payment of any Tax. The obligations of the Guarantor
and the holders under this Section 1.18 will survive the payment or transfer of
any Note and the termination of this Agreement.


 


Each holder agrees
that, with reasonable promptness after receiving written notice from the
Guarantor to the effect that such holder is eligible for a refund in respect of
Taxes actually paid by the Guarantor, such holder will sign and deliver to or
as reasonably directed by the Guarantor any Form provided to such holder by the
Guarantor to enable such holder to obtain a refund in respect of such Taxes;
and if such holder thereafter receives such refund in respect of such Taxes,
such holder will promptly pay such refund to the Guarantor (together with
interest, if any, received by such holder from the relevant taxing authority).
If a holder applies for a refund of such Taxes prior to a request by the
Guarantor to apply for such a refund, upon receipt of a request by the Guarantor
to apply for a refund or to turn over the proceeds of any such refund, the
holder will pay any such refund to the Guarantor (together with interest, if
any, received by such holder from the relevant taxing authority) promptly upon
receipt of such refund, or if later, promptly upon receipt of the request from
the Guarantor. The Guarantor agrees to pay all reasonable out-of-pocket
expenses incurred by a holder in connection with obtaining such refund.


 


1.19                        Limitation on Guaranteed
Obligations.


 


It is the
intention of the Guarantor and each holder of Notes that the maximum amount of
the obligations of the Guarantor hereunder shall be equal to, but not in excess
of, the maximum amount permitted by applicable law. To that end, with respect
to the determination of the “maximum amount permitted by applicable law,” but
only to the extent such obligations would otherwise be avoidable, the
obligations of the Guarantor hereunder shall be limited to the maximum amount
that the Guarantor is permitted to pay in respect of the Guaranteed Obligations
under any applicable Insolvency Law (including, without limitation, if
applicable, the Bankruptcy and Insolvency
Act (Canada) and the Companies’
Creditors Arrangement Act (Canada)) and under the Criminal Code (Canada). Any such
limitation shall be apportioned amongst the Guaranteed Obligations owed to the
holders pro rata. This Section 1.19 is intended solely to preserve the rights
of each holder hereunder to


 


9

















 


the maximum extent permitted by applicable
law, and neither the Guarantor nor any other Person shall have any rights under
this Section 1.19 that it would not otherwise have under applicable law.


 


1.20                        Computation of Interest.


 


The Guarantor
acknowledges that the rates of interest applicable to the Guaranteed
Obligations will be computed on the basis of a year of 360 days and paid for
the actual number of days elapsed. For purposes of the Interest Act (Canada), whenever any
interest is calculated using a rate based on a year of 360 days such rate
determined pursuant to such calculation, when expressed as an annual rate is
equivalent to (i) the applicable rate based on a year of 360 days (ii)
multiplied by the actual number of days in the calendar year in which the period
for such interest is payable (or compounded) ends, and (iii) divided by 360.


 


1.21                        Further Assurances.


 


The Guarantor
will cooperate with the holders and execute such further instruments and
documents as the Required Holders shall reasonably request to carry out, to the
reasonable satisfaction of the Required Holders, the transactions contemplated
by the Amended and Restated Note Purchase Agreement, the Notes, this Agreement
and the documents and instruments related thereto.


 


1.22                        Survival.


 


So long as the
Guaranteed Obligations shall not have been fully and finally performed and
indefeasibly paid, the obligations of the Guarantor under the Unconditional
Guarantee shall survive the transfer and payment of any Note and the payment in
full of all the Notes.


 


1.23                        Termination.


 


Notwithstanding
anything to the contrary herein, this Agreement may be terminated and all
obligations of the Guarantor hereunder shall be automatically terminated upon
notice from the Company and satisfaction of the other conditions contained in
Section [•]
of the Amended and Restated Note Purchase Agreement.


 


2.                                      REPRESENTATIONS AND
WARRANTIES OF THE GUARANTOR.


 


2.1                             Representations and
Warranties in Amended and Restated Note Purchase Agreement.


 


Without in any
way limiting the generality of the warranties and representations contained in
Section 5 of the Amended and Restated Note Purchase Agreement, each of such
warranties and representations is, insofar as it refers to a Subsidiary or a
Guarantor specifically or to any Subsidiary generally, true and correct, as of
the date hereof, with respect to the Guarantor.


 


2.2                             Warranties and
Representations with Respect to the Guarantor and this Agreement.


 


(a)                                  Organization; Power and
Authority.  The Guarantor is a corporation duly
organized and validly existing under the laws of its jurisdiction of
incorporation, and (to the extent such concept is recognized in such
jurisdiction) in good standing under the laws of its jurisdiction of
incorporation, and is duly qualified as a foreign


 


10

















 


corporation
and (to the extent such concept is recognized in such jurisdictions) is in good
standing in each jurisdiction in which such qualification is required by law,
other than those jurisdictions as to which the failure to he so qualified or in
good standing could not, individually or in the aggregate, reasonably be
expected to have a Material Adverse Effect. The Guarantor has the corporate
power and authority to own or hold under lease the properties it purports to
own or hold under lease, to transact the business it transacts and proposes to
transact, to execute and deliver this Agreement, and to perform the provisions
hereof.


 


(b)                                 Authorization, etc.  This
Agreement has been duly authorized by all necessary corporate action on the
part of the Guarantor, and this Agreement constitutes a legal, valid and
binding obligation of the Guarantor enforceable against the Guarantor in
accordance with its terms, except as such enforceability may be limited by (a)
applicable bankruptcy, insolvency, reorganization, moratorium, or other similar
laws affecting the enforcement of creditors’ rights generally and (b) general
principles of equity (regardless of whether such enforceability is considered
in a proceeding in equity or law). 


 


(c)                                  Compliance with Laws, Other Instruments, etc.  The execution, delivery and
performance by the Guarantor of this Agreement will not 


 


(i)                                     contravene,
result in any breach of, or constitute a default under, or result in the
creation of any Lien in respect of any property of the Guarantor under, any
indenture, mortgage, deed of trust, loan, purchase or credit agreement, lease,
memorandum or articles of association, corporate charter or by-laws, or any
other agreement, instrument or license to which the Guarantor is bound or
subject or by which the Guarantor or any of its properties may be bound or
affected,


 


(ii)                                  conflict
with or result in a breach of any of the terms, conditions or provisions of any
order, judgment, decree, or ruling of any court, arbitrator or Governmental
Authority applicable to the Guarantor, or


 


(iii)                               violate any provision of any applicable law or other rule or regulation of any
Governmental Authority applicable to the Guarantor. 


 


(d)                                 Governmental Authorizations, etc.  No consent, approval or
authorization of, or registration, filing or declaration with, any Governmental
Authority is required in connection with the execution, delivery or performance
by the Guarantor of this Agreement.


 


(e)                                  Pari
Passu Ranking.  The Guarantor’s obligations
under this Agreement will rank at least pari passu, without preference or
priority, with all of its other outstanding obligations in respect of its
senior, unsecured and unsubordinated Financial Indebtedness, except for those
obligations that are mandatorily preferred by law and not by reason of
contract.


 


(f)                                    Solvency of Guarantor.  At the date hereof, the realizable value of the
Guarantor’s assets is greater than the aggregate of the following amounts: (x)
the liabilities of the Guarantor; (y) the stated capital of all classes of
shares of the Guarantor, and (z) the maximum liability of the Guarantor under
this Agreement. The Guarantor, after giving effect to this Agreement, will:


 


11

















 


(i)                                     not
be an “insolvent person” (as such
term is defined in the Bankruptcy and
Insolvency Act (Canada)), or


 


(ii)                                  not
be engaged in any business or transaction, or about to engage in any business
or transaction, for which the Guarantor has an unreasonably small capital, and
the Guarantor has no intent to


 


(A)                              hinder,
delay or defraud any entity to which it is, or will become, on or after the
date hereof, indebted, or 


 


(B)                                incur
debts that would be beyond its ability to pay as they mature, or


 


(iii)                               not
have made a transfer or incurred any obligation under a Financing Document with
the intent to hinder, delay or defraud any of its present or future creditors.


 


3.                                 COVENANTS.


 


3.1                               Covenants in Amended and
Restated Note Purchase Agreement.


 


The Guarantor will comply
with each of the provisions of Section [•] and Section [•] of the Amended and Restated Note Purchase
Agreement, and each other covenant and agreement contained therein, that is
applicable to a Subsidiary or a Guarantor specifically or to any Subsidiary
generally.


 


3.2                               Pari Passu Ranking.


 


The Guarantor
shall procure that its obligations under this Agreement will at all times rank
at least pari passu, without preference or priority, with all of its other
outstanding obligations in respect of its senior, unsecured and unsubordinated
Financial Indebtedness, except for those obligations that are mandatorily
preferred by law and not by reason of contract.


 


4.                                PAYMENTS ON NOTES.


 


4.1                               Place and Manner of Payment.


 


The Guarantor
will make all payments in respect hereof to the holders at the place and in the
manner specified in Section [•] of the Amended and Restated Note
Purchase Agreement.


 


4.2                               Currency of Payment.


 


All payments
under this Agreement shall be made in US Dollars. To the fullest extent
permitted by applicable law, the obligation of the Guarantor in respect of any
amount due under or in respect of this Agreement, notwithstanding any payment
in any currency other than US Dollars, whether as a result of (i) any judgment
or order or the enforcement thereof, (ii) the realization on any security,
(iii) the liquidation of the Guarantor, (iv) any voluntary payment by the
Guarantor or (v) any other reason, shall be discharged only to the extent of
the amount in US Dollars that each holder entitled to receive such payment may,
in accordance with normal banking procedures, purchase in the foreign exchange
markets in


 


12

















 


London, England with the sum paid in such
other currency (after any premium and costs of exchange) on the Business Day
immediately following the day on which such holder receives such payment and if
the amount in US Dollars that may be so purchased for any reason is less than
the amount originally due, the Guarantor shall indemnify and save harmless such
holder from and against all loss or damage arising out of or as a result of
such deficiency. This indemnity shall constitute an obligation separate and
independent from the other obligations contained in this Agreement, shall give
rise to a separate and independent cause of action, shall apply irrespective of
any indulgence granted by such holder from time to time and shall continue in
full force and effect notwithstanding any judgment or order for a liquidated
sum in respect of an amount due under this Agreement, the Amended and Restated
Note Purchase Agreement or under any judgment or order.


 


5.                                SURVIVAL OF REPRESENTATIONS
AND WARRANTIES; ENTIRE AGREEMENT.


 


All
representations and warranties contained herein shall survive the execution and
delivery of this Agreement, the purchase or transfer by any Noteholder of any
Note or portion thereof or interest therein and the payment of any Note, and
may be relied upon by any subsequent holder of a Note, regardless of any
investigation made at any time by or on behalf of any Noteholder or any other
holder of a Note. All statements contained in any certificate or other
instrument delivered by or on behalf of the Guarantor pursuant to this
Agreement or the Amended and Restated Note Purchase Agreement shall be deemed representations
and warranties of the Guarantor under this Agreement. Subject to the preceding
sentence, this Agreement embodies the entire agreement and understanding
between the Noteholders and the Guarantor and supersedes all prior agreements
and understandings relating to the subject matter hereof.


 


6.                                 AMENDMENT AND WAIVER.


 


6.1                                    Requirements.


 


This Agreement
may be amended, and the observance of any term hereof may be waived (either
retroactively or prospectively), with (and only with) the written consent of
the Guarantor and the Required Holders, except that (a) no amendment or waiver
of any of the provisions of Section 2, hereof, or any defined term (as it is
used therein), will be effective as to any holder unless consented to by such
holder in writing, and (b) no such amendment or waiver may, without the written
consent of the holder of each Note at the time outstanding affected thereby,
(i) change the percentage of the principal amount of the Notes the holders of
which are required to consent to any such amendment or waiver, (ii) amend any
of Section 1, Section 4 or this Section 6, or (iii) release, or have the effect
of releasing, the Guarantor from its liability for any of the Guaranteed
Obligations (other than as provided in Section 1.23).


 


6.2                                    Solicitation of Holders of
Notes.


 


(a)                                  Solicitation.  The
Guarantor will provide each holder of the Notes (irrespective of the amount of
Notes then owned by it) with sufficient information, sufficiently far in
advance of the date a decision is required, to enable such holder to make an
informed and considered decision with respect to any proposed amendment, waiver
or consent in respect of any of the provisions hereof. The Guarantor will
deliver executed or true and correct copies of each amendment, waiver or consent
effected pursuant to the provisions of this Section 6 to each holder of
outstanding


 


13

















 


Notes promptly
following the dale on which it is executed and delivered by, or receives the
consent or approval of, the requisite holders of Notes.


 


(b)                                 Payment. 
The Guarantor will not directly or indirectly pay or cause to be paid
any remuneration, whether by way of supplemental or additional interest, fee or
otherwise, or grant any security, to any holder of Notes as consideration for
or as an inducement to the entering into by any holder of Notes of any waiver
or amendment of any of the terms and provisions hereof unless such remuneration
is concurrently paid, or security is concurrently granted, on the same terms,
ratably to each holder of Notes then outstanding even if such holder did not
consent to such waiver or amendment.


 


6.3                               Binding Effect, etc.


 


Any amendment
or waiver consented to as provided in this Section 6 applies equally to all
holders of Notes and is binding upon them and upon each future holder of any
Note and upon the Guarantor without regard to whether such Note has been marked
to indicate such amendment or waiver. No such amendment or waiver will extend
to or affect any obligation, covenant, agreement, Default or Event of Default
not expressly amended or waived or impair any right consequent thereon. No
course of dealing between the Guarantor and the holder of any Note nor any
delay in exercising any rights hereunder or under any Note shall operate as a
waiver of any rights of any holder of such Note. As used herein, the term “this Agreement” and references thereto
shall mean this Agreement as it may from time to time be amended or
supplemented.


 


6.4                               Notes held by Guarantor,
etc.


 


Solely for the
purpose of determining whether the holders of the requisite percentage of the
aggregate principal amount of Notes then outstanding approved or consented to
any amendment, waiver or consent to be given under this Agreement, or have
directed the taking of any action provided herein to be taken upon the
direction of the holders of a specified percentage of the aggregate principal
amount of Notes then outstanding, Notes directly or indirectly owned by the
Guarantor, the Company or any of their respective Affiliates shall be deemed
not to be outstanding.


 


7.                                      NOTICES.


 


All notices
and communications provided for hereunder shall be in writing and sent (a) by
telecopy if the sender on the same day sends a confirming copy of such notice
by an internationally-recognized expedited delivery service (with charges
prepaid), or (b) by an internationally-recognized expedited delivery service
(with charges prepaid). Any such notice must be sent:


 


14

















 


(i)                                     if
to any holder, to such holder’s address for notices determined pursuant to
Section [•] of the
Amended and Restated Note Purchase Agreement, or


 


(ii)                                  if
to the Guarantor, to the Guarantor at c/o Spirent plc, Gatwick Road, Crawley,
West Sussex RH10 2RZ, England, Attention: Chief Financial Accountant, facsimile
no.: +44 1293 767677, or at such other address as the Guarantor shall have
specified to the holder of each Note in writing (with a copy to the Company in
the manner provided in the Amended and Restated Note Purchase Agreement).


 


Notices under
this Section 7 will be deemed given only when actually  received.


 


8.                                      REPRODUCTION OF DOCUMENTS.


 


This Agreement and all
documents relating thereto, including, without limitation, (a) consents,
waivers and modifications that may hereafter be executed, (b) documents
received by any Noteholder at the Closing (except the Notes themselves), and
(c) financial statements, certificates and other information previously or
hereafter furnished to the holders, may be reproduced by the holders by any photographic,
photostatic, microfilm, microcard, miniature photographic or other similar
process and the holders may destroy any original document so reproduced. The
Guarantor agrees and stipulates that, to the extent permitted by applicable
law, any such reproduction shall be admissible in evidence as the original
itself in any judicial or administrative proceeding (whether or not the
original is in existence and whether or not such reproduction was made by any
such holder in the regular course of business) and any enlargement, facsimile
or further reproduction of such reproduction shall likewise be admissible in
evidence. This Section 8 shall not prohibit the Guarantor or any other holder
of Notes from contesting any such reproduction to the same extent that it could
contest the original, or from introducing evidence to demonstrate the
inaccuracy of any such reproduction.


 


9.                                      TERMS DEFINED.


 


Unless the context otherwise
requires, the following terms, when used herein, shall have the respective
meanings set forth below or set forth in the Section or paragraph hereof
following such term, and the following definitions shall be equally applicable
to both the singular and plural forms of any of the terms herein defined.
Capitalised terms used herein and not otherwise defined herein shall have the
respective meanings set forth in the Amended and Restated Note Purchase
Agreement.


 


Agreement — is defined in Section 6.3.


 


Amended and Restated Note Purchase Agreement — is defined in Preliminary Statement A.


 


Company — is defined in Preliminary Statement A.


 


Guaranteed Obligations —
is defined in Section 1.1.


 


Guarantor — is
defined in the first paragraph hereof.


 


15

















 


holder — means each Noteholder and each other
holder, from time to time, of one or more Notes.


 


Insolvency Law —  means any insolvency, bankruptcy,
reorganization, compromise, arrangement, administration, moratorium,
readjustment of debt, dissolution or liquidation or similar law of any
jurisdiction in effect at any time.


 


Noteholder — is defined in Preliminary Statement A.


 


Notes — is
defined in Preliminary Statement A.


 


property or properties —
means, unless otherwise specifically limited, real or personal property of any
kind, tangible or intangible, choate or inchoate.


 


Subsidiary Guarantor —  means a Subsidiary of the Company that is
a “Guarantor” as such term is defined in the Amended and Restated Note Purchase
Agreement.


 


Unconditional Guarantee — is
defined in Section 1.1.


 


10.                            MISCELLANEOUS.


 


10.1                       Successors and Assigns.


 


All covenants
and other agreements contained in this Agreement by or on behalf of any of the
parties hereto bind and inure to the benefit of their respective successors and
assigns (including, without limitation, any subsequent holder of a Note)
whether so expressed or not.


 


10.2                       Severability.


 


Any provision
of this Agreement that is prohibited or unenforceable in any jurisdiction
shall, as to such jurisdiction, be ineffective to the extent of such
prohibition or unenforceability without invalidating the remaining provisions
hereof, and any such prohibition or unenforceability in any jurisdiction shall
(to the full extent permitted by law) not invalidate or render unenforceable
such provision in any other jurisdiction.


 


10.3                        Construction.


 


(a)                                  Each
covenant contained herein shall be construed (absent express provision to the
contrary) as being independent of each other covenant contained herein, so that
compliance with any one covenant shall not (absent such an express contrary
provision) be deemed to excuse compliance with any other covenant. Where any
provision herein refers to action to be taken by any Person, or which such
Person is prohibited from taking, such provision shall be applicable whether
such action is taken directly or indirectly by such Person.


 


(b)                                 The
titles of the Sections appear as a matter of convenience only, do not
constitute a part hereof and shall not affect the construction hereof.  The words “herein,” “hereof,” “hereunder,”
and “hereto” refer to this Agreement as a whole and not to any particular
Section or other subdivision.


 


16

















 


10.4                        Counterparts.


 


This Agreement may be
executed in any number of counterparts, each of which shall be an original but
all of which together shall constitute one instrument.


 


10.5                        Benefits of Agreement
Restricted to Holders.


 


Nothing
express or implied in this Agreement is intended or shall be construed to give
to any Person other than the Guarantor and the holders any legal or equitable
right, remedy or claim under or in respect hereof or any covenant, condition or
provision contained herein; and all such covenants, conditions and provisions
are and shall be held to be for the sole and exclusive benefit of the Guarantor
and the holders.


