Document:

EXHIBIT 10.1 (e)

UNCONDITIONAL
GUARANTY  

(UK GUARANTOR)

 

BRIDGE BANK, N.A. (“Lender”) proposes to enter into a loan transaction
with EVOLVING SYSTEMS LIMITED (“Borrower”),
which is a direct, Wholly-Owned Subsidiary of the undersigned guarantor (“Guarantor”).  The loan and other credit extensions are
being made by Lender to Borrower pursuant to a Loan Agreement dated as of February 22,
2008 (as the same now exists or may hereafter be amended, modified,
supplemented, extended, renewed, restated or replaced from time to time (the “Agreement”).  Guarantor expects to derive economic benefit
from Lender’s doing so and dealing with Borrower in accordance with the
Agreement and other Loan Documents.   All
terms used without definition in this Guaranty shall have the meaning assigned
to them in the Agreement.  Terms defined
in the California Uniform Commercial Code as in effect from time to time (the “Code”)
and not otherwise defined in this Guaranty or the Agreement shall have the
meanings defined for those terms in the Code. 
With respect to terms defined in more than one article of the Code,
unless otherwise specified such terms will have the meaning specified in Article 9
of the Code.

 

For and in consideration of the loans and other credit
extensions by Lender to Borrower, and acknowledging that Lender would not enter
into the Agreement without the benefit of this Guaranty (“Guaranty”), Guarantor
hereby unconditionally and irrevocably guarantees the prompt and complete
payment and performance by the Borrower when due (whether at the stated
maturity, by acceleration or otherwise) of the Obligations.

 

NOW, THEREFORE, Guarantor and the Lender agree as
follows:

 

1.             If Borrower does not pay or perform when due any of
the Obligations in strict accordance with the Agreement, Guarantor shall
promptly pay all amounts due thereunder (including, without limitation, all
principal, interest, and fees) and otherwise to proceed to perform the
Obligations.

 

2.             If there is more than one guarantor, the obligations
hereunder are joint and several, and whether or not there is more than one
guarantor, the obligations hereunder are independent of the obligations of
Borrower and any other person or entity, and a separate action or actions may
be brought and prosecuted against Guarantor whether action is brought against
Borrower or whether Borrower be joined in any such action or actions.  Guarantor waives the benefit of any statute
of limitations affecting its liability hereunder or the enforcement thereof, to
the extent permitted by law.  Guarantor’s
liability under this Guaranty is not conditioned or contingent upon the
genuineness, validity, regularity or enforceability of the Agreement.

 

3.             Guarantor authorizes Lender, without notice or demand
to Guarantor and without affecting its liability hereunder, from time to time
in accordance with the applicable provisions of the Agreement and the other
Loan Documents to (a) renew, extend, or otherwise change the terms of the
Agreement or any part thereof; (b) take and hold security for the payment
of this Guaranty or the Agreement, and exchange, enforce, waive and release any
such security; and (c) apply such security and direct the order or manner
of sale thereof as Lender in its sole discretion may determine.

 

4.             Guarantor waives any right to require Lender to (a) proceed
against Borrower, any guarantor or any other person; (b) proceed against
or exhaust any security held from Borrower; or (c) pursue any other remedy
in Lender’s power whatsoever.  Lender
may, at its election, exercise or decline or fail to exercise any right or
remedy it may have against Borrower or any security held by Lender, including
without limitation the right to foreclose upon any such security by judicial or
nonjudicial sale, without affecting or impairing in any way the liability of
Guarantor hereunder.  Guarantor waives
any defense arising by reason of any disability or other defense of Borrower or
by reason of the cessation from any cause whatsoever of the liability of
Borrower other than satisfaction in full of the Obligations.  Guarantor waives any setoff, defense or
counterclaim that Borrower may have against Lender other than satisfaction in
full of the Obligations.  Guarantor
waives any defense arising out of the absence, impairment or loss of any right
of reimbursement or subrogation or any other rights against Borrower.  Until the Obligations have been paid in full
(other than contingent indemnification Obligations to the extent no claim
giving rise thereto has been asserted), Guarantor shall have no right of subrogation
or reimbursement, contribution or other rights against Borrower arising out or
relating to this Guaranty or any sums paid by Guarantor hereunder, and
Guarantor waives any right to enforce any remedy that Lender now has or may
hereafter have against Borrower arising out of or

 

 

relating to this Guaranty
or any sums paid by such Guarantor hereunder. 
Guarantor waives all presentments, demands for performance, notices of
nonperformance, protests, notices of protest, notices of dishonor, and notices
of acceptance of this Guaranty and of the existence, creation, or incurring of
new or additional indebtedness.  
Notwithstanding the foregoing, Guarantor does not hereby waive any
notices specifically required in any Loan Document to which Guarantor is a party
but agrees that the failure of Lender to provide any such notices pursuant to
the provisions of any such Loan Document shall not release or diminish
Guarantor’s obligations, liabilities, agreements or duties hereunder, or
otherwise affect this Guaranty in any way. 
Guarantor assumes the responsibility for being and keeping itself
informed of the financial condition of Borrower and of all other circumstances
bearing upon the risk of nonpayment of any indebtedness or nonperformance of
any obligation of Borrower, warrants to Lender that it will keep so informed,
and agrees that absent a request for particular information by Guarantor,
Lender shall not have any duty to advise Guarantor of information known to
Lender regarding such condition or any such circumstances.  Guarantor waives the benefits of California
Civil Code sections 2809, 2810, 2819, 2845, 2847, 2848, 2849, 2850, 2899 and
3433.  The waivers of rights in this Section 4
are made to the extent permitted by applicable law and are made in favor of Lender
only and its successors and permitted assigns and shall not be deemed a waiver
of such rights for the benefit of any other Person.

 

5.             If Borrower becomes insolvent or is adjudicated
bankrupt or files a petition for reorganization, arrangement, composition or
similar relief under any present or future provision of the United States
Bankruptcy Code or if such a petition is filed against Borrower, and in any
such proceeding some or all of any indebtedness or obligations under the
Agreement are terminated or rejected or any obligation of Borrower is modified
or abrogated, or if Borrower’s obligations are otherwise avoided for any
reason, Guarantor agrees that Guarantor’s liability hereunder shall not thereby
be affected or modified and such liability shall continue in full force and
effect as if no such action or proceeding had occurred.  This Guaranty shall continue to be effective
or be reinstated, as the case may be, if any payment must be returned by Lender
upon the insolvency, bankruptcy or reorganization of Borrower, Guarantor, any
other guarantor, or otherwise, as though such payment had not been made.

 

6.             Until all of the Obligations
(other than contingent indemnification Obligations to the extent no claim
giving rise thereto has been asserted) have been paid in full, any indebtedness
of Borrower now or hereafter held by Guarantor is hereby subordinated to any
indebtedness of Borrower to Lender; provided that so long as no Event of
Default has occurred and is continuing, Guarantor may continue to receive and
retain payments on such obligations and indebtedness provided such payments are
not prohibited under the Agreement. 
During the existence of an Event of Default, such indebtedness of
Borrower to Guarantor shall be collected, enforced and received by Guarantor as
trustee for Lender and, if Lender so requests, be paid over to Lender on
account of the indebtedness of Borrower to Lender but without reducing or
affecting in any manner the liability of Guarantor under the other provisions
of this Guaranty.

