Document:

ex1020form8k031915.htm

AGREEMENT AND PLAN OF MERGER

between

TETRIDYN SOLUTIONS, INC.

and

OCEAN THERMAL ENERGY CORPORATION

March 12, 2015

  

  

  

TABLE OF CONTENTS

	
ARTICLE I—THE MERGER

	
2

	
Section 1.01

	
The Merger.

	
2

	
Section 1.02

	
Restrictions on New TetriDyn Stock.

	
2

	
Section 1.03

	
Closing; Closing Date; Effective Time.

	
3

	
Section 1.04

	
Effect of the Merger.

	
3

	
Section 1.05

	
Change of TetriDyn Name and Recapitalization

	
3

	  	  	  
	
ARTICLE II—CONVERSION OF SECURITIES; EXCHANGE OF CERTIFICATES

	
3

	
Section 2.01

	
Merger Consideration; Conversion and Cancellation of Securities.

	
3

	
Section 2.02

	
Exchange and Surrender of Certificates.

	
4

	  	  	  
	
ARTICLE III—REPRESENTATIONS, COVENANTS, AND WARRANTIES OF OTE

	
6

	
Section 3.01

	
Organization and Qualifications.

	
6

	
Section 3.02

	
Charter Documents.

	
6

	
Section 3.03

	
Capitalization.

	
6

	
Section 3.04

	
Authority.

	
7

	
Section 3.05

	
No Conflict: Required Filings and Consents.

	
7

	
Section 3.06

	
Permits; Compliance.

	
8

	
Section 3.07

	
Financial Statements.

	
8

	
Section 3.08

	
Absence of Certain Changes or Events.

	
8

	
Section 3.09

	
Absence of Litigation.

	
9

	
Section 3.10

	
Tax Matters.

	
9

	
Section 3.11

	
Taxes

	
9

	
Section 3.12

	
Vote Required.

	
10

	
Section 3.13

	
Brokers.

	
10

	
Section 3.14

	
Information Supplied.

	
10

	
Section 3.15

	
Employee Benefit Plans; Labor Matters.

	
10

	
Section 3.16

	
Employee Relations

	
11

	
Section 3.17

	
Certain Business Practices.

	
11

	
Section 3.18

	
Environmental Matters.

	
12

	
Section 3.19

	
Insurance.

	
12

	
Section 3.20

	
Certain Contracts and Restrictions.

	
12

	
Section 3.21

	
Properties.

	
12

	
Section 3.22

	
Easements.

	
12

	
Section 3.23

	
Futures Trading and Fixed Price Exposure.

	
12

	
Section 3.24

	
Intellectual Property.

	
13

	
Section 3.25

	
Transactions with Affiliates.

	
13

	
Section 3.26

	
Compliance with Securities Laws.

	
14

	
Section 3.27

	
Disclosure Controls

	
14

	
Section 3.28

	
Off Balance Sheet Arrangements

	
14

	
Section 3.29

	
Forward-Looking Statement

	
14

	
Section 3.30

	
No Improper Practices

	
14

	
Section 3.31

	
OFAC

	
14

	
Section 3.32

	
Minute Book.

	
15

	  	  	  
	
ARTICLE IV—REPRESENTATIONS, COVENANTS, AND WARRANTIES OF TETRIDYN

	
15

	
Section 4.01

	
Organization and Qualifications.

	
15

	
Section 4.02

	
Articles and Bylaws.

	
15

	
Section 4.03

	
Capitalization.

	
15

	
Section 4.04

	
Authority.

	
16

	
Section 4.05

	
No Conflict: Required Filings and Consents.

	
17

 

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Section 4.06

	
Permits; Compliance.

	
17

	
Section 4.07

	
Reports; Financial Statements.

	
17

	
Section 4.08

	
Absence of Certain Changes or Events.

	
18

	
Section 4.09

	
Absence of Litigation.

	
18

	
Section 4.10

	
Tax Matters.

	
19

	
Section 4.11

	
Taxes.

	
19

	
Section 4.12

	
No Vote Required.

	
20

	
Section 4.13

	
Brokers.

	
20

	
Section 4.14

	
Information Supplied.

	
20

	
Section 4.15

	
Employee Benefit Plans; Labor Matters.

	
20

	
Section 4.16

	
Employee Relations

	
21

	
Section 4.17

	
Certain Business Practices.

	
21

	
Section 4.18

	
Environmental Matters.

	
21

	
Section 4.19

	
Insurance.

	
21

	
Section 4.20

	
Certain Contracts and Restrictions.

	
22

	
Section 4.21

	
Properties.

	
22

	
Section 4.22

	
Easements.

	
22

	
Section 4.23

	
Futures Trading and Fixed Price Exposure.

	
22

	
Section 4.24

	
Intellectual Property.

	
22

	
Section 4.25

	
Transactions with Affiliates.

	
23

	
Section 4.26

	
Compliance with Securities Laws.

	
23

	
Section 4.27

	
Disclosure Controls.

	
23

	
Section 4.28

	
Off Balance Sheet Arrangements.

	
24

	
Section 4.29

	
Forward-Looking Statement.

	
24

	
Section 4.30

	
No Improper Practices

	
24

	
Section 4.31

	
OFAC

	
24

	
Section 4.32

	
Minute Book

	
24

	 	 	 
	
ARTICLE V—ADDITIONAL AGREEMENTS

	
24

	
Section 5.01

	
California Corporations Code Section 25142 “Fairness” Permit

	
24

	
Section 5.02

	
Approvals of Stockholders

	
25

	
Section 5.03

	
Access and Information.

	
25

	
Section 5.04

	
Other State Securities Laws.

	
26

	
Section 5.05

	
Appropriate Action; Consents; Filings.

	
26

	
Section 5.06

	
Acquisition of New TetriDyn Stock.

	
27

	
Section 5.07

	
Limitations on Resale of New TetriDyn Stock Following Possible Public Offering.

	
29

	
Section 5.08

	
No Representation or Opinions Regarding Certain Legal Matters

	
29

	
Section 5.09

	
Public Announcements

	
29

	
Section 5.10

	
Board of Directors and Officers.

	
30

	
Section 5.11

	
[Reserved]

	
30

	
Section 5.12

	
Post-Closing Matters

	
30

	 	 	 
	
ARTICLE VI—CLOSING CONDITIONS

	
31

	
Section 6.01

	
Third-Party Conditions to Obligations of the Parties under this Agreement.

	
31

	
Section 6.02

	
Additional Conditions to Obligations of the Parties.

	
31

	
Section 6.03

	
TetriDyn Recapitalization

	
32

	 	 	 
	
ARTICLE VII—TERMINATION, AMENDMENT AND WAIVER

	
32

	
Section 7.01

	
Termination

	
32

	
Section 7.02

	
Effect of Termination.

	
33

	
Section 7.03

	
Amendment

	
33

	
Section 7.04

	
Waiver

	
33

	
Section 7.05

	
Fees, Expenses and Other Payments

	
33

 

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ARTICLE VIII—GENERAL PROVISIONS

	
33

	
Section 8.01

	
Effectiveness of Representations, Warranties and Agreements; Survival.

	
33

	
Section 8.02

	
Notices.

	
34

	
Section 8.03

	
Certain Definitions.

	
34

	
Section 8.04

	
Interpretation.

	
35

	
Section 8.05

	
Entire Agreement.

	
36

	
Section 8.06

	
Assignment.

	
36

	
Section 8.07

	
Parties in Interest.

	
36

	
Section 8.08

	
Failure or Indulgence Not Waiver; Remedies Cumulative.

	
36

	
Section 8.09

	
Governing Law.

	
36

	
Section 8.10

	
Counterparts.

	
37

	 	 	 
	 	 	 
	 	 	 
	EXHIBITS	 	 
	 	 	 
	Exhibit A	Form of Certificate of Merger	 
	Exhibit B 	Management of TetriDyn and the Surviving Corporation	 

 

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AGREEMENT AND PLAN OF MERGER

THIS AGREEMENT AND PLAN OF MERGER (“Agreement”), dated as of March 12, 2015, is entered into by and between TETRIDYN SOLUTIONS, INC., a Nevada corporation (“TetriDyn”), and OCEAN THERMAL ENERGY CORPORATION, a Delaware corporation (“OTE”).  TetriDyn and OTE are sometimes hereinafter together referred to as the “Parties.”

RECITALS

A.           OTE is developing deep-water hydrothermal technologies to provide renewable energy and drinkable water.  OTE’s Sea Water Air Conditioning (“SWAC”) technology takes advantage of the difference between cold deep water and warmer surface water to produce hydrothermal energy without requiring fossil fuels.  OTE has recently broken ground on a SWAC project at the upscale Baha Mar Resort in the Bahamas.  This project, believed to be the first large-scale seawater air conditioning system in the Bahamas, is scheduled to be completed and in service by January 2016.  OTE is intrigued with the commercial potential of proprietary technologies being developed by TetriDyn as a potential for future business diversification.  Further, OTE recognizes that TetriDyn’s status as a company subject to the periodic reporting requirements pursuant to Section 15(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), may enhance access to the capital markets to fund future projects.

B.           Despite the efforts of TetriDyn’s directors and others to sustain its business after the unexpected death on April 26, 2013, of David Hempstead, its co-founder and chief executive officer, TetriDyn has been unable to launch full-scale commercialization of its most promising products and services.  Notwithstanding the disruption of TetriDyn’s business activities, it continues to believe that its business information technology, which combines systems engineering methodologies, strategic planning, and system integration, remains valuable and innovative.  Specifically, TetriDyn believes that its revenue recovery services, optimized business processes, and maintenance technology are likely to have applications in terms of increasing efficiency in other industries beyond the realm of healthcare, including service industries.  TetriDyn believes that it would benefit from obtaining the entrepreneurial skills of OTE’s management, which may enhance the possibility of commercialization of TetriDyn’s intellectual properties, and the business diversification that OTE’s business provides.

C.           The Parties desire to combine as set forth in this Agreement in order to achieve the business goals of each.

D.           In order to effect the combination of the Parties, TetriDyn shall organize a new, wholly owned subsidiary (“MergerCo”) under the laws of the state of Delaware that, upon the terms and subject to the conditions of this Agreement and in accordance with the laws governing corporations under the Delaware General Corporation Law (“Delaware Law”), shall merge with and into OTE (the “Merger”) for the purpose of making OTE a wholly owned subsidiary of TetriDyn (the “Surviving Corporation”).  In order to effect the Merger, at the Closing TetriDyn shall effect recapitalization that consists of a 4.6972-to-one reverse split of its  24,031,863 shares of issued and outstanding common stock (“Post-Split Stock”) and the increase of its authorized common stock to 200,000,000 shares, par value $0.0001 (collectively, the “Recapitalization”).  Pursuant to the terms of the Merger, the shares of common stock (the “OTE Stock”) issued and outstanding or existing immediately prior to the Effective Time (as defined herein) of the Merger will be converted at the Effective Time into the right to receive newly issued shares of Post-Split Stock (“New TetriDyn Stock”), subject to certain restrictions on transfer as hereinafter provided and subject to the rights of the holders of certain of such shares of OTE Stock to exercise their rights as dissenters to seek an appraisal of the fair value thereof as provided under Delaware Law (each, a “Dissenting OTE Stockholder”).  The number of shares of New TetriDyn Stock issued to the stockholders OTE, including shares that would have been issuable to Dissenting OTE Stockholders (as defined) had they not dissented, together with the number of shares issuable on the exercise of outstanding warrants, the conversion of outstanding bonds, and the payment of stock purchase subscriptions for the purchase of OTE Stock, shall constitute, on a fully diluted basis, 95% of the number of shares of common stock of TetriDyn to be outstanding after giving effect only to the Merger.  The shares of common stock of TetriDyn, par value $0.001 per share (“TetriDyn Stock”), issued and outstanding immediately prior to the Effective Time will remain issued and outstanding.  The shares of preferred stock of TetriDyn, par value $0.001 per share (“TetriDyn Preferred Stock”), issued and outstanding immediately prior to the execution of this Agreement are being surrendered to TetriDyn for cancellation at the date hereof pursuant to a separate agreement.

 

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E.           The board of directors of each of the Parties has determined that the Merger is consistent with and in furtherance of the long-term business strategies of each of them and is fair to, and in the best interests of, each of them and each of their respective stockholders; has approved and adopted this Agreement, the issuance of New TetriDyn Stock, and the other transactions contemplated hereby; and has recommended approval of this Agreement and the contemplated transactions by the appropriate Party’s stockholders when such approval is required by law.

F.           For federal income tax purposes, it is understood that the Merger has been structured to qualify as a so-called “tax-free reorganization” under the provisions of Sections 368(a)1(A) and 368(a)(2)(E) of the United States Internal Revenue Code of 1986, as amended (the “Code”), and that each Party will take all actions reasonably necessary to so qualify the Merger, although neither Party has obtained or will be required to obtain or provide an opinion of counsel to the foregoing effect.

G.           Prior to obtaining required regulatory approvals satisfying or waiving other conditions precedent, and consummating the Merger, it is in the best interests of OTE that TetriDyn initiate an updated technical and commercialization review of its intellectual properties with a view to possible broadened market introduction, address the potential resolution or restructuring of legacy obligations, and move towards bringing its SEC reports current and, in general, advancing its business activities.  Inasmuch as OTE and TetriDyn cannot complete the Merger as contemplated by this Agreement until certain conditions are satisfied and required regulatory approvals obtained, OTE and TetriDyn desire that an affiliate of one of OTE’s principal shareholders, JPF Venture Group, Inc. (“JPF”), invest in TetriDyn prior to the consummation of the Merger in order to provide TetriDyn with management and financial resources that can be applied to the foregoing goals, all as more particularly set forth in the certain Investment Agreement of even date (the “Investment Agreement”), by and between TetriDyn, JPF and Antoinette Knapp Hempstead, an individual, on behalf of herself and the estate of her late husband, David W. Hempstead.

H.           Certain terms used in this Agreement are defined in section 8.03 hereof.

AGREEMENT

NOW, THEREFORE, in consideration of the foregoing, the respective representations, warranties, covenants, and agreements set forth in this Agreement, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged and confirmed, the Parties agree as follows:

ARTICLE I

THE MERGER

Section 1.01                      The Merger

Upon the terms and subject to the conditions set forth in this Agreement, and in accordance with Delaware Law, at the Effective Time, MergerCo shall be merged with and into OTE, the separate corporate existence of MergerCo shall cease, OTE shall continue as the Surviving Corporation of the Merger, and the OTE Stock issued and outstanding or existing immediately prior to the Effective Time of the Merger shall be converted at the Effective Time into the right to receive shares of New TetriDyn Stock as herein provided.

Section 1.02                      Restrictions on New TetriDyn Stock

Transfer of the shares of New TetriDyn Stock issuable in the Merger in accordance with this Agreement will be subject to certain restrictions: (a) under the Securities Act of 1933, as amended (the “Securities Act”), and Regulation D promulgated by the U.S. Securities and Exchange Commission (the “SEC”) thereunder, as more particularly set forth in section 5.06; (b) under certain applicable state securities laws; and (c) for a period immediately following the Merger and completion of a possible public offering of TetriDyn Stock as more particularly set forth in section 5.07.

 

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Section 1.03                      Closing; Closing Date; Effective Time

Unless this Agreement shall have been terminated pursuant to section 7.01, the consummation of the Merger and the closing of the transactions contemplated by this Agreement (the “Closing”) shall take place by the exchange of documents electronically, by facsimile, or by overnight courier by a recognized national courier service as soon as practicable (but in any event within two business days) after the satisfaction or, if permissible, waiver of the conditions set forth in Article VI, or at such other date, time, and place as TetriDyn and OTE may agree.  The date on which the Closing takes place is referred to herein as the “Closing Date.”  As promptly as practicable following the Closing Date, the Parties shall cause the Merger to be consummated by filing the Certificate of Merger, in the form of Exhibit A attached hereto, with the Delaware Secretary of State (the date and time of the filing, or such later date or time agreed upon by TetriDyn and OTE and set forth therein, being the “Effective Time”).

Section 1.04                      Effect of the Merger

At the Effective Time, to the full extent provided under Delaware Law, OTE, as the Surviving Corporation of the Merger with MergerCo, shall possess all the rights, privileges, powers, and franchises of a public as well as of a private nature, and be subject to all the restrictions, disabilities, and duties of each of the merged entities.  All rights, privileges, powers, and franchises of each of the merged entities, and all property (real, personal, and mixed) and all debts due to either of the merged entities on whatever account, as well as stock subscriptions and all other things in action belonging to each of the merged entities, shall be vested in OTE, as the Surviving Corporation.  All property, rights, privileges, powers, and franchises, and all and every other interest shall be thereafter as effectively the property of the Surviving Corporation as they were of the respective corporation, and the title to any real estate vested by deed or otherwise, in either constituent entity, shall not revert or be in any way impaired; but all rights of creditors and all liens upon any property of either constituent entity shall be preserved unimpaired, and all debts, liabilities, and duties of the constituent entities shall thenceforth attach to the Surviving Corporation and may be enforced against it to the same extent as if said debts, liabilities, and duties had been incurred or contracted by it.

Section 1.05                      Change of TetriDyn Name and Recapitalization

In connection with the consummation of the Merger and upon the consent of the holders of a majority of the outstanding common of TetriDyn as provided in this Agreement, immediately following the Closing, TetriDyn shall file with the Nevada Secretary of State an amendment to its articles of incorporation changing its name to “Ocean Thermal Energy Corporation” or such other name as may be available and acceptable to the Parties and effecting the Recapitalization.

ARTICLE II

CONVERSION OF SECURITIES; EXCHANGE OF CERTIFICATES

Section 2.01                      Merger Consideration; Conversion and Cancellation of Securities

At the Effective Time, by virtue of the Merger and without any action on the part of TetriDyn, OTE, or MergerCo or their respective stockholders:

(a)           Subject to the other provisions of this Article II, each share of OTE Stock issued and outstanding immediately prior to the Effective Time (excluding any OTE Stock described in section 2.01(c) of this Agreement and shares held by Dissenting OTE Stockholders) shall be converted into the right to receive one (1) (the “Exchange Ratio”) share of New TetriDyn Stock.  Notwithstanding the foregoing, if between the date of this Agreement and the Effective Time the outstanding shares of TetriDyn Stock or OTE Stock shall have been changed into a different number of shares or a different class, by reason of any stock dividend, subdivision, reclassification, conversion, recapitalization, split, combination, exchange of shares, or sale of additional shares, the Exchange Ratio shall be correspondingly adjusted to reflect such stock dividend, subdivision, reclassification, conversion, recapitalization, split, combination, exchange, or sale of shares.

 

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(b)           Subject to the other provisions of this Article II, persons having subscribed to purchase shares of OTE Stock, as identified in Schedules 3.03(b)(i)-(v), if any, upon the payment of the consideration of the purchase price for their shares of OTE Stock as set forth in their subscription agreement, shall be issued New TetriDyn Stock in accordance with such subscription agreements, appropriately adjusted to give effect to the Exchange Ratio or adjusted Exchange Ratio, as applicable.

(c)           Subject to the other provisions of this Article II, the former holders of warrants to purchase OTE Stock, as identified in Schedule 3.03(c) of the OTE Schedules, at the Effective Time, shall be granted warrants to purchase the number of shares of New TetriDyn Stock at the exercise prices and during the warrant terms set forth opposite their respective names on Schedule 3.03(c), appropriately adjusted to give effect to the Exchange Ratio or adjusted Exchange Ratio, as applicable.  Such new warrants containing substantially identical terms as the existing warrants shall be delivered to the holders of existing warrants as quickly as practicable after the Effective Time against delivery to TetriDyn of the existing warrants for cancellation.  Pending the issuance of the new warrants, the existing warrants outstanding at the Effective Time shall thereafter represent the right to purchase that whole number of shares of New TetriDyn Stock at an exercise price determined in accordance with the provisions of section 2.01(a) hereof.

(d)           Notwithstanding any provision of this Agreement to the contrary, each share of OTE Stock held in the treasury of OTE and each share of OTE Stock owned by OTE or any direct or indirect wholly owned subsidiary of OTE immediately prior to the Effective Time shall be canceled and extinguished without any conversion thereof, and no payment shall be made with respect thereto.

(e)           Subject to the provisions of this Article II, each certificate evidencing OTE Stock at the Effective Time (other than OTE Stock described in section 2.01(b) of this Agreement or shares held by a Dissenting OTE Stockholder) (the “Converted Shares” or “Converted Share Certificates”) shall thereafter represent the right to receive, subject to section 2.02(f) of this Agreement, that whole number of shares of New TetriDyn Stock determined pursuant to section 2.01(a) hereof.  The holders of Converted Share Certificates shall cease to have any rights respecting such Converted Shares except as otherwise provided herein or by law.  Converted Share Certificates shall be exchanged for certificates evidencing whole shares of New TetriDyn Stock upon the surrender of such Converted Share Certificates in accordance with the provisions of section 2.02 of this Agreement, without interest.  No fractional shares of New TetriDyn Stock shall be issued in connection with the Merger and, in lieu thereof, the number of shares issuable to any registered stockholder of record of OTE shall be rounded upward to the nearest whole share.

(f)           Notwithstanding anything in this Agreement to the contrary, any issued and outstanding shares of OTE Stock held by a Dissenting OTE Stockholder who has not voted in favor of nor consented to the Merger and who complies with all the provisions of Delaware Law concerning the right of holders of such stock to dissent from the Merger and require appraisal of his shares, shall not be converted as described in this section 2.01 but shall become, at the Effective Time, by virtue of the Merger and without any further action, the right to receive such consideration as may be determined to be due to such Dissenting OTE Stockholder in accordance with Delaware Law; provided, however, that shares of OTE Stock outstanding immediately prior to the Effective Time and held by a Dissenting OTE Stockholder, who shall, after the Effective Time, withdraw his demand for appraisal or lose his right of appraisal, in either case pursuant to Delaware Law, shall be deemed to be converted as of the Effective Time into the right to receive New TetriDyn Stock.

Section 2.02                      Exchange and Surrender of Certificates

(a)           As of the Effective Time, TetriDyn shall deposit, or shall cause to be deposited with Interwest Transfer Company, Inc., 1981 Murray Holiday Road, Suite 100, P.O. Box 17136, Salt Lake City, UT 84117 (the “Exchange Agent”), for the benefit of the holders of shares of OTE Stock for exchange in accordance with this Article II, the certificates representing shares of New TetriDyn Stock issuable in the Merger.

 

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(b)           As soon as reasonably practicable after the Effective Time, the Exchange Agent shall mail to each holder of record of shares of OTE Stock a letter of transmittal (which shall specify that delivery shall be effected, and risk of loss and title to the Converted Share Certificates shall pass, only upon delivery of the Converted Share Certificates to the Exchange Agent, and which shall be in such form and have such other provisions as TetriDyn may reasonably specify) and instructions for use in effecting the surrender of the Converted Share Certificates in exchange for certificates representing shares of New TetriDyn Stock issuable pursuant to section 2.01.  Upon surrender of a Converted Share Certificate to the Exchange Agent, together with the duly executed letter of transmittal, the holder of a Converted Share Certificate shall be entitled to receive in exchange therefor a certificate representing that number of whole shares of New TetriDyn Stock that such holder has the right to receive pursuant to the provisions of this Article II.  In the event of a transfer of ownership of OTE Stock that is not registered in OTE’s transfer records, a certificate representing the proper number of shares of New TetriDyn Stock may be issued to a transferee if the Converted Share Certificate representing such OTE Stock is presented to the Exchange Agent, accompanied by all documents required to evidence and effect such transfer and by evidence that any applicable stock transfer taxes have been paid.  Until surrendered as contemplated by this section 2.02, each Converted Share Certificate shall be deemed at any time after the Effective Time to represent only the New TetriDyn Stock into which the Converted Shares represented by such Converted Share Certificate would be converted as provided in this Article II.

(c)           After the Effective Time, there shall be no further registration of transfers of OTE Stock.  If, after the Effective Time, certificates representing shares of OTE Stock are presented to TetriDyn or the Exchange Agent, they shall be exchanged for the New TetriDyn Stock provided for in this Agreement in accordance with the procedures set forth herein.

(d)           Any portion of the New TetriDyn Stock made available to the Exchange Agent pursuant to this section 2.02 that remains unclaimed by the holders of shares of OTE Stock one year after the Effective Time shall be returned to TetriDyn, upon demand, and any holder who has not exchanged his Converted Shares of OTE Stock in accordance with this section 2.02 prior to that time shall thereafter look only to TetriDyn for exchange of the New TetriDyn Stock for his shares of OTE Stock.  Notwithstanding the foregoing, TetriDyn shall not be liable to any owner of OTE Stock for any amount paid to a public official pursuant to applicable abandoned property, escheat, or similar Laws (as defined herein).

(e)           No dividends, interest, or other distributions respecting shares of New TetriDyn Stock shall be paid to the holder of any unsurrendered Converted Share Certificates unless and until such Converted Share Certificates are surrendered as provided in this section 2.02.  Upon surrender, TetriDyn shall pay or cause the Exchange Agent to pay, without interest, all dividends and other distributions payable for such shares of New TetriDyn Stock on a date, and for a record date, after the Effective Time.

(f)           No certificates evidencing fractional shares of New TetriDyn Stock shall be issued upon the surrender for exchange of Converted Share Certificates.  In lieu of any fractional interests, TetriDyn shall issue to each holder of record of a Converted Share Certificate, upon surrender of such certificate for exchange pursuant to this Article II, a whole share of New TetriDyn Stock.

(g)           TetriDyn shall be entitled to deduct and withhold from the consideration otherwise payable pursuant to this Agreement to any former holder of OTE Stock all amounts TetriDyn (or any affiliate thereof) is required to deduct and withhold respecting the making of such payment under the Code or any provision of state, local, or foreign tax law.  To the extent that amounts are so withheld by TetriDyn, such withheld amounts shall be treated for all purposes of this Agreement as having been paid to the former holder of the OTE Stock for which such deduction and withholding was made.  In the event the amount withheld is insufficient to satisfy the withholding obligations of TetriDyn, (or any affiliate thereof), such former stockholder shall reimburse TetriDyn (or such affiliate), at its request, the amount of any such insufficiency.

 

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ARTICLE III

REPRESENTATIONS, COVENANTS, AND WARRANTIES OF OTE

OTE hereby represents, covenants, and warrants to TetriDyn, such representations, covenants, and warranties to be made as of the date hereof and at and as of the Closing Date, to survive the Closing, and to continue in accordance with the terms hereof (except as otherwise expressly set forth in section 8.01), as set forth in this Article III and as limited, qualified by, or except as otherwise set forth in the written disclosure schedules to this Agreement supplementally provided by OTE to TetriDyn (the “OTE Schedules”).

Section 3.01                      Organization and Qualifications

OTE and each of its subsidiaries: (a) is a corporation or limited liability company duly organized, validly existing, and in good standing under the Laws of its state of organization; (b) has all requisite power and authority to own, lease, and operate its properties and assets and to carry on its business as it is now being conducted; and (c) is duly qualified and in good standing to do business in each jurisdiction in which the nature of the business conducted by it or the ownership or leasing of its properties makes such qualification necessary, other than where the failure to be so duly qualified and in good standing would not have an OTE Material Adverse Effect.  The term “OTE Material Adverse Effect,” as used in this Agreement, shall mean any change or effect that, individually or when taken together with all such other changes or effects, would be reasonably likely to be materially adverse to the assets, liabilities, financial condition, results of operations, or current or future business of OTE.  Schedule 3.01 of the OTE Schedules contains a list of each OTE subsidiary and its jurisdiction of organization and existence.  When used herein, the term OTE includes each of its subsidiaries set forth on Schedule 3.01.  Except as set forth on Schedule 3.01, OTE does not own an equity interest in any other corporation, partnership, joint venture arrangement, or other business entity that is material to the assets, liabilities, financial condition, results of operations, or current or future business of OTE.  Except as set forth in Schedule 3.01, OTE does not have any predecessor, as that term is defined under generally accepted accounting principles.

Section 3.02                      Charter Documents

Included in Schedule 3.02 of the OTE Schedules are complete and correct copies of OTE’s certificate of incorporation and bylaws, as presently in effect.  OTE is not in violation of any of the provisions of its certificate of incorporation or its bylaws.

Section 3.03                      Capitalization

(a)           The authorized capital stock of OTE consists of 200,000,000 shares of common stock and 20,000,000 shares of preferred stock, par value $0.0001 per share, of which 78,745,287 shares of common stock are issued and outstanding, 18,324,360 shares of common stock are reserved for issuance on the exercise of outstanding warrants, 139,000 shares of common stock are reserved for issuance on the conversion of outstanding bonds, for a total of 97,208,647 shares of common stock issued and outstanding and reserved for issuance on a fully diluted basis.  No other shares of capital stock are reserved for issuance on the exercise of any other call, commitment, right, or other contractual arrangements to which OTE is a party or by which it is bound.  Except as described in this section 3.03 or Schedule 3.03(a) of the OTE Schedules, no shares of capital stock of OTE are reserved for any purpose.  Each of the outstanding shares of capital stock of OTE is duly authorized, validly issued, and fully paid and nonassessable and has not been issued in violation of (nor are any of the authorized shares of capital stock of OTE subject to) any preemptive or similar rights created by statute, the certificate of incorporation or bylaws of OTE, or any agreement to which OTE is a party or bound, and such outstanding shares owned by OTE are owned free and clear of all security interests, liens, claims, pledges, agreements, limitations on OTE’s voting rights, charges, or other encumbrances of any nature whatsoever.

 

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(b)

(i)           Except as set forth in Schedule 3.03(b)(i) of the OTE Schedules, there are no options, warrants, or other rights (including registration rights), agreements, arrangements, or commitments of any character to which OTE is a party relating to the issued or unissued capital stock of OTE or obligating OTE to grant, issue, or sell any shares of the capital stock of OTE.

(ii)           Except as set forth in Schedule 3.03(b)(ii) of the OTE Schedules, there are no obligations, contingent or otherwise, of OTE to: (1) repurchase, redeem, or otherwise acquire any shares of OTE Stock or other capital stock of OTE; or (2) provide material funds to, make any material investment in (in the form of a loan, capital contribution, or otherwise), or provide any guarantee respecting the obligations of any other person.

(iii)           Except for its subsidiaries listed in Schedule 3.01 and as described in Schedule 3.03(b)(iii) of the OTE Schedules, OTE: (1) does not directly or indirectly own; (2) has not agreed to purchase or otherwise acquire; or (3) does not hold any interest convertible into or exchangeable or exercisable for 5% or more of the capital stock of any corporation, partnership, joint venture, or other business association or entity.

(iv)           Except as set forth in Schedule 3.03(b)(iv) of the OTE Schedules, there are no agreements, arrangements, or commitments of any character (contingent or otherwise) pursuant to which any person is or may be entitled to receive any payment based on the revenues or earnings, or calculated in accordance therewith, of OTE.

(v)           Except as set forth in Schedule 3.03(b)(v) of the OTE Schedules, there are no voting trusts, proxies, or other agreements or understandings to which OTE is a party or by which OTE is bound respecting the voting of any shares of capital stock of OTE.

(c)           OTE has made available to TetriDyn complete and correct copies (if any) of: (i) each stock option, stock award, or other benefit plan (collectively, the “OTE Option Plans”) and the forms of options issued pursuant to any OTE Option Plan, including all amendments thereto; and (ii) all options and warrants that are not in the form specified under clause (i) above.  Schedule 3.03(c) of the OTE Schedules sets forth a complete and correct list of all outstanding warrants and options, restricted stock, or any other stock awards (the “OTE Stock Awards”) granted under the OTE Option Plans or otherwise, setting forth as of the date hereof: (x) the number and type of OTE Stock Awards; (xi) the exercise price of each outstanding stock option or warrant; and (xii) the number of stock options and warrants presently exercisable.

Section 3.04                      Authority

OTE has all requisite corporate power and authority to execute and deliver this Agreement, to perform its obligations hereunder, and to consummate the transactions contemplated hereby (subject to, respecting the Merger, the adoption of this Agreement by the stockholders of OTE as described in section 3.12 hereof).  The execution and delivery of this Agreement by OTE and the consummation by OTE of the transactions contemplated hereby have been duly authorized by all necessary corporate action, and no other corporate proceedings on the part of OTE are necessary to authorize this Agreement or to consummate the transactions contemplated hereby (subject to, respecting the Merger, the approval thereof by the stockholders of OTE as described in section 3.12).  This Agreement has been duly executed and delivered by OTE and, assuming the due authorization, execution, and delivery thereof by TetriDyn, constitutes the legal, valid, and binding obligation of OTE, enforceable against OTE in accordance with its terms, except that: (a) such enforcement may be subject to applicable bankruptcy, insolvency, or other similar Laws, now or hereafter in effect affecting creditors’ rights generally; and (b) the remedy of specific performance and injunctive and other forms of equitable relief may be subject to equitable defenses and to the discretion of the court before which any proceeding therefor may be brought.

 

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Section 3.05                      No Conflict: Required Filings and Consents

(a)           Except as set forth in Schedule 3.05 of the OTE Schedules, the execution and delivery of this Agreement by OTE does not, and the consummation of the transaction contemplated hereby will not: (i) conflict with or violate OTE’s certificate of incorporation or bylaws, in each case as amended or restated; (ii) conflict with or violate any federal, state, foreign, or local law, statute, ordinance, rule, regulation, order, judgment, or decree (collectively, “Laws”) applicable to OTE or by which any of its properties is bound or subject; or (iii) result in any breach of or constitute a default (or an event that with notice or lapse of time or both would become a default) under, or give to others any rights of termination, amendment, acceleration, or cancellation of, or result in the creation of a lien or encumbrance on any of the properties or assets of OTE pursuant to, any note, bond, mortgage, indenture, contract, agreement, lease, license, permit, franchise, or other instrument or obligation to which OTE is a party or by which OTE or any of its properties is bound or subject; except for any such conflicts or violations described in clause (ii) or breaches, defaults, events, rights of termination, amendment, acceleration or cancellation, payment obligations, or liens or encumbrances described in clause (iii) that would not have an OTE Material Adverse Effect.

(b)           The execution and delivery of this Agreement by OTE does not, and consummation of the transactions contemplated hereby will not, require OTE to obtain any consent, license, permit, approval, waiver, authorization or order of, or to make any filing with or notification to, any governmental or regulatory authority, domestic or foreign (collectively, “Governmental Entities”), except for filing appropriate merger documents as required by applicable state Laws and when the failure to obtain such consents, licenses, permits, approvals, waivers, authorizations or orders, or to make such filings or notifications, would not, either individually or in the aggregate, materially interfere with OTE’s performance of its obligations under this Agreement and would not have an OTE Material Adverse Effect.

Section 3.06                      Permits; Compliance

Each of OTE and each subsidiary, to OTE’s knowledge, any third-party operator of any of OTE’s or any subsidiary’s properties, is in possession of all material franchises, grants, authorizations, licenses, permits, easements, variances, exemptions, consents, certificates, approvals, and orders necessary to own, lease, and operate its properties and to carry on its business in all material respects as it is now being conducted or as presently foreseeable (collectively, the “OTE Permits”), and there is no action, proceeding, or investigation pending or, to OTE’s knowledge, threatened regarding suspension or cancellation of any of the OTE Permits, except when the failure to possess, or the suspension or cancellation of, such OTE Permits would not have an OTE Material Adverse Effect.  Except as set forth in Schedule 3.06 of the OTE Schedules, OTE has not received from any Governmental Entity any written notification respecting possible conflicts, defaults, or violations of Laws, except for written notices relating to possible conflicts, defaults, or violations that would not have an OTE Material Adverse Effect.

Section 3.07                      Financial Statements

Included in Schedule 3.07 of the OTE Schedules is OTE’s unaudited consolidated balance sheets as of September 30, 2014 (“OTE’s Current Balance Sheet”), and the related consolidated statements of operations, changes in stockholders’ equity (deficiency), and cash flows for the nine months ended September 30, 2014, including the notes thereto.  Such schedule also includes OTE’s audited consolidated balance sheets as of December 31, 2013 and 2012, and the related consolidated statements of operations, changes in stockholders’ equity (deficiency), and cash flows for the years ended December 31, 2013 and 2012, including the notes thereto and the report thereon of Liggett, Vogt & Webb, P.A. Certified Public Accountants.  OTE’s Current Balance Sheet and the related consolidated statements of operations, changes in stockholders’ equity (deficiency), and cash flows for the nine months ended September 30, 2014, together with the notes thereto, contain all adjustments (all of which are normal recurring adjustments) necessary to present fairly OTE’s results of operations and financial position for the periods and as of the dates indicated.  All such audited and unaudited financial statements have been prepared in accordance with generally accepted accounting principles applied on a consistent basis throughout the periods involved (except: (a) to the extent required by changes in generally accepted accounting principles; and (b) as may be indicated in the notes thereto) and fairly present OTE’s financial position as of the respective dates thereof and the result of operations and cash flows for the periods indicated, except that any unaudited interim financial statements were or will be subject to normal and recurring year-end adjustments.

 

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Section 3.08                      Absence of Certain Changes or Events

Except as contemplated by this Agreement or as set forth in Schedule 3.08 of the OTE Schedules, since the date of OTE’s Current Balance Sheet, OTE has conducted its business in the ordinary course of business consistent with past practice.  Since the date of OTE’s Current Balance Sheet, there has not been: (a) any event, change, or effect (including the occurrence of any liabilities of any nature, whether or not accrued, contingent, or otherwise) having or, which would be reasonably likely to have, individually or in the aggregate, an OTE Material Adverse Effect; (b) any declaration, setting aside, or payment of any dividend or other distribution (whether in cash, stock, or property) respecting the equity interests of OTE or any redemption, purchase, or other acquisition by OTE of any of OTE’s capital stock; (c) any revaluation by OTE of its assets, including the writing down of the value of inventory or the writing down or off of notes or accounts receivable, other than in the ordinary course of business and consistent with past practices; (d) any change by OTE in accounting principles or methods, except insofar as may be required by a change in generally accepted accounting principles; (e) a fundamental change in the nature of OTE’s business; (f) any arrangement for the disposition of any material property or assets of OTE; (g) any accrual or arrangement for or payment of bonuses or special compensation of any kind or any severance or termination pay to any present or former officer, employee, or shareholder; (h) any increase in any profit sharing, bonus, deferred compensation, insurance, pension, retirement, or other employee benefit plan, payment, or arrangement made to, for, or with its officers, directors, or employees; or (i) an OTE Material Adverse Effect.

Section 3.09                      Absence of Litigation

Except as set forth in Schedule 3.09 of the OTE Schedules, there is no claim, suit, litigation, proceeding, arbitration, or, to OTE’s knowledge, investigation of any kind, at law or in equity (including actions or proceedings seeking injunctive relief), pending or threatened against OTE or any of its properties (except for claims, actions, suits, litigation, proceedings, arbitrations, or investigations that would not have an OTE Material Adverse Effect), and OTE is not subject to any continuing order of, consent decree, settlement agreement, or other similar written agreement with, or to OTE’s knowledge, continuing investigation by, any Governmental Entity, or any judgment, order, writ, injunction, decree or award of any Government Entity or arbitrator, including cease-and-desist or other orders, except for matters that would not have an OTE Material Adverse Effect.

Section 3.10                      Tax Matters

Neither OTE nor, to OTE’s knowledge, any of its affiliates has taken or agreed to take any action that would prevent the Merger from constituting a tax-free reorganization qualifying under the provisions of Section 368(a) of the Code, all as more particularly set forth in a separate letter of representation in form and substance reasonably acceptable to TetriDyn to be delivered by OTE to TetriDyn at the Closing and which is incorporated herein by reference.

Section 3.11                      Taxes

(a)           Except as disclosed on Schedule 3.11(a) of the OTE Schedules, OTE has made available to TetriDyn complete copies of: (i) all returns and information statements respecting any Taxes of OTE (“OTE Returns”) for all periods since the formation of OTE open under the statute of limitations for assessments; and (ii) examination reports and statements of deficiencies assessed by OTE.  OTE does not do business or derive income from any state, local, territorial, or foreign taxing jurisdiction so as to be subject to Taxes or return filing requirements other than those OTE Returns described in the preceding sentence.  Except as disclosed on Schedule 3.11(a) or to the extent that the applicable statute of limitations has expired, all OTE Returns required to be filed by or on behalf of OTE have been duly filed on a timely basis with the appropriate governmental authorities and are true, correct, and complete, and all Taxes for all periods covered by such OTE Returns, or respecting any period prior to the Effective Time, have been duly paid in full or a provision for the payment thereof has been made in accordance with generally accepted accounting principles and is reflected on OTE’s Current Balance Sheet.  All OTE Returns are accurate and correct in all material respects.  OTE has no liabilities respecting the payment of any Taxes (including any deficiencies, interest, or penalties) accrued for or applicable to the period ended on the date of OTE’s Current Balance Sheet, except as reflected therein, and all such dates and years and periods prior thereto and for which OTE may at said date have been liable in its own right or as transferee of the assets of, or as successor to, any other corporation or other entity, except for taxes accrued but not yet due and payable.  OTE has not elected at any time pursuant to the Code to be treated as an S corporation pursuant to Section 1362(a) of the Code or a collapsed corporation pursuant to Section 341(f) of the Code, nor has OTE made any other elections pursuant to the Code (other than elections that relate solely to methods of accounting, depreciation, or amortization) that would have an OTE Material Adverse Effect.  There are no outstanding agreements or waivers extending the statutory period of limitation applicable to any OTE Return.

 

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(b)           OTE has complied in all respects with all applicable Laws relating to the payment and withholding of Taxes (including any estimated Taxes and the withholding of Taxes pursuant to Sections 1441 and 1442 of the Code or similar provisions under any foreign Laws) and has, within the time and the manner prescribed by law, withheld from employee wages and paid over all amounts withheld under applicable Laws, except when noncompliance would not have an OTE Material Adverse Effect.  There are no liens on any of OTE’s assets respecting Taxes other than for Taxes not yet due and payable.  There is no material dispute or claim concerning any liabilities for Taxes of OTE either raised or reasonably expected to be raised by any taxing authority.

(c)           Except as disclosed in Schedule 3.11(c) of the OTE Schedules: (i) there is no audit of any OTE Returns by a governmental or taxing authority in process, pending, or threatened (formally or informally), and OTE has no knowledge of any potential audit; (ii) except to the extent that the applicable statute of limitations has expired and except as to matters that have been resolved, no deficiencies exist or have been asserted (either formally or informally) or are expected to be asserted respecting Taxes of OTE, and no notice (either formally or informally) has been received by OTE that it has not filed an OTE Return or paid Taxes required to be filed or paid by it; (iii  OTE is not a party to any pending action or proceeding for assessment or collection of Taxes, nor has an action or proceeding been asserted or threatened (either formally or informally) against it or any of its assets, except to the extent that the applicable statute of limitations has expired and except as to matters that have been resolved; (iv) no waiver or extension of any statute of limitations is in effect respecting Taxes of OTE or OTE Returns; (v) no action has been taken that would have the effect of deferring any liability for Taxes for OTE from any period prior to the Effective Time to any period after the Effective Time; (vi) there are no requests for rulings, subpoenas, or requests for information pending respecting the Taxes of OTE; (vii) no power of attorney has been granted by OTE respecting any matter relating to Taxes; (viii) OTE has never been included in an affiliated group of corporations, within the meaning of Section 1504 of the Code; (ix) OTE is not (nor has it ever been) a party to any tax-sharing agreement between affiliated corporations; and (x) the amount of liability for unpaid Taxes of OTE for all periods ending on or before the Effective Time will not, in the aggregate, materially exceed the amount of the liability accruals for Taxes reflected on OTE’s Current Balance Sheet.

Section 3.12                      Vote Required

The only vote of the holders of any class or series of OTE capital stock necessary to approve the Merger is the affirmative vote of the holders of a majority of the OTE Stock outstanding.

Section 3.13                      Brokers

Except as set forth in Schedule 3.13 of the OTE Schedules, no broker, finder, or investment banker is entitled to any brokerage, finder’s, or other fee or commission in connection with the transactions contemplated by this Agreement based upon arrangements made by or on behalf of OTE.  Prior to the date of this Agreement, OTE has made available to TetriDyn complete and correct copies of all agreements referenced in Schedule 3.13 pursuant to which any such firm will be entitled to any payment related to the transactions contemplated by this Agreement.

Section 3.14                      Information Supplied

Without limiting any of the representations and warranties contained herein, no representation or warranty of OTE and no statement by OTE or other information contained in or documents referred to in the OTE Schedules, as of the date of such representation, warranty, statement, or document, contains or contained any untrue statement of material fact or, at the date thereof, omits or omitted to state a material fact necessary in order to make the statements contained therein, in light of the circumstances under which such statements are or were made, not misleading.

 

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Section 3.15                      Employee Benefit Plans; Labor Matters

(a)           OTE is not bound by or subject to (and none of its operations is bound by or subject to) any written or oral, express or implied, contract, commitment, or arrangement with any labor union, and no labor union has requested or, to OTE’s knowledge, has sought to represent any of OTE’s employees, representatives, or agents.  There is no strike or other labor dispute involving OTE pending or, to OTE’s knowledge, threatened that could have an OTE Material Adverse Effect, nor is OTE aware of any labor organization activity involving its employees.  OTE is not aware that any officer or key employee, or that any group of key employees, intends to terminate employment with OTE, nor does OTE have a present intention to terminate the employment of any of the foregoing.  The employment of each officer and employee of OTE, to the best of OTE’s knowledge, is terminable at OTE’s will.

(b)           Except as set forth in Schedule 3.15(b) of the OTE Schedules, OTE does not maintain, and has not contributed during the past five years to, any employee benefit plan (as such term is defined in The Employee Retirement Income Security Act of 1974 (“ERISA”), Section 3(s), or for which OTE or any member of its ERISA group would incur liability under Sections 4065, 4069, 4212(c), or 4204 of ERISA, and any other retirement, pension, stock option, stock application rights, profit sharing, incentive compensation, deferred compensation, savings, thrift, vacation pay, severance pay, or other employee compensation or benefit plan, agreement, practice, or arrangement, whether written or unwritten, whether or not legally binding (collectively, the “OTE Benefit Plans”).  As of the date of this Agreement, except as would not have an OTE Material Adverse Effect, the material OTE Benefit Plans maintained by OTE or any member of its ERISA Group, or respecting which OTE has or may have a liability, are in substantial compliance with applicable Laws, including ERISA and the Code.  Schedule 3.15(b) sets forth a list of all OTE Benefit Plans, true and complete copies of which have been furnished to TetriDyn.  With respect to the OTE Benefit Plans, no event has occurred, and to OTE’s knowledge, there exists no condition or set of circumstances, in connection with which OTE or any member of its ERISA group could be subject to any liability under the terms of the OTE Benefit Plans, ERISA, the Code, or any other applicable Law that would have an OTE Material Adverse Effect.

(c)           Except as otherwise set forth on Schedule 3.15(c) of the OTE Schedules, neither OTE nor any member of its ERISA group contributes or has an obligation to contribute to, has not within five years prior to the date of this Agreement contributed or had an obligation to contribute to, or has any secondary liability under ERISA Section 4204 to, a multiemployer plan within the meaning of Section 3(37) of ERISA.

(d)           Neither OTE nor any member of its ERISA group is or has ever been a party to any collective bargaining or other labor union contracts.  No collective bargaining agreement is being negotiated by OTE.  There is no pending or threatened labor dispute, strike, or work stoppage against OTE or any of its subsidiaries that may interfere with OTE’s business activities.  None of OTE or any of its representatives or employees has committed any unfair labor practices in connection with the operation of OTE’s business, and there is no pending or threatened charge or complaint against OTE by the National Labor Relations Board or any comparable state agency.

(e)           With respect to each OTE Benefit Plan that is a “group health plan” within the meaning of Section 5000(b) of the Code, each such OTE Benefit Plan complies, and has complied, with the requirements of Part 6 of Title I of ERISA and Sections 4980B and 5000 of the Code, except when the failure to so comply would not have an OTE Material Adverse Effect.

Section 3.16                      Employee Relations

OTE has complied in all material respects with all applicable Laws that relate to prices, wages, hours, harassment, disabled access, discrimination employment, and collective bargaining and to the operation of its business, and OTE is not liable for any arrears of wages or taxes or penalties for failure to comply with any of the foregoing.  OTE believes that its relations with its employees are satisfactory.

 

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Section 3.17                      Certain Business Practices

Neither OTE nor any of its directors, officers, agents, or employees on OTE’s behalf has used any funds for unlawful contributions, gifts, entertainment, or other unlawful expenses relating to political activity; made any unlawful payment to foreign or domestic government officials or employees or to foreign or domestic political parties or campaigns; violated any provision of the Foreign Corrupt Practices Act of 1977, as amended; or made any other unlawful payment.

Section 3.18                      Environmental Matters

Except as set forth in Schedule 3.18 of the OTE Schedules: (a) during the period of OTE’s ownership, use, or other occupancy of the properties of OTE, OTE has not used, generated, manufactured, stored, treated, disposed of, or released any hazardous waste or substance on, under, or about any of the properties, except in compliance with environmental Laws; and (b) OTE has no knowledge of, or reason to believe that there has been: (i) any use, generation, manufacture, storage, treatment, disposal, release, or threatened release of any hazardous waste or substance by any prior owners or occupants of any of the properties, except in compliance with environmental Laws; or (ii) any actual or threatened litigation or claims of any kind against OTE or any other person for whose conduct it is or may be liable by any person relating to such matters.

Section 3.19                      Insurance

OTE is currently insured, and during each of the past three calendar years has been insured, for reasonable amounts against such risks as companies similarly situated would, in accordance with good business practice, customarily be insured.

Section 3.20                      Certain Contracts and Restrictions

Other than agreements, contracts, or commitments listed elsewhere in the OTE Schedules, Schedule 3.20 of the OTE Schedules lists, as of the date hereof, each agreement, contract, or commitment (including any amendments thereto) to which OTE is a party or by which OTE is bound involving consideration during the next 12 months in excess of $1,000,000 or that is otherwise material to the assets, liabilities, financial condition, results of operations, or current or future business of OTE, taken as a whole.  As of the date of this Agreement and except as indicated on the OTE Schedules, OTE has fully complied with all material terms and conditions of all agreements, contracts, and commitments that will be listed in the OTE Schedules, and all such agreements, contracts, and commitments are in full force and effect.  All such agreements, contracts, and commitments are not subject to any memorandum or other written document or understanding permitting cancellation, and OTE has no knowledge of any defaults thereunder or any cancellations or modifications thereof.

Section 3.21                      Properties

Except for liens arising in the ordinary course of business after the date hereof and properties and assets disposed of in the ordinary course of business after the date of OTE’s Current Balance Sheet, OTE has good and marketable title free and clear of all liens, the existence of which would have an OTE Material Adverse Effect, to all material properties and assets, whether tangible or intangible, real, personal, or mixed, reflected in OTE’s Current Balance Sheet as being owned by OTE as of the date thereof or purported to be owned on the date hereof.  All buildings, fixtures, equipment, and other property and assets that are material to its business held under leases by OTE are held under valid instruments enforceable by OTE in accordance with their respective terms.  Substantially all of OTE’s equipment in regular use has been well maintained and is in good and serviceable condition, reasonable wear and tear excepted.

Section 3.22                      Easements

OTE’s business has been operated in a manner that does not violate the material terms of any easements, rights of way, permits, servitude, licenses, and similar rights relating to real property used by OTE in its business (collectively, “OTE Easements”) except for violations that have not resulted and will not result in an OTE Material Adverse Effect.  All material OTE Easements are valid and enforceable and grant the rights purported to be granted thereby and all rights necessary thereunder for the current operation of such business.