 


10.6                        Governing Law.


 


THIS AGREEMENT
SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, AND THE RIGHTS OF THE
PARTIES SHALL BE GOVERNED BY, THE LAW OF THE STATE OF NEW YORK EXCLUDING
CHOICE-OF-LAW PRINCIPLES OF THE LAW OF SUCH STATE THAT WOULD REQUIRE THE APPLICATION
OF THE LAWS OF A JURISDICTION OTHER THAN SUCH STATE.


 


10.7                        Jurisdiction; Service of
Process, Jury Trial Waiver.


 


THE GUARANTOR
HEREBY IRREVOCABLY AND UNCONDITIONALLY AGREES THAT ANY SUIT, ACTION OR
PROCEEDING WITH RESPECT TO THIS AGREEMENT, OR ANY ACTION OR PROCEEDING TO
EXECUTE OR OTHERWISE ENFORCE ANY JUDGMENT IN RESPECT OF ANY BREACH HEREOF,
BROUGHT BY ANY HOLDER OF A NOTE AGAINST THE GUARANTOR OR ANY OF ITS PROPERTY,
MAY BE BROUGHT BY SUCH HOLDER OF A NOTE IN THE UNITED STATES DISTRICT COURT FOR
THE SOUTHERN DISTRICT OF NEW YORK OR ANY NEW YORK STATE COURT SITTING IN NEW
YORK CITY AS SUCH HOLDER OF A NOTE MAY IN ITS SOLE DISCRETION ELECT, AND, BY
THE EXECUTION AND DELIVERY OF THIS AGREEMENT, THE GUARANTOR IRREVOCABLY SUBMITS
TO THE JURISDICTION OF EACH SUCH COURT; AND AGREES THAT PROCESS SERVED EITHER
PERSONALLY OR BY REGISTERED MAIL SHALL, TO THE EXTENT PERMITTED BY LAW,
CONSTITUTE ADEQUATE SERVICE OF PROCESS IN ANY SUCH SUIT.  WITHOUT LIMITING THE FOREGOING, THE
GUARANTOR HEREBY APPOINTS, IN THE CASE OF ANY SUCH ACTION OR PROCEEDING BROUGHT
IN THE COURTS OF OR IN THE STATE OF NEW YORK, SPIRENT HOLDINGS CORPORATION WITH
OFFICES AT 1300 VETERANS MEMORIAL HIGHWAY, HAUPPAUGE, NEW YORK, 11788,
[                                                                        ]
TO RECEIVE, FOR IT AND ON ITS BEHALF, SERVICE OF PROCESS IN THE STATE OF NEW
YORK WITH RESPECT THERETO, PROVIDED THE GUARANTOR MAY APPOINT ANY OTHER PERSON,
REASONABLY ACCEPTABLE TO THE REQUIRED HOLDERS, WITH OFFICES IN THE STATE OF NEW
YORK TO REPLACE SUCH AGENT FOR SERVICE OF PROCESS UPON DELIVERY TO THE HOLDERS
OF A REASONABLY ACCEPTABLE AGREEMENT OF SUCH NEW AGENT AGREEING SO TO ACT.  IN ADDITION, THE GUARANTOR HEREBY
IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY OBJECTION WHICH
IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE IN ANY SUIT, ACTION OR
PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT BROUGHT IN THE SAID
COURTS, AND HEREBY IRREVOCABLY WAIVES ANY CLAIM THAT ANY SUCH SUIT, ACTION OR
PROCEEDING BROUGHT IN ANY SUCH COURT HAS BEEN


 


17

















 


BROUGHT IN AN INCONVENIENT FORUM.  NOTHING HEREIN SHALL IN ANY WAY BE DEEMED TO
LIMIT THE ABILlTY OF ANY HOLDER OF A NOTE TO SERVE ANY SUCH WRITS, PROCESS OR
SUMMONSES, IN ANY MANNER PERMITTED BY APPLICABLE LAW OR TO OBTAIN JURISDICTION
OVER THE GUARANTOR, IN SUCH OTHER JURISDICTION, AND IN SUCH MANNER, AS MAY BE
PERMITTED BY APPLICABLE LAW.


 


THE GUARANTOR
HEREBY WAIVES ANY RIGHT TO TRIAL BY JURY OF ANY CLAIM, DEMAND, ACTION OR CAUSE
OF ACTION (i) ARISING UNDER THIS AGREEMENT, THE AMENDED AND RESTATED NOTE
PURCHASE AGREEMENT, THE NOTES, ANY OTHER SUBSIDIARY GUARANTEE, ANY OTHER
GUARANTEE OR AGREEMENT OR INSTRUMENT RELATED THERETO OR HERETO OR (ii) IN ANY
WAY CONNECTED WITH OR RELATED OR INCIDENTAL TO THE DEALINGS OF THE GUARANTOR
AND ANY HOLDER OF THE NOTES IN RESPECT OF THIS AGREEMENT OR THE AMENDED AND
RESTATED NOTE PURCHASE AGREEMENT, THE NOTES, ANY OTHER SUBSIDIARY GUARANTEE,
ANY OTHER GUARANTEE OR AGREEMENT OR INSTRUMENT RELATED THERETO OR HERETO OR THE
TRANSACTIONS RELATED HERETO OR THERETO IN EACH CASE WHETHER NOW EXISTING OR
HEREAFTER ARISING, AND WHETHER IN CONTRACT, TORT, EQUITY OR OTHERWISE.  THE GUARANTOR HEREBY AGREES AND CONSENTS
THAT ANY SUCH CLAIM, DEMAND, ACTION OR CAUSE OF ACTION SHALL BE DECIDED BY
COURT TRIAL WITHOUT A JURY AND THAT ANY GUARANTOR OR HOLDER MAY FILE AN
ORIGINAL COUNTERPART OF A COPY OF THIS AGREEMENT WHICH ANY COURT AS WRITTEN
EVIDENCE OF THE CONSENT OF THE GUARANTOR AND HOLDER TO THE WAIVER OF THEIR
RIGHT TO TRIAL BY JURY.


 


10.8                        Currency Indemnity.


 


If, for the
purposes of obtaining judgment in any court in any jurisdiction with respect to
this Agreement or the Amended and Restated Note Purchase Agreement, the Notes,
any other Subsidiary Guarantee, any other guarantee or agreement related
thereto or hereto, it becomes necessary to convert into the currency of such
jurisdiction (the “Judgment Currency”) any amount due under this Agreement or
the Amended and Restated Note Purchase Agreement, the Notes, any other
Subsidiary Guarantee, any other guarantee or agreement related thereto or
hereto in any currency other than the Judgment Currency (the “Currency Due”),
then conversion shall be made at the exchange rate prevailing on the Business
Day before the day of which judgment is given. 
For this purpose, “rate of exchange” means the rate at which a holder is
able, on the relevant date, to purchase the Currency Due in accordance with
normal practice.  In the event that
there is a change in the exchange rate prevailing between the Business Day
before the day on which the judgment is given and the date of receipt by the
holder of the amount due, the Guarantor will, on the date of receipt by the
holder, pay such additional amounts, if any, or be entitled to receive
reimbursement of such amount, if any, as may be necessary to ensure that the
amount received by such holder on such date is the amount in the Judgment
Currency which when converted at the rate of exchange prevailing on the date of
receipt by such holder is the amount then due under this Agreement or the
Amended and Restated Note Purchase Agreement, the Notes, any other Subsidiary
Guarantee, any other guarantee or agreement related thereto or hereto in the
Currency Due.  If the amount of the
Currency Due which the holder is able to purchase is less than the amount of
the Currency Due originally due to it, the Guarantor shall indemnify and save
such holder harmless from and against loss or damage arising as a result of
such deficiency. The indemnity contained herein shall constitute an


 


18

















 


obligation separate and independent from the other obligations
contained in this Agreement and the Amended and Restated Note Purchase
Agreement, the Notes, any other Subsidiary Guarantee, any other guarantee and
agreement related thereto or hereto, shall give rise to a separate and
independent cause of action, shall apply irrespective of any indulgence granted
by the holder from time to time and shall continue in full force and effect
notwithstanding any judgment or order for a liquidated sum in respect of an
amount due under this Agreement or under the Amended and Restated Note Purchase
Agreement, the Notes, any other Subsidiary Guarantee, any other guarantee or agreement
related thereto or hereto or under any judgment or order.


 


10.9                        Language.


 


Each instrument,
certificate, statement, legal opinion, undertaking, financial statement, report
or other document referred to herein or to be delivered hereunder shall, except
as otherwise expressly permitted hereby, be in the English language, or, if not
in the English language, accompanied by an English translation certified by an
officer of the Guarantor as correct in a manner reasonably satisfactory to the
Required Holders.


 


 


[Remainder of page
intentionally blank. Next page is signature page]


 


19

















 


IN WITNESS WHEREOF, the Guarantor has caused this Agreement to be
executed on its behalf by one of its duly authorized officers as of the date
first set forth above.


 


 


	
   

  	
  [NAME OF GUARANTOR]

  
	
   

  	
   

  
	
   

  	
  By

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  



 


20

















 


EXHIBIT 4.5


 


PART
D


 


FORM
OF SUBSIDIARY GUARANTEE (GUERNSEY ENTITY)


 

















 


Exhibit 4.5

Part D

(Guernsey Entity)


 


[FORM OF
SUBSIDIARY GUARANTEE]


 


 


[NAME OF
GUARANTOR]


 


 












 


GUARANTEE


 












 


US$10,000,000
AMENDED AND
RESTATED SERIES A SENIOR NOTES DUE NOVEMBER 23, 2006


 


US$63,406,000
AMENDED AND
RESTATED SERIES B SENIOR NOTES DUE NOVEMBER 23, 2009


 


US$115,000,000
AMENDED AND RESTATED
SERIES C
SENIOR
NOTES DUE NOVEMBER 23, 2009


 


US$29,594,000
AMENDED AND
RESTATED SERIES D SENIOR NOTES DUE NOVEMBER 23, 2009


 


 


DATED
[                 ]


 


 


ISSUED BY:
SPIRENT PLC


 


 


BINGHAM
McCUTCHEN LLP

LONDON


 

















 


TABLE OF CONTENTS


 


	
  IN FAVOUR OF

  
	
  1.  GUARANTEE

  
	
   

  	
  1.1.  Guarantee

  
	
   

  	
  1.2.  Continuing Guarantee

  
	
   

  	
  1.3. 
  Additional Security

  
	
   

  	
  1.4.  Matters Not to Reduce the Guarantor’s
  Liability

  
	
   

  	
  1.5.  Guarantor Not to Take Security

  
	
   

  	
  1.6.  No Competition

  
	
   

  	
  1.7.  Suspense Account and Application

  
	
   

  	
  1.8.  Discharge to be Conditional

  
	
   

  	
  1.9.  Enforcement

  
	
   

  	
  1.10.  Payment and Withholdings

  
	
   

  	
  1.11.  Joint and Several Liability

  
	
   

  	
  1.12. 
  Severability

  
	
   

  	
  1.13. 
  Survival

  
	
   

  	
  1.14.  Payments on Guaranteed Obligations

  
	
   

  	
  1.15.  Termination, etc.

  
	
   

  	
  1.16.  Enforcement by Holders

  
	
  2.  REPRESENTATIONS AND WARRANTIES OF THE
  GUARANTOR

  
	
   

  	
  2.1.  Representations and Warranties in Amended
  and Restated Note Purchase Agreement

  
	
   

  	
  2.2.  Warranties and Representations with Respect
  to the Guarantor and this Guarantee

  
	
  3.  COVENANTS

  
	
   

  	
  3.1.  Covenants in Amended and Restated Note
  Purchase Agreement

  
	
   

  	
  3.2.  Pari Passu Ranking

  
	
  4.  INDEMNITY

  
	
  5.  SURVIVAL OF REPRESENTATIONS AND
  WARRANTIES; ENTIRE AGREEMENT

  
	
  6.  AMENDMENT AND WAIVER

  
	
   

  	
  6.1.  Requirements

  
	
   

  	
  6.2.  Solicitation of Holders of Notes

  
	
   

  	
  6.3.  Binding Effect, etc.

  
	
   

  	
  6.4.  Notes held by Guarantor, etc.

  
	
  7.  NOTICES

  
	
  8.  INTERPRETATION OF THIS GUARANTEE

  
	
   

  	
  8.1. 
  Defined Terms

  
	
   

  	
  8.2.  Amended and Restated Note Purchase
  Agreement

  
	
   

  	
  8.3. 
  Interpretation

  
	
  9. 
  MISCELLANEOUS

  
	
   

  	
  9.1.  Successors and Assigns

  
	
   

  	
  9.2. 
  Severability

  
	
   

  	
  9.3.  Reproduction of Documents

  
	
   

  	
  9.4.  Waiver

  



 

















 


	
   

  	
  9.5.  Governing Law

  
	
   

  	
  9.6. 
  Jurisdiction

  



 

















 


THIS
GUARANTEE is made on
[                        .]


 


 


BY:


 


(1)                                  [                               ],
a corporation/limited company organized and existing under the laws of 
[                               ]
(the “Guarantor”, which expression
shall include its successors and assigns).


 


IN FAVOUR OF


 


(2)                                  Each of the Noteholders (as defined below)
and each of the other holders from time to time of the Notes (as defined below)
(each a “Holder” and, together,
the “Holders”).


 


WHEREAS:


 


(A)                              SPIRENT plc (formerly known as Bowthorpe plc), a limited
company organized and existing under the laws of England and Wales with
registered number 470893 (together with its successors and assigns, the “Company”), entered into those certain
separate Note Purchase Agreements each dated November 23, 1999 (as amended on
November 14, 2000 and as further amended and restated on March •, 2003 and as may be further amended or
varied from time to time in accordance with the terms thereof, the “Amended and Restated Note Purchase Agreement”),
with each of the purchasers named on Schedule A thereto (such purchasers,
together with their respective transferees and assignees, being referred to
herein, individually, as a “Noteholder”,
and, collectively, as the “Noteholders”)
pursuant to which the Company issued and sold to the Noteholders (a)
US$10,000,000 principal amount of its 7.94% Senior A Senior Notes due November
23, 2006 (including any amendments, restatements or modifications from time to
time, the “Series A Notes”, such
term to include any such notes issued in substitution therefore pursuant to
Section • of the Amended
and Restated Note Purchase Agreement), (b) US$63,406,000 principal amount of
its 8.06% Series B Senior Notes due November 23, 2009 (including any
amendments, restatements or modifications from time to time, the “Series B Notes”, such term to include any
such notes issued in substitution therefore pursuant to Section • of the Amended and Restated Note Purchase
Agreement), (c) US$115,000,000 principal amount of its 8.16% Series C Senior
Notes due November 23, 2009 (including any amendments, restatements or
modifications from time to time, the “Series
C Notes”, such term to include any such notes issued in substitution
therefore pursuant to Section •
of the Amended and Restated Note Purchase Agreement) and (d) US$29,594,000
principal amount of its Fixed Rate Series D Senior Notes due November 23, 2009
(including any amendments, restatements or modifications from time to time, the


 

















 


“Series D
Notes”, such term to
include any such notes issued in substitution therefore pursuant to Section • of the Amended and Restated Note Purchase
Agreement) (the Series A Notes, the Series B Notes, the Series C Notes and the
Series D Notes are referred to herein, collectively, as the “Notes”).


 


(B)                                To induce the Noteholders to enter into the
Amended and Restated Note Purchase Agreement, the Guarantor will
unconditionally guarantee all of the payment obligations of the Company under
and pursuant to the Amended and Restated Note Purchase Agreement and the Notes
pursuant to the terms and provisions of this Guarantee.


 


NOW THIS
DEED WITNESSES as
follows:


 


1.    GUARANTEE.


 


1.1. Guarantee.


 


(a)                                    Guarantee.  In
consideration of the execution and delivery of the Amended and Restated Note
Purchase Agreement by the Noteholders, the Guarantor hereby absolutely,
irrevocably, unconditionally, jointly and severally as principal obligor
guarantees to each of the Holders the due and punctual payment and performance
of the Guaranteed Obligations (as defined in clause (b) of this Section 1.1),
and, accordingly, if and when the Company shall default in the due and punctual
payment of any of the Guaranteed Obligations, then it shall on demand by such
Holder pay to such Holder, in the currency in which the same falls due for
payment under the terms of the Amended and Restated Note Purchase Agreement (as
specifically provided in Section • of the Amended and Restated Note Purchase Agreement), that part of the
Guaranteed Obligations due and owing to such Holder when and as the same shall
become due and payable, whether at maturity, pursuant to any mandatory or
optional prepayment, by acceleration or otherwise, as if the Guarantor instead
of the Company was expressed to be the principal obligor all in accordance with
the terms and provisions hereof and thereof (regardless of whether, in the case
of any acceleration, such acceleration shall be stayed, enjoined, delayed or
otherwise prevented under applicable law or otherwise).


 


(b)                                    Guaranteed
Obligations.  In this Guarantee, “Guaranteed Obligations” means, in relation to each Holder,
all moneys and other amounts which are now, or at any time hereafter shall
become, due and owing by the Company to such Holder under or pursuant to the
Amended and Restated Note Purchase Agreement and the Notes, including, without
limitation, in respect of (i) the principal of, and interest on, and the
Make-Whole


 

















 


Amount and Modified
Make-Whole Amount (if any) on, the Notes, (ii) any additional amounts which may
be owing to such Holder pursuant to the terms of Section • of the Amended and Restated Note Purchase
Agreement, and (iii) any swap breakage costs and any other amounts payable by
the Company to any Holder in connection with any late payment of interest or
principal (including amounts owing under Section • of the Amended and Restated Note Purchase
Agreement), in each case pursuant to the terms and provisions of the Amended
and Restated Note Purchase Agreement.


 


(c)                                   Guarantee
of Payment.   The guarantee given under this Section 1 is a
guarantee of payment and not a guarantee of collection.


 


1.2.                            Continuing Guarantee.


 


This Guarantee is a
continuing security and (subject to Section • of the Amended and Restated Note
Purchase Agreement) shall remain in full force and effect until the Guaranteed
Obligations have been paid, discharged or satisfied in full notwithstanding the
liquidation or other incapacity or any change in the constitution of the Company
or of the Guarantor or in the name and style of either of them or any
settlement of account or other matter whatsoever and regardless of any
intermediate payment or discharge in whole or in part.


 


1.3.                            Additional
Security.


 


This Guarantee is in
addition to and shall not merge with or otherwise prejudice or affect or be
prejudiced by any other right, remedy, guarantee (including, without
limitation, any other Subsidiary Guarantee), indemnity or security and may be
enforced without first having recourse to the same or any other bill, note,
mortgage, charge, pledge or other Lien now or hereafter held by or available to
all or any of the Holders.


 


1.4.                              Matters Not to Reduce the Guarantor’s
Liability.


 


(a)                                 Invalidity
or Unenforceability.  If any
purported obligation or liability of the Company which is the subject of this
Guarantee is not or ceases to be valid or enforceable on any ground whatsoever
whether or not known to any of the Holders, including but not limited to any
defect in or want of powers of the Company or irregular exercise thereof or
lack of authority by any Person purporting to act on behalf of the Company or
any legal or other limitation (whether under the Limitation Act or otherwise),
disability, incapacity or any change in the constitution of, or any
amalgamation, reconstruction or liquidation of, the Company, the Guarantor
shall nevertheless be liable to indemnify the Holders in respect of that
purported obligation or liability as if the same were fully valid and


 

















 


enforceable and the Guarantor
were the principal debtor in respect thereof. 
The Guarantor as principal obligor and as a separate and independent
obligation from its liabilities under Section 1.1 hereby agrees to keep the
Holders fully indemnified on demand in the currency in which such purported
obligation or liability arose (as specifically provided in Section • of the Amended and Restated Note Purchase
Agreement) against all damages, losses, costs and expenses suffered or incurred
by any of the Holders arising from any failure of the Company to carry out or
discharge any such purported obligation or liability.