 

7.             Guarantor agrees to pay, no later than five Business
Days after written demand therefor, 
reasonable attorneys’ fees and all other costs and expenses which may be
incurred by Lender in the enforcement of this Guaranty and any agreements
executed by Guarantor in connection with this Guaranty (including without
limitation security agreements).  Lender
shall endeavor to provide reasonable supporting documentation for the amount of
any claims under the foregoing sentence. 
No terms or provisions of this Guaranty may be changed, waived, revoked
or amended except by a written instrument executed by Lender and
Guarantor.  Should any provision of this
Guaranty be determined by a court of competent jurisdiction to be unenforceable,
all of the other provisions shall remain effective.  This Guaranty, together with any agreements
(including without limitation any security agreements or any pledge agreements)
executed by Guarantor in connection with this Guaranty, embodies the entire
agreement among the parties hereto with respect to the matters set forth
herein, and supersedes all prior agreements among the parties with respect to
the matters set forth herein.  No course
of prior dealing among the parties, no usage of trade, and no parol or
extrinsic evidence of any nature shall be used to supplement, modify or vary
any of the terms hereof. There are no conditions to the full effectiveness of
this Guaranty.  Lender may assign this
Guaranty to a permitted assignee of Lender under the Agreement without in any
way affecting Guarantor’s liability under it. 
This Guaranty shall inure to the benefit of Lender and its successors
and permitted assigns.  This Guaranty is
in addition to the guaranties of any other guarantors and any and all other
guaranties of Borrower’s indebtedness or liabilities to Lender.

 

8.             Guarantor represents and warrants to Lender that (i) Guarantor
has taken all necessary and appropriate corporate action to authorize the
execution, delivery and performance by Guarantor of this Guaranty and

 

 

(ii) execution,
delivery and performance of this Guaranty by Guarantor do not conflict with or
result in a breach of or constitute a default under (x) Guarantor’s
organizational documents or (y) agreements to which it is party or by
which it is bound, the effect of which default under this clause (y) would
reasonably be expected to result in, either individually or in the aggregate, a
Material Adverse Effect.

 

9.             So long as any Obligation shall remain unpaid (other
than contingent indemnification Obligations to the extent no claim giving rise
thereto has been asserted) and Bank shall have any commitment to make Credit
Extensions under the Agreement, Guarantor will not, except as permitted by the
Agreement or the US Loan Agreement, do any of the following:  (i) it will not directly or indirectly
acquire or own, or make any Investment in or to any Person, or permit any of
its Subsidiaries so to do, other than the shares of Borrower; (ii) it will
not merge or consolidate, or permit any of its Subsidiaries to merge or consolidate,
with or into any other business organization, or acquire, or permit any of its
Subsidiaries to acquire, all or substantially all of the Capital Stock or
property of another Person, other than the shares of Borrower; (iii) that
it will not transfer any of the shares of Borrower to another Person; and (iv) it
will not create, incur, assume or suffer to exist any Lien with respect to any
of its property, or assign or otherwise convey any right to receive income, or
permit any of its Subsidiaries so to do.

 

10.          So long as any Obligation shall remain unpaid (other
than contingent indemnification Obligations to the extent no claim giving rise
thereto has been asserted) and Bank shall have any commitment to make Credit
Extensions under the Agreement, Guarantor shall do all of the following, except
as otherwise permitted under the Agreement or the US Loan Agreement:

 

10.1        Guarantor shall maintain its
existence, remain in good standing in its jurisdiction of organization, and
continue to qualify in each jurisdiction in which the failure to so qualify
would reasonably be expected to have a material adverse effect on the business
operations or condition (financial or otherwise) of Guarantor.  Guarantor shall maintain in force all
licenses, approvals and agreements, the loss of which would reasonably be
expected to have a material adverse effect on its business operations or
condition (financial or otherwise).

 

10.2        Guarantor shall comply in
all material respects with the provisions of its organizational documents, and
shall not amend any such documents in any manner materially adversely affecting
Lender without Lender’s prior written consent, which will not be unreasonably
withheld.  Guarantor shall comply with
all statutes, laws, ordinances, directives, orders, and government rules and
regulations to which it is subject if non-compliance with such laws would
reasonably be expected to materially adversely affect the business operations
or condition (financial or otherwise) of Guarantor.

 

11.          This Guaranty shall be governed by the laws of the
State of California, without regard to conflicts of laws principles.  GUARANTOR WAIVES ANY RIGHT TO A JURY TRIAL OF
ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF THIS GUARANTY OR ANY
OF THE TRANSACTIONS CONTEMPLATED THEREIN, INCLUDING CONTRACT CLAIMS, TORT
CLAIMS, BREACH OF DUTY CLAIMS, AND ALL OTHER COMMON LAW OR STATUTORY
CLAIMS.  Guarantor submits to the
jurisdiction of the state and federal courts located in Santa Clara County,
California for purposes of this Guaranty and the Agreement.  If the jury waiver in this Section is
for any reason unenforceable, Lender and Guarantor will resolve all disputes by
reference to a referee pursuant to Code of Civil Procedure Section 638 et
seq, sitting without a jury, such referee to be by mutual agreement or, if
none, as selected by the Presiding Judge of the California Superior Court for
Santa Clara County.

 

12.          All payments made by Guarantor hereunder
will be made free and clear of, and without deduction or withholding for, any
present or future taxes, levies, imposts, duties, fees, assessments or other
charges of whatever nature now or hereafter imposed by any governmental
authority or by any political subdivision or taxing authority thereof or
therein with respect to such payments (but excluding any tax imposed on or
measured by the net income or profits of a bank pursuant to the laws of the
jurisdiction in which it is organized or the jurisdiction in which the
principal office or applicable lending office of such bank is located or any
subdivision thereof or therein) and all interest, penalties or similar
liabilities with respect thereto (all such non-excluded taxes, levies, imposts,
duties, fees, assessments or other charges being referred to collectively as “Taxes”).  If any Taxes are so levied or imposed,
Guarantor agrees to pay the full amount of such Taxes, and such additional
amounts as may be necessary so that every payment of all amounts due under this
Guaranty, after withholding or deduction for or on account of

 

 

any Taxes, will
not be less than the amount provided for herein and in the Agreement and
related loan documents.  Notwithstanding,
the foregoing provisions of this Section 12, Guarantor shall have the full
benefits and rights afforded to Borrower in Section 12.4 of the Agreement
with respect to any and all payments made by Guarantor under this Guaranty.

 

13.          This Guaranty
is secured by that certain Charge Over Shares, dated as of the date hereof,
between Guarantor and Lender which is governed by English law, pursuant to
which Guarantor has pledged to Lender the shares of Borrower.

 

IN WITNESS WHEREOF, the undersigned Guarantor has executed this Guaranty
as a Deed as of February 22, 2008.