 

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Section 3.23                      Futures Trading and Fixed Price Exposure

OTE is not presently engaged in any futures or options trading nor is it a party to any price, interest rate, or currency swaps, hedges, futures, or other derivative instruments.

Section 3.24                      Intellectual Property

(a)           Schedule 3.24(a) of the OTE Schedules lists all the registered patents, trademarks, service marks, copyrights, trade names, and applications for any of the foregoing owned by OTE as of the date of this Agreement (the “OTE Registered Intellectual Property”).  OTE has good and marketable title to the OTE Registered Intellectual Property and has good and marketable title to, or valid licenses or rights to use, all patents, copyrights, trademarks, trade names, brand names, proprietary and other technical information, technology and software (collectively, “OTE Intellectual Property”) used in the operation of its business as presently conducted, free from any liens and free from any requirement of any past, present, or future royalty payments, license fees, charges, or other payments or conditions or restrictions, whatsoever, except as set forth on Schedule 3.24(a).  Immediately after the Effective Time, the Surviving Corporation will own or will have the right to use all OTE Intellectual Property free from liens and on the same terms and conditions as in effect prior to the Effective Time.

(b)           To the best of its knowledge, OTE has not infringed and is not infringing upon, and for the past three years has not engaged and is not engaging in, any unauthorized use or misappropriation of any patents, copyrights, trademarks, trade names, brand names, proprietary and other technical information, technology and software owned by or belonging to any other person.  Except as set forth in Schedule 3.24(b) of the OTE Schedules, there are no claims or proceedings pending or, to OTE’s knowledge, threatened against OTE asserting that OTE is infringing or engaging in the unauthorized use or misappropriation of any intellectual property of any other person.

(c)           OTE is not aware of prior art respecting any of the patents owned or licensed by it that was not disclosed to the U.S. Patent and Trademark Office (or to any comparable foreign authority, if necessary) in connection with applications for such patents.  OTE is not aware of any fact or event making any one or more claims of any of such patents invalid or unenforceable, and OTE has not engaged in any conduct, or omitted to perform any necessary act, the result of which would be to invalidate any of such patents or adversely affect any of their enforceability.

(d)           Schedule 3.24(d) of the OTE Schedules sets forth all agreements and arrangements pursuant to which: (i) OTE has licensed OTE Intellectual Property to, or the use of OTE Intellectual Property in other areas permitted (through nonassertion, settlement, or similar agreements or otherwise) by, any other person; and (ii) OTE has had OTE Intellectual Property licensed to it, or has otherwise been permitted to use OTE Intellectual Property (through nonassertion, settlement, or similar agreements or otherwise).  All of the agreements or arrangements to the extent set forth on Schedule 3.24(d): (x) are in full force and effect in accordance with their terms and OTE is not aware that any default exists thereunder by OTE or by any other party thereto; (xi) are free and clear of liens; (xii) do not contain any change of control or other terms or conditions that will become applicable or inapplicable as a result of the consummation of the Merger and the transactions contemplated by this Agreement.  OTE has delivered to TetriDyn true and complete copies of all agreements and arrangements set forth on Schedule 3.24(d).  There are no royalties, license fees, charges, or other amounts payable by, or on behalf of, OTE for any OTE Intellectual Property other than as set forth on Schedule 3.24(d).

 

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Section 3.25                      Transactions with Affiliates

Schedule 3.25 of the OTE Schedules sets forth a description of every material contract, agreement, or arrangement between OTE and any person who is or has ever been an officer or director of OTE, or person of record or known by OTE to have beneficial ownership of 10% or more of the issued and outstanding OTE Stock, and which is to be performed, in whole or in part, after the date hereof or was entered into within three years before the date hereof.  In all of such circumstances, the contract, agreement, or arrangement was for a bona fide business purpose of OTE, and the amount paid or received, whether in cash, services, or kind, is, has been during the full term thereof, and is required to be during the unexpired portion of the term thereof, no less favorable to OTE than terms available from otherwise unrelated parties in arm’s-length transactions.  Except as disclosed in Schedule 3.25 or otherwise disclosed herein, no officer or director of OTE or 10% shareholder of OTE has, or has had during the preceding three years, any interest, directly or indirectly, in any material transaction with OTE.  Schedule 3.25 also includes a description of any commitment by OTE, whether written or oral, to lend any funds to, borrow any money from, or enter into any other material transaction with, any affiliated person.

Section 3.26                      Compliance with Securities Laws

All of the securities offered and sold by OTE or any predecessor within three years prior to the date of this Agreement were issued in transactions exempt from registration under the Securities Act and applicable state securities Laws.

Section 3.27                      Disclosure Controls

OTE maintains systems of internal accounting controls sufficient to provide reasonable assurance that: (a) transactions are executed in accordance with management’s general or specific authorizations; (b) transactions are recorded as necessary to permit preparation of financial statements in conformity with generally accepted accounting principles and to maintain asset accountability; (c) access to assets is permitted only in accordance with management’s general or specific authorization; and (d) the recorded accountability for assets is compared with the existing assets at reasonable intervals and appropriate action is taken respecting any differences.

Section 3.28                      Off Balance Sheet Arrangements

There are no transactions, arrangements, and other relationships between and/or among OTE or, to OTE’s knowledge, any of its affiliates and any unconsolidated entity, including any structural finance, special purpose, or limited purpose entity (each, an “Off Balance Sheet Transaction”) that would reasonably be expected to affect materially OTE’s liquidity or the availability of, or requirements for, its capital resources.

Section 3.29                      Forward-Looking Statement

No forward-looking statement (within the meaning of Section 27A of the Securities Act and Section 21E of the Exchange Act) (a “Forward Looking Statement”) contained in OTE Schedules has been made or reaffirmed without a reasonable basis or has been disclosed other than in good faith.

Section 3.30                      No Improper Practices

Except as set forth in Schedule 3.30 of the OTE Schedules: (a) neither OTE nor, to OTE’s knowledge, any director, officer, agent, employee, or other person associated with or acting on behalf of OTE has, in the past three years: made any unlawful contributions to any candidate for any political office (or failed fully to disclose any contribution in violation of law); made any contribution or other payment to any official of, or candidate for, any federal, state, municipal, or foreign office or other person charged with similar public or quasi-public duty in violation of any law or of the character required; (b) following the Closing, TetriDyn will not be required by the Exchange Act to disclose any contributions or payments in any periodic report (“Periodic Report”) required to be filed pursuant to Section 13 or 15(d) thereunder; (c) no relationship, direct or indirect, exists between or among OTE or, to OTE’s knowledge any affiliate, on the one hand, and the directors, officers, and stockholders of OTE, on the other hand, that TetriDyn is required, or will be required, by the Exchange Act to describe in any Periodic Report following the Closing; and (d) there are no material outstanding loans or advances or material guarantees of indebtedness by OTE to, or for the benefit of, any of its officers or directors or any of the members of the families of any of them that TetriDyn is required, or will be required, by the Exchange Act to describe in any Periodic Report following the Closing.

 

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Section 3.31                      OFAC

Neither OTE nor, to OTE’s knowledge, any director, officer, agent, employee, or other affiliate of OTE or any of its subsidiaries is currently subject to any U.S. sanctions administered by the Office of Foreign Assets Control of the U.S. Treasury Department (“OFAC”).

Section 3.32                      Minute Book

OTE’s minute book contains, and will contain at the Closing Date, a materially complete record of all meetings, consents, or other actions of its board of directors and shareholders for the period from inception through the date hereof and accurately reflects the substance of all transactions referred to in such minutes in all material respects.

ARTICLE IV

REPRESENTATIONS, COVENANTS, AND WARRANTIES OF TETRIDYN

TetriDyn hereby represents, covenants, and warrants to OTE, such representations, covenants, and warranties to be made as of the date hereof and at and as of the Closing Date and to survive the Closing and continue in accordance with the terms hereof (except as otherwise expressly set forth in section 8.01), as set forth in this Article IV and as limited or qualified by the related disclosure schedules (the “TetriDyn Schedules”) supplementally provided by TetriDyn to OTE.

Section 4.01                      Organization and Qualifications

Each of TetriDyn and its subsidiary is a corporation duly organized, validly existing, and in good standing under the Laws of its state of incorporation; has all requisite corporate power and authority to own, lease, and operate its properties and assets and to carry on its business as it is now being conducted; and is duly qualified and in good standing to do business in each jurisdiction in which the nature of the business conducted by it or the ownership or leasing of its properties makes such qualification necessary, other than where the failure to be so duly qualified and in good standing would not have a TetriDyn Material Adverse Effect.  The term “TetriDyn Material Adverse Effect” as used in this Agreement shall mean any change or effect that, individually or when taken together with all such other changes or effects, would be reasonably likely to be materially adverse to the assets, liabilities, financial condition, results of operations, or current or future business of TetriDyn.  When used herein, the term TetriDyn includes its subsidiary as set forth on Schedule 4.01 of the TetriDyn Schedules.  Except as set forth in Schedule 4.01, TetriDyn does not own an equity interest in any other corporation, partnership, joint venture arrangement, or other business entity that is material to the assets, liabilities, financial condition, results of operations, or current or future business of TetriDyn.  Except as set forth in its Periodic Reports, TetriDyn does not have any predecessor, as that term is defined under generally accepted accounting principles.

Section 4.02                      Articles and Bylaws

Included in Schedule 4.02 of the TetriDyn Schedules are complete and correct copies of TetriDyn’s articles of incorporation and bylaws, as presently in effect.  TetriDyn is not in violation of any of the provisions of its articles of incorporation or bylaws.

Section 4.03                      Capitalization

(a)           The authorized capital stock of TetriDyn consists of: (i) 5,000,000 shares of preferred stock, par value $0.001 per share, of which 1,200,000 shares have been designated as Series A Preferred Stock and are issued and outstanding but are to be surrendered for cancellation contemporaneously with the execution of this Agreement and the related designation withdrawn; and (ii) 100,000,000 shares of TetriDyn Common Stock, par value $0.001 per share, of which 24,031,863 shares are issued and outstanding, 29,372,278 are reserved for issuance pursuant to the Investment Agreement of even date, and none are reserved for future issuance on the exercise of outstanding options, warrants, the conversion of other securities, or the exercise of any other call, commitment, right, or other contractual arrangements to which TetriDyn is a party or by which it is bound, for a total of 53,404,140 shares issued and issuable on a fully diluted

 

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basis, excluding shares issuable on the conversion of outstanding promissory notes due David and Antoinette Hempstead that are being acquired by JPF in connection with the Investment Agreement.  Except as described in this section 4.03 or Schedule 4.03(a) of the TetriDyn Schedules, no shares of capital stock of TetriDyn are reserved for any purpose.  All of the outstanding shares of capital stock of TetriDyn are duly authorized, validly issued, and fully paid and nonassessable, and have not been issued in violation of (nor are any of the authorized shares of capital stock of TetriDyn subject to) any preemptive or similar rights created by statute, TetriDyn’s articles of incorporation or bylaws, or any agreement to which TetriDyn is a party or bound, and such outstanding shares owned by TetriDyn are owned free and clear of all security interests, liens, claims, pledges, agreements, limitations on TetriDyn’s voting rights, charges, or other encumbrances of any nature whatsoever.

(b)

(i)           Except as set forth in Schedule 4.03(b)(i) of the TetriDyn Schedules, there are no options, warrants, or other rights (including registration rights), agreements, arrangements, or commitments of any character to which TetriDyn is a party relating to the issued or unissued capital stock of TetriDyn or obligating TetriDyn to grant, issue, or sell any shares of the capital stock of TetriDyn.

(ii)           Except as set forth in Schedule 4.03(b)(ii), there are no obligations, contingent or otherwise, of TetriDyn to: (1) repurchase, redeem, or otherwise acquire any shares of TetriDyn Stock or other capital stock of TetriDyn; or (2) provide material funds to, make any material investment in (in the form of a loan, capital contribution, or otherwise), or provide any guarantee respecting the obligations of any other person.

(iii)           Except as described in Schedule 4.03(b)(iii), TetriDyn does not directly or indirectly own, has not agreed to purchase or otherwise acquire, or does not hold any interest convertible into, or exchangeable or exercisable for, 5% or more of the capital stock of any corporation, partnership, joint venture, or other business association or entity.

(iv)           Except as set forth in Schedule 4.03(b)(iv), there are no agreements, arrangements, or commitments of any character (contingent or otherwise) pursuant to which any person is or may be entitled to receive any payment based on TetriDyn’s revenues or earnings or calculated in accordance therewith.

(v)           Except as set forth in Schedule 4.03(b)(v), there are no voting trusts, proxies, or other agreements or understandings to which TetriDyn is a party or by which TetriDyn is bound respecting the voting of any shares of capital stock of TetriDyn.

(c)           TetriDyn has made available to OTE complete and correct copies of: (i) each stock option, stock award, or other benefit plans (collectively, the “TetriDyn Option Plans”) and the forms of options issued pursuant to any TetriDyn Option Plan, including all amendments thereto; and (ii) all options and warrants that are not in the form specified under clause (i) above.  Schedule 4.03(c) of the TetriDyn Schedules sets forth a complete and correct list of all outstanding warrants and options, restricted stock, or any other stock awards (the “TetriDyn Stock Awards”) granted under the TetriDyn Option Plans or otherwise, setting forth as of the date hereof: (x) the number and type of TetriDyn Stock Awards; (xi) the exercise price of each outstanding stock option or warrant; and (xii) the number of stock options and warrants presently exercisable.

(d)           The shares of New TetriDyn Stock to be issued pursuant to this Agreement have been duly authorized, and upon issuance in accordance with the terms of this Agreement will be, validly issued, fully paid and nonassessable, and not issued in violation of any preemptive or similar rights created by statute, TetriDyn’s articles of incorporation and bylaws, or any agreement to which TetriDyn is a party or bound.

 

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Section 4.04                      Authority

TetriDyn has all requisite corporate power and authority to execute and deliver this Agreement, to perform its obligations hereunder, and to consummate the transactions contemplated hereby.  The execution and delivery of this Agreement by TetriDyn and the consummation by TetriDyn of the transactions contemplated hereby have been duly authorized by all necessary corporate action and no other corporate proceedings on the part of TetriDyn are necessary to authorize this Agreement or to consummate the transactions contemplated hereby.  This Agreement has been duly executed and delivered by TetriDyn and, assuming the due authorization, execution and delivery thereof by OTE, constitutes the legal, valid, and binding obligation of TetriDyn, enforceable against TetriDyn in accordance with its terms, except that: (a) such enforcement may be subject to applicable bankruptcy, insolvency, or other similar Laws, now or hereafter in effect, affecting creditors’ rights generally; and (b) the remedy of specific performance and injunctive and other forms of equitable relief may be subject to equitable defenses and to the discretion of the court before which any proceeding therefor may be brought.

Section 4.05                      No Conflict; Required Filings and Consents

(a)           Except as set forth in Schedule 4.05(a) of the TetriDyn Schedules, the execution and delivery of this Agreement by TetriDyn does not, and the consummation of the transaction contemplated hereby will not: (i) conflict with or violate TetriDyn’s articles of incorporation or bylaws, in each case as amended or restated; (ii) conflict with or violate any Laws applicable to TetriDyn or by which any of its properties is bound or subject; or (iii) result in any breach of, constitute a default (or an event that with notice or lapse of time or both would become a default) under, give to others any rights of termination, amendment, acceleration, or cancellation of, or result in the creation of a lien or encumbrance on any of the properties or assets of TetriDyn pursuant to, any note, bond, mortgage, indenture, contract, agreement, lease, license, permit, franchise, or other instrument or obligation to which TetriDyn is a party or by which TetriDyn or any of its properties is bound or subject, except for any such conflicts or violations described in clause (ii) or breaches, defaults, events, rights of termination, amendment, acceleration or cancellation, payment obligations, or liens or encumbrances described in clause (iii) that would not have a TetriDyn Material Adverse Effect.

(b)           The execution and delivery of this Agreement by TetriDyn does not, and consummation of the transactions contemplated hereby will not, require TetriDyn to obtain any consent, license, permit, approval, waiver, authorization or order of, or to make any filing with or notification to, any Governmental Entities, except for: (i) complying with certain federal and state securities Laws as provided in Article V hereof; and (ii) filing appropriate merger documents as required by applicable state Laws and when the failure to obtain such consents, licenses, permits, approvals, waivers, authorizations, or orders, or to make such filings or notifications, would not, either individually or in the aggregate, materially interfere with TetriDyn’s performance of its obligations under this Agreement and would not have a TetriDyn Material Adverse Effect.

Section 4.06                      Permits; Compliance

TetriDyn and, to TetriDyn’s knowledge, each third-party operator of any of TetriDyn’s properties is in possession of all franchises, grants, authorizations, licenses, permits, easements, variances, exemptions, consents, certificates, approvals, and orders necessary to own, lease, and operate its properties and to carry on its business in all material respects as it is now being conducted or as presently foreseeable (collectively, the “TetriDyn Permits”), and there is no action, proceeding, or investigation pending or, to TetriDyn’s knowledge, threatened regarding suspension or cancellation of any of the TetriDyn Permits, except when the failure to possess or the suspension or cancellation of such TetriDyn Permits would not have a TetriDyn Material Adverse Effect.  Except as set forth in Schedule 4.06 of the TetriDyn Schedules, TetriDyn has not received from any Governmental Entity any written notification respecting possible conflicts, defaults, or violations of Laws, except for written notices relating to possible conflicts, defaults, or violations that would not have a TetriDyn Material Adverse Effect.

 

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Section 4.07                      Reports; Financial Statements

(a)           TetriDyn filed its quarterly report on Form 10-Q for the quarter ended June 30, 2012, on August 20, 2012.  During the three years preceding such filing, TetriDyn had filed all forms, reports, statements, and other documents required to be filed with the SEC, including all quarterly reports on Form 10-Q, all annual reports on Form 10-K, all current reports on Form 8-K, and all other reports, schedules, registration statements, or other documents (collectively referred to as the “TetriDyn SEC Reports”), except when the failure to file any such forms, reports, statements, or other documents would not have a TetriDyn Material Adverse Effect.  The TetriDyn SEC Reports were prepared in accordance with the requirements of applicable law (including the Securities Act and the Exchange Act, as the case may be, and the rules and regulations of the SEC thereunder applicable to such TetriDyn SEC Reports) and did not at the time they were filed contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary in order to make the statements therein, in the light of the circumstances under which they are made, not misleading.  A copy of the SEC docket showing the TetriDyn SEC Reports, linked to the actual filings, is available at http://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=0000827099&owner=exclude&count=40&hidefilings=0.  TetriDyn is subject to the periodic reporting requirements of Section 15(d) of the Exchange Act and has no class of equity securities registered under Section 12 of the Exchange Act.

(b)           Included in Schedule 4.07 of the TetriDyn Schedules are the unaudited balance sheet of TetriDyn as of December 31, 2014 (“TetriDyn’s Current Balance Sheet”), together with certain adjustments, on a pro forma basis, to reflect certain actions and agreements to be effected in accordance with this Agreement and separate agreements related to or affecting TetriDyn entered into and to be consummated contemporaneously herewith and of which the parties have knowledge.  Schedule 4.07 also includes the Annual Report on Form 10-K for the year ended December 31, 2011, which contains the audited consolidated balance sheets of TetriDyn as of December 31, 2011, and the related consolidated statements of operations, stockholders’ deficit, and cash flows for the years ended December 31, 2011 and 2010, including the notes thereto and the report of Webb & Company, P.A., certified public accountants, thereon.  TetriDyn’s Current Balance Sheet does not include note disclosures that are required under generally accepted accounting principles, but contains all adjustments (all of which are normal recurring adjustments) necessary to present fairly the results of operations and financial position of TetriDyn for the periods and as of the dates indicated.  Except for the absence of note disclosures respecting TetriDyn’s Current Balance Sheet, all such audited and unaudited financial statements have been prepared in accordance with generally accepted accounting principles applied on a consistent basis throughout the periods involved (except: (a) to the extent required by changes in generally accepted accounting principles; and (b) as may be indicated in the notes thereto) and fairly present the financial position of TetriDyn as of the respective dates thereof and the result of operations and cash flows for the periods indicated (including reasonable estimates of normal and recurring year-end adjustments), except that any unaudited interim financial statements were or will be subject to normal and recurring year-end adjustments.

Section 4.08                      Absence of Certain Changes or Events

Except as contemplated by this Agreement or as set forth in Schedule 4.08 of the TetriDyn Schedules, since the date of TetriDyn’s Current Balance Sheet, TetriDyn has conducted its business in the ordinary course of business consistent with past practice.  Since the date of TetriDyn’s Current Balance Sheet, there has not been: (a) any event, change, or effect (including the occurrence of any liabilities of any nature, whether or not accrued, contingent or otherwise) having or that would be reasonably likely to have, individually or in the aggregate, a TetriDyn Material Adverse Effect; (b) any declaration, setting aside, or payment of any dividend or other distribution (whether in cash, stock, or property) respecting the equity interests of TetriDyn or any redemption, purchase, or other acquisition by TetriDyn of any of TetriDyn’s capital stock; (c) any revaluation by TetriDyn of its assets, including the writing down of the value of inventory or the writing down or off of notes or accounts receivable, other than in the ordinary course of business and consistent with past practices; (d) any change by TetriDyn in accounting principles or methods, except insofar as may be required by a change in generally accepted accounting principles; (e) a fundamental change in the nature of TetriDyn’s business; (f) any arrangement for the disposition of any material property or assets of TetriDyn; (g) any accrual, arrangement for, or payment of bonuses or special compensation of any kind or any severance or termination pay to any present or former officer, employee, or shareholder; (h) any increase in any profit sharing, bonus, deferred compensation, insurance, pension, retirement, or other employee benefit plan, payment or arrangement made to, for, or with its officers, directors, or employees; or (i) a TetriDyn Material Adverse Effect.

 

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Section 4.09                      Absence of Litigation

Except as set forth in Schedule 4.09 of the TetriDyn Schedules, there is no claim, suit, litigation, proceeding, arbitration, or to TetriDyn’s knowledge, investigation of any kind, at law or in equity (including actions or proceedings seeking injunctive relief), pending or threatened against TetriDyn or any of its properties (except for claims, actions, suits, litigation, proceedings, arbitrations, or investigations that would not have a TetriDyn Material Adverse Effect), and TetriDyn is not subject to any continuing order of, consent decree, settlement agreement, or other similar written agreement with, or to TetriDyn’s knowledge, continuing investigation by, any Governmental Entity, or any judgment, order, writ, injunction, decree, or award of any Government Entity or arbitrator, including cease-and-desist or other orders, except for matters that would not have a TetriDyn Material Adverse Effect.

Section 4.10                      Tax Matters

Neither TetriDyn nor, to TetriDyn’s knowledge, any of its affiliates has taken or agreed to take any action that would prevent the Merger from constituting a tax-free reorganization qualifying under the provisions of Section 368(a) of the Code, all as more particularly set forth in a separate letter of representation in form and substance reasonably satisfactory to OTE to be delivered by TetriDyn to OTE at the Closing and which is incorporated herein by reference.

Section 4.11                      Taxes

(a)           Except as disclosed on Schedule 4.11(a) of the TetriDyn Schedules, TetriDyn has made available to OTE complete copies of: (i) all returns and information statements respecting any Taxes of TetriDyn (“TetriDyn Returns”) for all periods since the formation of TetriDyn open under the statute of limitations for assessments; and (ii) examination reports and statements of deficiencies assessed by TetriDyn.  TetriDyn does not do business or derive income from any state, local, territorial, or foreign taxing jurisdiction so as to be subject to Taxes or return filing requirements, other than those TetriDyn Returns described in the preceding sentence.  Except as disclosed on Schedule 4.11(a) or to the extent that the applicable statute of limitations has expired, all TetriDyn Returns required to be filed by or on behalf of TetriDyn have been duly filed on a timely basis with the appropriate governmental authorities and are true, correct, and complete, and all Taxes for all periods covered by such TetriDyn Returns or respecting any period prior to the Effective Time, have been duly paid in full or a provision for the payment thereof has been made in accordance with generally accepted accounting principles and is reflected on TetriDyn’s Current Balance Sheet.  All TetriDyn Returns are accurate and correct in all material respects.  TetriDyn has no liabilities respecting the payment of any Taxes (including any deficiencies, interest, or penalties) accrued for or applicable to the period ended on the date of TetriDyn’s Current Balance Sheet, except as reflected therein, and all such dates and years and periods prior thereto and for which TetriDyn may at said date have been liable in its own right or as transferee of the assets of, or as successor to, any other corporation or other entity, except for taxes accrued but not yet due and payable.  TetriDyn has not elected at any time pursuant to the Code to be treated as an S corporation pursuant to Section 1362(a) of the Code or a collapsed corporation pursuant to Section 341(f) of the Code, nor has TetriDyn made any other elections pursuant to the Code (other than elections that relate solely to methods of accounting, depreciation, or amortization) that would have a TetriDyn Material Adverse Effect.  There are no outstanding agreements or waivers extending the statutory period of limitation applicable to any TetriDyn Return.

(b)           TetriDyn has complied in all respects with all applicable Laws relating to the payment and withholding of Taxes (including any estimated Taxes and the withholding of Taxes pursuant to Sections 1441 and 1442 of the Code or similar provisions under any foreign Laws) and has, within the time and the manner prescribed by law, withheld from employee wages and paid over all amounts withheld under applicable Laws.  There are no liens on any of the assets of TetriDyn respecting Taxes other than for Taxes not yet due and payable.  There is no material dispute or claim concerning any liabilities for Taxes of TetriDyn either raised or reasonably expected to be raised by any taxing authority.

 

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(c)           Except as disclosed in Schedule 4.11(c) of the TetriDyn Schedules: (i) there is no audit of any TetriDyn Returns by a governmental or taxing authority in process, pending, or threatened (formally or informally), and TetriDyn has no knowledge of any such potential audit; (ii) except to the extent that the applicable statute of limitations has expired and except as to matters that have been resolved, no deficiencies exist or have been asserted (either formally or informally) or are expected to be asserted respecting Taxes of TetriDyn, and no notice (either formally or informally) has been received by TetriDyn that it has not filed a TetriDyn Return or paid Taxes required to be filed or paid by it; (iii) TetriDyn is not a party to any pending action or proceeding for assessment or collection of Taxes, nor has such an action or proceeding been asserted or threatened (either formally or informally) against it or any of its assets, except to the extent that the applicable statute of limitations has expired and except as to matters that have been resolved; (iv) no waiver or extension of any statute of limitations is in effect respecting Taxes of TetriDyn or TetriDyn Returns; (v) no action has been taken that would have the effect of deferring any liability for Taxes for TetriDyn from any period prior to the Effective Time to any period after the Effective Time; (vi) there are no requests for rulings, subpoenas, or requests for information pending respecting the Taxes of TetriDyn; (vii) no power of attorney has been granted by TetriDyn respecting any matter relating to Taxes; (viii) TetriDyn has never been included in an affiliated group of corporations within the meaning of Section 1504 of the Code; (ix) TetriDyn is not (nor has it ever been) a party to any tax-sharing agreement between affiliated corporations; and (x) the amount of liability for unpaid Taxes of TetriDyn for all periods ending on or before the Effective Time will not, in the aggregate, materially exceed the amount of the liability accruals for Taxes reflected on TetriDyn’s Current Balance Sheet.

Section 4.12                      No Vote Required

No vote of the holders of any class or series of TetriDyn capital stock is necessary to approve the Merger by MergerCo.

Section 4.13                      Brokers

Except as set forth in Schedule 4.13 of the TetriDyn Schedules, no broker, finder, or investment banker is entitled to any brokerage, finder’s, or other fee or commission in connection with the transactions contemplated by this Agreement based upon arrangements made by or on behalf of TetriDyn.  Prior to the date of this Agreement, TetriDyn has made available to OTE complete and correct copies of all agreements referenced in Schedule 4.13 pursuant to which any such firm will be entitled to any payment related to the transactions contemplated by this Agreement.

Section 4.14                      Information Supplied

Without limiting any of the representations and warranties contained herein, no representation or warranty of TetriDyn and no statement by TetriDyn or other information contained in or documents referred to in the TetriDyn Schedules, as of the date of such representation, warranty, statement, or document, contains or contained any untrue statement of material fact or, at the date thereof, omits or omitted to state a material fact necessary in order to make the statements contained therein, in light of the circumstances under which such statements are or were made, not misleading.

Section 4.15                      Employee Benefit Plans; Labor Matters

(a)           TetriDyn is not bound by or subject to (and none of its operations is bound by or subject to) any written or oral, express or implied, contract, commitment, or arrangement with any labor union, and no labor union has requested or, to TetriDyn’s knowledge, has sought to represent any of TetriDyn’s employees, representatives, or agents.  There is no strike or other labor dispute involving TetriDyn pending or, to TetriDyn’s knowledge, threatened that could have a TetriDyn Material Adverse Effect, nor is TetriDyn aware of any labor organization activity involving its employees.  TetriDyn is not aware that any officer or key employee, or that any group of key employees, intends to terminate their employment with TetriDyn, nor does TetriDyn have a present intention to terminate the employment of any of the foregoing.  The employment of each officer and employee of TetriDyn, to the best of TetriDyn’s knowledge, is terminable at TetriDyn’s will.

 

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(b)           Except as set forth in Schedule 4.15(b) of the TetriDyn Schedules, TetriDyn does not maintain and has not contributed during the past five years to any employee benefit plan (as such term is defined in ERISA Section 3(s) or respecting which TetriDyn or any member of its ERISA group would incur liability under Sections 4065, 4069, 4212(c), or 4204 of ERISA, and any other retirement, pension, stock option, stock application rights, profit sharing, incentive compensation, deferred compensation, savings, thrift, vacation pay, severance pay, or other employee compensation or benefit plan, agreement, practice or arrangement, whether written or unwritten, whether or not legally binding (collectively, the “TetriDyn Benefit Plans”).  As of the date of this Agreement, except as would not have a TetriDyn Material Adverse Effect, the material TetriDyn Benefit Plans maintained by TetriDyn or any member of its ERISA group, or respecting which TetriDyn has or may have a liability, are in substantial compliance with applicable Laws, including ERISA and the Code.  Schedule 4.15(b) sets forth a list of all TetriDyn Benefit Plans, true and complete copies of which have been furnished to OTE.  With respect to the TetriDyn Benefit Plans, no event has occurred, and to TetriDyn’s knowledge, there exists no condition or set of circumstances, in connection with which TetriDyn or any member of its ERISA group could be subject to any liability under the terms of such TetriDyn Benefit Plans, ERISA, the Code, or any other applicable Law that would have a TetriDyn Material Adverse Effect.

(c)           Except as otherwise set forth on Schedule 4.15(c) of the TetriDyn Schedules, neither TetriDyn nor any member of its ERISA group contributes or has an obligation to contribute to, and has not within five years prior to the date of this Agreement contributed or had an obligation to contribute to or has any secondary liability under ERISA Section 4204 to, a multiemployer plan within the meaning of Section 3(37) of ERISA.

(d)           Neither TetriDyn nor any member of its ERISA group is or has ever been a party to any collective bargaining or other labor union contracts.  No collective bargaining agreement is being negotiated by TetriDyn.  There is no pending or threatened labor dispute, strike, or work stoppage against TetriDyn or any of its subsidiaries that may interfere with TetriDyn’s business activities.  None of TetriDyn or any of its representatives or employees has committed any unfair labor practices in connection with the operation of TetriDyn’s business, and there is no pending or threatened charge or complaint against TetriDyn by the National Labor Relations Board or any comparable state agency.

(e)           With respect to each TetriDyn Benefit Plan that is a “group health plan” within the meaning of Section 5000(b) of the Code, each such TetriDyn Benefit Plan complies and has complied with the requirements of Part 6 of Title I of ERISA and Sections 4980B and 5000 of the Code, except when the failure to so comply would not have a TetriDyn Material Adverse Effect.

Section 4.16                      Employee Relations

TetriDyn has complied in all material respects with all applicable Laws that relate to prices, wages, hours, harassment, disabled access, discrimination employment, and collective bargaining and to the operation of its business and is not liable for any arrears of wages or any taxes or penalties for failure to comply with any of the foregoing.  TetriDyn believes that its relations with its employees are satisfactory.

Section 4.17                      Certain Business Practices

Neither TetriDyn nor any of its TetriDyn’s directors, officers, agents, or employees on its behalf has used any funds for unlawful contributions, gifts, entertainment, or other unlawful expenses relating to political activity; made any unlawful payment to foreign or domestic government officials or employees or to foreign or domestic political parties or campaigns; violated any provision of the Foreign Corrupt Practices Act of 1977, as amended; or made any other unlawful payment.

 

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Section 4.18                      Environmental Matters

Except as set forth in Schedule 4.18 of the TetriDyn Schedules: (a) during the period of TetriDyn’s ownership, use, or other occupancy of the properties of TetriDyn, it has not used, generated, manufactured, stored, treated, disposed of, or released any hazardous waste or substance on, under, or about any of the properties, except in compliance with environmental Laws; and (b) TetriDyn has no knowledge of, or reason to believe that there has been: (i) any use, generation, manufacture, storage, treatment, disposal, release, or threatened release of any hazardous waste or substance by any prior owners or occupants of any of the properties, except in compliance with environmental Laws; or (ii) any actual or threatened litigation or claims of any kind against TetriDyn or any other person for whose conduct it is or may be liable by any person relating to such matters.

Section 4.19                      Insurance

TetriDyn is not currently insured.

Section 4.20                      Certain Contracts and Restrictions

Other than agreements, contracts, or commitments listed elsewhere in the TetriDyn Schedules, Schedule 4.20 of the TetriDyn Schedules lists, as of the date hereof, each agreement, contract, or commitment (including any amendments thereto) to which TetriDyn is a party or by which TetriDyn is bound involving consideration during the next 12 months in excess of $10,000 or that is otherwise material to the assets, liabilities, financial condition, results of operations or current or future business of TetriDyn, taken as a whole.  As of the date of this Agreement and except as indicated on the TetriDyn Schedules, TetriDyn has fully complied with all material terms and conditions of all agreements, contracts, and commitments that will be listed in the TetriDyn Schedules, and all such agreements, contracts, and commitments are in full force and effect.  All such agreements, contracts, and commitments are not subject to any memorandum or other written document or understanding permitting cancellation, and TetriDyn has no knowledge of any defaults thereunder or any cancellations or modifications thereof.

Section 4.21                      Properties

Except for liens arising in the ordinary course of business after the date hereof and properties and assets disposed of in the ordinary course of business after the date of TetriDyn’s Current Balance Sheet, TetriDyn has good and marketable title free and clear of all liens, the existence of which would have a TetriDyn Material Adverse Effect, to all material properties and assets, whether tangible or intangible, real, personal, or mixed, reflected in TetriDyn’s Current Balance Sheet as being owned by TetriDyn as of the date thereof or purported to be owned on the date hereof.  All buildings, fixtures, equipment, and other property and assets that are material to its business held under leases by TetriDyn are held under valid instruments enforceable by TetriDyn in accordance with their respective terms.  Substantially all of TetriDyn’s equipment in regular use has been well maintained and is in good and serviceable condition, reasonable wear and tear excepted.

Section 4.22                      Easements

TetriDyn’s business has been operated in a manner that does not violate the material terms of any easements, rights of way, permits, servitude, licenses, and similar rights relating to real property used by TetriDyn in its business (collectively, “TetriDyn Easements”) except for violations that have not resulted and will not result in a TetriDyn Material Adverse Effect.  All material TetriDyn Easements are valid and enforceable and grant the rights purported to be granted thereby and all rights necessary thereunder for the current operation of such business.

Section 4.23                      Futures Trading and Fixed Price Exposure

TetriDyn is not presently engaged in any futures or options trading nor is it a party to any price, interest rate, or currency swaps, hedges, futures, or other derivative instruments.

 

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Section 4.24                      Intellectual Property

(a)           Schedule 4.24(a) of the TetriDyn Schedules lists all the registered patents, trademarks, service marks, copyrights, trade names, and applications for any of the foregoing owned by TetriDyn as of the date of this Agreement (the “TetriDyn Registered Intellectual Property”).  TetriDyn has good and marketable title to the TetriDyn Registered Intellectual Property and has good and marketable title to, or valid licenses or rights to use, all patents, copyrights, trademarks, trade names, brand names, proprietary and other technical information, technology, and software (collectively, “TetriDyn Intellectual Property”) used in the operation of its business as presently conducted, free from any liens and free from any requirement of any past, present, or future royalty payments, license fees, charges or other payments, or conditions or restrictions, whatsoever, except as set forth on Schedule 4.24(a).  Immediately after the Effective Time, the Surviving Corporation will own or will have the right to use all TetriDyn Intellectual Property free from liens.

(b)           To the best of its knowledge, TetriDyn has not infringed and is not infringing upon, and has not engaged and is not engaging in, any unauthorized use or misappropriation of any patents, copyrights, trademarks, trade names, brand names, proprietary and other technical information, technology, and software owned by or belonging to any other person.  Except as set forth in Schedule 4.24(b) of the TetriDyn Schedules, there are no claims or proceedings pending or, to TetriDyn’s knowledge, threatened against TetriDyn asserting that TetriDyn is infringing or engaging in the unauthorized use or misappropriation of any intellectual property of any other person.

(c)           TetriDyn is not aware of prior art respecting any of the patents owned or licensed by it that was not disclosed to the U.S. Patent and Trademark Office (or to any comparable foreign authority, if necessary) in connection with applications for such patents.  TetriDyn is not aware of any fact or event making any one or more claims of any of such patents invalid or unenforceable, and TetriDyn has not engaged in any conduct or omitted to perform any necessary act, the result of which would be to invalidate any of such patents or adversely affect any of their enforceability.

(d)           Schedule 4.24(d) of the TetriDyn Schedules sets forth all agreements and arrangements pursuant to which: (i) TetriDyn has licensed TetriDyn Intellectual Property to, or the use of TetriDyn Intellectual Property in other areas permitted (through nonassertion, settlement, or similar agreements or otherwise) by, any other person; and (ii) TetriDyn has had TetriDyn Intellectual Property licensed to it, or has otherwise been permitted to use TetriDyn Intellectual Property (through nonassertion, settlement, or similar agreements or otherwise).  All of the agreements or arrangements to the extent set forth on Schedule 4.24(d): (x) are in full force and effect in accordance with their terms and TetriDyn is not aware that any default exists thereunder by TetriDyn or by any other party thereto; (xi) are free and clear of liens; (xii) do not contain any change of control or other terms or conditions that will become applicable or inapplicable as a result of the consummation of the Merger and the transactions contemplated by this Agreement.  TetriDyn has delivered to OTE true and complete copies of all agreements and arrangements set forth on Schedule 4.24(d).  There are no royalties, license fees, charges, or other amounts payable by, or on behalf of, TetriDyn for of any TetriDyn Intellectual Property other than as set forth on Schedule 4.24(d).

Section 4.25                      Transactions with Affiliates

Schedule 4.25 of the TetriDyn Schedules sets forth a description of every material contract, agreement, or arrangement between TetriDyn and any person who is or has ever been an officer or director of TetriDyn, or person of record or known by TetriDyn to have beneficial ownership of 10% or more of the issued and outstanding TetriDyn Stock, and which is to be performed, in whole or in part, after the date hereof or was entered into within three years before the date hereof.  In all of such circumstances, the contract, agreement, or arrangement was for a bona fide business purpose of TetriDyn, and the amount paid or received, whether in cash, services, or kind is, has been during the full term thereof, and is required to be during the unexpired portion of the term thereof, no less favorable to TetriDyn than terms available from otherwise unrelated parties in arm’s-length transactions.  Except as disclosed in Schedule 4.25 or otherwise disclosed herein, no officer or director of TetriDyn or 10% shareholder of TetriDyn has, or has had during the preceding three years, any interest, directly or indirectly, in any material transaction with TetriDyn.  Schedule 4.25 also includes a description of any commitment by TetriDyn, whether written or oral, to lend any funds to, borrow any money from, or enter into any other material transaction with any such affiliated person.

 

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Section 4.26                      Compliance with Securities Laws

All of the securities offered and sold by TetriDyn within three years prior to the date of this Agreement were issued in transactions exempt from registration under the Securities Act and applicable state securities Laws.

Section 4.27                      Disclosure Controls

TetriDyn maintains systems of internal accounting controls sufficient to provide reasonable assurance that: (a) transactions are executed in accordance with management’s general or specific authorizations; (b) transactions are recorded as necessary to permit preparation of financial statements in conformity with generally accepted accounting principles and to maintain asset accountability; (c) access to assets is permitted only in accordance with management’s general or specific authorization; and (d) the recorded accountability for assets is compared with the existing assets at reasonable intervals and appropriate action is taken respecting any differences.

Section 4.28                      Off Balance Sheet Arrangements

There are no off balance sheet transactions that would reasonably be expected to affect materially TetriDyn’s liquidity or the availability of or requirements for its capital resources.

Section 4.29                      Forward-Looking Statement

No Forward Looking Statement contained in TetriDyn Schedules or Periodic Reports has been made or reaffirmed without a reasonable basis or has been disclosed other than in good faith.

Section 4.30                      No Improper Practices

Except as set forth in Schedule 4.30 of the TetriDyn Schedules: (a) neither TetriDyn nor, to TetriDyn’s knowledge, any director, officer, agent, employee or other person associated with or acting on TetriDyn’s behalf has, in the past three years, made any unlawful contributions to any candidate for any political office (or failed fully to disclose any contribution in violation of law); made any contribution or other payment to any official of, or candidate for, any federal, state, municipal, or foreign office or other person charged with similar public or quasi-public duty in violation of any law or of the character required; (b) following the Closing, TetriDyn will not be required by the Exchange Act to disclose any contributions or payments in any Periodic Report required to be filed pursuant to Section 13 or 15(d) thereunder; (c) no relationship, direct or indirect, exists between or among TetriDyn or, to TetriDyn’s knowledge any affiliate, on the one hand, and the directors, officers, and stockholders of TetriDyn, on the other hand, that TetriDyn is required, or will be required, by the Exchange Act to describe in any Periodic Report following the Closing; and (d) there are no material outstanding loans or advances or material guarantees of indebtedness by TetriDyn to, or for the benefit of, any of its officers or directors or any of the members of the families of any of them that TetriDyn is required, or will be required, by the Exchange Act to describe in any Periodic Report following the Closing.

Section 4.31                      OFAC

Neither TetriDyn nor, to TetriDyn’s knowledge, any director, officer, agent, employee or other affiliate of TetriDyn or any of its subsidiaries is currently subject to any U.S. sanctions administered by OFAC.

Section 4.32                      Minute Book

TetriDyn’s minute book contains, and will contain at the Closing Date, a complete record of all meetings, consents, or other actions of its board of directors and shareholders for the period from inception through the date hereof and accurately reflects the substance of all transactions referred to in such minutes in all material respects.

 

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ARTICLE V

ADDITIONAL AGREEMENTS

Section 5.01                      California Corporations Code Section 25142 “Fairness” Permit

As soon as practicable following the execution and delivery of this Agreement, but in any event within 30 days following such date, TetriDyn shall, with the collaboration of OTE, prepare and file with the California Department of Corporations (the “Department”) an application pursuant to Section 25142 of the California Corporations Code to submit the Merger and the transactions contemplated by this Agreement for approval by the commissioner of such Department of the fairness of the terms and conditions of the issuance of New TetriDyn Stock and the exchange of such New TetriDyn Stock for the OTE Stock outstanding and issuable on the exercise of outstanding warrants, the conversion of outstanding bonds, and the payment of stock purchase subscriptions for the purchase of OTE Stock (if any).  The Parties shall prosecute such application with diligence and dispatch in order to obtain the requested approval and determination of the fairness of the terms of the Merger and the transactions contemplated by this Agreement at the earliest practicable date in order to obtain a valid and binding permit pursuant to Section 25142 of the California Corporations Code (the “Permit”) to provide an exemption from the securities registration and prospectus delivery requirements pursuant thereto and pursuant to Section 3(a)(10) of the Securities Act.

Section 5.02                      Approvals of Stockholders

(a)           As soon as practicable following the execution and delivery of this Agreement and the issuance of the Permit from the Department as contemplated by section 5.01, but in any event within 10 days following such date, OTE shall submit to its stockholders for approval by majority written consent the proposal to approve the Merger, this Agreement, and the transactions contemplated by this Agreement in accordance with the applicable provisions of Delaware Law and all applicable federal and state securities Laws.  OTE shall solicit such majority written consents in reliance on the exemption from registration under Section 4(a)(2) of the Securities Act and Rule 506 of Regulation D promulgated thereunder and preemption from the registration or qualification requirements (other than notice filing and fee provisions) of applicable state Laws under the National Securities Markets Improvement Act of 1996.

(b)           As soon as practicable following the execution and delivery of this Agreement, but in any event within 30 days following such date, TetriDyn shall submit to its stockholders for approval by majority written consent the proposal to approve the Merger, this Agreement, the Recapitalization, the election of directors as provided in this Agreement, the change of the name of TetriDyn as contemplated by this Agreement, and the transactions contemplated hereby in accordance with the applicable provisions of the Laws of the jurisdiction under which it is incorporated and all applicable federal and state securities Laws.

Section 5.03                      Access and Information

(a)           TetriDyn shall: (i) afford OTE and its officers, directors, employees, accountants, consultants, legal counsel, agents, and other representatives (collectively, the “OTE Representatives”) reasonable access at reasonable times, upon reasonable prior notice, to the officers, directors, employees, agents, properties, offices, and other facilities of TetriDyn and to the books and records thereof; and (ii) furnish promptly to OTE and the OTE Representatives such information concerning the business, properties, contracts, records, and personnel of TetriDyn (including financial, operating, and other data and information) as may be reasonably requested, from time to time, by OTE and the OTE Representatives.

(b)           OTE shall: (i) afford to TetriDyn and its officers, directors, employees, accountants, consultants, legal counsel, agents, and other representatives (collectively, the “TetriDyn Representatives”), reasonable access at reasonable times, upon reasonable prior notice, to the officers, directors, employees, accountants, agents, properties, offices, and other facilities of OTE (including any subsidiary) and to the books and records thereof; and (ii) furnish promptly to TetriDyn and the TetriDyn Representatives such information concerning the business, properties, contracts, records, and personnel of OTE (including any subsidiary) (including financial, operating, and other data and information) as may be reasonably requested, from time to time, by TetriDyn and the TetriDyn Representatives.

 

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(c)           Notwithstanding the foregoing provisions of this section, no Party shall be required to grant access or furnish information to the other Party to the extent that such access to or the furnishing of such information is prohibited by Law.  No investigation by the Parties made heretofore or hereafter shall affect the representations and warranties of the Parties that are herein contained, and each such representation and warranty shall survive such investigation.

(d)           The information received pursuant to this section shall be deemed to be “Confidential Information.”  Each Party agrees that it will treat in confidence all documents, materials, and other Confidential Information that it shall have obtained regarding the other Party during the course of the negotiations leading to the consummation of the transactions contemplated hereby (whether obtained before or after the date of this Agreement), the investigation provided for herein, and the preparation of this Agreement and other related documents.  Such documents, materials, and other Confidential Information shall not be communicated to any third person (other than to such Party’s respective counsel, accountants, financial advisers, or lenders) and shall not be used for any purpose to the detriment of the other Party.  No Party shall use any Confidential Information in any manner whatsoever except solely for the purpose of evaluating a possible business relationship with the other Party.  No Party and no OTE Representative or TetriDyn Representative will, during the term of this Agreement or at any time during the two years thereafter, irrespective of the time, manner, or cause of termination of this Agreement, use, disclose, copy, or assist any other person in the use, disclosure, or copying of any documents, materials, or other Confidential Information of the other Party.

Section 5.04                      Other State Securities Laws

(a)           TetriDyn shall prepare and file such other notices or applications as TetriDyn may deem appropriate under applicable state securities Laws in connection with the transactions contemplated by this Agreement.  OTE and TetriDyn shall take any action required to be taken under any applicable federal or state securities Laws in connection with the issuance of shares of New TetriDyn Stock in the Merger.  OTE shall furnish to TetriDyn all information concerning OTE and the holders of its capital stock as TetriDyn may reasonably request in connection with such actions.  All documents that TetriDyn is responsible for filing with the SEC or any state authority in connection with the transactions contemplated herein shall comply as to form in all material respects with the applicable requirements of the Securities Act and the rules and regulations thereunder, the Exchange Act and the rules and regulations thereunder, and state securities Laws and applicable state Laws.

(b)           The information supplied by TetriDyn for inclusion in the notices or other filings in accordance with this section shall not, at the time filed, contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary in order to make the statements therein not misleading.  If at any time prior to the Effective Time any event or circumstance relating to TetriDyn or any of its affiliates, or its or their respective officers or directors, is discovered by TetriDyn that should be set forth in a supplement or amendment to any notices or other filings in accordance with section 5.04(a), TetriDyn shall promptly inform OTE thereof in writing.

(c)           The information supplied by OTE for inclusion in the notices or other filings in accordance with section 5.04(a) shall not, at the time filed, contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary in order to make the statements therein not misleading.  If at any time prior to the Effective Time any event or circumstance relating to OTE or any of its affiliates, or to its respective officers, directors, partners, or managers is discovered by OTE that should be set forth in a supplement or amendment to the notices or other filings in accordance with section 5.04(a), OTE shall promptly inform TetriDyn thereof in writing.

 

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Section 5.05                      Appropriate Action; Consents; Filings

(a)           OTE and TetriDyn shall use, and shall cause each of their respective subsidiaries to use, all reasonable efforts to: (i) take, or cause to be taken, all appropriate action, and do, or cause to be done, all things necessary, proper, or advisable under applicable Laws or otherwise to consummate and make effective the transactions contemplated by this Agreement; (ii) obtain from any Governmental Entities any consents, licenses, permits, waivers, approvals, authorizations, or orders required to be obtained or made by OTE or TetriDyn or any subsidiary in connection with the authorization, execution, and delivery of this Agreement and the consummation of the transactions contemplated hereby, including the Merger; (iii) make all necessary filings, and thereafter make any other required submissions, respecting this Agreement and the Merger required under: (1) the Securities Act and the Exchange Act, and the rules and regulations thereunder, and any other applicable federal or state securities Laws; and (2) any other applicable Law; provided that, OTE and TetriDyn shall cooperate with each other in connection with the making of all such filings, including providing copies of all such documents to the other Party and its advisers prior to such filings and, if requested, shall accept all reasonable additions, deletions, or changes suggested in connection therewith.  OTE and TetriDyn shall furnish all information required for any application or other filing to be made pursuant to the rules and regulations of any applicable Law in connection with the transactions contemplated by this Agreement.

(b)           OTE and TetriDyn agree to cooperate respecting, to cause each of their respective subsidiaries to cooperate respecting, and to use all reasonable efforts vigorously to contest and resist any action, including legislative, administrative, or judicial action, and to have vacated, lifted, reversed, or overturned any decree, judgment, injunction, or other order (whether temporary, preliminary, or permanent) (an “Order”) of any Governmental Entity that is in effect and that restricts, prevents, or prohibits the consummation of the Merger or any other transactions contemplated by this Agreement, including by vigorously pursuing all available avenues of administrative and judicial appeal and legislative action.  OTE and TetriDyn also agree to take all actions, including the disposition of assets or the withdrawal from doing business in particular jurisdictions, required by regulatory authorities as a condition to the granting of any approvals required in order to permit the consummation of the Merger or as may be required to avoid, lift, vacate, or reverse any legislative or judicial action that would otherwise cause any condition to Closing not to be satisfied; provided, however, that in no event shall OTE be required to take any action that would or could reasonably be expected to have an OTE Material Adverse Effect, and TetriDyn shall not be required to take any action that would or could reasonably be expected to have a TetriDyn Material Adverse Effect.