 


(b)                                 Other
Matters.  The liability of the Guarantor shall not be
affected nor shall this Guarantee be discharged or diminished by reason of: 


 


(i)                                     any present or future bill, note, guarantee
(including, without limitation, any other Subsidiary Guarantee), indemnity,
mortgage, charge, pledge, or other Lien or security, or right or remedy held by
or available to all or any of the Holders, being or becoming wholly or in part void,
voidable or unenforceable on any ground whatsoever or by all or any of the
Holders from time to time dealing with, exchanging, varying, realizing,
releasing or failing to perfect or enforce any of the same; or


 


(ii)                                  all or any of the Holders compounding with,
discharging, releasing or varying the liability of or granting any time,
indulgence or concession to the Company or any other Person or renewing,
determining or varying any bill, promissory note or other negotiable
instrument, accommodation, facility or transaction in any manner whatsoever or
concurring in, accepting or varying any compromise, arrangement or settlement
or omitting to claim or enforce payment from a principal debtor or any other
Person; or


 


(iii)                               any act or omission which would not have
discharged or affected the liability of the Guarantor had it been a principal
debtor instead of guarantor or by anything done or omitted which but for this
provision might operate to exonerate the Guarantor.


 


1.5.                            Guarantor Not to Take Security.


 


The Guarantor warrants to
the Holders that it has not taken or received, and undertakes not to take or
receive, the benefit of any security from the Company in connection with this
Guarantee.  If any such security is taken
or the Guarantor receives the benefit of the same in violation of this Section
1.5, the Guarantor declares that such security and all moneys at any time
received in


 

















 


respect thereof shall be held on trust for the Holders to be applied
ratably in discharge of the liabilities of the Guarantor to the Holders
hereunder.


 


1.6.                            No
Competition.


 


Until the Guaranteed
Obligations have been paid, discharged or satisfied in full, the Guarantor
waives all rights of subrogation and indemnity against the Company and agrees
not to share in any security held or moneys received by all or any of the
Holders on account of such liabilities or, unless so instructed by the Required
Holders, to claim or prove in competition with all or any of the Holders in the
liquidation of the Company in respect of any moneys paid by the Guarantor to or
under this Guarantee.  If the Guarantor
receives any payment or other benefit or exercises any set-off or counterclaim
or otherwise acts in breach of this Section 1.6, anything so received
and any benefit derived directly or indirectly by the Guarantor therefrom shall
be held on trust for the Holders to be applied ratably in discharge of the
liability of the Guarantor to the Holders hereunder.


 


1.7.                            Suspense
Account and Application.


 


(a)                                 Suspense
Account.   Any money received by a Holder in connection
with this Guarantee may be placed to the credit of an interest bearing suspense
account with a view to preserving the rights of such Holder to prove for the
whole of its claims against the Company or any other Subsidiary Guarantor liable
or may be applied by such Holder in or towards satisfaction of such of the
moneys, obligations or liabilities of the Company hereby guaranteed as such
Holder in such Holder’s absolute discretion may, subject to Section 1.7(b),
from time to time conclusively determine. 
The amount standing to the credit of the suspense account shall attract
interest at such reasonable market rates offered by leading banks in the London
Interbank Market for deposits in the same currency and for each successive
period of one month (or such shorter period as the amount is to be retained on
such account) as shall be available to the Holder.


 


(b)                                 Application.   The Guarantor
shall have no right to require that any sums received by a Holder from the
Guarantor under, or pursuant to, the terms of this Guarantee should be applied
at any particular time or times (provided that
in the event that the aggregate amount of any such sums received by such Holder
and interest accrued in respect of moneys on deposit in any such suspense account
referred to in Section 1.7(a) (or the equivalent provision of any Subsidiary
Guarantee) shall be equal to or in excess of the entire outstanding Guaranteed
Obligations owing to such Holder, then such Holder shall apply such amounts in
satisfaction of such Guaranteed Obligations).


 

















 


1.8.                             Discharge
to be Conditional.


 


Any release, discharge,
settlement or arrangement on the faith of any security, disposition or payment
between the Guarantor and a Holder shall be conditional upon no security,
disposition or payment to any of the Holders by the Company or any other Person
(not being the Guarantor) being void, set aside or ordered to be refunded
pursuant to any enactment or law relating to bankruptcy, liquidation or
insolvency or for any reason whatever and, if such condition shall not be
fulfilled, each Holder shall be entitled to enforce this Guarantee subsequently
as if such release, discharge or settlement had not occurred and any such
payment had not been made.


 


1.9.                            Enforcement.


 


A Holder shall not be
obliged before taking steps to enforce this Guarantee: (a) to take action or
obtain judgment in any court against the Company or any other Person; or (b) to
make, enforce or seek to enforce any claim against the Company or any other
Person under any security or other document, agreement or arrangement.


 


1.10.                     Payment
and Withholdings.


 


All sums due and payable by
the Guarantor under this Guarantee shall be made in full without set-off or
counterclaim and free and clear of and (subject as provided in the next
sentence) without deduction for or on account of any future or present Tax. If: 


 


(a)                                  the Guarantor is required by law to make any
deduction or withholding from any sum payable by the Guarantor to a Holder
hereunder; or 


 


(b)                                 a Holder is required by law to make any
payment, on account of any Tax or otherwise, on or in relation to any amount
received or receivable by such Holder hereunder,


 


(excluding, in the case of each Holder, taxes imposed on its overall
net income, profits or gains, and franchise taxes imposed on such Holder, by
the jurisdiction under the laws of which such Holder is organized or any
political subdivision thereof) then the sum payable by the Guarantor in respect
of which such deduction, withholding or payment is required to be made shall be
increased to the extent necessary to ensure that, after the making of such
deduction, withholding or payment (and after taking account of any deduction,
withholding or payment which is required to be made as a result of the
increase), such Holder receives and retains a net sum equal to the sum which it
would have received and so retained had no such deduction, withholding or
payment been made; provided that
each


 

















 


Holder will comply with any
reasonable request of the Guarantor to comply with any form filing or similar
reporting requirement to reduce such deduction, withholding or payment within
60 days of the Guarantor providing written notice to the Holder of such filing
or similar reporting requirement, so long as any required forms and accompanying
instructions issued by the relevant taxing authority are provided to the Holder
along with such written notice.  The
foregoing notwithstanding, nothing in this Section 1.10 shall (i) restrict the
right of any Holder to arrange its tax affairs as it shall think fit, (ii)
require any Holder to disclose any information regarding its tax affairs which,
in such Holder’s reasonable and good faith judgment, constitutes confidential
or proprietary information, or (iii) subject to the paragraph below, require any
Holder to account for any indirect taxation benefits arising from the
deduction, withholding or payment of any Tax. 
The obligations of the Guarantor under this Section 1.10 will survive
the payment or transfer of any Note and the termination of this Guarantee.


 


Each Holder agrees that,
with reasonable promptness after receiving written notice from the Guarantor to
the effect that such Holder is eligible for a refund in respect of Taxes
actually paid by the Guarantor, such Holder will sign and deliver to or as
reasonably directed by the Guarantor any Form provided to such Holder by the
Guarantor to enable such Holder to obtain a refund in respect of such Taxes;
and if such Holder thereafter receives such refund in respect of such Taxes,
such Holder will promptly pay such refund to the Guarantor (together with
interest, if any, received by such Holder from the relevant taxing
authority).  If a Holder applies for a
refund of such Taxes prior to a request by the Guarantor to apply for such a
refund, upon receipt of a request by the Guarantor to apply for a refund or to
turn over the proceeds of any such refund, the Holder will pay any such refund
to the Guarantor (together with interest, if any, received by such holder from
the relevant taxing authority) promptly upon receipt of such refund, or if
later, promptly upon receipt of the request from the Guarantor.  The Guarantor agrees to pay all reasonable
out-of-pocket expenses incurred by a Holder in connection with obtaining such
refund.


 


1.11.                     Joint and
Several Liability.


 


The Guarantor acknowledges
and agrees that its liabilities under this Guarantee and the liabilities of
each other Subsidiary Guarantor under their respective Subsidiary Guarantees
are joint and several.  Without limiting
the generality of the foregoing, the Guarantor waives any rights which it may
have under the existing or future laws of Guernsey in relation to any
obligation assumed by it under this Guarantee arising by virtue of the “droit
de discussion” and “droit de division”.


 

















 


1.12.                   Severability.


 


The rights of the Holders
under this Guarantee are several and each Holder may separately enforce its
rights under this Guarantee.


 


1.13.                     Survival.


 


So long as the Guaranteed
Obligations have not been discharged in full, the obligations of the Guarantor
under this Guarantee shall survive the transfer and payment of any Note.


 


1.14.                     Payments
on Guaranteed Obligations.


 


The Guarantor will make all
payments in respect of this Guarantee to the holders in the same manner and in
the same currency as the Company is required to make payments on the Notes in
accordance with Section •
of the Amended and Restated Note Purchase Agreement.


 


1.I5.                       Termination, etc.


 


Nothing shall discharge or
satisfy the obligations of the Guarantor hereunder except the full and final
performance and payment of the Guaranteed Obligations.


 


1.16.                 Enforcement
by Holders.


 


For the purposes of the
Contracts (Rights of Third Parties) Act 1999 (the “Contracts Act”), this Guarantee may be enforced by, and will
confer benefits on, each of the present and future Holders of each of the
Notes; provided, that, for
amendments and waivers as provided in Section 6.1, the consent of the Holder or
Holders at the time of that amendment and/or waiver shall be required, but not
the consent of any future Holders.


 


1.17.                 Indemnity.


 


The Guarantor irrevocably
and unconditionally indemnifies as primary obligor each Holder on demand
against any loss or liability suffered by it if any Guaranteed Obligation is or
becomes unenforceable, invalid or illegal.


 


2.     REPRESENTATIONS AND WARRANTIES OF THE
GUARANTOR.


 


The Guarantor represents and
warrants for the benefit of each of the Holders:


 

















 


2.1.                            Representations
and Warranties in Amended and Restated Note Purchase Agreement.


 


Without in any way limiting
the generality of the warranties and representations contained in Section • of the Amended and Restated Note Purchase
Agreement, each of such warranties and representations is, insofar as it is
expressed to apply to a Subsidiary or a Guarantor specifically or to any
Subsidiary generally, true and correct, as of the date hereof, with respect to
the Guarantor.


 


2.2.                             Warranties
and Representations with
Respect to the  Guarantor
and this Guarantee.


 


(a)                                 Organization;
Power and Authority.  The
Guarantor is a corporation duly organized and validly existing under the laws
of its jurisdiction of incorporation, and is duly qualified as a foreign
corporation and (to the extent such concept is recognized in such
jurisdictions) is in good standing in each jurisdiction in which such
qualification is required by law, other than those jurisdictions as to which
the failure to be so qualified or in good standing could not, individually or
in the aggregate, reasonably be expected to have a Material Adverse Effect.  The Guarantor has the corporate power and
authority to own or hold under lease the properties it purports to own or hold
under lease, to transact the business it transacts and, as described in the
Information Pack, proposes to transact, to execute and deliver this Guarantee
and to perform the provisions hereof.


 


(b)                                 Authorisation,
etc.  This Guarantee has been duly authorised by all necessary corporate
action on the part of the Guarantor, and this Guarantee constitutes a legal,
valid and binding obligation of the Guarantor enforceable against the Guarantor
in accordance with its terms except as provided in the Reservations.


 


(c)                                  Compliance
with Laws, Other Instruments, etc.  The execution, delivery and performance by
the Guarantor of this Guarantee will not:


 


(i)                                     contravene, result in any breach of, or
constitute a default under, or result in the creation of any Lien in respect of
any property of the Guarantor under, any indenture, mortgage, deed of trust,
loan, purchase or credit agreement, lease, memorandum or articles of
association, corporate charter or by-laws, or any other agreement, instrument
or license to which the Guarantor is bound


 

















 


or subject or by which the
Guarantor or any of its  properties
may be bound or affected,


 


(ii)                                  conflict with or result in a breach of any of
the terms, conditions or provisions of any order, judgment, decree, or ruling
of any court, arbitrator or Governmental Authority applicable to the Guarantor,
or


 


(iii)                               violate any provision of any applicable law
or other rule or regulation of any Governmental Authority applicable to the
Guarantor.


 


(d)                                 Governmental
Authorisations, etc.   No consent, approval or authorisation of, or
registration, filing or declaration with, any Governmental Authority is
required in connection with the execution, delivery or performance by the
Guarantor of this Guarantee, save as may be required under sections 155 through
158, inclusive, of the Companies Act.


 


(e)                                  Pari Passu
Ranking.   The Guarantor’s obligations under this
Guarantee will rank at least pari passu,
without preference or priority, with all of its other outstanding unsecured and
unsubordinated obligations, except for those obligations that are mandatorily
preferred by law and not by reason of contract.


 


(f)                                    Solvency
of Guarantor.  The Guarantor, after giving effect to the
transactions contemplated by this Guarantee, will not be unable to pay its
debts (within the meaning of Section 123(1)(a) or (e) or Section 123(2) of the
Insolvency Act).


 


3.    COVENANTS.


 


3.1.  Covenants in Amended and Restated Note
Purchase Agreement.


 


The Guarantor will comply
with each of the provisions of Section •, Section • and Section • of the Amended and Restated Note Purchase
Agreement in so far as those provisions are expressed to apply to a Subsidiary
or a Guarantor specifically or to any Subsidiary generally.


 


3.2.  Pari
Passu Ranking.


 


The Guarantor shall ensure
that its obligations under this Guarantee will at all times rank at least pari passu in all respects with the claims
of all of its other unsecured creditors save those whose claims are preferred
by any


 

















 


bankruptcy, receivership,
insolvency, liquidation or other similar laws of general application.


 


4.    TRANSACTION EXPENSES.


 


The Guarantor will pay all
costs and expenses (including, without limitation, reasonable attorneys’ fees
of a special United States counsel and a special English counsel and, if
reasonably required, other local counsel) incurred by each Holder in connection
with this Guarantee and in connection with any amendments, waivers or consents under
or in respect of this Guarantee (whether or not such amendment, waiver or
consent becomes effective), including, without limitation: (a) the costs and
expenses incurred in enforcing or defending (or determining whether or how to
enforce or defend) any rights under this Guarantee, the Amended and Restated
Note Purchase Agreement, or the Notes or in responding to any subpoena or other
legal process or informal investigative demand issued in connection with this
Guarantee, the Amended and Restated Note Purchase Agreement, or the Notes; and
(b) the costs and expenses, including, without limitation, financial advisors’
and reporting or investigating accountants’ fees, incurred in connection with
the insolvency or bankruptcy of the Guarantor or in connection with any
work-out or restructuring of the transactions contemplated by this Guarantee,
the Amended and Restated Note Purchase Agreement, or the Notes. The Guarantor
will pay, and will save each Holder and hold each Holder harmless from, all
claims in respect of any fees, costs or expenses if any, of brokers and finders
(other than those retained by such Holder).


 


5.    SURVIVAL OF REPRESENTATIONS
AND WARRANTIES; ENTIRE AGREEMENT.


 


All representations and
warranties contained herein shall survive the execution and delivery of this
Guarantee, the purchase or transfer by any Noteholder or other Holder of any
Note or portion thereof or interest therein and the payment of any Note, and
may be relied upon by any Holder, regardless of any investigation made at any time
by or on behalf of any Noteholder or any other Holder (it being understood that
all representations and warranties of the Guarantor contained in this Guarantee
are made only as of the date hereof). 
All statements contained in any certificate or other instrument
delivered by or on behalf of the Guarantor pursuant to this Guarantee or the
Amended and Restated Note Purchase Agreement shall be deemed representations
and warranties of the Guarantor under this Guarantee (and deemed made at the
time of the delivery of such certificate or other instrument if such delivery
is after the date hereof). Subject to the preceding sentence, this Guarantee
embodies the final expression of all of the terms hereof and is a complete and
exclusive statement of those terms.


 

















 


6.    AMENDMENT
AND WAIVER.


 


6.1.  Requirements.


 


This Guarantee may be
amended, and the observance of any term hereof may be waived (either
retroactively or prospectively), with (and only with) the written consent of
the Guarantor and the Required Holders except that no such amendment or waiver
may, without written consent of the Holder or Holders of each of the Notes at
the time outstanding affected thereby, (a) change the percentage of the
principal amount of the Notes the Holders of which are required to consent to
any such amendment or waiver, or (b) amend any of Section 1, Section 2 or this
Section 6.


 


6.2.  Solicitation of Holders of Notes.


 


(a)                                 Solicitation.  The Guarantor
will provide each Holder (irrespective of the amount of Notes then owned by it)
with sufficient information, sufficiently far in advance of the date a decision
is required, to enable such Holder to make an informed and considered decision
with respect to any proposed amendment, waiver or consent in respect of any of
the provisions hereof.   The Guarantor
will deliver executed or true and correct copies of each amendment, waiver or
consent effected pursuant to the provisions of this Section 6 to each Holder of
outstanding Notes promptly following the date on which it is executed and
delivered by, or receives the consent or approval of, the requisite Holders.


 


(b)                                 Payment.  The Guarantor
will not directly or indirectly pay or cause to be paid any remuneration,
whether by way of supplemental or additional interest, fee or otherwise, or
grant any security, to any Holder as consideration for or as an inducement to
the entering into by any Holder of any waiver or amendment of any of the terms
and provisions hereof unless such remuneration is concurrently paid, or
security is concurrently granted, on the same terms, ratably to each Holder
holding Notes then outstanding even if such Holder did not consent to such
waiver or amendment.


 


6.3.  Binding
Effect, etc.


 


Any amendment or waiver
consented to as provided in this Section 6 applies equally to all Holders and
the Guarantor without regard to whether any Note held by any Holder has been
marked to indicate such amendment or waiver. 
No such amendment or waiver will extend to or affect any obligation,
covenant, agreement, Default or Event of Default not expressly amended or
waived or impair any right consequent thereon. 
No course of dealing between the Guarantor and any Holder nor any delay
in exercising any rights hereunder or under any


 

















 


Note shall operate as a waiver of any rights of such Holder.  As used herein, the term “this Guarantee” and references thereto
shall mean this Guarantee as it may from time to time be amended or
supplemented.


 


6.4.  Notes held by Guarantor, etc.


 


Solely for the purpose of
determining whether Holders holding the requisite percentage of the aggregate
principal amount of Notes then outstanding approved or consented to any
amendment, waiver or consent to be given under this Guarantee, or have directed
the taking of any action provided herein to be taken upon the direction of
Holders holding a specified percentage of the aggregate principal amount of
Notes then outstanding, Notes directly or indirectly owned by the Guarantor,
the Company, any other Subsidiary or any of their respective Affiliates shall
be deemed not to be outstanding.


