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Exhibit 4.2    
    

APPENDIX 1  

 RULES AND REGULATIONS

FOR THE AVENTIS STOCK

OPTION

PLAN 2003  

 Grant of December 2, 2003  

I.     GENERAL PRINCIPLES AND PURPOSE FOR AVENTIS STOCK OPTION PLAN  

        A stock option plan is a system that enables its beneficiaries to subscribe for new shares in their company (or in the parent company of their group) during a
certain period, at a price fixed at the opening of the plan and that remains fixed during the whole of this period. 

        The
purpose of Aventis stock option plan 2003 is to foster and promote the long-term success of Aventis Group and increase shareholder value by motivating superior
performance by means of performance-related incentives and by encouraging and providing for the acquisition of an ownership interest in Aventis Group by employees. The people concerned can therefore
choose to be fully associated to the running of their company and benefit from capital gains if the share price progresses favourably. 

        Stock
option plans of Aventis are governed by the French law and notably by Articles L 225-177 to L 225-185 of the Commercial Law concerning business
corporations. 

        On
the basis of the authorization and the powers which have been given to it by the Company's shareholders meeting, the Aventis Management Board has decided on the creation of the
present Aventis stock option plan 2003 and has laid down the conditions within the framework of the legal provisions mentioned above. The Management Board can adapt these conditions, notably in the
case of changes in the regulations relative to the stock options. 

II.    DEFINITIONS  

        Whenever used herein, the following terms shall have the respective meanings set forth below: 

        "Aventis"
means Aventis or the Company, as French holding company for an international group in the global life sciences industry. 

        "Aventis
Group" means the Company together with any company, partnership or other group of economic interest or legal entity where at least 10% of the capital or voting rights is held
directly or indirectly by the Company, on the date of exercise. 

        "Beneficiary"
means any Employee of the Aventis Group designated by the Management Board to receive options. 

        "Change
in control," means exclusively the occurrence of any of the following events: 

	(a)
	carrying
out a takeover bid or a public offer of exchange.

	(b)
	the
direct or indirect acquisition of an interest allowing a new shareholder to hold at least 20% of the voting rights in the shareholders' meeting, or to increase his/her previous
interest so as to hold at least 20% of the voting rights in the shareholders' meeting.

	(c)
	the
demerger, the contribution or transferral of significant corporate assets of the Company, which necessitate a shareholders' meeting of the Company. 

9

 

	(d)
	the
direct or indirect intervention of a rival company in the management of the Company.

	(e)
	the
merger-absorption by the Company of a rival company involving the arrival of shareholders holding over 20% of the voting rights of the company resulting from the merger, and the
merger-absorption of the Company by a rival company involving the arrival of new shareholders holding over 20% of the voting rights of the company resulting from the merger. 

        "Company"
means Aventis, a French company, and any successor thereto. 

        "Employee"
means any employee of the Company or of Aventis Group. 

        "Management
Board" means the Management Board of directors of Aventis. 

        "Option"
means the right to subscribe share(s) at a stated price for a specified period of time. 

        "Period
of restriction" means the period during which the Management Board can suspend the right for employees to exercise the options. 

        "Share"
means the common share of the Company, par value € 3.82 per share. 

        "Stock
Option Plan" means the Aventis stock option plan 2003. 

        Gender and Number:    Except when otherwise indicated by the context, words in the masculine gender used in the Stock Option
Plan shall include the feminine gender, the singular shall include the plural, and the plural shall include the singular. 

III.  DESCRIPTION OF THE AVENTIS STOCK OPTION PLAN  

Optionees  

        The Management Board has laid down the list of beneficiaries of the Stock Option Plan. 

Number of shares  

        The maximum number of shares each beneficiary may apply for is given on the individual letter addressed by the Chairman, or his duly designated representative. 

Share subscription price  

        The Management Board has set the subscription price on the basis of the average price (on the basis of the closing prices) quoted during
the last twenty days trading on the Paris stock exchange prior to the Management Board decision in accordance with the legal and statutory provisions in force.

        It
will remain fixed during the entire Stock Option Plan subject to its adjustment by the Management Board according to the terms and conditions set out in these regulations. 

Duration of the options  

        The options are granted irrevocably for a duration of 10 years from the day they are allotted by the Management Board. 

        Options
that have not been exercised at the end of the 10-year period will be declared null and void. No extensions will be granted. 

10

 

        The
options will not be exercisable within the first three years. However, the beneficiaries deemed to be resident in France for tax purposes will be entitled to exercise their options
only after a four-year period from the date of the grant, unless they keep the shares on the asset register until the end of the said four-year period, and except if this
exercising before four years no longer leads to the payment of social security contributions by the Company on the capital gains made by the beneficiaries following a change in the French regulations
in force. 

        The
rights resulting from the options granted are non-transferable. 

Adjusting the subscription price and the number of shares  

        Should the Company carry out any of the following financial operations before the options have expired, the subscription price of the shares and the number of
shares that can be subscribed for by each beneficiary will be adjusted by the Management Board under the following conditions: 

	1.
	In
the case of the issue, reserved for the shareholders, of shares to be subscribed in cash, or convertible or exchangeable bonds or bond warrants, the subscription price of the shares
under option will be reduced by an amount equal to the product of this price through the ratio between the value of the subscription right and the value of the share before removal of this right. 

        The
ratio will be calculated as follows: 

	•
	The
value of the share before removal of the subscription right will be equal to the average of twenty consecutive opening prices chosen from the forty trading days
preceding the opening day of the issue.

	•
	The
value of the subscription right will be the theoretical value calculated according to the number of new shares issued to which an existing share gives entitlement, the
issue price of these new shares and the value of the share before removal of the subscription right.

	2.
	In
the case of an increase in capital through incorporation of reserves, profit or premiums and distribution of bonus shares, the subscription price of the shares under option will be
adjusted by the application of a coefficient equal to the ratio between the number of old shares and the number of shares existing after the operation.

	3.
	In
the case of distribution of reserves into cash or into portfolio securities, the subscription price of the shares under option will be reduced by an amount equal to the product of
this price multiplied by the ratio between the amount per share of the distribution and the value of the share before distribution. 

        For
the calculation of this ratio, if the Company shares and the securities distributed are allowed in transactions on a regulated market, the value of the securities distributed and the
value of the share before distribution will be equal to the average of the first prices quoted during the thirty trading days of the stock exchange prior to the start of the distribution. 

        If
the shares of the Company or the securities distributed are not allowed in transactions on a regulated market, the Management Board will fix the values upon review of the auditors'
special report. 

	4.
	In
the case of a reduction of capital due to losses.

	•
	If
the reduction focuses on the number of shares, the subscription price will be adjusted by appropriating to it a coefficient equal to the ratio between the number of old
shares and the number of shares remaining after reduction.

	•
	If
the reduction focuses on the nominal value of the shares, there will be no adjustment. 

11

 

        In
all the cases mentioned above, an adjustment in the number of shares under option will be made so that the total subscription prices remain constant. The number adjusted will however
be rounded up to the higher figure. 

Change of Control  

        The 'Change of Control' will be considered as 'effective' from: 

	(a)
	the
date of publication in the official list of the notice of the result of the takeover bid by Euronext Paris, in the case of a takeover bid or a public offer of exchange.

	(b)
	the
date of the notification to the Company of the crossing of the threshold level having taken the interest of a shareholder to at least 20% of the voting rights in the Company, in
the case of entry into the capital of a new shareholder holding at least 20% of the voting rights in the shareholders' meeting or the increase in the previous interest of a new shareholder taking
his/her interest to at least 20% of the voting rights in the shareholders' meeting.

	(c)
	the
date of the general meeting approving the demerger, transferral or contribution of the principal assets of the Company or the merger, in the case of demerger, contribution or
transfer of the principal assets of the Company or merger.

	(d)
	the
date of the general meeting appointing the new management and administration structure, in the case of the direct or indirect intervention of a rival company in the management and
administration structure of the Company. 

        In
the case of 'Change of Control': 

	1.
	The
Company will do its best to ensure sufficient liquidity allowing the options to be exercised under normal conditions.

	2.
	If
the Aventis shares ceased to be quoted on a regulated market, it would be requested of the company responsible for the 'Change of Control' to take over the existing patrimonial
commitments with regard to the beneficiaries and as a consequence to implement one of the following solutions:

	•
	either
to undertake to buy back from the beneficiaries the shares obtained following the exercise of their options, on the date when they will present them, this date
obligatorily being during the exercise period initially decided for the options. In the case where the Company is subject to a procedure of obligatory withdrawal, the shares obtained by the
beneficiaries must obligatorily be presented for repurchase following the exercise of the options. 

The
price of the repurchase will be equal to that of the Aventis share on the date when the Change of Control becomes effective or on the first date of quotation following this date, and would vary
both upwards and downwards between this date and the date of the request for repurchase, according to the evolution of the price of the share of the Company which is the beneficiary of the 'Change of
Control' over the same period. 

	•
	or
to grant the beneficiaries, in exchange for their old options, new options. 

If
these commitments are not carried out, the resulting loss to the beneficiaries will be estimated by an expert designated by the two parties, or if no agreement can be found, by the President of the
Paris Tribunal de Commerce (commercial court), who will give a ruling on the petition of the more diligent party. 

The
amount decided would be paid by the Company, or by any company that it will substitute for or that will substitute for it. 

12

 

To
decide this loss, the expert will take into account the price of the share on the date when the Change of Control becomes effective or on the first date of quotation following this change and the
'time value' still left to run until the final date for the exercise of the considered options taking into account all the existing corporate or tax incidences. 

IV.    EXERCISE OF THE OPTIONS  

Exercising conditions  

        The exercise of the options by an optionee is subject to the condition that he/she is actively employed by, or has a corporate mandate with, the Company or one of
the Companies of the Aventis Group on the date of the exercise, unless otherwise decided by the Management Board in exceptional cases. 

        By
Company of the Aventis Group, it is meant any company or group of economic interests where at least 10% of the capital or voting rights is held directly or indirectly by the Company,
on the date of exercise. 

        Notwithstanding
the provisions of the preceding paragraphs: 

	•
	In
the case of (i) resignation, (ii) lay-off, redundancy or other termination at the employer's initiative (except for serious professional
misconduct), (iii) expiration of a limited duration work contract or (iv) revocation of a corporate mandate (except for serious professional misconduct), the options can, whatever the
case, be exercised for a maximum period of 6 months from the date of departure from the employing company (in the case of resignation or termination), the date of expiration of the work
contract or the date of the revocation, subject to their being exercisable on such date of departure, expiration or revocation. Options that are not exercisable on such date of departure, expiration
or revocation will be lost.

	•
	If
the prior formal approval of the Management Board is obtained, in the case of lay-off, redundancy or other termination at the employer's initiative resulting
from a collective headcount reduction scheme (except in the case of serious professional misconduct), the options can be exercised for a period of 12 months from the effective date of the
termination or from the Opening Day of the Exercise Period of the options if this date is later, provided that this period cannot exceed the termination date of the options. Opening Day of the
Exercise Period means it is the day from which the options are exercisable as stipulated in the paragraph "Duration of the options".

	•
	However,
if a lay-off, redundancy or other termination at the employer's initiative (except for serious professional misconduct), expiration of a work contract
or revocation (except for serious professional misconduct) takes place within eighteen months following a Change of Control of the Company, the options can be exercised until the expiration of the
plan under the same conditions as if the optionee were still employed or held a corporate mandate.

	•
	In
the case of dismissal or revocation for serious professional misconduct, the departure from the employing company automatically cancels those options not yet exercised
with effect from the date of notification of such dismissal or revocation.

	•
	In
the case of the transfer of a Company of the Aventis Group or an activity of a Company of the Aventis Group to a company where Aventis does not hold directly or
indirectly at least 10% of the capital or voting rights, or in the case of transfer by flotation, the options can be exercised until the expiration of the plan under the same conditions as if the
optionee were still employed or held a corporate mandate. 

13

 

	•
	In
the case of the death of the optionee, the heirs who wish to exercise the options must do so under the conditions fixed by French law, which at the moment stipulate that
the options are exercisable for a period of six months from the date of death.

	•
	Except
in the case of serious professional misconduct, the options can be exercised until the expiration of the plan under the same conditions as if the optionee were still
employed or held a corporate mandate, in the following cases:

	•
	Disability,

	•
	Employee
or holder of a corporate mandate, aged 55 or more, retiring at the employer's initiative or taking early retirement at the employer's initiative,

	•
	Employee
or holder of a corporate mandate, aged 55 or more and having at least 10 years of seniority in the Aventis Group, retiring,

	•
	Lay-off,
redundancy or other termination at the employer's initiative (except for serious professional misconduct) of an employee aged 55 or more,

	•
	Revocation
or early termination of the corporate mandate (except for serious professional misconduct) of a mandate holder aged 55 or more. 

Period of restriction  

        The Management Board can suspend the right to exercise the options if necessary, notably when trading on Aventis capital requires the exact and prior knowledge of
the number of shares that make up the capital or in the case of one of the financial operations leading to an adjustment being carried out. 

        In
these cases, the Company will inform the beneficiaries of the suspension date and the date when the options can be exercised again. Such a suspension cannot extend the exercise period
beyond the original 10-year period. 

        In
order to reduce the risk of unintentional insider trading, the Management Board can also suspend the right to exercise the options temporarily during identified "Black-Out
Periods", which are periods of time when significant confidential information is circulating within the company. This includes the approximately 30-day period between the end of each
fiscal year or quarter and the public announcement of earnings for that year or quarter. During a "Black-Out period", employees who are considered likely to be aware of such confidential
information are blocked from exercising stock options until the "black-out period" expires. 

Methods of the exercise of the options  

        The exercise of the options is at the discretion of the beneficiaries. 

        The
options can be exercised partially or in totality. 

        To
exercise an option, the beneficiaries must apply to the Plan Manager whose details will have been provided. 

        Costs
incurred in exercising an option by the Plan Manager will be born by the beneficiaries. 

V.     CHARACTERISTICS OF SUBSCRIBED SHARES  

Form and delivery of stocks  

        Shares subscribed for by beneficiaries who are French residents must take the registered form. If this is not the case, their holders will lose the benefit of the
special tax system for stock options. 

14

 

        Unless
instructions to the contrary are received from the beneficiaries, the stocks will be registered in an individual account opened in the Plan Manager's books. 

Interest  

        The new shares will be created with coupon attached and will be immediately entitled to the same dividend as the other shares which make up the capital of
Aventis, subject to having been subscribed during the fiscal year for which the first dividend will be paid to them. 

        Shares
subscribed between the first day of the fiscal year and the date of distribution of the dividend in that year in respect of the previous fiscal year will not give entitlement to
the dividend relating to this previous fiscal year and will be subject to a specific quotation on the market of the Paris Bourse until the date of distribution of the said dividend. 

VI.   TRANSFER OF SHARES  

        Subject to the period inherent in preliminary formalities for the quotation on the stock market of new shares and possibly the application of a tax system which
is less favourable in the case of non-compliance with legal conditions concerning time of tenure and form, the shares acquired following the exercise of options can be sold immediately. 

        To
carry out this sale, the beneficiaries must address a selling order to the Plan Manager, in accordance with the model sent by the latter. 

        Requests
to exercise options will be recorded on a register timed and dated, which will be held by each Plan Manager. 

VII MANAGEMENT OF THE PLAN  

        The administrative management of the Stock Option Plan has been entrusted to banks selected by Aventis (each one a 'Plan Manager'). The beneficiaries will be
informed of the details of the Plan Manager who they can contact for any information. 

        Aventis
reserves the right to entrust to a new bank the administrative management of the stock option plan, after prior information to the beneficiaries. 

VIII MISCELLANEOUS  

        As some beneficiaries are not French residents, the Management Board could, depending on the conditions imposed by certain countries, with regard to the exercise
of options and the subsequent transfer of options, modify certain provisions of the plan concerning beneficiaries working in these countries, without these modifications making the plan more
favourable for these beneficiaries (apart from aspects relating to the tax systems of these countries). 

        Nothing
in the Plan shall interfere or limit in any way the right of the employer to terminate any beneficiary's employment at any time, nor confer upon any beneficiary any right to
continue in employ of their company. No beneficiary shall have a right to be selected as a beneficiary, or, having been so selected, to receive any future options. 

        Securities offered to persons who are not residents or citizens of the United States of America have not been and will not be registered under the U.S. Securities
Act of 1933, as amended (the "Act") and may not be offered or sold in the United States unless registered under the Act or an exemption from registration is available.

15

 
RULES AND REGULATIONS FOR

AVENTIS STOCK SUBSCRIPTION OPTION  

 GRANT of December 2, 2003  

ANNEX  

	Authorization of the Option Plan	 	:	 	General Shareholders Meeting of May 14, 2002.
	

Decision and date of grant	
 	

:	
 	

Management Board of December 2, 2003
	

Number of options allotted	
 	

:	
 	

10 232 797
	

Reference price (average price quoted from November 4, 2003 to December 1, 2003)	
 	

:	
 	

€ 47.52
	

Exercise price	
 	

:	
 	

€ 47.52
	

Vesting date	
 	

:	
 	

December 3, 2006 except for French tax residents (December 3, 2007 for French tax residents)
	

Exercise period	
 	

:	
 	

From December 3, 2006 through December 2, 2013 inclusive (From December 3, 2007 through December 2, 2013, inclusive for French tax residents)

16

QuickLinks

Exhibit 4.2Exhibit
10.1

 

CONFORMED
COPY

 

 

CREDIT
AGREEMENT

 

 

 

DATED 16th
January, 2004

 

 

€1,072,000,000

 

SENIOR
SECURED CREDIT FACILITY

 

for

 

UPC
DISTRIBUTION HOLDING B.V.

as Borrower

 

with

 

TD BANK
EUROPE LIMITED

acting as
Facility Agent and Security Agent

 

 

 

London

 

 

CONTENTS

 

	
  Clause

  	
   

  
	
   

  	
   

  
	
  1.

  	
  Interpretation

  	
   

  
	
  2.

  	
  The Facilities

  	
   

  
	
  3.

  	
  Purpose

  	
   

  
	
  4.

  	
  Conditions
  Precedent

  	
   

  
	
  5.

  	
  Advances

  	
   

  
	
  6.

  	
  Repayment

  	
   

  
	
  7.

  	
  Cancellation and Prepayment

  	
   

  
	
  8.

  	
  Interest

  	
   

  
	
  9.

  	
  Payments

  	
   

  
	
  10.

  	
  Tax Gross-up and
  Indemnities

  	
   

  
	
  11.

  	
  Market Disruption

  	
   

  
	
  12.

  	
  Increased Costs

  	
   

  
	
  13.

  	
  Illegality and Mitigation

  	
   

  
	
  14.

  	
  Guarantee

  	
   

  
	
  15.

  	
  Representations and
  Warranties

  	
   

  
	
  16.

  	
  Undertakings

  	
   

  
	
  17.

  	
  Financial
  Covenants

  	
   

  
	
  18.

  	
  Default

  	
   

  
	
  19.

  	
  Facility Agent, Security Agent and Lenders

  	
   

  
	
  20.

  	
  Fees

  	
   

  
	
  21.

  	
  Expenses

  	
   

  
	
  22.

  	
  Stamp Duties

  	
   

  
	
  23.

  	
  Indemnities

  	
   

  
	
  24.

  	
  Evidence and Calculations

  	
   

  
	
  25.

  	
  Amendments
  and Waivers

  	
   

  
	
  26.

  	
  Changes
  to the Parties

  	
   

  
	
  27.

  	
  Disclosure of Information

  	
   

  
	
  28.

  	
  Set-off

  	
   

  
	
  29.

  	
  Pro Rata Sharing

  	
   

  
	
  30.

  	
  Severability

  	
   

  
	
  31.

  	
  Counterparts

  	
   

  
	
  32.

  	
  Notices

  	
   

  
	
  33.

  	
  Language

  	
   

  
	
  34.

  	
  Jurisdiction

  	
   

  
	
  35.

  	
  Waiver or Immunity

  	
   

  
	
  36.

  	
  Waiver
  of Trial by Jury

  	
   

  
	
  37.

  	
  Governing Law

  	
   

  
	
  20.

  	
  Governing Law and
  Jurisdiction

  	
   

  
	
   

  	
   

  	
   

  
	
  Schedule

  	
   

  
	
   

  	
   

  	
   

  
	
  1.

  	
  Original Parties

  	
   

  
	
   

  	
  Part 1

  	
  Original
  Guarantors

  	
   

  
	
   

  	
  Part 2

  	
  Initial
  Facility D Lenders and Commitments

  	
   

  
	
  2.

  	
  Conditions Precedent
  Documents

  	
   

  
	
   

  	
  Part 1

  	
  To be
  Delivered before the First Advance

  	
   

  
	
   

  	
  Part 2

  	
  To be
  Delivered by an Additional Obligor

  	
   

  
	
  3.

  	
  Mandatory
  Cost Formulae

  	
   

  

 

2

 

	
  4.

  	
  Form of Request
  and Cancellation Notice

  	
   

  
	
   

  	
  Part
  1

  	
  Form of Request

  	
   

  
	
   

  	
  Part 2

  	
  Form of
  Cancellation and/or Prepayment Notice

  	
   

  
	
  5.

  	
  Forms of Accession
  Documents

  	
   

  
	
   

  	
  Part 1

  	
  Novation
  Certificate

  	
   

  
	
   

  	
  Part 2

  	
  Sub-Participation Agreement

  	
   

  
	
   

  	
  Part 3

  	
  Obligor Accession Agreement

  	
   

  
	
   

  	
  Part 4

  	
  Additional
  Facility Accession Agreement

  	
   

  
	
   

  	
  Part 5

  	
  Additional
  Facility D Lender Accession Agreement

  	
   

  
	
   

  	
  Part 6

  	
  Form of Verification Letter

  	
   

  
	
  6.

  	
  Form of Confidentiality
  Undertaking

  	
   

  
	
   

  	
  Part 1

  	
  Form of LMA Confidentiality Undertaking

  	
   

  
	
   

  	
  Part 2

  	
  Form of LSTA Confidentiality Undertaking

  	
   

  
	
  7.

  	
  Security Documents

  	
   

  
	
  8.

  	
  Borrower
  Group Structure

  	
   

  
	
  9.