(c)

(i)           OTE and TetriDyn shall give any notices to third parties, and use and cause their respective subsidiaries to use all reasonable efforts to obtain any third-party consents: (1) necessary, proper, or advisable to consummate the transactions contemplated by this Agreement; (2) otherwise required under any contracts, licenses, leases, or other agreements in connection with the consummation of the transactions contemplated hereby; or (3) required to prevent a material adverse effect affecting either of their respective business and operations from occurring prior to the Effective Time or a TetriDyn Material Adverse Effect from occurring after the Effective Time.

(ii)           OTE and TetriDyn shall use and cause their respective subsidiaries to use all reasonable efforts to obtain release of any guarantees by any owner of TetriDyn of any third-party indebtedness or obligation that will not be paid, discharged, or otherwise satisfied at the Effective Time, excluding the obligations to SICOG and EIDC as set forth in subsection 5.12(c).

(iii)           In the event that any Party shall fail to obtain any third-party consent described in subsection (c)(ii) above, such Party shall use all reasonable efforts, and shall take any such actions reasonably requested by any other Party, to limit the adverse effect upon OTE and TetriDyn, and their respective subsidiaries and their respective businesses, resulting or that could reasonably be expected to result after the Effective Time, from the failure to obtain such consent.

 

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(d)           OTE and TetriDyn shall promptly notify the other of: (i) any material change in its current or future business, assets, liabilities, financial condition, or results of operations; (ii) any complaints, investigations, or hearings (or communications indicating that the same may be contemplated) of any Governmental Entities respecting its business or the transactions contemplated hereby; (iii) the institution or the threat of material litigation involving it or any of its subsidiaries; or (iv) any event or condition that might reasonably be expected to cause any of its representations, warranties, covenants, or agreements set forth herein not to be true and correct at the Effective Time.  As used in the preceding sentence, “material litigation” means any case, arbitration, or adversary proceeding or other matter that is material to the business and operations of the subject entity, if in existence on the date hereof, or for which the legal fees and other costs to TetriDyn might reasonably be expected to exceed $10,000 over the life of the matter or to OTE (or any subsidiary) might reasonably be expected to exceed $10,000 over the life of the matter.

Section 5.06                      Acquisition of New TetriDyn Stock

The consummation of this Agreement and the transactions contemplated herein, including the issuance of the New TetriDyn Stock to the stockholders of OTE as contemplated hereby, constitutes the offer and sale of securities under the Securities Act and applicable state securities Laws.  Such transactions shall be consummated in reliance on in reliance on the exemption from registration under Section 3(a)(10) of the Securities Act, as clarified in Staff Legal Bulletin No. 3A (June 18, 2008).

(a)           In order to provide documentation for reliance upon exemptions from the registration and prospectus delivery requirements for such transactions, the approval of the Merger and this Agreement by the stockholders of OTE, and the acceptance and receipt of the New TetriDyn Stock, in tendering their OTE securities for exchange into New OTE Stock pursuant to the Merger, each OTE Stockholder will be required to acknowledge and represent in writing his acceptance of, and concurrence in, each stockholder of OTE shall make the following representations and warranties:

(i)           Each acknowledges that neither the SEC nor the securities commission of any state or other federal agency has made any determination as to the merits of acquiring the New TetriDyn Stock, and that the transactions contemplated herein involve certain risks.

(ii)           Each has received and read this Agreement and has had access to the related schedules and exhibits and understands the risks related to the consummation of the transactions herein contemplated.

(iii)           Each has such knowledge and experience in business and financial matters that such stockholder is capable of evaluating the Merger and TetriDyn and its proposed business operations.

(iv)           Each has been provided with a copy of this Agreement, plus all materials and information requested by his or her representative, including any information requested to verify any information furnished (to the extent such information is available or can be obtained without unreasonable effort or expense), and each has been provided the opportunity for direct communication with TetriDyn and the TetriDyn Representatives regarding the transactions contemplated hereby.

(v)           All information that each has provided to TetriDyn or the TetriDyn Representatives concerning such stockholder’s suitability to hold shares in TetriDyn following the transactions contemplated hereby is complete, accurate, and correct.

(vi)           Each has not offered or sold any interest in this Agreement and has no present intention of dividing the New TetriDyn Stock to be received or the rights under this Agreement with others or of reselling or otherwise disposing of any portion of such stock or rights, either currently or after the passage of a fixed or determinable period of time or on the occurrence or nonoccurrence of any predetermined event or circumstance.

 

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(vii)           Each received notice of, and had the opportunity to participate in, the proceedings before the Department as set forth in section 5.01.

(viii)           Each is able to bear the economic risks of this investment, and consequently, without limiting the generality of the foregoing, is able to hold the New TetriDyn Stock to be received for an indefinite period.

(ix)           Each understands that the New TetriDyn Stock has not been registered, but is being acquired by reason of a specific exemption under the Securities Act as well as under certain state securities Laws for the issuance of securities in exchange for one or more bona fide outstanding securities, claims, or property interests when the terms and conditions of such issuance and exchange are approved, after a hearing upon the fairness of such terms and conditions at which all persons to whom it is proposed to issue securities in such exchange shall have the right to appear, by a duly authorized governmental authority such as the Department, as well as corresponding provisions of the securities Laws of other states.

(b)           Each Party acknowledges that no legal opinion or other assurance will be required or given to the effect that the transactions contemplated hereby are in fact exempt from registration or qualification.

Section 5.07                      Limitations on Resale of New TetriDyn Stock Following Possible Public Offering

In order to facilitate the possibility of a public offering of TetriDyn Stock, the New TetriDyn Stock issuable in accordance with this Agreement shall be subject to the restrictions set forth in this section.

(a)           The New TetriDyn Stock issuable in accordance with this Agreement cannot be resold: (i) until at least 180 days after the Effective Time; and (ii) during a period commencing on the date of filing by TetriDyn of a registration statement under the Securities Act for a firm commitment underwritten public offering for cash by TetriDyn of TetriDyn Stock or securities convertible into or exercisable or exchangeable for TetriDyn Stock and continuing until the earlier of abandonment of the proposed public offering or 180 days following the date of the last closing in the public offering (the “Restricted Period”).  Holders of such New TetriDyn Stock will cooperate with TetriDyn in providing reasonable written assurances respecting the foregoing to the underwriter of any such public offering.

(b)           During the Restricted Period, holders of New TetriDyn Stock may not directly or indirectly sell, offer to sell, contract to sell (including any short sale), grant any option to purchase, or otherwise transfer or dispose of (other than to donees who agree to be similarly bound) shares of New TetriDyn Stock received in connection with this Agreement at any time during such period except securities included in such registration.

(c)           In order to enforce the covenant set forth in this section 5.07, TetriDyn shall have the right to impose stop-transfer instructions respecting such shares of New TetriDyn Stock, which shall be binding on any holder or assignee (and the shares or securities of every other person subject to the foregoing restriction), until the end of such Restricted Period.

Section 5.08                      No Representation or Opinions Regarding Certain Legal Matters

(a)           Except for the representations and warranties set forth in section 3.10 and section 4.10, no representation or warranty is being made or legal opinion given by any Party to any other regarding the treatment of this transaction for federal or state income taxation.  Although this transaction has been structured in an effort to qualify for treatment under Section 368(a)(1)(A) and Section 368(a)(2)(E) of the Code, there is no assurance that any part of this transaction in fact meets the requirements for such qualification.  Each Party has relied exclusively on its own legal, accounting, and other tax advisers regarding the treatment of this transaction for federal and state income taxes and on no representation, warranty, or assurance from any other Party or such other Party’s legal, accounting, or other advisers.

 

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(b)           Notwithstanding the covenants respecting reliance on an exemption from registration under the Securities Act and limited preemption under applicable state Laws set forth in this Article V, each Party acknowledges that it has relied exclusively on its own legal advisers regarding the availability of such exemption and preemption and on no representation, warranty, or assurance from any other Party or such other Party’s legal advisers.  Inasmuch as the basis for relying on exemptions is factual, depending on the conduct of the Parties and their representatives in connection with the Merger and soliciting stockholder consents, the Parties will not receive a legal opinion to the effect that this Merger and the issuance of New TetriDyn Stock are exempt or preempted from registration under any federal or state law.  Instead, the Parties will rely on the operative facts as documented by them as their basis for such exemptions.

Section 5.09                      Public Announcements

Neither Party shall issue any press release or otherwise make any public statements respecting the Merger without the approval of the other Party.  The press release announcing the execution and delivery of this Agreement shall be a joint press release of OTE and TetriDyn.

Section 5.10                      Board of Directors and Officers

The Parties anticipate that the persons identified on Exhibit B shall become the directors of TetriDyn and the Surviving Corporation, as indicated.  At the Closing, the persons elected as directors of TetriDyn pursuant to majority stockholder written consent shall take office, with each director to serve until his successor is elected and qualified.  The continuing management of TetriDyn and the Surviving Corporation, subject to further discretion of the reorganized board of directors, shall be also as set forth on Exhibit B attached hereto and incorporated herein by reference.

Section 5.11                      [Reserved]

Section 5.12                      Post-Closing Matters

The covenants and agreements set forth in this section 5.12 shall survive the Closing, notwithstanding any other contrary provision of this Agreement:

(a)           TetriDyn shall file with the Nevada Secretary of State of Nevada an amendment to its articles of incorporation changing its name in accordance with the terms of this Agreement.

(b)           To the extent not previously completed, TetriDyn will promptly, but in any event within 30 days after the Closing, seek to restructure the indebtedness to the Southeast Idaho Council of Governments, Inc. (SICOG), and Eastern Idaho Development Corp (EIDC) as set forth in TetriDyn Schedule 4.07.  To facilitate such restructuring, OTE shall cause a principal stockholder, JPF Venture Group, Inc., to provide its accommodation guarantee of TetriDyn’s obligations to such creditors.

(c)           To the extent not previously completed, TetriDyn will promptly, but in any event within 10 days after the Closing and upon receipt of invoices or other supporting documentation therefor, pay to:

(i)           the applicable credit card creditor approximately $33,200, plus accrued interest, due on the personal credit cards of TetriDyn’s current president, Antoinette Knapp Hempstead, for business expenses of TetriDyn, as set forth in TetriDyn Schedule 4.07;

(ii)           reimburse Antoinette Knapp Hempstead for her actual payments to SICOG and EIDC as guarantor of payments due from TetriDyn on loans from such creditors after March 1, 2015; and

(iii)           Kruse Landa Maycock and Ricks, LLC, the sum of $15,000 for professional services rendered and costs advanced, with the balance of $26,587 as of January 31, 2015, plus additional amounts billed until the Closing, payable by TetriDyn in installments of $5,000 per month commencing within 30 days after such closing, until paid, with the unpaid balance accelerated and payable immediately from its first equity financing exceeding $1.0 million or completion of funding for the Baha Mar property.

 

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(d)           All of the issued and outstanding shares of TetriDyn Preferred Stock returned to TetriDyn at the execution of this Agreement shall have been cancelled.

(e)           All of the issued and outstanding shares of TetriDyn common stock issued pursuant to the Investment Agreement returned by JPF to TetriDyn at the Closing shall be cancelled.

(f)           TetriDyn shall authorize and pursue to completion at the earliest practicable date audited financial statements for TetriDyn for the years ended December 31, 2012, 2013, and 2014; audited financial statements for OTE for the year ended December 31, 2014, in each case with an unqualified opinion thereon by a firm of independent certified public accounts; and pro forma financial statements providing the required information to be included in Periodic Reports required to be filed by TetriDyn.  Parallel with the completion of the foregoing financial statements, TetriDyn will prepare or cause to be prepared all other Periodic Reports required to be completed in order for TetriDyn to become current in filing its Periodic Reports at the earliest practicable date.

(g)           Promptly following the completion and filing of its Periodic Reports required to become current, TetriDyn shall take such steps as shall reasonably be required to make its common stock eligible for quotation on the OTCBB, with a trading symbol selected by TetriDyn to reflect its name following the Merger.

ARTICLE VI

CLOSING CONDITIONS

Section 6.01                      Third-Party Conditions to Obligations of the Parties under this Agreement

The respective obligations of the Parties to effect the Merger and the other transactions contemplated hereby shall be subject to the satisfaction at or prior to the Closing Date of the following conditions, any or all of which may be waived in writing by the Parties hereto, in whole or in part, to the extent permitted by applicable Law:

(a)           The Department shall have issued the Permit approving the fairness of the transaction in accordance with section 5.01 of this Agreement and Section 25142 of the California Corporations Code.

(b)           As required under applicable Delaware Law, this Agreement and the Merger shall have been approved and adopted by the requisite vote of the stockholders of OTE and MergerCo.

(c)           No Governmental Entity or federal or state court of competent jurisdiction shall have enacted, issued, promulgated, enforced, or entered any statute, rule, regulation, executive order, decree, injunction, or other order (whether temporary, preliminary, or permanent) that is in effect and which has the effect of making the Merger illegal or otherwise prohibiting consummation of the Merger.

Section 6.02                      Additional Conditions to Obligations of the Parties

The obligations of each Party to effect the Merger and the other transactions contemplated hereby are also subject to the satisfaction at or prior to the Closing Date of the following conditions, any or all of which may be waived in writing by the other Party, in whole or in part, to the extent permitted by applicable Law:

(a)           OTE shall have received written consents of the holders of a majority of its issued and outstanding OTE Stock in accordance with section 5.02(a) of this Agreement, and TetriDyn shall have received written consents of the holders of a majority of the issued and outstanding TetriDyn Stock and the holders of a majority of the TetriDyn stock held by TetriDyn stockholder not having any affiliation with OTE, in accordance with section 5.02(b) of this Agreement.

(b)           The holders of less than 3% of the issued and outstanding OTE Stock shall have perfected their rights as Dissenting OTE Stockholders in accordance with Delaware Law and section 2.01(e) of this Agreement.

 

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(b)           Each of the representations and warranties of the other Party contained in this Agreement shall be true and correct as of the Closing Date as though made on and as of the Closing Date (except to the extent such representations and warranties specifically relate to an earlier date, in which case such representations and warranties shall be true and correct as of such earlier date).  Each Party shall have received a certificate of the president and the chief financial officer or substantially equivalent authority of the other Party, dated the Closing Date, to such effect.

(c)           Each Party shall have performed or complied with all agreements and covenants required by this Agreement to be performed or complied with by it on or prior to the Closing Date.  Each Party shall have received a certificate of the president and the chief financial officer or substantially equivalent authority of the other Party, dated the Closing Date, to such effect.

(d)           Since the date of this Agreement, there shall have been no change, occurrence, or circumstance in the current or future business, assets, liabilities, financial condition, or results of operations of the other Party having or reasonably likely to have, individually or in the aggregate, a TetriDyn Material Adverse Effect or OTE Adverse Effect, as the case may be.  Each Party shall have received a certificate of the president and the chief financial officer or substantially equivalent authority of the other Party, dated the Closing Date, to such effect.

(e)           There shall not have been any action taken, or any statute, rule, regulation, or order enacted, entered, enforced, or deemed applicable to the Merger, by any Governmental Entity in connection with the grant of a regulatory approval necessary, in the reasonable business judgment of either Party, to the continuing operation of the current or future business of TetriDyn or that imposes any condition or restriction upon the other Party, its business or operations that, in the reasonable business judgment of such Party, would be materially burdensome in the context of the transactions contemplated by this Agreement.

(f)           The number of shares of OTE Stock for which valid notices of intention to demand payment pursuant to the applicable provisions of Delaware Law have been provided and remain outstanding immediately prior to the effectiveness of the Merger does not exceed that number of shares that, if converted in accordance with the terms of this Agreement, would constitute more than 2% of the total number of shares of New TetriDyn Stock issuable at the Effective Time.

Section 6.03                      TetriDyn Recapitalization

In order to effect the Merger, immediately preceding the Closing TetriDyn shall effect the Recapitalization that consists of a 4.6972-to-one reverse split of its 24,031,863 shares of issued and outstanding common stock and the increase of its authorized common stock to 200,000,000 shares, par value $0.001 (the “Reverse Split”).  As a result of the Reverse Split, each record holder of less than 5 shares of TetriDyn Common Stock immediately prior to the Reverse Split (the “Minority Stockholders”), will receive from TetriDyn, cash in the amount of $0.03 per share of TetriDyn Common Stock held by them, without interest, for each share of TetriDyn Common Stock held by such stockholders immediately prior to the Reverse Split, and such Minority Stockholders will no longer be stockholders of TetriDyn.  No fractional shares will be issued in connection with the Reverse Split.  TetriDyn stockholders who otherwise would be entitled to receive fractional shares because they hold a number of pre-Reverse Split TetriDyn shares not evenly divisible by 4.6972 will have the number of post-Reverse Split TetriDyn shares to which they are entitled rounded up to the next whole number of TetriDyn shares.  No TetriDyn stockholders will receive cash in lieu of fractional shares.

ARTICLE VII

TERMINATION, AMENDMENT AND WAIVER

Section 7.01                      Termination

This Agreement may be terminated at any time prior to the Effective Time, whether before or after approval of this Agreement and the Merger by the stockholders of OTE in such case where approval is required:

(a)           by mutual consent of OTE and TetriDyn;

 

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(b)           by either Party, upon a material breach of any representation, warranty, covenant, or agreement on the part of the other Party set forth in this Agreement such that the conditions set forth in section 6.02(a) or section 6.02(b) of this Agreement, as the case may be, would be incapable of being satisfied by May 31, 2015 (or as otherwise extended as described in subsection (d) of this section 7.01); provided that, in any case, a willful breach shall be deemed to cause such condition as to be incapable of being satisfied for purposes of this section 7.01(b);

(c)           by either Party, if there shall be any Order that is final and nonappealable preventing the consummation of the Merger, except if the Party relying on such Order to terminate this Agreement has not complied with its obligations under section 5.05(b) of this Agreement; or

(d)           by either Party, if: (i) JPF shall have not paid for its subscription for shares of TetriDyn Stock in accordance with the Investment Agreement by March 18, 2015; (ii) the Department shall not have issued the Permit by May 15, 2015; or (iii) notwithstanding the Department having issued the Permit, the Merger shall not have been consummated within 20 days thereafter; provided, however, that this Agreement may be extended by written notice of either Party to the other to a date not later than May 15, 2015, if the Merger shall not have been consummated as a direct result of such notifying Party having failed by May 15, 2015, to receive all required regulatory approvals or consents respecting the Merger.

The right of the Parties to terminate this Agreement pursuant to this section 7.01 shall remain operative and in full force and effect regardless of any investigation made by or on behalf of either Party, any person controlling such Party, or any of its officers, directors, managers, partners, representatives, or agents, whether prior to or after the execution of this Agreement.

Section 7.02                      Effect of Termination

Except as provided in section 7.05 or section 8.01 of this Agreement, in the event of the termination of this Agreement pursuant to section 7.01, this Agreement shall forthwith become void, there shall be no liability on the part of one Party to the other Party to consummate the transaction contemplated by this Agreement, and all rights and obligations of either Party shall cease, except that nothing herein shall relieve any Party of any liability for any breach of such Party’s covenants or agreements contained in this Agreement or any willful breach of such Party’s representations or warranties contained in this Agreement.

Section 7.03                      Amendment

This Agreement may be amended by the Parties by action taken by or on behalf of their respective boards of directors, general partner(s), manager(s), or other governing body at any time prior to the Effective Time; provided, however, that, after approval of the Merger by the stockholders of a Party, no amendment that under applicable Law may not be made without the approval of the stockholders of such Party may be made without such approval.  This Agreement may not be amended except by an instrument in writing signed by both Parties.

Section 7.04                      Waiver

At any time prior to the Effective Time, either Party may extend the time for the performance of any of the obligations or other acts of the other Party, waive any inaccuracies in the representations and warranties of the other Party contained herein or in any document delivered pursuant hereto, and waive compliance by the other Party with any of the agreements or conditions contained herein.  Any such extension or waiver shall be valid only if set forth in an instrument in writing signed by Parties.

Section 7.05                      Fees, Expenses, and Other Payments

(a)           In the event the Merger is not consummated, all Expenses (as defined in subsection 7.05(b)) incurred by the Parties shall be borne solely and entirely by the Party that has incurred such Expenses.

 

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(b)           “Expenses” as used in this section 7.05 shall include all out-of-pocket expenses (including all fees and expenses of counsel, accountants, investment bankers, experts, and consultants to a Party and its affiliates) incurred by a Party or on its behalf in connection with or related to the authorization, preparation, negotiation, execution, and performance of this Agreement, the preparation, printing, filing, and mailing of communications to stockholders, the solicitation of approvals of stockholders, and all other matters related to the consummation of the transactions contemplated hereby.

ARTICLE VIII

GENERAL PROVISIONS

Section 8.01                      Effectiveness of Representations, Warranties, and Agreements; Survival

Prior to the execution of this Agreement, each Party has made available to the other Party the opportunity to review any disclosures made pursuant to this Agreement and other information available in accordance with the provisions of section 5.03.  Each Party has been afforded the opportunity to engage its own attorneys, accountants, and other advisers to assist in the review of such schedules and other information and has made its own decision respecting the extent to which such Party has engaged such attorneys, accountants, and other advisers.  The representations, warranties, and agreements of each Party shall remain operative and in full force and effect regardless of any investigation made by or on behalf of the other Party, any person controlling such Party, or any of its officers, directors, managers, partners, representatives, attorneys, accountants, or agents, whether prior to or after the execution of this Agreement.

Section 8.02                      Notices

Any notice, demand, request, or other communication permitted or required under this Agreement shall be in writing and shall be deemed to have been given as of the date so delivered, if personally delivered; as of the date so sent, if sent by electronic mail and receipt is acknowledged by the recipient; one day after the date so sent, if delivered by overnight courier service; or three days after the date so mailed, if mailed by certified mail, return receipt requested, addressed as follows:

(a)           If to OTE, to:                         Ocean Thermal Energy Corporation

800 South Queen Street

Lancaster, Pennsylvania 17603 

Attn: Jeremy P. Feakins

Email: Jeremy.Feakins@otecorporation.com

with a copy to:                      Procopio Cory Hargreaves & Savitch LLP

                                12544 High Bluff Drive, Suite 300

                                San Diego, California 92130

                                Attn: John P. Cleary

                                Email: john.cleary@procopio.com

(b)           If to TetriDyn, to:                 TetriDyn Solutions, Inc.

c/o Antoinette Hempstead

6759 S Valence Lane

West Jordan, UT  84084

E-mail: toni.hempstead@gmail.com

with a copy to:                      Kruse Landa Maycock & Ricks, LLC

136 East South Temple Street, Suite 2100

Salt Lake City, Utah 84111

Attn: James R. Kruse

Email jkruse@klmrlaw.com

Notwithstanding the foregoing, service of legal process or other similar communications shall not be given by electronic mail and will not be deemed duly given under this Agreement if delivered by such means.  Each Party, by notice duly given in accordance herewith, may specify a different address for the giving of any notice hereunder.

 

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Section 8.03                      Certain Definitions

For the purposes of this Agreement:

(a)           the term “affiliate” means a person that directly, or indirectly through one or more intermediaries, controls, is controlled by, or is under common control with, the first mentioned person;

(b)           a person shall be deemed a “beneficial owner” of or to have “beneficial ownership” of TetriDyn Stock or OTE Stock, as the case may be, in accordance with the interpretation of the term “beneficial ownership” as defined in Rule 13d-3 under the Exchange Act, as in effect on the date hereof; provided that, a person shall be deemed to be the beneficial owner of, and to have beneficial ownership of, TetriDyn Stock or OTE Stock, as the case may be, that such person or any affiliate of such person has the right to acquire (whether such right is exercisable immediately or only after the passage of time) pursuant to any agreement, arrangement, or understanding or upon the exercise of conversion rights, exchange rights, warrants or options, or otherwise;

(c)           the term “day” means any calendar day, and the term “business day” means any day other than a day on which banks in the state of Delaware are authorized or obligated to be closed;

(d)           the term “control” (including the terms “controlled,” “controlled by,” and “under common control with”) means the possession, directly or indirectly or as trustee or executor, of the power to direct or cause the direction of the management or policies of a person, whether through the ownership of stock or as trustee or executor, by contract or credit arrangement, or otherwise;

(e)           the terms “hazardous waste,” “hazardous substance,” “disposal,” “release,” and “threatened release,” as used in this Agreement, shall have the same meanings set forth in the Comprehensive Environmental Response, Compensation, and Liability Act of 1980, as amended, 42 U.S.C. Section 9601, et seq., the Superfund Amendments and Reauthorization Act of 1986, Pub. L. no. 99-499, the Hazardous Materials Transportation Act, 49 U.S.C. Section 1801, et seq., the Resource Conservation and Recovery Act, 49 U.S.C. Section 6901, et seq., or other applicable state or federal Laws, rules, or regulations adopted pursuant to any of the foregoing.

(f)           the terms “knowledge” or “known” shall mean, respecting any matter in question, if an executive officer or equivalent person of TetriDyn or OTE, as the case may be, has actual knowledge of such matter or should have known such matter after reasonable investigation;

(g)           the term “person” means an individual, corporation, partnership, limited liability company, association, trust, unincorporated organization, other entity, or group (as defined in Section 13(d) of the Exchange Act);

(h)           the terms “subsidiary” or “subsidiaries” of TetriDyn or OTE, means any corporation, partnership, limited liability company, joint venture, or other legal entity of which TetriDyn or OTE, as the case may be (either alone or through or together with any other subsidiary), owns, directly or indirectly, currently or in the past, 50% or more of the stock or other equity interests, the holders of which are generally entitled to vote for the election of the board of directors or other governing body of such corporation or other legal entity; and

(i)           the term “Taxes” shall mean all taxes, however, denominated, including any interest, penalties, or other additions to tax that may become payable in respect thereof, imposed by any federal, territorial, state, local, or foreign government or any agency or political subdivision of any such government, including, without limiting the generality of the foregoing, all income or profit taxes, payroll and employee withholding taxes, unemployment insurance, social security taxes, sales and use taxes, ad valorem taxes, excise taxes, franchise taxes, gross receipts taxes, business license taxes, occupation taxes, real and personal property taxes, stamp taxes, environmental taxes, transfer taxes, workers’ compensation, Pension Benefit Guaranty Corporation premiums and other governmental charges, and other obligations of the same or of a similar nature to any of the foregoing, required to be paid, withheld, or collected.

 

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Section 8.04                      Interpretation

The language in all parts of this Agreement shall be in all cases construed simply according to its fair meaning and not strictly for or against any Party.  Section headings contained in this Agreement are for reference purposes only and shall not affect the meaning or interpretation of this Agreement.  Except when the context clearly requires to the contrary:  (a) all references in this Agreement to designated “sections” are to the designated sections and other subdivisions of this Agreement; (b) instances of gender or entity-specific usage (e.g., “his,” “her,” “its,” or “individual”) shall not be interpreted to preclude the application of any provision of this Agreement to any individual of any gender or entity; (c) the word “or” shall not be applied in its exclusive sense, unless the context otherwise requires; (d) ”including” shall mean that the items listed are illustrative, without any implication that all or even most of the components are mentioned; (e) references to Laws, regulations, and other governmental rules (collectively, “rules”), as well as to contracts, agreements, and other instruments (collectively, “instruments”), shall mean such rules and instruments as in effect at the time of determination (taking into account any amendments thereto effective at such time without regard to whether such amendments were enacted or adopted after the effective date) and shall include all successor rules and instruments thereto; (f) references to “$,” “cash,” or “dollars” shall mean the lawful currency of the United States; (g) unless otherwise indicated, periods within which a payment is to be made or any other action is to be taken hereunder shall be calculated excluding the day on which the period commences and including the day on which the period ends; (h) references to “federal” shall be to Laws, agencies, or other attributes of the United States (and not to any state or locality thereof); (i) the meaning of the terms “domestic” and “foreign” shall be determined by reference to the United States; (j) if any day specified in this Agreement for any notice, action, or event is not a business day, then the due date for such notice, action, or event shall be extended to the next succeeding business day; (k) references to “days” shall mean calendar days; references to “business days” shall mean all days other than Saturdays, Sundays, and days that are legal holidays in the state of Delaware; (l) references to monthly or annual anniversaries shall be to the actual calendar months or years at issue (without taking into account the actual number of days in any such month or year); (m) days, business days, and times of day shall be determined by reference to local time in Delaware; (n) the English language version of this Agreement and all documents or instruments delivered by any Party hereto to the other shall govern all questions of interpretation relating to this Agreement, notwithstanding that this Agreement may have been translated into, and executed in, other languages; (o) whenever in this Agreement a person or group is permitted or required to make a decision in its “discretion” or under a grant of similar authority or latitude, such person or group shall be entitled to consider only such interests and factors as it deems appropriate, in the exercise of reasonable discretion, exercised in good faith; and (p) whenever in this Agreement a person or group is permitted or required to make a decision in its “good faith” or under another express standard, the person shall act under such express standard and shall not be subject to any other or different standard imposed by this Agreement or other applicable law.

Section 8.05                      Entire Agreement

This Agreement (together with any Exhibits) constitutes the entire agreement of the Parties and supersedes all prior negotiations, courses of dealing, agreements, undertakings, and understandings, both written and oral, between the Parties respecting the subject matter hereof.

Section 8.06                      Assignment

This Agreement shall not be assigned by agreement, operation of law, or otherwise.

Section 8.07                      Parties in Interest

This Agreement shall be binding upon and inure solely to the benefit of the Parties, and nothing in this Agreement, express or implied, is intended to or shall confer upon any other person any right, benefit, or remedy of any nature whatsoever under or by reason of this Agreement.

Section 8.08                      Failure or Indulgence Not Waiver; Remedies Cumulative

No failure or delay on the part of any Party in the exercise of any right hereunder shall impair such right or be construed to be a waiver of, or acquiescence in, any breach of any representation, warranty, or agreement herein, nor shall any single or partial exercise of any such right preclude other or further exercise thereof or of any other right.  All rights and remedies existing under this Agreement are cumulative to, and not exclusive of, any rights or remedies otherwise available.

 

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Section 8.09                      Governing Law

This Agreement shall be governed by, enforced, and construed under and in accordance with the Laws of the United States of America and, respecting matters of state law, with the Laws of:

(a)           the state of Delaware as applicable to OTE and MergerCo. respecting matters governing corporations organized under the Laws of such state;

(b)           the state of Nevada as applicable to TetriDyn respecting matters governing corporations organized under the Laws of such state; and

(c)           otherwise, the Laws of the state of Delaware.

In each case without giving effect to any choice or conflict of Law provision or rule (whether of the state of the particular state or any other jurisdiction) that would cause the application of the laws of any jurisdiction other than the state specified.

Section 8.10                      Counterparts

This Agreement may be executed in multiple counterparts, and by the Parties in separate counterparts, each of which when executed shall be deemed to be an original but all of which taken together shall constitute one and the same agreement.

IN WITNESS WHEREOF, the Parties hereto have caused this Agreement to be executed as of the date first written above by their respective officers, thereunto duly authorized.

 

	 	TETRIDYN SOLUTIONS, INC. 

By: /s/ Antoinette Knapp Hempstead

Antoinette Knapp Hempstead

President

 

 

OCEAN THERMAL ENERGY CORPORATION

By: /s/ Jeremy P. Feakins

Jeremy P. Feakins

President

 

37Exhibit 4.9 

 

EXECUTION VERSION

 

 

 

 

FACILITY AGREEMENT

 

 

 

 

DATED 27 February 2015

 

 

U.S.$3,935,000,000

 

 

REVOLVING CREDIT FACILITY

 

for

 

VODAFONE GROUP PLC

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

ALLEN & OVERY LLP

 

LONDON

 

 

CONTENTS

 

	
Clause
    	
Page
    
	
 
    	
 
    	
 
    
	
1.
    	
Interpretation
    	
4
    
	
2.
    	
The Facilities
    	
34
    
	
3.
    	
Purpose
    	
39
    
	
4.
    	
Conditions Precedent
    	
39
    
	
5.
    	
Advances
    	
40
    
	
6.
    	
Extension Options
    	
42
    
	
7.
    	
Repayment
    	
43
    
	
8.
    	
Prepayment and   Cancellation
    	
45
    
	
9.
    	
Interest
    	
47
    
	
10.
    	
Payments
    	
50
    
	
11.
    	
Taxes
    	
53
    
	
12.
    	
Market Disruption
    	
59
    
	
13.
    	
Increased Costs
    	
60
    
	
14.
    	
Illegality and   Mitigation
    	
62
    
	
15.
    	
Guarantee
    	
63
    
	
16.
    	
Representations and   Warranties
    	
67
    
	
17.
    	
Undertakings
    	
71
    
	
18.
    	
Financial Covenant
    	
76
    
	
19.
    	
Default
    	
77
    
	
20.
    	
The Agents, the   Arrangers and the Reference Banks
    	
80
    
	
21.
    	
Fees
    	
87
    
	
22.
    	
Expenses
    	
88
    
	
23.
    	
Stamp Duties
    	
88
    
	
24.
    	
Indemnities
    	
89
    
	
25.
    	
Evidence and   Calculations
    	
90
    
	
26.
    	
Amendments and Waivers
    	
90
    
	
27.
    	
Changes to the Parties
    	
93
    
	
28.
    	
Disclosure of   Information
    	
102
    
	
29.
    	
Set-off
    	
105
    
	
30.
    	
Pro Rata Sharing
    	
106
    
	
31.
    	
Severability
    	
107
    
	
32.
    	
Counterparts
    	
107
    
	
33.
    	
Notices
    	
107
    
	
34.
    	
Language
    	
109
    
	
35.
    	
Jurisdiction
    	
109
    
	
36.
    	
Governing Law
    	
111
    
	
37.
    	
USA Patriot Act
    	
111
    
	
38.
    	
Waiver of Trial by Jury
    	
111
    

 

 

	
Schedule
    	
Page
    
	
 
    	
 
    
	
1.
    	
Lenders and Commitments
    	
112
    
	
 
    	
Part 1
    	
Lenders and Commitments
    	
112
    
	
 
    	
Part 2
    	
Swingline Lenders and   Swingline Commitments
    	
114
    
	
 
    	
Part 3
    	
Mandated Lead Arrangers
    	
116
    
	
 
    	
Part 4
    	
Co-Arrangers
    	
117
    
	
2.
    	
Conditions Precedent   Documents
    	
118
    
	
 
    	
Part 1
    	
To be Delivered before   the First Advance
    	
118
    
	
 
    	
Part 2
    	
To be Delivered by an   Additional Guarantor
    	
119
    
	
 
    	
Part 3
    	
To be Delivered by an   Additional Borrower
    	
121
    
	
3.
    	
Form of Request
    	
122
    
	
4.
    	
Forms of Accession   Documents
    	
123
    
	
 
    	
Part 1
    	
Novation Certificate
    	
123
    
	
 
    	
Part 2
    	
Guarantor Accession   Agreement
    	
125
    
	
 
    	
Part 3
    	
Borrower Accession   Agreement
    	
126
    
	
 
    	
Part 4
    	
Lender Accession Agreement
    	
127
    
	
5.
    	
Form of   Confidentiality Undertaking from New Lender
    	
128
    
	
6.
    	
Form of Additional   Lender’s Fee Letter
    	
131
    
	
7.
    	
Form of Increase   Confirmation
    	
133
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
Signatories
    	
135
    

 

 

THIS AGREEMENT is dated 27 February 2015 and made BETWEEN:

 

(1)                              VODAFONE GROUP PLC (registered number 1833679) as borrower (“Vodafone”);

 

(2)                              THE FINANCIAL INSTITUTIONS listed in Part 3 of Schedule 1 as Mandated Lead Arrangers;

 

(3)                              THE FINANCIAL INSTITUTIONS listed in Part 4 of Schedule 1 as Co Arrangers;

 

(4)                              THE FINANCIAL INSTITUTIONS listed in Part 1 of Schedule 1 as Original Lenders;

 

(5)                              THE ROYAL BANK OF SCOTLAND PLC as agent (in this capacity the “Agent”); and

 

(6)                              THE ROYAL BANK OF SCOTLAND PLC (CONNECTICUT BRANCH) as U.S. swingline agent (in this capacity the “U.S. Swingline Agent”).

 

IT IS AGREED as follows:

 

1.                                    INTERPRETATION

 

1.1                            Definitions

 

In this Agreement:

 

“Acceptable bank”

 

means a bank or financial institution which has a rating for its long-term unsecured and non-credit enhanced debt obligations of A- or higher by S&P or Fitch or A3 or higher by Moody’s or a comparable rating from an internationally recognised credit rating agency.

 

“Acquisition”

 

means the acquisition of any interest in the share capital (or equivalent) or in the business or undertaking of any company or other person (including, without limitation, any partnership or joint venture).

 

“Additional Borrower”

 

means any member of the Restricted Group which becomes an additional borrower pursuant to Clause 27.8 (Additional Borrowers) and which has not been released as a borrower in accordance with Clause 27.9 (Removal of Borrowers).

 

“Additional Guarantor”

 

means any member of the Consolidated Group which at such time has become a Guarantor in accordance with Clause 27.7 (Additional Guarantors) and has not been released in accordance with Clause 15.9 (Removal of Guarantors).

 

“Additional Lender”

 

means a financial institution or other entity which becomes an additional lender pursuant to Clause 2.8 (Additional Lenders) or a transferee, successor or permitted assignee of such financial institution or other entity which is for the time being participating in the Facility.

 

4

 

“Adjusted Group Operating Cash Flow”

 

means, without double counting, in relation to any period, a sum equal to the Consolidated Group’s total operating profit or loss for continuing operations, acquisitions (as a component of continuing operations) and discontinued operations before taxation, interest and after:

 

(a)                               adding depreciation;

 

(b)                              adding amortisation;

 

(c)                               deducting the profit or adding any loss on exceptional items which are included in the foregoing;

 

(d)                              deducting any gain or adding any loss on disposal of tangible or intangible fixed assets;

 

(e)                               adjusting for movements in working capital (being movements in stock, creditors, provision, and debtors);

 

(f)                                adding dividends or proceeds of a similar nature received from any entity not in the Consolidated Group; and

 

(g)                               excluding exceptional items,

 

and for the avoidance of doubt excluding (other than as set out in paragraph (f) above) the results of any entity not in the Consolidated Group.

 

“Advance”

 

means a Revolving Credit Advance or a Swingline Advance.

 

“Affected Lender”

 

has the meaning given to it in Clause 2.2(c) (Overall facility limits).

 

“Affiliate”

 

means, in relation to a person, a Subsidiary or a Holding Company of that person and any other Subsidiary of that Holding Company.

 

“Agent’s Spot Rate of Exchange”

 

means the spot rate of exchange as determined by the Agent for the purchase of the relevant Optional Currency in the London foreign exchange market with U.S. Dollars at or about 11.00 a.m. on a particular day.

 

“Agreed Percentage”

 

means in relation to a Lender and a Swingline Advance, the amount of its Revolving Credit Commitment expressed as a percentage of the Total Commitments.

 

“All Quoting Credit Rating Agencies”

 

has the meaning given to it in Clause 9.5(a).

 

5

 

“Arranger”

 

means a financial institution or other entity listed in Part 3 or Part 4 of Schedule 1.

 

“Asset Disposal”

 

means any sale, transfer, grant, lease or other disposal of an asset (which for the avoidance of doubt does not include returns to shareholders) by any member of the Controlled Group to a person outside the Controlled Group made after the Signing Date.

 

“Available Cash”

 

means:

 

(a)                               cash in hand and cash in deposits repayable on demand with any Qualifying Financial Institution;

 

(b)                              the marked to market position of in the money derivative contracts; and

 

(c)                               Liquid Resources,

 

to the extent denominated in any freely convertible and transferable currencies, beneficially owned and unencumbered by any Security Interests other than Permitted Security Interests.

 

“Available Commitment”

 

means a Lender’s Commitment minus:

 

(a)                               the amount of its participation in any outstanding Advances (other than, in relation to any proposed Advance, that Lender’s participation in any Advances that are due to be repaid or prepaid on or before the proposed Drawdown Date); and

 

(b)                              in relation to any proposed Advance, the amount of its participation in any Advances that are due to be made on or before the proposed Drawdown Date.

 

“Availability Period”

 

means, subject to Clause 6 (Extension Option), the period from the Signing Date up to and including the date which is five years after the Signing Date or, if that day is not a Business Day, the preceding Business Day.

 

“Back to Back Loan”

 

means any Financial Indebtedness made available to a member of the Restricted Group to the extent that the economic exposure of the creditor in respect of that Financial Indebtedness (taking any related transactions together) is reduced by reason of that creditor:

 

(a)                               having recourse directly or indirectly to a deposit of cash or cash equivalent investments beneficially owned by any member of the Restricted Group placed, as part of a related transaction, with that creditor (or an Affiliate of that creditor) or a financial institution approved by that creditor; or

 

(b)                              having granted a funded sub-participation or similar arrangement to a member of the Restricted Group.

 

6

 

“Base Currency”

 

means U.S. Dollars.

 

“Basel III”

 

means:

 

(a)                               the agreements on capital requirements, a leverage ratio and liquidity standards contained in “Basel III: A global regulatory framework for more resilient banks and banking systems”, “Basel III: International framework for liquidity risk measurement, standards and monitoring” and “Guidance for national authorities operating the countercyclical capital buffer” published by the Basel Committee on Banking Supervision in December 2010, each as amended, supplemented or restated;

 

(b)                              the rules for global systemically important banks contained in “Global systemically important banks: assessment methodology and the additional loss absorbency requirement- Rules text” published by the Basel Committee on Banking Supervision in November 2011, as amended, supplemented or restated; and

 

(c)                               any further guidance or standards published by the Basel Committee on Banking Supervision relating to “Basel III”.

 

“Basel III Cost”

 

means any increased cost attributable to the introduction, implementation or application of or compliance with or change in Basel III or CRD IV or any other law or regulation which implements Basel III or CRD IV.

 

“Borrower”

 

means Vodafone or an Additional Borrower.

 

“Borrower Accession Agreement”

 

means an agreement substantially in the form of Part 3 of Schedule 4 or with such amendments as the Agent may approve (such approval not to be unreasonably withheld or delayed) or may reasonably require.

 

“Business Day”

 

means a day (other than a Saturday or Sunday) on which banks and the interbank and foreign exchange markets are open for general business in London and:

 

(a)                               if a payment is required in U.S. Dollars, New York; or

 

(b)                              if a payment is required in euro, a TARGET Day; or

 

(c)                               if a payment is required in any other currency, the principal financial centre of the country of that currency.

 

“Change of Control”

 

has the meaning given to it in Clause 8.4 (Change of Control).

 

7

 

“Code”

 

means the US Internal Revenue Code of 1986.

 

“Combined Commitments”

 

means the aggregate of the Total Commitments under this Agreement and the Total Commitments under and as defined in the 2019 Facility.

 

“Combined Swingline Commitments”

 

means the aggregate of the Swingline Total Commitments under this Agreement and the Swingline Total Commitments under and as defined in the 2019 Facility.

 

“Commitment”

 

means a Revolving Credit Commitment or a Swingline Commitment, in each case to the extent not transferred, cancelled or reduced under or in accordance with this Agreement.

 

“Consolidated Group”

 

means Vodafone (or, following a Hive Up, NewTopco), its IFRS Consolidated Subsidiaries and Joint Ventures.

 

“Contractual Currency”

 

has the meaning given to it in Clause 24.1(a) (Currency indemnity).

 

“Controlled Group”

 

means Vodafone (or, following a Hive Up, NewTopco) and its Controlled Subsidiaries.

 

“Controlled Subsidiaries”

 

means, those Subsidiaries of Vodafone (or, following a Hive Up, NewTopco) in which Vodafone or NewTopco, as the case may be, controls more than 50% of such Subsidiaries voting rights and has recourse to the cash flows of the Subsidiary. Until the first certificate is given by Vodafone to the Agent in accordance with Clause 17.2(c) (Financial information) (in respect of the financial year ended 31 March 2015), the Controlled Subsidiaries include, without limitation, the following operating Subsidiaries: Vodafone AG & Co.; Vodafone Romania S.A.; Vodafone Czech Republic A.S.; Vodafone Albania Sh.A; Vodafone GmbH; Vodafone Egypt Telecommunications S.A.E; Vodafone España S.A.; Vodafone India Limited; Vodafone Hungary Mobile Telecommunications Ltd; Vodafone Ireland Limited; Vodafone Libertel B.V.; Vodafone Limited; Vodafone Malta Limited; Vodafone New Zealand Limited; Vodafone Omnitel N.V.; Vodafone-Panafon Hellenic Telecommunications Company S.A.; Vodafone Telekomunikasyon A.S., Vodafone Portugal-Comunicações Pessoais S.A., Vodacom Group Limited; Ghana Telecommunication Company Limited; and Cable & Wireless Worldwide Plc.

 

“Controlled USA Group”

 

means all members of a controlled group of corporations and all trades or businesses (whether or not incorporated) under common control which, together with any U.S. Obligor, are treated as a single employer under Section 414(b) or (c) of the Code.

 

8

 

“Core Jurisdictions”

 

are member states of the European Union as at 1 January 2015 (being Austria, Belgium, Bulgaria, Cyprus, Czech Republic, Croatia, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Ireland, Italy, Latvia, Lithuania, Luxembourg, Malta, Netherlands, Poland, Portugal, Romania, Slovakia, Slovenia, Spain, Sweden and the UK), Japan, United States, Australia, New Zealand, Canada and Switzerland and any other states which become members of the European Union after 1 January 2015 provided that Vodafone has notified the Agent in writing of its agreement to their inclusion in this definition of Core Jurisdictions.

 

“CRD IV”

 

means (A) Regulation (EU) No 575/2013 of the European Parliament and of the Council of 26 June 2013 on prudential requirements for credit institutions and investment firms and (B) Directive 2013/36/EU of the European Parliament and of the Council of 26 June 2013 on access to the activity of credit institutions and the prudential supervision of credit institutions and investment firms.

 

“CTA”

 

means the Corporation Tax Act 2009.

 

“Credit Rating Agency”

 

has the meaning given to it in Clause 9.5 (Margin).

 

“Default”

 

means (a) an Event of Default or (b) an event which, with the expiry of any grace period or giving of any notice specified in Clause 19.2 (Non-payment), 19.3 (Breach of other obligations), 19.5 (Cross default), 19.6 (Winding up), 19.8 (Enforcement proceedings) or 19.10 (Similar proceedings) would constitute an Event of Default.

 

“Default Margin”

 

has the meaning given to it in Clause 9.3 (Default interest).

 

“Default Rate”

 

has the meaning given to it in Clause 9.3 (Default interest).

 

“Defaulting Lender”

 

means any Lender:

 

(a)                               which has failed to make its participation in an Advance available or has notified the Agent that it will not make its participation in an Advance available by the Drawdown Date of that Advance in accordance with Clause 5.6 (Payment of proceeds);

 

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

 

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

 

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

 

9

 

(i)                                  its failure to pay is caused by:

 

(A)                           administrative or technical error and payment is made within three Business Days of its due date; or

 

(B)                            a Disruption Event and payment is made within eight Business Days of its due date; or

 

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

 

“Designated Term”

 

has the meaning given to it in Clause 9.3(a)(ii) (Default interest).

 

“Discharged Obligations”

 

has the meaning given to it in Clause 27.4(c)(i) (Procedure for novations).

 

“Discharged Rights”

 

has the meaning given to it in Clause 27.4(c)(iii) (Procedure for novations).

 

“Disruption Event”

 

means either or both of:

 

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

 

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

 

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

 

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

 

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

 

“Drawdown Date”

 

means the date for the making of an Advance.

 

“ERISA”

 

means the U.S. Employee Retirement Income Security Act of 1974, as amended (or any successor legislation thereto), and any rule or regulation issued thereunder from time to time in effect.

 

10

 

“EURIBOR”

 

means in relation to any Advance or unpaid sum in euro:

 

(a)                               the applicable Screen Rate;

 

(b)                              if no Screen Rate is available for the Required Period of that Advance or unpaid sum, the Interpolated Screen Rate for that Advance or unpaid sum; or

 

(c)                               if no Screen Rate is available for the Required Period of that Advance or unpaid sum and it is not possible to calculate an Interpolated Screen Rate for that Advance or unpaid sum, the Reference Bank Rate

 

as of, in the case of paragraphs (a) and (c) above, 11.00 a.m. (Brussels time) on the Rate Fixing Day for euro and (in each case) for a period in length equal to the Required Period, and for the purposes of this definition and the definition of “Interpolated Screen Rate”, “Required Period” means the Term of such Advance for Revolving Credit Advances, or the period in respect of which EURIBOR falls to be determined in relation to any unpaid sum.

 

“Event of Default”

 

means an event specified as such in Clause 19 (Default).

 

“Existing Commitment”

 

has the meaning given to it in Clause 17.8(a)(i) (Priority borrowing).

 

“Existing Lender”

 

has the meaning given to it in Clause 27.2(a) (Transfers by Lenders).

 

“Existing Parties”

 

has the meaning given to it in Clause 27.4(c)(i) (Procedure for novations).

 

“Facility”

 

means any of the facilities to draw Revolving Credit Advances, or Swingline Advances referred to in Clause 2.1 (Facilities).

 

“Facility Office”

 

means the office(s) notified by a Lender to the Agent:

 

(a)                               on or before the date it becomes a Lender; or

 

(b)                              by not less than five Business Days’ notice,

 

as the office(s) through which it will perform all or any of its obligations under this Agreement.

 

“FATCA”

 

means:

 

11

 

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

 

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

 

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

 

“FATCA Application Date” means:

 

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

 

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

 

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

 

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

 

“FATCA Deduction”

 

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

 

“FATCA Exempt Party”

 

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

 

“Fee Letters”

 

means each letter:

 

(a)                               dated on or about the date of this Agreement between the Agent and Vodafone; and

 

(b)                              dated on or about the date of this Agreement between the Original Lenders as at the Signing Date and Vodafone; and

 

(c)                               (if applicable) entered into between an Additional Lender and Vodafone substantially in the form of Schedule 6,

 

in each case setting out the amount of various fees referred to in Clause 21.3 (Agent’s fee) or 21.4 (Front-end fees).

 

“Federal Funds Rate”

 

12

 

means, on any day:

 

(a)                               the rate per annum determined by the U.S. Swingline Agent to be the Federal Funds Rate (as published by the Federal Reserve Bank of New York) at or about 1.00 p.m. (New York City time) on that day; or

 

(b)                              if such rate is not published at such time, the rate for such day will be the arithmetic mean as determined by the U.S. Swingline Agent of the rates for the last transaction in overnight Federal funds arranged prior to noon (New York City time) on that day by each of three leading brokers of Federal funds transactions in New York City selected by the U.S. Swingline Agent.

 

“Final Maturity Date”

 

means the last day of the Availability Period.

 

“Finance Document”

 

means this Agreement, each Fee Letter, Novation Certificate, Borrower Accession Agreement, Guarantor Accession Agreement and Increase Confirmation and any other document agreed in writing as such by the Agent and Vodafone.

 

“Finance Party”

 

means an Arranger, a Lender, the Agent or the U.S. Swingline Agent.