 


7.    NOTICES.


 


All notices and
communications provided for hereunder shall be in writing and sent (a) by
facsimile if the sender on the same day sends a confirming copy of such notice
by an internationally-recognized expedited delivery service (charges prepaid),
or (b) by an internationally-recognized expedited delivery service (with
charges prepaid).  Any such notice must
be sent:


 


(i)                                     if
to any Holder or such Holder’s nominee, to such Holder or such Holder’s nominee
at the address specified for such communications pursuant to Section • of the Amended and
Restated Note Purchase Agreement; or


 


(ii)                                  if to the Guarantor, to the Guarantor at:


 


c/o Spirent plc

Gatwick Road

Crawley

West Sussex RH10 2RZ,

England

Attention: Chief Financial Accountant

facsimile no.: [+44-1293-527507]


 


or at such other address as
the Guarantor shall have specified to each Holder in writing.


 


Notices under this Section 7 will be deemed given only when actually
received.


 

















 


8.  INTERPRETATION OF THIS GUARANTEE.


 


8.1.   Defined
Terms.  Certain capitalized terms and other terms
used in this Guarantee have the following meanings:


 


Amended and Restated Note Purchase Agreement –  is defined in Recital (A).


 


Company –
is defined in Recital (A).


 


Contracts Act – is defined in Section 1.16.


 


Guarantee, this – is defined in Section 6.3. 


 


Guaranteed Obligations – is defined in Section 1.1(b). 


 


Guarantor – is defined in the introduction hereof. 


 


Holder –
is defined in the introduction hereof.


 


Limitation Act  – means the Limitation Act 1980 of the United
Kingdom, as amended from time to time.


 


Noteholder – is defined in Recital (A).


 


Notes – is defined in Recital (A).


 


Reservations – means, with respect to the enforceability of any agreement or
instrument, any limitations on such enforceability that may be imposed by (a)
applicable bankruptcy, insolvency, reorganization, moratorium or other similar
laws affecting the enforcement of creditors’ rights generally, or (b) general
principles of equity (regardless of whether such enforceability is considered
in a proceeding in equity or at law).


 


Subsidiary Guarantor – means a Subsidiary of the Company that is for
the time being a “Guarantor” as such term is defined in the Amended and Restated Note Purchase Agreement.


 


8.2.  Amended and Restated Note Purchase
Agreement.  Capitalized terms used herein and not
otherwise defined in Section 8.1 shall have  the
respective meanings set forth in the Amended and Restated Note Purchase
Agreement.


 


8.3.  Interpretation.  In this Guarantee (unless otherwise
provided):


 

















 


(a)                                  words importing the singular shall include
the plural and vice versa;


 


(b)                                  references to any document shall be construed
as references to that document, as amended, varied, novated or supplemented, as
the case may be;


 


(c)                                  references to any statute or statutory
provision include any statute or statutory provision which amends, extends,
consolidates or replaces the same, or which has been amended, extended,
consolidated or replaced by the same, and shall include any orders,
regulations, instruments or other subordinate legislation made under the
relevant statute;


 


(d)                                  references to “assets” or “property”
or “properties” shall include
revenues and the right to revenues, and all personal property, assets and
rights of every kind, whether present, future or contingent, and whether
tangible or intangible, choate or inchoate (including uncalled share capital);


 


(e)                                  the words “including”
and “in particular” shall be
construed as being by way of illustration or emphasis only and shall not be
construed as, nor shall they take effect as, limiting the generality of any
foregoing words;


 


(f)                                    the words “other”
and “otherwise” shall not be
construed ejusdem generis with
any foregoing words where a wider construction is possible;


 


(g)                                 references to a “corporation” shall include a corporation, incorporated
company or other entity substantially similar to a corporation, whether or not
called a “corporation” under the laws of (or in business terminology commonly
used in) the jurisdiction where such entity is organized or conducts its
primary business;


 


(h)                                 references to a “Person” shall be construed as to include that person’s
assigns, transferees or successors in title and shall be construed as including
references to an individual, partnership, corporation, limited liability
company, firm, association, joint venture, trust, unincorporated organization,
or a government or agency or political subdivision thereof;


 


(i)                                    references to Sections and Recitals are,
unless otherwise specified, references to Sections and Recitals of this
Guarantee.


 

















 


9.  MISCELLANEOUS.


 


9.1.  Successors and Assigns.


 


Whenever the Guarantor is
referred to, such reference shall be deemed to include the successors and
assigns of the Guarantor, and all the covenants, promises and agreements
contained in this Guarantee by or on behalf of the Guarantor shall bind the
successors and assigns of the Guarantor and shall inure to the benefit of each
of the Holders whether so expressed or not and whether or not an assignment of
the rights hereunder shall have been delivered in connection with any
assignment or other transfer of Notes.


 


9.2.  Severability.


 


Any provision of this
Guarantee that is prohibited or unenforceable in any jurisdiction shall, as to
such jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof, and any
such prohibition or unenforceability in any jurisdiction shall (to the full
extent permitted by law) not invalidate or render unenforceable such provision
in any other jurisdiction.


 


9.3.  Reproduction of Documents.


 


The Guarantor agrees that
the provisions of Section • of the Amended and Restated Note Purchase Agreement shall apply to the
Guarantor mutatis mutandis as if
such Section were set forth in this Guarantee.


 


9.4.  Waiver
of Defences.


 


The obligations of each
Guarantor will not be affected by an act, omission, matter or thing which, but
for this provision, would reduce, release or prejudice any of its obligations
under this Guarantee or prejudice or diminish those obligations in whole or in
part, including (whether or not known to it or any Holder):


 


(a)                                  any time or waiver granted to, or composition
with, the Company or other Person;


 


(b)                                 the release of the Company or any other Person
under the terms of any composition or arrangement with any creditor or any
member of the Group;


 


(c)                                  the
taking, variation, compromise, exchange, renewal or release of, or refusal or
neglect to perfect, take up or enforce, any rights against, or security over
assets of, the Company or other Person or any non-presentation or
non-observance


 

















 


of any formality or other requirement in respect of any instrument or
any failure to realise the full value of any security;


 


(d)                                 any incapacity or lack of powers, authority
or legal personality of or dissolution or change in the members or status of
the Company or any other Person;


 


(e)                                  any variation (however fundamental) or
replacement of a Financing Document or any other document or security so  that references to that Financing
Document in this Guarantee shall include each variation or replacement;


 


(f)                                    any unenforceability, illegality or
invalidity of any obligation of any Person under any Financing Document or any
other document or security, to the intent that the Guarantors’ obligations
under this Guarantee shall remain in full force and its Guarantee be construed
accordingly, as if there were no unenforceability, illegality or invalidity; or


 


(g)                                 any postponement, discharge, reduction,
non-provability or other similar circumstance affecting any obligation of the
Company under a Financing Document resulting from any insolvency, liquidation
or dissolution proceedings or from any law, regulation or order so that each
such obligation shall for the purposes of each Guarantor’s obligations under
this Guarantee be construed as if there were no such circumstances.


 


9.5.  Governing
Law.


 


THIS
GUARANTEE SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, AND THE RIGHTS OF
THE GUARANTOR AND THE HOLDERS SHALL BE GOVERNED BY, ENGLISH LAW.


 


9.6.  Jurisdiction.


 


(a)                                 Courts of
England.  THE COURTS OF ENGLAND SHALL
HAVE JURISDICTION TO SETTLE ANY DISPUTES WHICH MAY ARISE OUT OF OR IN
CONNECTION WITH THIS GUARANTEE.


 


(b)                                 Other
Jurisdictions.  THE PROVISIONS OF SECTION
9.6(a) ARE FOR THE BENEFIT OF THE HOLDERS ONLY AND ARE WITHOUT PREJUDICE TO THE
RIGHTS OF HOLDERS TO BRING


 

















 


ANY
PROCEEDINGS RELATING TO THIS GUARANTEE IN ANY OTHER COURT WHICH HAS COMPETENT
JURISDICTION.


 


(c)                                    Certain
Waivers and Consents.  FOR THE PURPOSES OF THIS
GUARANTEE, THE GUARANTOR HEREBY (I) WAIVES ANY OBJECTIONS TO THE COURTS OF
ENGLAND HAVING JURISDICTION ON THE GROUNDS OF VENUE OR FORUM NON-CONVENIENS OR ANY SIMILAR
GROUNDS, AND (II) CONSENTS TO SERVICE OF PROCESS BY MAIL OR IN ANY OTHER MANNER
PERMITTED BY RELEVANT LAW.


 


IN WITNESS
WHEREOF, the
Guarantor has executed and delivered this Guarantee as a deed on the day and
year first above written.


 


 


	
  EXECUTED and DELIVERED as

  	
  )

  
	
   

  	
   

  
	
  a deed by [GUARANTOR] acting

  	
  )

  
	
   

  	
   

  
	
  by two Directors or one Director

  	
  )

  
	
   

  	
   

  
	
  and its Secretary

  	
  )

  
	
   

  	
   

  



 


 


Director


 


 


Director/Secretary


 

















 


EXHIBIT 4.9


 


BANKS’ TERM SHEET


 


 


[To be attached.]


 

















 


DRAFT 11: 20th February, 2003


 


PROJECT
CONKER


 


Summary of
Terms and Conditions

Amendments to Senior Credit Facility


 


	
  Borrower:

  	
  Spirent plc (“Spirent or the Parent”) plus additional Borrowers as
  per the Existing Facility.

  
	
   

  	
   

  
	
  Existing Facility:

  	
  The syndicated credit facility dated 14th June 1999 in an
  original amount of £315 million and US$200 million as amended.

  
	
   

  
	
   

  	
   

  
	
  Reduction in Existing

  Facility:

  	
  Existing Facility currently of US$112 million and £100 million to be
  reduced to £75 million on the Effective Date as follows:

  
	
   

  	
   

  
	
   

  	
  Tranche A – Revolving Credit Facility to be cancelled.

  
	
   

  	
   

  
	
   

  	
  Tranche B - £75 million Revolving Credit Facility

  
	
   

  	
   

  
	
   

  	
  Effective Date means the date on which completion of the
  disposal by the Borrower of its interest in the WAGO Joint Venture (Project Schultz) has become wholly
  unconditional and all other consents, permissions and waivers (including the
  conditions precedent set out below have been satisfied.

  
	
   

  
	
   

  
	
   

  
	
   

  	
   

  
	
   

  	
  All consents and waivers required under the Existing Facility in
  respect of Project Schultz will be given as of the Effective Date. On the
  Effective Date, the Borrower shall have to repay and cancel:

  
	
   

  
	
   

  
	
   

  	
   

  
	
   

  	
  1.

  	
  all existing drawings under Tranche A (and all Tranche A commitments
  will be cancelled) from the application of an aggregate of £70 million of
  cash held on balance sheet; and

  
	
   

  
	
   

  
	
   

  	
  2.

  	
  any surplus cash after repayment of Tranche A shall be applied to
  repay drawings under Tranche B. Those amounts so repaid under Tranche B are
  available for redrawing, provided that the aggregate amount drawn under
  Tranche B shall not exceed the reduced Tranche B commitment amount of £75
  million.

  
	
   

  
	
   

  
	
   

  
	
   

  	
   

  
	
   

  	
  At any time the providers of the private placement notes issued under
  the note purchase agreements dated 23rd November, 1999 are referred to as the
  Noteholders.

  
	
   

  
	
   

  
	
  Co-ordinator and Facility

  Agent:

  	
  HSBC Bank plc.

  
	
   

  
	
   

  
	
  Lenders:

  	
  The lenders in the Existing Facility.

  
	
   

  	
   

  
	
  Final Maturity Date:

  	
  As defined in the Existing Facility.

  



 

















 


	
  Terms to be Amended:

  	
  The following terms and conditions of the Existing Facility shall he
  amended, subject to the provisions of “Security Interests and Other
  Covenants” below.

  
	
   

  
	
   

  	
   

  
	
  Financial Covenants:

  	
  To be amended as follows with effect from the 31st March 2003 test
  date:

  
	
   

  	
   

  
	
   

  	
  Interest Cover

  
	
   

  	
  Ratio of Consolidated EBITA to Consolidated Net Interest Expense to
  be not less than the following ratios as at the dates set out below:

  
	
   

  	
   

  
	
   

  	
  Ratio

  	
  Date

  
	
   

  	
  2.0:1

  	
  31st March 2003 test date

  
	
   

  	
  2.0:1

  	
  30th June 2003
  test date

  
	
   

  	
  2.25:1

  	
  30th September test date

  
	
   

  	
  2.5:1

  	
  31st December
  2003 test date

  
	
   

  	
  2.5:1

  	
  31st March 2004 test date

  
	
   

  	
  2.5:1

  	
  thereafter

  
	
   

  	
   

  
	
   

  	
  Debt:
  EBITDA

  
	
   

  	
  Ratio of Consolidated Net
  Debt to Consolidated EBITDA not to exceed the following ratios at the dates
  set out below:

  
	
   

  	
   

  
	
   

  	
  Ratio

  	
  Date

  
	
   

  	
  3.0:1

  	
  31st March 2003 test date

  
	
   

  	
  2.75:1

  	
  30th June 2003
  test date

  
	
   

  	
  2.5:1

  	
  30th September test date

  
	
   

  	
  2.25:1

  	
  31st December
  2003 test date

  
	
   

  	
  2.25:1

  	
  31st March 2004 test date

  
	
   

  	
  2.25:1

  	
  thereafter

  
	
   

  	
   

  
	
   

  	
  Consolidated Net Worth

  
	
   

  	
  The following financial covenant will be added:

  
	
   

  	
   

  
	
   

  	
  Consolidated Net Worth shall at no time be less than £100,000,000.
  (Definition of Consolidated Net Worth and other financial covenant
  definitions to be consistent with, and determined on a consistent basis with,
  equivalent provisions in favour of Noteholders).

  
	
   

  
	
   

  
	
   

  
	
   

  	
   

  
	
  Other Covenants:

  	
  The following covenants shall be added or amended as applicable:

  
	
   

  
	
   

  	
  1.

  	
  Preferred Indebtedness - existing Clause 19.8 (Preferred
  Indebtedness) to be amended to provide that the Borrower shall procure that
  Preferred Indebtedness does not at any time exceed £30,000,000 (or its
  equivalent in any other currency or currencies).  (Preferred Indebtedness definition to be consistent with
  definition of “Total Subsidiary Debt” for the Noteholders, but shall include
  all secured indebtedness of the Obligors and retain the exceptions in the
  current definition of “Preferred Indebtedness”).

  
	
   

  
	
   

  
	
   

  
	
   

  
	
   

  
				



 


2

















 


	
   

  	
  2.

  	
  Dividends and Distributions - a covenant shall be added to restrict
  Obligors from paying, making or declaring any dividends or distributions
  (subject to certain intra-Group exceptions and payments to certain
  Subsidiaries that are not wholly-owned).

  
	
   

  
	
   

  
	
   

  	
   

  
	
   

  	
  3.

  	
  Disposals - the existing Clause 19.9 (Disposals) shall be amended so that the
  Borrower shall be prohibited from disposing of any interest in the Network
  Products Division and/or the Systems-Drive Division and shall be prohibited
  from disposing of any other assets except for certain immaterial real
  property no longer required for the operation of the Company’s
  business and subject to other limited exceptions
  to be agreed.

  
	
   

  
	
   

  
	
   

  
	
   

  
	
   

  	
   

  
	
   

  	
  4.

  	
  Acquisitions - the existing Clause 19.11 (Acquisitions)
  shall be amended to provide that no member of the Group may make any
  acquisition other than:

  
	
   

  
	
   

  	
   

  
	
   

  	
   

  	
  (a)

  	
  acquisitions in
  the ordinary course of business and to allow other customary exceptions to
  permit the Group to operate its business;

  
	
   

  
	
   

  	
   

  
	
   

  	
   

  	
  (b)

  	
  in respect of acquisitions completed
  before the Effective Date and disclosed to the Lenders for which deferred
  consideration is payable; and

  
	
   

  
	
   

  	
   

  
	
   

  	
   

  	
  (c)

  	
  acquisitions
  with an aggregate consideration of up to £2,500,000 per annum.

  
	
   

  	
   

  
	
   

  	
   

  	
  The Clause will also be amended to provide that no member of the
  Group may make any acquisition if there is an Event of Default (or an
  Event of Default would arise as a result of the acquisition).

  
	
   

  
	
   

  
	
   

  	
   

  
	
   

  	
  5.

  	
  Negative Pledge - in addition to the Preferred Indebtedness provisions, no security
  to be given to the Noteholders or to any provider of external debt financing
  providing debt of not less than £50 million which matures no earlier than
  31st March, 2006 (Medium Term Financiers)
  unless the Lenders are given equal and rateable security reasonably
  satisfactory to them.

  
	
   

  
	
   

  
	
   

  
	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  6.

  	
  Reduction in Tranche B - by no later than 31st December, 2003,
  the Tranche B commitments shall be reduced to £60 million and cancelled to
  the extent of such reduction. To the extent that drawings under Tranche B are
  outstanding on the date of reduction in Tranche B commitments, such drawings
  shall be repaid on that date by the Borrower.

  
	
   

  
	
   

  
	
   

  
	
   

  



 


3

















 


	
   

  	
  7.

  	
  Material Adverse Effect - the definition of Material Adverse
  Effect shall be amended as follows:

  
	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  ““Material Adverse Effect”

  
	
   

  	
   

  
	
   

  	
   

  	
  means a material adverse
  effect on:

  
	
   

  	
   

  
	
   

  	
   

  	
  (a)

  	
  since the Effective Date, the business or financial condition of the
  Group as a whole; or

  
	
   

  
	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (b)

  	
  the ability of the Company to perform any of its payment obligations
  under the Finance Documents or any of its obligations under Clause 19.10
  (Financial Covenants).”

  
	
   

  
	
   

  
	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Events of Default:

  	
  Effectiveness of Guarantee - Clause 20.14 (Effectiveness of
  Guarantee) shall be amended so that the exception at the end of that Clause
  (from “and, in the case of" through to the end of that Clause) shall be
  deleted.

  
	
   

  
	
   

  
	
   

  
	
  Representations and

  Warranties:

  	
  Customary for a facility of this type, including a representation and
  warranty by the Borrower as to the accuracy in all material respects of all
  information provided to the Lenders in the Initial Information Memorandum, dated
  December 18, 2002 and the Supplementary Information Memorandum, dated January
  13, 2003 except for the forecasts and projections contained therein (in each
  case except as may have been supplemented in writing prior to the date of the
  amendment facility document).  The
  Borrower will also represent that all information provided therein to the
  Lenders that constituted forecasts or projections relating to the Group was
  based in all material respects on information that the Borrower believed to
  be complete and accurate at the time of the preparation thereof and were made
  on the basis of assumptions and estimates which the Borrower believed were
  reasonable in view of the circumstances existing at the time such assumptions
  and estimates were made.

  
	
   

  
	
   

  
	
   

  
	
   

  
	
   

  
	
   

  
	
   

  
	
   

  
	
   

  
	
   

  	
   

  
	
  Applicable Margin:

  	
  Applicable Margin to be increased to 1.75% for the period from the
  signing of an amendment agreement to date of delivery of a compliance
  certificate in respect of the June 2003 Financial Covenant test date.

  
	
   

  	
  Thereafter the Applicable Margin will be determined by reference to
  the ratio of Spirent’s Total Consolidated Net Debt (“Net Debt”) to EBITDA as
  below:

  
	
   

  	
   

  
	
   

  	
  Net Debt:
  EBlTDA Ratio

  	
  Applicable
  Margin

  
	
   

  	
  >2.0x

  	
  1.75% p.a.

  
	
   

  	
  <2.0x & >
  1.5x

  	
  1.65% p.a.

  
	
   

  	
  <1.5x & >1.0x

  	
  1.575% p.a.

  
	
   

  	
  <1.0x

  	
  1.50% p.a.