  	
  Shareholders’
  Agreements

  	
   

  
	
   

  	
   

  	
   

  
	
  Signatories

  	
   

  

 

3

 

 

THE AGREEMENT is dated 16th January,
2004 and made

 

BETWEEN:

 

(1)                                  UPC DISTRIBUTION HOLDING B.V. (UPC Distribution);

 

(2)                                  THE COMPANIES identified as guarantors in Part 1 of Schedule 1
(Original Guarantors) (the Original
Guarantors);

 

(3)                                  THE BANKS AND FINANCIAL INSTITUTIONS listed in Part 2 of
Schedule 1 (Initial Facility D Lenders and Commitments) as lenders (the Initial Facility D Lenders);

 

(4)                                  TD BANK EUROPE LIMITED as facility agent (the Facility Agent);

 

(5)                                  TD BANK EUROPE LIMITED as security agent for the Finance Parties (in
this capacity, the Security Agent);
and

 

(6)                                  TD BANK EUROPE  LIMITED and TORONTO-DOMINION (TEXAS) INC as facility
agents under the Existing Facility.

 

IT IS AGREED as follows:

 

1.                                      INTERPRETATION

 

1.1                               Definitions

 

In this Agreement:

 

Accounting Period in
relation to any person means any period of approximately three months or one
year for which accounts of such person are required to be delivered pursuant to
this Agreement.

 

Acquisition means the
acquisition, whether by one or a series of transactions, (including, without
limitation, by purchase, subscription or otherwise) of all or any part of the
share capital or equivalent of any company or other person (including, without
limitation, any partnership or joint venture) or any asset or assets of any
company or other person (including, without limitation, any partnership or
joint venture) constituting a business or separate line of business of that
company or other person.

 

Acquisition Business Plan means, in
respect of an Acquisition, a business plan for the Borrower Group (including
the Target to be acquired) which has been reviewed by Deloitte & Touche and
which sets out the management plan for the period from the date of the proposed
Acquisition (taking into account the Acquisition Cost of such Acquisition and
financial projections relating to the Target) up to and including the Final
Maturity Date and based on assumptions which are no more aggressive (when taken
as a whole) than those used in preparation of the Business Plan.

 

Acquisition Cost means, in
relation to an Acquisition, the value of the consideration for that Acquisition
at the time of completion of the Acquisition and for this purpose:

 

(a)                                  the value
at the time of completion of the Acquisition of any consideration to be paid or
delivered after the time of completion of the Acquisition will be determined in
accordance with GAAP (provided that, for the purposes only of sub-paragraph
(c)(i)

 

1

 

of the definition of
“Permitted Acquisition”, sub-paragraph (b)(i) of the definition of “Permitted
Joint Venture” and Clause 16.11(b)(ii) (Acquisitions and mergers) and the
definition of “Borrower Group Capitalisation” in Clause 17.1 (Financial
definitions), the value of any such deferred consideration shall only be
included in the calculation of the Acquisition Cost of an Acquisition at the
time such deferred consideration is paid or delivered);

 

(b)                                 if the
entity acquired becomes a member of the Borrower Group as a result of the
Acquisition, the aggregate principal amount of Financial Indebtedness of any
entity  acquired outstanding at the time
of completion of the Acquisition (including without limitation any Lending
Transaction (as defined in Clause 16.14(f) (Loans and guarantees) made by a
member of the Borrower Group in connection with the relevant Acquisition) will
be counted as part of the consideration for that Acquisition;

 

(c)                                  if the
entity acquired does not become a member of the Borrower Group as a result of
the Acquisition, the aggregate principal amount of Financial Indebtedness of
the entity acquired at the time of completion of the Acquisition will be
counted as part of the consideration for that Acquisition to the extent of the
aggregate principal amount of the payment and repayment obligations in respect
of such Financial Indebtedness assumed or guaranteed by any member of the
Borrower Group; and

 

(d)                                 subject to
paragraphs (a), (b) and (c) above, the value at the time of completion of the
Acquisition of any non-cash consideration will be determined in accordance with
GAAP,

 

expressed in euros, if required, using the
Agent’s Spot Rate of Exchange on the date of completion of the Acquisition.

 

Additional Acquisition means a
Majority Acquisition (as defined in paragraph (c) of the definition of
“Permitted Acquisition”) where the business of the acquired entity or the
business acquired, as the case may be:

 

(a)                                  is of the
same nature as the business of the Borrower Group as at the Effective Date; and

 

(b)                                 is being
carried on only in:

 

(i)                                     a
jurisdiction in which a member of the Borrower Group is incorporated and is
operating (including Poland if UPC Polska is a member of the Borrower Group on
the date of the Additional Acquisition); or

 

(ii)                                  Poland,
but only in the case of the UPC Polska Acquisition.

 

Additional Borrower means a
member of the Borrower Group which becomes an Additional Borrower in accordance
with Clause 26.4 (Additional Obligors).

 

Additional Facility means an
additional term loan facility referred to in Clause 2.2 (Additional Facilities)
and Additional Facilities means
all or any such Facilities.

 

Additional Facility Accession
Agreement means a deed in the form of Part 4 of
Schedule 5, with such amendments as the Facility Agent may approve or
reasonably require.

 

Additional Facility Advance means an
advance made to a Borrower under an Additional Facility.

 

2

 

Additional Facility
Availability Period in relation to an Additional Facility means
the period specified in the Additional Facility Accession Agreement for that
Additional Facility.

 

Additional Facility Commitment means in
relation to an Additional Facility and an Initial Additional Facility Lender:

 

(a)                                  the amount
in euros or US Dollars set out as the Additional Facility Commitment of an
Additional Facility Lender in the relevant Additional Facility Accession
Agreement and the amount of any other Additional Facility Commitment
transferred to it under this Agreement; and

 

(b)                                 any other
Additional Facility Lender, the amount in euros or US Dollars (as applicable)
transferred to it in accordance with this Agreement,

 

to the extent not cancelled, reduced or
transferred by it in accordance with this Agreement.

 

Additional Facility D Lender means any
person which has become a Facility D Lender in accordance with Clause 2.8(a)
(Additional Facility D Lenders).

 

Additional Facility D Lender
Accession Agreement means an accession agreement substantially in
the form of Part 5 of Schedule 5.

 

Additional Facility Lender means:

 

(a)                                  an Initial
Additional Facility Lender; and

 

(b)                                 any person
which has become a New Lender (as defined in Clause 26.2 (Transfers by Lenders)
under an Additional Facility in accordance with Clause 26 (Changes to the
Parties),

 

which in each case has not ceased to be a Party
in accordance with the terms of this Agreement.

 

Additional Guarantor means:

 

(a)                                  a Subsidiary
of UPC Distribution; and

 

(b)                                 any UPC
Distribution Holdco (other than UPC Holding),

 

which in each case becomes an Additional
Guarantor in accordance with Clause 26.4 (Additional Obligors).

 

Additional Obligor means an
Additional Borrower or an Additional Guarantor.

 

Additional Permitted
Acquisition means an Acquisition permitted under paragraph (d) of
the definition of “Permitted Acquisition”.

 

Additional Prepayment Cap has
been reached means an aggregate amount of at least €600,000,000 has
been applied by UPC Distribution in permanent prepayment and cancellation of
the Existing Facility and/or the Facilities under any of the following clauses:

 

(a)                                  clause
7.6A(a)(i) and (b)(i) (Mandatory prepayment from Third Party Debt proceeds) of
the Existing Facility Agreement;

 

3

 

(b)                                 Clause
7.6A(a) and (b) (Mandatory prepayment from Third Party Debt proceeds) of this
Agreement;

 

(c)                                  clause
7.5(c)(i) and (d)(i) (Mandatory prepayment from Excess Cash Flow and Net Equity
Proceeds) of the Existing Facility Agreement;

 

(d)                                 Clause
7.5(d)(i) and (d)(ii) (Mandatory prepayment from Excess Cash Flow and Net
Equity Proceeds) of this Agreement;

 

(e)                                  clause 7.3
(Voluntary prepayment) of the Existing Facility Agreement; and

 

(f)                                    Clause 7.3
(Voluntary prepayment) of this Agreement.

 

Advance means a
Facility D Advance or an Additional Facility Advance.

 

Affiliate means, in
respect of a person, a direct or indirect Subsidiary or Holding Company of that
person or any other person which is under common control with that person (and
for this purpose, control has the
meaning given to it in section 416 of the Income and Corporation Taxes Act
1988 in force as at the Signing Date).

 

Agent means the
Facility Agent or the Security Agent (or both), as the context requires.

 

Agent’s Spot Rate of Exchange means the
spot rate of exchange as determined by the Facility Agent for the purchase of
US Dollars (or any other relevant currency) in the London foreign exchange
market with euros at or about 11.00 a.m. on a particular day.

 

Allocation Date means the
date, falling five Business Days after the Signing Date on which the Facility
Agent allocates the Facility D Commitments in accordance with Clause 2.8
(Additional Facility D Lenders).

 

Annualised EBITDA has the
meaning given to it in Clause 17.1 (Financial definitions).

 

Anti-Terrorism Law means
each of:

 

(a)                                  Executive
Order No. 13224 of September 23, 2001 - Blocking Property and Prohibiting
Transactions With Persons Who Commit, Threaten to Commit, or Support Terrorism
(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);

 

(c)                                  the Money
Laundering Control Act of 1986, Public Law 99-570; and

 

(d)                                 any
similar law enacted in the United States of America subsequent to the date of
this Agreement.

 

Approved Stock Options means any
options, warrants, rights to purchase or other equivalents (however designated)
issued or granted by a member of the Borrower Group to any former, present or
future officers, consultants, directors and/or employees of any member of the
Borrower Group or its Associated Companies to subscribe for share capital or
similar rights of ownership in that member of the Borrower Group provided that
the maximum aggregate amount of such options, warrants, rights to purchase or
other equivalents (however designated) shall not exceed (i) 8 per cent. of its
issued share capital, in the case of Stipdon

 

4

 

and any Subsidiary of Stipdon (provided that
the aggregate amount of such options, warrants, rights to purchase or other
equivalents issued by Stipdon and its Subsidiaries does not exceed 8 per cent.
of the issued share capital of Stipdon) and (ii) 7.5 per cent. of its issued
share capital or similar rights of ownership, in the case of each other member
of the Borrower Group.

 

Approved Transaction means the
transactions announced by UPC and UGC on 26th June, 2000 and described in UPC’s
Current Report on Form 8-K as filed with the US Securities and Exchange
Commission on 11th July, 2000 or one or a series of related transactions
resulting in the completion of the transactions so described.  No such transaction has occurred as of 14th
January, 2004.

 

Associated Company of a
person means:

 

(a)                                  any other
person which is directly or indirectly Controlled by, under common Control with
or Controlling such person; or

 

(b)                                 any other
person owning beneficially and/or legally directly or indirectly 10 per cent.
or more of the equity interest in such person or 10 per cent. of whose equity
is owned beneficially and/or legally directly or indirectly by such person.

 

Auditors means
KPMG or such other leading firm of independent and internationally recognised
accountants appointed by UPC Distribution as its auditors for the purposes of
preparing the audited consolidated accounts of UPC Distribution.

 

Belmarken means
Belmarken Holding B.V., a private limited liability company incorporated under
the laws of The Netherlands and, as of the Signing Date, with its registered
office at Amsterdam and its business office at Boeing Avenue 53, 1119 PE
Schiphol Rijk, Amsterdam, The Netherlands.

 

Beneficiaries has the
meaning given to it in the Security Deed.

 

Borrower means UPC
Distribution and any Additional Borrower.

 

Borrower Group means:

 

(a)                                  UPC
Distribution and its Subsidiaries from time to time excluding Unrestricted
Subsidiaries; and

 

(b)                                 UPC
Financing.

 

Break Costs means the
amount (if any) by which:

 

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

 

exceeds:

 

(b)                                 the amount
of interest which that Lender would be able to obtain by placing an amount
equal to the principal amount or Unpaid Sum received by it on deposit with a
leading bank in the London interbank market for a period starting on the
Business

 

5

 

Day following receipt or
recovery and ending on the last day of the current Interest Period.

 

Business means any
business of the Borrower Group:

 

(a)                                  that
consists of the upgrade, construction, creation, development, marketing,
acquisition (to the extent permitted under this Agreement), operation,
utilisation and maintenance of networks that use existing or future technology
for the transmission, reception and delivery of voice, video and/or other data
(including networks that transmit, receive and/or deliver services such as
multi-channel television and radio, programming, telephony, Internet services
and content, high speed data transmission, video, multi-media and related
activities); or

 

(b)                                 that
supports, is incidental to or is related to any such business; or

 

(c)                                  that
comprises being a Holding Company of one or more persons engaged in such
business,

 

and references to business or ordinary course
of business shall be similarly construed.

 

Business Day means:

 

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

 

(i)                                     London and
Amsterdam; and

 

(ii)                                  in
relation to a transaction involving US Dollars, New York; or

 

(b)                                 in
relation to a rate fixing day or a payment date for euros, a TARGET Day.

 

Business Plan means the
business plan for the Borrower Group for the period from the Effective Date to,
as a minimum, the Final Maturity Date as provided to the Facility Agent prior
to the Effective Date.

 

Cancellation Notice means a
notice of cancellation and/or prepayment substantially in the form of Part 2 of
Schedule 4 (Form of Cancellation and/or Prepayment Notice).

 

Capital Expenditure means any
expenditure which is or will be treated as a capital expenditure in the audited
consolidated financial statements of the Borrower Group in accordance with
GAAP.

 

Cash Flow means,
for any period, as set out in the most recent annual or semi-annual financial
statements of or in respect of the Target for that period, EBITDA of or
relating to the Target for such period:

 

(a)                                  minus
Capital Expenditure of or relating to the Target for such period;

 

(b)                                 minus all
Taxes actually paid and/or falling due for payment by or in respect of the
Target during such period;

 

(c)                                  minus the
amount of all dividends, redemptions and other distributions payable by the Target
during such period on, or in respect of any of its share capital not held by a
member of the Borrower Group;

 

6

 

(d)                                 minus any
increase or plus any decrease in working capital of or in respect of the Target
for such period;

 

(e)                                  minus the
aggregate of (i) Interest payable by or in respect of the Target during such
period and (ii) an amount equal to the Interest that would have been payable in
respect of an advance under Facility D made during such period in an amount
equal to the principal amount of Financial Indebtedness incurred in connection
with the Acquisition of the Target, and plus any Interest that was received by
the Target during such period; and

 

(f)                                    minus all
extraordinary or exceptional items (including one off restructuring costs)
which were paid by the Target during such period on (net of any cash proceeds
of insurance or warranty claims which relate to such items) and plus all
extraordinary or exceptional items which were received by or in respect of the
Target during such period.

 

For the purposes of the above calculation no
item shall be effectively deducted or credited more than once.

 

Cash Flow Positive means, in
respect of any Acquisition, for any prospective period, the sum of projected
EBITDA of or relating to the Target for such period:

 

(a)                                  minus
projected Capital Expenditure of or in respect of the Target for such period;

 

(b)                                 minus all
Taxes projected as falling due and payable by or in respect of the Target
during such period;

 

(c)                                  minus the
amount of all dividends, redemptions and other distributions projected to be
payable by the Target during such period on, or in respect of any of its share
capital not held by a member of the Borrower Group;

 

(d)                                 minus any
projected increase or plus any projected decrease in or in respect of working
capital of or in respect of the Target for such period;

 

(e)                                  minus the
amount of Interest projected to be payable by or in respect of the Target
during such period, plus any Interest that is projected to be received by or in
respect of the Target during such period;

 

(f)                                    minus all
extraordinary or exceptional items (including one off restructuring costs)
which are projected to be paid by the Target during such period on (net of any
cash proceeds of insurance or warranty claims which relate to such items) and
plus all extraordinary or exceptional items which are projected to be received
by or in respect of the Target during such period; and

 

(g)                                 plus the
amount of all Relevant Equity Injections (if any) referred to in sub-paragraphs
(c)(i)(A), (c)(i)(B) or (d)(i) of the definition of Permitted Acquisition or
sub-paragraphs (b)(i)(A) or (b)(i)(B) of the definition of Permitted Joint
Venture,

 

is greater than zero.

 

For the purposes of the above calculation no
item shall be effectively deducted or credited more than once and all items
shall be calculated by reference to, and in accordance with the principles used
in preparation of, the relevant Acquisition Business Plan.

 

7

 

Change of Control has the
meaning given to it in Clause 7.4(a) (Change of Control).

 

CNA means
Cable Networks Austria Holding B.V., a private limited liability company
incorporated under the laws of The Netherlands and, as of the Signing Date,
with its registered office at Amsterdam and its business office at Boeing
Avenue 53, 1119 PE Schiphol Rijk, Amsterdam, The Netherlands.

 

Code means the
United States Internal Revenue Code of 1986, as amended and any rule or
regulation issued thereunder from time to time in effect.

 

Commitments means the
Facility D1 Commitments, Facility D2 Commitments, Facility D3 Commitments,
Facility D4 Commitments, Facility D5 Commitments and/or Additional Facility
Commitments.

 

Confidentiality Undertaking means a
confidentiality undertaking substantially in the recommended form of either the
LMA as set out in Part 1 of Schedule 6 (Form of LMA Confidentiality
Undertaking) or the LSTA as set out in Part 2 of Schedule 6 or in any
other form agreed between UPC Distribution and the Facility Agent.

 

Connected Acquisition means an
acquisition (including without limitation by purchase, subscription or
otherwise) of:

 

(a)                                  all or any
part of the share capital or equivalent of a person or company (including
without limitation any partnership or joint venture) owned by UGCE Inc., UPC or
any of their respective Subsidiaries; or

 

(b)                                 any asset
or assets owned by UGCE Inc., UPC or any of their respective Subsidiaries, but
does not include:

 

(i)                                     the UPC
Polska Acquisition; or

 

(ii)                                  an
Acquisition from a member of the UGCE Borrower Group where, within the 12
months preceding such Acquisition, the acquired assets or shares were
themselves acquired by a member of the UGCE Borrower Group on substantially the
same terms and for substantially the same consideration;  (in the case of an Acquisition of part only
of the assets or shares initially acquired by the member of the UGCE Borrower
Group the consideration payable for that part of those assets or shares must
have been allocated to such assets or shares in the business plan prepared by
the relevant member of the UGCE Borrower Group at the time of the initial
Acquisition and must be substantially the same as the consideration paid by
such member of the UGCE Borrower Group for those assets or shares).

 

Control means the
power of a person:

 

(a)                                  by means
of the holding of shares or the possession of voting power in or in relation to
any other person; or

 

(b)                                 by virtue
of any powers conferred by the articles of association or other documents regulating
any other person,

 

to direct or cause the direction of the
management and policies of that other person,

 

and Controlled
and Controlling have a
corresponding meaning.

 

8

 

Current Assets means, at
any relevant time, the aggregate of the current assets (excluding cash) of the
Borrower Group at such time which would be included as current assets in a
consolidated balance sheet of the Borrower Group drawn up at such time in
accordance with GAAP.

 

Current Liabilities means, at
any relevant time, the aggregate of the current liabilities (excluding short
term debt and overdrafts) of the Borrower Group at such time which would be
included as current liabilities in a consolidated balance sheet of the Borrower
Group drawn up at each time in accordance with GAAP.

 

Dangerous Substance means any
radioactive emissions and any natural or artificial substance (whether in solid
or liquid form or in the form of a gas or vapour and whether alone or in
combination with any other substance) which, taking into account the
concentrations and quantities present and the manner in which it is being used
or handled, it is reasonably foreseeable will cause harm to man or any other
living organism or damage to the Environment including any controlled, special,
hazardous, toxic, radioactive or dangerous waste.

 

Default means an
Event of Default or any event or circumstances specified in Clause 18 (Default)
which would (with the expiry of a grace period or the giving of notice) be an
Event of Default.

 

Derby and EPG Agreements means:

 

(a)                                  the
licence agreement dated 29th September, 2003 between, inter  alios,
UPC Exploitation II B.V., UPC Exploitation Holding B.V., UPC and UPC
Distribution relating to the derby billing system and the electronic
programming guide; and

 

(b)                                 the escrow
agreement dated 29th September, 2003 on the deposit of sources regarding the
derby billing system and the electronic programming guide system between UPC
Exploitation II B.V., Allen & Overy and UPC Distribution.

 

Derby and EPG Share Pledges means:

 

(a)                                  the share
pledge dated 29th September, 2003 entered into between, inter alios, UPC Distribution as pledgee
and UPC Exploitation Holding B.V. as pledgor relating to all of the shares in
UPC Exploitation II B.V.; and

 

(b)                                 the share
pledge dated 29th September, 2003 entered into between UPC Distribution as
pledgee and UPC as pledgor relating to all of the shares in UPC Exploitation
Holding B.V.

 

Designated 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.

 

Distribution Business means:

 

9

 

(a)                                  the
business of upgrading, constructing, creating, developing, acquiring,
operating, owning, leasing and maintaining cable television networks (including
for avoidance of doubt master antenna television, satellite master antenna
television, single and multi-channel microwave single or multi-point
distribution systems and direct-to-home satellite systems) for the
transmission, reception and/or delivery of multi-channel television and radio
programming, telephony and internet and/or data services to the residential
markets; or

 

(b)                                 any
business which is incidental to or related to and, in either case, material to
such business.

 

Dutch Banking Act means the
Dutch Act on the Supervision of the Credit System 1992 (Wet  toezicht
Kredietwezen 1992), including the Dutch Exemption Regulation.

 

Dutch Exemption Regulation means the
Exemption Regulation of the Minister of Finance of 26th June, 2002 (Vrijstellingsregeling Wtk 1992), including
the Policy Guidelines.

 

Eastern Europe means
Europe other than Western Europe.

 

Eastern European Acquisition means an
acquisition (including, without limitation, by purchase, subscription or
otherwise) of:

 

(a)                                  all or any
part of the share capital or equivalent of a person or company (including,
without limitation any partnership or joint venture) incorporated or carrying
on a material part of its business in Eastern Europe; or

 

(b)                                 any asset
or assets constituting a business or separate line of business, a material part
of which is being carried on in Eastern Europe,

 

but excluding any such acquisition in relation
to an entity which is a Subsidiary of UPC on the Signing Date and is
incorporated or carries on business in Poland on the Signing Date.