 

“Financial Indebtedness”

 

means any indebtedness in respect of:

 

(a)                               moneys borrowed or raised by way of loan or redeemable preference shares or in the form of any debenture, bond, note, loan stock, commercial paper or similar instrument;

 

(b)                              any acceptance credit, bill-discounting, note purchase or documentary credit facility;

 

(c)                               any finance lease;

 

(d)                              any receivables purchase, factoring or discounting arrangement under which there is recourse in whole or in part to any member of the relevant group;

 

(e)                               any other transaction having the commercial effect of a borrowing; and

 

(f)                                any guarantees or other legally binding assurance against financial loss in respect of the indebtedness of any person arising under an obligation falling within (a) to (e) above (but, for the avoidance of doubt, excluding any guarantees in respect of indebtedness falling within (i) to (v) below),

 

but without double counting and excluding (i) preference shares which are not accounted for as indebtedness under IFRS GAAP, (ii) any convertible or exchangeable debt which must or, at the option of the issuer, may be converted or exchanged without condition (other than the availability of sufficient authorised share capital of the issuer), prior to or upon the date any amount of principal would otherwise fall due in respect of that debt, into equity share capital or preference shares, which in each case are not redeemable on or before the Final Maturity

 

13

 

Date, (iii) deferred consideration in respect of the cost of Acquisitions, (iv) obligations of any member of the relevant group arising under any form of exchangeable, convertible, option or other similar instrument issued by that member of the relevant group in connection with a transaction the commercial effect of which is to effect the disposal by that member of the relevant group of shares or partnership or other ownership interests in any other person or entity (whether or not having a separate legal identity), provided that any such instrument may not, on or prior to the Final Maturity Date, be converted (whether by acceleration, maturity or otherwise) into cash or any other instrument constituting or evidencing Financial Indebtedness and (v) for the avoidance of doubt, derivatives primarily entered into to manage currency, credit or interest rate risks or to assist in purchasing or selling shares.

 

“Fitch”

 

means Fitch Investors Services Inc.

 

“Funding Rate”

 

means any rate notified to the Agent by a Lender pursuant to paragraph (b)(iii) of Clause 12.2 (Alternative rates).

 

“Guarantor”

 

means each of:

 

(a)                               Vodafone; and

 

(b)                              each Additional Guarantor.

 

“Guarantor Accession Agreement”

 

means a deed substantially in the form of Part 2 of Schedule 4 or with such amendments as the Agent may approve (such approval not to be unreasonably withheld or delayed) or may reasonably require.

 

“Hive Up”

 

means a reorganisation by way of a scheme of arrangement (other than in an insolvency) or otherwise under which Vodafone becomes a Subsidiary of NewTopco, NewTopco controls (directly or indirectly) all of the voting rights in Vodafone (other than any voting rights in Vodafone in respect of the 50,000 7 per cent. fixed rate shares issued in 1999 or any other voting rights in Vodafone held by holders of a class of capital issued by Vodafone, where such voting rights relate only to any variation in the rights attaching to that class of capital issued by Vodafone) and NewTopco becomes the listed ultimate Holding Company of the Consolidated Group.

 

“Holding Company”

 

means in relation to a person, an entity of which that person is a Subsidiary.

 

“HMRC”

 

means HM Revenue & Customs.

 

“IFRS Consolidated Subsidiaries”

 

14

 

means those Subsidiaries of Vodafone (or, following a Hive Up, NewTopco) which would be required to be fully consolidated (which excludes proportionate consolidation) in the consolidated accounts of Vodafone (or, following a Hive Up, NewTopco) in accordance with IFRS GAAP.

 

“IFRS GAAP”

 

means the generally accepted accounting principles applied in the preparation of the IFRS consolidated audited accounts of Vodafone for the year ended 31 March 2014 or later audited accounts, if notified by Vodafone in writing to the Agent within three months (or such longer period as may be agreed by the Agent) of publication of such audited accounts.

 

“Impaired Agent”

 

means the Agent or the U.S. Swingline Agent at any time when:

 

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

 

(b)                              the Agent or the U.S. Swingline Agent otherwise rescinds or repudiates a Finance Document;

 

(c)                               (if the Agent or the U.S. Swingline Agent is also a Lender) it is a Defaulting Lender under paragraph (a) or (b) of the definition of Defaulting Lender; or

 

(d)                              an Insolvency Event has occurred and is continuing with respect to the Agent or the U.S. Swingline Agent;

 

Unless, in the case of paragraph (a) above:

 

(i)                                  its failure to pay is caused by:

 

(A)                           administrative or technical error and payment is made within three Business Days of its due date; or

 

(B)                            a Disruption Event and payment is made within eight Business Days of its due date; or

 

(ii)                              the Agent or the U.S. Swingline Agent is disputing in good faith whether it is contractually obliged to make the payment in question.

 

“Increase Confirmation”

 

means a confirmation substantially in the form set out in Schedule 7 (Form of Increase Confirmation).

 

“Increase Lender”

 

has the meaning given to that term in Clause 2.3 (Increase).

 

“increased cost”

 

has the meaning given to that term in Clause 13.1 (Increased costs).

 

“Insolvency Event”

 

15

 

in relation to a Finance Party, means that the Finance Party:

 

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

 

(b)                              becomes insolvent or is unable to pay its debts or fails or admits in writing its inability to pay its debts as they become due in each case under the laws of any relevant jurisdiction applicable to that Finance Party;

 

(c)                               makes a general assignment, arrangement or composition with or for the benefit of its creditors;

 

(d)                              has made against it a judgment of insolvency or bankruptcy or any other relief under any bankruptcy or insolvency law or other similar law affecting creditors’ rights, or an order is made for its winding-up or liquidation;

 

(e)                               has an order made against it for a bank insolvency pursuant to Part 2 of the Banking Act 2009 or a bank administration pursuant to Part 3 of the Banking Act 2009;

 

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

 

(g)                               seeks or becomes subject to the appointment of an administrator, provisional liquidator, conservator, receiver, trustee, custodian or other similar official for it or for all or substantially all its assets other than by way of Undisclosed Administration;

 

(h)                              has a secured party take possession of all or substantially all its assets or has a distress, execution, attachment, sequestration or other legal process levied, enforced or sued on or against all or substantially all its assets and such secured party maintains possession, or any such process is not dismissed, discharged, stayed or restrained, in each case within 30 days thereafter; or

 

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

 

“Intermediate Holding Company”

 

means, in relation to Vodafone, an entity (other than NewTopco) which is a Subsidiary of NewTopco and of which Vodafone is a Subsidiary.

 

“Interpolated Screen Rate”

 

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

 

(a)                               the applicable Screen Rate for the longest period (for which that Screen Rate is available) which is less than the Required Period of that Advance or unpaid sum; and

 

(b)                              the applicable Screen Rate for the shortest period (for which that Screen Rate is available) which exceeds the Required Period of that Advance or unpaid sum,

 

each as of 11.00 a.m. (London time) in the case of LIBOR and 11.00 a.m. (Brussels time) in the case of EURIBOR on the Rate Fixing Day for the currency of that Advance.

 

16

 

“ITA 2007”

 

means the Income Tax Act 2007.

 

“Joint Venture”

 

means at any time an entity (which is not an IFRS Consolidated Subsidiary) in which any member of the Consolidated Group holds a long term interest and shares control under a contractual arrangement where each venturer has a veto over policy decisions and which is, or will be, accounted for on a proportionate basis in the consolidated accounts of Vodafone (or, following a Hive Up, NewTopco) for that time, and shall exclude any entity which is accounted for on an equity basis in those accounts (in each case, in accordance with the generally applicable accounting principles applied to those accounts).

 

“Lender”

 

means each Original Lender, each Additional Lender (if any) and each Increase Lender (if any).

 

“Lender Accession Agreement”

 

means an agreement substantially in the same form of Part 4 of Schedule 4 or with such amendments as the Agent may approve or may reasonably require.

 

“LIBOR”

 

means in relation to any Advance or unpaid sum in a currency other than euro:

 

(a)                               the applicable Screen Rate;

 

(b)                              if no Screen Rate is available for the Required Period of that Advance or unpaid sum, the Interpolated Screen Rate for that Advance or unpaid sum; or

 

(c)                               if no Screen Rate is available for the currency of that Advance or the Required Period of that Advance or unpaid sum and it is not possible to calculate an Interpolated Screen Rate for that Advance or unpaid sum, the Reference Bank Rate,

 

as of, in the case of paragraphs (a) and (c) above, 11.00 a.m. (London time) on the Rate Fixing Day for the currency of that Advance or unpaid sum and (in each case) for a period equal to the Required Period and for the purposes of this definition and the definition of “Interpolated Screen Rate”, “Required Period” means the Term of such Advance for Revolving Credit Advances or the period in respect of which LIBOR falls to be determined in relation to any unpaid sum.

 

“Liquid Resources”

 

means a current asset investment held as a readily disposable store of value which can be disposed of without curtailing or disrupting the business of the disposer and which is either:

 

(a)                               readily convertible into a known amount of cash at or close to its carrying value; or

 

(b)                              traded in an active market.

 

“Long Term Credit Rating Assigned to Vodafone”

 

17

 

has the meaning given to it in Clause 9.5(d) (Margin).

 

“Majority Lenders”

 

means, at any time:

 

(a)                               Lenders whose Revolving Credit Commitments aggregate more than 60 per cent. of the Total Commitments; or

 

(b)                              if the Total Commitments have been reduced to zero, Lenders whose Revolving Credit Commitments aggregated more than 60 per cent. of the Total Commitments immediately before the reduction.

 

“Margin”

 

in relation to an Advance at any time, means the percentage rate per annum determined to be the Margin applicable to that Advance in accordance with Clause 9.5 (Margin).

 

“Maturity Date”

 

means the last day of the Term of:

 

(a)                               a Revolving Credit Advance; or

 

(b)                              a Swingline Advance.

 

“Moody’s”

 

means Moody’s Investors’ Service, Inc.

 

“Multi-employer Plan”

 

means a “multi-employer plan” as defined in Section 4001(a)(3) of ERISA to which any U.S. Obligor or any member of the Controlled USA Group has an obligation to contribute.

 

“Net Debt”

 

means at any time, Total Gross Borrowings less Available Cash, both at that time. Net Debt for any Ratio Period will be calculated as the aggregate of Net Debt outstanding on the last day of each month during the relevant Ratio Period (as shown in Vodafone’s, or following a Hive Up, NewTopco’s, consolidated management accounts prepared at the end of each month during the relevant Ratio Period) divided by the number of months during the relevant Ratio Period.

 

“NewTopco”

 

means a company used for the purposes of a Hive Up.

 

“New Lender”

 

has the meaning given to it in Clause 27.2(a) (Transfers by Lenders).

 

18

 

“New York Business Day”

 

means a day (other than a Saturday or Sunday) on which banks are open for business in New York.

 

“Novation Certificate”

 

has the meaning given to it in Clause 27.4(a)(i) (Procedure for novations).

 

“Obligor”

 

means each Borrower and each Guarantor.

 

“Operating Cash Flow”

 

means, without double counting, total operating profit or loss for continuing operations before taxation, interest and after (i) adding depreciation, (ii) adding amortisation, (iii) deducting the profit or adding the loss on exceptional items which are included in the foregoing, (iv) deducting any gain or adding any loss on disposal of tangible or intangible fixed assets, (v) adjusting for movements in working capital (being movements in stock, creditors, provisions and debtors) and (vi) excluding exceptional items.

 

“Optional Currency”

 

means, in relation to any Advance or proposed Advance, a currency (other than the Base Currency) which complies with the conditions set out in Clause 4.3 (Conditions relating to Optional Currencies).

 

“Original Dollar Amount”

 

means:

 

(a)                               the principal amount of an Advance denominated in U.S. Dollars; or

 

(b)                              the principal amount of an Advance denominated in any other currency, translated into U.S. Dollars on the basis of the Agent’s Spot Rate of Exchange on the date of receipt by the Agent of the Request for that Advance.

 

“Original Lender”

 

means a financial institution or other entity listed in Part 1 or Part 2 of Schedule 1 or a transferee, successor or permitted assignee of such financial institution or other entity which is for the time being participating in the Facility.

 

“Overdue Amount”

 

has the meaning given to it in Clause 9.3(a) (Default interest).

 

“Participating Member State”

 

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

 

“Party”

 

19

 

means a party to this Agreement.

 

“PBGC”

 

means the Pension Benefit Guaranty Corporation referred to and defined in ERISA, or any successor.

 

“Permitted Security Interest”

 

means:

 

(a)                               any Security Interest arising out of retention of title provisions or created or subsisting over documents of title, insurance policies (including any export credit agencies’ agreements) and sale contracts in relation to commercial goods in each case created or made in the ordinary course of business to secure the purchase price of such goods or loans to finance such purchase price; or

 

(b)                              any Security Interest over any assets acquired by a member of the Restricted Group after 1 February 2015 (and/or over the assets of any person that becomes a member of the Restricted Group after 1 February 2015) provided that:

 

(i)                                  any such Security Interest is in existence before such acquisition or before such person becomes a member of the Restricted Group and is not created in contemplation of such acquisition or such person becoming a member of the Restricted Group; and

 

(ii)                              to the extent that the aggregate principal amount secured by such Security Interest upon such acquisition or such person becoming a member of the Restricted Group thereafter exceeds (measured in the same currency) the amount available to be drawn (assuming all drawdown conditions will be met) under the relevant commitment existing at the time of such acquisition or such person becoming a member of the Restricted Group, such Security Interest shall not fall within this paragraph (b);

 

for the purposes of this paragraph (b) Restricted Group shall not include any companies which have become members of the Restricted Group due to the expansion of the definition of Core Jurisdiction to include any other states which become members of the European Union after 1 January 2015; or

 

(c)                               any Security Interest created for the purpose of securing obligations of Vodafone (or, following a Hive Up, NewTopco) or any member of the Restricted Group under any agreement (including, without limitation, any agreement under Section 106 of the Town and Country Planning Act 1990 or Section 111 of the Local Government Act 1972) entered into with a local or other public authority and related to the development or maintenance of property owned by Vodafone (or, following a Hive Up, NewTopco) or any member of the Restricted Group; or

 

(d)                              any Security Interest created on or subsisting over any asset held in Clearstream Banking, société anonyme or Euroclear Bank S.A./N.V. as operator of the Euroclear System, or any other securities depository or any clearing house pursuant to the standard terms and procedures of the relevant clearing house applicable in the normal course of trading; or

 

20

 

(e)          any Security Interest which arises in connection with any cash management, set-off or netting arrangements made between banks or financial institutions and any member(s) of the Restricted Group in the ordinary course of business; or

 

(f)                                any Security Interest created in favour of a plaintiff or defendant in any action of the court or tribunal before whom such action is brought as pre-judgment security for costs or expenses where any member of the Restricted Group is prosecuting or defending such action in the bona fide interest of the Controlled Group; or

 

(g)                               any Security Interest created pursuant to any order of attachment, distraint, garnishee order, arrestment, adjudication or injunction or interdict restraining disposal of assets or similar legal process arising in connection with pre-judgment court proceedings; or

 

(h)                              any Security Interest which arises by operation of law in the ordinary course of trading and securing an amount not more than 45 days overdue or which is being contested in good faith on the basis of favourable legal advice; or

 

(i)                                  any Security Interest over shares in entities which are not members of the Restricted Group which do not secure Financial Indebtedness of the Restricted Group (or over shares and/or other ownership interests in and/or loans to entities which are Project Finance Subsidiaries to secure Project Finance Indebtedness); or

 

(j)                                  to the extent they constitute Security Interests (or to the extent that the relevant transaction includes the creation of any Security Interest over the assets which are the subject of the finance lease), finance leases in respect of existing or future assets; or

 

(k)                              any Security Interest comprising a right of set-off which arises by agreement between parties providing mutual rights of set-off or operation of law or by agreement having substantially the same effect; or

 

(l)                                  any Security Interest for taxes, assessments or charges not yet due or that are being contested in good faith by appropriate proceedings and (unless the amount thereof is not material to the Consolidated Group’s financial condition) for which adequate reserves are being maintained (in accordance with generally accepted accounting principles); or

 

(m)                          deposits or pledges to secure obligations under workers’ compensation, social security or similar laws, or under unemployment insurance; or

 

(n)                              any Security Interest created with the prior written consent of the Majority Lenders; or

 

(o)                              any Security Interest over deposits of cash or cash equivalent investments securing (directly or indirectly) Financial Indebtedness under (i) finance or structured tax lease arrangements as described in paragraph (b) of Clause 17.8 (Priority borrowing) or (ii) Back to Back Loans; or

 

(p)                              any Security Interest securing Project Finance Indebtedness over the assets (or the income, cash flow or other proceeds deriving from the assets) which are the subject of that Project Finance Indebtedness; or

 

(q)          any Security Interest (a “Substitute Security Interest”) which replaces any other Security Interest permitted under paragraphs (a) to (p) above inclusive and which secures an amount not exceeding the principal amount secured by such permitted

 

21

 

Security Interest (or, in the case of paragraph (b) above, the amount available to be drawn, assuming all drawdown conditions will be met) at the time it is replaced together with any interest accruing on such amounts from the date such Substitute Security Interest is created or arises and any related fees or expenses provided that the existing Security Interest to be replaced is released and all amounts secured thereby are paid or otherwise discharged in full at or prior to the time of such Substitute Security Interest being created or arising; or

 

(r)                                 any Security Interest over the shares or other interests as described in paragraph (iv) of the last paragraph of the definition of Financial Indebtedness securing indebtedness of a kind referred to in that paragraph; or

 

(s)                                any Security Interest created (i) between Obligors (including by an Obligor to a member of the Restricted Group which concurrently becomes an Obligor) or (ii) by a member of the Restricted Group which is not an Obligor in favour of an Obligor or to another member of the Restricted Group; or

 

(t)                                  any Security Interest over Available Cash created in the ordinary course of business to secure obligations, liabilities or performance criteria in relation to any mobile telecommunications licence where such Security Interest is required to be in compliance with the requirements of the relevant telecommunications regulator or an associated governmental or regulatory body; or

 

(u)          any Security Interest over Available Cash created to defease (directly or indirectly) Financial Indebtedness in the form of debentures, bonds, notes, loan stock, or other similar instruments issued by a Controlled Subsidiary where (A) such Financial Indebtedness was either in existence at the Signing Date or (B) if the Subsidiary became a Controlled Subsidiary after the Signing Date such Financial Indebtedness existed at the time that the Controlled Subsidiary became a part of the Controlled Group and was not created in contemplation of that Controlled Subsidiary becoming part of the Controlled Group; or

 

(v)                              any Security Interest over loan notes or other securities issued by Verizon Communications Inc. or any of its affiliates in connection with the acquisition of Vodafone’s interest in Verizon Wireless (the “Verizon Notes”), provided that:

 

(i)                                  the maximum aggregate principal amount of Verizon Notes which may be subject to Security Interests pursuant to this paragraph (v) is U.S.$5,000,000,000;

 

(ii)                              the Security Interest is removed or discharged within 30 months from the date of issuance of the Verizon Notes; and

 

(iii)                          the Security Interest was created for the purpose of, or in contemplation of, an issuance by Vodafone of loan notes or other securities which are secured by that Security Interest (the “Secured Notes”), provided that any holders of the Secured Notes shall not have any recourse to Vodafone in respect of any amounts outstanding (other than interest payable) under or in connection with the Secured Notes; or

 

(w)                           any other Security Interest (in addition to those listed in (a) to (v) above) where the aggregate principal amount secured by all such Security Interests does not exceed €3,000,000,000 or its equivalent.

 

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“Plan”

 

means an “employee benefit plan” as defined in Section 3(3) of ERISA.

 

“Prime Rate”

 

means the rate of interest most recently published in the Money Rates section of The Wall Street Journal from time to time as the Prime Rate in the U.S. or, if The Wall Street Journal ceases to quote such rate, the highest per annum interest rate published by the Federal Reserve Board in Federal Reserve Statistical Release H.15 (519) (Selected Interest Rates) as the “bank prime loan” rate or, if such rate is no longer quoted therein, any similar rate quoted therein (as determined by the U.S. Swingline Agent) or any similar release by the Federal Reserve Board (as determined by the U.S. Swingline Agent). Any change in such prime rate shall take effect at the opening of business on the day specified in the public announcement of such change.

 

“Principal Subsidiary”

 

means, from the date that each notice is given by Vodafone to the Agent pursuant to Clause 17.2(c) (Financial information) or, as the case may be, 17.2(d) (Financial information) the four Controlled Subsidiaries which are members of the Restricted Group whose revenues are primarily generated by operations licensed by telecommunications authorities in Core Jurisdictions (excluding for this purpose any Subsidiaries whose principal activity is to act as a Holding Company of other Subsidiaries) that had the largest, if positive or smallest if negative Operating Cash Flow in the previous financial year of Vodafone or, following the Reorganisation Date, NewTopco.

 

Until the first notice is given by Vodafone to the Agent (in respect of the financial year ended 31 March 2015), the Principal Subsidiaries are Vodafone Limited, Vodafone GmbH, Vodafone Omnitel N.V. and Vodafone Libertel B.V. being Vodafone’s principal subsidiaries operating in UK, Germany, Italy and the Netherlands, respectively.

 

For the purposes of this definition, until such new notice is given by Vodafone to the Agent pursuant to Clause 17.2(c) (Financial information) or, as the case may be, Clause 17.2(d) (Financial information), if any Principal Subsidiary sells, transfers, merges into or with or otherwise disposes of the majority of its undertakings or assets whether by a single transaction or a number of related transactions (unless such Principal Subsidiary is the surviving entity following such merger) (the “Seller”) to any member of the Restricted Group (the “Purchaser”), then from the date of the relevant sale, transfer, merger or disposal the Purchaser shall be deemed to become a Principal Subsidiary and the Seller shall no longer be deemed to be a Principal Subsidiary.

 

On the date of each notice given by Vodafone (or as the case may be, NewTopco) to the Agent pursuant to Clause 17.2(c) (Financial information) or, as the case may be, Clause 17.2(d) (Financial information), any Subsidiary which is identified as a Principal Subsidiary in the relevant notice, which was not identified as such in the immediately preceding notice, shall be deemed to immediately replace any Subsidiary which was a Principal Subsidiary immediately prior to the delivery of the notice and which is not named in such notice.

 

“Project Finance Indebtedness”

 

means any Financial Indebtedness which finances or otherwise relates to the acquisition, development, ownership and/or operation of an asset or combination of assets whether directly or indirectly, where the Financial Indebtedness is incurred pursuant to facilities

 

23

 

available prior to the date the relevant entity becomes a member of the Controlled Group (and not created in contemplation of the acquisition):

 

(a)                               which is incurred by a Project Finance Subsidiary; or

 

(b)                              in respect of which the person or persons to whom such borrowing is or may be owed by the relevant debtor (whether or not a member of the Controlled Group) has or have no recourse whatsoever to any member of the Controlled Group (other than to a Project Finance Subsidiary) for any payment or repayment in respect thereof other than:

 

(i)                                  recourse to such debtor for amounts limited to the cash flow or net cash flow (other than historic cash flow or historic net cash flow) from such asset or assets; and/or

 

(ii)                              recourse to such debtor for the purpose only of enabling amounts to be claimed in respect of such Financial Indebtedness in an enforcement of any Security Interest given by such debtor over such asset or assets or the income, cash flow or other proceeds deriving from the asset (or given by any shareholder or the like in the debtor over its shares and/or other ownership interest in and/or loans to the debtor) to secure such Financial Indebtedness or any recourse referred to in paragraph (iii) below, provided that:

 

(A)         the extent of such recourse to such debtor is limited solely to the amount of any recoveries made on any such enforcement; and

 

(B)                            such person or persons are not entitled, by virtue of any right or claim arising out of or in connection with such Financial Indebtedness, to commence proceedings for the winding up or dissolution of the debtor or to appoint or procure the appointment of any receiver, trustee or similar person or officer in respect of the debtor or any of its assets (save only for the assets the subject of that Security Interest); and/or

 

(iii)                          recourse:

 

(A)                           to such debtor generally, or directly or indirectly to a member of the Controlled Group, under any form of assurance, undertaking or support which recourse is limited to a claim for damages (other than liquidated damages and damages required to be calculated in a specific way) for breach of an obligation (not being a payment obligation or any obligation to procure payment by another or an indemnity in respect thereof or any obligation to comply or procure compliance by another with any financial ratios or other tests of financial condition) by the person against whom such recourse is available; and/or

 

(B)                            to shares and/or other ownership interest in and/or loans to and/or the assets of such debtor and/or any Project Finance Subsidiary owned by a member of the Controlled Group; or

 

(c)                               which the Majority Lenders have agreed in writing to treat as Project Finance Indebtedness.

 

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“Project Finance Subsidiary”

 

means any member of the Controlled Group:

 

(a)                               whose principal assets and business are constituted by the ownership, acquisition, development and/or operation of any asset or combination of assets whether directly or indirectly; and

 

(b)          none of whose Financial Indebtedness in respect of the financing of the ownership, acquisition, development and/or operation of any such asset benefits from any recourse whatsoever (including, without limitation, any obligation to subscribe for equity or provide loans) to any member of the Controlled Group (other than such person or another Project Finance Subsidiary) in respect of any payment or repayment in respect thereof, except as expressly referred to in paragraph (b)(iii) of the definition of “Project Finance Indebtedness”; and

 

(c)                               which has been designated as such by Vodafone by written notice to the Agent.

 

“Qualifying Financial Institution”

 

means any bank or financial institution that as part of its business generally receives deposits or other repayable funds and grants credits for its own account.

 

“Qualifying Lender”

 

means a Lender which is beneficially entitled to interest payable to that Lender in respect of an Advance and is:

 

(a)                               a Lender;

 

(i)                                  which is a bank (as defined for the purpose of Section 879 of the ITA 2007) making an Advance under this Agreement; or

 

(ii)                              in respect of an Advance made under this Agreement by a person that was a bank (as defined for the purpose of Section 879 of the ITA 2007) at the time that that Advance was made,

 

and which is within the charge to United Kingdom corporation tax as respects any payments of interest made in respect of that Advance at the time payments are made (or in the case of sub-paragraph (i) above would be within such charge as respects such payments apart from section 18A of the CTA); or

 

(b)                              a Treaty Lender.

 

“Rate Fixing Day”

 

means:

 

(a)                               the Drawdown Date for an Advance denominated in Sterling; or

 

(b)                              the second TARGET Day before the Drawdown Date for an Advance denominated in euro; or

 

(c)                               the second Business Day before the Drawdown Date for an Advance denominated in any other currency,

 

25

 

or such other day as the Agent, after consultation with Vodafone and the Lenders, may designate as market practice in the Relevant Interbank Market for leading banks to give quotations in the relevant currency for delivery on the relevant Drawdown Date.

 

“Ratio Period”

 

has the meaning given to it in Clause 18.2 (Calculation times and periods).

 

“Recovering Finance Party”

 

has the meaning given to it in Clause 30.1 (Redistribution).

 

“Recovery”

 

has the meaning given to it in Clause 30.1 (Redistribution).

 

“Redistribution”

 

has the meaning given to it in Clause 30.1(c) (Redistribution).

 

“Reference Banks”

 

means, subject to Clause 27.10 (Reference Banks), the principal London offices of BNP Paribas, Barclays Bank PLC, JPMorgan Chase Bank, N.A. and The Royal Bank of Scotland plc.

 

“Reference Bank Quotation”

 

means any quotation supplied to the Agent by a Reference Bank.

 

“Reference Bank Rate”

 

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

 

(a)                               in relation to LIBOR:

 

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

 

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

 

(b)                              in relation to EURIBOR:

 

(i)                                  (other than where paragraph (ii) below applies) as the rate at which the relevant Reference Bank believes that one prime bank is quoting to another prime bank for interbank term deposits in euro within the Participating Member States for the relevant period; or

 

26

 

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

 

“Reference Bond”

 

has the meaning given to it in Clause 9.5(d) (Margin).

 

“Relevant Interbank Market”

 

means, in relation to euro, the European interbank market and, in relation to any other currency, the London interbank market.

 

“Relevant Tax”

 

means any tax imposed or levied by or in (or by any political sub-division or taxing authority of any of the following):

 

(a)                               the UK;

 

(b)                              the United States; or

 

(c)                               any other jurisdiction in or through which any payment under the Finance Documents is made.

 

“Reportable Event”

 

means a reportable event as defined in Section 4043 of ERISA and the regulations issued under such section with respect to a Plan, excluding, however, such events as to which the PBGC by regulation waived the requirement of Section 4043(a) of ERISA that it be notified within 30 days of the occurrence of such event, provided, however, that a failure to meet the minimum funding standard of Section 412 of the Code and of Section 302 of ERISA shall be a Reportable Event regardless of the issuance of any such waiver of the notice requirement in accordance with either Section 4043(a) of ERISA or Section 412(d) of the Code.

 

“Reorganisation Date”

 

means the date NewTopco or any other Intermediate Holding Company acquires any shares or assets (other than the shares in Vodafone acquired pursuant to the Hive Up) in circumstances where the aggregate market value of the assets of Vodafone (as determined by Vodafone (acting reasonably)) immediately following the acquisition is an amount which represents 95 per cent. or less of the aggregate market value of the assets of NewTopco (as determined by Vodafone (acting reasonably)) at that time.

 

“Request”

 

means a request made by a Borrower to utilise a Facility, substantially in the form of Schedule 3 (or in such other form as may be agreed by the Agent and Vodafone).

 

“Requested Amount”

 

means the amount requested in a Request.

 

“Restricted Group”

 

27

 

means Vodafone, NewTopco (following the Reorganisation Date) and any Controlled Subsidiary (other than a Project Finance Subsidiary) of Vodafone or, following the Reorganisation Date, NewTopco:

 

(a)                               whose principal operations or assets are located in a Core Jurisdiction; and/or

 

(b)                              whose revenues are primarily generated by operations licensed by telecommunications authorities in Core Jurisdictions,

 

but excludes any Controlled Subsidiary whose principal business is satellite telecommunications.

 

“Revolving Credit Advance”

 

means an advance (other than a Swingline Advance) made to a Borrower by the Revolving Credit Lenders under the Revolving Credit Facility.

 

“Revolving Credit Commitment”

 

means:

 

(a)                               in respect of an Original Lender, the amount in U.S. Dollars set opposite the name of that Lender in Part 1 of Schedule 1 (Lenders and Commitments) or assumed by it in accordance with Clause 2.3 (Increase); and

 

(b)                              in respect of an Additional Lender, the amount in U.S. Dollars set out as a Revolving Credit Commitment in the relevant Lender Accession Agreement or assumed by it in accordance with Clause 2.3 (Increase),

 

in each case to the extent not transferred, cancelled or reduced under or in accordance with this Agreement.

 

“Revolving Credit Facility”

 

means the multicurrency revolving credit facility referred to in a Clause 2.1(a) (Facilities).

 

“Revolving Credit Lender”

 

means, subject to Clause 27.2 (Transfers by Lenders), a Lender listed in Part 1 of Schedule 1 (Lenders and Commitments) in its capacity as a participant in the Revolving Credit Facility and/or an Additional Lender.

 

“Rollover Advance”

 

means any Advance (other than a Swingline Advance) made during the Availability Period which is drawn down to refinance in whole or in part any outstanding Advance (other than a Swingline Advance) where, after making and applying the proceeds of that Advance, the aggregate principal amount outstanding under the Revolving Credit Facility is not greater than the aggregate amount outstanding under that Facility immediately prior to that Advance being made.

 

“Screen Rate”

 

means:

 

28

 

(a)                               in relation to LIBOR, the London interbank offered rate administered by ICE Benchmark Administration Limited (or any other person which takes over the administration of that rate) for the relevant currency and period displayed on pages LIBOR01 or LIBOR02 of the Thomson Reuters screen (or any replacement Thomson Reuters page which displays that rate); and

 

(b)                              in relation to EURIBOR, the euro interbank offered rate administered by the European Money Markets Institute (or any other person which takes over the administration of that rate) for the relevant period displayed on page EURIBOR01 of the Thomson Reuters screen (or any replacement Thomson Reuters page which displays that rate),

 

or, in each case, on the appropriate page of such other information service which publishes that rate from time to time in place of Thomson Reuters. If such page or service ceases to be available, the Agent may specify another page or service displaying the relevant rate after consultation with Vodafone.

 

“S&P”

 

means Standard & Poor’s Rating Services.

 

“Security Interest”

 

means any mortgage, charge, assignment by way of security, pledge, lien or other security interest securing any obligation of any person.

 

“Separate Loan”

 

has the meaning given to that term in Clause 7.3 (Separate Loans).

 

“Signing Date”

 

means the date of this Agreement.

 

“Single Employer Plan”

 

means a Plan which is maintained by any U.S. Obligor or any member of the Controlled USA Group for employees of Vodafone or any member of the Controlled USA Group.

 

“Subsidiary”

 

means:

 

(a)                               a subsidiary within the meaning of section 1159 of the Companies Act 2006; and

 

(b)                              unless the context otherwise requires, a subsidiary undertaking within the meaning of section 1162 of the Companies Act 2006.

 

“Substitute Security Interest”

 

has the meaning given to it in the definition of Permitted Security Interest, paragraph (q).

 

“Swingline Advance”

 

29

 

means an advance made to a Borrower by the Swingline Lenders under the Swingline Facility.

 

“Swingline Affiliate”

 

means, in relation to a Lender, any Swingline Lender that is an Affiliate of that Lender and which is notified to the Agent and the U.S. Swingline Agent by that Lender in writing to be its Swingline Affiliate.

 

“Swingline Commitment”

 

means:

 

(a)                               in respect of a Swingline Lender which is an Original Lender, the amount in U.S. Dollars set opposite its name under the heading “Swingline Commitment” in Part 2 of Schedule 1 (Swingline Lenders and Swingline Commitments) or assumed by it in accordance with Clause 2.3 (Increase); and

 

(b)                              in respect of a Swingline Lender which is an Additional Lender, the amount in U.S. Dollars set out as a Swingline Commitment in the relevant Lender Accession Agreement or assumed by it in accordance with Clause 2.3 (Increase),

 

in each case to the extent not transferred, cancelled or reduced under or in accordance with this Agreement.

 

“Swingline Facility”

 

means the committed U.S. Dollars swingline facility referred to in Clause 2.1(b) (Facilities).

 

“Swingline Lender”

 

means, subject to Clause 27.2 (Transfers by Lenders), an Original Lender listed in Part 2 of Schedule 1 as a swingline lender or an Additional Lender in respect of which a Swingline Commitment is specified in the relevant Lender Accession Agreement.

 

“Swingline Rate”

 

means, on any day, the higher of:

 

(a)                               the Prime Rate; and

 

(b)                              the aggregate of the Federal Funds Rate plus 0.50 per cent. per annum.

 

“Swingline Total Commitments”

 

means the aggregate for the time being of the Swingline Commitments, being U.S.$1,650,000,000 at the date of this Agreement or as may be increased pursuant to paragraph (b) of Clause 2.8 (Additional Lenders) up to a maximum of U.S.$5,000,000,000.

 

“TARGET Day”

 

means a day on which the Trans-European Automated Real-Time Gross Settlement Express Transfer (TARGET) payment system which utilises a single shared platform and which was launched on 19 November 2007 and is open for the settlement of payments in euro.

 

30

 

“Tax Credit”

 

has the meaning given to it in Clause 11.6 (Refund of Tax Credits).

 

“Tax on Overall Net Income”

 

in relation to a Finance Party, means any tax on the overall net income, profits or gains of that Finance Party or any of its Holding Companies (or the overall net income, profits or gains of a division or branch of that Finance Party or any of its Holding Companies).

 

“Tax Payment”

 

has the meaning given to it in Clause 11.6 (Refund of Tax Credits).

 

“Taxes Act”

 

means the Corporation Tax Act 2010.

 

“Term”

 

means the period selected by a Borrower in a Request for which the relevant Revolving Credit Advance or Swingline Advance is to be outstanding.

 

“Total Commitments”

 

means the aggregate for the time being of the Revolving Credit Commitments, being, at the date of this Agreement, U.S.$3,935,000,000 or as may be increased pursuant to paragraph (b) of Clause 2.8 (Additional Lenders) up to a maximum of U.S.$7,500,000,000 (including the Swingline Total Commitments but without double counting).

 

“Total Gross Borrowings”

 

means at any time, the aggregate outstanding principal amount of Financial Indebtedness of the Consolidated Group (including the marked to market position of out of the money derivative contracts).

 

“Treaty Lender”

 

means a Lender which is (i) resident (as such term is defined in the appropriate double taxation treaty) in a country with which the United Kingdom has an appropriate double taxation treaty under which residents of that country are entitled to complete exemption from United Kingdom tax on interest and is entitled to apply under the Double Taxation Relief (Taxes on Income) (General) Regulations 1970 to have interest paid to its Facility Office without withholding or deduction for or on account of United Kingdom taxation; and (ii) does not carry on business in the United Kingdom through a permanent establishment with which the investments under this Agreement in respect of which the interest is paid are effectively connected; and for this purpose “double taxation treaty” means any convention or agreement between the government of the United Kingdom and any other government for the avoidance of double taxation and the prevention of fiscal evasion with respect to taxes on income and capital gains.

 

31

 

“UK” or “United Kingdom”

 

means the United Kingdom of Great Britain and Northern Ireland (but excluding, for the avoidance of doubt, the Channel Islands).

 

“Undisclosed Administration”

 

means in relation to a Lender the appointment of an administrator, provisional liquidator, conservator, receiver, trustee, custodian or other similar official by a supervisory authority or regulator under or based on the laws of the country where such Lender is subject to home jurisdiction supervision if applicable law requires that such appointment is not to be publicly disclosed.

 

“United States”

 

means the United States of America.

 

“U.S. Obligor”

 

means any Obligor which is incorporated in the United States or any State thereof (including the District of Columbia).

 

“U.S. Tax Obligor”

 

means:

 

(a)                               a Borrower which is resident for tax purposes in the United States; or

 

(b)                              an Obligor some or all of whose payments under the Finance Documents are from sources within the United States for United States federal income tax purposes

 

“2016 Facility”

 

means the U.S.$4,015,000,000 multi currency revolving five year facility dated 9 March 2011 with a capacity of U.S.$4,245,000,000 as at 9 March 2011 and made between, amongst others, Vodafone Group Plc, the Arrangers and Lenders identified therein and The Royal Bank of Scotland plc as Agent and Euro Swingline Agent and due 9 March 2016 .

 

“2019 Facility”

 

means the €3,860,000,000 multicurrency revolving five year facility dated 28 March 2014 with a capacity of €3,860,000,000 as at March 2014 and made between, amongst others, Vodafone Group Plc, the Arrangers and the Lenders identified therein and the Royal Bank of Scotland plc as Agent and Euro Swingline Agent and due 28 March 2019.

 

1.2                            Construction

 

(a)                               In this Agreement, unless the contrary intention appears, a reference to:

 

(i)                                  “agreed form” means, in relation to any document, such document in a form previously agreed in writing by or on behalf of the Agent and Vodafone;

 

“assets” of any person includes all or any part of that person’s business, operations, undertaking, property, assets, revenues (including any right to receive revenues) and uncalled capital;

 

32

 

an “authorisation” includes an authorisation, consent, approval, resolution, licence, exemption, filing, registration and notarisation;

 

a “finance lease” has the meaning given to it in IAS 17 as in effect at 1 April 2013;

 

“indebtedness” is a reference to any obligation for the payment or repayment of money, whether as principal or surety and whether present or future, actual or contingent;

 

a “month” is a reference to a period starting on one day in a calendar month and ending on the numerically corresponding day in the next calendar month, except that, if there is no numerically corresponding day in the month in which that period ends, that period shall end on the last Business Day in that month;

 

a “regulation” includes any regulation, rule, official directive, request or guideline (in each case, whether or not having the force of law, but if not having the force of law, is generally complied with by the persons to whom it is addressed) of any governmental or supranational body, agency, department or regulatory, self-regulatory authority or organisation;

 

the determination of the extent to which a rate is “for a period equal in length” to the Term of any interest period shall disregard any inconsistency arising from the last day of the Term of such interest period being determined pursuant to the terms of this Agreement; and

 

“U.S.$”, “USD” and “U.S. Dollars” denote the lawful currency of the United States. “£”, “GBP” and “Sterling” denote the lawful currency of the United Kingdom. “€”, “EUR” and “euro” denote the single currency of the Participating Member States;

 

33

 

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

 

(iii)                          a Clause or a Schedule is a reference to a clause of or a schedule to this Agreement;

 

(iv)                          a person includes its successors, transferees and assigns;

 

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

 

(vi)                          a Finance Document or another document is a reference to that Finance Document or that other document as novated or, with the approval of Vodafone, amended or supplemented;

 

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

 

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

 

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

 

(c)                               The index to and the headings in this Agreement are for convenience only and are to be ignored in construing this Agreement.

 

(d)                              Unless expressly provided to the contrary in a Finance Document, a person who is not a party to a Finance Document may not enforce any of its terms under the Contracts (Rights of Third Parties) Act 1999.

 

(e)                               Subject to Clause 26.2 (Exceptions) but otherwise notwithstanding any term of any Finance Document, the consent of any third party is not required for any variation (including any release or compromise of any liability under) or termination of that Finance Document.

 

2.                                    THE FACILITIES

 

2.1                            Facilities

 

Subject to the terms of this Agreement, the Lenders grant to the Borrowers:

 

(a)                               a committed multicurrency revolving five year facility (subject to Clause 6 (Extension Option)), under which the Lenders will, when requested by a Borrower, make cash advances in U.S. Dollars or Optional Currencies to that Borrower on a revolving basis during the Availability Period already defined; and

 

(b)                              a committed U.S. Dollars swingline advance facility (which is a sub-division of the Revolving Credit Facility) under which the Swingline Lenders will, when requested by a Borrower, make to that Borrower Swingline Advances during the Availability Period.

 

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2.2                            Overall facility limits

 

(a)                               The Swingline Facility is not independent of the Revolving Credit Facility. The aggregate Original Dollar Amount of all outstanding Advances (including Swingline Advances) under:

 

(i)                                  the Revolving Credit Facility, shall not at any time exceed the Total Commitments at that time; and

 

(ii)                              the Swingline Facility, shall not at any time exceed the Swingline Total Commitments at that time.

 

(b)                              The aggregate Original Dollar Amount of:

 

(i)                                  the participations of a Lender in Revolving Credit Advances plus that Lender’s and, if applicable, that Lender’s Swingline Affiliate’s (if any), participations in outstanding Swingline Advances shall not at any time exceed that Lender’s Revolving Credit Commitment at that time; and

 

(ii)                              the participations of a Swingline Lender in Swingline Advances shall not at any time exceed that Swingline Lender’s Swingline Commitment at that time.

 

(c)                               If, in respect of any Revolving Credit Advance, the operation of Clause 5.4 (Amount of each Lender’s participation in an Advance) would otherwise have caused a Lender (the “Affected Lender”) to breach sub-paragraph (b)(i) above then:

 

(i)                                  each Affected Lender will participate in the relevant Revolving Credit Advance only to the extent that the Original Dollar Amount of its participation in that Revolving Credit Advance (when aggregated with the Original Dollar Amount of its and, if applicable, that Lender’s Swingline Affiliate’s (if any), participations in other outstanding Revolving Credit Advances and Swingline Advances) will not exceed its Revolving Credit Commitment; and

 

(ii)          each other non-Affected Lender’s participation in that Revolving Credit Advance will be recalculated in accordance with Clause 5.4 (Amount of each Lender’s participation in an Advance), but, for the purpose of the recalculation, the Affected Lenders’ Revolving Credit Commitments will be deducted from the Total Commitments and the amount of the Affected Lenders’ participations in that Revolving Credit Advance (if any) will be deducted from the requested amount of the Revolving Credit Advance.

 

2.3                            Increase

 

(a)                               Vodafone may by giving prior notice to the Agent by no later than the date falling 60 Business Days after the effective date of a cancellation of:

 

(i)                                  the Available Commitments of a Defaulting Lender in accordance with paragraph (c) of Clause 8.5 (Right of prepayment and cancellation); or

 

(ii)                              the Commitments of a Lender in accordance with Clause 14.1 (Illegality),

 

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

 

(A)                                         the increased Commitments will be assumed by one or more Lenders or other banks or financial institutions (each an “Increase Lender”) selected by Vodafone and which is further acceptable to the Agent (acting reasonably)) and each of which confirms its willingness to assume and does assume all the obligations of a Lender corresponding to that part of the increased Commitments which it is to assume, as if it had been an Original Lender;

 

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

 

(C)                                         each Increase Lender shall become a Party as a “Lender” and any Increase Lender and each of the other Finance Parties shall assume obligations towards one another and acquire rights against one another as that Increase Lender and those Finance Parties would have assumed and/or acquired had the Increase Lender been an Original Lender;

 

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

 

(E)                             any increase in the Total Commitments shall take effect on the date specified by Vodafone in the notice referred to above or any later date on which the conditions set out in paragraph (b) below are satisfied.

 

(b)                              An increase in the Total Commitments will only be effective on:

 

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

 

(ii)                              in relation to an Increase Lender which is not a Lender immediately prior to the relevant increase the performance by the Agent of all necessary “know your customer” or other similar checks under all applicable laws and regulations in relation to the assumption of the increased Commitments by that Increase Lender, the completion of which the Agent shall promptly notify to Vodafone and the Increase Lender.

 

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

 

(d)                              Unless the Agent otherwise agrees or the increased Commitment is assumed by an existing Lender, Vodafone shall, on the date upon which the increase takes effect, pay to the Agent (for its own account) a fee of U.S.$3,000 and Vodafone shall promptly on demand pay the Agent the amount of all costs and expenses (including legal fees) reasonably incurred by it in connection with any increase in Commitments under this Clause 2.3.

 

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(e)                               Vodafone may pay to the Increase Lender a fee in the amount and at the times agreed between Vodafone and the Increase Lender in a letter between Vodafone and the Increase Lender setting out that fee. A reference in this Agreement to a Fee Letter shall include any letter referred to in this paragraph (e).

 

(f)                                Clause 27.2(f) to (j) inclusive (Transfers by Lenders) shall apply mutatis mutandis in this Clause 2.3 in relation to an Increase Lender as if references in that Clause to:

 

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

 

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

 

(iii)                          a “retransfer” were references to a “transfer”.

 

2.4                            Number of Requests and Advances

 

Unless the Agent agrees otherwise, no more than one Request (other than Requests for Swingline Advances only) may be delivered on any one day but that Request may specify any number and type of Advances from the Revolving Credit Facility or the Swingline Facility or either of them.

 

2.5                            Nature of rights and obligations

 

(a)                               The obligations of a Finance Party and each Obligor under the Finance Documents are several. Failure of a Finance Party or an Obligor to carry out those obligations does not relieve any other Party of its obligations under the Finance Documents. No Finance Party or Obligor is responsible for the obligations of any other Finance Party or Obligor under the Finance Documents save and to the extent that the relevant obligations are guaranteed by another Obligor.

 

(b)                              The rights of a Finance Party under the Finance Documents are divided rights. A Finance Party may, except as otherwise stated in the Finance Documents, separately enforce those rights.

 

2.6                            Vodafone as Obligors’ agent

 

Each Obligor:

 

(a)                               irrevocably authorises and instructs Vodafone to give and receive as agent on its behalf all notices (including Requests) and sign all documents in connection with the Finance Documents on its behalf (including but not limited to amendments and variations and execution of any new Finance Documents) and take such other action as may be necessary or desirable under or in connection with the Finance Documents; and

 

(b)                              confirms that it will be bound by any action taken by Vodafone under or in connection with the Finance Documents.

 

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2.7                            Actions of Vodafone as Obligors’ agent

 

The respective liabilities of each of the Obligors under the Finance Documents shall not be in any way affected by:

 

(a)                               any irregularity (or purported irregularity) in any act done by or any failure (or purported failure) by Vodafone; or

 

(b)                              Vodafone acting (or purporting to act) in any respect outside any authority conferred upon it by any Obligor; or

 

(c)                               the failure (or purported failure) by or inability (or purported inability) of Vodafone to inform any Obligor of receipt by it of any notification under this Agreement.

 

2.8                            Additional Lenders

 

(a)          Any financial institution or other entity may, subject to the terms of this Agreement, become an Additional Lender. The relevant financial institution or other entity will become an Additional Lender on the date specified in a Lender Accession Agreement which has been delivered to the Agent duly completed and executed by that financial institution or other entity and countersigned by Vodafone on behalf of itself and each other Obligor.

 

(b)                              Upon the relevant financial institution or other entity becoming an Additional Lender, the Total Commitments shall be increased (subject to the Total Commitments being a maximum of U.S.$7,500,000,000 and the Combined Commitments being a maximum of U.S.$7,500,000,000 plus €7,500,000,000 (or its equivalent in U.S. Dollars calculated at the Agent’s Spot Rate of Exchange)) by the amount set out in the relevant Lender Accession Agreement as that Additional Lender’s Revolving Credit Commitment. If such Additional Lender so provides in the relevant Lender Accession Agreement, the Swingline Total Commitments shall be increased (subject to the Combined Swingline Commitments being a maximum of U.S.$5,000,000,000 plus €2,550,000,000 (or its equivalent in U.S. Dollars calculated at the Agent’s Spot Rate of Exchange)) by the amount set out in the relevant Lender Accession Agreement as that Additional Lender’s Swingline Commitment.

 

(c)                               Each Additional Lender will participate only in Advances with a Drawdown Date following the date on which it became an Additional Lender and only then if:

 

(i)                                  it has become an Additional Lender in time to receive sufficient notice of the relevant Advance from the Agent pursuant to Clause 5.5 (Notification of the Lenders); and

 

(ii)          immediately before such an Advance is to be made either (A) no Advances are or will be outstanding or (B) all outstanding Advances at that time are or will be immediately repaid or prepaid in full in accordance with the terms of this Agreement.

 

(d)                              On and from the Drawdown Date on which the Additional Lender makes an Advance under paragraph (c) above, the Additional Lender shall participate in each new Revolving Credit Advance or, as the case may be, Swingline Advance in accordance with Clause 5.4 (Amount of each Lender’s participation in an Advance).

 

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(e)         The execution by Vodafone of a Lender Accession Agreement constitutes confirmation by each Guarantor that its obligations under Clause 15 (Guarantee) shall continue unaffected except that those obligations shall extend to the Total Commitments as increased by the addition of the relevant Additional Lender’s Revolving Credit Commitment (including such Additional Lender’s Swingline Commitment but without double counting) and shall be owed to each Finance Party including the relevant Additional Lender.

 

3.                                    PURPOSE

 

3.1                            Purpose

 

Each Revolving Credit Advance will be used for the refinancing of the 2016 Facility, following which each Advance will be applied in or towards providing support for the Consolidated Group’s continuing commercial paper programmes and each Revolving Credit Advance will be applied for general corporate purposes of the Consolidated Group including, but not limited to, Acquisitions (provided that a Swingline Advance may not be applied in or towards refinancing another Swingline Advance).

 

3.2                            No monitoring

 

Without affecting the obligations of any Borrower in any way, no Finance Party is bound to monitor or verify the application of the proceeds of any Advance.

 

4.                                    CONDITIONS PRECEDENT

 

4.1                            Initial conditions precedent

 

The obligations of each Finance Party to any Borrower under this Agreement are subject to the conditions precedent that:

 

(a)                               the Agent has notified Vodafone and the Lenders that it has received all of the documents set out in Part 1 of Schedule 2 in the agreed form or such other form and substance satisfactory to the Agent. The Agent will give such notice of receipt within two Business Days after receiving the relevant documents and finding them in form and substance satisfactory to it; and

 

(b)                              the Agent confirms on or prior to the Signing Date that (i) the 2016 Facility has been cancelled and (ii) all amounts outstanding under such 2016 Facility have been repaid.

 

4.2                            Conditions to all drawdowns and rollovers

 

The obligations of each Lender to participate in any Advance are subject to the further conditions precedent that on the date of the Request for the Advance (if applicable) and on the date on which the relevant amount is to be drawn down:

 

(a)                               the representations and warranties in Clause 16 (Representations and Warranties) are correct and will be correct immediately after the relevant Advance or amount is drawn down in each case in all material respects; and

 

(b)                              in the case of a Rollover Advance, no Event of Default is continuing or would result from the proposed Advance, and in the case of any other drawdown, no Default has occurred and is continuing or would result from drawdown of the relevant Advance or amount.