  
					



 


4

















 


	
  Commitment Fee:

  	
  50 per cent, of the Applicable Margin (subject to a cap of 0.75 per
  cent, per annum) payable on the unused and uncancelled amount of the Facility
  for the availability period.  Accrued
  commitment fee is payable quarterly in arrears during the availability
  period.

  
	
   

  
	
   

  
	
   

  	
   

  
	
  Purpose:

  	
  The Facility shall not be used to finance any principal repayment or
  make-whole repayment to the Noteholders under the note purchase agreements
  dated 23rd November, 1999 (as amended or replaced).

  
	
   

  
	
   

  
	
   

  
	
  Amendment Fee:

  	
  An amendment fee of 0.40% flat calculated on each Lender’s pro-rata
  commitment to the currently drawn facility amount and shall be payable to the
  Lenders upon signing of an amendment agreement.

  
	
   

  
	
   

  
	
   

  
	
  Guarantees:

  	
  The Borrower must procure that each of its Subsidiaries as listed in
  the Schedule to these terms and conditions becomes an Additional Guarantor
  (unless it is already a Guarantor). 
  The guarantees shall rank pari
  passu with the guarantees given by the Group members to the
  Noteholders.

  
	
   

  
	
   

  
	
   

  
	
   

  
	
   

  	
  The definition of Material Subsidiary shall be amended to expressly
  include the Subsidiaries of the Borrower as listed in the Schedule to these
  terms and conditions.

  
	
   

  
	
   

  
	
   

  	
   

  
	
   

  	
  Clause 28.7 (Removal of Obligors) shall be amended to allow removal
  of Obligors who are not also Material Subsidiaries.

  
	
   

  
	
   

  	
   

  
	
  Financial information:

  	
  Clause 19.2 (Financial Information) shall be amended by adding a
  requirement on the Borrower to provide the Facility Agent (in sufficient
  copies for all the Lenders) with its monthly management accounts within 30
  days of the end of each month to which the accounts relate, as well as
  management accounts for each quarter in each of its financial years within 45
  days of the end of each such quarter and a summary and analysis of the
  Borrower’s monthly management accounts prepared by PwC on a quarterly
  basis.  The Group Finance Director of
  the Borrower will conduct a conference call with the Lenders on a quarterly
  basis to provide the Lenders with an update on the Group’s financial
  performance.

  
	
   

  
	
   

  
	
   

  
	
   

  
	
   

  
	
   

  
	
   

  



 


5

















 


	
  Security Interests and

  	
  If Spirent and/or any other Borrower grants
  any security interest,
  collateral, guarantee cover, structural preference to the Noteholders or
  providers of Financial Indebtedness (other than finance providers under
  derivative transactions on standard ISDA terms) under any other financing
  document, or grants to the Noteholders or providers of Financial Indebtedness
  (other than finance providers under derivative transactions on standard ISDA
  terms) any covenant protection which is more favourable to those Noteholders
  or providers of Financial Indebtedness (including, for the avoidance of
  doubt, financial covenants, definitions relating thereto, financial reporting
  arrangements or event of default provisions), it must at the same time grant
  the same or an equivalent security interest, collateral, guarantee cover or
  structural position or the same or equivalent covenant protection to the
  Lenders.

  
	
  Other Covenants:

  
	
   

  
	
   

  
	
   

  
	
   

  
	
   

  
	
   

  
	
   

  
	
   

  
	
   

  	
   

  
	
   

  	
  For the avoidance of doubt, notwithstanding any other provision of
  these terms and conditions, the existing covenants, Events of Default and
  representations and warranties in the Existing Facility shall be further
  amended to include or conform to the substance of any covenants,
  undertakings, events of default (however described) or representations and
  warranties in the documents amending the note purchase agreements dated 23rd
  November, 1999 (or other financing document, as applicable).

  
	
   

  
	
   

  
	
   

  
	
   

  
	
   

  
	
   

  	
   

  
	
  Conditions Precedent:

  	
  Amendments not to be effective until satisfaction of all conditions
  precedent, which will include the following:

  
	
   

  
	
   

  	
   

  
	
   

  	
  (i)

  	
  amendment of the note purchase agreements dated 23rd November, 1999
  on terms satisfactory to the Facility Agent, and notification that those
  amendments shall become effective immediately upon the amendments to the
  Existing Facility becoming effective;

  
	
   

  
	
   

  
	
   

  
	
   

  	
  (ii)

  	
  evidence of agreement of the Required Holders (as defined in the note
  purchase agreements dated 23rd November, 1999) to the transactions
  contemplated by these amendments which is deemed satisfied if (i) above
  occurs (if not earlier);

  
	
   

  
	
   

  
	
   

  	
  (iii)

  	
  payment of fees and expenses of the Finance Parties;

  
	
   

  	
  (iv)

  	
  copies of documentation relating to Project Schultz (including
  shareholder circular and sale and purchase agreement);

  
	
   

  
	
   

  	
  (v)

  	
  provision of any
  additional guarantees;

  
	
   

  	
  (vi)

  	
  legal opinions;

  
	
   

  	
  (vii)

  	
  copy of the report from
  PwC; and 

  
	
   

  	
  (viii)

  	
  copy of the working
  capital report.

  
	
   

  	
   

  
	
  Other Terms:

  	
  All other terms and conditions to be based on the existing facility
  dated 14th June 1999 as amended by a supplemental agreement dated
  15th July 1999, a syndication agreement dated 16th
  August 1999, two further supplemental agreements dated 15th
  November 2000 and one further supplemental agreement dated 6th
  March 2002.

  
	
   

  
	
   

  
	
   

  



 


6

















 


	
  Legal Advisors to the

  Lenders:

  	
  Allen & Overy

  
	
  Legal Advisors to the

  Borrowers/Guarantors:

  	
  Linklaters.

  



 


7

















 


SCHEDULE


 


Material
Subsidiaries


 


Caw Networks, Inc.
PG Drives Technology Inc.
Spirent Communications Inc.
Spirent Communications of
Rockville, Inc.
Spirent Communications GSS, Inc.
HellermannTyton Corporation
HellermannTyton Canada
Incorporated
Spirent Communications of Ottawa
Limited
PG International plc
HellermannTyton Data Limited
Spirent Communications
(Scotland) Limited
Spirent Communications (SW)
Limited
Spirent Communications Limited


 


8

















 


EXHIBIT B


 


FORM OF
NORMALIZATION CERTIFICATE


 


	
  To:

  	
   

  	
  Each of the Noteholders listed on Schedule A hereto

  
	
   

  	
   

  	
   

  
	
  From:

  	
   

  	
  Spirent plc

  



 


Date:                       


 


SPIRENT plc (formerly
BOWTHORPE plc)

Amended and Restated Note Purchase Agreement 


 


This is a Normalization
Certificate.


 


The Company hereby
represents and warrants as of the date hereof that: 


 


1.  On three consecutive Normalization Testing Dates (as such term is
defined in the Amended and Restated Note Purchase Agreement (the “Agreement”),
dated as of March 11, 2003, between Spirent plc (the “Company”) and the
Noteholders listed on Schedule A hereto; capitalized terms used herein without
definition have the respective meanings specified in the Agreement), the
Company’s ratio of Consolidated Net Debt, as of each such Normalization Testing
Date, to Consolidated EBITDA, for the Accounting Period ending on such
Normalization Testing Date, was less than 1.5 to l.0.  The relevant Normalization Testing Dates and ratios are set out
below:


 


	
   

  	
  Ratio of Consolidated Net
  Debt

  to Consolidated EBITDA

  
	
  Normalization Testing Date

  



 


2.  On the same three consecutive Normalization Testing Dates as
mentioned in paragraph 1 above, the Company’s ratio of Consolidated EBITA to
Consolidated Net Interest Expense, in each case determined for the Accounting
Period ending on such Normalization Testing Date, was in excess of 4.5 to 1.
The relevant Normalization Testing Dates and ratios are set out below:


 


	
   

  	
  Ratio of Consolidated EBITA

  to Consolidated Net Interest

  Expense

  
	
  Normalization Testing Date

  



 


3.  The Company has obtained Committed Medium-Term Financing(s) with
                  [fill
in name(s) of bank(s)   /   financial institution(s)],
with a maturity / maturities of no earlier than March 31, 2006, providing for
aggregate total commitments of not less than


 

















 


£50,000,000. The principal
terms and conditions of such Committed Medium-Term Financing(s) are set out on
Schedule B hereto.


 


4.  No Default or Event of Default has occurred which is continuing.


 


Schedule C contains supporting calculations in reasonable detail with
respect to the representations and warranties contained in paragraphs 1 and 2
hereof.


 


	
   

  	
  SPIRENT PLC

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  [group finance director]

  
						



 

















 


Schedule A


 


Metropolitan Life Insurance
Company


 


One Madison Investments
(Cayco) Limited


 


Metropolitan Insurance and
Annuity Company


 


Metropolitan Property and
Casualty Insurance Company


 


Teachers Insurance and
Annuity Association of America


 


The Lincoln National Life
Insurance Company


 


Lincoln Life & Annuity
Company of New York


 


First Penn-Pacific Life
Insurance Company


 


The Travelers Insurance
Company


 


Primerica Life Insurance
Company


 


Connecticut General Life
Insurance Company


 


Life Insurance Company of
North America


 


Massachusetts Mutual Life
Insurance Company


 


Swiss Re Life & Health
America Inc.


 


 


[To be updated as required
at the time of delivery to

accurately reflect the Noteholders at such time.]


 

















 


Schedule B


 


[to be provided by the Company]


 

















 


Schedule C


 


[to be provided by the Company]


 














  



 
 

SCHEDULE B    
    
    DEFINED TERMS    
    



        As used herein, the following terms have the respective meanings set forth below or set forth in the Section hereof following such term: 


        Acceptable State—means Canada, the United States of America (including any state thereof and the District of Columbia), the
United Kingdom, France, Germany, the Netherlands, Luxembourg, and Guernsey. 


        Accounting Period—means, at any time: 



        (a)   in
respect of the Group, (a) prior to the Normalization Date, any period of twelve months ending on the last day of a financial quarter of the Group, and
(b) on and after the Normalization Date, any period of twelve months ending on the last day of a financial year or financial half-year of the Group; 


        (b)   for
purposes of Section 5.4 and Section 7.2(c), in respect of the Company or any Material Subsidiary, any period of twelve consecutive months ending on the
last day of a financial year or financial half-year of the Company or such Material Subsidiary (as applicable); 



        (c)   for
purposes of the definition of "Normalization Conditions", in respect of the Company, any period of twelve consecutive months ending on the last day of a financial
quarter of the Company; 


        (d)   for
purposes of Section 10.11(b), in respect of the Company, any twelve month period ending on the applicable Testing Date. 




        Accounts—means: 



        (a)   in
respect of any Accounting Period of the Group, the consolidated balance sheet and profit and loss account of the Group provided to the holders pursuant to
Section 7.1(A)(a), Section 7.1(A)(b), Section 7.1(A)(c), Section 7.1(A)(d), Section 7.1(B)(a), Section 7.1(B)(b) or Section 7.1(B)(c), as the case may
be, in respect of such Accounting Period; or 


        (b)   for
purposes of Section 7.2(c), in respect of any Accounting Period of the Company or any of its Material Subsidiaries, the balance sheet and profit and loss
account of the Company or such Material Subsidiary (as applicable) provided to the holders pursuant to Section 7.1(A)(a), Section 7.1(A)(b), Section 7.1 (B)(a) or
Section 7.1(B)(b), as the case may be, in respect of such Accounting Period. 




        Acquisition—is defined in Section 10.11 (a). 


        Additional Payments—means, with respect to any Note, additional payments required to be paid to the holder of such Note
pursuant to and in accordance with the terms of Section 22.1. 


        Additional Provisions—is defined in Section 10.12. 


        Affected Holder—is defined in Section 8.7. 


        Affiliate—means at any time, and with respect to any Person: 



        (a)   any
other Person that at such time directly or indirectly through one or more intermediaries Controls, or is Controlled by, or is under common Control with, such first
Person; and 



1





 

        (b)   any
Person beneficially owning or holding, directly or indirectly, 10% or more of any class of voting or equity interests of the Company or any Subsidiary or any
corporation of which the Company and its Subsidiaries beneficially own or hold, in the aggregate, directly or indirectly, 10% or more of any class of voting or equity interests. 




Unless
the context otherwise clearly requires, any reference to an "Affiliate" is a reference to an Affiliate of the Company. 


        Agent—means HSBC Investment Bank plc or such other Person as may be appointed for the Banks pursuant to the Bank Facility
Agreement. 


        Agreement, this—is defined in Section 17.3. 



        Applicable GAAP—means, with respect to any Person, generally accepted accounting principles in effect from time to time in the
jurisdiction where such Person is organized or carries on its principal business operations. 


        Asset Disposition—means any Transfer except: 



        (a)   any
of the following: 



        (i)    a
Transfer from the Company or a Guarantor to the Company or a Guarantor so long as immediately before, and immediately after giving effect to, the consummation of such
Transfer, no Significant Default would exist; 


        (ii)   a
Transfer of Subsidiary Stock from the Company or a Guarantor to a Wholly-Owned Subsidiary (that is not a Guarantor) in connection with a bona
fide reorganization of the Group so long as immediately before, and immediately after giving effect to, the consummation of such Transfer, no Default or Event of Default would
exist; 


        (iii)  a
Transfer (other than a Transfer of Subsidiary Stock) from the Company or a Guarantor to a Wholly-Owned Subsidiary (that is not a Guarantor) so long as immediately
before, and immediately after giving effect to, the consummation of such Transfer, no Default or Event of Default would exist; 


        (iv)  a
Transfer from a Guarantor or the Company to a Subsidiary (that is not a Guarantor or a Wholly-Owned Subsidiary) which is for Fair Market Value so long as immediately
before, and immediately after giving effect to, the consummation of such Transfer, no Significant Default would exist; 



        (v)   a
Transfer from a Wholly-Owned Subsidiary (that is not a Guarantor) to the Company, a Guarantor or another Wholly-Owned Subsidiary so long as immediately before, and
immediately after giving effect to, the consummation of such Transfer, no Significant Default would exist; 


        (vi)  a
Transfer from a Wholly-Owned Subsidiary (that is not a Guarantor) to a Subsidiary (that is not a Guarantor or a Wholly-Owned Subsidiary) which is for Fair Market
Value so long as immediately before, and immediately after giving effect to, the consummation of such Transfer, no Default or Event of Default would exist; 



        (vii) a
Transfer from a Subsidiary (that is not a Guarantor or a Wholly-Owned Subsidiary) to the Company or any other Subsidiary, so long as, in the case of any such
Transfer to a Subsidiary that is not a Guarantor or a Wholly-Owned Subsidiary, (A) such transfer is for Fair Market Value and (B) immediately before, and immediately after giving effect
to, the consummation of such Transfer, no Default or Event of Default would exist; 




2





 






        (b)   any
Transfer (i) involving property that is equipment, fixtures, supplies or materials no longer required in the operation of the business of the Company and the
Subsidiaries or that is obsolete (for the avoidance of doubt, this shall not include a business segment or a division), so long as the excess, if any, between the aggregate then current book value and
the aggregate disposition proceeds of all such property so transferred pursuant to this sub-clause (i) does not exceed £4,000,000 in the aggregate for all such Transfers
in any financial year, (ii) which constitutes a disposal made in the ordinary course of business of the disposing entity, (iii) which constitutes a disposal of cash raised or borrowed
for the purposes for which it was raised or borrowed or (iv) which constitutes a disposal of assets in exchange for other assets comparable or superior as to type, value and quality; and 


        (c)   the
Project Schultz Transaction (subject to approval by the Company's shareholders and satisfaction of the conditions precedent set out in Section 4). 




        As
used in this definition, "Significant Default" means a Default (except a Default arising because of a failure by the Company to comply
with any provision described in Section 11(d), which has not yet become an Event of Default) or an Event of Default. 


        Bank Control Payment Date—is defined in Section 8.8. 


        Banks—means, collectively, the banks and financial institutions party to the Bank Facility Agreement, together with their
respective successors and assigns. 


        Bank Facility—means the £75,000,000 credit facility for the Company arranged by the Agent and as in effect on the
Effective Date (as supplemented, amended or modified from time to time), and any replacement facility or facilities from time to time entered into in respect of all or any part thereof. 


        Bank Facility Agreement—means the agreement dated June 14, 1999 in respect of the Bank Facility for the Company
arranged by Deutsche Bank AG (London) and the Agent (as supplemented, amended or modified from time to time), and any replacement agreement or agreements from time to time entered into in respect of
all or any part thereof. 


        Business Day—means (a) for the purposes of Section 8.9 only, any day other than a Saturday, a Sunday or a day on
which commercial banks in New York City are required or authorized to be closed, and (b) for the purposes of any other provision of this Agreement, any day other than a Saturday, a Sunday or a
day on which commercial banks in New York City or London, England are required or authorized to be closed. 


        Cash and Cash Equivalents—means, at any time: 



        (a)   cash
on deposit in any Permitted Bank; 


        (b)   any
investment in: 



        (i)    marketable
obligations issued or guaranteed by the United States of America or the United Kingdom or by an instrumentality or agency of the United States of America or
the United Kingdom having an equivalent credit rating; 


        (ii)   certificates
of deposit, maturing within one year after acquisition thereof, issued by a Permitted Bank; 


        (iii)  bankers
acceptances and eligible bills accepted by Permitted Banks, maturing within one year after acquisition thereof; and 


        (iv)  open
market commercial paper or other unsubordinated financial indebtedness: 



        (A)  for
which a recognized trading market exists on any Business Day; 





3





 



        (B)  issued
in the United States of America, the United Kingdom or the Eurodollar market; 


        (C)  which
matures within one year after acquisition thereof; and 


        (D)  which
has a credit rating of either "A-1" by Standard & Poor's or IBCA or "P-1" by Moody's or any future equivalent of any such credit
rating; or 





        (c)   any
other instrument, security or investment approved by the Required Holders, 




in
each case, to which any member of the Group is beneficially entitled at such time. 


        Change in Control—means any of the following events or circumstances: 



        (a)   any
Person or group of related Persons acting in concert obtains direct or indirect beneficial ownership of the Voting Shares of the Company carrying more than 50% of
the total combined voting power of all classes of Voting Shares of the Company; 


        (b)   any
Person or group of related Persons acting in concert obtains the right to control the appointment of a majority of the board of directors of the Company; 



        (c)   any
Person or group of related Persons acting in concert acquires all or substantially all of the assets of the Company; or 


        (d)   any
merger or consolidation that results in a Person or group of Persons acting in concert obtaining Control of the Successor Corporation of the Company. 




        For
these purposes, Persons "acting in concert" shall mean Persons which pursuant to an agreement or undertaking actively cooperate
through the acquisition by any of them of Voting Shares of the Company or otherwise to obtain or consolidate Control of the Company and shall include, for the avoidance of doubt, any Person or group
of Persons "acting in concert" within the meaning of such expression as used in The City Code on Takeovers and Mergers issued by the Panel on Takeovers and Mergers in the United Kingdom. 


        Change in Control Prepayment Date—is defined in Section 8.8. 


        Committed External Financing—is defined in Section 9.8. 


        Committed Medium-Term Financing—means a loan, credit or financing facility or facilities (including an extension
to the Bank Facility) providing for revolving or term loans pursuant to a written commitment by one or more banks or other financial institutions or any other external debt financing entered into by
the Company, in each case with a maturity or maturities of no earlier than March 31, 2006 providing for aggregate total commitments of not less than £50,000,000. 