 

	
   

  	
  EXECUTED and DELIVERED AS A
  DEED for and on behalf of:

  
	
   

  	
   

  	
   

  
	
   

  	
  EVOLVING SYSTEMS HOLDINGS
  LIMITED

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Name:

  	
  Brian R. Ervine

  
	
   

  	
   

  	
   

  
	
   

  	
  Title: Director

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Name:

  	
  Anita T. Moseley

  
	
   

  	
   

  	
   

  
	
   

  	
  Title: SecretaryExhibit 10.1 (f)

 

DATED  22 
FEBRUARY  2008

 

 

EVOLVING
SYSTEMS HOLDINGS LIMITED

 

and

 

BRIDGE
BANK, N.A.

 

 

CHARGE OVER
SHARES

 

 

 

 

 

19 Cavendish Square

London W1A 2AW

 

DX 42748
Oxford Circus North

 

telephone  +44(0)20 7636 1616

 

fax  +44 (0)20 7491 2899

 

Ref :
028176/00002/H3326944.4

 

 

CONTENTS

 

	
  Clause

  	
   

  	
  Heading

  	
   

  	
  Page No.

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1.

  	
   

  	
  DEFINITIONS AND INTERPRETATION

  	
   

  	
  1

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  2.

  	
   

  	
  COVENANT TO PAY

  	
   

  	
  6

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  3.

  	
   

  	
  INTEREST

  	
   

  	
  6

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  4.

  	
   

  	
  SECURITY

  	
   

  	
  6

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  5.

  	
   

  	
  FURTHER ASSURANCE

  	
   

  	
  6

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  6.

  	
   

  	
  DEPOSIT OF DOCUMENTS AND TITLE
  DEEDS

  	
   

  	
  7

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  7.

  	
   

  	
  NEGATIVE PLEDGE

  	
   

  	
  8

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  8.

  	
   

  	
  DIVIDENDS, VOTING RIGHTS AND
  NOMINEES

  	
   

  	
  8

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  9.

  	
   

  	
  REPRESENTATIONS AND WARRANTIES

  	
   

  	
  10

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  10.

  	
   

  	
  UNDERTAKINGS

  	
   

  	
  11

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  11.

  	
   

  	
  COSTS UNDERTAKING

  	
   

  	
  13

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  12.

  	
   

  	
  DEFAULT

  	
   

  	
  13

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  13.

  	
   

  	
  STATUTORY POWER OF SALE

  	
   

  	
  14

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  14.

  	
   

  	
  PROTECTION OF THIRD PARTIES

  	
   

  	
  14

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  15.

  	
   

  	
  NO LIABILITY AS MORTGAGEE IN POSSESSION

  	
   

  	
  15

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  16. 

  	
   

  	
  POWER OF ATTORNEY 

  	
   

  	
  15 

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  17.

  	
   

  	
  CUMULATIVE AND CONTINUING SECURITY

  	
   

  	
  16

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  18.

  	
   

  	
  AVOIDANCE OF PAYMENTS

  	
   

  	
  16

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  19.

  	
   

  	
  PRIOR CHARGES

  	
   

  	
  17

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  20.

  	
   

  	
  OPENING A NEW ACCOUNT

  	
   

  	
  17

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  21.

  	
   

  	
  SUSPENSE ACCOUNT

  	
   

  	
  17

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  22.

  	
   

  	
  PAYMENTS AND WITHHOLDING TAXES

  	
   

  	
  17

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  23.

  	
   

  	
  CURRENCY

  	
   

  	
  18

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  24.

  	
   

  	
  SET-OFF

  	
   

  	
  19

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  25.

  	
   

  	
  ASSIGNMENT

  	
   

  	
  19

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  26.

  	
   

  	
  WAIVERS

  	
   

  	
  19

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  27.

  	
   

  	
  SEVERABILITY

  	
   

  	
  20

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  28.

  	
   

  	
  NOTICES

  	
   

  	
  20

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  29. 

  	
   

  	
  COUNTERPARTS AND DELIVERY 

  	
   

  	
  20 

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  30.

  	
   

  	
  LAW AND JURISDICTION

  	
   

  	
  21

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

 

THIS CHARGE
is made as a Deed the 22nd day of February 2008

 

BETWEEN:

 

(1)                                  EVOLVING SYSTEMS HOLDINGS
LIMITED (registered
in England and Wales under company number 05272751 the
registered office of which is at One Angel Square, Torrens Street, London EC1V
1PL (the “Chargor”); and

 

(2)                                  BRIDGE BANK, N.A. of 55 Almaden Boulevard, San
Jose, A 95113, United States of America (the “Bank”).

 

RECITALS

 

(A)                              The
Bank has agreed to make available to the Borrower (as defined below) a
revolving loan facility of up to US$5,000,000 (five million American dollars)
subject to and upon the terms and conditions contained in the Loan Agreement
(as defined below).

 

(B)                                The
Chargor entered into a Guaranty dated the date of this Charge in favour of the
Bank in respect of the liabilities of the Borrower to the Bank (the “Guaranty”).

 

(C)                                The
Bank requires the Chargor, and the Chargor has agreed, to enter into this
Charge for the purpose of providing security to the Bank for the Secured
Liabilities (as defined below).

 

IT IS
AGREED as follows:

 

1.                                     DEFINITIONS
AND INTERPRETATION

 

1.1                            Definitions

 

In this Charge the following expressions have the following meanings,
unless the context otherwise requires:

 

	
  “Act”

  	
  means the Law of Property Act 1925.

  
	
   

  	
   

  
	
  “Borrower”

  	
  means Evolving Systems
  Limited (registered in England and Wales under company number 02325854) the
  registered office of which is at One Angel Square, Torrens Street, London
  EC1V 1PL.

  
	
   

  	
   

  
	
  “Charged Property”

  	
  means the whole or any
  part of the property, assets, income and undertaking of the Chargor from time
  to time mortgaged, 

  
	
   

  	
  charged or assigned to the
  Bank pursuant to this Charge.

  

 

1

 

	
  “Costs”

  	
  means all costs, charges
  or expenses of whatsoever nature (including, without limitation, legal fees)
  including, without limitation, disbursements and any Value Added Tax to be
  charged on such costs, charges, expenses and disbursements.

  
	
   

  	
   

  
	
  “Default Rate”

  	
  means the annual rate of
  interest specified in the second sentence of Cause 2.3(b) of the Loan
  Agreement.

  
	
   

  	
   

  
	
  “Derivative Assets”

  	
  means all stocks, shares,
  warrants or other securities, tights, dividends, interest or other property
  (whether of a capital or income nature) accruing, offered, issued or deriving
  at any time by way of dividend, bonus, redemption, exchange, purchase,
  substitution, conversion, consolidation, subdivision, preference, option or
  otherwise attributable to any of the Shares or any Derivative Assets
  previously described.

  
	
   

  	
   

  
	
  “Event of Default”

  	
  means any of those events
  or circumstances set out in Clause 8 (Events of Default) of the Loan
  Agreement and an Event of Default is “continuing” if it has not been remedied
  to the satisfaction of the Bank or waived by it in writing.

  
	
   

  	
   

  
	
  “Facility Documents”

  	
  means this Charge, the
  Loan Agreement, the Guaranty and each of the Security Documents.