 

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4.3                            Conditions relating to Optional Currencies

 

(a)                               A currency will constitute an Optional Currency in relation to an Advance if

 

(i)                                  it is readily available in the amount required and freely convertible into the Base Currency in the Relevant Interbank Market on the Rate Fixing Day and the Drawdown Date for that Advance; and

 

(ii)                              it is Sterling or euro, or has been approved by the Agent (acting on the instructions of all the Lenders) on or prior to receipt by the Agent of the relevant Request for that Advance.

 

(b)                              If by 10:00 a.m. on a Business Day, the Agent has received a written request from Vodafone for a currency to be approved under paragraph (a)(ii) above, the Agent will notify the Lenders of that request by 3:00 p.m. on the same Business Day. Based on any responses received by the Agent by 1:00 p.m. the next Business Day, the Agent will confirm to Vodafone by 5:00 p.m. on that Business Day:

 

(i)                                  whether or not the Lenders have granted their approval; and

 

(ii)                              if approval has been granted, the minimum amount (and, if required, integral multiples) for any subsequent Utilisation in that currency.

 

4.4                            Maximum number of Revolving Credit Advances

 

A Borrower may not deliver a Request if as a result of the proposed Advance more than 10 Revolving Credit Advances would be outstanding.

 

5.                                    ADVANCES

 

5.1                            Receipt of Requests

 

(a)                               A Borrower may borrow Advances under the Revolving Credit Facility (other than Swingline Advances) if the Agent receives, not later than 5.00 p.m. on the third Business Day before the proposed Drawdown Date, or, in the case of an Advance in Sterling, not later than 5.00 p.m. on the Business Day before the proposed Drawdown Date, a duly completed Request, copied, to the U.S. Swingline Agent.

 

(b)                              A Borrower may borrow Swingline Advances if the U.S. Swingline Agent receives, not later than 11.00 a.m. (New York City time) on the proposed Drawdown Date, a duly completed Request, copied to the Agent.

 

5.2                            Completion of Requests for Revolving Credit Advances

 

A Request for a Revolving Credit Advance will not be regarded as having been duly completed unless:

 

(a)                               the Drawdown Date is a Business Day falling during the Availability Period;

 

(b)                              only one currency is specified for each separate Advance and the Requested Amount for each separate Advance is in a minimum amount:

 

(i)                                  if in euro, of €25,000,000;

 

(ii)                              if in Sterling, of £20,000,000;

 

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(iii)                          if in U.S. Dollars, of U.S.$25,000,000; or

 

(iv)                          appropriate equivalent minimum amounts for Optional Currencies other than euro or Sterling,

 

or, in any such case:

 

(A)                           if less, is in an amount equal to the unutilised portion of the Total Commitments; or

 

(B)                            such other amount as Vodafone and the Agent may agree;

 

(c)                               only one Term for each separate Advance is specified which:

 

(i)                                  does not overrun the Final Maturity Date; and

 

(ii)                              is a period of 7 days, one month, two, three (or such comparable period as the Borrower may adopt to reflect international futures exchange settlement dates) or six months (or such other period as may be agreed by Vodafone and (if not more than six months) the Agent or (if more than six months) all of the Lenders); and

 

(d)                              the payment instructions comply with Clause 10.1 (Place of payment).

 

5.3                            Completion of Requests for Swingline Advances

 

A Request for a Swingline Advance will not be regarded as having been duly completed unless:

 

(a)                               the Drawdown Date is a New York Business Day falling during the Availability Period;

 

(b)                              it is specified that the Swingline Advance is to be made in U.S. Dollars under the Swingline Facility;

 

(c)                               the Requested Amount is a minimum of U.S.$15,000,000 or such other amount as the U.S. Swingline Agent and Vodafone may agree;

 

(d)                              only one Term is specified, which:

 

(i)                                  does not overrun the Final Maturity Date; and

 

(ii)                              is a period not exceeding five Business Days; and

 

(e)                               the payment instructions comply with Clause 10.1 (Place of payment).

 

5.4                            Amount of each Lender’s participation in an Advance

 

The amount of a Lender’s participation in an Advance will be the proportion of the Requested Amount which:

 

(a)                               in the case of a Revolving Credit Advance, its Revolving Credit Commitment bears to the Total Commitments; and

 

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(b)                              in the case of a Swingline Advance, its Swingline Commitment bears to the Swingline Total Commitments,

 

in each case on the date of receipt of the relevant Request, adjusted in the case of paragraph (a) above (if necessary) to reflect the operation of Clause 2.2(c) (Overall facility limits).

 

5.5                            Notification of the Lenders

 

The Agent (or, in the case of Swingline Advances, the U.S. Swingline Agent) shall promptly notify each Lender (or, as the case may be, Swingline Lender) of the details of the requested Advance and the amount of its participation in such Advance.

 

5.6                            Payment of proceeds

 

Subject to the terms of this Agreement, each Lender (or, as the case may be, Swingline Lender) shall make its participation in an Advance available to the Agent (or, in the case of a participation in a Swingline Advance, the U.S. Swingline Agent) for the Borrower concerned for value on the relevant Drawdown Date.

 

6.                                    EXTENSION OPTIONS

 

6.1                            First extension option

 

(a)                               Vodafone may by notice to the Agent (the “First Extension Request”) not more than 60 days and not less than 30 days before the first anniversary of the date of this Agreement (the “First Anniversary”), request that the Final Maturity Date be extended to the date which is six years after the date of this Agreement (the “Sixth Anniversary”).

 

(b)                              The Agent must promptly notify the Lenders of the First Extension Request.

 

(c)                               Each Lender may, in its sole discretion, agree to the First Extension Request. Subject to paragraph (g) below, each Lender that agrees to the First Extension Request by the date falling 15 days before the First Anniversary, will, on the First Anniversary, extend its Commitments to the Sixth Anniversary and the Final Maturity Date with respect to the Commitments of that Lender will be extended to that date.

 

(d)                              If any Lender fails to reply to the First Extension Request on or before the date falling 15 days before the First Anniversary, it will be deemed to have refused the First Extension Request and its Commitments will not be extended.

 

(e)                               Subject to paragraph (g) below, the First Extension Request is irrevocable.

 

(f)                                If one or more (but not all) of the Lenders agree to the First Extension Request, then by the date falling no later than ten days before the First Anniversary, the Agent must notify Vodafone and the Lenders which have agreed to the first extension, identifying in that notification which Lenders have not agreed to the First Extension Request.

 

(g)                               Vodafone may, on the basis that one or more of the Lenders have not agreed to the First Extension Request and no later than the date falling 5 days before the First Anniversary, withdraw the request by notice to the Agent which will promptly notify the Lenders.

 

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6.2                            Second extension option

 

(a)                               If the Final Maturity Date has been extended to the Sixth Anniversary pursuant to Clause 6.1 (First extension option), Vodafone may by notice to the Agent (the “Second Extension Request”) not more than 60 days and not less than 30 days before the second anniversary of the date of this Agreement (the “Second Anniversary”), request that the Final Maturity Date be extended to the date which is seven years after the date of this Agreement (the “Seventh Anniversary”).

 

(b)                              The Agent must promptly notify the Lenders of the Second Extension Request.

 

(c)                               Each Lender may, in its sole discretion, agree to the Second Extension Request. Subject to paragraph (g) below, each Lender that agrees to the Second Extension Request by the date falling 15 days before the Second Anniversary, will, on the Second Anniversary, extend its Commitments to the Seventh Anniversary and the Final Maturity Date with respect to the Commitments of that Lender will be extended to that date.

 

(d)                              If any Lender fails to reply to the Second Extension Request on or before the date falling 15 days before the Second Anniversary, it will be deemed to have refused the Second Extension Request and its Commitments will not be extended.

 

(e)                               Subject to paragraph (g) below, the Second Extension Request is irrevocable.

 

(f)                                If one or more (but not all) of the Lenders agree to the Second Extension Request, then by the date falling no later than ten days before the Second Anniversary, the Agent must notify Vodafone and the Lenders which have agreed to the second extension, identifying in that notification which Lenders have not agreed to the Second Extension Request.

 

(g)                               Vodafone may, on the basis that one or more of the Lenders have not agreed to the Second Extension Request and no later than the date falling 5 days before the Second Anniversary, withdraw the request by notice to the Agent which will promptly notify the Lenders.

 

7.                                    REPAYMENT

 

7.1                            Repayment of Revolving Credit Advances

 

(a)                               Each Borrower shall repay each Revolving Credit Advance made to it in full on its Maturity Date to the Agent for the Lenders, but since the Revolving Credit Facility is available on a revolving basis during the Availability Period amounts repaid may be reborrowed subject to the terms of this Agreement.

 

(b)                              No Revolving Credit Advance may be outstanding after the Final Maturity Date.

 

7.2                            Repayment of Swingline Advances

 

(a)                               Each Borrower shall repay each Swingline Advance made to it in full on its Maturity Date to the U.S. Swingline Agent for the Swingline Lenders. No Swingline Advance may be outstanding after the Final Maturity Date.

 

(b)                              Each Swingline Advance shall be repaid on its Maturity Date in accordance with paragraph (a) above. In the event and to the extent that a Swingline Advance is not so repaid, each Lender will, within four Business Days of a demand to that effect from the U.S. Swingline Agent, pay to the U.S. Swingline Agent on behalf of the Swingline Lenders (which shall be deemed to be a drawing of that Lender’s

 

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Commitment) an amount equal to its Agreed Percentage (without set-off, counterclaim, withholding or other deduction) of the principal amount outstanding of such Swingline Advance and accrued interest (including default interest) thereon to the date of actual payment by such Lender (provided that no Lender shall be obliged to exceed its Commitment as a result of any such payment). The relevant Borrower shall forthwith reimburse the Lenders (through the Agent) in full for each payment made by the Lenders under this paragraph (b). Each amount the relevant Borrower is required to reimburse to the Lenders under this paragraph (b) shall be deemed to be an Overdue Amount which fell due for payment by the relevant Borrower on the day on which the payment by the Lenders giving rise to the reimbursement obligation was made and shall accrue default interest under Clause 9.3 (Default interest) accordingly. The obligations of each Lender under this paragraph (b) are unconditional and shall not be affected by the occurrence or continuance of a Default.

 

7.3                            Separate Loans

 

(a)                               At any time when a Lender becomes a Defaulting Lender, the maturity date of each of the participations of that Lender in the Facilities then outstanding will be automatically extended to the earlier of:

 

(i)                                  the first Business Day falling 364 days after the date on which the Agent or a Borrower gives notice to the Defaulting Lender and the other Parties that the relevant Lender has become a Defaulting Lender, and will be treated as separate Facilities (the “Separate Loans”) denominated in the currency in which the relevant participations are outstanding; and

 

(ii)                              the last day of the Availability Period.

 

(b)                              A Borrower to whom a Separate Loan is outstanding may prepay that Separate Loan by giving 10 Business Days’ prior notice to the Agent. The Agent will forward a copy of a prepayment notice received in accordance with this paragraph (b) to the Defaulting Lender concerned as soon as practicable on receipt.

 

(c)                               Interest in respect of a Separate Loan will accrue for successive Terms selected by a Borrower by the time and date specified by the Agent acting reasonably and will be payable by that Borrower to the Defaulting Lender on the last day of each Term of that Advance.

 

(d)                              The terms of this Agreement relating to the Facilities generally shall continue to apply to Separate Loans other than to the extent inconsistent with paragraphs (a) to (c) above (inclusive) in which case those paragraphs shall prevail in respect of any Separate Loans.

 

(e)                               If at any time while a Separate Loan is outstanding the Borrower transfers the relevant Defaulting Lender’s outstanding participations to a Replacement Lender in accordance with Clause 27.5 (Replacement of Lenders), each Separate Loan transferred to the Replacement Lender will automatically become, on the last day of the current Term for each such Separate Loan, a Revolving Credit Advance and paragraphs (a) to (c) above (inclusive) shall cease to apply to that Advance while such Replacement Lender is not a Defaulting Lender.

 

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8.                                    PREPAYMENT AND CANCELLATION

 

8.1                            Automatic cancellation of Total Commitments

 

(a)          The Revolving Credit Commitments of each Lender shall be automatically cancelled at the close of business in London on the Final Maturity Date.

 

(b)          The Swingline Commitment of each Swingline Lender shall be automatically cancelled at the close of business in New York on the Final Maturity Date.

 

8.2                            Voluntary cancellation

 

(a)                               Vodafone may by giving not less than one Business Day’s prior written notice to the Agent, cancel the unutilised portion of the Total Commitments in whole or in part (but, if in part, in an aggregate minimum amount of U.S.$75,000,000) in such proportions as Vodafone may designate in the notice of cancellation. Any cancellation in part shall be applied against the Revolving Credit Commitment of each Lender pro rata.

 

(b)                              Whenever part of the Total Commitments is cancelled, the Swingline Commitments will not be cancelled unless (i) the amount of the Swingline Total Commitments would exceed the Total Commitments after such cancellation or (ii) the Swingline Commitment of any Swingline Lender would exceed its Commitment after such cancellation. In any such case, the Swingline Total Commitments shall, at the same time as the cancellation of the Total Commitments takes effect, be cancelled by such amount as is necessary to ensure that after the relevant cancellation of the Total Commitments the Swingline Total Commitments do not exceed the Total Commitments and the Swingline Commitment of each Swingline Lender does not exceed its Commitment.

 

8.3                            Voluntary prepayment

 

(a)                               Any Borrower may by giving not less than five Business Days’ prior written notice to the Agent, prepay the whole or any part of the Revolving Credit Advances (but, if in part, in an aggregate minimum Original Dollar Amount, taking all prepayments made by all the Borrowers on the same day together, of U.S.$100,000,000).

 

(b)          Any Borrower may prepay the whole of any Swingline Advance at any time.

 

(c)          Any voluntary prepayment in part made under paragraph (a) above will be applied against all the Revolving Advances pro rata (or against such Revolving Credit Advances as Vodafone (or the relevant Borrower) may designate in the notice of prepayment).

 

8.4                            Change of Control

 

If control of Vodafone (other than as a result of a Hive Up) or, following a Hive Up, NewTopco, passes to any person acting either individually or in concert (a “Change of Control”):

 

(a)                               Vodafone shall, promptly upon becoming aware thereof, notify the Agent who shall inform the Lenders;

 

(b)                              any Lender may, if it determines that as a result of the Change of Control:

 

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(i)           the level of its exposure to Vodafone, NewTopco and/or the entity which acquires control of Vodafone or NewTopco, as the case may be is unacceptably high in each case in the sole opinion of the Lender; or

 

(ii)          it no longer wishes (in its sole discretion and acting in good faith) to continue lending to Vodafone or NewTopco, as the case may be (whether for relationship, internal policy or any other reason);

 

propose to Vodafone (through the Agent) the revised terms (if any) which it requires in order to continue to participate in the Facilities; and

 

(c)                               if those revised terms have not been agreed with that Lender (or that Lender is not prepared, for one or more of the reasons set out in paragraph (b)(i) or (ii) above, to continue on any terms) within 30 days of the date of notification in paragraph (a) above (or such longer period as that Lender may agree in writing) then on expiry of 30 days from the date of notification in paragraph (a) above that Lender may by notice to the Agent (which shall promptly inform Vodafone) cancel the whole (but not part only) of such Lender’s Commitments and following service of such notice:

 

(i)                                  such Lender’s Commitments shall be cancelled on the date of service of the notice or as specified in it; and

 

(ii)                              all such Lender’s outstanding Advances shall be repaid or prepaid on the last day of the then current Term applicable thereto, and no amount may be outstanding to such Lender thereafter.

 

For the purposes of this Clause 8.4, “control” has the meaning given to it in relation to a body corporate by Section 1124 of the Taxes Act.

 

8.5                            Right of prepayment and cancellation

 

If:

 

(a)                               any Borrower is required to pay or is notified by any Lender in writing that it will be required to pay any amount to a Lender under Clause 11 (Taxes) or Clause 13 (Increased Costs); or

 

(b)                              if circumstances exist such that a Borrower will be required to pay any amount to a Lender under Clause 11 (Taxes) or Clause 13 (Increased Costs),

 

Vodafone may serve a notice of prepayment and cancellation on that Lender through the Agent. On the date falling five Business Days after the date of service of the notice:

 

(i)                                  each Borrower will prepay the participations of that Lender in all outstanding Advances made to that Borrower; and

 

(ii)                              the Lender’s Commitments shall be permanently cancelled on the date of service of the notice.

 

(c)                               If any Lender becomes a Defaulting Lender, Vodafone may, at any time whilst the Lender continues to be a Defaulting Lender, give the Agent five Business Days’ notice of cancellation of each Available Commitment of that Lender.

 

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(d)                              On the notice referred to in paragraph (c) above becoming effective, each Available Commitment of the Defaulting Lender shall immediately be reduced to zero.

 

(e)                               The Agent shall as soon as practicable after receipt of a notice referred to in paragraph (c) above, notify all the Lenders.

 

8.6                            Miscellaneous provisions

 

(a)                               Any notice of prepayment and/or cancellation under this Agreement is irrevocable. The Agent shall notify the Lenders promptly of receipt of any such notice.

 

(b)                              All prepayments under this Agreement shall be made together with accrued interest on the amount prepaid and any other amounts due under this Agreement in respect of that prepayment (including, but not limited to, any amounts payable under Clause 24.2(c) (Other indemnities) if not made on the Maturity Date of the relevant Revolving Credit Advance or Swingline Advance).

 

(c)                               No prepayment or cancellation is permitted except in accordance with the express terms of this Agreement.

 

(d)                              Subject to the provisions of this Agreement, any amount prepaid in respect of the Revolving Credit Facility during the Availability Period may be reborrowed.

 

(e)                               Subject to Clause 2.3 (Increase), no amount of the Total Commitments, (including the Swingline Total Commitments) cancelled under this Agreement may subsequently be reinstated.

 

9.                                    INTEREST

 

9.1                            Interest rate for all Advances

 

(a)                               The rate of interest on each Advance (other than any Swingline Advance) for its Term, is the rate per annum determined by the Agent to be the aggregate of:

 

(i)                                  the applicable Margin; and

 

(ii)                              LIBOR or, in the case of an Advance denominated in euro, EURIBOR.

 

(b)                              The rate of interest on each Swingline Advance for each day during its Term is the rate per annum determined by the U.S. Swingline Agent to be the Swingline Rate for that day.

 

9.2                            Due dates

 

Except as otherwise provided in this Agreement, accrued interest on each Advance is payable by the relevant Borrower on its Maturity Date and also, in the case of any Advance with a Term longer than six months, at six monthly intervals after its Drawdown Date for so long as the Term is outstanding.

 

9.3                            Default interest

 

(a)                               If a Borrower fails to pay any amount payable by it under this Agreement when due (an “Overdue Amount”), it shall forthwith on demand by the Agent or, as the case may be, the U.S. Swingline Agent, pay interest on the Overdue Amount from the due

 

47

 

date up to the date of actual payment, both before and after judgment, at a rate (the “Default Rate”) determined by the Agent or, as the case may be, the U.S. Swingline Agent to be one per cent. per annum (the “Default Margin”) above the higher of:

 

(i)                                  the rate on the Overdue Amount under Clause 9.1 (Interest rate for all Advances) immediately before the due date (in the case of principal); and

 

(ii)                              the rate which would have been payable under Clause 9.1 (Interest rate for all Advances) if the Overdue Amount had, during the period of non-payment, constituted a Revolving Credit Advance in the currency of the Overdue Amount for such successive Terms of such duration as the Agent may determine (each a “Designated Term”),

 

except that during any grace period specified in Clause 19.2 (Non-payment) the Default Margin portion of the Default Rate will only apply to overdue payments of principal.

 

(b)                              The Default Rate will be determined on each Business Day or the first day of, or two Business Days before the first day of, the relevant Designated Term, as appropriate.

 

(c)                               If the Agent or, as the case may be, the U.S. Swingline Agent, determines that deposits in the currency of the Overdue Amount are not at the relevant time being made available by the Reference Banks to leading banks in the Relevant Interbank Market, the Default Rate will be determined by reference to the cost of funds to the Agent or, as the case may be, the U.S. Swingline Agent, from whatever sources it selects, acting reasonably at all times, after consultation with the Reference Banks.

 

(d)                              Default interest will be compounded at the end of each Designated Term.

 

(e)                               The Agent shall notify Vodafone of the duration of each Designated Term.

 

9.4                            Notification of rates of interest

 

(a)                               The Agent or, as the case may be, the U.S. Swingline Agent will promptly notify each relevant Party of the determination of a rate of interest under this Agreement.

 

(b)                              The Agent or, as the case may be, the U.S. Swingline Agent shall promptly notify the Borrower of each Funding Rate relating to an Advance.

 

9.5                            Margin

 

(a)                               The Margin applicable to each Advance will be the lowest percentage rate specified in Column 2 below which corresponds to the criteria in relation to the Long Term Credit Rating Assigned to Vodafone in Column 1 below by Moody’s, Fitch and/or S&P (as the case may be) (each a “Credit Rating Agency”) at the relevant time.

 

 

	
Column 1
    	
Column   2
    
	
Moody’s/Fitch/S&P ratings
    	
Margin   (per cent. per annum)
    
	
 
    	
 
    
	
Any two are equal to or higher than:
    	
0.15
    
	
Aa3/AA-/AA-
    	
 
    
	
 
    	
 
    
	
Any two are equal to or higher than:
    	
0.175
    
	
A1/A+/A+
    	
 
    

 

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Any two are   equal to or higher than: A2/A/A
    	
0.20
    
	
 
    	
 
    
	
Otherwise
    	
0.25
    
	
 
    	
 
    
	
All Quoting   Credit Rating Agencies are lower than: A3/A-/A-
    	
0.30
    

 

For the purposes of this Clause 9.5(a) “All Quoting Credit Rating Agencies” means at any time each Credit Rating Agency which has a Long Term Credit Rating Assigned to Vodafone at the relevant time

 

(b)                              For the purposes of paragraph (a) above:

 

(i)                                  the Margin applicable to an Advance throughout the whole of its Term will be determined according to the Long Term Credit Rating Assigned to Vodafone as at the Drawdown Date of the Advance; and

 

(ii)                              if on the Drawdown Date of any Advance only one Credit Rating Agency assigns a long term credit rating to Vodafone, the Margin applicable to that Advance will be determined in accordance with paragraph (i) by reference to such Long Term Credit Rating Assigned to Vodafone, or in the event that there is no Long Term Credit Rating Assigned to Vodafone the Margin applicable to that Advance will be 0.30 per cent. per annum.

 

In the case of Clause 9.5(b)(ii) above, where the ratings category will be determined by one Credit Rating Agency only, the words “Any two are” and “All Quoting Credit Rating Agencies” in Column 1 of the table above shall be construed as a reference to the rating determined pursuant to Clause 9.5(b)(ii) above.

 

(c)                               Promptly upon becoming aware of the same, Vodafone shall inform the Agent in writing if any change in the Long Term Credit Rating Assigned to Vodafone occurs or the circumstances contemplated by paragraph 9.5(b)(ii) above arise.

 

(d)                              For the purpose of this Clause 9.5 the “Long Term Credit Rating Assigned to Vodafone” means, at any time, the solicited long term credit rating assigned at that time to Vodafone by the relevant Credit Rating Agency (but, for the avoidance of doubt, disregarding any outlook or review action, including placing Vodafone on creditwatch or any similar or analogous step, taken by such Credit Rating Agency) where the rating is based primarily on the unsecured credit risk (not credit enhanced or collateralised) of Vodafone in a manner comparable to the credit structure of Vodafone’s €1,250,000,000 bond issue due January 2022 (the “Reference Bond”), or if the Reference Bond ceases to be outstanding, such other outstanding series of listed bonds issued or guaranteed by Vodafone with a maturity date following and closest to January 2022. References in this paragraph (d) to Vodafone shall, following the Reorganisation Date, be references to NewTopco, provided that a long term credit rating has been assigned to NewTopco.

 

9.6                            Non-Business Days

 

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

 

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10.                            PAYMENTS

 

10.1                    Place of payment

 

All payments by an Obligor or a Lender under this Agreement shall be made to the Agent or (if the payment relates to the Swingline Facility) the U.S. Swingline Agent to its account at such office or bank in the principal financial centre of the country of the relevant currency (or, in the case of euro, in the principal financial centre of a Participating Member State or London) or as it may notify to that Obligor or Lender in writing for this purpose.

 

10.2                    Funds

 

Payments under this Agreement to the Agent or, as the case may be, the U.S. Swingline Agent shall be made for value on the due date at such times and in such funds as the Agent or, as the case may be, the U.S. Swingline Agent may specify to the Party concerned as being customary at the time for the settlement of transactions in the relevant currency in the place for payment.

 

10.3                    Distribution

 

(a)                               Each payment received by the Agent or, as the case may be, the U.S. Swingline Agent under this Agreement for another Party shall, subject to paragraphs (b) and (c) below, be made available by the Agent or, as the case may be, the U.S. Swingline Agent to that Party by payment (on the date of value of receipt and in the currency and funds of receipt) to its account with such bank in the principal financial centre of the country of the relevant currency (or, in the case of euro, in the principal financial centre of a Participating Member State or London) as it may notify to the Agent or, as the case may be, the U.S. Swingline Agent for this purpose by not less than five Business Days’ prior notice.

 

(b)                              The Agent or, as the case may be, the U.S. Swingline Agent may apply any amount received by it for an Obligor in or towards payment (on the date and in the currency and funds of receipt) of any amount due from an Obligor under this Agreement in the same currency on such date or in or towards the purchase of any amount of any currency to be so applied.

 

(c)                               Where a sum is to be paid under this Agreement to the Agent or, as the case may be, the U.S. Swingline Agent for the account of another Party, the Agent or, as the case may be, the U.S. Swingline Agent is not obliged to pay that sum to that Party until it has established that it has actually received that sum. The Agent or, as the case may be, the U.S. Swingline Agent may, however, assume that the sum has been paid to it in accordance with this Agreement and, in reliance on that assumption, make available to that Party a corresponding amount. If the sum has not been made available but the Agent or, as the case may be, the U.S. Swingline Agent has paid a corresponding amount to another Party, that Party shall forthwith on demand refund the corresponding amount to the Agent or, as the case may be, the U.S. Swingline Agent together with interest on that amount from the date of payment to the date of receipt, calculated at a rate reasonably determined by the Agent or, as the case may be, the U.S. Swingline Agent to reflect its cost of funds.

 

10.4                    Currency

 

(a)                                                                               (i)                                  A repayment or prepayment of an Advance is payable in the currency in which the Advance is denominated.

 

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(ii)                              Interest is payable in the currency in which the relevant amount in respect of which it is payable is denominated.

 

(iii)                          Amounts payable in respect of costs, expenses, taxes and the like are payable in the currency in which they are incurred.

 

(iv)                          Any other amount payable under this Agreement is, except as otherwise provided in this Agreement, payable in U.S. Dollars.

 

(b)                              Unless otherwise prohibited by law, if more than one currency or currency unit are at the same time recognised by the central bank of any country as the lawful currency of that country, then:

 

(i)                                  any reference in the Finance Documents to, and any obligations arising under the Finance Documents in, the currency of that country shall be translated into, or paid in, the currency or currency unit of that country designated by the Agent (acting reasonably and after consultation with Vodafone); and

 

(ii)                              any translation from one currency or currency unit to another shall be at the official rate of exchange recognised by the central bank for the conversion of the currency unit into the other, rounded up or down by the Agent (acting reasonably); and

 

(iii)                          if a change in any currency of a country occurs this Agreement will be amended to the extent the Agent and Vodafone agree (such agreement not to be unreasonably withheld) to be necessary to reflect the change in currency and to put the Lenders and the Obligors in the same position, as far as possible, that they would have been in if no change in currency had occurred.

 

10.5                    Set-off and counterclaim

 

Subject to Clause 29.4 (Set-off by Obligors), all payments made by an Obligor under this Agreement shall be made without set-off or counterclaim.

 

10.6                    Non-Business Days

 

(a)                               If a payment under this Agreement is due on a day which is not a Business Day, the due date for that payment shall instead be the next Business Day in the same calendar month (if there is one) or the preceding Business Day (if there is not).

 

(b)                              During any extension of the due date for payment of any principal under this Agreement interest is payable on the principal at the rate payable on the original due date.

 

10.7                    Impaired Agent or U.S. Swingline Agent

 

(a)                               If, at any time, the Agent or, as the case may be, the U.S. Swingline Agent becomes an Impaired Agent, an Obligor or a Lender which is required to make a payment under the Finance Documents to the Agent or U.S. Swingline Agent in accordance with this Clause 10 (Payments) may instead either pay that amount direct to the required recipient or pay that amount to an interest-bearing account held with an Acceptable Bank and in relation to which no Insolvency Event has occurred and is continuing, in the name of the Obligor or the Lender making the payment and designated as a trust account for the benefit of the Party or Parties beneficially

 

51

 

entitled to that payment under the Finance Documents. In each case such payment must be made on the due date for payment under the Finance Documents.

 

(b)                              All interest accrued on the amount standing to the credit of the trust account shall be for the benefit of the beneficiaries of that trust account pro rata to their respective entitlements.

 

(c)                               A party who has made a payment in accordance with this Clause 10.7 shall be discharged of the relevant payment obligation under the Finance Documents and shall not take any credit risk with respect to the amounts standing to the credit of the trust account.

 

(d)                              Promptly upon the appointment of a successor Agent or, as the case may be, successor U.S. Swingline Agent, in accordance with Clause 20.15 (Resignation of the Agent or the U.S. Swingline Agent), each Party which has made a payment to a trust account in accordance with this Clause 10.7 shall give all requisite instructions to the bank with whom the trust account is held to transfer the amount) together with any accrued interest to the successor Agent or, as the case may be, the successor U.S. Swingline Agent for distribution in accordance with Clause 10.3 (Distribution).

 

10.8                    Partial payments

 

(a)                               If the Agent or, as the case may be, the U.S. Swingline Agent receives a payment insufficient to discharge all the amounts then due and payable by an Obligor under this Agreement, the Agent or, as the case may be, the U.S. Swingline Agent shall apply that payment towards the obligations of the Obligors under this Agreement in the following order:

 

(i)                                  first, in or towards payment pro rata of any unpaid costs, fees and expenses of the Agent and the U.S. Swingline Agent under this Agreement;

 

(ii)                              secondly, in or towards payment pro rata of any accrued fees due but unpaid under Clause 21 (Fees);

 

(iii)                          thirdly, in or towards payment pro rata of any interest due but unpaid under this Agreement;

 

(iv)                          fourthly, in or towards payment pro rata of any principal due but unpaid under this Agreement; and

 

(v)                              fifthly, in or towards payment pro rata of any other sum due but unpaid under this Agreement.

 

(b)                              The Agent or, as the case may be, the U.S. Swingline Agent, shall, if so directed by all the Lenders, vary the order set out in paragraphs (a)(ii) to (a)(v) above. The Agent or, as the case may be, the U.S. Swingline Agent, shall notify Vodafone of any such variation.

 

(c)                               Paragraphs (a) and (b) above shall override any appropriation made by any Obligor.

 

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11.                            TAXES

 

11.1                    Gross-up

 

All payments by an Obligor to a Finance Party under the Finance Documents shall be made free and clear of and without deduction for or on account of any Relevant Taxes, except to the extent that the Obligor is required by law to make payment subject to any such taxes. Subject to Clause 11.4 (Qualifying Lenders) and Clause 11.5 (U.S. Taxes), if any Relevant Tax or amounts in respect of Relevant Tax are deducted or withheld from any amounts payable or paid by an Obligor, to a Finance Party under the Finance Documents (in each case, other than a FATCA Deduction), the Obligor shall pay such additional amounts as may be necessary to ensure that the relevant Finance Party receives a net amount equal to the full amount which it would have received had that Relevant Tax or those amounts in respect of Relevant Tax not been so deducted or withheld.

 

11.2                    Indemnity

 

Save to the extent that the relevant Finance Party is compensated by an increased payment under Clause 11.1 (Gross-up), but otherwise without prejudice to the provisions of Clause 11.1 (Gross-up), but subject to Clause 11.4 (Qualifying Lenders) and Clause 11.5 (U.S. Taxes), if a Finance Party or the Agent (or, as the case may be, the U.S. Swingline Agent) on behalf of that Finance Party is required to make any payment on account of any Relevant Tax on or in relation to any sum received or receivable hereunder by such Finance Party or the Agent (or, as the case may be, the U.S. Swingline Agent) on behalf of that Finance Party (including a sum received or receivable under this Clause 11) or any liability in respect of any such payment on account of any Relevant Tax is incurred by such Finance Party or the Agent (or, as the case may be, the U.S. Swingline Agent) on behalf of that Finance Party (in all cases other than any Tax on Overall Net Income or any FATCA Deduction), the relevant Obligor shall, within five Business Days of demand by the Agent (or, as the case may be, the U.S. Swingline Agent) indemnify such Finance Party against such payment or liability in respect of such payment, together with any interest, penalties, reasonable costs and reasonable expenses payable or incurred in connection therewith other than any such interest, penalties, costs or expenses arising as a result of a failure by a Finance Party to make payment of such tax when due.

 

11.3                    Tax receipts

 

All taxes required by law to be deducted or withheld by an Obligor from any amounts paid or payable under the Finance Documents shall be paid by the relevant Obligor when due and the Obligor shall, within 15 days of the payment being made, deliver to the Agent for the relevant Lender evidence satisfactory to that Lender acting reasonably (including any relevant tax receipts which have been received) that the payment has been duly remitted to the appropriate authority.

 

11.4                    Qualifying Lenders

 

(a)                               An Obligor is not required to pay to a Lender any amounts under Clause 11.1 (Gross-up) or Clause 11.2 (Indemnity) in respect of Relevant Tax imposed by the United Kingdom if, on the date on which the payment falls due, the relevant Lender is a Party but is not a Qualifying Lender (other than as a result of the introduction, suspension, withdrawal or cancellation of, or change in, or change in the official interpretation, administration or official application of, any law, regulation having the force of law, tax treaty or any published practice or published concession of any relevant taxing authority in any jurisdiction with which the relevant Lender has a

 

53

 

connection, occurring after the Signing Date or, if later, the date on which that Lender becomes a Party).

 

(b)                              A Treaty Lender shall:

 

(i)                                  promptly and, in any event, within seven Business Days after it becomes a Lender, deliver to its local revenue authority for certification such UK HMRC forms (“Claim Forms”) as may be required for any Obligor making a payment to such Treaty Lender to obtain authorisation from the UK HMRC to make such payment without deduction for or on account of any taxes;

 

(ii)                              in circumstances where the procedure for Treaty relief contemplated in paragraph (i) above requires a local revenue authority to return a certified Claim Form to the Treaty Lender for submission by that Treaty Lender to the UK HMRC, (a) take all reasonable follow up action available to the Treaty Lender to facilitate the return in a timely manner to the Treaty Lender of such Claim Form, duly stamped or certified by the relevant revenue authority and (b) submit such Claim Form to the UK HMRC as soon as reasonably practicable (and in any event within seven Business Days) after receipt of that Claim Form from the local revenue authority; and

 

(iii)                          in all other circumstances relating to the Treaty relief procedure contemplated in (i) above, following the submission of Claim Forms by the Treaty Lender to the relevant local revenue authority, respond promptly to any further requests any Treaty Lender receives from the relevant local revenue authority and, on receipt of written request from Vodafone to do so, take all reasonable follow up action to facilitate the submission by the relevant local revenue authority of duly stamped or certified Claim Forms to the UK HMRC in a timely manner.

 

If there is any change in the procedure by which certification is to be made or to be notified to the UK HMRC, the Treaty Lender’s obligations shall be modified in such manner as the Treaty Lender may reasonably determine so that such amended obligations shall, as far as possible, have the same or equivalent effect as the original obligations. No Obligor resident in the UK shall be liable to pay any sums to any Treaty Lender under Clause 11.1 (Gross-up) or Clause 11.2 (Indemnity) unless the Treaty Lender has complied with its obligations under this Clause 11.4(b).

 

(c)                               Subject to paragraph (d) below, each Lender warrants to Vodafone, on each date upon which it makes an Advance and on the due date for each payment of interest to the Lender:

 

(i)                                  that it is a Qualifying Lender; and

 

(ii)                              if it is a Treaty Lender, it has delivered (or will deliver within the time limits specified herein) the forms described in paragraph (b) above.

 

(d)                              If a Lender or, as the case may be, the Facility Office of a Lender is aware that it is or will become unable to make the warranty set out in paragraph (c) above of this Clause 11.4 it will promptly notify the Agent and Vodafone. Notwithstanding such notification to Vodafone, the Agent will promptly notify Vodafone and from the date of the first such notification received by Vodafone the warranty in paragraph (c) above will no longer be made by that Lender.

 

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11.5                    U.S. Taxes

 

(a)                               A U.S. Tax Obligor shall not be required to pay any amount pursuant to Clause 11.1 (Gross-up) or any amount pursuant to Clause 11.2 (Indemnity) in respect of Relevant Tax imposed by the United States (including, without limitation, federal, state, local or other income taxes, branch profits or franchise taxes “U.S. Taxes”) with respect to a sum payable by it pursuant to this Agreement to a Lender if on the date a payment of interest falls due under this Agreement either:

 

(i)                                  in the case of a Lender which is not a United States person (as such term is defined in Section 7701(a)(30) of the Code), such Lender is not entitled to receive interest payable under this Agreement free and clear of any U.S. Taxes imposed by way of deduction or withholding at the source under applicable law as in effect on the date such Lender becomes a party to this Agreement or, if such Lender has designated a new Facility Office, the date of such designation; or

 

(ii)                              such Lender has failed to provide the relevant U.S. Tax Obligor with the appropriate form, certificate or other information with respect to such sum payable that it was required to provide pursuant to paragraphs (b) and (c) below; or

 

(iii)                          such Lender is subject to such tax by reason of any connection between the Lender or its Facility Office and the jurisdiction imposing such tax on the Lender or its Facility Office other than a connection arising solely from this Agreement or any transaction contemplated hereby.

 

(b)                              At any time after a U.S. Tax Obligor becomes (and while there continues to be a U.S. Tax Obligor) a Party to this Agreement, if a Lender is not a United States person (as such term is defined in Section 7701(a)(30) of the Code) it shall submit, as soon as reasonably practicable after:

 

(i)                                  the date on which the U.S. Tax Obligor becomes a Party to this Agreement (if requested by the relevant U.S. Tax Obligor);

 

(ii)                              the date on which the relevant Lender becomes a Party to this Agreement; or

 

(iii)                          the date on which the relevant Lender designates a new Facility Office,

 

(but, in each case, no later than the due date for the next interest payment), in duplicate to each U.S. Tax Obligor duly completed and signed originals of either United States Internal Revenue Service Form W-8BEN or Form W-8ECI or applicable successor form relating to such Lender and evidencing such Lender’s complete exemption from withholding on all amounts (to which such withholding would otherwise apply) to be received by such Lender, including fees, pursuant to this Agreement in connection with any borrowing by a U.S. Tax Obligor. Thereafter such Lender shall submit to each U.S. Tax Obligor such additional duly completed and signed originals of one or the other such forms (or such successor forms as shall be adopted from time to time by the relevant United States taxation authorities) or any additional information, in each case as may be required under then current United States law or regulations to claim the inapplicability of or exemption from United States withholding taxes on payments in respect of all amounts (to which such withholding would otherwise apply) to be received by such Lender, including fees, pursuant to this Agreement in connection with any borrowing by a U.S. Tax Obligor unless such Lender is unable to do so as a result of a change in, the introduction of, suspension, withdrawal or cancellation of, or

 

55

 

change in the official interpretation, administration or official application of, the Code or any regulation promulgated thereunder or of a convention or agreement for the avoidance of double taxation and the prevention of fiscal evasion between the government of the United States and the jurisdiction in which the relevant Lender has a connection, occurring after the date the Lender becomes a Party to this Agreement or, if such Lender has designated a new Facility Office, the date of such designation.

 

(c)                               At any time after a U.S. Tax Obligor becomes (and while there continues to be a U.S. Tax Obligor) a Party to this Agreement, if a Lender is a United States person (as such term is defined in Section 7701(a)(30) of the Code) it shall, as soon as practicable after:

 

(i)                                  the date on which the U.S. Tax Obligor becomes a Party to this Agreement (if requested by the relevant U.S. Tax Obligor);

 

(ii)                              the date on which the relevant Lender becomes a Party to this Agreement; or

 

(iii)                          the date on which the relevant Lender designates a new Facility Office,

 

(but, in each case, no later than the due date for the next interest payment), and thereafter, on or before the date that any such form expires or becomes obsolete or after the occurrence of any event requiring a change in the most recent form or forms to be delivered, submit in duplicate to each U.S. Tax Obligor a duly completed and signed United States Internal Revenue form W-9 evidencing that such Lender is such a United States person and shall submit any additional information that may be necessary to avoid United States withholding taxes on all payments, including fees, (to which such withholding would otherwise apply) to be received pursuant to this Agreement in connection with any borrowing by a U.S. Tax Obligor.

 

11.6                    Refund of Tax Credits

 

If any Obligor pays any amount to a Finance Party under this Clause 11 (a “Tax Payment”) and that Finance Party obtains a refund of a tax, or a credit against tax by reason of either the circumstances giving rise to the Obligor’s obligation to make the Tax Payment or that Tax Payment (a “Tax Credit”) then that Finance Party shall reimburse that Obligor such amount, which that Finance Party determines in good faith, as can be determined to be the proportion of the Tax Credit as will leave that Finance Party (after that reimbursement) in no better or worse position than it would have been in if the Tax Payment had not been paid. Nothing in this Clause 11 shall interfere with the right of each Finance Party to arrange its affairs in whatever manner it thinks fit and no Finance Party is obliged to disclose any information regarding its tax affairs or computations to an Obligor which it reasonably considers confidential.

 

11.7                    FATCA Information

 

(a)                               Subject to paragraph (c) below, each Party must, within ten Business Days of a reasonable request by another Party;

 

(i)                                  confirm to that other Party whether it is:

 

(A)                           a FATCA Exempt Party; or

 

(B)                            not a FATCA Exempt Party; and

 

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(ii)                              supply to that other Party such forms, documentation and other information relating to its status under FATCA as that other Party reasonably requests for the purposes of that other Party’s compliance with FATCA.

 

(b)                              If a Party confirms to another Party pursuant to paragraph (a)(i) above that it is a FATCA Exempt Party and it subsequently becomes aware that it is not, or has ceased to be a FATCA Exempt Party, that Party must notify that other Party reasonably promptly.

 

(c)                               Paragraph (a) above shall not oblige any Party to do anything, which would or might in its reasonable opinion constitute a breach of:

 

(i)                                  any law or regulation;

 

(ii)                              any fiduciary duty; or

 

(iii)                          any duty of confidentiality.

 

(d)                              If a Party fails to confirm whether or not it is a FATCA Exempt Party or to supply forms, documentation or other information requested in accordance with paragraph (a)(i) or (ii) above (including, for the avoidance of doubt, where paragraph (c) above applies), then such Party is to be treated for the purposes of the Finance Documents (and payments made under them) as if it is a not a FATCA Exempt Party until such time as the Party in question provides the requested confirmation, forms, documentation or other information.

 

(e)                               If a Borrower is a U.S. Tax Obligor, or where the Agent or, as the case may be the U.S. Swingline Agent, reasonably believes that its obligations under FATCA require it, each Lender shall, within ten Business Days of:

 

(i)                                  where a Borrower is a U.S. Tax Obligor and the relevant Lender is an Original Lender, the date of this Agreement;

 

(ii)                              where a Borrower is a U.S. Tax Obligor and the relevant Lender is a New Lender, the relevant Transfer Date;

 

(iii)                          the date a new U.S. Tax Obligor accedes as a Borrower; or

 

(iv)                          where the Borrower is not a U.S. Tax Obligor, the date of a request from the Agent or, as the case may be, the U.S. Swingline Agent,

 

supply to the Agent or, as the case may be, the U.S. Swingline Agent:

 

(v)                              a withholding certificate on Form W-8 or Form W-9 (or any successor form) (as applicable); or

 

(vi)                          any withholding statement and other documentation, authorisations and waivers as the Agent or, as the case may be, the U.S. Swingline Agent, may require to certify or establish the status of such Lender under FATCA.

 

The Agent shall provide any withholding certificate, withholding statement, documentation, authorisations and waivers it receives from a Lender pursuant to this paragraph (e) to the Borrower and shall be entitled to rely on any such withholding certificate, withholding statement, documentation, authorisations and waivers provided without further verification.

 

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The Agent or, as the case may be, the U.S. Swingline Agent, shall not be liable for any action taken by it under or in connection with this paragraph (e).

 

(f)         Each Lender agrees that if any withholding certificate, withholding statement, documentation, authorisations and waivers provided to the Agent, or, as the case may be, the U.S. Swingline Agent, pursuant to paragraph (e) above is or becomes materially inaccurate or incomplete, it shall promptly update it and provide such updated withholding certificate, withholding statement, documentation, authorisations and waivers to the Agent unless it is unlawful for the Lender to do so (in which case the Lender shall promptly notify, in writing, the Agent, or, as the case may be, the U.S. Swingline Agent). The Agent, or, as the case may be, the U.S. Swingline Agent, shall provide any such updated withholding certificate, withholding statement, documentation, authorisations and waivers or a copy of any such notification to the Borrower. The Agent, or, as the case may be, the U.S. Swingline Agent, shall not be liable for any action taken by it under or in connection with paragraphs (e) or (f).

 

11.8                    Other information

 

(a)                               Subject to paragraph (b) below, each Party must, within ten Business Days of a reasonable request by another Party, supply to that other Party such forms, documentation and other information relating to its status as that other Party requests to enable that other Party to comply with any regulations made under section 222 of the Finance Act 2013 or any other applicable law or regulation implementing any similar international arrangements for the exchange of Tax or financial information between jurisdictions.

 

(b)                              No Party is obliged to do anything under paragraph (a) above which would or might in its reasonable opinion constitute a breach of any applicable:

 

(i)                                  law or regulation;

 

(ii)                              fiduciary duty; or

 

(iii)                          duty of confidentiality.

 

11.9                    FATCA Deduction

 

(a)                               Each Party may make any FATCA Deduction it is required to make by FATCA, and any payment required in connection with that FATCA Deduction, and no Party is required to increase any payment in respect of which it makes such FATCA Deduction or otherwise compensate the recipient of the payment for that FATCA Deduction.

 

(b)                              Each Party must, promptly upon becoming aware that it must make a FATCA Deduction (or that there is any change in the rate or the basis of such FATCA Deduction), notify the Party to whom it is making the payment and, in addition, must notify Vodafone, the Agent, or, as the case may be, the U.S. Swingline Agent and the Agent shall notify the other Finance Parties.

 

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12.                            MARKET DISRUPTION

 

12.1                    Market disturbance

 

Notwithstanding anything to the contrary herein contained, if and each time that prior to or on a Drawdown Date relative to an Advance (other than, in the case of paragraphs (a), (b)(ii) or (c) below, a Swingline Advance) to be made:

 

(a)                               only one or no Reference Bank supplies a rate for the purposes of determining LIBOR or EURIBOR (as the case may be) in accordance with paragraph (c) of the relevant definition; or

 

(b)                              the Agent is notified by Lenders whose participations in that Advance would represent 50 per cent. or more of that Advance that (i) deposits in the currency of that Advance may not in the ordinary course of business be available to them in the Relevant Interbank Market for a period equal to the Term concerned in amounts sufficient to fund their participations in that Advance or (ii) the cost to it of obtaining matching deposits in the Relevant Interbank Market would be in excess of EURIBOR or LIBOR; or

 

(c)                               the Agent (after consultation with the Reference Banks) shall have determined (which determination shall be conclusive and binding upon all Parties) that by reason of circumstances affecting the Relevant Interbank Market generally, adequate and fair means do not exist for ascertaining the LIBOR or EURIBOR (as the case may be) applicable to such Advance during its Term,

 

the Agent shall promptly give written notice of such determination or notification to Vodafone and to each of the Lenders.

 

12.2                    Alternative rates

 

If the Agent gives a notice under Clause 12.1 (Market disturbance):

 

(a)                               Vodafone and the Lenders whose participations in the relevant Advance would represent 50 per cent. or more of that Advance may (through the Agent) agree that (except in the case of a Rollover Advance) that Advance shall not be borrowed; or

 

(b)                              in the absence of such agreement by the Drawdown Date specified in the relevant Request (and in any event in the case of a Rollover Advance):

 

(i)                                  the Term of the relevant Advance shall be one month;

 

(ii)                              the Advance shall be made in the currency requested or, in the case of Clause 12.1(b)(i) (Market disturbance), in U.S. Dollars (or, if the currency requested for the relevant Advance is U.S. Dollars, euro); and

 

(iii)                          during the Term of the relevant Advance the rate of interest applicable to such Advance shall be the Margin plus the rate per annum notified by each Lender concerned to the Agent before the last day of such Term to be that which expresses as a percentage rate per annum the cost to such Lender of funding its participation in such Advance from whatever sources it may reasonably select.

 

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13.                            INCREASED COSTS

 

13.1                    Increased costs

 

(a)                               Except as provided below in this Clause 13, Vodafone will forthwith on demand by a Finance Party pay that Finance Party the amount of any increased cost incurred by it or any of its Affiliates as a result of

 

(i)                                  the introduction of or any change in (or in the interpretation, administration or application of) any law or regulation (including any relating to reserve asset, special deposit, cash ratio, liquidity or capital adequacy requirements or any other form of banking or monetary control) ;

 

(ii)                              the compliance with any law or regulation made after the date of this Agreement; or

 

(iii)                          without prejudice to the generality of the foregoing, the implementation or application of or compliance with Basel III or CRD IV or any other law or regulation which implements Basel III or CRD IV (whether such implementation, application or compliance is by a government, regulator, Finance Party or any of its Affiliates)

 

(b)                              Subject to Clause 13.3 (Basel III cost claims), promptly following the service of any demand, Vodafone will pay to that Finance Party such amount as that Finance Party certifies in the demand (with sufficient details for the calculations to be verified) will in its reasonable opinion compensate it for the applicable increased cost and in relation to the period expressed to be covered by such demand.

 

(c)                               When calculating an increased cost, a Finance Party will only apply the costs incurred in relation to the Facilities. Nothing contained in this Clause 13.1 shall oblige the Finance Party to disclose any information (other than information which is readily available in the public domain or which is not in the reasonable opinion of the Finance Party confidential) relating to the way in which it employs its capital or arranges its internal financial affairs.

 

(d)                              In this Agreement “increased cost” means:

 

(i)                                  an additional cost incurred by a Finance Party or any of its Holding Companies as a result of it performing, maintaining or funding its obligations under, this Agreement; or

 

(ii)                              that portion of an additional cost incurred by a Finance Party or any of its Holding Companies in making, funding or maintaining all or any advances comprised in a class of advances formed by or including its participations in the Advances made or to be made under this Agreement as is attributable to it making, funding or maintaining its participations; or

 

(iii)                          a reduction in any amount payable to a Finance Party or the effective return to a Finance Party under this Agreement or on its capital (or the capital of any of its Holding Companies); or

 

(iv)                          the amount of any payment made by a Finance Party, or the amount of interest or other return foregone by a Finance Party, calculated by reference

 

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to any amount received or receivable by a Finance Party from any other Party under this Agreement.