        Companies Act 1985—means the Companies Act 1985 of the United Kingdom, as in effect in England and Wales and as amended from
time to time. 


        Company—is defined in the introductory sentence of this Agreement. 



        Competing Person—means any Person which is actively engaged in direct competition with the Company or any of its Subsidiaries
in any material line of business or any Affiliate of any such Person, provided that no Person a predominant portion of whose business involves banking,
insurance, investment banking, broker/dealer investment or similar activities (including, without limitation, any entity involved in the investment activities of or contributions to pension,
retirement, medical or similar plans or interests) shall be deemed a Competing Person if such Person is the holder or prospective transferee of the Notes by virtue of its normal sales, trading or
investment activities. 


        Confidential Information—is defined in Section 20. 


4





 



        Consolidated EBIT—means, in relation to any Accounting Period of the Group, the consolidated operating profit of the Group for
such Accounting Period calculated by reference to the Accounts of the Group for such Accounting Period and: 



        (a)   before
deducting, charging or providing for: 



        (i)    Consolidated
Net Interest Expense; and 


        (ii)   any
taxation as shown in the profit and loss section of such Accounts for such Accounting Period; and 




        (b)   before
taking into account any exceptional items (including, without limitation, profits or losses on the sale or termination of an operation, costs of a fundamental
reorganization or restructuring and profits or losses on the disposal of fixed assets) as shown in the profit and loss section of the Accounts of the Group for such Accounting Period. 




        Consolidated EBITA—means, in relation to any Accounting Period of the Group, the consolidated operating profit of the Group
for such Accounting Period calculated by reference to the Accounts of the Group for such Accounting Period and: 



        (a)   before
deducting, charging or providing for: 



        (i)    Consolidated
Net Interest Expense; 


        (ii)   any
taxation as shown in the profit and loss section of such Accounts for such Accounting Period; and 


        (iii)  amortization
charged during such Accounting Period; and 




        (b)   before
taking into account any exceptional items (including, without limitation, profits or losses on the sale or termination of an operation, costs of a fundamental
reorganization or restructuring and profits or losses on the disposal of fixed assets) as shown in the profit and loss section of the Accounts of the Group for such Accounting Period. 




        Consolidated EBITDA—means, in relation to any Accounting Period of the Group, the consolidated operating profit of the Group
for such Accounting Period calculated by reference to the Accounts of the Group for such Accounting Period and: 



        (a)   before
deducting, charging or providing for: 



        (i)    Consolidated
Net Interest Expense; 


        (ii)   any
taxation as shown in the profit and loss section of such Accounts for such Accounting Period; 


        (iii)  depreciation
in respect of such Accounting Period; and 


        (iv)  amortization
charged during such Accounting Period; and 




        (b)   before
taking into account any exceptional items (including, without limitation, profits or losses on the sale or termination of an operation, costs of a fundamental
reorganization or restructuring and profits or losses on the disposal of fixed assets) as shown in the profit and loss section of the Accounts of the Group for such Accounting Period. 




        Consolidated Interest Expense—means, in relation to any Accounting Period, all interest, acceptance commission and any other
continuing, regular or periodic costs and expenses in the nature of interest (whether paid, payable, or capitalized) incurred by the Group (other than interest paid or payable to another member of the
Group) during such Accounting Period. 


5





 

        Consolidated Interest Receivable—means, in relation to any Accounting Period of the Group, all interest received or receivable
by any member of the Group (other than interest received or receivable from another member of the Group) during such Accounting Period. 



        Consolidated Net Debt—means, at any time (and without duplication) of the Group, Total Consolidated Debt at such time  less Cash and Cash Equivalents at such
time. 


        Consolidated Net Interest Expense—means, in relation to any Accounting Period of the Group, Consolidated Interest Expense for
such Accounting Period less Consolidated Interest Receivable for such Accounting Period. 



        Consolidated Net Worth—means, as at any date, the sum for the Company and its Subsidiaries (without duplication) of: 



        (a)   that
amount paid up or credited as being paid up on the called-up share capital, plus (or  minus in the case of a negative amount); 


        (b)   that
amount credited to the share premium account, plus (or minus in the
case of a negative amount); 


        (c)   that
amount credited to the capital redemption reserve, plus (or minus in
the case of a negative amount); 


        (d)   that
amount then credited to the profit and loss account (excluding any amounts attributable to any dividend or other distribution at the time declared, recommended or
made by the Company), plus;


        (e)   any
amount credited as, or constituting, other non-distributable reserves (other than, for the avoidance of doubt, the revaluation reserve), 




all
as determined by reference to the then most recent audited, interim, or quarterly, as the case may be, consolidated balance sheet of the Company and its Subsidiaries required to be furnished
pursuant to Section 7.1(A)(a), Section 7.1(A)(b), Section 7.1(A)(c), Section 7.1(A)(d), Section 7.1(B)(a), Section 7.1(B)(b) or Section 7.1(B)(c), as
the case may be, provided that: 



        (A)  (i) any
write-offs or write-downs associated with any goodwill or any impairment charges and (ii) amortization of goodwill will not be added
back; and 


        (B)  there
shall be no increase or decrease in reserves attributable to translating non-Pounds Sterling balances in currencies other than Pounds Sterling at
exchange rates different from those used in the financial statements of the Group for the year ended December 31, 2002. 




        Consolidated Total Assets—means, at any time, the consolidated fixed assets and consolidated current assets of the Company and
its Subsidiaries as would be shown on a consolidated balance sheet of the Company and its Subsidiaries at such time prepared in accordance with UK GAAP, excluding, for the avoidance of doubt, goodwill
and investments in joint ventures. 


        Control—means, with respect to any Person, the power to direct the management and policies of such Person, directly or
indirectly, whether through the ownership of Voting Shares, by contract or otherwise; and the terms "Controlling" and
"Controlled" have meanings correlative to the foregoing. 


        Control Event—means the execution of any written plan or agreement by any Person or group of related Persons acting in concert
(as such term is used in the definition of "Change in Control" in this Schedule B) of which the Company is aware and which, if consummated, would result in a Change in Control (so long as
effecting such Change in Control is within the reasonable ability of such Person or group of Persons). 


6





 



        corporation—means a corporation, incorporated company or other entity substantially similar to a corporation, whether or not
called a "corporation" under the laws of (or in business terminology commonly used in) the jurisdiction where such Person is organized or conducts its primary business. 


        Debt Prepayment Application—means, for the purposes of Section 10.4(c) only, with respect to any Transfer of property,
the application by the Company or any Subsidiary of cash in an amount equal to the Net Proceeds Amount with respect to such Transfer to pay Senior Indebtedness other than (i) Senior
Indebtedness owing to the Company, any Subsidiary or any of their respective Affiliates, and (ii) Senior Indebtedness in respect of any revolving credit or similar credit facility providing the
Company or any Subsidiary with the right to obtain loans or other extensions of credit from time to time (except to the extent that in connection with such payment of Senior Indebtedness the
availability of credit under such credit facility is permanently reduced by an amount not less than the amount of such proceeds applied to the payment of such Senior Indebtedness),  provided that in the
course of making such application the Company shall prepay each outstanding Note in accordance with Section 8.3,
Section 8.4 and Section 8.5 in a principal amount which, when added to the Make-Whole Amount applicable thereto, is at least equal to the Ratable Portion for such Note. As
used in this definition, "Ratable Portion" for any Note means an amount equal to the product of (x) the Net Proceeds Amount being so applied to
the payment of Senior Indebtedness multiplied by (y) a fraction the numerator of which is the outstanding principal amount of such Note and the
denominator of which is the aggregate principal amount of Senior Indebtedness of the Company and its Subsidiaries. 


        Default—means an event or condition the occurrence or existence of which would, with the lapse of time or the giving of notice
or both, become an Event of Default. 


        Default Rate—means, with respect to any Series, the applicable rate of default interest as set out in Section 8.2. 



        Designated Debt Subsidiaries—means On-Site Limited (provided that
at least 90% of all of its Voting Shares, other equity interests and voting interests are at all times owned directly or indirectly by the Company (except directors' qualifying shares and shares or
other equity interests owned by directors or employers to the extent such ownership is required to comply with applicable local law or regulation)), Hellerman Tyton (Pty) Limited
(provided that at least 90% of all of its Voting Shares, other equity interests and voting interests are at all times owned directly or indirectly by
the Company (except directors' qualifying shares and shares or other equity interests owned by directors or employers to the extent such ownership is required to comply with applicable local law or
regulation)), Hellermann Tyton Pte Limited (provided that at least 75% of all of its Voting Shares, other equity interests and voting interests are at
all times owned directly or indirectly by the Company (except directors' qualifying shares and shares or other equity interests owned by directors or employers to the extent such ownership is required
to comply with applicable local law or regulation)) or Hellermann Tyton (Wuxi) Electrical Accessories Co. Ltd (provided that at least 75% of all
of its Voting Shares, other equity interests and voting interests are at all times owned directly or indirectly by the Company (except directors' qualifying shares and shares or other equity interests
owned by directors or employers to the extent such ownership is required to comply with applicable local law or regulation)). 



        Distribution—means in respect of any corporation, association or business entity: 



        (a)   dividends,
charges, fees or other distributions or payments on capital stock or other equity interests of such corporation, association or other business entity (except
distributions in such stock or other equity interest) including interest on any unpaid amount; 


        (b)   the
redemption or acquisition of such stock or other equity interests or of warrants, rights or other options to purchase such stock or other equity interests (except
when solely in exchange for such stock or other equity interests) unless made, contemporaneously, from the net proceeds of a sale of such stock or other equity interests; and 



7





 




        (c)   repayments
or distributions with respect to any share premium account. 




        EBIT—means, in respect of any Person in relation to any accounting period of such Person, the operating profit of such Person
for such accounting period calculated by reference to its accounts for such accounting period and: 



        (a)   before
deducting, charging or providing for: 



        (i)    Net
Interest Expense; and 


        (ii)   any
taxation as shown in the profit and loss section of such accounts for such accounting period; and 




        (b)   before
taking into account any exceptional items (including, without limitation, profits or losses on the sale or termination of an operation, costs of a fundamental
reorganization or restructuring and profits or losses on the disposal of fixed assets) as shown in the profit and loss section of the accounts for such accounting period. 




        Effective Date—is defined in Section 3. 


        Environmental Laws—means any and all statutes, laws, regulations, ordinances, rules, judgments, orders, decrees, permits,
concessions, grants, franchises, licenses, agreements or governmental restrictions relating to pollution and the protection of the environment or the release of any materials into the environment,
including but not limited to those related to hazardous substances or wastes, air emissions and discharges to waste or public systems. 


        ERISA—means the Employee Retirement Income Security Act of 1974 of the United States of America, as amended from time to time,
and the rules and regulations promulgated thereunder from time to time in effect. 



        ERISA Affiliate—means any trade or business (whether or not incorporated) that is treated as a single employer together with
the Company under Section 414 of the US Tax Code. 


        Event of Default—is defined in Section 11. 


        Existing Note Purchase Agreements—is defined in Section 1.1. 


        Existing Notes—is defined in Section 1.1. 


        Existing Series A Notes—is defined in Section 1.1. 


        Existing Series B Notes—is defined in Section 1.1. 


        Existing Series C Notes—is defined in Section 1.1. 



        Existing Series D Notes—is defined in Section 1.1. 


8







   
        Fair Market Value—means, at any time and with respect to any property, the sale value of such property that would be realized
in an arm's-length sale at such time between an informed and willing buyer and an informed and willing seller (neither being under a compulsion to buy or sell). 


        Finance Lease—means, at any time, a lease with respect to which the lessee is required concurrently to recognize the
acquisition of an asset and the incurrence of a liability in accordance with UK GAAP. 


        Financial Indebtedness—means any indebtedness (without duplication) of any Person in respect of: 



        (a)   moneys
borrowed; 


        (b)   any
debenture, bond, note, loan stock or other similar security; 



        (c)   any
acceptance credit; 


        (d)   receivables
sold or discounted (to the extent of recourse); 


        (e)   the
acquisition cost of any asset to the extent payable before or after the time of acquisition or possession by the party liable where the advance or deferred payment
is arranged primarily as a method of raising finance or financing the acquisition of that asset and, for the purposes of Section 10.3(m) and Section 10.7(a), to the extent that it is
required by UK GAAP to be shown as a borrowing in the Accounts of such Person; 


        (f)    any
Finance Lease; 


        (g)   any
currency swap or interest swap, cap or collar arrangement or any other derivative instrument the amount of which will be calculated on a mark to market basis; 


        (h)   any
amount raised under any other transaction having the commercial effect of a borrowing or raising of money; 


        (i)    any
redemption obligations in respect of mandatorily redeemable preference shares other than such redemption obligations that may not by their terms be payable prior to
the Notes being repaid in full; or 


        (j)    any
Guaranty of another Person's indebtedness referred to in clause (a) through (i), inclusive, above. 




        Financing Documents—means, collectively, this Agreement, the Notes and the Subsidiary Guarantees and any and all other
agreements, documents and instruments relating thereto or hereto to which any one or more of the Noteholders, the Company, any Guarantor or any Subsidiary is a party. 


        Forms—is defined in Section 22.1. 


        FRS—means a financial reporting standard issued by the Accounting Standards Board in the United Kingdom. 


        Governmental Authority—means: 



        (a)   the
government of: 



        (i)    the
United States of America or any state or other political subdivision thereof; or 


        (ii)   the
United Kingdom or any jurisdiction or other political subdivision thereof; or 


        (iii)  any
jurisdiction in which the Company or any Subsidiary conducts all or any part of its business, or which asserts jurisdiction over any properties of the Company or
any Subsidiary; or 




9





 






        (b)   any
entity exercising executive, legislative, judicial, regulatory or administrative functions of, or pertaining to, any such government. 




        Group—means, at any time, the Company and its Subsidiaries at such time. 


        Guarantees—is defined in Section 2.2. 


        Guarantors—means, each Original Guarantor together with each Subsidiary Guarantor which delivers a Subsidiary Guarantee
pursuant to, and otherwise satisfies the conditions contained in, Section 10.7(b). 


        Guaranty—means, with respect to any Person, any obligation (except the endorsement in the ordinary course of business of
negotiable instruments for deposit or collection) of such Person guaranteeing or in effect guaranteeing any financial indebtedness, dividend or other obligation of any other Person in any manner,
whether directly or indirectly, including, without limitation, obligations incurred through an agreement, contingent or otherwise, by such Person: 



        (a)   to
purchase such financial indebtedness or obligation or any property constituting security therefor; 


        (b)   to
advance or supply funds (i) for the purchase or payment of such financial indebtedness or obligation, or (ii) to maintain any working capital or other
balance sheet condition or any income statement condition of any other Person or otherwise to advance or make available funds for the purchase or payment of such financial indebtedness or obligation; 


        (c)   to
lease properties or to purchase properties or services primarily for the purpose of assuring the owner of such financial indebtedness or obligation of the ability of
any other Person to make payment of the financial indebtedness or obligation; or 


        (d)   otherwise
to assure the owner of such financial indebtedness or obligation against loss in respect thereof. 




In
any computation of the financial indebtedness or other liabilities of the obligor under any Guaranty, the financial indebtedness or other obligations that are the subject of such Guaranty shall be
assumed to be direct obligations of such obligor. 


        Hazardous Material—means any and all pollutants, toxic or hazardous wastes or any other substances that might pose a hazard to
health or safety, the removal of which may be required or the generation, manufacture, refining, production, processing, treatment, storage, handling, transportation, transfer, use, disposal, release,
discharge, spillage, seepage, or filtration of which is or shall be restricted, prohibited or penalized by any applicable law (including, without limitation, asbestos, urea formaldehyde foam
insulation and polychlorinated biphenyls). 


        holder—means, with respect to any Note, the Person in whose name such Note is registered in the register maintained by the
Company pursuant to Section 13.1. 


        Holder Tax Amount—is defined in Section 22.3. 


        IBCA—means the Fitch IBCA Group. 


        Information Pack—means, collectively, the documents entitled (a) "Draft Presentation—covenant amendments"
dated December 18, 2002, (b) the "Project Conker Information Memorandum" dated December 18, 2002 and (c) the "Project Conker Supplementary Information Memorandum" dated
January 13, 2003 and any supplement delivered by the Company to the Noteholders in writing prior to the date hereof. 


        Insolvency Act—means the Insolvency Act 1986 of the United Kingdom, as amended from time to time. 


10





 



        Institutional Investor—means (a) any original purchaser of a Note, (b) any holder of a Note holding more than 5%
of the aggregate principal amount of the Notes then outstanding, and (c) any bank, trust company, savings and loan association or other financial institution, any pension plan, any investment
company, any insurance company, any broker or dealer, or any other similar financial institution or entity, regardless of legal form. 


        Interest Rate Agreement—means any interest rate swap agreement, interest rate cap agreement, interest rate collar agreement,
interest rate futures contract, interest rate option agreement or other similar agreement or arrangement to which the Company is a party, designed to protect the Company against fluctuations in
interest rates. 


        IRS—means the United States Internal Revenue Service or any successor governmental agency. 


        ISDA—means the International Swap Dealers Association. 


        Lien—means, with respect to any Person, any mortgage, lien, pledge, charge, security interest, assignment, hypothecation,
other encumbrance, or any other agreement having the effect of conferring security, or any interest or title of any vendor, lessor, lender or other secured party to or of such Person under any
conditional sale or other title retention agreement or Finance Lease, upon or with respect to any property or asset of such Person (including in the case of share capital, shareholder agreements,
voting trust agreements and all similar arrangements). 


        LSE—means the London Stock Exchange Limited. 


        Make-Whole Amount—is defined in Section 8.9. 



        Material—means material in relation to the business, operations, affairs, financial condition, assets or properties of the
Company and its Subsidiaries taken as a whole. 


        Material Adverse Effect—means a material adverse effect on (a) the business, operations, affairs, financial condition,
assets or properties of the Company and its Subsidiaries taken as a whole, (b) the ability of the Company to perform its obligations under this Agreement and the Notes including, without
limitation, its payment obligations and its obligations under the financial covenants set forth in Section 10, (c) the ability of any Guarantor to perform its obligations under its
respective Guarantee or (d) the validity or enforceability of this Agreement, the Notes or any Guarantee. 


        Material Subsidiary—means before any certificate of Senior Officers is delivered under Section 7.2(c), each Subsidiary
listed in Schedule 5.4 as a "Material Subsidiary," and, thereafter, each Subsidiary listed in the certificate of Senior Officers most recently provided under Section 7.2(c), and in each
case as long as such Material Subsidiary is still a "Subsidiary" and shall include all Guarantors. 


        Modified Make-Whole Amount—is defined in Section 8.9. 


        Moody's—means Moody's Investors Service, Inc. 


        NAIC Annual Statement—means an annual statement of the National Association of Insurance Commissioners. 


        Net Distributable Earnings—means funds available for distribution, subject to Section 264 of the Companies Act 1985,
being the accumulated, realized profits of the Company less the accumulated, realized losses of the Company, as defined in Section 263(3) of the
Companies Act 1985, and with reference to the Company's Accounts, as prepared in accordance with UK GAAP. 


        Net Interest Expense—means, in respect of any Person in relation to any Accounting Period, all interest, acceptance commission
and any other continuing, regular or periodic costs and expenses in the nature of interest (whether paid, payable, or capitalized) incurred by such Person during such Accounting Period  less all interest
received or receivable by such Person during such Accounting Period. 