 

EBITDA has the
meaning given to it in Clause 17.1 (Financial definitions).

 

Effective Date has the
meaning given to it in Clause 4.1 (Documentary conditions precedent).

 

Environment means the
media of air, water and land (wherever occurring) and in relation to the media
of air and water includes, without limitation, the air and water within
buildings and the air and water within other natural or man-made structures
above or below ground and any water contained in any underground strata.

 

Environmental Claim means any
claim by any person:

 

(a)                                  in respect
of any loss or liability suffered or incurred by that person as a result of or
in connection with any violation of Environmental Law; or

 

(b)                                 that
arises as a result of or in connection with Environmental Contamination and
that could give rise to any remedy or penalty (whether interim or final) that
may be enforced or assessed by private or public legal action or administrative
order or proceedings including, without limitation, any such claim that arises
from injury to persons or property.

 

Environmental Contamination means each
of the following and their consequences:

 

10

 

(a)                                  any
release, emission, leakage or spillage of any Dangerous Substance at or from
any site owned or occupied by any member of the Borrower Group into any part of
the Environment; or

 

(b)                                 any
accident, fire, explosion or sudden event at any site owned or occupied by any
member of the Borrower Group which is directly caused by or attributable to any
Dangerous Substance; or

 

(c)                                  any other
pollution of the Environment arising at or from any site owned or occupied by
any member of the Borrower Group.

 

Environmental Law means all
legislation, regulations or orders (insofar as such regulations or orders have
the force of law) to the extent that it relates to the protection or impairment
of the Environment or the control of Dangerous Substances (whether or not in
force at the date of this Agreement) which are capable of enforcement in any
applicable jurisdiction by legal process.

 

Environmental Licence means any
permit, licence, authorisation, consent, filing, registration or other approval
required by any Environmental Law.

 

ERISA means the
United States Employee Retirement Income Security Act of 1974, as amended.

 

ERISA Affiliate means
each trade or business, whether or not incorporated, that would be treated as a
single employer with any member of the Borrower Group under section 414 of
the United States Internal Revenue Code of 1986, as amended.  When any provision of this Agreement relates
to a past event, the term ERISA Affiliate
includes any person that was an ERISA Affiliate of a member of the Borrower
Group at the time of that past event.

 

EURIBOR means in
relation to any Advance or Unpaid Sum denominated in euros:

 

(a)                                  the
applicable Screen Rate for deposits in the currency of the relevant Advance or
Unpaid Sum for a period equal or comparable to the required period at or about
11.00 a.m. (Brussels time) on the applicable Rate Fixing Day; or

 

(b)                                 if the
rate cannot be determined under paragraph (a) above, the arithmetic mean
(rounded upwards, if necessary, to the nearest four decimal places) of the
respective rates, as supplied to the Facility Agent at its request, quoted by
the Reference Banks to leading banks for the offering of deposits in euros for
the required period in the London interbank market at or about 11.00 a.m. on
the Rate Fixing Day for such period,

 

and for the purposes of this definition, required period means the Interest Period
of an Advance or the period in respect of which EURIBOR falls to be determined
in relation to any Unpaid Sum.

 

€, euro or euros
means the single currency of the Participating Member States.

 

Event of Default means an
event specified as such in Clause 18 (Default).

 

Excess Cash Flow means the
aggregate consolidated EBITDA of the Borrower Group calculated for the most
recently ended financial year (beginning with the financial year ending on 31st
December, 2004), as shown in the quarterly management accounts delivered to the

 

11

 

Facility Agent pursuant to Clause 16.2(b)
(Financial information) in respect of the financial quarter ending on 31st
December in any relevant year:

 

(a)                                  less:

 

(i)                                     any
interest and other charges in respect of Financial Indebtedness of the Borrower
Group paid during such financial year;

 

(ii)                                  repayments
and/or prepayments of any Financial Indebtedness of the Borrower Group paid
during such financial year; and

 

(iii)                               capital
expenditure of the Borrower Group incurred during such financial year; and

 

(b)                                 either (i)
plus any amount by which Net Working Capital at the commencement of such
financial year exceeds Net Working Capital at the close of such financial year
or, as appropriate, (ii) minus any amount by which Net Working Capital at the
end of such financial year exceeds Net Working Capital at the beginning of such
financial year.

 

For the purposes of this definition of “Excess
Cash Flow”, Net Working Capital
means, at any time, the aggregate of the Current Assets of the Borrower Group
at such time less the aggregate of the Current Liabilities of the Borrower
Group at such time.

 

Existing Beneficiaries means
Beneficiaries as defined in the Existing Security Deed.

 

Existing Facility means a
facility made available to a borrower under the Existing Facility Agreement.

 

Existing Facility Agents means the
facility agents under the Existing Facility.

 

Existing Facility Agreement means the
senior secured credit facility dated 26th October, 2000 made between, inter alia, UPC Distribution, UPC
Financing, TD Bank Europe Limited and Toronto Dominion (Texas), Inc. as
facility agents and the banks and financial institutions listed therein, as
amended from time to time and as amended and restated on the Effective Date.

 

Existing Finance Document means a
Finance Document as defined in the Existing Facility Agreement.

 

Existing Security Deed means the
security deed dated 26th October, 2000 between, among others, UPC Distribution,
UPC Financing, UPC, UPC Holding, the Existing Facility Agents, TD Bank Europe
as security agent, the lenders and financial institutions listed therein, the
senior hedging banks, the High Yield Hedging Banks and each Subordinated
Creditor (as defined in the Existing Security Deed) and includes each Deed of
Accession (as defined in the Existing Security Deed) entered into in relation
to the Existing Security Deed.

 

Existing Security Documents means:

 

(a)                                  the
Security Documents as defined in paragraph (a) of the definition of “Security
Documents” in the Existing Facility Agreement; and

 

(b)                                 any other
Security Documents as defined in paragraph (b) of the definition of “Security
Documents” in the Existing Facility Agreement provided that the Security

 

12

 

Interest(s) granted under
any such Security Document are simultaneously granted on the same terms (save
for variations directly attributable to the identity of the parties and the
loan amounts) to the Security Agent on behalf of Beneficiaries to secure the Secured
Obligations (as defined in the Security Deed).

 

Facility means
Facility D and each Additional Facility (if any).

 

Facility A means
Facility A as defined in the Existing Facility Agreement.

 

Facility B means
Facility B as defined in the Existing Facility Agreement.

 

Facility C means
Facility C as defined in the Existing Facility Agreement.

 

Facility D means each
of Facility D1, Facility D2, Facility D3, Facility D4 and Facility D5.

 

Facility D Advance means a
Facility D1 Advance, Facility D2 Advance, Facility D3 Advance, Facility D4
Advance or Facility D5 Advance.

 

Facility D Commitments means the
Facility D1 Commitments, Facility D2 Commitments, Facility D3 Commitments,
Facility D4 Commitments and/or Facility D5 Commitments.

 

Facility D Lender means:

 

(a)                                  any
Initial Facility D Lender;

 

(b)                                 any
Additional Facility D Lender; and

 

(c)                                  any person
which has become a New Lender (as defined in Clause 26.2 (Transfers by
Lenders)) under Facility D in accordance with Clause 26 (Changes to the
Parties),

 

which in each case has not ceased to be a Party
in accordance with the terms of this Agreement.

 

Facility D1 means the
€109,371,094 term loan facility referred to in Clause 2.1(a) (Facility D).

 

Facility D1 Advance means the
advance made to UPC Distribution under Facility D1.

 

Facility D1 Commitment means:

 

(a)                                  in
relation to an Initial Facility D Lender, the amount in euros set opposite its
name under the heading “Facility D1 Commitment” in Part 2 of Schedule 1
(Initial Facility D Lenders and Commitments) and, following any allocation of
Facility D1 Commitment by the Facility Agent on the Allocation Date, the amount
in euros calculated in accordance with Clause 2.8 (Additional Facility D
Lenders) set opposite its name under the heading “Facility D1 Commitment” in
Part 3 of Schedule 1 (Facility D Commitments) and the amount of any other
Facility D1 Commitment transferred to it under this Agreement;

 

(b)                                 in
relation to an Additional Facility D Lender, the amount in euros set out in the
relevant Additional Facility D Lender Accession Agreement and, following any
allocation of Facility D1 Commitment by the Facility Agent on the Allocation
Date, the amount in euros calculated in accordance with Clause 2.8 (Additional
Facility D

 

13

 

Lenders) set out opposite
its name under the heading “Facility D1 Commitment” in Part 3 of Schedule 1
(Facility D Commitments); and

 

(c)                                  in
relation to any other Facility D Lender, the amount in euros of any Facility D1
Commitment transferred to it in accordance with this Agreement,

 

to the extent not cancelled, reduced or
transferred by it under this Agreement.

 

Facility D1 Lender means a
Facility D Lender under Facility D1.

 

Facility D2 means the
€196,867,969 term loan facility referred to in Clause 2.1(b) (Facility D).

 

Facility D2 Advance means the
advance made to UPC Distribution under Facility D2.

 

Facility D2 Commitment means:

 

(a)                                  in
relation to an Initial Facility D Lender, the amount in euros set opposite its
name under the heading “Facility D2 Commitment” in Part 2 of Schedule 1
(Initial Facility D Lenders and Commitments) and, following any allocation of
Facility D2 Commitment by the Facility Agent on the Allocation Date, the amount
in euros calculated in accordance with Clause 2.8 (Additional Facility D
Lenders) set opposite its name under the heading “Facility D2 Commitment” in
Part 3 of Schedule 1 (Facility D Commitments) and the amount of any other
Facility D2 Commitment transferred to it under this Agreement;

 

(b)                                 in
relation to an Additional Facility D Lender, the amount in euros set out in the
relevant Additional Facility D Lender Accession Agreement and, following any
allocation of Facility D2 Commitment by the Facility Agent on the Allocation
Date, the amount in euros calculated in accordance with Clause 2.8 (Additional
Facility D Lenders) set out opposite its name under the heading “Facility D2
Commitment” in Part 3 of Schedule 1 (Facility D Commitments); and

 

(c)                                  in relation
to any other Facility D Lender, the amount in euros of any Facility D2
Commitment transferred to it in accordance with this Agreement,

 

to the extent not cancelled, reduced or
transferred by it under this Agreement.

 

Facility D2 Lender means a
Facility D Lender under Facility D2.

 

Facility D3 means the
€196,867,969 term loan facility referred to in Clause 2.1(c) (Facility D).

 

Facility D3 Advance means the
advance made to UPC Distribution under Facility D3.

 

Facility D3 Commitment means:

 

(a)                                  in
relation to an Initial Facility D Lender, the amount set out in euros set
opposite its name under the heading “Facility D3 Commitment” in Part 2 of
Schedule 1 (Initial Facility D Lenders and Commitments) and, following any
allocation of Facility D3 Commitment by the Facility Agent on the Allocation
Date, the amount in euros calculated in accordance with Clause 2.8 (Additional
Facility D Lenders) set opposite its name under the heading “Facility D3
Commitment” in Part 3 of Schedule 1

 

14

 

(Facility D Commitments) and
the amount of any other Facility D3 Commitment transferred to it under this
Agreement;

 

(b)                                 in
relation to an Additional Facility D Lender, the amount in euros set out in the
relevant Additional Facility D Lender Accession Agreement and, following any
allocation of Facility D3 Commitment by the Facility Agent on the Allocation
Date, the amount in euros calculated in accordance with Clause 2.8 (Additional
Facility D Lenders) set out opposite its name under the heading “Facility D3
Commitment” in Part 3 of Schedule 1 (Facility D Commitments); and

 

(c)                                  in
relation to any other Facility D Lender, the amount in euros of any Facility D3
Commitment transferred to it in accordance with this Agreement, to the extent
not cancelled, reduced or transferred by it under this Agreement,

 

to the extent not cancelled, reduced or
transferred by it under this Agreement.

 

Facility D3 Lender means a
Facility D Lender under Facility D3.

 

Facility D4 means the
€284,364,844 term loan facility referred to in Clause 2.1(d) (Facility D).

 

Facility D4 Advance means the
advance made to UPC Distribution under Facility D4.

 

Facility D4 Commitment means:

 

(a)                                  in
relation to an Initial Facility D Lender, the amount in euros set opposite its
name under the heading “Facility D4 Commitment” in Part 2 of Schedule 1
(Initial Facility D Lenders and Commitments) and, following any allocation of
Facility D4 Commitment by the Facility Agent on the Allocation Date, the amount
in euros calculated in accordance with Clause 2.8 (Additional Facility D
Lenders) set opposite its name under the heading “Facility D4 Commitment” in
Part 3 of Schedule 1 (Facility D Commitments) and the amount of any other
Facility D4 Commitment transferred to it under this Agreement;

 

(b)                                 in
relation to an Additional Facility D Lender, the amount in euros set out in the
relevant Additional Facility D Lender Accession Agreement and, following any
allocation of Facility D4 Commitment by the Facility Agent on the Allocation
Date, the amount in euros calculated in accordance with Clause 2.8 (Additional
Facility D Lenders) set out opposite its name under the heading “Facility D4
Commitment” in Part 3 of Schedule 1 (Facility D Commitments); and

 

(c)                                  in relation
to any other Facility D Lender, the amount in euros of any Facility D4
Commitment transferred to it in accordance with this Agreement,

 

to the extent not cancelled, reduced or
transferred by it under this Agreement.

 

Facility D4 Lender means a
Facility D Lender under Facility D4.

 

Facility D5 means the
€284,364,844 term loan facility referred to in Clause 2.1(e) (Facility D).

 

Facility D5 Advance means the
advance made to UPC Distribution under Facility D5.

 

Facility D5 Commitment means:

 

15

 

(a)                                  in
relation to an Initial Facility D Lender, the amount in euros set opposite its
name under the heading “Facility D5 Commitment” in Part 2 of Schedule 1
(Initial Facility D Lenders and Commitments) and, following any allocation of
Facility D5 Commitment by the Facility Agent on the Allocation Date, the amount
in euros calculated in accordance with Clause 2.8 (Additional Facility D
Lenders) set opposite its name under the heading “Facility D5 Commitment” in
Part 3 of Schedule 1 (Facility D Commitments) and the amount of any other
Facility D5 Commitment transferred to it under this Agreement;

 

(b)                                 in
relation to an Additional Facility D Lender, the amount in euros set out in the
relevant Additional Facility D Lender Accession Agreement and, following any
allocation of Facility D5 Commitment by the Facility Agent on the Allocation
Date, the amount in euros calculated in accordance with Clause 2.8 (Additional
Facility D Lenders) set out opposite its name under the heading “Facility D5
Commitment” in Part 3 of Schedule 1 (Facility D Commitments); and

 

(c)                                  in
relation to any other Facility D Lender, the amount in euros of any Facility D5
Commitment transferred to it in accordance with this Agreement,

 

to the extent not cancelled, reduced or
transferred by it under this Agreement.

 

Facility D5 Lender means a
Facility D Lender under Facility D5.

 

Facility Office means the
office(s) notified by a Lender to the Facility 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.

 

Fee Letter means  the letter between the Facility Agent and
UPC Distribution, dated on or about the Signing Date, setting out the amount of
agency fees referred to in Clause 20.2 (Agent’s fees).

 

Final Maturity Date means:

 

(a)                                  when
designated “Facility D”, 30th June, 2009; and

 

(b)                                 when
designated “Additional Facility”, the date falling after 30th June, 2009
specified in the Additional Facility Accession Agreement,

 

or, in each case if that day is not a Business
Day, the immediately preceding Business Day (and without any such designation
means the latest such date).

 

Finance Document means this
Agreement, a Security Document, the Security Deed, a Fee Letter, an Obligor
Accession Agreement, a Novation Certificate, an Additional Facility Accession
Agreement, the Intercreditor Agreement and any other document designated in
writing as such by the Facility Agent and UPC Distribution.

 

Finance Party means a
Lender, the Facility Agent or the Security Agent.

 

Financial Indebtedness means,
without double counting, indebtedness in respect of:

 

16

 

(a)                                  money
borrowed or raised and debit balances at banks;

 

(b)                                 any bond,
note, loan stock, debenture or similar debt instrument;

 

(c)                                  acceptance
or documentary credit facilities;

 

(d)                                 receivables
sold or discounted (otherwise than on a non-recourse basis and other than in
the normal course of business for collection);

 

(e)                                  payments
for assets acquired or services supplied deferred for a period of over 180 days
(or 360 days if such deferral is in accordance with the terms pursuant to which
the relevant assets were or are to be acquired or services were or are to be
supplied) after the relevant assets were or are to be acquired or the relevant
services were or are to be supplied;

 

(f)                                    finance
leases and hire purchase contracts to the extent that they constitute capital
leases within the meaning of GAAP, provided that indebtedness in respect of
network leases shall only be included in this paragraph (f) for the purposes of
the definition of “Excess Cash  Flow”
and Clause 18.5 (Cross default);

 

(g)                                 any other
transaction (including without limitation forward sale or purchase agreements)
having the commercial effect of a borrowing or raising of money or any of (b)
to (f) above;

 

(h)                                 (for the
purposes of Clause 18.5 (Cross default) only) any derivative transaction
entered into in connection with protection against or benefit from fluctuation
in any rate or price (and, when calculating the value of any derivative
transaction, only the marked-to-market value shall be taken into account); and

 

(i)                                     guarantees
in respect of indebtedness of any person falling within any of paragraphs (a) to
(g) above (including for the avoidance of doubt, without double counting,
guarantees given by a member of the Borrower Group for the indebtedness of the
type falling within (a) to (g) above of another member of the Borrower Group),

 

provided that indebtedness which has been
cash-collateralised shall not be included in any calculation of Financial
Indebtedness to the extent so cash-collateralised and indebtedness which is in
the nature of equity (other than redeemable shares) shall not be regarded as
Financial Indebtedness.

 

GAAP means
generally accepted accounting principles and practices in the United States.

 

Guaranteed Document means each
Finance Document and the High Yield Hedging Agreements.

 

Guarantor means each
Original Guarantor and each Additional Guarantor.

 

High Yield Hedging Agreements has the
meaning given to it in the Security Deed.

 

High Yield Hedging Bank means a
Lender or its Affiliate or a “Lender” or its “Affiliate” as defined in the
Existing Facility Agreement which is or becomes a party to the Existing
Security Deed and/or the Security Deed as a High Yield Hedging Bank.

 

High Yield Hedging
Counterparty means any member of the UGCE Borrower Group that
enters into a High Yield Hedging Agreement.

 

17

 

High Yield Notes means high
yield debt securities or other instruments not mandatorily convertible into
equity, in each case issued by a company which is a member of the UGCE Borrower
Group.

 

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

 

Indentures means
each of:

 

(a)                                  the
indenture dated as of 30th July, 1999 between UPC and Citibank N.A. in relation
to US$735,000,000 121⁄2 per cent. senior discount notes due 2009;

 

(b)                                 the
indenture dated 5th February, 1998 between UGC and Firstar Bank of Minnesota
N.A. (the UGC Trustee) for the
$1,375,000,000 103⁄4 per cent. senior secured discount notes due 2009;

 

(c)                                  the
indenture dated 15th April, 1999 between UGC and the UGC Trustee for the
$355,000,000 senior discount notes due 2009;

 

(d)                                 the indenture dated
30th July, 1999 between UPC and Citibank N.A. for the $800,000,000 10 7/8 per cent.
senior notes due 2009 and the €300,000,000 10 7/8 per cent.
senior notes due 2009;

 

(e)                                  the indenture dated 29th October, 1999 between UPC and
Citibank N.A. for the $200,000,000 10 7/8 per cent. senior notes due 2007 and the €100,000,000
10 7/8 per cent.
senior notes due 2007;

 

(f)                                    the indenture dated 29th October, 1999 between UPC and
Citibank N.A. for the $252,000,000 111⁄4 per cent. senior notes due 2009 and the
€101,000,000 111⁄4 per cent. senior notes due 2009;

 

(g)                                 the indenture dated 29th October, 1999 between UPC and
Citibank N.A. for the $478,000,000 13 3/8 per cent.
senior discount notes due 2009 and the €191,000,000 13 3/8 per cent.
senior discount notes due 2009;

 

(h)                                 the indenture dated 20th January, 2000 between UPC and
Citibank N.A. for the $300,000,000 111⁄2 per cent. senior notes due 2010;

 

(i)                                     the indenture dated 20th January, 2000 between UPC and
Citibank N.A. for $600,000,000 111⁄4 per cent. senior notes due 2010 and the
€200,000,000 111⁄4 per cent. senior notes due 2010; and

 

(j)                                     the indenture dated 20th January, 2000 between UPC and
Citibank N.A. for the $1,000,000,000 133⁄4 per cent. senior discount notes due
2010,

 

in each case as
in effect on 26th October, 2000.

 

Initial
Additional Facility Lender means a person
which becomes a Lender under an Additional Facility pursuant to Clause 2.2
(Additional Facilities).

 

Intellectual
Property Rights means all
know-how, patents, trade marks, designs and design rights, trading names,
copyrights (including any copyright in computer software), database rights and
other intellectual property rights anywhere in the world (in each case whether
registered or not and including all applications for the same).

 

18

 

Interconnect
Agreements means each
interconnection agreement, network contract, franchise agreement,
telecommunications service agreement and any agreement of a similar nature
entered into by any member of the Borrower Group in connection with the conduct
of its business as may be permitted by the terms of this Agreement (including
any interconnect agreements maintained pursuant to Clause 16.20
(Inter-connection and chello)).

 

Intercreditor
Agreement means the intercreditor
deed entered into on or about the date of this Agreement between, among others,
the Facility Agent and the Security Agent, the facility agent and security
agent under the Existing Facility Agreement and UPC Distribution.

 

Interest
has the meaning given to it in Clause 17.1
(Financial definitions).

 

Interest
Date means the last day of
an Interest Period.

 

Interest
Period means each period
determined in accordance with Clause 8 (Interest).

 

Lender means each Facility D Lender and each Additional
Facility Lender (if any).