  
	
   

  	
   

  
	
  “Future Shares”

  	
  means all shares and other
  securities issued to the Chargor as a result of its ownership of the Shares.

  
	
   

  	
   

  
	
  “Insolvency Act”

  	
  means the Insolvency Act
  1986.

  

 

2

 

	
   

  	
   

  
	
  “Loan Agreement”

  	
  means the Loan Agreement
  dated the date of this Charge and made between the Bank (1) and the
  Borrower (2).

  
	
   

  	
   

  
	
  “LPA”

  	
  means the Law of Property
  Act 1925.

  
	
   

  	
   

  
	
  “Material Adverse Effect”

  	
  has the meaning given to
  it in the Loan Agreement (as if “Loan Agreement”
  and “Collateral” there were Facility
  Documents and Charged Property respectively and with such other changes as
  are necessary to fit the context).

  
	
   

  	
   

  
	
  “Nominees”

  	
  means the Bank, its
  agents, nominees and any other person holding the Shares and the Derivative
  Assets on behalf of the Bank from time to time.

  
	
   

  	
   

  
	
  “Permitted Lien”

  	
  shall have the same
  meaning as in the Loan Agreement.

  
	
   

  	
   

  
	
  “Receiver”

  	
  means a receiver appointed
  pursuant to this Charge or to any applicable law, whether alone or jointly,
  and includes a receiver and/or manager.

  
	
   

  	
   

  
	
  “Reservations”

  	
  means the principle that
  equitable remedies may be granted or refused at the discretion of the Court,
  the limitation on enforcement by laws relating to the bankruptcy, insolvency,
  liquidation, reorganisation, court schemes, moratoria, administration and
  other laws generally affecting the rights of creditors.

  
	
   

  	
   

  
	
  “Secured Liabilities”

  	
  means all moneys, debts
  and liabilities from time to time due, owing or incurred by the Chargor to
  the Bank on any current or other account whatsoever pursuant to the Facility
  Documents in each case:

  
	
   

  	
   

  
	
   

  	
  (a)whether present or
  future;

  

 

3

 

	
   

  	
  (b)     whether alone or jointly
  with any other person;

  
	
   

  	
   

  
	
   

  	
  (c)     whether actual or
  contingent;

  
	
   

  	
   

  
	
   

  	
  (d)     whether as principal or
  as surety;

  
	
   

  	
   

  
	
   

  	
  (e)     in whatsoever name, firm
  or style;

  
	
   

  	
   

  
	
   

  	
  (f)      in whatsoever currency
  denominated; or

  
	
   

  	
   

  
	
   

  	
  (g)     otherwise

  
	
   

  	
   

  
	
   

  	
  together with interest to
  the date of payment at such rates and upon such terms as set forth in the
  Loan Agreement and all commission, fees, costs (including, without
  limitation, legal fees) and other charges.

  
	
   

  	
   

  
	
  “Security Documents”

  	
  means any document entered
  into by any person from time to time creating any Security Interest, directly
  or indirectly, for the obligations of the Borrower under the Facility
  Documents including, without limitation, this Charge and the Guaranty.

  
	
   

  	
   

  
	
  “Security Interest”

  	
  means any mortgage,
  charge, assignment, pledge, lien, right of set-off, hypothecation,
  encumbrance, priority or other security interest (whether fixed or floating)
  including, without limitation, any “hold-back” or “flawed asset” arrangement
  together with any preferential right, retention of title, deferred purchase,
  leasing, sale or purchase, sale and leaseback arrangement, trust agreement,
  declaration of trust, trust arising by operation of law, any option or
  agreement for any of the same or any arrangement which has substantially the
  same commercial or substantive effect as the creation of security.

  
	
   

  	
   

  
	
  “Shares”

  	
  means all stocks, shares
  and other securities 

  

 

4

 

	
   

  	
  listed in the Schedule
  (The Shares) whether held in the United Kingdom or elsewhere and irrespective
  of whether in any such case the deposit was made or the certificates or other
  documents were received by the Bank or its Nominees for the purposes of
  creating security, safe custody, collection or otherwise.

  

 

1.2                            Interpretation

 

1.2.1                        In this Charge:

 

(a)                                  the Contents page and clause headings
are included for convenience only and do not affect the construction of this
Charge;

 

(b)                                 words denoting the singular include the
plural and vice versa; and

 

(c)                                  words denoting one gender include each
gender and all genders.

 

1.2.2                        In this Charge, unless the context otherwise requires,
references to:

 

(a)                                  persons include references to natural
persons, firms, partnerships, companies, corporations, associations,
organisations and trusts (in each case whether or not having a separate legal
personality);

 

(b)                                 documents, instruments and agreements
(including, without limitation, this Charge and any document referred to in
this Charge) are references to such documents, instruments and agreements as
modified, amended, varied, supplemented or novated from time to time;

 

(c)                                  receivers are references to receivers of
whatsoever nature including, without limitation, receivers and managers and
administrative receivers;

 

(d)                                 the term the “Bank” includes, where the
context so admits, references to any delegate of any such person;

 

(e)                                  a party to this Charge include references
to its successors, transferees and assigns;

 

(f)                                    Recitals, Clauses and Schedules are
references to recitals to this Charge, clauses of this Charge and schedules to
this Charge; and references to this Charge include its Schedules;

 

5

 

(g)                                 statutory provisions (where the context so
admits and unless otherwise expressly provided) are construed as references to
those provisions as respectively amended, consolidated, extended or re-enacted
from time to time, and to any orders regulations instruments or other
subordinate legislation made under the relevant statute; and

 

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

 

1.3                            Loan
Agreement defined terms

 

Unless otherwise defined in this Charge, terms defined in the Loan
Agreement bear the same meaning in this Charge.

 

2.                                     COVENANT
TO PAY

 

The Chargor shall on demand pay to the Bank or discharge, as the case
may be, all the Secured Liabilities when the Secured Liabilities become due.

 

3.                                     INTEREST

 

The Chargor shall pay to the Bank interest on the Secured Liabilities
(after as well as before any demand made or judgment obtained or the
liquidation or administration of the Borrower) at the rates and upon the terms
set forth in Clause 2.3(a) of the Loan Agreement or if applicable the
Default Rate and shall be compounded and computed in accordance with such
Clause 2.3.

 

4.                                     SECURITY

 

By way of continuing security in favour of the Bank for the payment and
discharge of the Secured Liabilities, the Chargor with full title guarantee
hereby charges to the Bank by way of first fixed charge, the Shares and
Derivative Assets.

 

5.                                     FURTHER ASSURANCE

 

The Chargor shall:

 

5.1                            promptly, at any time if so required by the
Bank, at its own expense execute and deliver to the Bank such further legal or
other mortgages, charges, assignments, 

 

6

 

securities, authorities and documents as
the Bank may in its reasonable discretion require of the whole
or such part of the Charged Property as the Bank may specify, in such form as
the Bank may in its reasonable discretion require, to secure the payment or
discharge of the Secured Liabilities, including, without limitation, in order
to vest the whole or such part of the Charged Property in the Bank, the nominee
of the Bank or in any purchaser from the Bank or the Receiver;

 

5.2                            pending the execution and
delivery of any such assignments, hold such Charged Property upon trust for the
Bank subject to the provisions of this Charge; and

 

5.3                            pending the execution and
delivery of any such mortgages, charges, or other security, hold such Charged
Property subject to the provisions of this Charge.