 

13.2                    Exceptions

 

Clause 13.1 (Increased costs) does not apply to any increased cost:

 

(a)                               attributable to any tax or amounts in respect of tax; or

 

(b)                              occurring as a result of any negligence or default by a Lender or its Holding Company relating to a breach of any law or regulation including but not limited to a breach by that Lender or Holding Company of any fiscal, monetary or capital adequacy limit imposed on it by any law or regulation; or

 

(c)                               to the extent that the increased cost was incurred in respect of any day more than six months before the first date on which it was reasonably practicable to notify Vodafone thereof (except in the case of any retrospective change); or

 

(d)                              attributable to the implementation or application of or compliance with the “International Convergence of Capital Measurement and Capital Standards, a Revised Framework” published by the Basel Committee on Banking Supervision in June 2004 in the form existing on the date of this Agreement (“Basel II”) or any other law or regulation which implements Basel II (whether such implementation, application or compliance is by a government, regulator, Finance Party or any of its Affiliates). For the avoidance of doubt, the foregoing shall not include any amendments, supplements, restatements or changes to Basel II to implement Basel III; or

 

(e)                               attributable to a FATCA Deduction required to be made by a Party.

 

13.3                    Basel III Cost claims

 

(a)                               Vodafone need not make any payment for a Basel III Cost, except to the extent that the Basel III Cost is attributable to an amount of an Advance(s) which has been drawn at any time by an Obligor under this Agreement.

 

(b)                              Without limiting Clause 13.2 (Exceptions) Vodafone need not make any payment for a Basel III Cost unless the claiming Finance Party:

 

(i)                                  provides reasonable detail of the basis of calculation of such Basel III Costs provided that this obligation to provide reasonable detail does not extend to information and detail that a Finance Party considers it is not legally allowed to disclose, is confidential to third parties, is confidential for internal reasons or is price-sensitive in relation to listed shares or other instruments issued by that Finance Party or any of its Affiliates;

 

(ii)                              confirms to Vodafone that it is the Finance Party’s policy to claim Basel III Costs to a similar extent from similar borrowers in relation to similar facilities; and

 

(iii)                          confirms to Vodafone that it is making a claim for those Basel III Costs within three months of incurring them.

 

(c)                               If any claim by any Finance Party is made under this Clause 13 (Increased Costs) in respect of Basel III Costs, that Finance Party and Vodafone shall enter into

 

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discussions (for a period not exceeding 15 Business Days) as to the basis for such claim and whether it is reasonable for Vodafone to pay such claim in the circumstances.

 

(d)                              If no agreement is reached in respect of the payment of such claim within 15 Business Days of the claim being made, the relevant Finance Party may, within 15 Business Days after the end of such period and by ten Business Days’ prior notice to Vodafone:

 

(i)                                  cancel its Commitments with immediate effect; and

 

(ii)                              demand the prepayment of its share of all Advances then outstanding together with accrued interest thereon and all other amounts accrued under the Finance Documents.

 

(e)                               On the expiry of the ten Business Days’ notice period referred to in paragraph (d) above, Vodafone (or, if applicable, the relevant Borrower) shall pay to the Agent for that Finance Party:

 

(i)                                  the participations of that Lender in all outstanding Advances together with accrued interest;

 

(ii)                              the increased costs originally claimed by that Lender and the increased costs continuing to be incurred by it for the period until payment by Vodafone in full under this Clause 13.3 (Basel III Cost claims);

 

(iii)                          any amounts payable pursuant to Clause 24.3 (Breakage Costs); and

 

(iv)                          all amounts owing to that Finance Party under the Finance Documents.

 

14.                            ILLEGALITY AND MITIGATION

 

14.1                    Illegality

 

If it becomes unlawful in any jurisdiction for a Lender to give effect to any of its obligations as contemplated by this Agreement or to fund or maintain its participation in any Advance, then the Lender may notify Vodafone through the Agent accordingly and thereupon, but only to the extent necessary to remove the illegality:

 

(a)                               the Lender’s Available Commitment shall be cancelled immediately; and

 

(b)                              to the extent that the Lender’s participation has not been transferred pursuant to Clause 27.5 (Replacement of Lenders), each Borrower shall, upon request from that Lender within the period allowed or if no period is allowed, forthwith, repay any participation of that Lender in the Advances made to it together with all other amounts payable by it to that Lender under this Agreement and that Lender’s Commitment shall be cancelled immediately in the amount of the participations repaid.

 

14.2                    Mitigation

 

Notwithstanding the provisions of Clauses 9.1 (Interest rate for all Advances), 11 (Taxes), 13 (Increased Costs) and 14.1 (Illegality), if in relation to a Finance Party circumstances arise which would result in:

 

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(a)                               any deduction, withholding or payment of the nature referred to in Clause 11 (Taxes); or

 

(b)                              any increased cost of the nature referred to in Clause 13 (Increased Costs); or

 

(c)                               a notification pursuant to Clause 14.1 (Illegality),

 

then without in any way limiting, reducing or otherwise qualifying the rights of such Finance Party or the Agent, such Finance Party shall promptly upon becoming aware of the same notify the Agent thereof (whereupon the Agent shall promptly notify Vodafone) and such Finance Party shall use reasonable endeavours to transfer its participation in the Facility and its rights hereunder and under the Finance Documents to another financial institution or Facility Office not affected by circumstances having the results set out in paragraphs (a), (b) or (c) above and shall otherwise take such reasonable steps as may be open to it to mitigate the effects of such circumstances provided that such Finance Party shall not be under any obligation to take any such action if, in its opinion, to do so would or would be likely to have a material adverse effect upon its business, operations or financial condition or would involve it in any unlawful activity or any activity that is contrary to its policies or any request, guidance or directive of any competent authority (whether or not having the force of law) or (unless indemnified to its satisfaction) would involve it in any significant expense or tax disadvantage.

 

15.                            GUARANTEE

 

15.1                    Guarantee

 

Each Guarantor jointly and severally, irrevocably and unconditionally:

 

(a)                               as principal obligor, guarantees to each Finance Party that if and whenever:

 

(i)                                  an amount is due and payable by a Borrower under or in connection with any Finance Document; and

 

(ii)                              demand for payment of that amount has been made by the Agent on that Borrower,

 

that Guarantor will forthwith on demand by the Agent pay that amount as if that Guarantor instead of that Borrower were expressed to be the principal obligor; and

 

(b)                              indemnifies each Finance Party on demand against any loss or liability suffered by it if any obligation guaranteed by any Guarantor is or becomes unenforceable, invalid or illegal (the amount of that loss being the amount expressed to be payable by the relevant Borrower in respect of the relevant sum).

 

15.2                    Continuing guarantee

 

This guarantee is a continuing guarantee and will extend to the ultimate balance of all sums payable by the Borrowers under the Finance Documents, regardless of any intermediate payment or discharge in part.

 

15.3                    Reinstatement

 

(a)                               Where any discharge (whether in respect of the obligations of any Borrower or any security for those obligations or otherwise) is made in whole or in part or any

 

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arrangement is made on the faith of any payment, security or other disposition which is avoided or must be restored on insolvency, liquidation or otherwise without limitation, the liability of the Guarantors under this Clause 15 shall continue as if the discharge or arrangement had not occurred (but only to the extent that such payment, security or other disposition is avoided or restored).

 

(b)                              Each Finance Party may concede or compromise any claim that any payment, security or other disposition is liable to avoidance or restoration.

 

15.4                    Waiver of defences

 

The obligations of each Guarantor under this Clause 15 will not be affected by any act, omission, matter or thing which, but for this provision, would reduce, release or prejudice any of its obligations under this Clause 15 or prejudice or diminish those obligations in whole or in part, including (whether or not known to it or any Finance Party):

 

(a)                               any time or waiver granted to, or composition with, any Borrower or other person;

 

(b)                              the release of any other Obligor or any other person under the terms of any composition or arrangement with any creditor of any member of the Consolidated 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, any Obligor 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 a Borrower or any other person;

 

(e)                               any variation (however fundamental) or replacement of a Finance Document so that references to that Finance Document in this Clause 15 shall include each variation or replacement;

 

(f)                                any unenforceability, illegality or invalidity of any obligation of any person under any Finance Document, to the intent that the Guarantors’ obligations under this Clause 15 shall remain in full force and its guarantee be construed accordingly, as if there were no unenforceability, illegality or invalidity; and

 

(g)                               any postponement, discharge, reduction, non-provability or other similar circumstance affecting any obligation of any Borrower under a Finance 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 the Guarantors’ obligations under this Clause 15, be construed as if there were no such circumstance.

 

15.5                    Immediate recourse

 

Except as provided in Clause 15.1(a)(ii) (Guarantee), each Guarantor waives any right it may have of first requiring any Finance Party (or any trustee or agent on its behalf) to proceed against or enforce any other rights or security or claim payment from any person before claiming from that Guarantor under this Clause 15.

 

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15.6                    Appropriations

 

Until all amounts which may be or become payable by the Borrowers under or in connection with the Finance Documents have been irrevocably paid in full, each Finance Party (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 that Finance Party (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 no Guarantor shall be entitled to the benefit of the same; and

 

(b)                              hold in a suspense account (bearing interest at a commercial rate) any moneys received from any Guarantor or on account of that Guarantor’s liability under this Clause 15, with any interest earned being credited to that account.

 

15.7                    Non-competition

 

Until all amounts which may be or become payable by the Borrowers under or in connection with the Finance Documents have been paid in full, no Guarantor shall, after a claim has been made or by virtue of any payment or performance by it under this Clause 15:

 

(a)                               be subrogated to any rights, security or moneys held, received or receivable by any Finance Party (or any trustee or agent on its behalf) or be entitled to any right of contribution or indemnity in respect of any payment made or moneys received on account of that Guarantor’s liability under this Clause 15; or

 

(b)                              claim, rank, prove or vote as a creditor of any Borrower or its estate in competition with any Finance Party (or any trustee or agent on its behalf); or

 

(c)                               receive, claim or have the benefit of any payment, distribution or security from or on account of any Borrower, or exercise any right of set-off as against any Borrower.

 

Each Guarantor shall hold in trust for and forthwith pay or transfer to the Agent for the Finance Parties any payment or distribution or benefit of security received by it contrary to this Clause 15.7.

 

15.8                    Additional security

 

This guarantee is in addition to and is not in any way prejudiced by any other security now or hereafter held by any Finance Party.

 

15.9                    Removal of Guarantors

 

(a)                               Any Guarantor (other than, Vodafone (subject to paragraph (b) below) and, following the Reorganisation Date, NewTopco and any Intermediate Holding Company (subject to paragraph (c) below) of Vodafone) which is not a Borrower, may, at the request of Vodafone and if no Default is continuing, cease to be a Guarantor by entering into a supplemental agreement to this Agreement at the cost of Vodafone in such form as the Agent may reasonably require which shall discharge that Guarantor’s obligations as a Guarantor under this Agreement.

 

(b)                              If on the Reorganisation Date, NewTopco or any Intermediate Holding Company have acceded as Guarantors in accordance with Clause 27.7 (Additional Guarantors)

 

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and no Default is continuing or would result from Vodafone’s resignation as a Guarantor, Vodafone may cease to be a Guarantor with effect from the Reorganisation Date by entering into a supplemental agreement to this Agreement at the cost of Vodafone or NewTopco in such form as the Agent may reasonably require which shall discharge Vodafone’s obligations as a Guarantor under this Agreement.

 

(c)                               If NewTopco has acceded as a Guarantor in accordance with Clause 27.7 (Additional Guarantors) and no Default is continuing or would result from Intermediate Holding Company’s resignation as a Guarantor, Intermediate Holding Company may cease to be a Guarantor by entering into a supplemental agreement to this Agreement at the cost of Vodafone or NewTopco in such form as the Agent may reasonably require which shall discharge Intermediate Holding Company’s obligation as a Guarantor under this Agreement.

 

(d)                              Any Party retiring as a Guarantor in accordance with paragraphs (a), (b) or (c) above (a “Retiring Guarantor”) for the purpose of any sale or other disposal of that Retiring Guarantor then on the date such Retiring Guarantor ceases to be a Guarantor:

 

(i)                                  that Retiring Guarantor is released by each other Guarantor from any liability (whether past, present or future and whether actual or contingent) to make a contribution to any other Guarantor arising by reason of the performance by any other Guarantor of its obligations under the Finance Documents; and

 

(ii)                              each other Guarantor waives any rights it may have by reason of the performance of its obligations under the Finance Documents to take the benefit (in whole or in part and whether by way of subrogation or otherwise) of any rights of the Finance Parties under any Finance Document or of any other security taken pursuant to, or in connection with, any Finance Document where such rights or security are granted by or in relation to the assets of the Retiring Guarantor.

 

15.10            Limitation on guarantee of U.S. Guarantors

 

Notwithstanding any other provision of this Clause 15, the obligations of each Guarantor incorporated in the United States (other than NewTopco and any Intermediate Holding Company, to the extent incorporated in the United States) (a “U.S. Guarantor”) under this Clause 15 shall be limited to a maximum aggregate amount equal to the largest amount that would not render its obligations hereunder subject to avoidance as a fraudulent transfer or conveyance under Section 548 of Title 11 of the United States Bankruptcy Code or any applicable provisions of comparable state law (collectively, the “Fraudulent Transfer Laws”), in each case after giving effect to all other liabilities of such U.S. Guarantor, contingent or otherwise, that are relevant under the Fraudulent Transfer Laws (specifically excluding, however, any liabilities of such U.S. Guarantor in respect of intercompany indebtedness to the Borrowers or Affiliates of the Borrowers to the extent that such indebtedness would be discharged in an amount equal to the amount paid by such U.S. Guarantor hereunder) and after giving effect as assets to the value (as determined under the applicable provisions of the Fraudulent Transfer Laws) of any rights to subrogation, contribution, reimbursement, indemnity or similar rights of such U.S. Guarantor pursuant to (a) applicable law or (b) any agreement providing for an equitable allocation among such U.S. Guarantor and other Affiliates of the Borrowers of obligations arising under guarantees by such parties.

 

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16.                            REPRESENTATIONS AND WARRANTIES

 

16.1                    Representations and warranties

 

Each Obligor makes the representations and warranties set out in this Clause 16 to each Finance Party (in respect of itself and where relevant its Controlled Subsidiaries only).

 

16.2                    Status

 

(a)                               It is a duly incorporated and validly existing corporation under the laws of the jurisdiction of its incorporation.

 

(b)                              Except to the extent specified in the applicable Borrower Accession Agreement or Guarantor Accession Agreement, each Obligor is classified as a corporation for U.S. federal income tax purposes.

 

16.3                    Powers and authority

 

It has the power to:

 

(a)                               enter into and comply with, all obligations expressed on its part under the Finance Documents;

 

(b)                              (in the case of a Borrower) to borrow under this Agreement; and

 

(c)                               (in the case of a Guarantor) to give the guarantee in Clause 15 (Guarantee),

 

and has taken all necessary actions to authorise the execution, delivery and performance of the Finance Documents.

 

16.4                    Non-violation

 

The execution, delivery and performance of the Finance Documents will not violate:

 

(a)                               any provisions of any existing law or regulation or statute applicable to it; or

 

(b)                              to any material extent, any provisions of any mortgage, contract or other undertaking to which it or any of its Controlled Subsidiaries which is a member of the Restricted Group is a party or which is binding upon it or any of its Controlled Subsidiaries which is a member of the Restricted Group, the consequences of which would have a material adverse effect on the ability of the Obligors (taken as a whole) to perform their material obligations under the Finance Documents.

 

16.5                    Borrowing limits

 

Borrowings under this Agreement up to and including the maximum amount available under this Agreement, together with borrowings under the 2019 Facility up to and including the maximum amount available under the 2019 Facility, will not cause any limit (except to the extent the limit has been waived) on borrowings or, as the case may be, on the giving of guarantees (whether imposed in its Articles of Association or otherwise), or on the powers of its board of directors, applicable to it to be exceeded.

 

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16.6                    Authorisations

 

All necessary consents or authorisations of any governmental authority or agency required by it in connection with the execution, validity, performance or enforceability of the Finance Documents have been obtained and are validly existing.

 

16.7                    No default

 

Neither it nor any of its Controlled Subsidiaries which is a member of the Restricted Group is in default under any law or agreement by which it is bound the consequences of which would have a material adverse effect on the ability of the Obligors (taken as a whole) to perform their payment obligations under the Finance Documents.

 

16.8                    Accounts

 

The audited consolidated financial statements of Vodafone (or, following a Hive Up, NewTopco) most recently delivered to the Agent (which, at the date of this Agreement are the audited consolidated accounts of Vodafone for the year ended 31 March 2014)):

 

(a)                               give a true and fair view of the consolidated financial position of Vodafone (or, following a Hive Up, NewTopco) as at the date to which they were drawn up; and

 

(b)                              have been prepared in accordance with generally accepted accounting principles applied by Vodafone (or, following a Hive Up, NewTopco) at such time, consistently applied except for changes disclosed in such financial statements which are necessary to reflect a change in generally accepted accounting principles or the adoption of international finance reporting standards.

 

16.9                    No Event of Default

 

No Event of Default has occurred and is continuing in respect of it or any of its Subsidiaries which is a member of the Restricted Group.

 

16.10            Investment Company

 

Each Borrower which is a U.S. Obligor either (i) is not an investment company as defined under United States Investment Company Act of 1940, as amended, or (ii) is exempt from the registration provisions of the Act pursuant to an exemption under that Act.

 

16.11            ERISA

 

(a)                               Each member of the Controlled USA Group has fulfilled its obligations under the minimum funding standards of ERISA and the Code with respect to each Plan maintained by such member or any member of the Controlled USA Group where non-fulfilment of such obligations would have a material adverse effect on the ability of the Obligors (taken as a whole) to perform their payment obligations under the Finance Documents.

 

(b)                              Each Obligor is in compliance with the applicable provisions of ERISA, the Code and any other applicable United States Federal or State law with respect to each Plan maintained by such Obligor where non-fulfilment of or non-compliance with such provisions would have a material adverse effect on the ability of the Obligors (taken as a whole) to perform their payment obligations under the Finance Documents.

 

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(c)                               No Reportable Event has occurred with respect to any Plan maintained by an Obligor or any member of the Controlled USA Group and no steps have been taken to reorganise or terminate any Single Employer Plan or by that Obligor to effect a complete or partial withdrawal from any Multi-employer Plan where non-compliance or such Reportable Event, reorganisation, termination or withdrawal would have a material adverse effect on the ability of the Obligors (taken as a whole) to perform their payment obligations under the Finance Documents.

 

(d)                              No member of the Controlled USA Group has:

 

(i)                                  sought a waiver of the minimum funding standard under Section 412 of the Code in respect of any Plan; or

 

(ii)                              failed to make any contribution or payment to any Single Employer Plan or Multi-employer Plan, or made any amendment to any Plan, and no other event, transaction or condition has occurred which has resulted or would result in the imposition of a lien or the posting of a bond or other security under ERISA or the Code; or

 

(iii)                          incurred any material, actual liability under Title I or Title IV of ERISA other than a liability to the PBGC for premiums under Section 4007 of ERISA,

 

if such seeking, failure or incurrence would have a material adverse effect on the ability of the Obligors (taken as a whole) to perform their payment obligations under the Finance Documents.

 

16.12            Anti-Terrorism Laws

 

In this Clause 16.12,

 

Anti-Terrorism Law means each of:

 

(a)                               Executive Order No. 13224 on Terrorist Financing: Blocking Property and Prohibiting Transactions With Persons Who Commit, Threaten To Commit, or Support Terrorism issued September 23, 2001, as amended by Order 13268 (as so amended, the Executive Order);

 

(b)                              the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001, Public Law 107-56 (commonly known as the USA Patriot Act) (the USA Patriot Act);

 

(c)                               the Money Laundering Control Act of 1986, 18 U.S.C. sect. 1956; and

 

(d)                              any similar law enacted in the United States subsequent to the date of this Agreement.

 

Restricted Party means any person listed:

 

(a)                               in the Annex to the Executive Order;

 

(b)                              on the “Specially Designated Nationals and Blocked Persons” list maintained by the Office of Foreign Assets Control of the United States Department of the Treasury; or

 

(c)                               in any successor list to either of the foregoing.

 

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(d)                              No U.S. Obligor or any of its Subsidiaries:

 

(i)                                  is, or is controlled by, a Restricted Party;

 

(ii)                              to the best of its knowledge, has received funds or other property from a Restricted Party; or

 

(iii)                          to the best of its knowledge, is in breach of or is the subject of any action or investigation under any Anti-Terrorism Law.

 

(e)                               Each U.S. Obligor and each of its Subsidiaries have taken reasonable measures to ensure compliance with the Anti-Terrorism Laws.

 

16.13            Sanctions

 

To the best of its and its Subsidiaries’ knowledge, neither it nor any of its Subsidiaries, nor, to the best of its knowledge, any director, officer, agent or, in respect of Vodafone as at the Signing Date only and in the case of an Obligor which becomes a Party after the Signing Date, the date on which it executes a Borrower Accession Agreement or Guarantor Accession Agreement only, any employee or affiliate of it or any of its Subsidiaries are currently subject to any U.S. sanctions administered by the Office of Foreign Assets Control of the U.S. Department of the Treasury (OFAC) or any equivalent sanctions administered or enforced by the United Nations Security Council, the European Union, Her Majesty’s Treasury, the State Secretariat for Economic Affairs or other relevant sanctions authority.

 

16.14            Times for making representations and warranties

 

(a)                               The representations and warranties set out in this Clause 16 (excluding Clause 16.10 (Investment Company) to Clause 16.12 (Anti-Terrorism Laws) (inclusive)):

 

(i)                                  are made by Vodafone on the Signing Date and, in the case of an Obligor which becomes a Party after the Signing Date, will be deemed to be made by that Obligor on the date it executes a Borrower Accession Agreement or Guarantor Accession Agreement; and

 

(ii)                              are deemed to be made again by each Obligor on the date of each Request and on each Drawdown Date with reference to the facts and circumstances then existing (except to the extent specified to the contrary in Clause 16.13 (Sanctions)).

 

(b)                              The representation and warranties set out in Clauses 16.10 (Investment Company), 16.11 (ERISA) and 16.12 (Anti-Terrorism Laws):

 

(i)                                  are made by Vodafone on the date on which the first U.S. Obligor executes a Borrower Accession Agreement or a Guarantor Accession Agreement as the case may be;

 

(ii)                              are deemed to be made by each Obligor which becomes a party after the Signing Date on the date it executes a Borrower Accession Agreement or Guarantor Accession Agreement, provided that there is a U.S. Obligor;

 

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(iii)                          are deemed to be made again by each Obligor on the date of each Request and on each Drawdown Date with reference to the facts and circumstances then existing, provided that there is a U.S. Obligor.

 

17.                            UNDERTAKINGS

 

17.1                    Duration

 

The undertakings in this Clause 17 will remain in force from the Signing Date for so long as any amount is or may be outstanding under this Agreement or any Commitment is in force.

 

17.2                    Financial information

 

Vodafone shall supply to the Agent:

 

(a)                               as soon as the same are publicly available (and in any event within 180 days of the end of each of its financial years):

 

(i)                                  the audited consolidated financial statements of the Consolidated Group for that financial year; and

 

(ii)                              (if published) each other Obligor’s audited statutory accounts for that financial year, consolidated if that Obligor has Subsidiaries and consolidated accounts are prepared and published;

 

(b)                              as soon as the same are publicly available (and in any event within 90 days of the end of the first half-year of each of its financial years) the interim unaudited financial statements of the Consolidated Group for that half-year;

 

(c)                               within 20 days of the day on which the accounts referred to in paragraph (a)(i) above or (b) above are posted on Vodafone’s website in accordance with paragraph (e) below (provided that it shall not be a Default under this Clause 17.2 unless Vodafone fails to so supply within 10 days of written request by the Agent (on its own accord or at the request of a Lender) made at any time following the date of such posting) a certificate signed by a Vodafone authorised officer (or following a Hive Up, a NewTopco authorised officer), or in their absence any director of Vodafone or NewTopco, as the case may be, establishing (in reasonable detail) compliance with Clauses 17.8 (Priority borrowing) and 18 (Financial Covenant) as at the date to which those accounts were drawn up and identifying the Principal Subsidiaries and the operating Subsidiaries which are Controlled Subsidiaries; and

 

(d)                              if, after the date of the most recent certificate delivered pursuant to paragraph (c) above and prior to the date that the next certificate is required to be delivered, a Principal Subsidiary ceases to be Principal Subsidiary as a result of (A) a sale or transfer to or a merger into or with an entity which is not a member of the Restricted Group or (B) the acquisition of a new Principal Subsidiary, a certificate signed by a Vodafone authorised officer (or following a Hive Up, a NewTopco authorised officer), or in their absence any director of Vodafone or NewTopco, as the case may be, which identifies the Principal Subsidiary which has ceased to be a Principal Subsidiary and the new Principal Subsidiary.

 

(e)                               Reports required to be delivered pursuant to clauses (a)(i) and (b) above for Vodafone shall be deemed to have been delivered on the date on which Vodafone posts such reports to its website on the Internet at the website address listed for Vodafone in

 

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Clause 33.2(d) (Addresses for notices) or another relevant website to which the Agent and the Lenders have access and such posting shall be deemed to satisfy the reporting requirements of paragraphs (a)(i) and (a)(ii) above. The Borrower shall provide paper copies of the deliverables required by paragraphs (c) above and (d) above to the Agent (in sufficient copies for all the Lenders if the Agent so requests).

 

17.3                    Information – miscellaneous

 

Vodafone shall supply to the Agent:

 

(a)                               all documents despatched by the ultimate Holding Company of the Controlled Group to its shareholders (or any class of them) or by Vodafone or such ultimate Holding Company to the creditors of the Controlled Group generally (or any class of them) at the same time as they are despatched; and

 

(b)                              as soon as reasonably practicable, such further publicly available information (including that required to comply with “know your customer” or similar identification procedures) in the possession or control of any member of the Controlled Group regarding the business, financial or corporate affairs of the Controlled Group, as the Agent may reasonably request,

 

17.4                    Notification of Default

 

Vodafone shall notify the Agent of any Default (and the steps, if any, being taken to remedy it) promptly upon becoming aware of it.

 

17.5                    Authorisations

 

Each Obligor shall promptly:

 

(a)                               obtain, maintain and comply in all material respects with the terms of; and

 

(b)                              if requested, supply certified copies to the Agent of,

 

any authorisation required under any law or regulation to enable it to perform its obligations under, or for the validity or enforceability of, any Finance Document.

 

17.6                    Pari passu ranking

 

Each Obligor will procure that its obligations under the Finance Documents do and will rank at least pari passu with all its other present and future unsecured and unsubordinated obligations (save for those obligations mandatorily preferred by applicable law).

 

17.7                    Negative pledge

 

No Obligor will, and each Obligor will procure that none of its Subsidiaries which is a member of the Restricted Group will, create or permit to subsist any Security Interest on or over any of its assets except for any Permitted Security Interest.

 

17.8                    Priority borrowing

 

Each Obligor will procure that none of its Subsidiaries (which is a member of the Restricted Group and which is not a Guarantor) will create, assume, incur, guarantee, permit to subsist or

 

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otherwise be liable in respect of any Financial Indebtedness owed to persons outside the Restricted Group except for:

 

(a)                               Financial Indebtedness of any Subsidiary which became a member of the Restricted Group after 1 February 2015 (unless it became a member of the Restricted Group due to the expansion of the definition of Core Jurisdiction to include members of the European Union after 1 February 2015) provided that:

 

(i)                                  any such Financial Indebtedness is either (A) outstanding before that Subsidiary becomes a member of the Restricted Group and was not created in contemplation of that Subsidiary becoming a member of the Restricted Group and/or (B) drawn at any time under commitments in existence before that Subsidiary becomes a member of the Restricted Group (“Existing Commitment”) and that commitment was not created in contemplation of that Subsidiary becoming a member of the Restricted Group and/or (C) drawn at any time under commitments (“New Commitments”) which have refinanced Existing Commitments in whole or in part, to the extent that any such New Commitments do not exceed the Existing Commitments, and provided that to the extent that any New Commitment is to be guaranteed by an Obligor, the obligors under the New Commitments will have validly and legally acceded as Additional Guarantors in accordance with Clauses 27.7(a) and 27.7(b) (Additional Guarantors)) prior to any Obligor providing a guarantee of the New Commitments; and

 

(ii)                              to the extent that the aggregate principal amount of such Financial Indebtedness exceeds the amounts calculated under paragraph (i) above upon that Subsidiary becoming a member of the Restricted Group (measured in the same currency), the excess amount of such Financial Indebtedness shall not fall within this paragraph (a); or

 

(b)                              Financial Indebtedness under finance or structured tax lease arrangements (including, but not limited to qualifying technological equipment leases) to the extent matched as part of those arrangements by deposits of cash or cash equivalent investments (including, but not limited to securities issued by G7 governments) or other securities rated at least A by S&P or A2 by Moody’s or A by Fitch which are treated by the creditor concerned as available to reduce its net exposure; or

 

(c)                               Financial Indebtedness which is created with the prior written consent of the Majority Lenders; or

 

(d)                              Financial Indebtedness to the extent matched by cash balances or cash equivalent investments (including, but not limited to securities issued by G7 governments) or other securities rated at least A by S&P or A2 by Moody’s or A by Fitch, held by members of the Restricted Group which are treated as available for netting by the creditors to whom that Financial Indebtedness is owed under cash management or netting arrangements in the ordinary course of business; or

 

(e)                               Financial Indebtedness under any finance lease or structured tax lease arrangements (including, but not limited to qualifying technological equipment leases) entered into in respect of assets which were or are acquired or become part of the Restricted Group after 1 March 2015; or

 

(f)                                Financial Indebtedness under or in connection with any other finance lease entered into in respect of existing assets or future assets (to the extent they are subject to

 

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Security Interests contemplated under paragraph (j) of the definition of “Permitted Security Interest”); or

 

(g)                               Financial Indebtedness under Back to Back Loans; or

 

(h)                              Financial Indebtedness of any member of the Controlled Group which operates as a finance company to the extent that any such Financial Indebtedness is on-lent to an Obligor or to a member of the Controlled Group outside the Restricted Group; or

 

(i)                                  Financial Indebtedness that has been defeased to the extent that it is subject to Security Interests contemplated under paragraph (u) of the definition of “Permitted Security Interest”; or

 

(j)                                  Financial Indebtedness incurred solely in contemplation of an initial public offering or other disposal of the companies or partnerships incurring such Financial Indebtedness, to the extent that (i) the aggregate principal amount of such Financial Indebtedness does not exceed U.S.$5,000,000,000 (or its equivalent in other currencies) whilst such Financial Indebtedness is owed by a member of the Restricted Group; and (ii) the creditors in respect of such Financial Indebtedness have recourse for no more than ninety days to any member of the Controlled Group which is or whose assets are not intended to be subject to the initial public offering or disposal; or

 

(k)                              Project Finance Indebtedness; or

 

(l)                                  Financial Indebtedness owed to persons outside the Restricted Group under guarantees or other legally binding assurances against financial loss granted by Vodafone Deutschland GmbH or any of its Subsidiaries in respect of any asset, undertaking or business not forming part of the mobile or wireless telecommunications business of the Restricted Group; or

 

(m)                          Financial Indebtedness under this Agreement; or

 

(n)                              other Financial Indebtedness to the extent that the sum of:

 

(i)                                  the aggregate unpaid principal amount of the Financial Indebtedness of all the members of the Restricted Group which are not Guarantors and owed to persons outside the Restricted Group (other than Financial Indebtedness under paragraphs (a) to (m) above inclusive); plus

 

(ii)                              the aggregate unpaid principal amount of Financial Indebtedness secured by Security Interests referred to in paragraph (w) of the definition of “Permitted Security Interest” (to the extent not falling within paragraph (i) above),

 

does not exceed €3,500,000,000 or its equivalent in other currencies.

 

Compliance with this Clause 17.8 will be tested on the last day of each financial half year. For the purposes of paragraph (n) above, Financial Indebtedness of the Restricted Group not denominated in (or which has not been swapped into) Sterling shall be notionally converted (from the currency in which it is denominated or, as the case may be, into which it has been swapped) to Sterling at the rate of exchange used in the management accounts of the relevant Obligor for that relevant financial quarter.

 

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17.9                    Disposals

 

No Obligor will, and each Obligor will procure that none of its Subsidiaries which is a member of the Restricted Group will, either in a single transaction or in a series of transactions, whether related or not and whether voluntarily or involuntarily, make any Asset Disposals other than:

 

(a)                               Asset Disposals:

 

(i)                                  on arm’s length terms which are, in the opinion of an Obligor, at fair market value; or

 

(ii)                              required by law or any governmental authority or agency (including without limitation any authority or agency of the European Union); or

 

(iii)                          made in good faith for the purpose of carrying on the business of the Controlled Group which it is reasonable to believe will benefit the Controlled Group; and

 

(b)                              a transfer of all or any part of the assets of the Controlled Group to NewTopco and/or any Intermediate Holding Company of Vodafone.

 

17.10            Restriction on Acquisitions

 

Vodafone will not, and will procure that no member of the Controlled Group will, make any Acquisition unless the major part of the Controlled Group’s business remains telecommunications, data communications and associated businesses.

 

17.11            Margin Stock

 

(a)                               In this Clause 17.11,

 

Margin Regulations means Regulations T, U and X issued by the Board of Governors of the United States Federal Reserve System.

 

Margin Stock means “margin stock” or “margin securities” as defined in the Margin Regulations.

 

(b)                              No Obligor may:

 

(i)                                  extend credit for the purpose, directly or indirectly, of buying or carrying Margin Stock; or

 

(ii)                              use any Advance, directly or indirectly, to buy or carry Margin Stock or for any other purpose in violation of the Margin Regulations.

 

17.12            Sanctions

 

Each Obligor shall ensure, to the best of its ability, that the proceeds of Advances will not, directly or indirectly, be lent to any person or entity (whether or not related to Vodafone) for the purpose of financing the activities of any person or for the benefit of any country currently subject to any U.S. sanctions administered by OFAC or any equivalent sanctions administered or enforced by the United Nations Security Council, the European Union, Her Majesty’s Treasury, the State Secretariat for Economic Affairs or other relevant sanctions authority.

 

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18.                            FINANCIAL COVENANT

 

18.1                    Financial ratio

 

Vodafone will procure that for each Ratio Period the ratio of Net Debt of the Consolidated Group to two times Adjusted Group Operating Cash Flow for such Ratio Period will not exceed 3.75:1.

 

18.2                    Calculation times and periods

 

(a)                               The first test date for the financial ratio specified in Clause 18.1 (Financial ratio) will occur on 31 March 2015.

 

(b)                              Each subsequent test date will be on the last day of each financial half year and year of Vodafone or, following a Hive Up, NewTopco. The financial ratio will be calculated using data for the period (each a “Ratio Period”) ending on each test date and beginning 6 months before the relevant test date.

 

18.3                    Information sources

 

(a)                               Subject to adjustments that may be required by the operation of definitions in Clause 18.1 (Financial ratio), all information for calculation of the financial ratios set out in Clause 18.1 (Financial ratio) and Clause 19.5 (Cross default) will be extracted from figures denominated in the base currency (as defined in paragraph (c) below used in the preparation of and extracted from:

 

(i)                                  the unaudited consolidated interim financial statements of Vodafone, or following a Hive Up, NewTopco;

 

(ii)                              the consolidated annual financial statements of Vodafone, or following a Hive Up, NewTopco; or

 

(iii)                          Vodafone’s, or following a Hive Up, NewTopco’s consolidated management accounts,

 

as the case may be, which in respect of paragraphs (i) and (ii) above were delivered to the Agent under Clauses 17.2(a)(i) and 17.2(b) (Financial information).

 

(b)                              Information from Vodafone’s, or following a Hive Up, NewTopco’s consolidated management accounts will be disclosed only when the relevant interim or annual financial statements and compliance certificates are delivered to the Agent or as required in connection with Clause 19.5(a)(ii) (Cross default).

 

(c)                               Any amount outstanding in a currency other than the currency used in the latest consolidated published financial statements (the “base currency”) is to be taken into account at the base currency equivalent of that amount calculated at the rate used in the latest consolidated financial statements delivered to the Agent under Clause 17.2 (Financial information) or the latest consolidated management accounts, as appropriate.

 

18.4                    Know Your Customer

 

Each Lender shall promptly upon the request of the Agent supply, or procure the supply of, such documentation and other evidence as is reasonably requested by the Agent (for itself) in

 

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order for the Agent to carry out and be satisfied it has complied with all necessary “know your customer” or other similar checks under all applicable laws and regulations pursuant to the transactions contemplated in the Finance Documents.

 

19.                            DEFAULT

 

19.1                    Events of Default

 

Each of the events set out in Clauses 19.2 (Non-payment) to 19.15 (United States Bankruptcy Laws) (inclusive) is an Event of Default (whether or not caused by any reason whatsoever outside the control of any Obligor or any other person).

 

19.2                    Non-payment

 

An Obligor does not pay within four Business Days (the “Initial Grace Period”) of the due date any amount payable by it under the Finance Documents at the place at, and in the currency in, which it is expressed to be payable unless its failure to pay is caused by:

 

(a)                               administrative or technical error and payment is made within a further two Business Days after the expiry of the Initial Grace Period; or

 

(b)                              a Disruption Event and payment is made within a further four Business Days after the expiry of the Initial Grace Period.

 

19.3                    Breach of other obligations

 

(a)                               Vodafone does not comply with Clause 18 (Financial Covenant).

 

(b)                              An Obligor does not comply with any provision of the Finance Documents (other than those referred to in paragraph (a) above or in Clause 19.2 (Non-payment)) and such failure (if capable of remedy before the expiry of such period) continues unremedied for a period of 21 days from the earlier of the date on which (i) such Obligor has become aware of the failure to comply or (ii) the Agent gives notice to Vodafone requiring the same to be remedied.

 

19.4                    Misrepresentation

 

A representation or warranty made or repeated by any Obligor in any Finance Document is found to be untrue in any respect material in the context of performance of the Finance Documents when made or deemed to have been made.

 

19.5                    Cross default

 

(a)                               (i)                                  Any Financial Indebtedness of any Obligor is:

 

(A)                           not paid when due or within any originally applicable grace period; or

 

(B)                            declared due, or is capable of being declared due, prior to its specified maturity as a result of an event of default (howsoever described) except this paragraph (B) does not apply to:

 

I.                                       Financial Indebtedness quoted or listed on a stock exchange; or

 

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II.                                  Financial Indebtedness of an Obligor arising solely under paragraph (f) of the definition of “Financial Indebtedness” in Clause 1.1 (Definitions); or

 

(ii)                              any Financial Indebtedness of any Principal Subsidiary is:

 

(A)                           not paid when due or within any originally applicable grace period; or

 

(B)                            declared due prior to its specified maturity as a result of an event of default (howsoever described) and is not paid within three Business Days of being declared due,

 

except this paragraph (ii) only applies if the ratio calculated in accordance with Clause 18.1 (Financial ratio) for the most recent Ratio Period is greater than 3.25:1; or

 

(iii)                          an Event of Default has occurred under the 2019 Facility and is continuing.

 

(b)                              Paragraph (a) above does not apply:

 

(i)                                  to Project Finance Indebtedness; or

 

(ii)                              to Financial Indebtedness which in aggregate is less than £100,000,000 (or equivalent currency); or

 

(iii)                          where the payment or occurrence of the event concerned is being contested in good faith; or

 

(iv)                          where the default is under a bond and is capable of waiver without bondholder consent; or

 

(v)                              to Financial Indebtedness owed to a member of the Restricted Group.

 

19.6                    Winding up

 

An order is made or an effective resolution is passed for winding up any Obligor or any Principal Subsidiary (except for the purposes of a reconstruction or amalgamation on terms previously approved in writing by the Majority Lenders) or a petition is presented (which is not set aside or withdrawn within the earlier of 30 days of its presentation or by not later than the date for the hearing of such petition) for an administration order or for the winding up of any Obligor or any Principal Subsidiary except where demonstrated to the reasonable satisfaction of the Majority Lenders that any such petition is being contested in good faith.

 

19.7                    Insolvency process

 

(a)                               A liquidator, administrator, receiver, trustee, sequestrator or similar officer is appointed in respect of all or any part of the assets of any Obligor or any Principal Subsidiary which generates a material part of the revenues of that Obligor or that Principal Subsidiary; or

 

(b)                              any Obligor or any Principal Subsidiary, by reason of financial difficulties, enters into a composition, assignment or a moratorium in respect of any indebtedness or arrangement with any class of its creditors.

 

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19.8                    Enforcement proceedings

 

A distress, execution, attachment or other legal process is levied, enforced or sued out upon or against all or any part of the assets of any Obligor or any Principal Subsidiary which generates a material part of the revenues of that Obligor or that Principal Subsidiary except where the same is being contested in good faith or is removed, discharged or paid within 30 days.

 

19.9                    Insolvency

 

Any Obligor or any Principal Subsidiary is deemed under Section 123(1)(e) or 123(2) of the Insolvency Act 1986 to be unable to pay its debts.

 

19.10            Similar proceedings

 

Anything having a substantially similar effect to any of the events specified in Clauses 19.6 (Winding up) to 19.9 (Insolvency) inclusive shall occur under the laws of any applicable jurisdiction in relation to any Obligor or any Principal Subsidiary.

 

19.11            Unlawfulness

 

It is or becomes unlawful for any Obligor to perform any of its payment or other material obligations under the Finance Documents.

 

19.12            Guarantee

 

The guarantee of any Guarantor under Clause 15 (Guarantee) is not effective or is alleged by an Obligor to be ineffective for any reason (other than by reason of written release or waiver by the Finance Parties or in accordance with Clause 15.9 (Removal of Guarantors)).

 

19.13            Cessation of business

 

Any Obligor or any Principal Subsidiary ceases to carry on all or substantially all of its business otherwise than:

 

(a)                               as a result of a transfer of all or any part of its business to a member of the Restricted Group; or

 

(b)                              as a result of a disposal permitted under Clause 17.9 (Disposals); or

 

(c)                               with the prior written consent of the Majority Lenders.

 

19.14            Litigation

 

Any litigation proceedings are current which are reasonably likely to be adversely determined and which would have a material adverse effect on the ability of the Obligors (taken as a whole) to perform their payment obligations under the Finance Documents.

 

19.15            United States Bankruptcy Laws

 

(a)                               In this Clause 19.15 and Clause 19.16 (Acceleration):

 

U.S. Bankruptcy Law means the United States Bankruptcy Code or any other United States Federal or State bankruptcy, insolvency or similar law.

 

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U.S. Debtor means an Obligor that is incorporated or organized under the laws of the United States or any State of the United States (including the District of Columbia) or that has a place of business or property in the United States.

 

(b)                              Any of the following occurs in respect of a U.S. Debtor:

 

(i)                                  it makes a general assignment for the benefit of creditors;

 

(ii)                              it commences a voluntary case or proceeding under any U.S. Bankruptcy Law; or

 

(iii)                          an involuntary case under any U.S. Bankruptcy Law is commenced against it and is not controverted within 20 days or is not dismissed or stayed within 60 days after commencement of the case; or

 

(iv)                          an order for relief or other order approving any case or proceeding is entered under any U.S. Bankruptcy Law.

 

19.16            Acceleration

 

(a)                               On and at any time after the occurrence of an Event of Default while such event is continuing the Agent may, and if so directed by the Majority Lenders, will by notice to Vodafone, declare that an Event of Default has occurred and:

 

(i)                                  if not already cancelled under paragraph (b) below, cancel the Total Commitments; and/or

 

(ii)                              demand that all the Advances, together with accrued interest, and all other amounts accrued under the Finance Documents be immediately due and payable, whereupon they shall become immediately due and payable; and/or

 

(iii)                          demand that all the Advances be payable on demand, whereupon they shall immediately become payable on demand.

 

(b)          If an Event of Default described in Clause 19.15 (United States Bankruptcy Laws) occurs, the Commitments which are available to any U.S. Debtor will, if not already cancelled under this Agreement, be immediately and automatically cancelled and all amounts owed by any U.S. Debtor outstanding under the Finance Documents will be immediately and automatically due and payable, without the requirement of notice or any other formality.

 

20.                            THE AGENTS, THE ARRANGERS AND THE REFERENCE BANKS

 

20.1                    Appointment and duties of the Agents

 

Each Finance Party (other than the Agent) irrevocably appoints the Agent to act as its agent under and in connection with the Finance Documents and each Swingline Lender appoints the U.S. Swingline Agent to act as its agent in relation to the Swingline Facility, and each Finance Party irrevocably authorises the Agent or, as the case may be, the U.S. Swingline Agent on its behalf to perform the duties and to exercise the rights, powers and discretions that are specifically delegated to it under or in connection with the Finance Documents, together with any other incidental rights, powers and discretions. The Agent or, as the case may be, the U.S. Swingline Agent shall have only those duties which are expressly specified in this Agreement. Those duties are solely of a mechanical and administrative nature.

 

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20.2                    Role of the Arrangers

 

Except as otherwise provided in this Agreement, no Arranger has any obligations of any kind to any other Party under or in connection with any Finance Document.

 

20.3                    Relationship

 

The relationship between the Agent or, as the case may be, the U.S. Swingline Agent and the other Finance Parties is that of agent and principal only. Nothing in this Agreement constitutes the Agent or, as the case may be, the U.S. Swingline Agent as trustee or fiduciary for any other Party or any other person and the Agent or, as the case may be, the U.S. Swingline Agent need not hold in trust any moneys paid to it for a Party or be liable to account for interest on those moneys.

 

20.4                    Majority Lenders’ directions

 

(a)                               The Agent or, as the case may be, the U.S. Swingline Agent will be fully protected if it acts in accordance with the instructions of the Majority Lenders in connection with the exercise of any right, power or discretion or any matter not expressly provided for in the Finance Documents. Any such instructions given by the Majority Lenders will be binding on all the Lenders. In the absence of such instructions the Agent or, as the case may be, the U.S. Swingline Agent may act as it considers to be in the best interests of all the Lenders.

 

(b)                              Neither the Agent nor the U.S. Swingline Agent is authorised to act on behalf of a Lender (without first obtaining that Lender’s consent) in any legal or arbitration proceedings relating to any Finance Document.

 

20.5                    Delegation

 

The Agent or, as the case may be, the U.S. Swingline Agent may act under the Finance Documents through its personnel and agents.

 

20.6 Responsibility for documentation

 

Neither the Agent, the U.S. Swingline Agent nor any Arranger is responsible to any other Party for:

 

(a)                               the execution, genuineness, validity, enforceability or sufficiency of any Finance Document or any other document by any other Party; or

 

(b)                              the collectability of amounts payable under any Finance Document; or

 

(c)                               the accuracy of any statements (whether written or oral) made in or in connection with any Finance Document by any other Party.

 

20.7                    Default

 

(a)                               The Agent or, as the case may be, the U.S. Swingline Agent is not obliged to monitor or enquire as to whether or not a Default has occurred. Neither the Agent nor the U.S. Swingline Agent will be deemed to have knowledge of the occurrence of a Default. However, if the Agent or, as the case may be, the U.S. Swingline Agent receives notice from a Party referring to this Agreement, describing the Default and stating that the event is a Default, it shall promptly notify the Lenders of such notice.

 

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(b)                              The Agent or, as the case may be, the U.S. Swingline Agent may require the receipt of security satisfactory to it whether by way of payment in advance or otherwise, against any liability or loss which it will or may incur in taking any proceedings or action arising out of or in connection with any Finance Document before it commences these proceedings or takes that action.

 

20.8                    Exoneration

 

(a)                               Without limiting paragraph (b) below, the Agent or, as the case may be, the U.S. Swingline Agent will not be liable to any other Party for any action taken or not taken by it under or in connection with any Finance Document, unless directly caused by its negligence or wilful misconduct or breach of any of its obligations under or in connection with the Finance Documents.

 

(b)                              No Party may take any proceedings against any officer, employee or agent being an individual of the Agent or, as the case may be, the U.S. Swingline Agent in respect of any claim it might have against the Agent or, as the case may be, the U.S. Swingline Agent or in respect of any act or omission of any kind (including negligence or wilful misconduct) by that officer, employee or agent in relation to any Finance Document.

 

(c)                               Any officer, employee or agent being an individual of the Agent, or as the case may be, the U.S. Swingline Agent may rely on paragraph (b) above and enforce its terms under the Contract (Rights of Third Parties) Act 1999.

 

(d)                              Nothing in this Agreement shall oblige the Agent or an Arranger to carry out any “know your customer” or other checks in relation to any person on behalf of any Lender and each Lender confirms to the Agent and an Arranger that it is solely responsible for any such checks it is required to carry out and that it may not rely on any statement in relation to such checks made by the Agent or an Arranger.

 

20.9                    Reliance

 

The Agent or, as the case may be, the U.S. Swingline Agent may:

 

(a)                               rely on any notice or document reasonably believed by it to be genuine and correct and to have been signed by, or with the authority of, the proper person;

 

(b)                              rely on any statement made by a director or employee of any person regarding any matters which may reasonably be assumed to be within his knowledge or within his power to verify; and

 

(c)                               engage, pay for and rely on legal or other professional advisers selected by it (including those in the Agent’s or, as the case may be, the U.S. Swingline Agent’s employment and those representing a Party other than the Agent or, as the case may be, the U.S. Swingline Agent).

 

20.10            Credit approval and appraisal

 

Without affecting the responsibility of any Obligor for information supplied by it or on its behalf in connection with any Finance Document, each Lender confirms that it:

 

(a)                               has made its own independent investigation and assessment of the financial condition and affairs of each Obligor and its related entities in connection with its participation in this Agreement and has not relied exclusively on any information provided to it by

 

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the Agent, the U.S. Swingline Agent or the Arrangers in connection with any Finance Document; and

 

(b)                              will continue to make its own independent appraisal of the creditworthiness of each Obligor and its related entities while any amount is or may be outstanding under the Finance Documents or any Commitment is in force.

 

20.11            Information

 

(a)                               The Agent or, as the case may be, the U.S. Swingline Agent shall promptly forward to the person concerned the original or a copy of any document which is delivered to the Agent or, as the case may be, the U.S. Swingline Agent by a Party for that person.

 

(b)                              The Agent shall promptly supply a Lender with a copy of each document received by the Agent under Clauses 4 (Conditions Precedent), 27.7 (Additional Guarantors) or 27.8 (Additional Borrowers) upon the request and at the expense of that Lender.

 

(c)                               Except where this Agreement specifically provides otherwise, the Agent or, as the case may be, the U.S. Swingline Agent is not obliged to review or check the accuracy or completeness of any document it forwards to another Party.

 

(d)                              The Agent shall provide to Vodafone within five Business Days of a request by Vodafone (but no more than once per calendar month), a list (which may be in electronic form) setting out the names of the Lenders as at the date of that request, their respective Commitments, the address and fax number (and the department or officer, if any, for whose attention any communication is to be made or document to be delivered under or in connection with the Finance Documents), the electronic mail address and/or any other information required to enable the sending and receipt of information by electronic mail or other electronic means to and by each Lender to whom any communication under or in connection with the Finance Documents may be made by that means and the account details of each Lender for any payment to be distributed by the Agent to that Lender under the Finance Documents.

 

(e)                               Except as provided above, the Agent or, as the case may be, the U.S. Swingline Agent has no duty:

 

(i)                                  either initially or on a continuing basis to provide any Lender with any credit or other information concerning the financial condition or affairs of any Obligor or any related entity of any Obligor whether coming into its possession or that of any of its related entities before, on or after the Signing Date; or

 

(ii)                              unless specifically requested to do so by a Lender in accordance with this Agreement, to request any certificates or other documents from any Obligor.

 

20.12            The Agent, the U.S. Swingline Agent and the Arrangers individually

 

(a)                               If it is also a Lender, each of the Agent, the U.S. Swingline Agent and the Arrangers has the same rights and powers under this Agreement as any other Lender and may exercise those rights and powers as though it were not the Agent, the U.S. Swingline Agent or an Arranger.

 

(b)                              Each of the Agent, the U.S. Swingline Agent and the Arrangers may:

 

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(i)                                  carry on any business with an Obligor or its related entities;

 

(ii)                              act as agent or trustee for, or in relation to any financing involving, an Obligor or its related entities; and

 

(iii)                          retain any profits or remuneration in connection with its activities under the Finance Documents, or in relation to any of the foregoing.