 

LIBOR
means in relation to any Advance or Unpaid Sum
denominated in US Dollars:

 

(a)                                  the applicable Screen Rate for deposits in US Dollars
for a period equal or comparable to the required period at or about 11.00 a.m.
on the applicable Rate Fixing Day; or

 

(b)                                 (if no Screen Rate is available for the required
currency or required period of that Advance or Unpaid Sum) the arithmetic mean
(rounded upwards, if necessary, to the nearest four decimal places) of the
respective rates, as supplied to the Facility Agent at its request, quoted by
the Reference Banks to leading banks for the offering of deposits in the required
currency and for the required period in the London interbank market at or about
11.00 a.m. on the Rate Fixing Day for such period,

 

and for the
purposes of this definition, required period
means the applicable Interest Period of an Advance or the period in respect of
which LIBOR falls to be determined in relation to any Unpaid Sum.

 

Licence
means each approval, consent, authorisation and
licence from, and all filings, registrations and agreements with any
governmental or regulatory authority, in each case granted, issued, made or
entered into pursuant to any Telecommunications and Cable Law necessary in
order to enable each member of the Borrower Group to carry on its business as
may be permitted by the terms of this Agreement.

 

LMA
means the Loan Market Association.

 

Majority
Acquisition has the meaning given
in paragraph (c) of the definition of “Permitted Acquisition”.

 

Majority
Lenders means, at any time
Lenders the aggregate of whose undrawn Facility D Commitments, and undrawn
Additional Facility Commitments  (translated
into euros, where such Commitment is denominated in US Dollars, on the basis of
the Agent’s Spot Rate of Exchange on the date of the Additional Facility
Accession Agreement) and participations in outstanding Facility D Advances and
Additional Facility Advances (calculated by reference to the Original Euro
Amount of such Advances) exceeds 66 2/3 per cent. of the
aggregate undrawn Total Facility D1 Commitments, undrawn Total Facility D2
Commitments, undrawn Total Facility D3 Commitments, undrawn Total Facility D4
Commitments, undrawn Facility

 

19

 

D5 Commitments,
undrawn Total Additional Facility Commitments for all Additional Facilities and
the Original Euro Amount of outstanding Advances.

 

Management
Fees means any management,
consultancy or similar fees payable by any member of the Borrower Group to any
Restricted Person.

 

Mandatory
Cost means the percentage
rate per annum calculated by the Facility Agent in accordance with
Schedule 3 (Mandatory Cost Formulae).

 

Margin
means:

 

(a)                                  in the case of 
Facility D 5.50 per cent.; and

 

(b)                                 in the case of the Additional Facility the amount
specified in the Additional Facility Accession Agreement, such rate not to
exceed the Margin applicable in relation to Facility D.

 

Material
Adverse Effect means any event
or circumstance which has a material adverse effect on the ability of the
Obligors (taken as a whole) to perform their payment or other material
obligations under any of the Finance Documents.

 

Material
Contracts means:

 

(a)                                  the Interconnect Agreements;

 

(b)                                 the agreement between chello Broadband N.V. and UPC
Distribution documenting the arrangement under which chello Broadband N.V. and
UPC Distribution share the subscriber revenues generated from the chello
broadband internet service;

 

(c)                                  the Priority Pledge;

 

(d)                                 the Derby and EPG Pledges;

 

(e)                                  the Derby and EPG Agreements;

 

(f)                                    the Shareholders’ Agreements as from time to time
amended, varied, restated or replaced, in each case in a manner that does not
constitute an Event of Default under Clause 18.18 (Material Contracts); and

 

(g)                                 each other agreement agreed as such by the Facility
Agent and UPC Distribution.

 

Material
Subsidiary means any Subsidiary of
UPC Distribution which accounts for more than five per cent. of one or more of:

 

(a)                                  the book value of the consolidated assets of the
Borrower Group; or

 

(b)                                 the consolidated revenues of the Borrower Group; or

 

(c)                                  consolidated EBITDA of the Borrower Group,

 

all as shown in
the financial statements most recently delivered under Clause 16.2(a) or (b)
(Financial information) (except that for purposes of determining the
consolidated revenues and consolidated EBITDA of the Borrower Group in respect
of the financial statements delivered under Clause 16.2(b) (Financial
information), the respective amounts of such revenues and such EBITDA shall
equal two times the consolidated revenues and consolidated

20

 

EBITDA,
respectively, of the Borrower Group during the relevant Ratio Period ending on
the date to which such financial statements are prepared).

 

If a Subsidiary
which is not a Material Subsidiary on the basis of the most recent such
financial statements most recently delivered receives on any date (the Relevant Date) a transfer of assets or the
right to receive any revenues or other earnings which, taken together with the
existing assets or, as the case may be, revenues or earnings of that
Subsidiary, would satisfy either of the tests in paragraphs (a), (b) or (c)
above, then that Subsidiary shall also be a Material Subsidiary on and from the
Relevant Date.  If a Material Subsidiary
disposes of any assets or the right to receive any revenues or earnings such
that it would on the basis of the most recent such financial statements most
recently delivered cease to be a Material Subsidiary, then it shall be excluded
as a Material Subsidiary on and from the date it makes such disposal.

 

Necessary
Authorisations means all
material approvals, consents, authorisations and licences (other than the
Licences) from, all rights granted by and all filings, registrations and
agreements with, any government or other regulatory authority necessary in
order to enable each member of the Borrower Group to carry on its business as
may be permitted by the terms of this Agreement as carried on by it at the
relevant time.

 

Net
Equity Proceeds means any cash
proceeds (net of issue expenses) received by or for the account of a member of
UGCE Borrower Group from any issued securities constituting or convertible or
exchangeable (with or without conditions) into, share capital of that member of
the UGCE Borrower Group (but excluding any proceeds received from an issue of
Relevant Convertible Preference Shares).

 

Net
Proceeds means the aggregate
cash (or cash equivalent) proceeds received by any member of the Borrower Group
in consideration for or otherwise in respect of a relevant disposal, net of all
Taxes applicable on, or to any gain resulting from, that disposal and of all
reasonable costs, fees and expenses properly incurred by continuing members of
the Borrower Group in arranging and effecting that disposal.

 

Network
means the networks operated from time to time
by any member of the Borrower Group pursuant to the Licences and in accordance
with this Agreement.

 

non-Distribution
Business Assets has the meaning
given to it in Clause 16.10(b)(ix) (Disposals).

 

Novation
Certificate has the meaning given
to it in Clause 26.3(a)(i) (Procedure for novations).

 

Obligor
means a Borrower or a Guarantor including, for
the purposes of Clause 18 (Default), any Subsidiary of UPC Distribution that is
required to become a Guarantor under Clause 26.4 (Additional Obligors) but has
not yet become a Guarantor.

 

Obligor
Accession Agreement means a deed in
the form of Part 3 of Schedule 5 (Obligor Accession Agreement), with such
amendments as the Facility Agent may approve or reasonably require (including,
without limitation, any limitation on the obligations of the relevant
Additional Guarantor which has been approved by the Facility Agent pursuant to
Clause 26.4(a)(vi) (Additional Obligors).

 

Obligor
Pledge of Shareholder Loans means the deeds of pledge of shareholder loans entered into between
certain Obligors and the Security Agent listed in sub-paragraphs 3(a), (c),
(d), (e), (f) and (g) of Schedule 7 (Security Documents) and any other
deed of pledge of

 

21

 

shareholder
loans in substantially the same form entered into by an Obligor pursuant to any
such deed of pledge or Clause 16.14(a) (Loans and guarantees) or Clause 26.4
(Additional Obligors).

 

Obligors’
Framework Agreement means the
Framework Agreement (as defined in any Obligor Pledge of Shareholder Loans).

 

Original
Borrower Group Financial Statements means the financial statements of the Borrower Group for the Accounting
Period ended 31st March, 2003 (comprising the unaudited compiled financial
statements of each of the Obligors for the Accounting Period ended 31st March,
2003 and a combination of those financial statements).

 

Original
Euro Amount means:

 

(a)                                  the principal amount of a Facility D1 Advance,
Facility D2 Advance, Facility D3 Advance, Facility D4 Advance, Facility D5
Advance or Additional Facility Advance (as applicable) denominated in euros; or

 

(b)                                 the principal amount of an Additional Facility Advance
denominated in US Dollars, translated into euros on the basis of the Agent’s
Spot Rate of Exchange on the date of receipt by the Facility Agent of the
Request for the relevant Advance.

 

Participating
Member State means a member state of
the European Community that adopts or has adopted the euro as its lawful
currency in accordance with legislation of the European Community for Economic
Monetary Union.

 

Party
means a party to this Agreement.

 

Permitted
Acquisition means:

 

(a)                                  [intentionally left blank]

 

(b)                                 any Acquisition of a member of the Borrower Group by
any other member of the Borrower Group as part of the solvent reorganisation of
the Borrower Group; or

 

(c)                                  any Acquisition where, upon completion of the
Acquisition, the person acquired will be a Subsidiary of UPC Distribution or
where UPC Distribution or one of its Subsidiaries which is a member of the
Borrower Group will own directly or indirectly greater than a 50 per cent.
interest in the asset or assets constituting the acquired business (a Majority Acquisition) and where:

 

(i)                                     the Acquisition Cost of that Majority Acquisition,
when aggregated with the Acquisition Cost of all Majority Acquisitions made
since the Signing Date, but deducting:

 

(A)                              the amount of any such Acquisition Cost which has been
directly or indirectly funded (whether before, at or after the time of
completion of the Acquisition) by the proceeds of a Relevant Equity Injection
(other than any Relevant Equity Injection referred to in sub-paragraph (c)(i)
(B) or paragraph (c)(i)(l) below);

 

(B)                                the amount of any such Acquisition Cost which has been
directly funded (in whole or in part) by the proceeds of a drawing under
Facility A, provided that such deduction shall only be made to the 

 

22

 

extent that, prior to the date of the Majority Acquisition, the
outstandings under Facility A were reduced out of the proceeds of a Relevant
Equity Injection (and excluding the amount of any such reduction of
outstandings under Facility A to the extent that Facility A has previously been
drawn for the purposes of funding (in whole or in part) a Permitted
Acquisition) and further provided that, at the time such reduction was made,
UPC Distribution delivered to the Facility Agent a certificate signed by two
managing directors or the sole managing director of UPC Distribution
certifying:

 

I.                                         that the amount of the reduction was funded from a
Relevant Equity Injection; and

 

II.                                     that UPC Distribution intended to draw an amount up to
such amount under Facility A following the date of the reduction in order to
fund a Permitted Acquisition;

 

(C)                                the Acquisition Cost of all such Majority Acquisitions
of any entity in which a member of the Borrower Group has an ownership interest
at the Signing Date (as defined in the Existing Facility Agreement) or acquired
an ownership interest pursuant to the Restructuring;

 

(D)                               the Acquisition Cost of any Acquisition constituting a
Majority Acquisition made pursuant to paragraph (b) above; and

 

(E)                                 the Acquisition Cost of the Acquisition of one or more
cable television networks in the Netherlands, as disclosed in writing to the
Facility Agent before the Signing Date (as defined in the Existing Facility
Agreement), and/or any business which is incidental or related thereto, in an
aggregate amount that does not exceed €60,000,000,

 

does not exceed:

 

(1)                                  (except in the case of a Connected Acquisition) the
sum of (x) €250,000,000 and (y) an amount equal to the proceeds of all Relevant
Equity Injections made since the Effective Date to the extent only that the
proceeds of such Relevant Equity Injection have been applied to permanently
prepay and cancel the outstandings under Facility A, Facility B, Facility C or
Facility D since the Effective Date provided that, at the time that any such
prepayment and cancellation was made, UPC Distribution delivered to the
Facility Agent a certificate signed by two managing directors or the sole
managing director of UPC Distribution certifying that the amount of the
prepayment and cancellation was funded from a Relevant Equity Injection;

 

(2)                                  in the case of a Connected Acquisition, €0; or

 

(3)                                  in the case of the UPC Polska Acquisition, and subject
always to sub-paragraph (1) above, the aggregate principal amount of any debt
securities issued by UPC Polska (together with any interest owing in respect of
such debt securities) in connection with the UPC Polska Restructuring;

 

23

 

(ii)                                  if the higher of the Acquisition Cost and the book
value of any Majority Acquisition (or, where an opinion confirming the fairness
of the relevant Majority Acquisition from a financial point of view has been
issued by an independent third party, the Acquisition Cost of any Majority
Acquisition):

 

(A)                              is greater than €100,000,000 and no more than
€150,000,000, UPC Distribution delivers a certificate to the Facility Agent
signed by two managing directors or the sole managing director, as the case may
be, of UPC Distribution and certifying; or

 

(B)                                is greater than €150,000,000, UPC Distribution
delivers to the Facility Agent financial projections based on assumptions which
are no more aggressive (when taken as a whole) than those used in the
preparation of the Business Plan which demonstrate,

 

that the
Borrowers will be in compliance with Clause 6 (Repayment) and the undertakings
set out in Clause 17 (Financial Covenants) for the period from completion of
the Acquisition (taking into account the Acquisition Cost of such Majority
Acquisition (but deducting from that Acquisition Cost the value of any
consideration referred to in paragraph (a) of the definition of “Acquisition
Cost”) and financial projections relating to the acquired business or asset(s))
to the Final Maturity Date;

 

(iii)                               the business of the acquired entity or the business
acquired, as the case may be, is of the same nature as the business of the
Borrower Group as at the Signing Date (as defined in the Existing Facility
Agreement) and is carried out principally in Europe;

 

(iv)                              in the case of any Majority Acquisition where the
Acquisition Cost is €40,000,000 or greater, UPC Distribution delivers to the
Facility Agent an Acquisition Business Plan which:

 

(A)                              must contain cash flow projections which show that the
Target will be Cash Flow Positive (taking into account the amount of any
Relevant Equity Injection referred to in sub-paragraph (c)(i)(A) and (c)(i)(B)
above) from the date of the proposed Majority Acquisition up to and including
the Final Maturity Date; and

 

(B)                                in relation to any Majority Acquisition completed
prior to 31st December, 2006, must contain cash flow projections which show
that the sum of the undrawn Total Facility A Commitments (as defined under the
Existing Facility Agreement) and Unrestricted Cash, taking into account the
proposed Majority Acquisition, is projected to be greater than €100,000,000 on
31st December, 2006;

 

(v)                                 UPC Distribution delivers to the Facility Agent the
most recent annual or semi-annual financial statements of or relating to the
Target, together with a certificate signed by two managing directors or the
sole managing director, as the case may be, of UPC Distribution certifying the
amount of the Cash Flow of the Target for the most recent half financial year
of, or relating to, the Target and setting out the supporting calculations;

 

(vi)                              no Default has occurred and is continuing or would be
caused by the Majority Acquisition; and

 

24

 

(vii)                           the Acquisition Cost of that Majority Acquisition is
not funded from the proceeds of an advance drawn by a Borrower under the
Additional Facility; or

 

(d)                                 any Additional Acquisition where:

 

(i)                                     the Acquisition Cost of that Additional Acquisition,
when aggregated with the Acquisition Cost of all Additional Acquisitions made
since the Effective Date, but deducting the amount of any such Acquisition Cost
which has been directly or indirectly funded (whether before, after or at
completion of the Additional Acquisition) by the proceeds of any Relevant
Equity Injection, does not exceed €1,000,000,000;

 

(ii)                                  UPC Distribution delivers to the Facility Agent the
most recent annual or semi-annual financial statements of the Target, together
with a certificate, signed by two managing directors or the sole managing director
of UPC Distribution, which certifies that the ratio of Senior Debt to
Annualised EBITDA (including any Senior Debt used to fund the Acquisition Cost
of that Additional Acquisition) for the most recent half financial year set out
in the most recent financial statements of the Target is:

 

(A)                              less than 4.0:1; or

 

(B)                                at least 1.0 (one) times lower than the ratio of
Senior Debt to Annualised EBITDA of the Borrower Group for the most recent
Ratio Period, as shown in the most recent set of financial statements delivered
under Clause 16.2(a) or (b) (Financial information); and

 

(iii)                               an Acquisition Business Plan which, in the case of any
Additional Acquisition where the Acquisition Cost is €25,000,000 or greater
must contain cash flow projections which show that the Target will be Cash Flow
Positive (taking into account the amount of any Relevant Equity Injection
referred to in sub-paragraph (d)(i) above) from the date of the proposed
Additional Acquisition up to and including the Final Maturity Date;

 

(iv)                              UPC Distribution delivers to the Facility Agent the
most recent annual or semi-annual financial statements of or relating to the
Target, together with a certificate signed by two managing directors or the
sole managing director, as the case may be, of UPC Distribution certifying the
amount of the Cash Flow of the Target for the most recent half financial year
of, or relating to, the Target and setting out supporting calculations;

 

(v)                                 no Default has occurred and is continuing or would be
caused by the Additional Acquisition; and

 

(vi)                              the Acquisition Cost of that Additional Acquisition is
funded (in whole or in part) by one or more advances drawn by UPC Distribution
under an Additional Facility and any balance of the Acquisition Cost not funded
by drawings under an Additional Facility are funded directly or indirectly by
one or more Relevant Equity Injections.

 

(e)                                  any Majority Acquisition which is also an Additional
Acquisition where:

 

25

 

(i)                                     the Acquisition Cost of that Acquisition exceeds both
the available limit permitted for Majority Acquisitions under sub-paragraph
(c)(i)(1) above at the relevant time (the Majority
Acquisitions Available Limit) and the available limit permitted for
Additional Acquisitions under sub-paragraph (d)(i) above at the relevant time
(the Additional Acquisitions Available Limit)
but does not exceed the aggregate of the Majority Acquisitions Available Limit
and the Additional Acquisitions Available Limit;

 

(ii)                                  that Acquisition satisfies all the requirements set
out in paragraphs (c) and (d) above other than:

 

(A)                              the Acquisition Cost being in excess of the Majority
Acquisitions Available Limit and the Additional Acquisitions Available Limit as
described above; and

 

(B)                                sub-paragraphs (c)(vii) and (d)(vi); and

 

(iii)                               the Acquisition Cost of that Acquisition is funded (up
to the amount of the Additional Acquisitions Available Limit) wholly or partly
from the proceeds of a drawing under an Additional Facility and any balance not
funded by drawings under an Additional Facility (up to the Additional
Acquisitions Available Limit) are funded directly or indirectly by one or more
Relevant Equity Injections, with the balance of the Acquisition Cost (in excess
of the Additional Acquisitions Available Limit) funded by any other means
permitted under this Agreement.

 

All references
in this definition to euro or € shall, where applicable, mean the equivalent in
any other currency, converted to euro, based on the Agent’s Spot Rate of
Exchange at the relevant time.

 

Permitted
Business means the carrying on
of the Business in Europe.

 

Permitted
Financial Indebtedness has the meaning
given to it in Clause 16.12(b) (Restrictions on Financial Indebtedness).

 

Permitted
Joint Venture means:

 

(a)                                  any Acquisition referred to in paragraph (b) of the
definition of “Permitted Acquisition” and any Acquisition as a result of a
reorganisation of a person that is not a Subsidiary of UPC Distribution but in
which a member of the Borrower Group has an interest, provided that such
reorganisation does not result in an overall increase in the value of the
Borrower Group’s interest in that person, other than adjustments to the basis
of any member of the Borrower Group’s interest in accordance with GAAP; or

 

(b)                                 any Acquisition where, upon completion of the
Acquisition, the person acquired will not be a Subsidiary of UPC Distribution
or where UPC Distribution or one of its Subsidiaries which is a member of the
Borrower Group will own directly or indirectly no more than a 50 per cent.
interest in the asset or assets constituting the acquired business (a JV Minority Acquisition) and where:

 

(i)                                     the Acquisition Cost of that JV Minority Acquisition,
when aggregated with the Acquisition Cost of all JV Minority Acquisitions made
since the Signing Date, but deducting:

 

26

 

(A)                              the amount of any such Acquisition Cost which has been
directly or indirectly funded (whether before, at or after, the time of
completion of the Acquisition) by the proceeds of a Relevant Equity Injection
(other than any Relevant Equity Injection referred to in sub-paragraph
(b)(i)(B) or paragraph (b)(i)(l) below);

 

(B)                                the amount of any such Acquisition Cost which has been
directly funded (in whole or in part) by the proceeds of a drawing under
Facility A, provided that such deduction shall only be made to the extent that,
prior to the date of the JV Minority Acquisition, the outstandings under
Facility A were reduced out of the proceeds of a Relevant Equity Injection (and
excluding the amount of any such reduction of outstandings under Facility A to
the extent that Facility A has previously been drawn for the purposes of
funding (in whole or in part) a Permitted Joint Venture) and further provided
that, at the time such reduction was made, UPC Distribution delivered to the
Facility Agent a certificate signed by two managing directors or the sole
managing director of UPC Distribution certifying:

 

I.                                         that the amount of the reduction was funded from a
Relevant Equity Injection; and

 

II.                                     that UPC Distribution intended to draw an amount up to
such amount under Facility A following the date of the reduction in order to
fund a Permitted Joint Venture;

 

(C)                                the Acquisition Cost of all such JV Minority
Acquisitions of any entity in which a member of the Borrower Group has an
ownership interest at the Signing Date (as defined in the Existing Facility
Agreement) or acquired an ownership interest pursuant to the Restructuring; and

 

(D)                               the Acquisition Cost of any Acquisition constituting a
JV Minority Acquisition made pursuant to paragraph (a) above,

 

does not exceed:

 

(1)                                  (except in the case of a Connected Acquisition) the
sum of (x) €250,000,000 and (y) an amount equal to the proceeds of all Relevant
Equity Injections made since the Effective Date, to the extent only that the
proceeds of such Relevant Equity Injection have been applied to permanently
prepay and cancel the outstandings under Facility A, Facility B, Facility C or
Facility D since the Effective Date provided that, at the time that any such
prepayment and cancellation was made, UPC Distribution delivered to the
Facility Agent a certificate signed by two managing directors or the sole
managing director of UPC Distribution certifying that the amount of the
prepayment and cancellation was funded from a Relevant Equity Injection; or

 

(2)                                  in the case of a Connected Acquisition, €0;

 

(ii)                                  if the higher of the Acquisition Cost and the book
value of any JV Minority Acquisition (or, where an opinion confirming the
fairness of the relevant JV Minority Acquisition from a financial point of view
has been issued by an

 

27

 

 

independent third party, the Acquisition Cost of any JV Minority
Acquisition):

 

(A)                              is greater than €50,000,000, UPC Distribution delivers
a certificate to the Facility Agent signed by two managing directors or the
sole managing director, as the case may be, of UPC Distribution and certifying;
or

 

(B)                                is greater than €100,000,000, UPC Distribution
delivers to the Facility Agent financial projections based on assumptions which
are no more aggressive (when taken as a whole) than those used in the
preparation of the Business Plan which demonstrate,

 

that the
Borrowers will be in compliance with Clause 6 (Repayment) and the undertakings
set out in Clause 17 (Financial Covenants) for the period from completion of
the JV Minority Acquisition (taking into account the Acquisition Cost of such
JV Minority Acquisition (but deducting from that Acquisition Cost the value of
any consideration referred to in paragraph (a) of the definition of
“Acquisition Cost”) and financial projections relating to the acquired business
or asset(s)) to the Final Maturity Date;

 

(iii)                               the business of the acquired entity or the business
acquired, as the case may be, is of the same nature as the business of the
Borrower Group as at the Signing Date (as defined in the Existing Facility
Agreement) and is carried out principally in Europe;

 

(iv)                              in the case of any JV Minority Acquisition where the
Acquisition Cost is €40,000,000 or greater, UPC Distribution delivers to the
Facility Agent an Acquisition Business Plan which:

 

(A)                              must contain cash flow projections which show that the
Target will be Cash Flow Positive (taking into account the amount of any Relevant
Equity Injection referred to in sub-paragraph (b)(i)(A) and (b)(i)(B) above)
from the date of the proposed JV Minority Acquisition up to and including the
Final Maturity Date; and

 

(B)                                in relation to any JV Minority Acquisition completed
prior to 31st December, 2006, must contain cash flow projection which show that
the sum of the undrawn Total Facility A Commitments (as defined in the Existing
Facility Agreement) and Unrestricted Cash, taking into account the proposed JV
Minority Acquisition, is projected to be greater than €100,000,000 on 31st
December, 2006;

 

(v)                                 UPC Distribution delivers to the Facility Agent the
most recent annual or semi-annual financial statements of or relating to the
Target, together with a certificate signed by two managing directors or the
sole managing director, as the case may be, of UPC Distribution certifying the
amount of the Cash Flow of the Target for the most recent half financial year
of, or relating to, the Target setting out the supporting calculations;

 

(vi)                              no Default has occurred and is continuing or would be
caused by the JV Minority Acquisition; and

 

28

 

(vii)                           the Acquisition Cost of that JV Minority Acquisition
is not funded from the proceeds of an advance drawn by a Borrower under the
Additional Facility.