11





 



        Net Proceeds Amount—means, with respect to any Transfer of any property by any Person, an amount equal to the  difference of: 



        (a)   the
aggregate amount received in cash (including any cash received with respect to a deferred payment pursuant to a note receivable, other non-cash
consideration or otherwise, but only upon actual receipt of such cash) in connection with such Transfer; and 


        (b)   the
sum of: 



        (i)    the
unpaid principal amount of, and accrued interest and premium (if any) on, any Financial Indebtedness which is secured by, or assumed or incurred to finance all or
part of the purchase price of, or cost of developing, the property so disposed of (other than such Financial Indebtedness assumed by the purchaser of such property) and which is required to be and is
repaid in connection with such Transfer; 


        (ii)   all
out-of-pocket expenses incurred by the Company or any Subsidiary in connection with such Transfer; 


        (iii)  all
taxes, including taxes assessed against income, which the Company considers likely to be payable by it or any of its Subsidiaries as a result of such Transfer
(calculated based on the assumption that such Transfer was the only transaction in which the Company and its Subsidiaries engaged during the relevant period, without giving effect to any
carryforwards, carrybacks or other credits) and after accounting for any reserves for warranty claims which are reasonable to the extent that the use of such reserves by the Company and its
Subsidiaries is restricted until the Transfer of such potential claims; and 



        (iv)  where
the Transfer is a Transfer of Subsidiary Stock of a Subsidiary, the principal amount and accrued interest thereon of any indebtedness owing from such Subsidiary
to another member of the Group that is forgiven in connection with such Transfer, and the amount of any contribution of a capital nature to such Subsidiary made in connection with such Transfer of
Subsidiary Stock. 





        Network Products Division—means the Company's division comprised of the following entities: HellermanTyton
("HT"), divisions of Spirent plc (divisions: HT Broadband, HT Plymouth, HT Ireland, HT BHD, HT Manchester and the assets and business of Staeng
Limited), Staeng Limited, HT Data Limited, Spirent Australia pty Limited, HellermanTyton GmbH, HellermanTyton S.A., HellermanTyton pty Limited, HellermanTyton AB, HellermanTyton Limitada,
HellermanTyton Srl, Spirent BV's interest in HellermanTyton Pte Limited (75%), Spirent BV's interest in Tyton Corporation of Japan (49%), Spirent International Inc's interest in HellermanTyton
Corporation and all subsidiaries of such companies (97%). 


        Non-US Pension Plan—means any plan, fund or other similar program: 



        (a)   established
or maintained outside of the United States of America by any one or more of the Company or its Subsidiaries primarily for the benefit of employees
(substantially all of whom are not citizens of, and do not reside within, the United States of America) of the Company or such Subsidiaries which plan, fund or other similar program provides for
retirement income for such employees or results in a deferral of income for such employees in contemplation of retirement; and 


        (b)   not
subject to ERISA. 




        Normalization Certificate—means a certificate signed by the group finance director of the Company and delivered by the Company
to the holders of the Notes and in the form attached to this Agreement as Exhibit B. 


12





 

        Normalization Conditions—means the following conditions precedent: 



        (i)    on
three consecutive Normalization Testing Dates, the Company's ratio of Consolidated Net Debt, as of each such Normalization Testing Date, to Consolidated EBITDA, for
the Accounting Period ending on such Normalization Testing Date (which, for the avoidance of doubt, shall be a period of twelve consecutive months ending on such Normalization Testing Date), is less
than 1.5 to 1.0 provided that for the purposes of this clause (i), Consolidated Net Debt shall be calculated by converting debt balances
denominated in currencies other than Pounds Sterling at the same respective rates of exchange used to convert any Consolidated EBITDA denominated in currencies other than Pounds Sterling over the
relevant Accounting Period; 


        (ii)   on
three consecutive Normalization Testing Dates, the Company's ratio of Consolidated EBITA to Consolidated Net Interest Expense, in each case determined for the
Accounting Period ending on such Normalization Testing Date (which, for the avoidance of doubt, shall be a period of twelve consecutive months ending on such Normalization Testing Date), is in excess
of 4.5 to 1.0 provided that such ratio shall be computed without giving effect to any Interest Rate Agreement or Interest Rate Agreements entered into
by any member of the Group after the date of this Agreement to the extent that the aggregate nominal principal amount subject to all Interest Rate Agreements held by any member of the Group (whether
entered into before or after the date hereof) at any time of computation of such ratio exceeds the aggregate nominal principal amount subject to Interest Rate Agreements as of the date of this
Agreement. The foregoing proviso shall be applied, to the extent necessary, to exclude the most recent Interest Rate Agreement at any such time of computation and then continuing in the inverse
chronological order in which they were entered into; 


        (iii)  the
Company shall have obtained Committed Medium-Term Financing; and 


        (iv)  no
Default or Event of Default shall have occurred which is continuing. 




        For
the purposes of clauses (i) and (ii) above: 




        (A)  each
of the ratios referred to shall be determined for and tested as at each Normalization Testing Date on the basis of the Company's management accounts and, if
applicable, annual audited consolidated financial statements for the applicable Accounting Period; 


        (B)  the
relevant Normalization Testing Dates must be the same Normalization Testing Dates for each of the tests referred to; and 


        (C)  the
last Normalization Testing Date for any three consecutive Normalization Testing Dates may not be before the Normalization Testing Date occurring on June 30,
2004. 





        For
the purposes of clause (i), (ii), (iii) and (iv) above, all of the conditions precedent must be satisfied concurrently. 


        Normalization Date—shall be the date on which the Company delivers a Normalization Certificate to each of the Noteholders and
each of the four Normalization Conditions shall have been concurrently satisfied provided that the Normalization Date may not occur until after the
Company has issued its audited financial accounts for the financial year ended December 31, 2003 and in any event not prior to June 30, 2004. 



        Normalization Testing Date—means the last day of each financial quarter of the Group. 


        Noteholders—means the holders of the Notes from time to time. 


        Notes—is defined in Section 2.1. 


13





 



        Officer's Certificate—means a certificate given hereunder of Senior Financial Officers of the Company, or of any other officer
of the Company whose responsibilities extend to the subject matter of such certificate. 


        Order—means any order, writ, injunction, decree, judgment, award, determination, direction or demand. 


        Original Group Accounts—means the audited consolidated accounts of the Group for the year ended December 31, 1998,
subject to Section 23.8. 


        Original Guarantors—is defined in Section 2.2. 


        Outstanding Company Notes—means the US$75,000,000 aggregate principal amount of the Company's 6.89% Senior Notes due 2003
which were exchanged on or about November 23, 1999 for Existing Notes. 


        PBGC—means the Pension Benefit Guaranty Corporation referred to and defined in ERISA or any successor thereto. 



        Permitted Bank—means: 



        (a)   any
commercial bank or trust company having, in respect of its long-term unsecured debt obligations, a rating of "A" or higher by Standard & Poor's or
IBCA or "A-2" or higher by Moody's or a comparable rating from a nationally recognized (in England) credit rating agency; or 


        (b)   HSBC
Investment Bank plc, so long as its ultimate parent shall have in respect of its long-term unsecured debt obligations, a rating of "A-" or
higher by Standard & Poor's or IBCA or "A-3" or higher by Moody's or a comparable rating from a nationally recognized (in England) credit rating agency. 




        Permitted Disposals—means: 



        (a)   disposals
made in the ordinary course of trade of the disposing entity; 


        (b)   any
disposal listed in clauses (a)(i) to (a)(vii) of the definition of "Asset Disposition"; 


        (c)   dealings
with trade debtors with respect to book debts in the ordinary course of trading; 


        (d)   disposals
of cash on arm's length terms not otherwise prohibited by this Agreement; 


        (e)   disposals
of immaterial real property no longer required for the operation of the Company's business and as set out on Schedule B.1 hereto; 


        (f)    disposals
of cash raised or borrowed for the purposes for which it was raised or borrowed; 


        (g)   disposals
of assets in exchange for other assets comparable or superior as to type, value and quality; 


        (h)   diposals
of obsolete assets for cash; and 


        (i)    Permitted
Reorganizations. 




        Permitted Reorganization—is defined in Section 10.2. 



        Person—means an individual, partnership, corporation, limited liability company, association, trust, unincorporated
organization, or a government or agency or political subdivision thereof. 


        Pounds Sterling or £—means lawful money of the United Kingdom. 


14





 



        Preferred Shares—means any class of share capital of a corporation that is preferred over any other class of capital shares of
such corporation as to the payment of dividends or the payment of any amount upon liquidation or dissolution of such corporation. 


        Project Schultz Documentation—means the documentation in relation to the Project Schultz Transaction including, without
limitation, the WAGO Agreements, the circular to be sent to the shareholders of the Company in connection with the Project Schultz Transaction and the working capital report prepared by KPMG LLP in
respect of the Company in connection with the circular. 


        Project Schultz Prepayment Date—is defined in Section 4.7(a). 


        Project Schultz Transaction—means the disposal by Spirent GmbH and Spirent B.V. of all their respective interests in the WAGO
Joint Venture pursuant to the WAGO Agreements. 


        property or properties—means, unless otherwise specifically limited, real or personal property of any kind, tangible or
intangible, choate or inchoate. 


        Property Reinvestment Application—means for the purposes of Section 10.4 only, with respect to any Transfer of
property, the application of an amount equal to the Net Proceeds Amount with respect to such Transfer to the acquisition by the Company or any Subsidiary of operating assets of the Company or any
Subsidiary or share capital or other equity interests of any Person that becomes a Subsidiary, so long as such operating assets or the business of such Person that becomes a Subsidiary is reasonably
related to the then existing business lines of the Group. 


        PTE—is defined in Section 6(a). 


        QPAM Exemption—means Prohibited Transaction Class Exemption 84-14 issued by the United States of America
Department of Labor. 


        Rejection Notice—is defined in Section 8.7. 


        Required Holders—means, at any time, the holder or holders of at least sixty-six and two-thirds
percent (662/3%) in principal amount of the Notes (without regard to Series) at the time outstanding (exclusive of Notes then owned by the Company or any of its Affiliates). 


        Response Date—is defined in Section 8.8. 


        Responsible Officer—means any Senior Financial Officer of the Company and any other officer of the Company with responsibility
for the administration of the relevant portion of this Agreement. 


        Restructuring Transaction—is defined in Section 2.1. 



        Securities Act—means the Securities Act of 1933 of the United States of America, as amended from time to time. 


        Senior Financial Officer—means any officer of the Company or any Guarantor, as the context may require, fulfilling any of the
following roles: financial officer, group finance director, principal accounting officer, treasurer or head of corporate finance of the Company or any Guarantor, as the context may require. 


        Senior Indebtedness—means (a) any Financial Indebtedness of the Company or any Guarantor, other than any Financial
Indebtedness that is in any manner subordinated in right of payment or security in any respect to Financial Indebtedness evidenced by the Notes or the Subsidiary Guarantees, and (b) any
Financial Indebtedness of any Subsidiary (other than the Guarantors). 


        Senior Officers—means two authorized signatories of the Company, at least one of whom is a Senior Financial Officer. 


        Series—means any series of Notes. 


15






 



        Series A Notes—is defined in Section 2.1. 


        Series B Notes—is defined in Section 2.1. 


        Series C Notes—is defined in Section 2.1. 


        Series D Notes—is defined in Section 2.1. 



        Significant Qualification—means, with respect to an opinion of independent chartered accountants, a qualification to their
opinion arising from (a) a restriction or limitation on the scope of audit, (b) the inadequacy of internal financial controls or (c) such independent chartered accountants'
concern as to whether any of the companies being reported on should properly be viewed as a going concern. 


16







   
        Source—is defined in Section 6. 


        Special Tax Event—means an amendment to, or change in, the laws or regulations of any Taxing Jurisdiction affecting taxation,
or an amendment to, or change in, an official interpretation or application of such laws or regulations (including, without limitation, pursuant to a final decision or Order of a taxing authority
having competent jurisdiction), which amendment or change (a) shall have occurred after November 23, 1999 (or in the case of any jurisdiction that thereafter becomes a Taxing
Jurisdiction, as described in Section 22.1, after such jurisdiction becomes a Taxing Jurisdiction) and (b) in the opinion of the Company (which shall be evidenced by an Officer's
Certificate and supported by written opinion of counsel having recognized expertise in the field of taxation in the Taxing Jurisdiction, which counsel shall be a firm reasonably satisfactory to the
Required Holders and which Officer's Certificate and opinion of counsel shall be delivered to all holders of the Notes prior to any prepayment of Notes under Section 8.7) shall require
Additional Payments. 


        SSAP—means a standard of accounting practice issued by the Accounting Standards Committee of the United Kingdom. 


        Standard & Poor's—means Standard & Poor's Rating Services, a division of McGraw Hill Companies Inc. 


        Subsidiary—means, as to any Person: 



        (a)   a
subsidiary of such Person within the meaning of section 736 of the Companies Act 1985; and 



        (b)   in
relation to the financial statements or any financial covenants in respect of the Group (including, without limitation, Section 10.3 through
Section 10.7, inclusive), a subsidiary undertaking within the meaning of section 258 of the Companies Act 1985, 




        and
unless the context otherwise clearly requires any reference to a "Subsidiary" is a reference to a Subsidiary of the Company. 


        Subsidiary Guarantee—is defined in Section 2.2. 


        Subsidiary Guarantor—is defined in Section 10.7. 


        Subsidiary Stock—means, with respect to any Person, the capital stock or other equity interests (or any options or warrants to
purchase stock, shares or interests or other securities exchangeable for or convertible into stock, shares or interests) of any Subsidiary of such Person. 


        Successor Corporation—is defined in Section 10.2. 



        Systems-Drive Division—means the business and assets of PG DrivesTechnology Limited owned by PG International plc, PG Drives
Technology Limited and PG Drives Technology Inc. 


        Tax—means any tax (whether income, documentary, sales, stamp, registration, issue, capital, property, excise or otherwise),
duty, levy, import, fee, compulsory loan, charge or withholding that is imposed by any Governmental Authority or any taxing authority thereof. 


        Tax Prepayment Notice—is defined in Section 8.7. 


        Taxing Jurisdiction—is defined in Section 22.1. 


        Testing Date—means (a) prior to the Normalization Date, the last day of each financial quarter of the Group, and
(b) on and after the Normalization Date, the last day of each financial year and the last day of each financial half-year of the Group. 


17





 



        Total Assets—means, at any time, in respect of the Company or any Material Subsidiary, the fixed assets and current assets of
the Company or such Material Subsidiary (as applicable) as shown on the then latest balance sheet of the Company or such Material Subsidiary (as applicable) prepared in accordance with UK GAAP,
excluding, for the avoidance of doubt, goodwill. 


        Total Consolidated Debt—means, at any time with respect to the Company and its Subsidiaries, the aggregate (without
duplication) of the following: 



        (a)   the
outstanding principal amount of any moneys borrowed by such Persons and any outstanding overdraft debit balance of any such Person (but subject to set off in
accordance with UK GAAP); 


        (b)   the
outstanding principal amount of any debenture, bond, note, loan stock or other similar security of any such Person; 


        (c)   the
outstanding principal amount of any acceptance under any acceptance credit opened by a bank or other financial institution in favor of any such Person; 



        (d)   any
amount raised pursuant to any issue of shares which are or may be expressed to be redeemable at the insistence of the holder thereof at any time prior to the date on
which all Notes have been irrevocably and unconditionally repaid in full; 


        (e)   the
outstanding principal amount of all moneys owing by any such Person in connection with the sale or discounting of receivables (to the extent of recourse to such
Person or any other member of the Group); 


        (f)    the
outstanding principal amount of any financial indebtedness of any such Person arising from any advance or deferred payment agreements arranged primarily as a method
of raising finance or financing the acquisition of an asset to the extent such financial indebtedness is required by UK GAAP to be shown as a borrowing in the Accounts; 


        (g)   the
capitalized element of financial indebtedness of any such Person in respect of a lease entered into primarily as a method of raising finance or financing the
acquisition of the asset leased and required to be accounted for under SSAP 21 or FRS 5; 


        (h)   any
fixed or minimum premium on the repayment or redemption at maturity of any instrument referred to in clause (b) above which is or may be expressed to be
payable at any time prior to the date on which all Notes have been irrevocably and unconditionally repaid in full; and 



        (i)    the
outstanding principal amount of any financial indebtedness of any Person of a type referred to in clause (a) through clause (h) above, inclusive, which
is the subject of a guarantee, indemnity or similar assurance against financial loss given by any such Person. 




        Total Subsidiary Debt—means, at any time without duplication, the aggregate amount of: 



        (a)   the
aggregate Financial Indebtedness of each Subsidiary (whether or not such Subsidiary is a Guarantor) outstanding at such time,  plus, 



        (b)   all
claims in respect of the redemption of, and accumulated, unpaid dividends on, all Preferred Shares (and all securities convertible into, exchangeable for, or
representing the right to purchase, Preferred Shares) of each Subsidiary whether or not such Subsidiary is a Guarantor (whether or not any right of redemption or conversion is exercisable by the
holder thereof at any time), 




        but excluding from such calculation: 




        (i)    any
such Financial Indebtedness of any Subsidiary owing to the Company, any Guarantor or any Wholly-Owned Subsidiary; 




18





 


        (ii)   any
such Financial Indebtedness of any Subsidiary owing to any Designated Debt Subsidiary which is not a Guarantor or a Wholly-Owned Subsidiary  provided that the amount of such Financial Indebtedness under
this sub-clause (ii) shall not exceed £2,500,000 in
aggregate and shall have been incurred solely for cash management purposes in the ordinary course of business consistent with past practices; 


        (iii)  all
such Preferred Shares and other securities which are legally and beneficially owned by any of the Company, any Guarantor or any Wholly-Owned Subsidiary; 


        (iv)  Financial
Indebtedness of any Person which becomes a Subsidiary after the Effective Date for a period of up to 180 days after the date such Person becomes a
Subsidiary (other than Financial Indebtedness incurred or contractually bound to be incurred solely in contemplation of such Person becoming a Subsidiary)  provided that such Subsidiary shall have
executed a Subsidiary Guarantee within ten Business Days of the date such Subsidiary becomes a Subsidiary and
such Subsidiary shall not enter into any other Guaranty whatsoever in favor of any other Person whatsoever prior to it having executed such Subsidiary Guarantee; 


        (v)   all
Financial Indebtedness of Subsidiaries outstanding on December 31, 2002 and identified on Schedule 5.13; and any extensions, renewals and refinancings
of such Financial Indebtedness described in this clause (iv) to the extent that, in connection therewith, the principal amount thereof is not increased; 


        (vi)  any
such Financial Indebtedness of any Guarantor constituting Guarantees; and 


        (vii) any
such Financial Indebtedness of any Guarantor in respect of the Bank Facility, any Committed Medium-Term Financing or any Committed External Financing
to the extent such Financial Indebtedness is otherwise expressly permitted under this Agreement. 





        Transfer—means, with respect to any Person, any transaction in which such Person sells, conveys, transfers or leases (as
lessor) any of its property, including, without limitation, Subsidiary Stock. 


        UK GAAP—means generally accepted accounting principles as in effect from time to time in the United Kingdom. 


        US Bankruptcy Code—means the United States Bankruptcy Code, Title 11 United States Code §§ 101 et
seq., as amended from time to time. 


        US Dollars or US$ or Dollars or  $—means
lawful currency of the United States of America. 


        US Multiemployer Plan—means any US Plan that is a "multiemployer plan" (as such term is defined in Section 4001(a)(3)
of ERISA). 


        US Plan—means an "employee benefit plan" (as defined in Section 3(3) of ERISA) that is or, within the preceding five
years, has been established or maintained, or to which contributions are or, within the preceding five years, have been made or required to be made, by the Company or any ERISA Affiliate or with
respect to which the Company or any ERISA Affiliate may have any liability. 