 

6.                                     DEPOSIT
OF DOCUMENTS AND TITLE DEEDS

 

6.1                            The Chargor shall deposit with the Bank
(and the Bank during the continuance of this security may hold and retain) all
stock or share certificates or other documents of title to or representing the
Shares and the Derivative Assets together with such duly executed transfers or
assignments with the name of the transferee, date and consideration left blank
as the Bank may require to enable the Bank to vest the same in the Bank (or the
Nominees as the Bank may require) or, after the occurrence of an Event of
Default, any purchaser to the intent that the Bank may, at any time after the
occurrence of an Event of Default without notice, present them for
registration.

 

6.2                            The Chargor shall:

 

6.2.1                        upon the occurrence of an Event of Default which is
continuing procure the registration in the books of the Borrower of the
transfer of the Shares and the Derivative Assets to the Bank (or the Nominees
as the Bank may require), the entry of the Bank (or the Nominees as the Bank
may require) in the register of members of the Borrower as the holder or
holders of the Shares and the Derivative Assets, and the issue of new share
certificates in respect of the Shares and the Derivative Assets to the Bank (or
the Nominees as the Bank may require); and

 

6.2.2                        upon the accrual, offer, issue or receipt of any
Derivative Assets deliver or pay to the Bank or procure the delivery or payment
to the Bank of all such Derivative Assets or the stock or share certificates or
other documents of title to or representing them together with such duly
executed transfers or assignments with the name of the transferee, date and
consideration left blank as the Bank may require to enable the Bank to vest the
same in the 

 

7

 

Bank or the Nominees or, after the
occurrence of an Event of Default which is continuing, any purchaser to the
intent that the Bank may at any time after the occurrence of an Event of
Default which is continuing without notice present them for registration.

 

7.                                     NEGATIVE
PLEDGE

 

The Chargor shall not:

 

7.1                            create, purport to create or
allow to subsist, any Security Interest over the whole or any part of the
Charged Property except for any Permitted Lien;

 

7.2                            convey, assign, transfer, or
agree to convey, assign or transfer the whole or any part of the Charged
Property; or

 

7.3                            permit or agree to any
variation of the rights attaching to the whole or any part of the Charged
Property which is adverse to the interests of the Bank in its reasonable
opinion.

 

8.                                     DIVIDENDS,
VOTING RIGHTS AND NOMINEES

 

8.1                            Dividends and voting rights

 

For so long as no Event of Default has occurred and is continuing, the
Borrower may:

 

8.1.1                        subject to Clause 6.2.2 (Deposit of Documents and
Title Deeds), receive and retain all dividends paid or payable
in cash other than dividends paid or payable in respect of any of the Charged
Property in connection with a partial or total liquidation or dissolution of
the Company or in connection with a reduction of capital, capital surplus or
paid-in-surplus of the Company or paid, payable or otherwise distributed in
redemption of, or in exchange for, any Charged Property, interest and other income
deriving from and received by it in respect of the Shares and the Derivative
Assets; and

 

8.1.2                        exercise all voting and other rights and powers
attached to the Shares and the Derivative Assets PROVIDED THAT such exercise
does not adversely affect the Shares and the Derivative Assets and is not
otherwise inconsistent with this Charge or is in breach of any of the
provisions of any of the Facility Documents.and PROVIDED FURTHER THAT the
Chargor shall promptly following receipt, forward to the Bank copies of any
notice for an extraordinary or annual general meeting of the company which has
issued the Shares or Derivative Assets (as the case may be) at which
resolutions are proposed to either (a) to place the company into any form
of winding up, or (b) to apply for 

 

8

 

an administration order, or (c) to
apply for an automatic moratorium under the Insolvency Act .

 

8.2                            Trustee
powers

 

The Bank may at its discretion (in the name of the Chargor or
otherwise, after the occurrence of an Event of Default which is continuing and
without any consent or authority on the part of the Chargor) exercise all the
powers given to trustees by Section 10(3) and (4) of the Trustee
Act 1925 (as amended by Section 9 of the Trustee Investments Act 1961) in
respect of those Shares and the Derivative Assets subject to a trust.

 

8.3                            Bank’s powers
of enforcement over Shares and the Derivative Assets

 

8.3.1                        Following the occurrence of an Event of Default which
is continuing, all dividends, interest and other income forming part of the
Shares and the Derivative Assets shall, unless otherwise agreed between the
Bank and the Chargor, be paid without any set-off or deduction whatsoever to an
interest bearing suspense account in the name of the Bank and shall be retained
by the Bank until applied as hereinafter provided as part of the Shares and the
Derivative Assets and any such monies which may be received by the Chargor
shall,
pending such payment, be held in trust for the Bank.

 

8.3.2                        The Bank shall not have any duty as to any Shares and
Derivative Assets and shall incur no liability for:

 

(a)                                  ascertaining or taking action in respect of
any calls instalments, conversions, exchanges, maturities, tenders or other
matters in relation to any Shares and Derivative Assets or the nature or
sufficiency of any payment whether or not the Bank has or is deemed to have
knowledge of such matters; or

 

(b)                                 taking any necessary steps to preserve
rights against prior parties or any other rights pertaining to any Shares and
Derivative Assets; or

 

(c)                                  for any failure to present any interest,
coupon or any bond or stock drawn for repayment or for any failure to pay any
call or instalment or to accept any offer or to notify the Chargor of any such
matter or for any failure to ensure that the correct amounts (if any) are paid
or received in respect of the Shares and the Derivative Assets.

 

9

 

 

8.4                          Custody

 

The Bank shall be entitled to provide for the safe custody by third
parties of all stock and share certificates and documents of title deposited
with the Bank or the Nominees as the Bank may require at the expense of the
Chargor and shall not be responsible for any loss of or damage to any such
certificates or documents.

 

 

9.                                     REPRESENTATIONS
AND WARRANTIES

 

9.1                          The Chargor represents and
warrants to the Bank that:

 

9.1.1                        Ownership of the Charged
Property

 

it is absolutely, solely and beneficially entitled to all the Charged
Property as from the date it or any part of it falls to be charged under this
Charge and the rights of the Chargor in respect of the Charged Property are
free from any Security Interest of any kind other than a Permitted Lien;

 

9.1.2                        Powers and authority

 

it has the power to enter into and perform, and has taken all necessary
action to authorise the entry into, performance and delivery of, the Facility
Documents to which it is or will be a party and the transactions contemplated
by those Facility Documents;

 

9.1.3                        Legal Validity

 

subject to Reservations, each Facility Document to which it is a party
constitutes, or when executed in accordance with its terms will constitute, its
legal, valid and binding obligation enforceable in accordance with its terms.

 

9.1.4                        Non-conflict

 

the entry into, and the performance by it of the Facility Documents to
which it is a party are not in conflict with nor constitute a breach of any
provision contained in Chargor’s Organizational Documents, and will not
constitute an event of default under any agreement to which Chargor is a party
or by which Chargor is bound, the effect of which would reasonably be expected
to result in, either individually or in the aggregate, a Material Adverse
Effect.