 

20.13            Indemnities

 

(a)                               Without limiting the liability of any Obligor under the Finance Documents, each Lender shall forthwith on demand indemnify the Agent or, as the case may be, the U.S. Swingline Agent for its proportion of any liability or loss incurred by the Agent or, as the case may be, the U.S. Swingline Agent in any way relating to or arising out of its acting as the Agent or, as the case may be, the U.S. Swingline Agent, except to the extent that the liability or loss arises directly from the Agent’s or, as the case may be, the U.S. Swingline Agent’s negligence or wilful misconduct.

 

(b)                              A Lender’s proportion of the liability or loss set out in paragraph (a) above is the proportion which its Commitment bears to the Total Commitments at the date of demand or, if the Total Commitments have been cancelled, bore to the Total Commitments immediately before being cancelled.

 

20.14            Compliance

 

(a)                               The Agent or, as the case may be, the U.S. Swingline Agent, may refrain from doing anything which might, in its reasonable opinion, constitute a breach of any law or regulation or be otherwise actionable at the suit of any person, and may do anything which, in its reasonable opinion, is necessary or desirable to comply with any law or regulation of any jurisdiction.

 

(b)                              Without limiting paragraph (a) above, the Agent or, as the case may be, the U.S. Swingline Agent, need not disclose any information relating to any Obligor or any of its related entities if the disclosure might, in the opinion of the Agent or, as the case may be, the U.S. Swingline Agent, constitute a breach of any law or regulation or any duty of secrecy or confidentiality or be otherwise actionable at the suit of any person.

 

20.15            Resignation of the Agent or the U.S. Swingline Agent

 

(a)                               Notwithstanding its irrevocable appointment, the Agent or, as the case may be, the U.S. Swingline Agent, may resign by giving notice to the Lenders and Vodafone, in which case the Agent or, as the case may be, the U.S. Swingline Agent, may forthwith appoint one of its Affiliates as successor Agent or, failing that, the Majority Lenders may after consultation with Vodafone appoint a reputable and experienced bank as successor Agent or, as the case may be, successor U.S. Swingline Agent.

 

(b)                              If the appointment of a successor Agent or, as the case may be, successor U.S. Swingline Agent is to be made by the Majority Lenders but they have not, within 30 days after notice of resignation, appointed a successor Agent or, as the case may be, successor U.S. Swingline Agent which accepts the appointment, the retiring Agent or, as the case may be, the retiring U.S. Swingline Agent may, following consultation with Vodafone, appoint a successor Agent or, as the case may be, successor U.S. Swingline Agent.

 

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(c)                               The resignation of the retiring Agent or, as the case may be, retiring U.S. Swingline Agent and the appointment of any successor Agent or, as the case may be, successor U.S. Swingline Agent will both become effective only upon the successor Agent or, as the case may be, successor U.S. Swingline Agent notifying all the Parties that it accepts the appointment. On giving the notification and receiving such approval, the successor Agent or, as the case may be, successor U.S. Swingline Agent will succeed to the position of the retiring Agent or, as the case may be, retiring U.S. Swingline Agent and the term “Agent” or, as the case may be, “U.S. Swingline Agent” will mean the successor Agent or, as the case may be, successor U.S. Swingline Agent.

 

(d)                              The retiring Agent or, as the case may be, retiring U.S. Swingline Agent shall, at its own cost, make available to the successor Agent or, as the case may be, successor U.S. Swingline Agent such documents and records and provide such assistance as the successor Agent or, as the case may be, successor U.S. Swingline Agent may reasonably request for the purposes of performing its functions as the Agent or, as the case may be, the U.S. Swingline Agent under this Agreement.

 

(e)                               Upon its resignation becoming effective, this Clause 20 shall continue to benefit the retiring Agent or, as the case may be, retiring U.S. Swingline Agent in respect of any action taken or not taken by it under or in connection with the Finance Documents while it was the Agent or, as the case may be, the U.S. Swingline Agent, and, subject to paragraph (d) above, it shall have no further obligation under any Finance Document.

 

(f)                                The Majority Lenders may by notice to the Agent or, as the case may be, the U.S. Swingline Agent, require it to resign in accordance with paragraph (a) above. In this event, the Agent or, as the case may be, the U.S. Swingline Agent shall resign in accordance with paragraph (a) above but it shall not be entitled to appoint one of its Affiliates as successor Agent or successor U.S. Swingline Agent.

 

(g)                               Any successor Agent or, as the case may be, successor U.S. Swingline Agent and each of the other Parties shall have the same rights and obligations amongst themselves as they would have had if such successor had been an original party to this Agreement.

 

(h)                              The Agent or, as the case may be, the U.S. Swingline Agent shall resign in accordance with paragraph (a) above (and, to the extent applicable, shall use reasonable endeavours to appoint a successor Agent or, as the case may be, the U.S. Swingline Agent, pursuant to paragraph (c) above) if on or after the date which is three months before the earliest FATCA Application Date relating to any payment to the Agent or, as the case may be, the U.S. Swingline Agent, under the Finance Documents, either:

 

(i)                                  the Agent or, as the case may be, the U.S. Swingline Agent, fails to respond to a request under Clause 11.7 (FATCA Information) and Vodafone or a Lender reasonably believes that the Agent or, as the case may be the U.S. Swingline Agent, will not be (or will have ceased to be) a FATCA Exempt Party on or after that FATCA Application Date;

 

(ii)                              the information supplied by the Agent or, as the case may be, the U.S. Swingline Agent, pursuant to Clause 11.7 (FATCA Information) indicates that the Agent will not be (or will have ceased to be) a FATCA Exempt Party on or after that FATCA Application Date; or

 

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(iii)                          the Agent or, as the case may be, the U.S. Swingline Agent, notifies Vodafone and the Lenders that the Agent or, as the case may be, the U.S. Swingline Agent, will not be (or will have ceased to be) a FATCA Exempt Party on or after that FATCA Application Date;

 

and (in each case) Vodafone or a Lender reasonably believes that a Party will be required to make a FATCA Deduction that would not be required if the Agent were a FATCA Exempt Party, and Vodafone or that Lender, by notice to the Agent, or, as the case may be, the U.S. Swingline Agent, requires it to resign.

 

20.16            Lenders

 

The Agent or, as the case may be, the U.S. Swingline Agent may treat each Lender as a Lender, entitled to payments under this Agreement and as acting through its Facility Office(s) until it has received notice from the Lender to the contrary by not less than five Business Days prior to the relevant payment.

 

20.17            Chinese wall

 

In acting as Agent, U.S. Swingline Agent or Arranger, the agency and syndications division of each of the Agent, the U.S. Swingline Agent and each Arranger shall be treated as a separate entity from its other divisions and departments. Any information acquired at any time by the Agent, the U.S. Swingline Agent or any Arranger otherwise than in the capacity of Agent, U.S. Swingline Agent or Arranger through its agency and syndications division (whether as financial advisor to any member of the Consolidated Group or otherwise) may be treated as confidential by the Agent, U.S. Swingline Agent or Arranger and shall not be deemed to be information possessed by the Agent, U.S. Swingline Agent or Arranger in their capacity as such. Each Finance Party acknowledges that the Agent, the U.S. Swingline Agent and the Arrangers may, now or in the future, be in possession of, or provided with, information relating to the Obligors which has not or will not be provided to the other Finance Parties. Each Finance Party agrees that, except as expressly provided in this Agreement, none of the Agent, U.S. Swingline Agent or any Arranger will be under any obligation to provide, or under any liability for failure to provide, any such information to the other Finance Parties.

 

20.18            Role of Reference Banks

 

(a)                               No Reference Bank is under any obligation to provide a quotation or any other information to the Agent.

 

(b)                              No Reference Bank will be liable for any action taken by it under or in connection with any Finance Document, or for any Reference Bank Quotation, unless directly caused by its gross negligence or wilful misconduct.

 

(c)                               No Party (other than the relevant Reference Bank) may take any proceedings against any officer, employee or agent of any Reference Bank in respect of any claim it might have against that Reference Bank or in respect of any act or omission of any kind by that officer, employee or agent in relation to any Finance Document, or to any Reference Bank Quotation, and any officer, employee or agent of each Reference Bank may rely on this Clause 20.18 subject to Clause 1.2 (Construction) and the provisions of the Third Parties Act.

 

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20.19            Third party Reference Banks

 

A Reference Bank which is not a Party may rely on Clause 20.18 (Role of Reference Banks), Clause 26.2 (Other exceptions) and Clause 28.3 (Confidentiality of Funding Rates and Reference Bank Quotations) subject to Clause 1.2 (Construction) and the provisions of the Third Parties Act.

 

21.                            FEES

 

21.1                    Commitment fee

 

(a)                               Vodafone shall pay to the Agent for distribution to each Lender pro rata to the proportion its Revolving Credit Commitment bears to the Total Commitments from time to time a commitment fee at the rate of 35 per cent. of the applicable Margin on any undrawn, uncancelled amount of the Total Commitments on each day.

 

(b)                              Commitment fee is calculated and accrues on a daily basis on and from the Signing Date and is payable quarterly in arrear. Accrued and unpaid commitment fee is also payable to the Agent for the relevant Lender(s) on any amount of its Revolving Credit Commitment, which is cancelled voluntarily by the Borrower at the time the cancellation takes effect (but only in respect of the period up to the date of cancellation).

 

(c)                               No commitment fee is payable to the Agent (for the account of a Lender) on any Available Commitment of that Lender for any day on which that Lender is a Defaulting Lender.

 

21.2                    Utilisation fee

 

(a)                               Vodafone shall pay to the Agent for distribution to each Lender pro rata to the proportion its Revolving Credit Commitment bears to the Total Commitments from time to time a utilisation fee in accordance with paragraphs (b) and (c) below and at the rate per annum specified in paragraph (b) below on any outstanding drawn amount of any Advance on each day.

 

(b)                              The utilisation fee will be paid on the aggregate outstanding amount of all Advances for each day upon which the outstanding Advances exceed one half of the Total Commitments, at the rate of 0.275 per cent per annum.

 

(c)                               The utilisation fee is calculated and accrues on a daily basis and is payable at the end of each Term.

 

21.3                    Agent’s fee

 

Vodafone shall pay to the Agent for its own account an agency fee in the amounts and on the dates agreed in the relevant Fee Letter.

 

21.4                    Front-end fees

 

(a)                               Vodafone shall pay to the Agent for the Original Lenders as at the Signing Date a front-end fee in the amount and on the date specified in the relevant Fee Letter.

 

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(b)                              If so agreed between Vodafone and an Additional Lender, Vodafone shall pay to such Additional Lender a front-end fee in the amounts and on the dates specified in the relevant Fee Letter.

 

21.5                    VAT

 

Any fee referred to in this Clause 21 is exclusive of any United Kingdom value added tax. If any value added tax is so chargeable, it shall be paid by Vodafone at the same time as it pays the relevant fee.

 

22.                            EXPENSES

 

22.1                    Initial and special costs

 

Vodafone shall forthwith on demand pay the Agent, the U.S. Swingline Agent and the Arrangers the amount of all out-of-pocket costs and expenses (including but not limited to legal fees up to an amount agreed, in the case of (a)(i) below, with the Arrangers) reasonably incurred by any of them in connection with:

 

(a)                               the negotiation, preparation, printing and execution of:

 

(i)                                  this Agreement and any other documents referred to in this Agreement; and

 

(ii)                              any other Finance Document (other than a Novation Certificate) executed after the Signing Date;

 

(b)                              any amendment, waiver, consent or suspension of rights (or any proposal for any of the foregoing) requested by or on behalf of an Obligor and relating to a Finance Document or a document referred to in any Finance Document or any amendment to this Agreement to reflect a change in currency of a country pursuant to Clause 10.4(b)(iii) (Currency); and

 

(c)                               any other agency matter not of an ordinary administrative nature, arising out of or in connection with a Finance Document in the amount agreed between the Agent and Vodafone at the relevant time.

 

22.2                    Enforcement costs

 

Vodafone shall within five Business Days of receiving written demand pay to each Finance Party the amount of all costs and expenses (including but not limited to legal fees) incurred (or in the case of (b) below reasonably incurred) by it:

 

(a)                               in connection with the enforcement of any Finance Document; or

 

(b)                              in connection with the preservation of any rights under any Finance Document.

 

23.                            STAMP DUTIES

 

Vodafone shall pay and within five Business Days of receiving written demand indemnify each Finance Party against any liability it incurs in respect of any stamp, registration or similar tax which is or becomes payable in any jurisdiction in or through which any payment under the Finance Documents is made or any Obligor is incorporated or has any assets in connection with the entry into, performance or enforcement of any Finance Document.

 

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24.                            INDEMNITIES

 

24.1                    Currency indemnity

 

(a)                               If a Finance Party receives an amount in respect of an Obligor’s liability under the Finance Documents or if that liability is converted into a claim, proof, judgment or order in a currency other than the currency (the “Contractual Currency”) in which the amount is expressed to be payable under the relevant Finance Document:

 

(i)                                  that Obligor shall indemnify that Finance Party as an independent obligation against any loss or liability arising out of or as a result of the conversion;

 

(ii)                              if the amount received by that Finance Party, when converted into the Contractual Currency at a market rate in the usual course of its business, is less than the amount owed in the Contractual Currency, the Obligor concerned shall forthwith on demand pay to that Finance Party an amount in the Contractual Currency equal to the deficit (provided that if the amount received by the Finance Party following such conversion is greater than the amount owed, the Finance Party shall pay to such Obligor an amount equal to the excess); and

 

(iii)                          the Obligor shall pay to the Finance Party concerned on demand any exchange costs and taxes payable in connection with any such conversion.

 

(b)                              Each Obligor waives any right it may have in any jurisdiction to pay any amount under the Finance Documents in a currency other than that in which it is expressed to be payable.

 

24.2                    Other indemnities

 

Vodafone shall forthwith on demand indemnify each Finance Party against any loss or liability which that Finance Party incurs as a consequence of:

 

(a)                               the occurrence of any Default; or

 

(b)                              the operation of Clause 19.16 (Acceleration); or

 

(c)                               any payment of principal or an Overdue Amount being received from any source otherwise than in the case of Revolving Credit Advances or Swingline Advances on its Maturity Date (and, for the purposes of this paragraph (c), the Maturity Date of an Overdue Amount is the last day of each Designated Term); or

 

(d)                              a Default or an action or omission by an Obligor resulting in an Advance not being disbursed after a Borrower has delivered a Request for that Advance.

 

Vodafone’s liability in each case includes any loss or expense, (excluding loss of Margin) in respect or on account of funds borrowed, contracted for or utilised to fund any amount payable under any Finance Document, any amount repaid or prepaid or any Advance.

 

24.3                    Breakage costs

 

If a Finance Party receives or recovers any payment of principal of an Advance or of an Overdue Amount other than on its Maturity Date or, as the case may be, the last day of the Designated Term for the purposes of calculation of the amount payable by Vodafone under

 

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sub-clause (c) of Clause 24.2 (Other indemnities) in respect of the amount so received or recovered, that Finance Party shall calculate:

 

(a)                               the additional interest (excluding the Margin) which would have been payable on the principal so received or recovered had it been received or recovered on the relevant Maturity Date or, as the case may be, the last day of the Designated Term; and

 

(b)                              the amount of interest which would have been payable to that Finance Party on the relevant Maturity Date or, as the case may be, the last day of the Designated Term concerned in respect of a deposit by that Finance Party in the currency of the amount received or recovered placed with a prime bank in London earning interest from (and including) the earliest Business Day for placing deposits in such currency following receipt of that amount up to (but excluding) the relevant Maturity Date or, as the case may be, the last day of the applicable Designated Term,

 

and if the amount payable under paragraph (a) above is greater than the amount payable under paragraph (b) above, Vodafone will, forthwith on receipt of a demand from the relevant Finance Party pursuant to sub-clause (c) of Clause 24.2 (Other indemnities), pay to that Finance Party an amount equal to the difference between the amount payable under paragraphs (a) and (b) above.

 

25.                            EVIDENCE AND CALCULATIONS

 

25.1                    Accounts

 

Accounts maintained by a Finance Party in connection with this Agreement are prima facie evidence of the matters to which they relate (except in a case of manifest error).

 

25.2                    Certificates and determinations

 

Any certification or determination by a Finance Party of a rate or amount under this Agreement is, in the absence of manifest error, prima facie evidence of the matters to which it relates.

 

25.3                    Calculations

 

Interest and the fees payable under Clause 21.1 (Commitment fee) accrue from day to day and are calculated on the basis of the actual number of days elapsed and a year of 360 days, or, in the case of interest at the Swingline Rate or any interest payable in an amount denominated in Sterling, 365 days.

 

26.                            AMENDMENTS AND WAIVERS

 

26.1                    Procedure

 

(a)                               Subject to Clause 26.2 (Exceptions) and Clause 26.4 (NewTopco), any term of the Finance Documents may be amended or waived with the agreement of Vodafone and the Majority Lenders. The Agent may effect, on behalf of the Lenders, an amendment to which the Majority Lenders have agreed.

 

(b)                              The Agent shall promptly notify the other Parties of any amendment or waiver effected under paragraph (a) above, and any such amendment or waiver shall be binding on all the Parties.

 

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26.2                    Exceptions

 

An amendment or waiver which relates to:

 

(a)                               the definition of “Majority Lenders” in Clause 1.1 (Definitions); or

 

(b)                              an extension of the date for, or a decrease in an amount or a change in the currency of, any payment under the Finance Documents; or

 

(c)                               an increase in or extension of a Lender’s Commitment or a change to the Margin; or

 

(d)                              a change in the guarantee under Clause 15 (Guarantee) otherwise than in accordance with Clause 27.7 (Additional Guarantors) or Clause 15.9 (Removal of Guarantors); or

 

(e)                               a term of a Finance Document which expressly requires the consent of each Lender; or

 

(f)                                Clause 27.5 (Replacement of Lenders); or

 

(g)                               Clause 30 (Pro Rata Sharing), 2.5 (Nature of rights and obligations) or this Clause 26; or

 

(h)                              any Term exceeding six months,

 

may not be effected without the consent of each Lender. Any amendment or waiver which changes, or relates to the rights and/or obligations of the Agent, the U.S. Swingline Agent or a Reference Bank shall also require the Agent’s, the U.S. Swingline Agent’s or that Reference Bank’s (as applicable) agreement.

 

26.3                    Replacement of Screen Rate

 

(a)                               Subject to Clause 26.2 (Exceptions), if any Screen Rate is not available for a currency which can be selected for an Advance, any amendment or waiver which relates to providing for another benchmark rate to apply in relation to that currency in place of that Screen Rate (or which relates to aligning any provision of a Finance Document to the use of that other benchmark rate) may be made with the consent of the Majority Lenders and the Obligors.

 

(b)                              If any Lender fails to respond to a request for an amendment or waiver described in paragraph (a) above within 5 Business Days (unless Vodafone and the Agent agree to a longer time period in relation to any request) of that request being made:

 

(i)                                  its Commitment shall not be included for the purpose of calculating the Total Commitments under the relevant Facility when ascertaining whether any relevant percentage of Total Commitments has been obtained to approve that request; and

 

(ii)                              its status as Lender shall be disregarded for the purpose of ascertaining whether the agreement of any specified group of Lenders has been obtained to approve that request.

 

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26.4                    NewTopco

 

Any amendment substituting a reference to Vodafone with a reference to NewTopco:

 

(a)                               to any procedural or administrative provision of this Agreement; or

 

(b)                              which puts the Parties in substantially the same position as applied prior to the Hive Up,

 

may be effected by agreement between NewTopco and the Agent.

 

26.5                    Waivers and remedies cumulative

 

The rights of each Party under the Finance Documents:

 

(a)                               may be exercised as often as necessary;

 

(b)                              are cumulative and not exclusive of its rights under the general law; and

 

(c)                               may be waived only in writing and specifically.

 

Delay in exercising or non-exercise of any such right is not a waiver of that right.

 

26.6                    Disenfranchisement of Defaulting Lenders

 

(a)                               For so long as a Defaulting Lender has any Available Commitment, in ascertaining the Majority Lenders or whether any given percentage (including, for the avoidance of doubt, unanimity) of the Total Commitments has been obtained to approve any request for a consent, waiver, amendment or other vote under the Finance Documents, that Defaulting Lender’s commitments will be reduced by the amount of its Available Commitments.

 

(b)                              For the purposes of this Clause 26.6, the Agent may assume that the following Lenders are Defaulting Lenders:

 

(i)                                  any Lender which has notified the Agent that it has become a Defaulting Lender;

 

(ii)                              any Lender in relation to which it is aware that any of the events or circumstances referred to in paragraphs (a) or (b) of the definition of “Defaulting Lender” has occurred, and in the case of the events or circumstances referred to in paragraph (a) of the definition of “Defaulting Lender”, none of the exceptions to that paragraph apply,

 

unless it has received notice to the contrary from the Lender concerned (together with any supporting evidence reasonably requested by the Agent) or the Agent is otherwise aware that the Lender has ceased to be a Defaulting Lender.

 

26.7                    Replacement of a Defaulting Lender

 

(a)                               Vodafone may, at any time a Lender has become and continues to be a Defaulting Lender, by giving five Business Days’ prior written notice to the Agent and such Lender:

 

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(i)                                  replace such Lender by requiring such Lender to (and such Lender shall) transfer pursuant to Clause 27 (Changes to the Parties) all (and not part only) of its rights and obligations under this Agreement; or

 

(ii)                              require such Lender to (and such Lender shall) transfer pursuant to Clause 27 (Changes to the Parties) all (and not part only) of the undrawn Commitments of the Lender,

 

to a Lender or other bank or financial institution, (a “Replacement Lender”) selected by Vodafone, and which is acceptable to the Agent (acting reasonably) and which confirms its willingness to assume and does assume all the obligations or all the relevant obligations of the transferring Lender (including the assumption of the transferring Lender’s participations or unfunded participations (as the case may be) on the same basis as the transferring Lender) for a purchase price in cash payable at the time of transfer equal to the outstanding principal amount of such Lender’s participation in the outstanding Advances and all accrued interest, Break Costs and other amounts payable in relation thereto under the Finance Documents.

 

(b)                              Any transfer of rights and obligations of a Defaulting Lender pursuant to this Clause 26.7 shall be subject to the following conditions:

 

(i)                                  Vodafone shall have no right to replace the Agent;

 

(ii)                              neither the Agent nor the Defaulting Lender shall have any obligation to Vodafone to find a Replacement Lender;

 

(iii)        the transfer must take place no later than 45 Business Days after the notice referred to in paragraph (a) above; and

 

in no event shall a Defaulting Lender be required to pay or surrender to the Replacement Lender any of the fees received by the Defaulting Lender pursuant to the Finance Documents.

 

(c)                               An amendment or waiver which relates to this Clause 26 may not be effected without the consent of each Lender.

 

27.                            CHANGES TO THE PARTIES

 

27.1                    Transfers by Obligors

 

(a)                               No Obligor may assign, transfer, novate or dispose of any of, or any interest in, its rights and/or obligations under this Agreement provided that without any further consent from the Lenders or the Agent it may, subject to paragraph (b) below and provided that no Default is continuing or would result from any such transfer, transfer its rights and obligations under this Agreement to NewTopco or any Intermediate Holding Company and NewTopco or the Intermediate Holding Company will execute a document, or documents, in favour of the Lenders in form and substance the same as this Agreement, with references to such Obligor in this Agreement amended to mean NewTopco or such Intermediate Holding Company (as applicable), provided that if such transfer is to an Intermediate Holding Company, the Agent may, within 30 days of receipt of notification of such transfer, require NewTopco to accede as a Guarantor. The Agent shall (and is hereby authorised to) execute on behalf of the Finance Parties any such document or documents executed by NewTopco or the Intermediate Holding Company provided that the conditions set out in this Clause 27.1 are satisfied.

 

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(b)                              The transfer of rights and obligations under this Agreement to NewTopco or any Intermediate Holding Company shall not require the consent of the Lenders or the Agent provided that NewTopco or the Intermediate Holding Company, as applicable, is incorporated and tax resident in the United Kingdom or in the United States and prior to such transfer Vodafone provides satisfactory evidence to the Agent that it is tax resident in one of those jurisdictions. Subject to paragraph (c) below, the prior written consent of the Majority Lenders shall be required in relation to the transfer of rights and obligations to a NewTopco or an Intermediate Holding Company incorporated elsewhere.

 

(c)                               All Lender consent will be required for any transfer of rights under this Agreement to a NewTopco or an Intermediate Holding Company to the extent the transferee is incorporated or established or carrying on its principal business in a country which is subject to OFAC sanctions, United Nations sanctions under Article 41 of the UN Charter, or any equivalent sanctions administered or enforced by the European Union, Her Majesty’s Treasury, the State Secretariat for Economic Affairs, or other relevant sanctions authority.

 

27.2                    Transfers by Lenders

 

(a)                               A Lender (the “Existing Lender”) may at any time assign, transfer or novate any of its rights and/or obligations under this Agreement to another bank, financial institution, central bank or federal reserve (the “New Lender”) provided that:

 

(i)                                  subject to paragraph (b) below Vodafone (or following a Hive Up, NewTopco) has, except while an Event of Default is continuing or in the case of an assignment, transfer or novation to an Affiliate or another Lender, given its prior written consent (in the case of a transfer to a financial institution, such consent to be in its absolute discretion and, in the case of a transfer to a bank, central bank or federal reserve such consent not to be unreasonably withheld or delayed);

 

(ii)                              in the case of a partial assignment, transfer or novation of rights and/or obligations, a minimum amount of U.S.$8,000,000 in aggregate and in multiples of U.S.$1,000,000 (unless to an Affiliate or to a Lender or the Agent agrees otherwise) must be assigned, transferred or novated; and

 

(iii)                          in the case of an assignment, transfer or novation by a Swingline Lender (or an Affiliate of a Swingline Lender), a portion of that Swingline Lender’s Swingline Commitment must also be assigned, transferred or novated to the extent necessary (if at all) to ensure that the Swingline Lender’s Swingline Commitment does not exceed its Commitment after the assignment, transfer or novation.

 

(b)                              Vodafone must respond to a request for its consent to a transfer made under paragraph (a)(i) above as soon as is reasonably practicable and, in any event, no later than 15 Business Days after the day on which it received the request, or Vodafone will be deemed to have given its consent to the transfer.

 

(c)                               A transfer of obligations will be effective only if either:

 

(i)                                  the obligations are novated in accordance with Clause 27.4 (Procedure for novations); or

 

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(ii)                              the New Lender gives prior written notice to Vodafone and, except while an Event of Default is continuing or in the case of an assignment, transfer or novation to an Affiliate or another Lender, obtains the consent of Vodafone in accordance with paragraph (a)(i) above and confirms to the Agent and Vodafone that it undertakes to be bound by the terms of this Agreement as a Lender in form and substance satisfactory to the Agent. On the transfer becoming effective in this manner the Existing Lender shall be relieved of its obligations under this Agreement to the extent that they are transferred to the New Lender; and

 

(iii)                          the Agent has performed all “know your customer” or other checks relating to any person that it is required to carry out in relation to such assignment to a New Lender, the completion of which the Agent shall promptly notify to the Existing Lender and the New Lender.

 

(d)                              Nothing in this Agreement restricts the ability of a Lender to sub-contract an obligation if that Lender remains liable under this Agreement for that obligation.

 

(e)                               On each occasion an Existing Lender assigns, transfers or novates any of its rights and/or obligations under this Agreement (other than to an Affiliate), the New Lender shall, on the date the assignment, transfer and/or novation takes effect, pay to the Agent for its own account a fee of U.S.$3,000.

 

(f)                                An Existing Lender is not responsible to a New Lender for:

 

(i)                                  the execution, genuineness, validity, enforceability or sufficiency of any Finance Document or any other document; or

 

(ii)                              the collectability of amounts payable under any Finance Document; or

 

(iii)                          the accuracy of any statements (whether written or oral) made in connection with any Finance Document.

 

(g)                               Each New Lender confirms to the Existing Lender and the other Finance Parties that it:

 

(i)                                  has made its own independent investigation and assessment of the financial condition and affairs of each Obligor and its related entities in connection with its participation in this Agreement and has not relied exclusively on any information provided to it by the Existing Lender in connection with any Finance Document; and

 

(ii)                              will continue to make its own independent appraisal of the creditworthiness of each Obligor and its related entities while any amount is or may be outstanding under this Agreement or any Commitment is in force.

 

(h)                              Nothing in any Finance Document obliges an Existing Lender to:

 

(i)                                  accept a re transfer from a New Lender of any of the rights and/or obligations assigned, transferred or novated under this Clause 27; or

 

(ii)                              support any losses incurred by the New Lender by reason of the non-performance by any Obligor of its obligations under this Agreement or otherwise.

 

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(i)                                  Any reference in this Agreement to a Lender includes a New Lender but excludes a Lender if no amount is or may be owed to or by it under this Agreement and its Commitment has been cancelled or reduced to nil.

 

(j)                                  If any assignment, transfer or novation results either:

 

(i)                                  at the time of the assignment, transfer or novation; or

 

(ii)                              at any future time where the additional amount was caused as a result of laws and/or regulations in force at the date of the assignment, transfer or novation,

 

in additional amounts becoming due under Clause 11 (Taxes) or amounts becoming due under Clause 13 (Increased Costs), the New Lender shall be entitled to receive such additional amounts only to the extent that the Existing Lender would have been so entitled had there been no such assignment, transfer or novation.

 

27.3                    Affiliates of Lenders

 

(a)                               Each Lender may fulfil its obligations in respect of any Advance through an Affiliate if:

 

(i)                                  the relevant Affiliate is specified in this Agreement as a Lender or becomes a Lender by means of a Novation Certificate in accordance with this Agreement and subject to any consent required under Clause 27.2 (Transfers by Lenders); and

 

(ii)                              the Advances in which that Affiliate will participate are specified in this Agreement or in a notice given by that Lender to the Agent.

 

In this event, the Lender and the Affiliate will participate in Advances in the manner provided for in sub-paragraph (ii) above.

 

(b)                              If paragraph (a) above applies, the Lender and its Affiliate will be treated as having a single Commitment and a single vote, but, for all other purposes, will be treated as separate Lenders.

 

27.4     Procedure for novations

 

(a)        A novation is effected if:

 

(i)                                  the Existing Lender and the New Lender deliver to the Agent a duly completed certificate (a “Novation Certificate”), substantially in the form of Part 1 of Schedule 4, with such amendments as the Agent approves to achieve a substantially similar effect (which may be delivered by fax and confirmed by delivery of a hard copy original but the fax will be effective irrespective of whether confirmation is received); and

 

(ii)                              the Agent executes it (as soon as practicable for it to do so).

 

(b)                              Each Party (other than the Existing Lender and the New Lender) irrevocably authorises the Agent to execute any duly completed Novation Certificate on its behalf.

 

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(c)                               To the extent that they are expressed to be the subject of the novation in the Novation Certificate:

 

(i)                                  the Existing Lender and the other Parties (the “Existing Parties”) will be released from their obligations to each other (the “Discharged Obligations”);

 

(ii)                              the New Lender and the Existing Parties will assume obligations towards each other which differ from the Discharged Obligations only insofar as they are owed to or assumed by the New Lender instead of the Existing Lender;

 

(iii)                          the rights of the Existing Lender against the Existing Parties and vice versa (the “Discharged Rights”) will be cancelled; and

 

(iv)                          the New Lender and the Existing Parties will acquire rights against each other which differ from the Discharged Rights only insofar as they are exercisable by or against the New Lender instead of the Existing Lender,

 

all on the date of execution of the Novation Certificate by the Agent or, if later, the date specified in the Novation Certificate.

 

(d)                              If the effective date of a novation is after the date a Request is received by the Agent but before the date the requested Advance is disbursed to the relevant Borrower, the Existing Lender shall be obliged to participate in that Advance in respect of its Discharged Obligations notwithstanding that novation, and the New Lender shall reimburse the Existing Lender for its participation in that Advance and all interest and fees thereon up to the date of reimbursement (in each case to the extent attributable to the Discharged Obligations) within three Business Days of the Drawdown Date of that Advance.

 

(e)                               The Agent shall only be obliged to execute a Novation Certificate delivered to it by the Existing Lender and the New Lender once it is satisfied it has complied with all necessary “know your customer” or other similar checks under all applicable laws and regulations in relation to the transfer to such New Lender.

 

27.5                    Replacement of Lenders

 

(a)                               In this Clause 27.5:

 

Non-consenting Lender means a Lender which does not agree to a consent or amendment to, or a waiver of, a provision of a Finance Document requested by Vodafone where:

 

(i)                                  the consent, waiver or amendment requires the consent of all the Lenders;

 

(ii)                              a period of not less than 15 Business Days (or such other longer period as agreed from time to time between the Agent and Vodafone) has elapsed from the date the consent, waiver or amendment was requested; and

 

(iii)                          80% of the Lenders have agreed to the consent, waiver or amendment.

 

Prepayment Lender means, at any time, a Lender in respect of which:

 

(i)                                  a Borrower is at that time entitled to serve a notice under Clauses 8.5(a) to (c) (Right of prepayment and cancellation) (inclusive), but has not done so; or

 

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(ii)                              a Borrower becomes obliged to repay any amount in accordance with Clause 14.1 (Illegality).

 

Relevant Lender means:

 

(i)                                  a Prepayment Lender; or

 

(ii)                              a Non-Consenting Lender.

 

Replacement Lender means a Lender or any other bank or financial institution selected by Vodafone which:

 

(i)                                  in the case of a person which is not an existing Lender is acceptable to the Agent (acting reasonably); and

 

(ii)                              is willing to assume all of the obligations of the Relevant Lender.

 

(b)                              Subject to paragraph (e) below, Vodafone may, on giving 10 Business Days’ prior notice to the Agent and a Relevant Lender, require that Relevant Lender to transfer all of its rights and obligations under this Agreement to a Replacement Lender.

 

(c)                               On receipt of a notice under paragraph (b) above the Relevant Lender must transfer all of its rights and obligations under this Agreement:

 

(i)                                  in accordance with Clause 27.2 (Transfers by Lenders);

 

(ii)                              on the date specified in the notice;

 

(iii)                          to the Replacement Lender specified in the notice; and

 

(iv)                          for a purchase price equal to the aggregate of:

 

(A)                           the Relevant Lender’s share in the outstanding Facilities;

 

(B)                            any Break Costs incurred by the Relevant Lender as a result of the transfer; and

 

(C)                            all accrued interest, fees and other amounts payable to the Relevant Lender under this Agreement as at the transfer date.

 

(d)                              No member of the Consolidated Group may make any payment or assume any obligation to or on behalf of the Replacement Lender as an inducement for a Replacement Lender to become a Lender, other than as provided in paragraph (c) above.

 

(e)                               Notwithstanding the above, Vodafone’s right to replace:

 

(i)                                  a Non-Consenting Lender may only be exercised within 45 Business Days after the date the consent, waiver or amendment was requested by Vodafone;

 

(ii)                              a Prepayment Lender may only be exercised whilst it is entitled to serve a notice under Clause 8.5 (Right of prepayment and cancellation) or whilst a Borrower is obliged to make a payment under Clause 14.1 (Illegality) (as applicable); and

 

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(iii)                          a Non-Consenting Lender or Prepayment Lender under this Clause 27.5 shall in no way oblige such Non-Consenting Lender or Prepayment Lender to pay or surrender any of the fees received by such Lender pursuant to the Finance Documents.

 

27.6                    Pro rata interest settlement

 

If the Agent has notified the Lenders that it is able to distribute interest payments on a “pro rata basis” to Existing Lenders and New Lenders then (in respect of any transfer pursuant to Clause 27.2 (Transfers by Lenders) or any novation pursuant to Clause 27.4 (Procedure for novations) the transfer date of which, in each case, is after the date of such notification and is not on the last day of a Term):

 

(a)                               any interest or fees in respect of the relevant participation which are expressed to accrue by reference to the lapse of time shall continue to accrue in favour of the Existing Lender up to but excluding the transfer date (“Accrued Amounts”) and shall become due and payable to the Existing Lender (without further interest accruing on them) on the last day of the current Term (or, if the Term is longer than six Months, on the next of the dates which falls at six monthly intervals after the first day of that Term); and

 

(b)                              the rights assigned or transferred by the Existing Lender will not include the right to the Accrued Amounts so that, for the avoidance of doubt:

 

(i)                                  when the Accrued Amounts become payable, those Accrued Amounts will be payable for the account of the Existing Lender; and

 

(ii)                              the amount payable to the New Lender on that date will be the amount which would, but for the application of this Clause 27.6, have been payable to it on that date, but after deduction of the Accrued Amounts.

 

27.7                    Additional Guarantors

 

(a)                                                                               (i)                                  Vodafone will procure that NewTopco and any Intermediate Holding Company of Vodafone will become an Additional Guarantor on or before the Reorganisation Date by executing and delivering the documents set out in paragraph (iii) below on or before the Reorganisation Date.

 

(ii)                              Subject to Vodafone’s prior written consent, any other member of the Consolidated Group may become an Additional Guarantor.

 

(iii)                          The relevant company will become an Additional Guarantor upon:

 

(A)                           the delivery to the Agent of a Guarantor Accession Agreement duly executed by that company; and

 

(B)                            delivery to the Agent of all those other documents listed in Part 2 of Schedule 2, in each case in the agreed form or in such other form and substance satisfactory to the Agent.

 

(b)                              The execution of a Guarantor Accession Agreement constitutes confirmation by the Additional Guarantor concerned that the representations and warranties set out in Clauses 16.1 (Representations and warranties) to 16.6 (Authorisations) to be made by

 

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it on the date of the Guarantor Accession Agreement are correct, as if made with reference to the facts and circumstances then existing.

 

27.8                    Additional Borrowers

 

(a)                                                                               (i)                                  Any member of the Restricted Group, or following a Hive Up (and subject to the proviso below), NewTopco or any Intermediate Holding Company, in each case, incorporated and tax resident in the United Kingdom or in the United States or, subject to the prior written consent of the Majority Lenders (or, if sub-paragraph (iii) below applies, all the Lenders), elsewhere which Vodafone nominates may become an Additional Borrower, provided that on or prior to the date on which NewTopco or any Intermediate Holding Company accedes as an Additional Borrower it also accedes as an Additional Guarantor.

 

(ii)                              The relevant member of the Restricted Group (or NewTopco or any Intermediate Holding Company, as applicable) will become an Additional Borrower upon:

 

(A)                           the delivery to the Agent of a Borrower Accession Agreement duly executed by that member of the Restricted Group (or NewTopco or any Intermediate Holding Company, as applicable); and

 

(B)                            delivery to the Agent of all those other documents listed in Part 3 of Schedule 2, in each case in the agreed form or in such other form and substance satisfactory to the Agent.

 

(iii)                          All Lender consent will be required for any Additional Borrower to the extent the Additional Borrower is incorporated or established or carrying on its principal business in a country which is subject to OFAC sanctions, United Nations sanctions under Article 41 of the UN Charter or any equivalent sanctions administered or enforced by the European Union, Her Majesty’s Treasury or other relevant sanctions authority.

 

(b)                              The execution of a Borrower Accession Agreement constitutes confirmation by the Additional Borrower concerned that the representations and warranties set out in Clauses 16.1 (Representations and warranties) to 16.6 (Authorisations) to be made by it on the date of the Borrower Accession Agreement are correct, as if made with reference to the facts and circumstances then existing.

 

27.9                    Removal of Borrowers

 

(a)                               Any Borrower (other than Vodafone (subject to paragraph (b) below) or, if applicable, NewTopco) which has no liabilities to the Finance Parties in respect of outstanding Advances or any other liabilities to the Finance Parties under the Finance Documents (other than as a Guarantor) may, at the request of Vodafone and if no Default is outstanding or will result from such action, cease to be a Borrower by entering into a supplemental agreement to this Agreement at the cost of Vodafone in such form as the Agent may reasonably require which shall discharge that Borrowers’ obligations as a Borrower under this Agreement.

 

(b)                              If on the Reorganisation Date:

 

(i)                                  NewTopco and any Intermediate Holding Company has acceded as a Guarantor in accordance with Clause 27.7 (Additional Guarantors);

 

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(ii)                              Vodafone has no liabilities to the Finance Parties in respect of outstanding Advances or any other liabilities to the Finance Parties under the Finance Documents (other than as a Guarantor); and

 

(iii)                          no Default is continuing,

 

Vodafone may cease to be a Borrower with effect from the Reorganisation Date by entering into a supplemental agreement to this Agreement at the cost of Vodafone or NewTopco in such form as the Agent may reasonably require which shall discharge Vodafone’s obligations as a Borrower under this Agreement.

 

27.10            Reference Banks

 

If a Reference Bank (or, if a Reference Bank is not a Lender, the Lender of which it is an Affiliate) ceases to be a Lender, the Agent shall (in consultation with Vodafone) appoint another Lender or an Affiliate of a Lender which is not a Reference Bank to replace that Reference Bank.

 

27.11            Register

 

The Agent, acting solely for this purpose as agent of the Borrowers, shall keep a register of all the Parties including in the case of Lenders, their respective commitments, the obligations owing to each, and the details of their Facility Office notified to the Agent from time to time, and shall supply any other Party (at that Party’s expense) with a copy of the register on request.

 

The Agent shall record in the register any transfer by an Obligor or by a Lender described in Clause 27.1(a) or (b) (Transfers by Obligors) or 27.2 (Transfers by Lenders), respectively, and any other modification to the Borrowers, Lenders, Guarantors, or outstanding obligations. The Agent shall record the names and addresses of each Lender and the respective Commitments of and obligations owing to each Lender. The entries in the register shall, in the absence of manifest error, be conclusive and each Obligor, the Agent, and each Lender shall treat each person whose name is recorded in the register as a Lender notwithstanding any notice to the contrary. The register shall be available for inspection by each Obligor at any reasonable time and from time to time upon reasonable prior notice.

 

27.12            Security over Lenders’ rights

 

In addition to the other rights provided to Lenders under this Clause 27, each Lender may at any time charge, assign or otherwise create Security in or over (whether by way of collateral or otherwise) all or any of its rights under any Finance Document to secure obligations of that Lender including, without limitation:

 

(a)                               any charge, assignment or other Security to secure obligations to a federal reserve or central bank; and

 

(b)                              with the prior written consent of Vodafone (or following a Hive Up, NewTopco), such consent not to be unreasonably withheld or delayed, in the case of any Lender which is a fund, any charge, assignment or other Security granted to any holders (or trustee or representatives of holders) of obligations owed, or securities issued, by that Lender as security for those obligations or securities,

 

except that no such charge, assignment or Security shall:

 

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(i)                                  release a Lender from any of its obligations under the Finance Documents or substitute the beneficiary of the relevant charge, assignment or other Security for the Lender as a party to any of the Finance Documents; or

 

(ii)                              require any payments to be made by an Obligor or grant to any person any more extensive rights than those required to be made or granted to the relevant Lender under the Finance Documents.

 

28.                            DISCLOSURE OF INFORMATION

 

28.1                    Disclosure

 

(a)                               A Lender may disclose to any of its Affiliates, directors, employees, officers, professional advisers or auditors; any person to whom or for whose benefit a Lender charges, assigns or otherwise creates security (or may do so) pursuant to Clause 27.12 (Security over Lenders’ rights); or any person with whom it is proposing to enter, or has entered into, any kind of transfer, participation or other agreement in relation to this Agreement:

 

(i)                                  a copy of any Finance Document; and

 

(ii)        any information which that Lender has acquired under or in connection with any Finance Document,

 

provided that a Lender shall not disclose any such information:

 

(A)                                to any of its Affiliates, directors, employees, officers, professional advisers or auditors or a federal reserve or central bank, unless the recipient is informed that such information is confidential; or

 

(B)                                to any other person, unless that person has provided to that Lender a confidentiality undertaking addressed to that Lender and Vodafone substantially in the form of Schedule 5 or such other form as Vodafone may approve.

 

(b)                              Paragraphs 1(a), 1(c), 2(b), 3, 6, 8, 9 and 12 of Schedule 5 (Form of Confidentiality Undertaking from New Lender) shall be deemed to be incorporated herein as if set out in full (mutatis mutandis), but as if references therein to “we”, “us” or “our” were to each Finance Party and references to “you” were to Vodafone and as if the Confidential Information included in any Funding Rate or Reference Bank Quotation.

 

28.2                    Disclosure to numbering service providers

 

(a)                               Any Finance Party may disclose to any national or international numbering service provider appointed by that Finance Party to provide identification numbering services in respect of this Agreement, the Facilities and/or one or more Obligors the following information:

 

(i)                                  names of Obligors;

 

(ii)                              country of domicile of Obligors;

 

(iii)                          place of incorporation of Obligors;

 

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(iv)                          date of this Agreement;

 

(v)                              the name of the Agent and the Arranger;

 

(vi)                          date of each amendment and restatement of this Agreement;

 

(vii)                      amount of Total Commitments;

 

(viii)                  currencies of the Facilities;

 

(ix)                          type of Facilities;

 

(x)                              ranking of Facilities;

 

(xi)                          Maturity Date for the Facilities;

 

(xii)                      changes to any of the information previously supplied pursuant to paragraphs (i) to (xi) above (inclusive); and

 

(xiii)                  such other information agreed between such Finance Party and Vodafone,

 

to enable such numbering service provider to provide its usual syndicated loan numbering identification services.

 

(b)                              The Parties acknowledge and agree that each identification number assigned to this Agreement, the Facilities and/or one or more Obligors by a numbering service provider and the information associated with each such number may be disclosed to users of its services in accordance with the standard terms and conditions of that numbering service provider.

 

(c)                               If requested, the Agent shall notify Vodafone and the other Finance Parties of:

 

(i)                                  the name of any numbering service provider appointed by the Agent in respect of this Agreement, the Facilities and/or one or more Obligors; and

 

(ii)                              the number or, as the case may be, numbers assigned to this Agreement, the Facilities and/or one or more Obligors by such numbering service provider.

 

28.3                    Confidentiality of Funding Rates and Reference Bank Quotations

 

(a)                               Confidentiality and Disclosure

 

(i)                                  The Agent and each Obligor agree to keep each Funding Rate (and, in the case of the Agent, each Reference Bank Quotation) confidential and not to disclose it to anyone, save to the extent permitted by paragraphs (ii), (iii) and (iv) below.

 

(ii)                              The Agent may disclose:

 

(A)                           any Funding Rate (but not, for the avoidance of doubt, any Reference Bank Quotation) to Vodafone pursuant to Clause 9.4 (Notification of rates of interest); and

 

(B)                            any Funding Rate or any Reference Bank Quotation to any person appointed by it to provide administration services in respect of one or

 

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more of the Finance Documents to the extent necessary to enable such service provider to provide those services if the service provider to whom that information is to be given has entered into a confidentiality agreement substantially in the form of the LMA Master Confidentiality Undertaking for Use With Administration/Settlement Service Providers or such other form of confidentiality undertaking agreed between the Agent and the relevant Lender or Reference Bank, as the case may be.

 

(iii)                          The Agent may disclose any Funding Rate or any Reference Bank Quotation, and each Obligor may disclose any Funding Rate, to:

 

(A)                           any of its Affiliates and any of its or their officers, directors, employees, professional advisers, auditors, partners and representatives if any person to whom that Funding Rate or Reference Bank Quotation is to be given pursuant to this paragraph (A) is informed in writing of its confidential nature and that it may be price-sensitive information except that there shall be no such requirement to so inform if the recipient is subject to professional obligations to maintain the confidentiality of that Funding Rate or Reference Bank Quotation or is otherwise bound by requirements of confidentiality in relation to it;

 

(B)                            any person to whom information is required or requested to be disclosed by any court of competent jurisdiction or any governmental, banking, taxation or other regulatory authority or similar body, the rules of any relevant stock exchange or pursuant to any applicable law or regulation if the person to whom that Funding Rate or Reference Bank Quotation is to be given is informed in writing of its confidential nature and that it may be price-sensitive information except that there shall be no requirement to so inform if, in the opinion of the Agent or the relevant Obligor, as the case may be, it is not practicable to do so in the circumstances;

 

(C)                            any person to whom information is required to be disclosed in connection with, and for the purposes of, any litigation, arbitration, administrative or other investigations, proceedings or disputes if the person to whom that Funding Rate or Reference Bank Quotation is to be given is informed in writing of its confidential nature and that it may be price-sensitive information except that there shall be no requirement to so inform if, in the opinion of the Agent or the relevant Obligor, as the case may be, it is not practicable to do so in the circumstances; and

 

(D)                           any person with the consent of the relevant Lender or Reference Bank, as the case may be.

 

(iv)                          The Agent’s obligations in this Clause 28.3 relating to Reference Bank Quotations are without prejudice to its obligations to make notifications under Clause 9.4 (Notification of rates of interest) provided that (other than pursuant to paragraph (ii)(A) above) the Agent shall not include the details of any individual Reference Bank Quotation as part of any such notification.

 

(b)                              Other Obligations

 

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(i)                                  The Agent and each Obligor acknowledge that each Funding Rate (and, in the case of the Agent, each Reference Bank Quotation) is or may be price-sensitive information and that its use may be regulated or prohibited by applicable legislation including securities law relating to insider dealing and market abuse and the Agent and each Obligor undertake not to use any Funding Rate or, in the case of the Agent, any Reference Bank Quotation for any unlawful purpose.

 

(ii)                              The Agent and each Obligor agree (to the extent permitted by law and regulation) to inform the relevant Lender or Reference Bank, as the case may be:

 

(A)                           of the circumstances of any disclosure made pursuant to paragraphs (a)(iii)(B) or (a)(iii)(C) above except where such disclosure is made to any of the persons referred to in that paragraph during the ordinary course of its supervisory or regulatory function; and

 

(B)                            upon becoming aware that any information has been disclosed in breach of this Clause 28.3

 

28.4                    No Event of Default

 

No Event of Default will occur under Clause 19.3 (Breach of other obligations) by reason only of an Obligor’s failure to comply with this Clause 28.

 

29.                            SET-OFF

 

29.1                    Contractual set-off

 

Whilst an Event of Default subsists each Obligor authorises each Finance Party to apply any credit balance to which that Obligor is entitled on any account of that Obligor with that Finance Party or any other sum due and payable by that Lender to that Obligor in satisfaction of any sum due and payable from that Obligor to that Finance Party under the Finance Documents but unpaid. For this purpose, each Finance Party is authorised to purchase with the moneys standing to the credit of any such account such other currencies as may be necessary to effect such application.

 

29.2                    Set-off not mandatory

 

No Finance Party shall be obliged to exercise any right given to it by Clause 29.1 (Contractual set-off).

 

29.3                    Notice of set-off

 

Any Finance Party exercising its rights under Clause 29.1 (Contractual set-off) shall notify Vodafone promptly after set-off is applied.

 

29.4                    Set-off by Obligors

 

Any Obligor may at any time on or after a Lender becomes a Defaulting Lender set off amounts owed by that Obligor to that Lender under the Finance Documents against any credit balance on any account of that Obligor with that Lender or any other sum due and payable by that Lender to that Obligor (regardless of the place of payment, booking branch or currency of either obligation). If the obligations are in different currencies, that Obligor may convert

 

105

 

either obligation at the Agent’s Spot Rate of Exchange (or, if there is no such rate, at a market rate of exchange reasonably selected by Vodafone) for the purpose of the set-off. If an Obligor exercises such rights of set off: (i) it shall notify the Lender promptly thereafter; and (ii) the Lender shall treat any such obligation owed by the Lender to that Obligor as if it was a payment received by the Lender from that Obligor in accordance with the provisions of this Agreement.