 

Permitted
Payment has the meaning given
to it in Clause 16.13(c) (Restricted Payments).

 

Permitted
Security Interest means:

 

(a)                                  any Security Interest arising hereunder or under any
Security Document;

 

(b)                                 any Security Interest arising under any Existing
Security Document;

 

(c)                                  any liens arising in the ordinary course of business
by way of contract which secure indebtedness under any agreement for the supply
of goods or services in respect of which payment is not deferred for more than
180 days (or 360 days if such deferral is in accordance with the terms pursuant
to which the relevant goods were acquired or services were provided);

 

(d)                                 any Security Interest imposed by any taxation or
governmental authority in respect of amounts which are being contested in good
faith and not yet payable and for which adequate reserves have been set aside
in the books of the Borrower Group (or, as the case may be, UPC Distribution
Holdco) in respect of the same in accordance with GAAP;

 

(e)                                  any Security Interests approved in writing by the
Agent (acting on the instructions of the Majority Lenders);

 

(f)                                    any Security Interest in favour of any bank incurred
in relation to any cash management arrangements;

 

(g)                                 rights of set-off arising in the ordinary course of
business;

 

(h)                                 any Security Interest securing any Financial
Indebtedness referred to in Clause 16.12(b)(xi) (Restrictions on Financial
Indebtedness), provided that (A) such Security Interest was not created in
contemplation of the acquisition of such company, (B) the debt secured by such
Security Interest is not increased beyond that secured at the date the company
in question is acquired and such Security Interest secures only that debt and
(C) such Encumbrance is discharged within 12 months of completion of the
relevant acquisition;

 

(i)                                     any Security Interest over non-Distribution Business
Assets referred to in Clause 16.12(b)(xii) (Restrictions on Financial
Indebtedness), securing Financial Indebtedness described therein or any other
obligation in respect of such non-Distribution Business Assets;

 

(j)                                     the Security Interest arising under the deed of pledge
and deed of mortgage (the KTA Pledge and
Mortgage) that was granted to the Municipality of Amsterdam by
Kabletelevise Amsterdam B.V. (KTA)
on 8th May, 2002 under the agreement between the Municipality of Amsterdam and
KTA in respect of the construction, maintenance and operation of a cable
network in the Municipality of Amsterdam provided that no material changes are
made to the terms of the KTA Pledge and Mortgage;

 

29

 

(k)                                  Security Interests arising under agreements entered
into in the ordinary course of business relating to (i) network leases or (ii)
the leasing of (A) building; (B) cars; and (C) other operational equipment; and

 

(l)                                     any Security Interests not falling within paragraphs
(a) to (k) above and securing indebtedness (other than indebtedness in relation
to an Acquisition) not exceeding €15,000,000 (or its equivalent).

 

Plan
means a plan that is subject to
section 302 or regulated by Title IV of ERISA maintained by any member of
the Borrower Group or any ERISA Affiliate currently or at any time within the
last five years, or to which any member of the Borrower Group or any ERISA
Affiliate is required to make payments or contributions or has made payments or
contributions within the past five years.

 

Pledge
of Subordinated Shareholder Loans means the deed of pledge and subordination of Subordinated Shareholder
Loans entered into between certain Restricted Persons and the Security Agent
listed in sub-paragraph 3(b) of Schedule 7 (Security Documents) and any
other deed of pledge entered into pursuant to any such deed of pledge or Clause
16.25(a) (Shareholder Loans).

 

Priority
Pledge means the pledge
entered into between UPC Distribution as pledgee and Priority Telecom
Netherlands N.V. as pledgor dated 30th August, 2002 in relation to telephony
switches.

 

Professional
Market Party means a professional
market party (professionele marktpartij)
under the Dutch Exemption Regulation.

 

Rate
Fixing Day means:

 

(a)                                  the second Business Day before the Utilisation Date of
an Advance denominated in US Dollars; or

 

(b)                                 the second TARGET Day before the Utilisation Date of
an Advance denominated in euros,

 

or such other
day on which it is market practice in the London or, as the case may be,
European interbank market for leading banks to give quotations in the relevant
currency for delivery on the first day of the relevant Utilisation Date.

 

Ratio
Period has the meaning given
to it in Clause 17.1 (Financial definitions).

 

Reference
Banks means, subject to
Clause 26.5 (Reference Banks), the principal London offices of JPMorgan Chase
Bank, The Toronto-Dominion Bank and CIBC World Markets plc.

 

Relevant
Convertible Preference Shares means, at any time, convertible preference shares issued by a member of
the UGCE Borrower Group but excluding convertible preference shares that cannot
in accordance with their terms be redeemed for cash:

 

(a)                                  before the date on which all amounts outstanding under
the Finance Documents and the Existing Finance Documents have been repaid or
prepaid in full; or

 

(b)                                 (if they can be redeemed for cash before that date)
until the ratio of Senior Debt to Annualised EBITDA (i) is 3.5:1 or less for
the two immediately preceding

 

30

 

consecutive Ratio Periods and (ii) will be less than 3.5:1 immediately
after such cash redemption.

 

Relevant
Eastern European Subsidiary means any Subsidiary of any Obligor which Subsidiary is incorporated and
has all its material operations in Eastern Europe, provided that the aggregate
of the contributions of the Relevant Eastern European Subsidiaries to the
consolidated total assets, consolidated revenues and consolidated EBITDA of the
Borrower Group attributable to Eastern Europe does not exceed in aggregate 10
per cent.

 

For the purposes
of this definition, consolidated revenues and consolidated EBITDA of the
Borrower Group or any Subsidiary of an Obligor shall be determined by reference
to the 12 month period ending on the most recent date in respect of which
financial statements have been delivered to the Facility Agent under Clause
16.2(b) (Financial information) and consolidated total assets shall be
determined as at such date by reference to such financial statements.

 

Relevant
Equity Injection means equity
subscribed in UPC Distribution or one or more of its Subsidiaries which is a
member of the Borrower Group (in each case other than by another member of the
Borrower Group) or the proceeds of Subordinated Shareholder Loans (including,
without limitation, the proceeds of any such equity subscription or
Subordinated Shareholder Loan which are provided to refinance any such equity
subscription or Subordinated Shareholder Loans previously provided), in each
case only to the extent that (1) such proceeds have not been repaid or prepaid
or redeemed in accordance with Clause 
(Restricted Payments) and (2) such proceeds have not been subscribed or
funded in order to fund mandatory prepayments by a Borrower pursuant to any
provision of this Agreement or any provision of the Existing Facility Agreement
under which any Borrower is required to make a mandatory prepayment of all or
part of any Advance.

 

Relevant
Event means a Default in
relation to (a) Clause 18.2 (Non-payment) or (b) Clause 17.2 (Financial
ratios).

 

Relevant
Existing Facility Repayment means:

 

(a)                                  in the case of Facility D1, the amount of Facility B
scheduled to be repaid on 31st December, 2004;

 

(b)                                 in the case of Facility D2, the amount of Facility B
scheduled to be repaid on 30th June, 2005;

 

(c)                                  in the case of Facility D3, the amount of Facility B
scheduled to be repaid on 31st December, 2005;

 

(d)                                 in the case of Facility D4, the amount of Facility B
scheduled to be repaid on 30th June, 2006;

 

(e)                                  in the case of Facility D5, the amount of Facility B
scheduled to be repaid on 31st December, 2006,

 

or in each case
if such day is not a Business Day, on the immediately preceding Business Day in
accordance with the Existing Facility.

 

Relevant
Facility B Lender means a lender
under Facility B which has entered into a Relevant Facility B Sub-participation
Agreement with a Facility D Lender as sub-participant or any other form of
sub-participation agreement in respect of its participation in Facility B

 

31

 

with a Facility
D Lender in amounts which mean that lenders under Facility B and Facility D
Lenders are in compliance with Clause 26.2(a)(ii) (Transfers by Lenders) of
this Agreement and clause 26.2(a)(ii) (Transfers by Lenders) of the Existing
Facility Agreement.

 

Relevant
Facility B Sub-participation Agreement means a sub-participation agreement substantially in the form of Part 2
of Schedule 5 entered into between a Facility D Lender as sub-participant
and a Relevant Facility B Lender in relation to one or more Relevant Repayment
Instalments (as defined in Clause 7.10 (Automatic Cancellation) in relation to
Facility D).

 

Reportable
Event means:

 

(a)                                  an event specified as such in section 4043 of
ERISA or any regulation promulgated thereunder, with respect to a Plan that is
subject to Title IV of ERISA, other than an event in relation to which the
requirement to give 30 days notice of that event is waived by any regulation;
or

 

(b)                                 a failure to meet the minimum funding standard under
section 412 of the Code or section 302 of ERISA with respect to a
Plan that is subject to such sections of the Code and ERISA, whether or not
there has been any waiver of notice or waiver of the minimum funding standard
under section 412 of the Code.

 

Request
means a request made by a Borrower to utilise
any of the Facilities and, subject to Clause 5.2 (Form of Request),
substantially in the form of Part 1 of Schedule 4 (Form of Request).

 

Requested
Amount means the amount
requested in a Request.

 

Restricted
Payment has the meaning given
to it in Clause 16.13(b) (Restricted Payments).

 

Restricted
Person means UGCE Inc., UPC,
Belmarken, UPC Holding, any other company (not being a member of the Borrower
Group) which is a Subsidiary of, or an Associated Company of, UGCE Inc. (other
than Associated Companies of UGCE Inc. which are its Associated Companies by
virtue of controlling UGCE Inc. or owning beneficially and/or legally directly
or indirectly 10 per cent. or more of the equity interests in UGCE Inc.).

 

Restricted
Person’s Framework Agreement means the Framework Agreement as defined in any Pledge of Subordinated
Shareholder Loans.

 

Restructuring
means the transfer of share capital and
intercompany receivables that took place prior to the Signing Date so that the
Borrower Group was restructured to consist of UPC Distribution and its
Subsidiaries as described in the structure chart set out at Schedule 8
(Borrower Group Structure).

 

Sale
and Purchase Agreements means the
following sale and purchase agreements relating to the sale and transfer of
shares and receivables entered into on 9th April, 2003 between:

 

(a)                                  UPC, Belmarken, UPC Holding, UPC Distribution and UPC
Operations B.V.;

 

(b)                                 UPC, Belmarken, UPC Holding and UPC Services B.V.;

 

(c)                                  UPC, Belmarken, UPC Holding, UPC Distribution and UPC
Holding Services B.V.; and

 

32

 

(d)                                 UPC, Belmarken, UPC Holding, UPC Distribution and UPC
Services Ltd.

 

Screen
Rate means:

 

(a)                                  in relation to LIBOR, the British Bankers Association
Interest Settlement Rate for the relevant currency and period; and

 

(b)                                 in relation to EURIBOR, the percentage rate per annum
determined by the Banking Federation of the European Union for the relevant
period,

 

displayed on the
appropriate page of the Reuters screen. 
If that page is replaced or the service ceases to be available, the
Facility Agent may specify another page or service displaying the appropriate
rate after consultation with UPC Distribution and the Lenders.

 

Security
Deed means the Security Deed
to be entered into between, among others, each Obligor, the Facility Agent, the
Security Agent, the Lenders, the High Yield Hedging Banks and each Subordinated
Creditor and includes each Deed of Accession (as defined in the Security Deed)
entered into in relation to the Security Deed.

 

Security
Documents means:

 

(a)                                  the documents listed in Schedule 7 (Security
Documents); and

 

(b)                                 such other security documents as may from time to time
be entered into in favour of any Beneficiary pursuant to any of the Finance
Documents (including without limitation any other Obligor Pledge of Shareholder
Loans or Pledge of Subordinated Shareholder Loans, any security document
referred to in Clause 16.23 (UPC Distribution Pledged Account), Clause 16.24
(Share security) or Clause 16.26 (Further security over receivables) and any
security document provided to the Security Agent in connection with the
accession of an Additional Obligor pursuant to Clause 26.4 (Additional
Obligors) and Part 2 of Schedule 2 (Conditions Precedent Documents) or
otherwise.

 

Security
Interest means any mortgage,
charge (whether fixed or floating), pledge, lien, hypothecation, assignment by
way of security, trust arrangement for the purpose of providing security or
other security interest of any kind securing any obligation of any person or
any other arrangement having the effect of conferring rights of retention or
other disposal rights over an asset (including without limitation title
transfer and/or retention arrangements having a similar effect or a deposit of
money with the primary intention of affording a right of set-off) and includes any
agreement to create any of the foregoing but does not include (a) liens arising
in the ordinary course of business by operation of law and not by way of
contract and (b) any grant of indefeasible rights of use or equivalent
arrangements with respect to network capacity, communications, fibre capacity
or conduit.

 

Security
Provider’s Deed of Accession has the meaning given to it in the Security Deed.

 

Senior
Beneficiary has the meaning given
to the term in the Security Deed.

 

Senior
Debt has the meaning given
to it in Clause 17.1 (Financial definitions).

 

Senior
Hedging Agreements means any and
all interest rate and/or currency swap and/or interest rate and/or currency cap
and/or other interest rate and/or currency hedging agreements entered into or
to be entered into by any member of the Borrower Group with any of the Senior
Hedging Banks from time to time in relation to the Borrower Group’s floating
rate 

 

33

 

interest
exposure and/or currency exposure and for the avoidance of doubt shall include,
without limitation, the hedging arrangements entered into between UPC
Distribution and Bank of America, N.A. and the hedging arrangements entered
into between UPC Distribution and JP Morgan Chase Bank, each as described in
schedules 1 and 2 respectively of the letter dated 20th December, 2002 between
the Existing Facility Agent on behalf of the Majority Lenders under the
Existing Facility and UPC Distribution.

 

Serviceable
Subordinated Debt means any
Financial Indebtedness not prohibited by the Finance Documents or the Existing
Finance Documents (including, for the avoidance of doubt, High Yield Notes and
Relevant Convertible Preference Shares) which is raised by an entity that is
not a member of the Borrower Group, all or part of, the proceeds of which are
on-lent directly or indirectly to a member of the Borrower Group by a
Subordinated Creditor by means of a Subordinated Shareholder Loan provided
that, all or part of, such proceeds are applied in permanent prepayment and
cancellation of the Facilities in accordance with this Agreement or of the
Existing Facility in accordance with the Existing Facility Agreement.

 

Shareholder
means UGCE Inc. or a Subsidiary (as defined in
any relevant Indenture) of UGCE Inc.

 

Shareholders’
Agreements means the agreements
listed in Schedule 9 (Shareholders’ Agreements).

 

Signing
Date means the date of this
Agreement.

 

Sterling
means the lawful currency for the time being of
the United Kingdom.

 

Subordinated
Creditor means any Restricted
Person who has, at any relevant time, entered into a Pledge of Subordinated
Shareholder Loans and the Security Deed or a Security Provider’s Deed of
Accession.

 

Subordinated
Shareholder Loans means any
Financial Indebtedness of any member of the Borrower Group owed to a
Subordinated Creditor.

 

Subsidiary
of a person means any company or entity
directly or indirectly controlled by such person, for which purpose control means ownership of more than 50 per
cent. of the economic and/or voting share capital (or equivalent right of
ownership of such company or entity).

 

Target
means any assets or entity which is or are the
subject of an Acquisition or Additional Acquisition (as applicable) in
accordance with the terms of this Agreement.

 

TARGET
Day means a day on which
the Trans-European Automated Real-Time Gross Settlement (TARGET) System is
operating.

 

Taxes or Tax means
all present and future taxes, imposts, duties, levies, fees or charges of a
similar nature, together with interest thereon and penalties in respect
thereof.

 

Telecommunications
and Cable Law means all laws,
statutes, regulations and judgments relating to telecommunications, cable
television and data services applicable to any member of the Borrower Group
and/or the business carried on by any member of the Borrower Group in any
jurisdiction in which a member of the Borrower Group is incorporated or formed
or in which such member has its principal place of business or owns any
material assets.

 

34

 

Telekabel
Wien means Telekabel Wien
GmbH a company incorporated under the laws of Austria with its corporate seat
at Erlachgasse 116, 1100 Wien, Austria and with registration number FN 84116a.

 

Third
Party Debt means any Financial
Indebtedness which is owed to any person other than a member of the Wider Group
(but, for the avoidance of doubt, excluding any indebtedness arising under any
instrument that does not impose any obligations on the obligor to make any cash
payment and does not permit such obligor to elect to make any cash payments and
to the extent only that such instrument is not amended so as to become an
instrument under which there are (or may be) cash payment obligations).

 

Total
Additional Facility Commitments means in relation to an Additional Facility, the aggregate for the time
being of the Additional Facility Commitments for that Additional Facility.

 

Total
Cash Interest has the meaning
given to it in Clause 17.1 (Financial definitions).

 

Total
Debt has the meaning given
to it in Clause 17.1 (Financial definitions).

 

Total
Commitments means the aggregate
for the time being of the Total Facility D1 Commitments, Total Facility D2
Commitments, Total Facility D3 Commitments, Total Facility D4 Commitments,
Total Facility D5 Commitments and the aggregate Total Additional Facility
Commitments for all Additional Facilities.

 

Total
Facility D Commitments means the
aggregate for the time being of the Total Facility D1 Commitments, Total
Facility D2 Commitments, Total Facility D3 Commitments, Total Facility D4
Commitments and Total Facility D5 Commitments

 

Total
Facility D1 Commitments means the
aggregate for the time being of the Facility D1 Commitments, being €109,371,094 on the Signing Date.

 

Total
Facility D2 Commitments means the
aggregate for the time being of the Facility D2 Commitments, being €196,867,969 on the Signing Date.

 

Total
Facility D3 Commitments means the
aggregate for the time being of the Facility D3 Commitments, being €196,867,969 on the Signing Date.

 

Total
Facility D4 Commitments means the
aggregate for the time being of the Facility D4 Commitments, being €284,364,844 on the Signing Date.

 

Total
Facility D5 Commitments means the
aggregate for the time being of the Facility D5 Commitments, being €284,364,844 on the Signing Date.

 

UGC
means UnitedGlobalCom, Inc. a corporation
incorporated in the State of Delaware, United States and, as of the Signing
Date, having its business office at 4643 South Ulster Street, Suite 1300,
Denver, Colorado 80237 U.S.A.

 

UGCE
Borrower Group means:

 

(a)                                  UGCE Inc.;

 

(b)                                 any other company of which UPC Distribution is a
Subsidiary and which is a Subsidiary of UGCE Inc.; and

 

35

 

(c)                                  UPC Holding II.

 

UGCE
Inc. means:

 

(a)                                  UGC Europe Inc. a company organised under the laws of
the State of Delaware with its principal place of business at Boeing Avenue 53,
1119 PE Schiphol Rijk, Amsterdam, The Netherlands; and

 

(b)                                 if the entity referred to in (a) above:

 

(i)                                     consolidates with or merges with any other person or
persons; or

 

(ii)                                  directly or indirectly, sells, leases, conveys or
transfers all or substantially all of its assets to any other person or
persons,

 

the successor person
formed by such consolidation or into which such entity is merged or to which
such conveyance, transfer or lease is made.

 

United
States or US means the United States of America.

 

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

 

Unrestricted
Cash has the meaning given
to that term under GAAP.

 

Unrestricted
Subsidiary means each Subsidiary
of UPC Distribution and, prior to the Restructuring, each Subsidiary of each
Obligor that is not a Subsidiary of UPC Distribution, the acquisition cost of
which and whose on-going funding requirements are not funded directly or
indirectly (in whole or in part) by any member of the Borrower Group by way of
drawings under the Facilities and which is designated by UPC Distribution in
writing as an Unrestricted Subsidiary.