 

10

 

9.1.5                        No disposal

 

it has not sold or agreed to sell or otherwise disposed of, or agreed
to dispose of, the benefit of all or any of the Chargor’s right, title and
interest in and to the Charged Property; and

 

9.1.6                        The Shares

 

(a)                                  all the Shares are issued and
fully paid up, or credited as fully paid up, and as at the date of this Charge
constitute the entire issued share capital of the Company and are free from any
Security Interest;

 

(b)                                 neither it nor any other
person has done any act in relation to its acquisition of any Shares as from
the date they fall to be charged pursuant to the terms of this Charge which
would involve a breach of Section 151 of the Companies Act 1985 or its
equivalent in any other jurisdiction; and

 

(c)                                  the Shares have been duly
authorised and validly issued and are free from any restriction or transfer on
rights of pre-emption;

 

9.2                          The representations and warranties set forth in
this Clause are given and made on and as of the date of this Charge, shall
survive the execution of this Charge and are continuing representations and
warranties which are deemed to be repeated at each time the representations and
warranties in the Loan Agreement are deemed to be repeated.

 

 

10.                              UNDERTAKINGS

 

The Chargor gives each of the undertakings contained in this Clause to
the Bank.

 

10.1                    Duration

 

The undertakings in this Clause shall remain in force during the
continuance of the security constituted by this Charge.

 

10.2                    To comply
with statutes

 

The Chargor shall comply with all requirements of any duly empowered
authority, all obligations under any statute and all byelaws and regulations
relating to it or the whole or any part of the Charged Property , in each case,
non-compliance with which would reasonably be expected to have a Material
Adverse Effect.

 

11

 

10.3                    To provide
information

 

The Chargor shall furnish to the Bank promptly on demand by the Bank
such information and supply such documents or papers relating to the Charged
Property from time to time as the Bank may in its reasonable discretion
require.

 

10.4                    The Shares
and the Derivative Assets

 

The Chargor shall:

 

10.4.1               duly and promptly pay all calls,
instalments or other payments which may be made or become due in respect of any
of the Shares and the Derivative Assets as and when the same become due. The
Chargor agrees that, if it fails to do so, the Bank may, in its discretion,
make such payments. The Chargor shall reimburse the Bank for the amount of such
payments on demand. Such amounts will bear interest at the Default
Rate in
accordance with Clause 3 (Interest) from the date of payment by the Bank until
the date of reimbursement;

 

10.4.2               immediately inform the Bank of any
acquisition by the Chargor of any shares in the Borrower by transfer, issue or
any other means whatsoever, including details of the date of the acquisition
and any transferor;

 

10.4.3               except with the prior written consent of
the Bank, not permit any person other than the Chargor to be registered as
holder of all or any part of the Shares and the Derivative Assets;

 

10.4.4               except with the prior written consent of
the Bank, not cause or permit to be issued any additional shares of the
Borrower or any securities convertible into, or carrying rights to subscribe
for, shares of the Borrower;

 

10.4.5               if the Bank gives its prior written consent
to an issue of shares pursuant to Clause 10.4,4, enter into such security
documentation as the Bank may in its absolute discretion require or shall
procure that the beneficial and/or the registered owners enter into such
security documentation as the Bank may in its discretion require in respect of
all such additional shares or securities;

 

10.4.6               except with the prior written consent of the
Bank, not exercise any right it may have against the Borrower (except such
rights as may be specifically conferred on the Chargor by this Charge) except
on such terms and in such manner as the Bank may in its discretion require and,
if it does so in contravention of this Clause, it shall hold any amount
received or recovered by it as a result of such exercise on trust for the Bank;

 

10.4.7               on demand by the Bank transfer all or any
part of the Shares and the Derivative Assets to such Nominees as the Bank may
in its discretion select.

 

12

 

11.                              COSTS
UNDERTAKING

 

The Chargor shall promptly on demand pay or reimburse to the Bank the
amount of all reasonable Costs incurred by the Bank (which shall form part of
the Secured Liabilities) in connection with:

 

11.1.1               the negotiation, preparation, printing,
execution, registration, perfection and completion of this Charge, the Charged
Property or any document referred to in this Charge; or

 

11.1.2               any actual or proposed amendment or
extension of or any waiver or consent under this Charge.

 

11.2                    The Chargor shall promptly pay
on demand to the Bank the amount of all Costs in any way incurred by the Bank
in relation to the protection, enforcement or preservation
of any of the Bank’s rights under this Charge (including, without limitation,
the costs of any proceedings in relation to this Charge) all of which shall
form part of the Secured Liabilities. .

 

 

12.                              DEFAULT

 

12.1                    Enforcement

 

This Charge will become enforceable on the occurrence of any Event of
Default which is continuing or if the Chargor requests the Bank to appoint a
receiver over the whole or any part of the Charged Property.

 

12.2                    Consequences
of default

 

At any time after this Charge has become enforceable, the Bank may
(without prejudice to any other of its rights and remedies and without notice
to the Chargor) do all or any
of the following:

 

(a)                                  exercise all the powers and
rights conferred on mortgagees by the Act, as varied and extended by this
Charge, without the restrictions contained in sections 103 or 109(1) of
the Act; and

 

(b)                                 subject to Clause 12.3,
appoint one or more persons to be a Receiver or Receivers of all or any of the
Charged Property.

 

12.3                    Powers of Receiver

 

Every
Receiver shall have all the powers:

 

12.3.1               of
the Bank under this Charge;

 

13

 

12.3.2               conferred
by the Act on mortgagees in possession and on receivers appointed under the
Act;

 

12.3.3               in
relation to, and to the extent applicable to, the Charged Property, the powers
specified in Schedule 1 of the Insolvency Act 1986 (whether or not the Receiver
is an administrative receiver within the meaning of that Act); and

 

12.3.4               in
relation to any of the Charged Property, which he would have if he were its
only beneficial owner.

 

 

13.                              STATUTORY POWER OF SALE

 

13.1                    For
the purposes of all powers implied by statute, and in particular the power of
sale under Section 101 of the LPA (Powers incident to estate or interest
in a mortgage), the Secured Liabilities will be deemed to have become due when
the security created by this Charge becomes enforceable and Section 103 of
the LPA (Regulation of exercise of power of sale) and Section 93 of the
LPA (Restriction on consolidation of mortgages) will not apply.

 

13.2                    The
Bank may exercise its statutory power of sale in respect of the whole or any
part of the Charged Property.

 

 

14.                              PROTECTION OF THIRD PARTIES

 

14.1                    Any
person (including, without limitation, any purchaser, mortgagor or mortgagee)
(in this Clause a “purchaser”) dealing with the Bank may assume without inquiry
that:

 

14.1.1               some
part of
the Secured Liabilities has become due;

 

14.1.2               a demand for such Secured Liabilities has
been duly made; and

 

14.1.3               such Secured
Liabilities have become due within the meaning of Section 101 of the LPA
(Powers incident to estate or interest in a mortgage).