 

30.                            PRO RATA SHARING

 

30.1                    Redistribution

 

If any amount owing by an Obligor under any Finance Document to a Finance Party (the “Recovering Finance Party”) is discharged by payment, set-off or any other manner other than through the Agent in accordance with Clause 10 (Payments) (a “Recovery”), then:

 

(a)                               the Recovering Finance Party shall, within three Business Days, notify details of the Recovery to the Agent;

 

(b)                              the Agent shall determine whether the Recovery is in excess of the amount which the Recovering Finance Party would have received had the Recovery been received by the Agent and distributed in accordance with Clause 10 (Payments);

 

(c)                               subject to Clause 30.3 (Exceptions), the Recovering Finance Party shall, within three Business Days of demand by the Agent, pay to the Agent an amount (the “Redistribution”) equal to the excess;

 

(d)                              the Agent shall treat the Redistribution as if it were a payment by the Obligor concerned under Clause 10 (Payments) and shall pay the Redistribution to the Finance Parties (other than the Recovering Finance Party) in accordance with Clause 10.8 (Partial payments); and

 

(e)                               after payment of the full Redistribution, the Recovering Finance Party will be subrogated to the portion of the claims paid under paragraph (d) above, and that Obligor will owe the Recovering Finance Party a debt which is equal to the Redistribution, immediately payable and of the type originally discharged.

 

30.2                    Reversal of redistribution

 

If under Clause 30.1 (Redistribution):

 

(a)                               a Recovering Finance Party must subsequently return a Recovery, or an amount measured by reference to a Recovery, to an Obligor; and

 

(b)                              the Recovering Finance Party has paid a Redistribution in relation to that Recovery,

 

each Finance Party shall, within three Business Days of demand by the Recovering Finance Party through the Agent, reimburse the Recovering Finance Party all or the appropriate portion of the Redistribution paid to that Finance Party. Thereupon the subrogation in Clause 30.1(e) (Redistribution) will operate in reverse to the extent of the reimbursement.

 

106

 

30.3                    Exceptions

 

(a)                               A Recovering Finance Party need not pay a Redistribution to the extent that it would not, after the payment, have a valid claim against the Obligor concerned in the amount of the Redistribution pursuant to Clause 30.1(e) (Redistribution).

 

(b)                              A Recovering Finance Party is not obliged to share with any other Finance Party any amount which the Recovering Finance Party has received or recovered as a result of taking legal proceedings, if the other Finance Party had an opportunity to participate in those legal proceedings but did not do so and did not take separate legal proceedings.

 

31.                            SEVERABILITY

 

If a provision of any Finance Document is or becomes illegal, invalid or unenforceable in any jurisdiction, that shall not affect:

 

(a)         the legality, validity or enforceability in that jurisdiction of any other provision of the Finance Documents; or

 

(b)                              the legality, validity or enforceability in other jurisdictions of that or any other provision of the Finance Documents.

 

32.                            COUNTERPARTS

 

This Agreement may be executed in any number of counterparts, and this has the same effect as if the signatures on the counterparts were on a single copy of this Agreement.

 

33.                            NOTICES

 

33.1                    Giving of notices

 

(a)                               All notices or other communications under or in connection with this Agreement shall be given in writing or by facsimile. Any such notice will be deemed to be given as follows:

 

(i)                                  if in writing, when delivered; and

 

(ii)                              if by facsimile, when received.

 

However, a notice given in accordance with the above but received on a non-working day or after business hours in the place of receipt will only be deemed to be given on the next working day in that place.

 

(b)                              Any Party may agree with any other Party to give and receive notices by telex in which case the notice will be deemed given when the correct answerback is received.

 

33.2                    Addresses for notices

 

(a)                               The address and facsimile number of each Party (other than the Agent, the U.S. Swingline Agent and Vodafone) for all notices under or in connection with this Agreement are:

 

(i)                                  that notified by that Party for this purpose to the Agent on or before it becomes a Party; or

 

107

 

(ii)                              any other notified by that Party for this purpose to the Agent by not less than five Business Days’ notice.

 

(b)                              The address and facsimile numbers of the Agent are:

 

For Operational Matters (such as Drawdowns, Interest Rate Fixing, Interest/fee calculations and payments)

 

The Royal Bank of Scotland plc

1 Hardman Boulevard

Manchester

Greater Manchester

M3 3AQ

 

	
Contact:
    	
 
    	
Lending   Operations
    
	
Facsimile:
    	
 
    	
020 3043 6688
    
	
Email:
    	
 
    	
RbsAgencyOperations@rbs.com
    

 

For Non Operational Matters (such as documentation; covenant compliance; amendments & waivers)

 

The Royal Bank of Scotland plc

250 Bishopsgate

London

EC2M 4AA

 

	
Contact:
    	
 
    	
Jayne Tobin
    
	
Telephone:
    	
 
    	
020 7678 3668
    
	
Facsimile:
    	
 
    	
020 786 5247
    
	
Email:
    	
 
    	
Jayne.tobin@rbs.com
    

 

or such other as the Agent may notify to the other Parties by not less than five Business Days’ notice.

 

(c)                               The address and facsimile numbers of the U.S. Swingline Agent are:

 

Primary Operations Contact:

 

RBS Americas HQ

600 Washington Boulevard

Stamford, CT 06901

U.S.A

 

	
Contact:
    	
 
    	
Sheila Shaw
    
	
Facsimile:
    	
 
    	
+1 203 873 5300
    
	
Email:
    	
 
    	
gbmnaagency@rbs.com
    

 

or such other as the U.S. Swingline Agent may notify to the other Parties by not less than five Business Days’ notice.

 

(d)                              The address, facsimile number and website of Vodafone are:

 

Vodafone Group Plc

One Kingdom Street

 

108

 

Paddington Central

London

W2 6BY

 

	
Contact:
    	
 
    	
Group Treasury   Director
    
	
Telephone:
    	
 
    	
07879496611
    
	
Facsimile:
    	
 
    	
01635 676 746
    
	
Email:
    	
 
    	
neil.garrod@vodafone.com
    

 

Website: http://www.vodafone.com/start/investor_relations/financial_reports. html

 

or such other as Vodafone may notify to the other Parties by not less than five Business Days’ notice.

 

(e)                               The Agent shall, promptly upon request from any Party, give to that Party the address or facsimile number of any other Party applicable at the time for the purposes of this Clause 33.

 

33.3                    Communication when Agent or U.S. Swingline Agent is Impaired Agent

 

If the Agent or, as the case may be, the U.S. Swingline Agent is an Impaired Agent the Parties may, instead of communicating with each other through the Agent or, as the case may be, the U.S. Swingline Agent, communicate with each other directly and (while the Agent or the U.S. Swingline Agent is an impaired Agent) all the provisions of the Finance Documents which require communications to be made or notices to be given to or by the Agent shall be varied so that communications may be made and notices given to or by the relevant Parties directly. This provision shall not operate after a successor Agent or, as the case may be, successor U.S. Swingline Agent has been appointed.

 

34.                            LANGUAGE

 

(a)                               Any notice given under or in connection with any Finance Document shall be in English.

 

(b)                              All other documents provided under or in connection with any Finance Document shall be:

 

(i)                                  in English; or

 

(ii)                              if not in English, accompanied by a certified English translation and, in this case, the English translation shall prevail unless the document is a statutory or other official document.

 

35.                            JURISDICTION

 

35.1                    Submission

 

(a)                               Each Party agrees that the courts of England have exclusive jurisdiction to settle any disputes in connection with any Finance Document or any non-contractual obligation arising out of or in connection with any Finance Document and accordingly submits to the jurisdiction of the English courts.

 

(b)                              Notwithstanding paragraph (a) above, for the benefit of the Finance Parties, any New York State court or U.S. Federal court sitting in the City and County of New York

 

109

 

also has jurisdiction to settle any dispute in connection with any Finance Document involving a U.S. Obligor, and each U.S. Obligor submits to the jurisdiction of those courts.

 

(c)                               The English courts and (in respect of a dispute involving a U.S. Obligor) New York courts are the most appropriate and convenient courts to settle any such dispute and each Obligor and U.S. Obligor, as applicable, waives objection to those courts on the grounds of inconvenient forum or otherwise in relation to proceedings in connection with any Finance Document.

 

35.2                    Service of process

 

(a)                               Without prejudice to any other mode of service, each Obligor (other than an Obligor incorporated in England and Wales):

 

(i)                                  irrevocably appoints Vodafone as its agent for service of process relating to any proceedings before the English courts in connection with any Finance Document (and Vodafone accepts this appointment);

 

(ii)                              agrees that failure by a process agent to notify the relevant Obligor of the process will not invalidate the proceedings concerned;

 

(iii)                          consents to the service of process relating to any such proceedings by prepaid posting of a copy of the process to its address for the time being applying under Clause 33.2 (Addresses for notices); and

 

(iv)                          agrees that if the appointment of any person mentioned in paragraph (i) or (ii) above ceases to be effective, the relevant Obligor shall immediately appoint a further person in England to accept service of process on its behalf in England and, failing such appointment within 15 days, the Agent is entitled to appoint such a person by notice to Vodafone.

 

(b)                              Prior to the accession of a US Obligor who is not incorporated or having a place of business in New York State such US Obligor must appoint an agent for service of process in any proceedings before any court located in the State of New York on terms reasonably satisfactory to the Agent.

 

35.3                    Forum convenience and enforcement abroad

 

Each Obligor:

 

(a)                               waives objection to the English courts on grounds of inconvenient forum or otherwise as regards proceedings in connection with a Finance Document; and

 

(b)                              agrees that a judgment or order of an English court in connection with a Finance Document is conclusive and binding on it and may be enforced against it in the courts of any other jurisdiction.

 

35.4                    Non-exclusivity

 

Nothing in this Clause 35 limits the right of a Finance Party to bring proceedings against an Obligor in connection with any Finance Document:

 

(a)                               in any other court of competent jurisdiction; or

 

110

 

(b)                              concurrently in more than one jurisdiction.

 

36.                            GOVERNING LAW

 

This Agreement and any non-contractual obligations arising out of or in connection with it are governed by English law.

 

37.                            USA PATRIOT ACT

 

Each Finance Party that is subject to the requirements of the USA Patriot Act hereby notifies each Obligor that pursuant to the requirements of the USA Patriot Act, prior to making an Advance hereunder, it is required to obtain, verify and record information that identifies the Obligors, which information includes the name and address of the Obligors and other information that will allow such Finance Party to identify the Obligors in accordance with the USA Patriot Act. Each Obligor agrees that it will provide each Finance Party with such information as it may request in order for such Finance Party to satisfy the requirements of the USA Patriot Act.

 

38.                            WAIVER OF TRIAL BY JURY

 

EACH PARTY WAIVES ANY RIGHT IT MAY HAVE TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION IN CONNECTION WITH ANY FINANCE DOCUMENT OR ANY TRANSACTION CONTEMPLATED BY ANY FINANCE DOCUMENT. THIS AGREEMENT MAY BE FILED AS A WRITTEN CONSENT TO TRIAL BY THE COURT.

 

THIS AGREEMENT has been entered into on the date stated at the beginning of this Agreement.

 

111

 

SCHEDULE 1

 

LENDERS AND COMMITMENTS

 

PART 1

 

LENDERS AND COMMITMENTS

 

Commitments

U.S.$

 

	
Original   Lender
    	
Commitment
    
	
 
    	
(U.S.$)
    
	
 
    	
 
    
	
 
    	
 
    
	
ABBEY NATIONAL   TREASURY SERVICES PLC (TRADING AS SANTANDER GLOBAL BANKING AND MARKETS)
    	
155,000,000
    
	
 
    	
 
    
	
AUSTRALIA AND   NEW ZEALAND BANKING GROUP LIMITED
    	
75,000,000
    
	
 
    	
 
    
	
BANCO BILBAO VIZCAYA ARGENTARIA, S.A., LONDON   BRANCH
    	
155,000,000
    
	
 
    	
 
    
	
BANCO DE SABADELL S.A., LONDON BRANCH
    	
75,000,000
    
	
 
    	
 
    
	
BANK OF AMERICA   MERRILL LYNCH INTERNATIONAL LIMITED
    	
155,000,000
    
	
 
    	
 
    
	
(BANK OF   AMERICA, N.A. IN RESPECT OF ANY ADVANCES TO A BORROWER INCORPORATED IN THE   UNITED STATES)
    	
 
    
	
 
    	
 
    
	
BANK OF CHINA   LIMITED, LONDON BRANCH
    	
155,000,000
    
	
 
    	
 
    
	
BARCLAYS BANK   PLC
    	
155,000,000
    
	
 
    	
 
    
	
BNP PARIBAS,   LONDON BRANCH
    	
155,000,000
    
	
 
    	
 
    
	
CITIBANK, N.A., LONDON   BRANCH
    	
155,000,000
    
	
 
    	
 
    
	
COMMERZBANK   AKTIENGESELLSCHAFT, LONDON BRANCH
    	
155,000,000
    
	
 
    	
 
    
	
DEUTSCHE BANK   LUXEMBOURG S.A.
    	
155,000,000
    
	
 
    	
 
    
	
GOLDMAN SACHS   BANK USA
    	
155,000,000
    
	
 
    	
 
    
	
HSBC BANK PLC
    	
155,000,000
    
	
 
    	
 
    
	
ING BANK N.V.,   LONDON BRANCH
    	
155,000,000
    
	
 
    	
 
    
	
INTESA SANPAOLO S.P.A.
    	
155,000,000
    
	
 
    	
 
    
	
JPMORGAN CHASE   BANK, N.A., LONDON BRANCH
    	
155,000,000
    

 

112

 

	
LLOYDS BANK PLC
    	
155,000,000
    
	
 
    	
 
    
	
MIZUHO BANK, LTD
    	
155,000,000
    
	
 
    	
 
    
	
MORGAN STANLEY   SENIOR FUNDING, INC
    	
155,000,000
    
	
 
    	
 
    
	
NATIONAL   AUSTRALIA BANK LIMITED
    	
75,000,000
    
	
 
    	
 
    
	
SOCIETE   GENERALE, LONDON BRANCH
    	
75,000,000
    
	
 
    	
 
    
	
STANDARD   CHARTERED BANK
    	
75,000,000
    
	
 
    	
 
    
	
SUMITOMO MITSUI   BANKING CORPORATION
    	
155,000,000
    
	
 
    	
 
    
	
TD BANK EUROPE   LIMITED
    	
75,000,000
    
	
 
    	
 
    
	
THE BANK OF NEW   YORK MELLON
    	
75,000,000
    
	
 
    	
 
    
	
THE BANK OF   TOKYO-MITSUBISHI UFJ, LTD.
    	
155,000,000
    
	
 
    	
 
    
	
THE ROYAL BANK   OF SCOTLAND PLC
    	
155,000,000
    
	
 
    	
 
    
	
UBS AG, LONDON   BRANCH
    	
155,000,000
    
	
 
    	
 
    
	
UNICREDIT BANK   AG
    	
155,000,000
    
	
 
    	
 
    
	
Total
    	
3,935,000,000
    

 

113

 

PART 2

 

SWINGLINE LENDERS AND SWINGLINE COMMITMENTS

 

	
Swingline   Lender
    	
Swingline
    
	
 
    	
Commitments
    
	
 
    	
U.S.$
    
	
 
    	
 
    
	
ABBEY NATIONAL   TREASURY SERVICES PLC (TRADING AS SANTANDER GLOBAL BANKING AND MARKETS)
    	
75,000,000
    
	
 
    	
 
    
	
BANCO BILBAO VIZCAYA ARGENTARIA, S.A., LONDON   BRANCH
    	
75,000,000
    
	
 
    	
 
    
	
BANK OF AMERICA   N.A.
    	
75,000,000
    
	
 
    	
 
    
	
BANK OF CHINA   LIMITED, LONDON BRANCH
    	
75,000,000
    
	
 
    	
 
    
	
BARCLAYS BANK   PLC
    	
75,000,000
    
	
 
    	
 
    
	
BNP PARIBAS
    	
75,000,000
    
	
 
    	
 
    
	
CITIBANK, N.A.
    	
75,000,000
    
	
 
    	
 
    
	
COMMERZBANK   AKTIENGESELLSCHAFT, NEW YORK BRANCH
    	
75,000,000
    
	
 
    	
 
    
	
DEUTSCHE BANK   LUXEMBOURG S.A. C/O DEUTSCHE BANK AG NEW YORK BRANCH
    	
75,000,000
    
	
 
    	
 
    
	
GOLDMAN SACHS   BANK USA
    	
75,000,000
    
	
 
    	
 
    
	
HSBC BANK PLC
    	
75,000,000
    
	
 
    	
 
    
	
ING BANK N.V.,   DUBLIN BRANCH
    	
75,000,000
    
	
 
    	
 
    
	
INTESA SANPAOLO S.P.A.
    	
75,000,000
    
	
 
    	
 
    
	
JPMORGAN CHASE   BANK, N.A., NEW YORK BRANCH
    	
75,000,000
    
	
 
    	
 
    
	
LLOYDS BANK PLC
    	
75,000,000
    
	
 
    	
 
    
	
MIZUHO BANK, LTD
    	
75,000,000
    
	
 
    	
 
    
	
MORGAN STANLEY   SENIOR FUNDING, INC
    	
75,000,000
    
	
 
    	
 
    
	
SUMITOMO MITSUI   BANKING CORPORATION
    	
75,000,000
    
	
 
    	
 
    
	
THE BANK OF   TOKYO-MITSUBISHI UFJ, LTD.
    	
75,000,000
    
	
 
    	
 
    
	
THE ROYAL BANK   OF SCOTLAND PLC
    	
75,000,000
    
	
 
    	
 
    
	
UBS AG, STAMFORD   BRANCH
    	
75,000,000
    

 

114

 

	
UNICREDIT BANK   AG
    	
75,000,000
    
	
 
    	
 
    
	
Total
    	
1,650,000,000
    

 

115

 

PART 3

 

MANDATED LEAD ARRANGERS

 

ABBEY NATIONAL TREASURY SERVICES PLC (TRADING AS SANTANDER GLOBAL BANKING AND MARKETS)

 

BANCO BILBAO VIZCAYA ARGENTARIA, S.A.

 

BANK OF AMERICA MERRILL LYNCH INTERNATIONAL LIMITED

 

BANK OF CHINA LIMITED, LONDON BRANCH

 

BARCLAYS BANK PLC

 

BNP PARIBAS, LONDON BRANCH

 

CITIBANK, N.A., LONDON BRANCH

 

COMMERZBANK AKTIENGESELLSCHAFT, LONDON BRANCH

 

DEUTSCHE BANK LUXEMBOURG S.A.

 

GOLDMAN SACHS BANK USA

 

HSBC BANK PLC

 

ING BANK N.V., LONDON BRANCH

 

INTESA SANPAOLO S.P.A.

 

J.P. MORGAN LIMITED

 

LLOYDS BANK PLC

 

MIZUHO BANK, LTD

 

MORGAN STANLEY BANK INTERNATIONAL LIMITED

 

SUMITOMO MITSUI BANKING CORPORATION

 

THE BANK OF TOKYO-MITSUBISHI UFJ, LTD.

 

THE ROYAL BANK OF SCOTLAND PLC

 

UBS LIMITED

 

UNICREDIT BANK AG

 

116

 

PART 4

 

CO-ARRANGERS

 

AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED

 

BANCO DE SABADELL S.A., LONDON BRANCH

 

NATIONAL AUSTRALIA BANK LIMITED

 

SOCIETE GENERALE, LONDON BRANCH

 

STANDARD CHARTERED BANK

 

THE BANK OF NEW YORK MELLON

 

THE TORONTO-DOMINION BANK

 

117

 

SCHEDULE 2

 

CONDITIONS PRECEDENT DOCUMENTS

 

PART 1

 

TO BE DELIVERED BEFORE THE FIRST ADVANCE

 

1.                                    Constitutional documents

 

A copy of the memorandum and articles of association and certificate of incorporation of Vodafone.

 

2.                                    Authorisations

 

(a)                               A copy of a resolution of the board of directors of Vodafone or, if applicable, of a committee of the board of directors (together with a copy of the resolution of the board of directors constituting that committee):

 

(i)                                  approving the terms of, and the transactions contemplated by, this Agreement and the Fee Letters and resolving that it execute and, where applicable, deliver this Agreement and the Fee Letters;

 

(ii)                              authorising a specified person or persons to execute and, where applicable, deliver this Agreement and the Fee Letters on its behalf; and

 

(iii)                          authorising a specified person or persons, on its behalf, to sign and/or despatch all documents and notices (including Requests) to be signed and/or despatched by it under or in connection with the Finance Documents;

 

(b)                              a specimen of the signature of each person authorised by the resolution referred to in paragraph (a) above;

 

(c)                               a certificate of an authorised signatory of Vodafone confirming that as at the first Drawdown Date the borrowing of the Total Commitments in full and the borrowing of the Total Commitments under (and as defined in) the 2019 Facility in full would not together cause any borrowing limit or limit on the giving of guarantees binding on it to be exceeded (whether as a result of such limit having been waived or otherwise);

 

(d)                              a certificate of an authorised signatory of Vodafone certifying that each copy document specified in this Part 1 of Schedule 2 and supplied by Vodafone is correct, complete and in full force and effect as at a date no earlier than the Signing Date.

 

3.                                    Legal opinions

 

A legal opinion of Allen & Overy LLP, English law counsel to the Agent, in relation to English law.

 

4.                                    Fee Letter

 

Duly executed Fee Letters referred to in paragraphs (a) and (b) of the definition of “Fee Letters”.

 

118

 

PART 2

 

TO BE DELIVERED BY AN ADDITIONAL GUARANTOR

 

1.                                    A Guarantor Accession Agreement, duly executed (if appropriate, under seal) by the Additional Guarantor.

 

2.                                    A copy of the memorandum (if applicable) and articles of association and certificate of incorporation (or other equivalent constitutional documents) of the Additional Guarantor.

 

3.                                    A copy of a resolution of the board of directors of the Additional Guarantor:

 

(a)                               approving the terms of, and the transactions contemplated by, the Guarantor Accession Agreement and resolving that it execute the Guarantor Accession Agreement as a deed;

 

(b)                              authorising a specified person or persons to execute the Guarantor Accession Agreement as a deed; and

 

(c)                               authorising a specified person or persons, on its behalf, to sign and/or despatch all documents to be signed and/or despatched by it under or in connection with this Agreement.

 

4.                                    If the Additional Guarantor is not NewTopco and the lawyers referred to in paragraph 10 below advise it to be necessary or desirable, a copy of a resolution, signed by all the holders of the issued or allotted shares in the Additional Guarantor, approving the terms of, and the transactions contemplated by, the Guarantor Accession Agreement.

 

5.                                    If the Additional Guarantor is not NewTopco, a copy of a resolution of the board of directors of each corporate shareholder in the Additional Guarantor:

 

(a)                               approving the terms of the resolution referred to in paragraph 4 above; and

 

(b)                              authorising a specified person or persons to sign the resolution on its behalf.

 

6.                                    A certificate of a director of the Additional Guarantor certifying that the borrowing of the Total Commitments in full and the borrowing of the Total Commitments under (and as defined in) the 2019 Facility in full would not together cause any borrowing limit or limit on the giving of guarantees binding on it to be exceeded (whether as a result of such limit being waived or otherwise).

 

7.                                    A copy of any other authorisation or other document, opinion or assurance which the Agent considers to be necessary or desirable in connection with the entry into and performance of, and the transactions contemplated by, the Guarantor Accession Agreement or for the validity and enforceability of any Finance Document.

 

8.                                    A specimen of the signature of each person authorised by the resolutions referred to in paragraphs 3 and, if applicable, 5 above.

 

119

 

9.                                    A copy of the latest annual statutory audited accounts of the Additional Guarantor.

 

10.                            A legal opinion of Allen & Overy, legal advisers to the Agent, and, if applicable, other lawyers approved by the Agent in the place of incorporation of the Additional Guarantor addressed to the Finance Parties.

 

11.                            A certificate of an authorised signatory of the Additional Guarantor certifying that each copy document specified in this Part 2 of Schedule 2 is correct, complete and in full force and effect as at a date no earlier than the date of the Guarantor Accession Agreement.

 

120

 

PART 3

 

TO BE DELIVERED BY AN ADDITIONAL BORROWER

 

1.                                    A Borrower Accession Agreement, duly executed (if appropriate, under seal) by the Additional Borrower.

 

2.                                    A copy of the memorandum and articles of association and certificate of incorporation (or other equivalent constitutional documents) of the Additional Borrower.

 

3.                                    A copy of a resolution of the board of directors of the Additional Borrower:

 

(a)                               approving the terms of, and the transactions contemplated by, the Borrower Accession Agreement and resolving that it execute the Borrower Accession Agreement;

 

(b)                              authorising a specified person or persons to execute the Borrower Accession Agreement; and

 

(c)                               authorising a specified person or persons, on its behalf, to sign and/or despatch all documents to be signed and/or despatched by it under or in connection with this Agreement.

 

4.                                    A certificate of a director of the Additional Borrower certifying that the borrowing of the Total Commitments in full and the borrowing of the Total Commitments under (and as defined in) the 2019 Facility in full would not together cause any borrowing limit or limit on the giving of guarantees binding on it to be exceeded (whether as a result of such limit being waived or otherwise).

 

5.                                    A copy of any other authorisation or other document, opinion or assurance which the Agent considers to be necessary or desirable in connection with the entry into and performance of, and the transactions contemplated by, the Borrower Accession Agreement or for the validity and enforceability of any Finance Document.

 

6.                                    A specimen of the signature of each person authorised by the resolutions referred to in paragraph 3 above.

 

7.                                    A copy of the latest annual statutory audited accounts of the Additional Borrower (if any).

 

8.                                    A legal opinion of Allen & Overy, legal advisers to the Agent, and, if applicable, other lawyers approved by the Agent in the place of incorporation of the Additional Borrower addressed to the Finance Parties.

 

9.                                    A certificate of an authorised signatory of the Additional Borrower certifying that each copy document specified in this Part 3 of Schedule 2 is correct, complete and in full force and effect as at a date no earlier than the date of the Borrower Accession Agreement.

 

121

 

SCHEDULE 3

 

FORM OF REQUEST

 

To:                           THE ROYAL BANK OF SCOTLAND PLC as [Agent/U.S. Swingline Agent*]

 

From:           [BORROWER]

 

Date:   [       ]

 

Vodafone Group Plc U.S.$[      ]

Revolving Credit Agreement dated [·] 2015

 

1.                                    We wish to utilise the Revolving Credit Facility* and/or the Swingline Facility* by way of Advances*/Swingline Advances* as follows:

 

	
(a)
    	
Drawdown Date:
    	
Revolving
    
	
 
    	
Credit Facility:
    	
[           ]*
    
	
 
    	
Swingline   Facility:
    	
[         ]*
    
	
 
    	
 
    	
 
    
	
(b)
    	
Requested Amount   (including currency):
    	
Revolving
    
	
 
    	
Credit Facility:
    	
[            ]*
    
	
 
    	
Swingline   Facility:
    	
[            ]*
    
	
 
    	
 
    	
 
    
	
(c)
    	
Term:
    	
Revolving
    
	
 
    	
Credit Facility:
    	
[            ]*
    
	
 
    	
Swingline   Facility:
    	
[            ]*
    
	
 
    	
 
    	
 
    
	
(d)
    	
Payment   Instructions:
    	
Revolving
    
	
 
    	
Credit Facility:
    	
[            ]*
    
	
 
    	
Swingline   Facility:
    	
[            ]*
    

 

2.                                    We confirm that each condition specified in [Clause 4.2 (Conditions to all drawdowns and rollovers)]** is satisfied on the date of this Request and this Advance would not cause any borrowing limit binding on us to be exceeded.

 

 

 

[By:

[BORROWER]

Authorised Signatory]

 

 

 

**                                        Delete as applicable depending on whether the Advance is a Rollover Advance.

 

122

 

SCHEDULE 4

 

FORMS OF ACCESSION DOCUMENTS

 

PART 1

 

NOVATION CERTIFICATE

 

	
To:
    	
THE ROYAL BANK   OF SCOTLAND PLC as Agent
    
	
 
    	
 
    
	
From:
    	
[THE EXISTING   LENDER] and [THE NEW LENDER]
    	
Date: [     ]
    

 

 

Vodafone Group Plc U.S.$[         ]

Revolving Credit Agreement dated [·] 2015

 

We refer to Clause 27.4 (Procedure for novations).

 

1.                                    We [        ] (the “Existing Lender”) and [        ] (the “New Lender”) agree to the Existing Lender and the New Lender novating all the Existing Lender’s rights and obligations referred to in the Schedule in accordance with Clause 27.4 (Procedure for novations).

 

2.                                    The specified date for the purposes of [Clause 27.4(c) (Procedure for novations)] is [date of novation].

 

3.                                    The Facility Office and address for notices of the New Lender for the purposes of Clause 33.2 (Addresses for notices) are set out in the Schedule.

 

4.                                    The New Lender confirms that it has given notice to Vodafone of the entry into of this Novation Certificate [and has obtained Vodafone’s consent]* in accordance with Clause 27.2(c)(ii) (Transfers by Lenders).

 

5.                                    This Novation Certificate and any non-contractual obligations arising out of or in connection with it are governed by English law.

 

 

 

*                                            Delete as applicable depending on whether Vodafone’s consent is required.

 

123

 

THE SCHEDULE

 

Rights and obligations to be novated

 

[Details of the rights and obligations of the Existing Lender to be novated.]

 

 

	
[New Lender]
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
[Facility Office
    	
Address for notices]
    	
 
    
	
 
    	
 
    	
 
    
	
[Existing Lender]
    	
[New Lender]
    	
THE ROYAL BANK OF
    
	
 
    	
 
    	
SCOTLAND PLC
    
	
 
    	
 
    	
 
    
	
By:
    	
By:
    	
By:
    
	
 
    	
 
    	
 
    
	
Date:
    	
Date:
    	
Date:
    

 

124

 

PART 2

 

GUARANTOR ACCESSION AGREEMENT

 

To:                           THE ROYAL BANK OF SCOTLAND PLC as Agent

 

From:           [PROPOSED GUARANTOR]

 

Date: [       ]

 

Vodafone Group Plc U.S.$[     ] Revolving Credit Agreement

dated [·] 2015 (the “Credit Agreement”)

 

Terms used in this Deed which are defined in the Credit Agreement shall have the same meaning in this Deed as in the Credit Agreement.

 

We refer to Clause 27.7 (Additional Guarantors).

 

We, [name of company] of [Registered Office] (Registered no. [                              ]) agree to become an Additional Guarantor and to be bound by the terms of the Credit Agreement as an Additional Guarantor in accordance with Clause 27.7 (Additional Guarantors). [In addition, we also agree to become bound by all the terms of the Credit Agreement expressed to apply to or be binding on NewTopco]*

 

Our address for notices for the purposes of Clause 33.2 (Addresses for notices) is:

 

[

 

]

 

[If not classified as a corporation:  [Name of company] is [classified as a partnership/OR/disregarded as an entity separate from its owner] and is owned by [NAME OF OWNER(S)] for U.S. federal income tax purposes.]

 

This Deed and any non-contractual obligations arising out of or in connection with it are governed by English law.

 

 

	
Executed as a   deed by
    	
)
    	
Director
    
	
[PROPOSED   GUARANTOR]
    	
)
    	
 
    
	
acting by
    	
)
    	
Director/Secretary
    
	
And
    	
)
    	
 
    

 

 

 

*                                            Only in the case of accession by NewTopco.

 

125

 

PART 3

 

BORROWER ACCESSION AGREEMENT

 

To:                           THE ROYAL BANK OF SCOTLAND PLC as Agent

 

From:           [PROPOSED BORROWER]

 

[Date]

 

Vodafone Group Plc –U.S.$[      ] Revolving Credit Agreement

dated [·] 2015 (the “Credit Agreement”)

 

Terms used herein which are defined in the Credit Agreement shall have the same meaning herein as in the Credit Agreement.

 

We refer to Clause 27.8 (Additional Borrowers).

 

We, [Name of company] of [Registered Office] (Registered no. [         ] agree to become party to and to be bound by the terms of the Credit Agreement as an Additional Borrower in accordance with Clause 27.8 (Additional Borrowers).

 

The address for notices of the Additional Borrower for the purposes of Clause 33.2 (Addresses for notices) is:

 

[

 

]

 

[If not classified as a corporation:  [Name of company] is [classified as a partnership/OR/disregarded as an entity separate from its owner] and is owned by [NAME OF OWNER(S)] for U.S. federal income tax purposes.]

 

This Agreement and any non-contractual obligations arising out of or in connection with it are governed by English law.

 

[ADDITIONAL BORROWER]

 

By:

 

THE ROYAL BANK OF SCOTLAND PLC

By:

 

126

 

PART 4

 

LENDER ACCESSION AGREEMENT

 

To:                           THE ROYAL BANK OF SCOTLAND PLC as Agent

 

From:           [PROPOSED ADDITIONAL LENDER]

[Date]

 

Vodafone Group Plc –U.S.$[      ] Revolving Credit Agreement

dated [·] 2015 (the “Credit Agreement”)

 

Terms used herein which are defined in the Credit Agreement shall have the same meaning herein as in the Credit Agreement.

 

We refer to Clause 2.8 (Additional Lenders).

 

We, [Name of Additional Lender] agree to become party to and to be bound by the terms of the Credit Agreement as an Additional Lender in accordance with Clause 2.8 (Additional Lenders) with effect on and from [insert date].

 

Our Revolving Credit Commitment is U.S.$ [        ].[Our Swingline Commitment is U.S.$ [        ]]1

 

We confirm to each Finance Party that we:

 

(a)                               have made our own independent investigation and assessment of the financial condition and affairs of each Obligor and its related entities in connection with its participation in the Credit Agreement and have not relied exclusively on any information provided to us by a Finance Party in connection with any Finance Document; and

 

(b)                              will continue to make our own independent appraisal of the creditworthiness of each Obligor and its related entities while any amount is or may be outstanding under the Credit Agreement or any Commitment is in force.

 

The Facility Office and address for notices of the Additional Lender for the purposes of Clause 33.2 (Addresses for notices) is:

 

[                                                                                                                                                                                                                                ]

 

This Agreement and any non-contractual obligations arising out of or in connection with it are governed by English law.

 

[ADDITIONAL LENDER]

 

By:

 

THE ROYAL BANK OF SCOTLAND PLC

By:

 

VODAFONE GROUP PLC

 

By:

 

1                                             Delete if not applicable.

 

127

 

SCHEDULE 5

 

FORM OF CONFIDENTIALITY UNDERTAKING FROM NEW LENDER

 

To:                           [Existing Lender];

Vodafone Group Plc;

 

 

 

Dear Sirs,

 

We refer to the U.S.$[        ] Revolving Credit Agreement dated [·] 2015 (the “Credit Agreement”) between, among others, Vodafone Group Plc and The Royal Bank of Scotland plc (as Agent).

 

This is a confidentiality undertaking referred to in Clause 28 (Disclosure of Information) of the Credit Agreement. A term defined in the Credit Agreement has the same meaning in this undertaking.

 

We are considering entering into contractual relations with [insert name of Lender] (the Existing Lender) and understand that it is a condition of our receiving information about Vodafone Group Plc and its related companies and any Finance Document and/or any information under or in connection with any Finance Document that we execute this undertaking.

 

1.                                    Confidentiality Undertaking

 

We undertake (a) to keep the Confidential Information confidential and not to disclose it to anyone except as provided for by paragraph 2 below and to ensure that the Confidential Information is protected with security measures and a degree of care that would apply to our own confidential information, (b) to use the Confidential Information only for the Permitted Purpose, (c) to use all reasonable endeavours to ensure that any person to whom we pass any Confidential Information (unless disclosed under paragraph 2(b) below) acknowledges and complies with the provisions of this letter as if that person were also a party to it and (d) not to make enquiries of any member of the Consolidated Group or any of their officers, directors, employees or professional advisers relating directly or indirectly to the Facilities, other than directly to the Group Treasurer of Vodafone.

 

2.                                    Permitted Disclosure

 

You agree that we may disclose Confidential Information:

 

(a)                               to members of the Purchaser Group and their officers, directors, employees and professional advisers to the extent necessary for the Permitted Purpose and to any auditors of members of the Purchaser Group;

 

(b)        where requested or required by any court of competent jurisdiction or any competent judicial, governmental, supervisory or regulatory body, (ii) where required by the rules of any stock exchange on which the shares or other securities of any member of the Purchaser Group are listed or (iii) where required by the laws or regulations of any country with jurisdiction over the affairs of any member of the Purchaser Group.

 

128

 

3.                                    Notification of Required or Unauthorised Disclosure

 

We agree (to the extent permitted by law) to inform you of the full circumstances of any disclosure under paragraph 2(b) above or upon becoming aware that Confidential Information has been disclosed in breach of this letter.

 

4.                                    Return of Copies

 

If you so request in writing, we shall return all Confidential Information supplied by you to us and destroy or permanently erase all copies of Confidential Information made by us and use all reasonable endeavours to ensure that anyone to whom we have supplied any Confidential Information destroys or permanently erases such Confidential Information and any copies made by them, in each case save to the extent that we or the recipients are required to retain any such Confidential Information by any applicable law, rule or regulation or by any competent judicial, governmental, supervisory or regulatory body or in accordance with internal policy, or where the Confidential Information has been disclosed under paragraph 2(b) above.

 

5.                                    Continuing Obligations

 

The obligations in this letter are continuing and, in particular, shall survive the termination of any discussions or negotiations between you and us. Notwithstanding the previous sentence, the obligations in this letter shall cease (a) if we become a party to the Facilities or (b) twelve months after we have returned all Confidential Information supplied to us by you and destroyed or permanently erased all copies of Confidential Information made by us (other than any such Confidential Information or copies which have been disclosed under paragraph 2 above (other than paragraph 2(a)) or which, pursuant to paragraph 4 above, are not required to be returned or destroyed provided that any such Confidential Information retained in accordance with paragraph 4 above shall remain confidential, subject to paragraph 2, for the period during which it is retained).

 

6.                                    Consequences of Breach, etc.

 

We acknowledge and agree that you or members of the Consolidated Group (each a Relevant Person) may be irreparably harmed by the breach of the terms hereof and damages may not be an adequate remedy; each Relevant Person may be granted an injunction or specific performance for any threatened or actual breach of the provisions of this letter by any member of the Purchaser Group.

 

7.                                    No Waiver; Amendments, etc.

 

This letter sets out the full extent of our obligations of confidentiality owed to you in relation to the information the subject of this letter. No failure or delay in exercising any right, power or privilege hereunder will operate as a waiver thereof nor will any single or partial exercise of any right, power or privilege preclude any further exercise thereof or the exercise of any other right, power or privileges hereunder. The terms of this letter and our obligations hereunder may only be amended or modified by written agreement between us.

 

8.                                    Inside Information

 

We acknowledge that some or all of the Confidential Information is or may be price-sensitive information and that the use of such information may be regulated or prohibited by applicable legislation relating to insider dealing and we undertake not to use any Confidential Information for any unlawful purpose.

 

129

 

9.                                    Nature of Undertakings

 

The undertakings given by us under this letter are given to you and (without implying any fiduciary obligations on your part) are also given for the benefit of each other member of the Consolidated Group.

 

10.                            Governing Law and Jurisdiction

 

This letter and any non-contractual obligations arising out of or in connection with it shall be governed by and construed in accordance with the laws of England and the parties submit to the non-exclusive jurisdiction of the English courts.

 

11.                            Third Party Rights

 

(a)                               Subject to paragraphs 6 to paragraph 9 above the terms of this letter may be enforced and relied upon only by you and us and the operation of the Contracts (Rights of Third Parties) Act 1999 is excluded.

 

(b)                              Notwithstanding any provisions of this letter, the parties of this letter do not require the consent of any Relevant Person to rescind or vary this letter at any time.

 

12.                            Definitions

 

In this letter:

 

“Confidential Information” means any information relating to Vodafone, the Consolidated Group and/or the Facilities provided to us by you or any of your Affiliates or advisers, in whatever form, and includes information given orally and any document, electronic file or any other way of representing or recording information which contains or is derived or copied from such information but excludes information that (a) is or becomes public knowledge other than as a direct or indirect result of any breach of this letter or (b) is known by us before the date the information is disclosed to us by you or any of your affiliates or advisers or is lawfully obtained by us thereafter, other than from a source which is connected with the Consolidated Group and which, in either case, as far as we are aware, has not been obtained in violation of, and is not otherwise subject to, any obligation of confidentiality;

 

“Permitted Purpose” means considering and evaluating whether to enter into the Facilities; and

 

“Purchaser Group” means us, each of our holding companies and subsidiaries and each subsidiary of each of our holding companies (as each such term is defined in the Companies Act 1985).

 

Yours faithfully

 

 

 

 

 

 

For and on behalf of

[New Lender]

 

130

 

SCHEDULE 6

 

FORM OF ADDITIONAL LENDER’S FEE LETTER

 

Vodafone Group Plc (“Vodafone”)

Vodafone House

The Connection

Newbury

Berkshire RG14 2FN

 

For the attention of [Director of Treasury]

 

[DATE]

 

Dear Sirs,

 

Fee Letter

 

You have asked us to participate in a U.S.$[      ] credit facility (the “Facility”) to provide support for the Consolidated Group’s continuing commercial paper programmes and for general corporate purposes of the Consolidated Group including, but not limited to, acquisitions.

 

Terms defined in the credit agreement dated [·] 2015 between (inter alia) Vodafone and the financial institutions listed therein (the “Credit Agreement”) have the same meaning in this letter unless otherwise defined in this letter or the context otherwise requires.

 

This letter sets out the terms upon which you have agreed to pay a fee in relation to our participation in the Facility.

 

1.                                    Fee

 

You will pay to us for our account a non-refundable up-front fee equal to [         ] per cent. flat calculated on our Revolving Credit Commitment as at the date on which we become an Additional Lender pursuant to Clause 2.8 (Additional Lenders) of the Credit Agreement and payable 5 Business Days after that date;

 

2.                                    Finance Document

 

This Fee Letter is a Finance Document.

 

3.                                    No Set-off

 

All payments to be made under this Fee Letter will be calculated and made without (and free and clear of any deduction for) set-off or counterclaim).

 

4.                                    Governing Law

 

This letter and any non-contractual obligations arising out of or in connection with it are governed by and construed in accordance with English law.

 

If you agree to the above please sign and return the enclosed copy of this letter.

 

131

 

This letter may be executed in any number of counterparts, and this has the same effect as if the signatures on the counterparts were on a single copy of this letter.

 

Yours faithfully,

 

 

 

 

[                 ]

 

For and on behalf of

[ADDITIONAL LENDER]

 

 

 

We agree to the terms set out above.

 

[                 ]

 

For and on behalf of

Vodafone Group Plc

 

[DATE]

 

132

 

SCHEDULE 7

 

FORM OF INCREASE CONFIRMATION

 

To:                           THE ROYAL BANK OF SCOTLAND PLC as Agent and Vodafone, for and on behalf of each Obligor

 

From:           [the Increase Lender] (the “Increase Lender”)

 

[DATE]

 

Vodafone Group Plc U.S.$[     ] Revolving Credit Agreement

dated [·] 2015 (the “Credit Agreement”)

 

1.            We refer to the Credit Agreement. This agreement (the “Agreement”) shall take effect as an Increase Confirmation for the purpose of the Credit Agreement. Terms defined in the Credit Agreement have the same meaning in this Agreement unless given a different meaning in this Agreement.

 

2.                                    We refer to Clause 2.3 (Increase) of the Credit Agreement.

 

3.                                    The Increase Lender agrees to assume and will assume all of the obligations corresponding to the Commitment specified in the Schedule (the “Relevant Commitment”) as if it was an Original Lender under the Credit Agreement.

 

4.                                    The proposed date on which the increase in relation to the Increase Lender and the Relevant Commitment is to take effect (the “Increase Date”) is [    ].

 

5.                                    On the Increase Date, the Increase Lender becomes party to the relevant Finance Documents as a Lender.

 

6.                                    The Facility Office and address, fax number and attention details for notices to the Increase Lender for the purposes of Clause 33.2 (Addresses for notices) are set out in the Schedule.

 

7.                                    The Increase Lender expressly acknowledges the limitations on the Lenders’ obligations referred to in paragraph (f) of Clause 2.3 (Increase).

 

8.                                    The Increase Lender confirms, for the benefit of the Agent and without liability to any Obligor, that it is:

 

(a)                               [a Qualifying Lender (other than a Treaty Lender);]

 

(b)                              [a Treaty Lender;]

 

(c)                               [not a Qualifying Lender].2

 

[9]                              This Agreement may be executed in any number of counterparts and this has the same effect as if the signatures on the counterparts were on a single copy of this Agreement.

 

[9/10]          This Agreement and any non-contractual obligations arising out of or in connection with it are governed by English Law.

 

[10/11]  This Agreement has been entered into on the date stated at the beginning of this Agreement.

 

 

2                                            Delete as applicable — each Increase Lender is required to confirm which of these three categories it falls within.

 

133

 

THE SCHEDULE

 

Relevant Commitment/rights and obligations to be assumed by the Increase Lender

 

[insert relevant details]

 

[Facility office address, fax number and attention details for notices and account details for payments]

 

 

 

[Increase Lender]

 

By:

 

This Agreement is accepted as an Increase Confirmation for the purpose of the Credit Agreement by the Agent and the Increase Date is confirmed as [   ].

 

Agent

 

By:

 

134

 

SIGNATORIES

 

 

Borrower and Guarantor

 

VODAFONE GROUP PLC

 

 

 

Mandated Lead Arrangers

 

ABBEY NATIONAL TREASURY SERVICES PLC (TRADING AS SANTANDER GLOBAL BANKING AND MARKETS)

 

 

 

BANCO BILBAO VIZCAYA ARGENTARIA, S.A.

 

 

 

BANK OF AMERICA MERRILL LYNCH INTERNATIONAL LIMITED

 

 

 

BANK OF CHINA LIMITED, LONDON BRANCH

 

 

 

BARCLAYS BANK PLC

 

 

 

BNP PARIBAS, LONDON BRANCH

 

 

 

CITIBANK N.A., LONDON BRANCH

 

 

 

COMMERZBANK AKTIENGESELLSCHAFT, LONDON BRANCH

 

 

 

DEUTSCHE BANK LUXEMBOURG S.A.

 

 

 

GOLDMAN SACHS BANK USA

 

 

 

	
HSBC BANK PLC
    	
 
    

 

 

 

ING BANK N.V., LONDON BRANCH

 

 

 

INTESA SANPAOLO S.P.A.

 

 

 

J.P. MORGAN LIMITED

 

 

 

LLOYDS BANK PLC

 

 

 

	
MlZUHO BANK, LTD
    	
 
    

 

 

 

	
MORGAN STANLEY BANK INTERNATIONAL   LIMITED
    

 

 

 

	
SUMITOMO   MITSUI BANKING CORPORATION
    	
 
    

 

 

 

	
THE BANK OF TOKYO-MITSUBISHI   UFJ, LTD.
    

 

 

 

	
THE ROYAL BANK OF SCOTLAND PLC
    

 

 

 

	
UBS LIMITED
    

 

 

 

	
UNICREDIT   BANK AG
    	
 
    

 

 

 

	
Co-Arrangers
    
	
 
    
	
AUSTRALIA   AND NEW ZEALAND BANKING GROUP LIMITED
    

 

 

 

	
BANCO   DE SABADELL S.A., LONDON BRANCH
    

 

 

 

	
NATIONAL   AUSTRALIA BANK LIMITED ABN 12 004 044 937
    

 

 

 

	
SOCIETE GENERALE, LONDON BRANCH
    

 

 

 

	
STANDARD CHARTERED BANK
    

 

 

 

	
THE   BANK OF NEW YORK MELLON
    	
 
    

 

 

 

	
THE   TORONTO-DOMINION BANK
    	
 
    

 

 

 

Original Lenders

 

ABBEY NATIONAL TREASURY SERVICES PLC (TRADING AS SANTANDER GLOBAL BANKING AND MARKETS)

 

 

 

AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED

 

	
By:
    	

    	
 
    

 

 

BANCO BILBAO VIZCAYA ARGENTARIA, S.A., LONDON BRANCH

 

 

 

BANCO DE SABADELL S.A., LONDON BRANCH

 

 

 

BANK OF AMERICA MERRILL LYNCH INTERNATIONAL LIMITED

 

 

 

BANK OF AMERICA N.A.

 

 

 

	
BANK   OF CHINA LIMITED, LONDON BRANCH
    	
 
    

 

 

 

	
BARCLAYS BANK PLC
    	
 
    

 

 

 

	
BNP   PARIBAS, LONDON BRANCH
    	
 
    

 

 

 

	
CITIBANK, N.A., LONDON BRANCH
    

 

 

 

	
COMMERZBANK AKTIENGESELLSCHAFT,   LONDON BRANCH
    

 

 

 

DEUTSCHE BANK LUXEMBOURG S.A.

 

 

 

GOLDMAN SACHS BANK USA

 

 

 

HSBC BANK PLC

 

 

 

ING BANK N.V., LONDON BRANCH

 

 

 

INTESA SANPAOLO S.P.A.

 

 

 

JPMORGAN CHASE BANK, N.A., LONDON BRANCH

 

 

 

LLOYDS BANK PLC

 

 

 

MIZUHO BANK, LTD

 

 

 

MORGAN STANLEY SENIOR FUNDING, INC

 

 

 

NATIONAL AUSTRALIA BANK LIMITED ABN 12 004 044 937

 

 

 

SOCIETE GENERALE, LONDON BRANCH

 

 

 

STANDARD CHARTERED BANK

 

 

 

SUMITOMO MITSUI BANKING CORPORATION

 

 

 

TD BANK EUROPE LIMITED

 

 

 

THE BANK OF NEW YORK MELLON

 

 

 

THE BANK OF TOKYO-MITSUBISHI UFJ, LTD.

 

 

 

THE ROYAL BANK OF SCOTLAND PLC

 

 

 

UBS AG, LONDON BRANCH

 

 

 

UNICREDIT BANK AG

 

 

 

Swingline Lenders

 

ABBEY NATIONAL TREASURY SERVICES PLC (TRADING AS SANTANDER GLOBAL BANKING AND MARKETS)

 

 

 

BANCO BILBAO VIZCAYA ARGENTARIA, S.A., LONDON BRANCH

 

 

 

BANK OF AMERICA N.A.

 

 

 

BANK OF CHINA LIMITED, LONDON BRANCH

 

 

 

BARCLAYS BANK PLC

 

 

 

BNP PARIBAS

 

 

 

CITIBANK, N.A.

 

 

 

COMMERZBANK AKTIENGESELLSCHAFT, NEW YORK BRANCH

 

 

 

DEUTSCHE BANK LUXEMBOURG S.A. C/O DEUTSCHE BANK AG NEW YORK BRANCH

 

 

 

GOLDMAN SACHS BANK USA

 

 

 

HSBC BANK PLC

 

 

 

ING BANK N.V., DUBLIN BRANCH

 

 

 

INTESA SANPAOLO S.P.A.

 

 

 

JPMORGAN CHASE BANK, N.A., NEW YORK BRANCH

 

 

 

LLOYDS BANK PLC

 

 

 

MIZUHO BANK, LTD

 

 

 

MORGAN STANLEY SENIOR FUNDING, INC

 

 

 

SUMITOMO MITSUI BANKING CORPORATION

 

 

 

THE BANK OF TOKYO-MITSUBISHI UFJ, LTD.

 

 

 

THE ROYAL BANK OF SCOTLAND PLC

 

 

 

UBS AG, STAMFORD BRANCH

 

 

 

UNICREDIT BANK AG

 

 

 

Agent

 

THE ROYAL BANK OF SCOTLAND PLC

 

 

 

U.S. Swingline Agent

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