 

UPC
means United Pan-Europe Communications N.V., a
public limited liability company incorporated under the laws of The Netherlands
and, as of the Signing Date, with its registered office at Amsterdam and its
business office at  Boeing Avenue 53,
1119 PE Schiphol Rijk, Amsterdam, The Netherlands.

 

UPC
Distribution Holdco means the
immediate Holding Company of UPC Distribution from time to time, being UPC
Holding as of the Signing Date.

 

UPC
Distribution Pledged Account has the meaning given in Clause 16.23(b) (UPC Distribution Pledged
Account).

 

UPC
Financing means UPC Financing
Partnership, a general partnership formed under the laws of Delaware, United
States with its principal place of business at 4643 South Ulster Street, Suit
1300, Denver, Colorado 80237, USA.

 

UPC
Holding means UPC Holding B.V.,
a limited liability company incorporated under the laws of The Netherlands and,
as of the Signing Date, with its registered office at Amsterdam and its
business office at Boeing Avenue 53, 1119 PE Schiphol Rijk, Amsterdam, The
Netherlands.

 

UPC
Holding II means UPC Holding II
B.V., a limited liability company incorporated under the laws of The
Netherlands and, as of the Signing Date, with its registered office at

 

36

 

Amsterdam and
its business office at Boeing Avenue 53, 1119 PE Schiphol Rijk, Amsterdam, The
Netherlands.

 

UPC
Polska means:

 

(a)                                  UPC Polska, Inc.; and

 

(b)                                 if the entity referred to in (a) above:

 

(i)                                     consolidates with or merges with or is acquired by any
other person or persons; or

 

(ii)                                  directly or indirectly, sells, leases, conveys or
transfers all or substantially all of its assets to any other person or
persons,

 

the successor
person (including any Holding Company which holds all the shares of UPC Polska)
formed by such consolidation or into which such entity is merged or to which
such conveyance, transfer or lease is made.

 

UPC
Polska Acquisition means the
Majority Acquisition by a member of the Borrower Group of all or any part of
the share capital or assets of UPC Polska.

 

UPC
Polska  Restructuring means the proposed financial
restructuring relating to UPC Polska as particularly described in the First
Amended Disclosure Statement dated 27th October, 2003, pursuant to which UPC
Polska intends to restructure its capital structure and effectuate an overall
compromise and settlement with certain parties and co-issue notes, stock and
distribute cash in consideration for the transfer of claims outstanding under
certain notes.

 

US
Borrower means any Additional
Borrower under this Agreement which is incorporated or formed under the laws of
a State of the United States or that resides or has a domicile, a place of
business or property in the United States.

 

US
Dollars and US$ means the lawful currency for the time
being of the United States.

 

US
Obligor has the meaning given
to it in Clause 18.6(c) (Insolvency).

 

Utilisation
Date means:

 

(a)                                  in the case of Facility D1, 31st December, 2004;

 

(b)                                 in the case of Facility D2, 30th June, 2005;

 

(c)                                  in the case of Facility D3, 31st December, 2005;

 

(d)                                 in the case of Facility D4, 30th June, 2006;

 

(e)                                  in the case of Facility D5, 31st December, 2006; and

 

(f)                                    in the case of an Advance under an Additional
Facility, the date specified as such in the relevant Request or, on and after
the making and/or issue thereof pursuant to such Request, the date on which it
was made and/or issued,

 

or, in the case
of each Facility D, if such day listed above is not a Business Day, the immediately
preceding Business Day.

 

37

 

VAT
means value added or similar tax.

 

Verification
Letter means a letter
substantially in the form of Part 6 of Schedule 5 (Form of Verification
Letter).

 

Western
Europe means the countries
that comprise the European Community as at the Effective Date, Scandinavia and
Switzerland.

 

Wider
Group means UGCE Inc. and
each of its Affiliates including (for the avoidance of doubt) UGC and Liberty
Media Corporation or any of their respective Subsidiaries.

 

1.2                               Construction

 

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

 

(i)                                     a document being in the agreed form means a document (A) in a form previously agreed
in writing by or on behalf of the Facility Agent and UPC Distribution, or (B)
in a form substantially as set out in any Schedule to any Finance
Document, or (C) (if not falling within (A) or (B) above) in form and substance
satisfactory to the Lenders and initialled by or on behalf of the Facility
Agent and UPC Distribution for the purposes of identification;

 

amendment includes a supplement, novation or re-enactment and amended is to be construed accordingly;

 

assets includes all or any part of any business,
undertaking, real property, personal property, uncalled capital and any rights
(whether actual or contingent, present or future) to receive, or require
delivery of, any of the foregoing;

 

references to
the equivalent of an amount
specified in a particular currency (the specified
currency amount) shall be construed as a reference to the amount of
the other relevant currency which can be purchased with the specified currency
amount in the London foreign exchange market at or about 11.00 a.m. on the day
on which the calculation falls to be made for spot delivery as determined by
the Facility Agent in accordance with its customary practices;

 

European
interbank market means the
interbank market for euro operating in Participating Member States;

 

a guarantee includes a reference to an
indemnity or other assurance against financial loss including, without
limitation, an obligation to purchase assets or services as a consequence of a
default by any other person to pay any indebtedness and guaranteed shall be construed accordingly;

 

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

 

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;

 

38

 

permanent
prepayment and cancellation means, in relation to any facility, a permanent prepayment of
outstanding advances under that facility with a corresponding permanent
cancellation of the total commitments in relation to that facility;

 

a person includes any individual, firm,
company, corporation, unincorporated body of persons or any state or any of its
agencies;

 

a regulation includes any present or future
regulation, rule, directive, requirement, request or guideline (whether or not
having the force of law but, if not having the force of law, only if compliance
therewith is in accordance with the general practice of the relevant persons to
whom it is intended to apply or, in the case of Clause 12 (Increased Costs)
only, the relevant Finance Party or its Holding Company) of any agency,
authority, central bank or government department or any self-regulatory or
other national or supra-national authority;

 

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

 

(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)                                 (or to any specified provision of) this Agreement or
any other document shall be construed, save where expressly provided to the
contrary in this Agreement, as a reference to this Agreement, that provision or
that document as in force for the time being and as from time to time amended
in accordance with its terms, or, as the case may be, with the agreement of the
relevant parties and (where such consent is, by the terms of this Agreement or
the relevant document, required to be obtained as a condition to such amendment
being permitted) the prior written consent of the Facility Agent, all of the Lenders
or the Majority Lenders (as the case may be);

 

(vi)                              other than in the definition of “EURIBOR” in Clause
1.1 (Definitions), a time of day is a reference to London time; and

 

(vii)                           words importing the plural include the singular and
vice versa.

 

(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)                                  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.

 

39

 

1.3                               Existing Facility Agents

 

The Existing
Facility Agents are entering into this Agreement only for the purposes of
giving the confirmation in Clause 5.5 (Relationship between Facility D and
Existing Facility).

 

1.4                               Existing Facility Agreement

 

(a)                                  Unless expressly stated to the contrary, and subject
to paragraph (b), references in any of the Finance Documents to the Existing
Finance Documents and to terms defined in, and provisions of, any of the
Existing Finance Documents, shall be references to the relevant Existing
Finance Document and such terms and provisions as at the Effective Date, as the
same may be amended with the prior written approval of the Facility Agent
(acting on the instructions of the Majority Lenders) from time to time.

 

(b)                                 References in any of the Finance Documents to any
Finance Party (as defined in the Existing Facility Agreement) shall include
such Finance Party’s permitted successors, transferees or assigns from time to
time.

 

2.                                      THE
FACILITIES

 

2.1                               Facility D

 

The relevant
Facility D Lenders grant to UPC Distribution:

 

(a)                                  a committed €109,371,094 term loan facility under
which the relevant Lenders will, when requested by UPC Distribution, make cash
advances in euros to UPC Distribution on the Utilisation Date for Facility D1;

 

(b)                                 a committed €196,867,969 term loan facility under
which the relevant Lenders will, when requested by UPC Distribution, make cash
advances in euros to UPC Distribution on the Utilisation Date for Facility D2;

 

(c)                                  a committed €196,867,969 term loan facility under
which the relevant Lenders will, when requested by UPC Distribution, make cash
advances in euros to UPC Distribution on the Utilisation Date for Facility D3;

 

(d)                                 a committed €284,364,844 term loan facility under
which the relevant Lenders will, when requested by UPC Distribution, make cash
advances in euros to UPC Distribution on the Utilisation Date for Facility D4;
and

 

(e)                                  a committed €284,364,844 term loan facility under
which the relevant Lenders will, when requested by UPC Distribution, make cash
advances in euros to UPC Distribution on the Utilisation Date for Facility D5,

 

in each case
subject to the terms of this Agreement.

 

2.2                               Additional Facilities

 

(a)                                  Any person may, subject to the terms of this
Agreement, become an Additional Facility Lender by delivering to the Facility
Agent an Additional Facility Accession Agreement and, if the Borrower under the
relevant Additional Facility is an entity incorporated in The Netherlands, a
Verification Letter, in each case duly completed and executed by that person,
UPC Distribution and, if the Additional Facility is to be granted to an
Additional Borrower,

 

40

 

the relevant Additional
Borrower.  That person shall become an
Additional Facility Lender on the date specified in the Additional Facility
Accession Agreement.

 

(b)                                 Upon the relevant person becoming an Additional
Facility Lender, the Total Commitments shall be increased by the amount set out
in the relevant Additional Facility Accession Agreement as that Additional
Facility Lender’s Commitment.

 

(c)                                  Each Additional Facility Lender will grant to the
relevant Borrower a term loan facility in the amount specified in the relevant
Additional Facility Accession Agreement in euros or US Dollars (as applicable)
during the Additional Facility Availability Period specified in the Additional
Facility Accession Agreement, subject to the terms of this Agreement.

 

(d)                                 The execution by UPC Distribution and the relevant
Borrower of an Additional Facility Accession Agreement constitutes confirmation
by each Guarantor that its obligations under Clause 14 (Guarantee) shall
continue unaffected except that those obligations shall extend to the Total
Commitments as increased by the addition of the relevant Additional Facility
Lender’s Commitment and shall be owed to each Finance Party including the
relevant Additional Facility Lender.

 

2.3                               Overall facility limits

 

(a)                                  The aggregate amount of all outstanding Facility D1
Advances shall not at any time exceed the Total Facility D1 Commitments.

 

(b)                                 The aggregate amount of all outstanding Facility D2
Advances shall not at any time exceed the Total Facility D2 Commitments.

 

(c)                                  The aggregate amount of all outstanding Facility D3
Advances shall not at any time exceed the Total Facility D3 Commitments;

 

(d)                                 The aggregate amount of all outstanding Facility D4
Advances shall not at any time exceed the Total Facility D4 Commitments.

 

(e)                                  The aggregate amount of all outstanding Facility D5
Advances shall not at any time exceed the Total Facility D5 Commitments.

 

(f)                                    The aggregate Original Euro Amount of all outstanding
Additional Facility Advances under an Additional Facility shall not at any time
exceed the Total Additional Facility Commitments for that Additional Facility.

 

(g)                                 The aggregate amount of:

 

(i)                                     the participations of a Lender in Facility D1 Advances
shall not at any time exceed that Lender’s Facility D1 Commitment at that time;

 

(ii)                                  the participations of a Lender in Facility D2 Advances
shall not at any time exceed that Lender’s Facility D2 Commitment at that time;

 

(iii)                               the participations of a Lender in Facility D3 Advances
shall not at any time exceed that Lender’s Facility D3 Commitment at that time;

 

(iv)                              the participations of a Lender in Facility D4 Advances
shall not at any time exceed that Lender’s Facility D4 Commitment at that time;
and

 

41

 

(v)                                 the participations of a Lender in Facility D5 Advances
shall not at any time exceed that Lender’s Facility D5 Commitment at that time.

 

(h)                                 The aggregate Original Euro Amount of the
participations of a Lender in Additional Facility Advances under an Additional
Facility shall not at any time exceed that Lender’s Additional Facility
Commitment for that Additional Facility at that time.

 

2.4                               Number of Requests and Advances

 

(a)                                  No more than one Request for an Advance may be made
for each of the Facility D1 Advance, Facility D2 Advance, Facility D3 Advance,
Facility D4 Advance or Facility D5 Advance under this Agreement.

 

(b)                                 No more than one Request may be made for each
Additional Facility Advance under this Agreement.

 

(c)                                  No more than five Advances may be outstanding at any
one time under Facility D and no more than five Advances may be outstanding at
any time under each Additional Facility.

 

2.5                               Nature of a Finance Party’s rights
and obligations

 

(a)                                  The obligations of a Finance Party under the Finance
Documents are several.  Failure of a
Finance Party to carry out those obligations does not relieve any other Party
of its obligations under the Finance Documents.  No Finance Party is responsible for the obligations of any other
Finance Party under the Finance Documents.

 

(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.

 

(c)                                  Each of the Obligors and each of the Finance Parties
agrees that the Security Agent shall be the joint and several creditor (hoofdelijk crediteur) of each and every
obligation of any Obligor towards each of the Finance Parties under any Finance
Document, and that accordingly the Security Agent will have its own independent
claim as creditor and not as agent against each Obligor to demand performance
by the relevant Obligor of those obligations. 
However, any discharge of any such obligation to either of the Security
Agent or the relevant Finance Party shall, to the same extent, discharge the
corresponding obligation owing to the other.

 

(d)                                 Without limiting or affecting the Security Agent’s
rights against any Obligor (whether under this paragraph or under any other
provision of the Finance Documents), the Security Agent agrees with each other
Finance Party (on a several and divided basis) that, subject as set out in the
next sentence, it will not exercise its rights as a joint and several creditor
with a Finance Party except with the prior written consent of the relevant
Finance Party.  However, for the
avoidance of doubt, nothing in the previous sentence shall in any way limit the
Agent’s right to act in the protection or preservation of rights under or to
enforce any Security Document or the Security Deed as contemplated by the
Finance Documents (or to do any act reasonably incidental to any of the
foregoing).

 

2.6                               UPC Distribution as Obligors’ agent

 

Each Obligor:

 

42

 

(a)                                  irrevocably authorises and instructs UPC Distribution
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
UPC Distribution under or in connection with the Finance Documents.

 

2.7                               Actions of UPC Distribution 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 UPC Distribution;

 

(b)                                 UPC Distribution 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 UPC Distribution to inform any Obligor of receipt by it
of any notification under this Agreement or any other Finance Document.

 

2.8                               Additional Facility D Lenders

 

(a)                                  Any Facility B Lender (as defined in the Existing
Facility Agreement) may, subject to the terms of this Agreement, become an
Additional Facility D Lender by delivering to the Facility Agent an Additional
Facility D Lender Accession Agreement and a Verification Letter, in each case
duly completed and executed by that Additional Facility D Lender and UPC
Distribution on or before the day falling four Business Days after the Signing
Date.  That Additional Facility D Lender
will become an Additional Facility D Lender on the date falling five Business
Days after the Signing Date.

 

(b)                                 If, at 9.30am (London time) on the Allocation Date,
the sum of the Facility D Commitments of each Initial Facility D Lender set out
opposite its name in Part 2 of Schedule 1 (Initial Facility D Lenders and
Commitments) and the Facility D Commitments of each Additional Facility D
Lender (as set out in each of the Additional Facility D Lender Accession
Agreements) exceed €1,072,000,000, the Facility Agent shall, on the Allocation
Date, reduce the Commitments of each Initial Facility D Lender and each
Additional Facility D Lender pro rata so that the Total Facility D Commitments
are €1,072,000,000 provided that in no circumstances shall:

 

(i)                                    the Facility D Commitments of any Initial Facility D
Lender exceed the amount set out opposite its name in Part 2 of Schedule 1
(Facility D Commitments);

 

(ii)                                 the Facility D Commitment of any Additional Facility D
Lender exceed the amount set out in the relevant Additional Facility D Lender
Accession Agreement.

 

(c)                                  Promptly after the allocation in accordance with
Clause 2.8(c) above, the Facility Agent shall amend this Agreement by completing
Part 3 of Schedule 1 (Facility D Commitments) to set out the Facility D
Commitments of each Facility D Lender as reduced in accordance with this
Clause.

 

43

 

(d)                                 Each Additional Facility D Lender shall participate in
each Facility D Advance in accordance with Clause 5.4 (Participations in
Advances).

 

(e)                                  The execution by UPC Distribution of an Additional
Facility D Lender Accession Agreement constitutes confirmation by each
Guarantor that its obligations under Clause 14 (Guarantee) shall continue
unaffected except that those obligations shall be owed to each Finance Party
including the relevant Additional Facility D Lender.

 

3.                                      PURPOSE

 

3.1                               Purpose

 

Each Advance
will be applied:

 

(a)                                  in the case of Facility D1, to finance (in part) the
scheduled repayment of the Relevant Existing Facility Repayment;

 

(b)                                 in the case of Facility D2, to finance (in part) the
scheduled repayment of the Relevant Existing Facility Repayment;

 

(c)                                  in the case of Facility D3, to finance (in part) the
scheduled repayment of the Relevant Existing Facility Repayment;

 

(d)                                 in the case of Facility D4, to finance (in part) the
scheduled repayment of the Relevant Existing Facility Repayment;

 

(e)                                  in the case of Facility D5, to finance (in part) the
scheduled repayment of the Relevant Existing Facility Repayment; and

 

(f)                                    in the case of each Additional Facility:

 

(i)                                     to finance (in whole or in part) an Additional
Permitted Acquisition; and/or

 

(ii)                                  in permanent prepayment and cancellation of the
Existing Facility in accordance with clause 7.3 (Voluntary Prepayments) of the
Existing Facility Agreement and/or Facility D in accordance with Clause
7.3(b)(i) (Voluntary Prepayment).

 

3.2                               No monitoring

 

Without
affecting the obligations of the Borrowers 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                               Documentary conditions precedent

 

(a)                                  This Agreement will take effect on the day falling no
less than five Business Days after the Signing Date (the Effective Date) on which the Facility Agent
notifies UPC Distribution and the Lenders that it has received written
confirmation from the Existing Facility Agents that the conditions precedent in
Clause 2(b) of the amendment and restatement agreement dated on or about the
date of this Agreement between, inter alia,
UPC Distribution and the Existing Facility Agents amending and restating the
Existing Facility Agreement have been either satisfied or waived and that such
agreement is effective.

 

44

 

(b)                                 No Borrower may draw an Advance under this Agreement
until the Facility Agent has notified UPC Distribution and the Lenders that it
has received all of the documents set out in Part 1 of 0 (Conditions Precedent
Documents) in form and substance satisfactory to the Facility Agent.

 

(c)                                  The Facility Agent will confirm to UPC Distribution
and to the Existing Facility Agents that it has received the documents referred
to in paragraph (b) above as soon as practicable upon receiving all of them in
form and substance satisfactory to it.

 

4.2                               Further conditions precedent

 

(a)                                  The obligations of each Lender in respect of each
Facility D Advance are subject to the further conditions precedent that:

 

(i)                                     on the date of the Request for that Facility D Advance
and on the proposed Utilisation Date, UPC Distribution confirms to the Facility
Agent in the Request that the proceeds of such Advance are only to be applied
in accordance with Clause 3.1 (Purpose) and specifies the relevant purpose of
the proposed Advance in such Request; and

 

(ii)                                  on the date of the Request, UPC Distribution has paid
to the Facility Agent under and in accordance with the Existing Facility, for
application in repayment of the Relevant Existing Facility Repayment on the
next Repayment Date for Facility B (as defined in the Existing Facility
Agreement) an amount not less than the difference between:

 

(A)                              in the case of Facility D1 , the Relevant Existing
Facility Repayment and the Total Facility D1 Commitments;

 

(B)                                in the case of Facility D2, the Relevant Existing
Facility Repayment and the Total Facility D2 Commitments;

 

(C)                                in the case of Facility D3, the Relevant Existing
Facility Repayment and the Total Facility D3 Commitments;

 

(D)                               in the case of Facility D4, the Relevant Existing
Facility Repayment and the Total Facility D4 Commitments; and

 

(E)                                 in the case of Facility D5, the Relevant Existing
Facility Repayment and the Total Facility D5 Commitments.

 

(b)                                 The obligations of each Lender in respect of each
Additional Facility Advance are subject to the further conditions precedent
that:

 

(i)                                     on the date of the Request for that Additional
Facility Advance and on the proposed Utilisation Date the representations and
warranties in Clause 15 (Representations and Warranties) to be repeated on
those dates are and will be immediately after the relevant Additional Facility
Advance is drawn down correct in all material respects;

 

(ii)                                  on the date of the Request for that Additional
Facility Advance and on the proposed Utilisation Date no Default is outstanding
or would result from the proposed Additional Facility Advance;

 

45

 

(iii)                               on the date of the Request for that Additional Facility
Advance and on the proposed Utilisation Date no Change of Control has occurred
where the event has not been waived by the Majority Lenders; and

 

(iv)                              the relevant Borrower confirms to the Facility Agent
in the Request that the proceeds of such Additional Facility Advance are only
to be applied in accordance with Clause 3.1 (Purpose) and specifies the
relevant purpose of the proposed Additional Facility Advance in such Request.

 

4.3                               Pro forma covenant compliance

 

No Borrower may
Request or obtain any Additional Facility Advance in an amount which, when
aggregated with all other Advances (and all Advances (other than Rollover
Advances) (in each case as defined in the Existing Facility Agreement)) (the Relevant Advances) made since the last day
of the most recent Ratio Period ending prior to the proposed date of that
Additional Facility Advance for which financial statements have been delivered
pursuant to Clause 4.1 (Documentary conditions precedent) or Clause 16.2(a) or
(b) (Financial information) (the Relevant
Ratio Period) would cause UPC Distribution to fail to be in
compliance with the financial ratios set out in Clause 17.2 (Financial ratios)
for the Relevant Ratio Period, if such financial ratios were re-tested for the
Relevant Ratio Period after adding the aggregate amount of all such Relevant
Advances to the amount of Senior Debt and Total Debt used in calculating such
ratios.