 

14.2                    No
purchaser dealing with the Bank is to be concerned to enquire whether any power
exercised or purported to be exercised by the Bank has become exercisable, or
as to the propriety or regularity of any sale by, or other dealing with the
Bank. Any such sale or dealing is deemed to be within the powers conferred by
this Charge and to be valid and effective accordingly. All the protection to
purchasers contained in Section 104 (Conveyance on sale) and Section 107
(Mortgagee’s receipt, discharges etc.) of 

 

14

 

the LPA and Section 42(3) of the Insolvency Act
(Prohibition upon enquiry into administrative receiver’s powers) apply to any
purchaser.

 

 

15.                              NO LIABILITY AS MORTGAGEE IN POSSESSION

 

15.1                    Mortgagee’s liability

 

The Bank is not:

 

15.1.1               liable
to account
as mortgagee in possession in respect of the Charged Property; or

 

15.1.2               liable for any loss upon realisation or
exercise of any power, authority or right of the Bank arising under this
Charge, nor for any act, default,
neglect, or misconduct of any nature whatsoever save to the extent of its own
fraud, wilful default or gross negligence.

 

15.2                    Possession

 

If the Bank enters into
possession of the Charged Property, such person may at any time go out of
possession at the discretion of such person.

 

 

16.                              POWER OF ATTORNEY

 

16.1                    The
Chargor irrevocably appoints, by way of security the Bank and each person
deriving title from the Bank, jointly and severally to be its attorney (with
full power to appoint substitutes and to sub-delegate) for it, in its name, on
its behalf and as its act and deed or otherwise to sign or execute any deed or
document or do any act or thing which the Chargor is, or may become, obliged to
(but does not in a timely fashion) sign, execute or do pursuant to this Charge
or which the Bank or any person deriving title from the Bank may in the
discretion of such person think fit in connection with the exercise of any of
the powers of such person or the realisation of any security constituted by
this Charge.

 

16.2                    Without
prejudice to the generality of the foregoing, the Chargor unconditionally
undertakes to the Bank, and separately to each person deriving title from the
Bank, that it shall ratify and confirm anything done or purported to be done by
any attorney appointed pursuant to this Clause.

 

16.3                    The
Bank
agrees that the power of attorney provided under this Clause 16 shall only be
relied upon and exercised by such person after the occurrence of an Event of
Default which  is continuing.

 

15

 

17.                              CUMULATIVE AND CONTINUING SECURITY

 

17.1                    This
Charge is a continuing security to the Bank regardless of any intermediate
payment or discharge of the whole or any part of the Secured Liabilities and
will not be prejudiced or affected by any act, omission or circumstance which,
but for this Clause, might affect or diminish its effectiveness.

 

17.2                    The
security constituted by this Charge is in addition to, is not in substitution
for, is without prejudice to, and does not merge with, any rights whatsoever
which the Bank may have, whether in respect of the Secured Liabilities or
otherwise, including, without limitation, any rights arising under any other
Security Interest, any bill, note, guarantee, contract or applicable rule of
law.

 

17.3                    Any
receipt, release or discharge of the security constituted by, or of any
liability arising under, this Charge shall not release or discharge the Chargor
from any liability which may exist independently of this Charge to the Bank.

 

17.4                    Where
the security constituted by this Charge initially takes effect as a collateral
or additional security to any other Security Interest held by the Bank then,
notwithstanding any receipt, release or discharge given in respect of such
other Security Interest, this Charge shall take effect as an independent
security for any monies, liabilities or other sums secured by such other
Security Interest.

 

17.5                    Subject
to Clause
18.1 (Avoidance of payments) upon irrevocable discharge in full of the Secured
Liabilities the Bank shall reassign to the Chargor all the Chargor’s rights.
title, interest and benefit in and to the Charged Property and the Bank shall,
at the request and cost of the Chargor, take whatever action is necessary to
release or re-assign the Charged Property from this Charge.

 

 

18.                              AVOIDANCE OF PAYMENTS

 

18.1                    No
assurance, security or payment which may be avoided under the law or subject to
an order of the court made under any law relating to bankruptcy, insolvency,
administration or winding-up, including, without limitation the Insolvency Act,
and no release, settlement or discharge given or made by the Bank on the faith
of any such assurance, security or payment, prejudices or affects the right of
the Bank:

 

18.1.1               to
recover any monies from the Chargor (including, without limitation, any monies
which it is compelled to refund under any law and any Costs payable by it incurred in
connection with such process); or

 

18.1.2               to enforce the security
constituted by this Charge to the full extent of the Secured Liabilities.

 

16

 

19.                              PRIOR CHARGES

 

19.1                    If
there subsists any prior Security Interest against the Charged Property and
either any step is taken to exercise any power or remedy conferred by such
Security Interest or the Bank exercises any power of sale pursuant to this
Charge, the Bank may redeem such prior Security Interest or procure the
transfer of such Security Interest to itself and may settle and pass the
accounts of the person entitled to such Security Interest. Any accounts so
settled and passed are conclusive and binding on the Chargor.

 

19.2                    The
Chargor
shall reimburse the Bank for any Costs incurred by the Bank in exercise of its
rights under this Clause.

 

 

20.                              OPENING A NEW ACCOUNT

 

20.1                    If
the Bank receives notice of any subsequent Security Interest affecting the
Charged Property, the Bank may open a new account for the Chargor in its books.

 

20.2                    If
the Bank does not open such new account, then, unless the Bank gives express
written notice to the contrary to the Chargor, all payments by or on behalf of
the Chargor to the Bank will be treated as from the time of receipt of notice
of such subsequent Security Interest by the Bank as having been credited to a
new account of the Chargor and not as having been applied in reduction of the
amount of the Secured Liabilities as at the time when the notice was received.

 

 

21.                              SUSPENSE ACCOUNT

 

The Bank may, in its
reasonable discretion credit to any suspense or impersonal account and hold in
such account, on such terms as the Bank may in its discretion think fit, all
monies received, recovered or realised by the Bank pursuant to this Charge (including,
without limitation, the proceeds of any conversion of currency) pending the
application from time to time (as the Bank may effect in its discretion) of
such monies and accrued interest, if any, in or towards satisfaction of the
Secured Liabilities.

 

 

22.                              PAYMENTS AND WITHHOLDING TAXES

 

Subject to Clause 12 of the Loan Agreement, the Chargor shall pay and discharge the
Secured Liabilities without any set-off, counterclaim, restriction or
condition, without regard to any equities between the Chargor and the Bank and
free and clear of, and without deduction or withholding for, or on account of,
any taxes, except to 

 

17

 

the extent that the Chargor
is required by law to deduct or withhold any Taxes, in which case it shall pay
to the Bank such additional amount as may be necessary in order to ensure that
the net amount received by the Bank after the required deduction or withholding
(including, without limitation, any required deduction or withholding on such
additional amount) is equal to the amount that the Bank would have received had
no such deduction or withholding been made. Any additional amount paid under
this Clause shall be treated as agreed compensation and not as interest.