        US Tax Code—means the Internal Revenue Code of 1986 of the United States of America, as amended from time to time, and the
rules and regulations promulgated thereunder from time to time. 


        US/UK Tax Treaty—is defined in Section 5.18. 



        Voting Shares—means the capital shares of any class or classes of an entity having power under ordinary circumstances to vote
for the election of members of the board of directors or similar governing body of such entity, or Persons performing similar functions (irrespective of whether or not at the time shares of any other
class or classes shall have or might have special voting power or rights by reason of the happening of any contingency). 


19





 



        WAGO Agreements—means each of (a) the sale and purchase agreement, dated on or about March 11, 2003 between
Spirent GmbH and each of Hohorst Familien Holding (Minden) Beteiligungs GmbH and Hohorst Familien Holding (Schweiz) Beteiligungs GmbH, relating to the sale of the shares in WAGO Kontakttechnik GmbH,
(b) the sale and purchase agreement, dated on or about March 11, 2003 between Spirent GmbH and Sven-Michael Hohorst, relating to the sale of the shares in WAGO Verwaltungs
GmbH, (c) the sale and purchase agreement, dated on or about March 11, 2003 between Spirent GmbH, Gesellschaft burgerlichen Rechts Wolfgang and Sven-Michael Hohorst relating
to the sale of the shares in each of Hohorst Familien Holding (Minden) Beteiligungs GmbH, Hohorst Familien Holding (Minden) Beteiligungs GmbH and Hohorst Holding (Schweiz) Beteiligungs GmbH, and
(d) the sale and purchase agreement, dated on or about March 11, 2003 between Spirent B.V., Hohorst Familien Holding (Minden) Beteiligungs GmbH and Hohorst Familien Holding (Schweiz)
Beteiligungs GmbH relating to the sale of the shares in WAGO Contact S.A. 


        WAGO Joint Venture—means the interconnection joint venture in respect of WAGO Kontakttechnik GmbH, WAGO Verwaltungs GmbH and
WAGO Contact S.A., their subsidiaries and their subsidiary undertakings. 



        Wholly-Owned Subsidiary—means, at any time, any Subsidiary 100% of all of the Voting Shares, other equity interests and voting
interests of which are owned directly or indirectly by the Company (except directors' qualifying shares and shares or other equity interests owned by directors or employees to the extent such
ownership is required to comply with applicable local law or regulation). 


20






   SCHEDULE B.1  


 DISPOSALS OF CERTAIN REAL PROPERTY  



	Property
 
	 	Headlease expiry date
	 
	74 Inverness Drive, East Englewood,

California, USA

(MLI facility)	 	30 June 2005	 
	Unit 7, Freshfields Industrial Estate

Stevensen Road, Brighton

UK	 	24 June 2007	 
	Unit 8a, Freshfields Industrial Estate

Stevensen Road, Brighton

UK	 	24 June 2007	 
	Unit 8b, Freshfields Industrial Estate

Stevensen Road, Brighton

UK	 	24 June 2007	 
	Unit 50 Clifton Road Industrial Estate, Cambridge	 	05 September 2010	 
	Avenida Marginal Direita do Rio Tiete,

800 Vila, Jaguara, Sao Paulo, SP05118-100

Brazil	 	N/A—Owned by HT Brazil	 
	New York (Tempo facility)

85 Adams Avenue, Hauppauge

New York 11788	 	30 March 2006 (Break 30 September 2004	)
	The Lodge, Harmondsworth Lane, West Drayton

Middlesex	 	June 2013	 
	La Jolla 7580-7590 Fay Avenue

San Diego, California (part vacated)	 	29 February 2004	 
	Thermalloy Facility, 2021 Valley View Lane,

Dallas TX 75234	 	30 November 2008	 
	330 Research Court,

Norcress (old Net-Hopper property)	 	31 May 2004	 
	Suite 1450,

Concord

California	 	December 2003	 
	Zarak, 1380 Borregas Avenue,

Sunnyvale CA 94089	 	Q2 2005	 
	DLS, 750 Palladium Drive, Ottawa

Ontario K2V IC7 Canada	 	Q3 2010	 
	San Jose (Sales), 70 Daggett Drive,

San Jose CA 95134	 	Ql 2008	 
	Liberty Canyon (2nd floor), 27349 Agoura Road

Calabasas, CA 91301	 	2017	 
	Hawaii (27th floor), 999 Bishop Street,

Honolulu HI 96813	 	2007	 
	Hawaii (16th floor), 999 Bishop Street,

Honolulu HI 96813	 	2007	 
	Hawaii (Kaimuki—old facility), 3465 Waialae Avenue

Suite 300 Hawaii 96816	 	Q4 2005	 
	RTP, North Carolina (R&D), 900 Main Campus Drive

Suite 201 Raleigh NC 27606	 	Q2 2008	 
	 	 	 	 





1





 

	Boston (Sales Office), 59 Composite Way Suite

MA 01851	 	2005	 
	Plano, Texas (Sales Office), 101 E. Park Boulevard Suite 451

Plano Texas 75074	 	Q2 2006	 




2







 
 

SCHEDULE 2.2    
    
    ORIGINAL GUARANTORS    
    


Caw
Networks, Inc.

PG Drives Technology, Inc.

Spirent Communications Inc.

Spirent Communications of Rockville, Inc.

HellermannTyton Corporation

HellermannTyton Canada Incorporated

Spirent Communications of Ottawa Limited

PG International plc

HellermannTyton Data Limited

Spirent Communications (Scotland) Limited

Spirent Communications (SW) Limited

Spirent Communications Limited

Spirent Holdings Corporation

Spirent International, Inc.

Spirent Financing Corporation

Netcom Systems Holding Corporation

Spirent Overseas Limited

Reorg Company 1, Inc.

Reorg Company 2, Inc. 





 
 

SCHEDULE 5.3    
    
    DISCLOSURE MATERIALS    
    


None. 







 
 

SCHEDULE 5.4    
    
    SUBSIDIARIES; AFFILIATES, ETC.    
    


	(a)
	(i) Subsidiaries
of the Company principally affecting the financial statements of the Group as at 31 December 2002 






	Name
 
	 	Jurisdiction of Incorporation
	 	Percentage Equity Held

	SPIRENT COMMUNICATIONS (SCOTLAND) LIMITED	 	UK	 	100
	SPIRENT COMMUNICATIONS INC.	 	USA	 	100
	SPIRENT COMMUNICATIONS OF OTTAWA LIMITED	 	Canada	 	100
	SPIRENT COMMUNICATIONS (SW) LIMITED	 	UK	 	100
	CAW NETWORKS, INC.	 	USA	 	100
	SPIRENT FEDERAL INC	 	USA	 	100
	OPTICAL NETWORK TESTING INC.	 	USA	 	84
	SPIRENT COMMUNICATIONS GSS, INC.	 	USA	 	100
	SPIRENT COMMUNICATIONS OF ROCKVILLE, INC.	 	USA	 	100
	SPIRENT COMMUNICATIONS LIMITED	 	UK	 	100
	HELLERMANN TYTON (PTY) LTD	 	South Africa	 	90
	HELLERMANN TYTON S.A.	 	France	 	100
	HELLERMANN TYTON GMBH	 	Austria	 	100
	HELLERMANN TYTON SRL	 	Argentina	 	100
	HELLERMANNTYTON GMBH	 	Germany	 	100
	HELLERMANN TYTON LTDA	 	Brazil	 	100
	HELLERMANN TYTON PTE LTD	 	Singapore	 	75
	HELLERMANN TYTON DATA LIMITED	 	UK	 	90
	ON-SITE LTD	 	UK	 	90
	HELLERMANNTYTON CORPORATION	 	USA	 	97
	HELLERMANN TYTON AB	 	Sweden	 	100
	HELLERMANN TYTON (NORWAY)	 	Norway	 	100
	HELLERMANN TYTON SRL	 	Italy	 	100
	HELLERMANN TYTON (SPAIN)	 	Spain	 	100
	HELLERMANN TYTON CANADA INCORPORATED	 	Canada	 	97
	HELLERMANN TYTON (AUSTRALIA)	 	Australia	 	100
	HELLERMANN TYTON (CHINA)	 	China	 	75.01
	PG INTERNATIONAL PLC	 	UK	 	100
	PG DRIVES TECHNOLOGY INC.	 	USA	 	100
	SPIRENT SYSTEMS SAN DlEGO INC.	 	USA	 	100
	SPIRENT SYSTEMS WICHITA INC.	 	USA	 	100
	WPDS SOFTWARE LTD	 	UK	 	100
	THE FLIGHT DATA COMPANY LTD	 	UK	 	100
	SPIRENT SYSTEMS (OTTAWA) LTD	 	Canada	 	100
	 	 	 	 	 






 

	PG INTERNATIONAL PLC	 	USA	 	100
	SPIRENT BV	 	Netherlands	 	100
	SPIRENT GMBH	 	Germany	 	100
	SPIRENT HOLDINGS CORPORATION	 	USA	 	100
	SPIRENT INTERNATIONAL INC.	 	USA	 	100
	SPIRENT INC.	 	USA	 	100
	SPIRENT PLC	 	UK	 	100
	NETCOM SYSTEMS HOLDING CORPORATION	 	USA	 	100
	SPIRENT FINANCING CORPORATION	 	USA	 	100
	SPIRENT OVERSEAS LIMITED	 	UK	 	100
	REORG COMPANY 1, INC.	 	USA	 	100
	REORG COMPANY 2, INC.	 	USA	 	100




	(a)
	(ii) Material
Subsidiaries of the Company 






	Name
 
	 	Jurisdiction of Incorporation
	 	Percentage Equity Held

	SPIRENT COMMUNICATIONS OF ROCKVILLE., INC.	 	USA	 	100
	SPIRENT COMMUNICATIONS INC.	 	USA	 	100
	HELLERMANNTYTON GMBH	 	Germany	 	100
	PG INTERNATIONAL PLC	 	UK	 	100
	HELLLERMANNTYTON CORPORATION	 	USA	 	97
	HELLERMANNTYTON DATA LIMITED	 	UK	 	90
	PG DRIVES TECHNOLOGY, INC.	 	USA	 	100
	SPIRENT COMMUNICATIONS OF OTTAWA LIMITED	 	Canada	 	100
	HELLERMANN TYTON CANADA INCORPORATED	 	Canada	 	97
	SPIRENT COMMUNICATIONS LIMITED	 	UK	 	100
	SPIRENT COMMUNICATIONS (SCOTLAND) LIMITED	 	USA	 	100
	SPIRENT HOLDINGS CORPORATION	 	USA	 	100
	SPIRENT INTERNATIONAL INC.	 	USA	 	100
	CAW NETWORKS, INC.	 	USA	 	100
	SPIRENT PLC	 	UK	 	100





        As
at the end of the Accounting Period ending on December 31, 2002, the aggregate of the EBIT and Total Assets of the Material Subsidiaries plus the EBIT and Total Assets of the
Company accounts for at least 80% of Consolidated EBIT and 80% of Consolidated Total Assets for and as at the end of, such accounting period respectively. 


        The
aggregate EBIT and Total Assets of the Company and all such Material Subsidiaries accounts for 971% and 80.4% of Consolidated EBIT and Consolidated Total Assets as at the end of the
Accounting Period ending on December 31, 2002, respectively. 


	(a)
	(iii) Affiliates
(other than Subsidiaries) of the Company



	1.
	Tyton
Company of Japan Ltd (Spirent plc holds 49% of this company)



	2.
	Kyoritsu
Electrics Inds Co Ltd (holds 30% of Tyton Company Japan Limited) 





2





 



	3.
	Sansei
Bussan Co Ltd (holds 21% of Tyton Company of Japan Limited)



	4.
	3M/ECC
Europa BV (Spirent BV holds 20% of this company's shares)



	5.
	3M
Nederland Holding BV (holds 80% of 3M/ECC Europa BV)



	6.
	Mr
CT Rosenberg (holds 10% of Hellermann Tyton (PTY) Limited






	(a)
	(iv) Directors
of the Company



	1.
	John
Weston



	2.
	James
Wyness



	3.
	Goran
Ennerfelt



	4.
	Paul
Cheng



	5.
	Richard
Moley



	6.
	Marcus
Beresford



	7.
	Nicholas
Brookes



	8.
	Eric
Hutchinson



	9.
	My
Chung 



	(d)
	Agreements
restricting the ability of Subsidiaries to pay dividends out of profits or make any other similar distributions of profits to the Company or any Subsidiary (except in the
case of any Subsidiary that is not a Material Subsidiary, where such restriction or agreement could not reasonably be expected to have a Material Adverse Effect)



	1.
	HellermannTyton
Corporation 



Under
a loan agreement between M&I Marshall & Ilsley Bank and HellermannTyton Corporation, there is a tangible net worth covenant which requires the borrower to maintain a certain level of
tangible net worth at all times. The amount of the facility was originally $6,250,000. 



	2.
	Exchange
controls of general applicability 


3









  







  


APPENDIX
I 





 
 

PG SUB GROUP    
    


         

  


APPENDIX
II 







  


APPENDIX
III 





 
 

US SUB GROUP    
    


         

  


APPENDIX
IV 





 
 

OTHER OVERSEAS SUBSIDIARIES    
    


         

  


APPENDIX
V 





 
 

UK DORMANT SUBSIDIARIES    
    


         

  


APPENDIX
VI 





 
 

SCHEDULE 5.5    
    
    FINANCIAL STATEMENTS    
    


	1.
	Spirent
plc Financial Statements for year ending December 31, 2001.



	2.
	Spirent
plc Financial Statements for half-year ending on June 30, 2002, 





 
 

SCHEDULE 5.8    
    
    LITIGATION: OBSERVANCE OF AGREEMENTS, STATUTES AND ORDERS    
    


None.








 
 

SCHEDULE 5.13    
    
    FINANCIAL INDEBTEDNESS AND LIENS AS OF DECEMBER 31, 2002    
    


        FINANCIAL INDEBTEDNESS AS OF 31st DECEMBER 2002 (SPIRENT PLC AND ITS SUBSIDIARIES) 



	 
	 	TOTAL O/DRAFT

FACILITIES

AVAILABLE

(000)
	 	TOTAL LOAN

FACILITIES

AVAILABLE

(000)
	 	OVERDRAFT

BALANCE AS AT

31-Dec-02

(000)
	 	LOAN

BALANCE AS AT

31-Dec-02

(000)
	 	TOTAL

OUTSTANDING

31-Dec-02

(000)

	SECURED	 	2,154	 	4,357	 	492	 	4,357	 	4,849
	UNSECURED	 	7,640	 	330,361	 	88	 	232,131	 	232,219
	FINANCE LEASES	 	9,479	 	9,479	 	 	 	 	 	 
	TOTAL	 	9,794	 	334,718	 	580	 	245,967	 	246,547
	UNSECURED SPIRENT PLC INDEBTEDNESS	 	6,131	 	329,860	 	88	 	231,630	 	231,718
	TOTAL SUBSIDIARY FINANCIAL INDEBTEDNESS	 	3,663	 	4,858	 	492	 	14,337	 	£14,829





        The
above Total Outstanding Debt does not include £1,128 of Debt Issues Costs being amortized over the life of the facilities. 


See
attached working paper. 







SPIRENT PLC AND ITS SUBSIDIARIES  


        FINANCIAL INDEBTEDNESS AS OF 31st DECEMBER 2002. 



	 
	 	TOTAL O/DRAFT

FACILITIES

AVAILABLE

(000)
	 	TOTAL LOAN

FACILITIES

AVAILABLE

(000)
	 	OVERDRAFT

BALANCE AS AT

31-Dec-02

(000)
	 	LOAN

BALANCE AS AT

31-Dec-02

(000)
	 	TOTAL

OUTSTANDING

31-Dec-02

(000)

	SECURED	 	2,154	 	4,357	 	492	 	4,357	 	4,849
	UNSECURED	 	7,640	 	330,361	 	??	 	232,131	 	232,219
	FINANCE LEASES	 	 	 	 	 	 	 	9,479	 	9,479
	TOTAL	 	9,794	 	334,718	 	580	 	245,967	 	246,547
	UNSECURED SPIRENT PLC INDEBTEDNESS	 	6,131	 	329,860	 	8?	 	231,630	 	231,718
	TOTAL SUBSIDIARY FINANCIAL INDEBTEDNESS	 	3,663	 	4,?58	 	492	 	14,337	 	£14,829





        The
above Total Outstanding Debt does not include £1,128 of Debt Issues Costs being amortized over the life of the facilities. 










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SCHEDULE 10.10    
    
    CERTAIN SUBSIDIARY GUARANTORS    
    


        HellermannTyton Data Limited (90%) 


        HellermannTyton
Corporation (97%) 





 
 

SCHEDULE 10.11    
    
    DEFERRED CONSIDERATION OBLIGATIONS    
    


1.     HT Data Limited (formerly RW Data Limited)  


        Put and Call Option Agreement dated 29 February 2000 relating to 10% of the issued share capital of RW Data Limited held by Richard Weatherley and made
between Spirent plc and Richard Weatherley (as amended). 



2.     CAW Networks, Inc.  


        Merger Agreement dated as of 21 July 2002 by and between Spirent plc, Spirent Holdings Corporation, Cancun Acquisition Corporation and Caw
Networks, Inc. If the Company is unable to meet its earn-out commitments pursuant to the Merger Agreement during the period 1 January 2003 to 31 December 2003, the
sellers are entitled to give notice to cure and, if the Company is unable to cure, the Merger Agreement envisages a renegotiation of the revenue targets in favor of the sellers. 



3.     Sontay Limited and Sontay Open Systems Limited  


        Agreement for the sale and purchase of the entire issued share capital of Sontay Limited and Sontay Open Systems Limited dated 16 March 2000. 


4.     HellermannTyton Corporation  


        Stock Purchase Agreement between HellermannTyton Corporation and Dennis Plesha dated 1979 relating to 3% of issued share capital of HellermannTyton Corporation
held by Dennis Plesha. The Agreement was subsequently varied on 1 April 2000. 



5.     HellermannTyton (Pty) Limited  


        Employment Agreement dated 5 May 1976 between HellermanTyton (Pty) Limited and Cliff Rosenberg. 


6.     Spirent DM Limited  


        Investment commitment (in the form of subscriptions for shares, additional share capital and shareholder loan) with respect to Spirent's 40% joint venture
interest in Spirent DM Limited, a Hong Kong corporation; joint venture partner is DMSJV limited, a Hong Kong joint venture formed between Dascom Infotech (Holding) Limited and Metarnet Technologies
Co., Ltd.). 











QuickLinks


SCHEDULE B DEFINED TERMS


SCHEDULE 2.2 ORIGINAL GUARANTORS

SCHEDULE 5.3 DISCLOSURE MATERIALS



SCHEDULE 5.4 SUBSIDIARIES; AFFILIATES, ETC.


PG SUB GROUP

US SUB GROUP

OTHER OVERSEAS SUBSIDIARIES

UK DORMANT SUBSIDIARIES

SCHEDULE 5.5 FINANCIAL STATEMENTS

SCHEDULE 5.8 LITIGATION: OBSERVANCE OF AGREEMENTS, STATUTES AND ORDERS


SCHEDULE 5.13 FINANCIAL INDEBTEDNESS AND LIENS AS OF DECEMBER 31, 2002


SCHEDULE 10.10 CERTAIN SUBSIDIARY GUARANTORS

SCHEDULE 10.11 DEFERRED CONSIDERATION OBLIGATIONS