 

4.4                               Deferred Acquisition Costs

 

Where a member
of the Borrower Group has made an Acquisition permitted by Clause  16.11 (Acquisitions and mergers), no
Borrower may Request, or apply the proceeds of, any Advance for the purpose of
paying any consideration referred to in paragraph (a) of the definition of
“Acquisition Cost” in relation to that Acquisition, unless UPC Distribution
delivers to the Facility Agent on or before the date of each relevant Request:

 

(a)                                  where the Acquisition Cost of the acquisition was
greater than €100,000,000 and no more than €150,000,000, a certificate signed
by two managing directors or the sole managing director, as the case may be, of
UPC Distribution and certifying; or

 

(b)                                 where the Acquisition Cost of the acquisition was
greater than €150,000,000, financial projections based on assumptions which are
no more aggressive (when taken as a whole) than those used in the preparation
of the Business Plan which demonstrate,

 

that the
Borrowers will be in compliance with Clause 6 (Repayment) and the undertakings
set out in Clause 17 (Financial Covenants) for the period from the Utilisation
Date of such Advance (taking into account (i) the Acquisition Cost of such
acquisition (but deducting from that Acquisition Cost the value of any
consideration referred to in paragraph (a) of the definition of “Acquisition
Cost” which has yet to be paid or delivered), (ii) the amount of such Advance
and (iii) financial projections relating to the acquired business or asset(s))
to the Final Maturity Date.

 

46

 

5.                                      ADVANCES

 

5.1                               Delivery of Request

 

Subject to the
terms of this Agreement, a Borrower may request an Advance by delivering to the
Facility Agent by not later than 11.00 a.m. on the third Business Day, before
the Utilisation Date, a duly completed Request.

 

5.2                               Form of Request

 

Each Request
shall specify (where applicable):

 

(a)                                  the relevant Facility and the corresponding
Utilisation Date which, in the case of an Additional Facility Advance, shall be
a Business Day falling during the relevant Additional Facility Availability
Period;

 

(b)                                 in the case of an Additional Facility Advance the
currency of the proposed Advance (which must be euros or US Dollars);

 

(c)                                  the principal amount of the proposed Advance which:

 

(i)                                     for an Advance denominated in euros, shall be a
minimum amount of €10,000,000; and

 

(ii)                                  for an Advance denominated in US Dollars, shall be a
minimum amount of US$10,000,000;

 

(d)                                 the Interest Period of the Advance, which must be a
period complying with Clause 8 (Interest); and

 

(e)                                  unless previously notified to the Facility Agent in
writing and not revoked, or unless Clause 5.5 (Relationship between Facility D
and Existing Facility) applies to the entire amount of the Advance, the details
of the bank and account to which the proceeds of the proposed Advance are to be
made available, which must comply with Clause 9 (Payments).

 

Subject to the
terms of this Agreement, each Request shall be irrevocable and the relevant
Borrower shall be bound to borrow an Advance in accordance with such Request.

 

5.3                               Notification to the Lenders

 

The Facility
Agent shall promptly notify each Lender participating in the relevant Advance
of each Request for an Advance and the amount of its participation in the
Advance.

 

5.4                               Participations in Advances

 

(a)                                  Subject to the terms of this Agreement, each Lender
shall, on the date specified in any Request for an Advance, make available to
the Facility Agent for the account of the relevant Borrower the amount of its
participation in that Advance.  All such
amounts shall be made available to the Facility Agent in accordance with Clause
9.2 (Funds) for disbursement to or to the order of the relevant Borrower in
accordance with the provisions of this Agreement.

 

(b)                                 The amount of a Lender’s participation in an Advance
will be the proportion (applied to the amount set out in the Request) which:

 

47

 

(i)                                     in the case of a Facility D1 Advance, its Facility D1
Commitment bears to the Total Facility D1 Commitments;

 

(ii)                                  in the case of a Facility D2 Advance, its Facility D2
Commitment bears to the Total Facility D2 Commitments;

 

(iii)                               in the case of a Facility D3 Advance, its Facility D3
Commitment bears to the Total Facility D3 Commitments;

 

(iv)                              in the case of a Facility D4 Advance, its Facility D4
Commitment bears to the Total Facility D4 Commitments;

 

(v)                                 in the case of a Facility D5 Advance, its Facility D5
Commitment bears to the Total Facility D5 Commitments; and

 

(vi)                              in the case of an Additional Facility Advance, its
relevant Additional Facility Commitment bears to the relevant Total Additional
Facility Commitments.

 

(c)                                  If an Advance is to be drawn down in US Dollars, the
amount of each Lender’s participation in that Advance will be determined by
converting into US Dollars the Lender’s participation in the Original Euro
Amount of that Advance on the basis of the Agent’s Spot Rate of Exchange three
Business Days before its Utilisation Date.

 

(d)                                 Advances denominated in euro will only be made available
in the euro unit.

 

5.5                               Relationship between Facility D and
Existing Facility

 

In relation to
each Facility D Advance to be made under this Agreement, the Obligors, the
Facility Agent and the Existing Facility Agents confirm that, to the extent
that:

 

(a)                                  an amount is due to be paid to a Facility D Lender
under clause 6.2 (Repayment of Facility B Advances) of the Existing Facility or
under a sub-participation agreement (including a Relevant Facility B
Sub-participation Agreement) on or about the proposed Utilisation Date; and

 

(b)                                 that amount is not less than the amount of the
Facility D1 Commitment, Facility D2 Commitment, Facility D3 Commitment,
Facility D4 Commitment or Facility D5 Commitment (as applicable) of that
Facility D Lender on the relevant Utilisation Date or (if less) the amount
which that Facility D Lender is obliged to participate in such Facility D
Advance on such Utilisation Date (such amount being the Deemed Drawn Amount),

 

the Deemed Drawn
Amount shall, at the time that such Facility D Advance is due to be made (and
provided that all conditions precedent set out in Clause 4 (Conditions
Precedent) to the making of that Facility D Advance have been satisfied on or
by that Utilisation Date), be deemed to be advanced by that Facility D Lender
to UPC Distribution under Facility D1, Facility D2, Facility D3, Facility D4 or
Facility D5 (as applicable) on the relevant Utilisation Date and UPC
Distribution’s payment obligations to that Facility D Lender or to the Relevant
Facility B Lender relating to that Facility D Lender (as applicable) under
clause 6.2 (Repayment of Facility B Advances) of the Existing Facility will be
satisfied in an amount equal to the Deemed Drawn Amount.

 

48

 

6.                                      REPAYMENT

 

6.1                               Repayment of Advances

 

(a)                                  UPC Distribution shall repay the Facility D1 Advance,
Facility D2 Advance, Facility D3 Advance, Facility D4 Advance and Facility D5
Advance in full on the Facility D Final Maturity Date.

 

(b)                                 The relevant Borrower shall repay each Additional
Facility Advance in full on the relevant Additional Facility Final Maturity
Date.

 

6.2                               Prepayments and repayments

 

If an Additional
Facility Advance is to be repaid or prepaid by reference to an Original Euro
Amount, the US Dollar amount to be repaid or prepaid shall be determined by
reference to the Agent’s Spot Rate of Exchange used for determining the US
Dollar amount of that Additional Facility Advance under Clause 5.4(c)
(Participations in Advances) or, if applicable, the Original Exchange Rate.

 

6.3                               Notification

 

The Agent shall
notify the relevant Lender(s) and UPC Distribution of US Dollar amounts (and
the applicable Agent’s Spot Rate of Exchange) promptly after they are
ascertained under this Agreement.

 

7.                                      CANCELLATION
AND PREPAYMENT

 

7.1                               Automatic Cancellation of the
Commitments

 

(a)                                  The undrawn Facility D1 Commitment of each Lender
shall be automatically cancelled at the close of business in London on the
relevant Utilisation Date.

 

(b)                                 The undrawn Facility D2 Commitment of each Lender
shall be automatically cancelled at the close of business in London on the
relevant Utilisation Date.

 

(c)                                  The undrawn Facility D3 Commitment of each Lender
shall be automatically cancelled at the close of business in London on the
relevant Utilisation Date.

 

(d)                                 The undrawn Facility D4 Commitment of each Lender
shall be automatically cancelled at the close of business in London on the
relevant Utilisation Date.

 

(e)                                  The undrawn Facility D5 Commitment of each Lender
shall be automatically cancelled at the close of business in London on the
relevant Utilisation Date.

 

(f)                                    The undrawn Additional Facility Commitment under each
Additional Facility shall be automatically cancelled at the close of Business
in London on the last day of the relevant Additional Facility Availability
Period.

 

7.2                               Voluntary cancellation

 

UPC Distribution
may, by delivering to the Facility Agent a duly completed Cancellation Notice
not less than five Business Days prior to the due date of cancellation, cancel
the unutilised portion of the Total Facility D1 Commitments and/or Total
Facility D2 Commitments and/or Total Facility D3 Commitments and/or Total
Facility D4 Commitments

 

49

 

and/or Total
Facility D5 Commitments and/or Total Additional Facility Commitments in whole
or in part (but, if in part, in an aggregate minimum Original Euro Amount of
€10,000,000) in such proportions as UPC Distribution may specify in the
Cancellation Notice) on the date specified in the Cancellation Notice.  Any cancellation in part shall be applied
against the relevant Facility D1 Commitment, Facility D2 Commitment, Facility
D3 Commitment, Facility D4 Commitment Facility D5 Commitment or, as the case
may be, Additional Facility Commitment of each Lender pro rata.

 

7.3                               Voluntary prepayment

 

(a)                                  UPC Distribution may, by delivering to the Facility
Agent a duly completed Cancellation Notice not less than five Business Days
prior to the due date of prepayment, prepay the whole or any part, (but if in
part in an aggregate minimum Original Euro Amount of €10,000,000) of the
outstanding Advances made to it under Facility D1, Facility D2, Facility D3,
Facility D4, Facility D5 or, subject to paragraph (b) below, any Additional
Facility.

 

(b)                                 Any voluntary prepayment made under paragraph (a)
above will be applied:

 

(i)                                     first, against Facility D1, Facility D2, Facility D3,
Facility D4 or Facility D5 in such proportions as may be specified by UPC
Distribution in the notice of prepayment; and

 

(ii)                                  second, once all outstanding Facility D Advances have
been repaid or prepaid in full and all undrawn Facility D Commitments have been
cancelled, against the Additional Facilities in such proportion as may be
specified by UPC Distribution in the notice of prepayment and against all the
outstanding Additional Facility Advances made under the relevant Additional
Facilities pro rata.

 

7.4                               Change of Control

 

(a)                                  If:

 

(i)                                     UGC ceases:

 

(A)                              directly or indirectly to own more than 50 per cent.
of the issued share capital of UGCE Inc.; and

 

(B)                                to Control UGCE Inc.; or

 

(ii)                                  after completion of the Approved Transaction, Liberty
Media Corporation together with one or more of its Associated Companies does
not or ceases to directly or indirectly own 10 per cent. or more of the issued
share capital of UGCE Inc. from time to time; or

 

(iii)                               UGCE Inc. does not or ceases to own, directly or
indirectly through one or more of its Subsidiaries or other persons Controlled
by it, the legal and beneficial interest in more than 50 per cent. of the
voting and economic rights attaching to the issued share capital of, or
otherwise ceases to Control,  UPC
Distribution Holdco, (except as a result of a merger or consolidation of UPC
Distribution Holdco with or into a Shareholder, provided that such merger or
consolidation is in accordance with paragraph (b) below); or

 

(iv)                              in accordance with the terms of any share pledge in
favour of the Security Agent over the issued share capital of UPC Distribution
and UPC Holding II, UPC Distribution Holdco does not or ceases to own directly
(or indirectly through one or more of its

 

50

 

Subsidiaries or
other persons Controlled by it, subject to such Subsidiary or person complying
with Clause 26.4(a) (Additional Obligors)) the legal and beneficial interest in
100 per cent. of the issued share capital of UPC Distribution and UPC Holding
II or otherwise ceases to Control UPC Distribution and UPC Holding II; or

 

(v)                                 in accordance with the terms of the share pledges in
favour of the Security Agent over the issued share capital of each of the
Obligors (other than UPC Distribution Holdco, UPC Holding II, UPC Financing and
UPC Distribution), UPC Distribution does not or ceases to own directly or
indirectly through one or more of its Subsidiaries or other persons Controlled
by it, the legal and beneficial interest in at least 75 per cent. of the voting
and economic rights attaching to the issued share capital of any Obligor (other
than UPC Distribution Holdco, UPC Holding II, UPC Financing or UPC
Distribution) or otherwise ceases to Control such Obligor; or

 

(vi)                              UPC Distribution and UPC Holding II do not or cease to
own, in accordance with the terms of the pledge referred to in paragraph 2 of
Schedule 7 (Security Documents), the legal and beneficial interest in 100
per cent. of the partnership interests and economic rights attaching to the
partnership interests of, or otherwise ceases to Control, UPC Financing,

 

(any of the
events described in (i) to (vi) above being a Change
of Control):

 

(A)                              UPC Distribution shall promptly notify the Facility
Agent upon becoming aware of a Change of Control; and

 

(B)                                if the Majority Lenders so require, the Facility Agent
shall, by not less than 20 Business Days’ notice to UPC Distribution, cancel
each Facility and declare all outstanding Advances, together with accrued
interest and all other relevant amounts accrued under the Finance Documents
immediately due and payable, whereupon each Facility will be cancelled and all
such outstanding amounts will become immediately due and payable.

 

(b)                                 UPC Distribution Holdco shall not enter into a merger
or consolidation with or into a Shareholder (the resulting entity being the UPC Merged Entity) unless:

 

(i)                                     reasonable details of the proposed merger concerning
the matters set out in paragraphs (ii) and (iii) below are provided to the
Facility Agent at least 10 days before the merger is to be entered into;

 

(ii)                                  the UPC Merged Entity will be liable for the
obligations of UPC Distribution Holdco (including the obligations under the
Finance Documents), which obligations will continue in full force and effect
after the merger, and entitled to the benefit of all rights of UPC Distribution
Holdco; and

 

(iii)                               the UPC Merged Entity has entered into Security
Documents (if applicable) which provide security over the same assets of at
least an equivalent nature and ranking to the security provided by UPC
Distribution Holdco pursuant to any Security Documents entered into by it and
such Security Documents are the legal, valid and binding obligations of the UPC
Merged Entity enforceable in accordance with their terms subject (to the extent
applicable) to substantially similar qualifications to those made in the legal
opinions referred to in 0 (Conditions Precedent Documents).

 

51

 

7.5                               Mandatory prepayment from Excess Cash
Flow and Net Equity Proceeds

 

(a)                                  Subject to paragraph (b) below and Clause 7.7 (Date
for prepayment), within 10 Business Days of the delivery of the Borrower
Group’s audited consolidated financial statements which relate to any financial
year of the Borrower Group (starting with the annual Accounting Period ending
31st December, 2004) under Clause 16.2 (Financial information) the Borrowers
(unless otherwise agreed in writing by the Facility Agent acting on the
instructions of the Majority Lenders) shall prepay, or procure that there is
prepaid, an amount of the Facilities equal to 50 per cent. of the Excess Cash
Flow for such financial year.

 

(b)                                 The Borrowers shall not be required to make any
prepayments under paragraph (a) above:

 

(i)                                     after the date on which the Facility Agent receives
financial statements delivered under Clause 16.2(b) (Financial information)
which show that, for the two most recent Ratio Periods, the ratio of Senior
Debt to Annualised EBITDA is less than or equal to 3.5:1; or

 

(ii)                                  if the amount of Excess Cash Flow in respect of the
relevant financial year is less than €5,000,000.

 

(c)                                  (i)                                     Subject to Clause 7.7 (Date for prepayment) and
paragraph (e) below UPC Distribution shall, within ten Business Days of receipt
by any member of the UGCE Borrower Group of Net Equity Proceeds received by or
for the account of that  member of the
UGCE Borrower Group (where such proceeds are received on or after 31st December,
2004), prepay or procure that there is prepaid, until the Additional Prepayment
Cap has been reached, an amount of the Facility D equal to the Make-Whole
Amount;

 

(ii)                                  For the purposes of this paragraph (c), Make-Whole Amount shall be calculated by:

 

(A)                              calculating the amount (the Relevant Amount) by which each Facility B Repayment Instalment
(as defined in the Existing Facility Agreement) would have been reduced as a
result of the operation of clause 7.5 (Mandatory prepayment from Excess Cash
Flow and Net Equity Proceeds) of the Existing Facility Agreement as a result of
the receipt of Net Equity Proceeds referred to in sub-paragraph (c)(i) above,
had the Facility B Repayment Instalments that have at the relevant time been
repaid (partly) out of the proceeds of drawings under Facility D (the Refinanced Repayment Instalments) still
remained as Facility B Repayment Instalments (as defined in the Existing
Facility Agreement) at the time of receipt of the Net Equity Proceeds referred
to above; and

 

(B)                                aggregating the Relevant Amount in respect of each
Refinanced Repayment Instalment, such aggregate amount constituting the
Make-Whole Amount.

 

(iii)                               The amount of the prepayment of Facility D referred to
in sub-paragraph (c)(i) above shall be applied pro rata against all outstanding
Facility D Advances.

 

(d)                                 (i)                                     In addition to any prepayments under sub-paragraph (c)
above or under clause 7.5(c)(i)(A) or (c)(ii)(A), (Mandatory prepayment from
Excess Cash Flow and Net Equity Proceeds) of the Existing Facility Agreement,
subject to sub-paragraph (d)(ii) and paragraph (e) below and Clause 7.7 (Date
for prepayment) UPC Distribution shall, within ten Business Days of receipt by
a member of the UGCE Borrower Group of the proceeds of an issue of Relevant
Convertible Preference Shares (where such

 

52

 

proceeds are received on or after 31st December, 2004 and whether or not
such Relevant Convertible Preference Shares also constitute Net Equity
Proceeds), prepay or procure that there is prepaid, until the Additional
Prepayment Cap has been reached, an amount of Facility D equal to 90 per cent.
of the proceeds of the Relevant Convertible Preference Shares.  Such amount shall be applied first pro rata
against all outstanding Facility D Advances and, second, (but only following
prepayment of the Existing Facilities as described in sub-paragraph (d)(ii)
below) pro rata against all outstanding Additional Facility Advances in
accordance with Clause 7.8 (Order of application).

 

(ii)                                  To the extent that the amount required to be prepaid
under sub-paragraph d(i) above exceeds the amounts outstanding under Facility D
at the relevant time UPC Distribution shall prepay or procure that there is
prepaid, until the Additional Prepayment Cap has been reached:

 

(A)                              until all outstanding Facility D Advances have been
permanently prepaid and cancelled and there are no undrawn Commitments under
Facility D, outstanding Facility B Advances under the Existing Facility; and

 

(B)                                after all outstanding Facility D Advances have been
permanently prepaid and cancelled and once there are no undrawn Commitments
under Facility D, outstanding Facility B Advances or outstanding Facility C
Advances under the Existing Facility as specified by UPC Distribution in the
relevant cancellation notice,

 

in each case in an amount equal to such excess in accordance with clause
7.5(d)(i)(C) (Mandatory prepayment from Excess Cash Flow and Net Equity
Proceeds) of the Existing Facility Agreement.

 

(iii)                               In addition to any prepayments under sub-paragraph (c)
above or under clause 7.5(c)(i)(A) or (c)(ii)(A), (Mandatory prepayment from
Excess Cash Flow and Net Equity Proceeds) of the Existing Facility Agreement,
subject to sub-paragraph (d)(iv) and paragraph (e) below and Clause 7.7 (Date
for prepayment) and to the extent that UPC Distribution is not required to make
prepayments under sub-paragraph (d)(i) or (ii) because the Additional
Prepayment Cap has been reached UPC Distribution shall, within ten Business
Days of receipt by or for the account of a member of the UGCE Borrower Group of
the proceeds of an issue of Relevant Convertible Preference Shares (where such
proceeds are received on or after 31st December, 2004 and whether or not such
Relevant Convertible Preference Shares also constitute Net Equity Proceeds),
prepay or procure that there is prepaid an amount of Facility D equal to 40 per
cent. of the balance of the proceeds of the Relevant Convertible Preference
Shares which have not been taken into account when calculating the payments to
be made under sub-paragraph (d)(i) above. 
Such amount shall be applied first pro rata against all outstanding
Facility D Advances and, second, (but only following pre-payment of the
Existing Facilities as described in sub-paragraph (d)(iv) below) pro rata
against all outstanding Additional Facility Advances in accordance with Clause
7.8 (Order of application).

 

(iv)                              To the extent that the amount required to be prepaid
under sub-paragraph (d)(iii) above exceeds the amounts outstanding under
Facility D at the relevant time, UPC Distribution shall prepay or procure that
there is prepaid:

 

53

 

(A)                              until all outstanding Facility D Advances have been
permanently prepaid and cancelled and there are no undrawn Commitments under
Facility D, outstanding Facility B Advances under the Existing Facility; and

 

(B)                                after all outstanding Facility D Advances have been
permanently prepaid and cancelled and once there are no undrawn Commitments
under Facility D, outstanding Facility B Advances or outstanding Facility C
Advances under the Existing Facility as specified by UPC Distribution in the
relevant cancellation notice,

 

in each case in an amount equal to such excess in accordance with clause
7.5(d)(ii)(C) (Mandatory prepayment from Excess Cash Flow and Net Equity
Proceeds) of the Existing Facility Agreement.

 

(e)                                  UPC Distribution shall not be required to make any
prepayments under paragraphs (c) or (d) above:

 

(i)                                     provided that the most recently delivered financial
statements provided to the Facility Agent under Clause 16.2(b) (Financial
information) show that, for the two most recent Ratio Periods, the applicable
ratio for the purposes of Clause 17.2(a) (Financial ratios) is 3.5:1 or less;

 

(ii)                                  to the extent that such Net Equity Proceeds are
provided by another member of the UGCE Borrower Group which is funding such
acquisition by means of proceeds which have previously been treated as “Net
Equity Proceeds” of that member of the UGCE Borrower Group for the purposes of
Clause 7.5(c)(i) above;

 

(iii)                               in respect of Net Equity Proceeds in respect of a new
issue of shares by any member of the UGCE Borrower Group subscribed for by any
other member of the UGCE Borrower Group; or

 

(iv)                              in respect of Net Equity Proceeds relating to any
issuance of shares where all of the shares issued are subscribed for by any
member of the Wider Group.