 

 

23.                              CURRENCY

 

23.1                    All
monies received or held by the Bank in respect of the Secured Liabilities may,
from time to time after demand has been made, be converted into such other
currency as the Bank in its reasonable discretion considers necessary or
desirable to cover the obligations and liabilities actual or contingent of the
Chargor in that other currency at the exchange rate for purchasing that other
currency with the existing currency.

 

23.2                    If
and to the extent that the Chargor fails to pay the amount due on demand the Bank
may in its absolute discretion without notice to the Chargor purchase at any
time thereafter so much of any currency as the Bank considers necessary or
desirable to cover the obligations and liabilities of the Chargor in such
currency at the Bank’s exchange rate for purchasing such currency with another
relevant currency and the Chargor hereby agrees to indemnify the Bank against
the full cost incurred by the Bank for such purchase.

 

23.3                    The
Bank shall not be liable to the Chargor for any loss resulting from any
fluctuation in exchange rates before or after the exercise of the foregoing
powers.

 

23.4                    No
payment to the Bank (whether under any judgment or court order or otherwise)
shall discharge the obligation or liability of the Chargor in respect of which
it was made unless and until the Bank shall have received payment in full in
the currency in which such obligation or liability was incurred and to the
extent that the amount of any such payment shall, on actual conversion into
such currency, fall short of such obligation or liability actual or contingent
expressed in that currency the Bank shall have a further separate cause of
action against the Chargor, shall be entitled to enforce the security
constituted by this Charge to recover the amount of the shortfall and such
amount will bear interest
at the Default Rate in
accordance with Clause 3 (Interest) from the date of payment by the Bank until
the date of reimbursement.

 

18

 

24.                              SET-OFF

 

The Chargor agrees the Bank
may at any time without notice or further demand notwithstanding any settlement
of account or other matter whatsoever, combine or consolidate all or any of its
then existing accounts wherever situate including any accounts in the name of
the Bank or of the Chargor jointly with others (whether current, deposit, loan
or of any other nature whatsoever whether subject to notice or not and whether
in sterling or in any other currency) and set-off or transfer any sum standing
to the credit of any one or more such accounts in or towards satisfaction of
the Secured Liabilities. Where such combination, set-off or transfer requires
the conversion of one currency into another, such conversion shall be
calculated at the Bank’s exchange rate for purchasing the currency for which
the Chargor is liable, with the existing currency.

 

 

25.                              ASSIGNMENT

 

This Charge shall bind and
inure to the benefit of the respective successors and permitted assigns of each
of the parties and shall bind all persons who become bound as a chargor to this
Charge; provided, however, that neither this Charge nor any rights hereunder
may be assigned by the Chargor without Bank’s prior written consent, which
consent may be granted or withheld in Bank’s sole discretion.  Bank shall have the right without the consent
of or notice to the Chargor to sell, transfer, negotiate, or grant
participation in all or any part of, or any interest in, Bank’s obligations,
rights and benefits hereunder to a person to whom it is permitted to do so
under the terms of Clause 12 of the Loan Agreement.

 

 

26.                              WAIVERS

 

No failure or delay or other
relaxation or indulgence on the part of the Bank to exercise any power, right
or remedy shall operate as a waiver thereof nor shall any single or partial
exercise or waiver of any power, right or remedy preclude its further exercise
or the exercise of any other power, right or remedy.

 

19

 

27.                              SEVERABILITY

 

Each of the provisions of
this Charge is distinct and severable from the others and if at any time one or
more of such provisions is or becomes illegal, invalid or unenforceable the
validity, legality and enforceability of the remaining provisions hereof shall
not in any way be affected or impaired thereby.

 

 

28.                              NOTICES

 

28.1                    Each
party may give any notice, demand or other communication under or in connection
with this Charge in the manner set forth and subject
to the terms
of Section 10 of the Loan Agreement
at the address identified with its name below.

 

 

29.                              COUNTERPARTS AND DELIVERY

 

29.1                    This
Charge may be executed in any number of counterparts, each of which is an
original, and which together constitute one and the same document.

 

29.2                    If
this Charge is executed in more than one counterpart, this Charge is deemed to
be delivered and has effect when:

 

29.2.1               each
party
other than the Bank has executed a counterpart of this Charge;

 

29.2.2               each party other than the Bank has handed
over such counterpart to one of the other parties to this Charge; and

 

29.2.3               each of the
counterparts has been dated.

 

29.3                    If
this Charge is not executed in more than one counterpart, this Charge is deemed
to be delivered and has effect when each party other than the Bank has executed
this Charge and this Charge has been dated.

 

29.4                    The
execution (whether under hand or as a deed) or sealing of this Charge by or on
behalf of a party constitutes an authority to the solicitors or legal counsel
acting for that party in connection with this Charge, or any agent or employee
of such solicitors or legal counsel, to deliver it as a deed on behalf of that
party.

 

29.5                    Each
party to this Charge agrees to be bound by this Charge despite the fact that
any other person which was intended to execute or to be bound does not do so or
is not effectually bound and despite the fact that any Security Interest
contained in this Charge is terminated or becomes invalid or unenforceable
against any other person whether or not such termination, invalidity or
unenforceability is known to the Bank.

 

20

 

30.                              LAW AND JURISDICTION

 

This Charge shall be governed by and construed in
accordance with English Law.

 

IN WITNESS WHEREOF this Charge has been executed and delivered as a deed on
the date written at the beginning of this Charge.

 

21

 

THE SCHEDULE

The
Shares

 

 

The
entire issued share capital of the Borrower comprising:

 

1.                                       1,488,205 Ordinary Shares of 5
pence each.

 

2.                                       1,475,104 Deferred Ordinary Shares
of 5 pence each.

 

3.                                       180,703 New Ordinary Shares of 5
pence each.

 

 

22

 

EXECUTED and
DELIVERED as a DEED

for and on behalf of

EVOLVING SYSTEMS  HOLDINGS LIMITED
by:

 

 

	
   

  	
  Director

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Secretary

  	
   

  

 

 

Notice  Details:

 

 

	
  Address:

  	
   

  	
  c/o Evolving Systems

  
	
   

  	
   

  	
  9777 Pyramid Court

  
	
   

  	
   

  	
  Suite 100

  
	
   

  	
   

  	
  Englewood

  
	
   

  	
   

  	
  Colorado

  
	
   

  	
   

  	
  80112 USA

  
	
   

  	
   

  	
   

  
	
  Fax No:

  	
   

  	
  001 303 802 1138

  
	
  Attention:

  	
   

  	
  Anita T. Moseley

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  With a copy to:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Fax No:

  	
   

  	
  001 303 802 1420

  
	
  Attention:

  	
   

  	
  Brian R. Ervine

  

 

 

23

 

EXECUTED and
DELIVERED as a DEED

for and on behalf of

BRIDGE
BANK, N.A. by:

 

 

	
   

  	
  Authorised
  Officer

  

 

 

 

 

 

 

 

 

 

Notice  Details:

 

	
  Address:

  	
   

  	
  55 Almaden Boulevard

  
	
   

  	
   

  	
  San Jose

  
	
   

  	
   

  	
  CA 95113

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Fax No:

  	
   

  	
  001 408 423 8520

  
	
  Attention:

  	
   

  	
  Dan Pistone

  

 

 

1

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