 

7.6                               Prepayment from disposal proceeds

 

(a)                                  If the Net Proceeds of disposals of assets comprising
or contributing in aggregate a percentage value of 5 per cent. or less of the
total assets, revenues and EBITDA of the Borrower Group are either:

 

(i)                                     reinvested in the business of the Borrower Group
within 12 months of receipt; or

 

(ii)                                  deposited immediately with the Facility Agent and:

 

(A)                                 applied in prepayment of the Existing Facility and
reduction of the Total Facility A Commitments, Total Facility B Commitments and
Total Facility C Commitments (each as defined in the Existing Facility) in
accordance with the mechanics set out in clauses 7.7 (Date for prepayment) and
7.8 (Order of application) of the Existing Facility Agreement; and

 

(B)                                   once the Existing Facility has been repaid in full,
applied in prepayment of the Facilities and reduction of the Total Facility D1
Commitments, Total Facility D2 Commitments, Total Facility D3 Commitments,
Total Facility D4 Commitments, Total Facility D5 Commitments, and Total
Additional

 

54

 

Facility Commitments (if any) (in accordance with the mechanics set out
in Clauses 7.7 (Date for prepayment) and 7.8 (Order of application)),

 

the percentage
value of such assets shall not be taken into account for the purposes of Clause
16.10(b)(viii) (Disposals).

 

(b)                                 For the purposes of paragraph (a) above and Clause 16.10(b)
(Disposals), percentage value of
an asset disposed of means the percentage of the total assets, revenues and
EBITDA of the Borrower Group (as the case may be) attributable to such asset in
respect of the financial year (in the case of revenues and EBITDA) or as at the
end of the financial year (in the case of total assets) immediately preceding
the financial year in which the asset is disposed of and for the avoidance of
doubt, the value of assets disposed of will be calculated on an increasing percentage
basis such that any percentage value will automatically be added to the
percentage value of any subsequent disposal. 
For the purpose of this Clause 7.6(b), all calculations shall be by
reference to the annual consolidated financial statements of UPC Distribution
or, as the case may be, the annual combined financial statements of the
Borrower Group required to be produced pursuant to this Agreement.

 

(c)                                  If valid and enforceable security agreements (in form
and substance satisfactory to the Facility Agent) have been entered into
between, inter alia, KTA and the
Security Agent granting security over KTA’s cable network assets in favour of
the Security Agent (the KTA Security
Agreements), UPC Distribution shall:

 

(i)                                     within five Business Days of such KTA Default, apply
€100,000,000 in prepayment of the Facilities (or, if less the amount of the
Facilities); and

 

(ii)                                  promptly following enforcement by the Security Agent
of the security constituted by the KTA Security Agreements (and in any event
within five Business Days of receipt by the Security Agent of the proceeds of
such enforcement), apply an amount equal to the net proceeds of such
enforcement (after the deduction of all enforcement costs), to the extent that
such net enforcement proceeds exceed €100,000,000, in prepayment of the
Facilities (or, if less the amount of the Facilities).

 

The obligations
of UPC Distribution under this Clause 7.6(c) shall be satisfied in full on
receipt by the Security Agent of the proceeds of enforcement of the security constituted
by the KTA Security Agreements.

 

7.6A                      Mandatory prepayment from Third Party
Debt proceeds

 

(a)                                  Subject to Clause 7.7 (Date for prepayment) and
paragraph (b) below if any member of the UGCE Borrower Group incurs Third Party
Debt at any time after 31st December, 2004 and Clause 16.12(d)(i) (Restrictions
on Financial Indebtedness) applies to such Third Party Debt, UPC Distribution
shall, within ten Business Days of receipt by such member of the UGCE Borrower
Group of the proceeds of the Third Party Debt, prepay or procure that there is
prepaid, until the Additional Prepayment Cap has been reached, an amount of
Facility D equal to 50 per cent. of the proceeds of the Third Party Debt.  The amount of such prepayment shall be
applied first pro rata against relevant outstanding Facility D Advances and,
second, (but only following prepayment of the Existing Facilities as described
in paragraph (b) below) pro rata against all outstanding Additional Facility
Advances in accordance with Clause 7.8 (Order of application).

 

(b)                                 To the extent that the amount due to be prepaid under
paragraph (a) above exceeds the outstanding amounts under Facility D at the
relevant time, UPC Distribution shall prepay or procure that there is prepaid,
until the Additional Prepayment Cap has been reached:

 

55

 

(i)                                     until all outstanding Facility D Advances have been
permanently prepaid and cancelled and there are no undrawn Commitments under
Facility D, outstanding Facility B Advances under the Existing Facility; and

 

(ii)                                  after all outstanding Facility D Advances have been
permanently prepaid and cancelled and once there are no undrawn Commitments
under Facility D, outstanding Facility B Advances or outstanding Facility C
Advances under the Existing Facility as specified by UPC Distribution in the
relevant cancellation notice,

 

in each case, in
an amount equal to the amount of such excess in accordance with clause
7.6A(b)(i)(B) (Mandatory prepayment from Third Party Debt proceeds) of the
Existing Facility Agreement.

 

7.7                               Date for prepayment

 

Each amount of
the Facilities to be prepaid under Clause 7.5 (Mandatory prepayment from Excess
Cash Flow and Net Equity Proceeds), Clause 7.6 (Prepayment from disposal
proceeds), Clause 7.6A (Mandatory prepayment from Third Party Debt proceeds)
and Clause 17.4 (Cure provisions) shall be applied in prepayment of the
Facility within the period required by the relevant Clause or deposited before
the end of such period with the Security Agent or as the Security Agent may
reasonably direct in an account (or accounts) (each a Blocked Account) in the name of any Obligor
bearing interest at rates customarily offered by the Security Agent in such
circumstances, secured (if requested by the Security Agent) by a first ranking
security interest in favour of the Security Agent on behalf of the
Beneficiaries, on terms that the principal amount so deposited may only be
released by making the relevant prepayment on Interest Dates falling
immediately thereafter, in accordance with Clause 7.8 (Order of application)
(where applicable), until the prepayment obligations under Clause 7.5
(Mandatory prepayment from Excess Cash Flow and Net Equity Proceeds), 7.6
(Prepayment from disposal proceeds), Clause 7.6A (Mandatory prepayment from
Third Party Debt proceeds) and Clause 17.4 (Cure provisions) have been
satisfied.

 

7.8                               Order of application

 

The amount of
each prepayment of the Facilities made under Clauses 7.5(a) and (d) (Mandatory
prepayment from Excess Cash Flow and Net Equity Proceeds), Clause 7.6
(Prepayment from disposal proceeds) and Clause 7.6A (Mandatory prepayment from
Third Party Debt proceeds) shall be applied:

 

(a)                                  first, pro rata between outstanding Facility D
Advances with a corresponding permanent cancellation of the Total Facility D1
Commitments, Total Facility D2 Commitments, Total Facility D3 Commitments,
Total Facility D4 Commitments and Total Facility D5 Commitments (pro rata
between the Commitments of the Lenders under the relevant Facility D); and

 

(b)                                 second, once all outstanding Facility D Advances have
been repaid or prepaid in full and all undrawn Facility D Commitments have been
cancelled and subject to any requirements described this Agreement first to
apply amounts in prepayment of the Existing Facilities, pro rata between
outstanding Additional Facility Advances with a corresponding permanent
cancellation of the Total Additional Facility Commitments (pro rata between the
Commitments of the Lenders under each Additional Facility).

 

56

 

7.9                               Right of prepayment and cancellation
in relation to a single Lender

 

(a)                                  If:

 

(i)                                     any sum payable to any Lender by a Borrower is
required to be increased under Clause 10.2(c) (Tax gross-up); or

 

(ii)                                  any Lender claims indemnification from a Borrower
under Clause 10.3 (Tax indemnity) or Clause 12.1 (Increased Costs),

 

a Borrower may,
whilst the circumstance giving rise to the requirement or indemnification
continues, in respect only of the Facilities made available to it, give the
Facility Agent notice of cancellation of the Facility D1 Commitment, Facility
D2 Commitment, Facility D3 Commitment, Facility D4 Commitment, Facility D5
Commitment and/or Additional Facility Commitment (as applicable) of that Lender
and its intention to procure the repayment of that Lender’s participation in
all relevant Advances.

 

(b)                                 On receipt of a notice referred to in paragraph (a)
above, the Facility D1 Commitment, Facility D2 Commitment, Facility D3
Commitment, Facility D4 Commitment, Facility D5 Commitment and/or Additional
Facility Commitment (as applicable) of that Lender shall each immediately be
reduced to zero.

 

(c)                                  On the last day of each Interest Period which ends
after a Borrower has given notice under paragraph (a) above (or, if earlier,
the date specified by the relevant Borrower in that notice), the relevant
Borrower shall repay that Lender’s participation in all relevant Advances.

 

(d)                                 Prepayments made pursuant to this Clause 7.9 shall be
applied against the outstanding Advances pro rata.

 

7.10                        Automatic cancellation of Facility D

 

(a)                                  In the event of a prepayment and cancellation of all
or part of Facility B, the undrawn Facility D Commitments of the Facility D
Lenders will be automatically cancelled in an amount equal to the Relevant
Reduced Amount.

 

For the purposes
of this Clause 7.10:

 

(i)                                     Relevant Reduced Amount means the aggregate amount by which the Relevant
Repayment Instalments are reduced as a result of a prepayment and cancellation
of Facility B; and

 

(ii)                                  Relevant Repayment Instalments means, at any time, each Facility B Repayment
Instalment which falls to be paid on a Repayment Date (as defined in the
Existing Facility Agreement) corresponding to a Utilisation Date under Facility
D in respect of undrawn Facility D Commitments at that time:

 

(b)                                 In the case of a prepayment and cancellation of
Facility B applied pro rata against the Relevant Repayment Instalments the
undrawn Facility D Commitments will be automatically cancelled pro rata against
each undrawn Facility D.  Such
cancellation will be applied against the undrawn Facility D Commitment of each
Facility D Lender in respect of each undrawn Facility D pro rata;

 

(c)                                  In the case of a prepayment and cancellation of
Facility B applied other than pro rata across the Relevant Payment Instalments,
the Facility D Commitments in respect of each undrawn

 

57

 

Facility D will
be automatically cancelled by the amount by which the Relevant Repayment
Instalment which falls due to be repaid on the Utilisation Date for that
Facility D is reduced as a result of such prepayment and cancellation.  Such cancellation will be applied against
the undrawn Facility D Commitment of each Facility D Lender pro rata.

 

7.11                        Miscellaneous provisions

 

(a)                                  Any Cancellation Notice delivered under this Agreement
is irrevocable.  The Facility 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 and, subject to Clause 23.4
(Break Costs), without premium or penalty.

 

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

 

(d)                                 No amount prepaid under this Agreement may
subsequently be re-borrowed.

 

(e)                                  No amount of any Commitment cancelled under this
Agreement may subsequently be reinstated.

 

(f)                                    Any prepayment in part of any Advance shall be applied
against the participations of the Lenders in that Advance pro rata.

 

8.                                      INTEREST

 

8.1                               Interest rate

 

The rate of
interest on each Advance for its Interest Period is the rate per annum
determined by the Facility Agent to be the aggregate of:

 

(a)                                  the applicable Margin; and

 

(b)                                 (i)                                     LIBOR (in the case of an Advance denominated in US
Dollars); or

 

(ii)                                  EURIBOR (in the case of an Advance denominated in
euros); and

 

(c)                                  the Mandatory Costs.

 

8.2                               Selection of Interest Periods

 

(a)                                  The Interest Period of each Advance will be the period
selected in the Request for that Advance and each subsequent Interest Period
will be the period selected by the Borrower by notice (a Selection Notice) to the Facility Agent
received not later than the third Business Day before the end of the then
current Interest Period.

 

(b)                                 Each Interest Period shall be one month, two, three or
six months or in any case such other period not exceeding six months as the
relevant Borrower and the Facility Agent 
(acting on the instructions of all the Lenders) may agree from time to
time.  Each Interest Period for an
Advance will commence on its Utilisation Date or in the case of each subsequent
Interest Period the expiry of its preceding Interest Period.

 

58

 

8.3                               Non-Business Days

 

If an Interest
Period would otherwise end on a day which is not a Business Day, that Interest
Period 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).

 

8.4                               Further Adjustments to Interest
Periods

 

(a)                                  If an Interest Period: for a Facility D1 Advance,
Facility D2 Advance, Facility D3 Advance, Facility D4 Advance or Facility D5
Advance would otherwise overrun the Facility D Final Maturity Date, it shall be
shortened so that it ends on the Facility D Final Maturity Date.

 

(b)                                 for an Additional Facility Advance would otherwise
overrun the relevant Additional Facility Final Maturity Date, it shall be
shortened so that it ends on that Additional Facility Maturity Date.

 

8.5                               Other adjustments

 

The Facility
Agent and the Borrowers may enter into such other arrangements as they may
agree for the adjustment of Interest Periods and the consolidation and/or
splitting of Advances.

 

8.6                               Notification

 

The Facility Agent
shall notify the relevant Borrower and the Lenders of the duration of each
Interest Period promptly after ascertaining its duration.

 

8.7                               Due dates

 

Except as
otherwise provided in this Agreement, accrued interest on each Advance is
payable by the relevant Borrower on its Interest Date and also, in the case of
any Advance with an Interest Period longer than six months, at six monthly
intervals after the first day of that Interest Period for so long as the
Interest Period continues.

 

8.8                               Default interest

 

(a)                                  If an Obligor fails to pay any amount payable by it
under the Finance Documents, it shall forthwith on demand by the Facility Agent
pay interest on the overdue amount from the due date up to the date of actual
payment, both before and after judgment, at a rate (the default rate) determined by the Facility
Agent to be two per cent. per annum above the rate which would have been
payable if the Unpaid Sum had, during the period of non-payment, constituted an
Advance at the Margin applicable to a new Advance if it had been drawn down at
such time in the currency of the Unpaid Sum for such successive Interest
Periods of such duration (not being more than three months) as the Facility
Agent may determine, having regard to the likely duration of the default (a Designated Term).

 

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

 

59

 

8.9                               Notification of rates of interest

 

The Facility
Agent will promptly notify each relevant Party of the determination of a rate
of interest under this Agreement.

 

9.                                      PAYMENTS

 

9.1                               Place of Payment

 

All payments by
an Obligor or a Lender under this Agreement shall be made to the Facility Agent
to its account at such office or bank in the principal financial centre of the
country of the currency concerned (or, in the case of euros, the financial
centre of such of the Participating Member States or London) as the Facility
Agent may notify to the Obligor or Lender for this purpose.

 

9.2                               Funds

 

Payments under
this Agreement to the Facility Agent shall be made for value on the due date at
such times and in such funds as the Facility 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.

 

9.3                               Distribution

 

(a)                                  Each payment received by the Facility Agent under this
Agreement for another Party shall, subject to paragraphs (b) and (c) below, be
made available by the Facility 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 euros, in the principal financial centre of such of the
Participating Member States or London) as it may notify to the Facility Agent
for this purpose by not less than five Business Days’ prior notice.

 

(b)                                 The Facility 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
Facility Agent for the account of another Party, the Facility Agent is not
obliged to pay that sum to that Party until it has established that it has
actually received that sum.  The
Facility 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 Facility Agent has
paid a corresponding amount to another Party, that Party shall forthwith on
demand refund the corresponding amount to the Facility 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 Facility Agent to reflect its cost of funds.

 

9.4                               Currency

 

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

 

(b)                                 All interest is payable in the currency in which the
relevant amount in respect of which it is payable is denominated.

 

60

 

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

 

(d)                                 Any other amount payable under this Agreement is,
except as otherwise provided in this Agreement, payable in euros.

 

9.5                               Set-off and counterclaim

 

All payments
made by an Obligor under this Agreement shall be made without set-off or
counterclaim.

 

9.6                               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.

 

9.7                               Partial payments

 

(a)                                  Subject to the Security Deed, if the Facility Agent
receives a payment insufficient to discharge all the amounts then due and
payable by an Obligor under this Agreement, the Facility 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 Facility Agent under this Agreement;

 

(ii)                                  secondly, in or towards payment pro rata of any accrued fees (other than any
commitment fees payable under Clause 20.1 (Commitment fee)) due but unpaid
under Clause 20 (Fees);

 

(iii)                               thirdly, in or towards payment to the Lenders pro rata of any accrued interest
and commitment fees due but unpaid under this Agreement;

 

(iv)                              fourthly, in or towards payment to the Lenders 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
the Finance Documents.

 

(b)                                 Subject to the Security Deed, the Facility Agent
shall, if so directed by all of the Lenders, vary the order set out in
sub-paragraphs (a)(ii) to (v) above. 
The Facility Agent shall notify UPC Distribution of any such variation.

 

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

 

10.                               TAX
GROSS-UP AND INDEMNITIES

 

10.1                        Definitions

 

(a)                                  In this Clause 10:

 

61

 

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

 

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

 

Tax
Deduction means a deduction or
withholding for or on account of Tax from a payment under a Finance Document.

 

Tax
Payment means an increased
payment made by an Obligor to a Finance Party under Clause 10.2 (Tax gross-up)
or a payment under Clause 10.3 (Tax indemnity).

 

Treaty
Lender means a Lender which
is (on the date a payment falls due), entitled to that payment under a double
taxation agreement in force on the date (subject to the completion of any
necessary procedural formalities) without a Tax Deduction.

 

(b)                                 In this Clause 10 a reference to determines or determined means a determination made in the absolute
discretion of the person making the determination.

 

10.2                        Tax gross-up

 

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

 

(b)                                 UPC Distribution or a Lender shall promptly upon
becoming aware that an Obligor must make a Tax Deduction (or that there is any
change in the rate or the basis of a Tax Deduction) notify the Facility Agent
accordingly.  If the Facility Agent
receives such notification from a Lender it shall notify UPC Distribution and
that Obligor.

 

(c)                                  Subject to Clause 10.5 (U.S. Taxes), if a Tax
Deduction is required by law to be made by an Obligor, the amount of the
payment due from that Obligor shall be increased to an amount which (after
making any Tax Deduction) leaves an amount equal to the payment which would
have been due if no Tax Deduction had been required.

 

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

 

(e)                                  Within 30 days of making either a Tax Deduction or any
payment required in connection with that Tax Deduction, the Obligor making that
Tax Deduction shall deliver to the Facility Agent for the Finance Party
entitled to the payment evidence reasonably satisfactory to that Finance Party
that the Tax Deduction has been made or (as applicable) any appropriate payment
paid to the relevant taxing authority.

 

(f)                                    A Treaty Lender and each Obligor which makes a payment
to which that Treaty Lender is entitled shall co-operate and use its reasonable
efforts to complete any procedural formalities and provide any information, in
each case on a timely basis, necessary for that Obligor to obtain authorisation
to make that payment without a Tax Deduction (or with a reduced rate of such
Tax Deduction).

 

62

 

10.3                        Tax indemnity

 

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

 

(b)                                 Paragraph (a) above shall not apply with respect to
any Tax assessed on:

 

(i)                                     a Finance Party:

 

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

 

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

 

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

 

(ii)                                  the Facility Agent, as a result of the failure by a
Lender to satisfy on the due date of a payment of interest either of the
conditions set out in Clause 19.15(b)(i)(A) and (B) (Lenders).

 

(c)                                  A Protected Party making or intending to make a claim
pursuant to paragraph (a) above shall promptly notify the Facility Agent in
writing of the event which will give, or has given, rise to the claim,
including details of the nature of the Tax due or paid by that Protected Party,
following which the Facility Agent shall promptly provide such information to
UPC Distribution.

 

(d)                                 A Protected Party shall, on receiving a payment from
an Obligor under this Clause 10.3, notify the Facility Agent.

 

10.4                        Tax Credit

 

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

 

(i)                                     a Tax Credit is attributable to that Tax Payment; and

 

(ii)                                  that Finance Party has obtained, utilised and retained
that Tax Credit,

 

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

 

(b)                                 No provision of this Agreement shall:

 

(i)                                     interfere with the right of any Finance Party to
arrange its tax or any other affairs in whatever manner it thinks fit or oblige
any Finance Party to claim any credit, relief, remission or repayment in
respect of any payment of Tax in priority to any other credit, relief,
remission or repayment available to it, except that the Finance Party’s sole
reason (acting in good faith) for not claiming or for deferring such credit,
relief,

 

63

 

remission or
repayment shall not be its obligation to make a payment under this Clause 10.4;
or

 

(ii)                                  oblige any Finance Party to disclose any information
relating to its Tax or other affairs or any computations in respect thereof.

 

10.5                        U.S. Taxes

 

A US Borrower
shall not be required to pay any additional amount pursuant to Clause 10.2 (Tax
gross-up) in respect of United States Taxes (including, without limitation,
federal, state, local or other income Taxes), branch profits or franchise Taxes
with respect to a sum payable by it pursuant to this Agreement to a Lender if on
the date such Lender becomes a Party to this Agreement or has designated a new
Facility Office either:

 

(a)                                  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 has not provided the Borrower with two accurate and complete original
signed copies of (i) U.S. Internal Revenue Service Form W-8BEN (relating to
such Lender and claiming a complete exemption from withholding under an income
tax treaty (or successor form) or (ii) U.S. Internal Revenue Service  Form W-8ECI (or successor form) certifying,
in each case, to such Lender’s entitlement as of such date to a complete
exemption from United States withholding with respect to all amounts payable
pursuant to the Finance Documents;

 

(b)                                 after the date such Lender becomes a Party to this
Agreement, when a lapse in time or change in circumstances renders the previous
certification of such Lender made pursuant to Clause 10.5(a) above obsolete or
inaccurate, such Lender has not delivered to UPC Distribution two new accurate
and complete original signed copies of Internal Revenue Service Form W-8ECI or
Form W-8BEN (with respect to the benefit of any income tax treaty), as the case
may be, and such other forms as may be required in order to confirm or
establish the entitlement of such Lender to a continued exemption from or
reduction in United States withholding tax with respect to amounts payable
pursuant to the Finance Documents; or

 

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

 

10.6                        Value added tax

 

(a)                                  All consideration payable under a Finance Document by
an Obligor to a Finance Party shall be deemed to be exclusive of any VAT.  If VAT is chargeable, the Obligor shall,
following delivery of a VAT invoice, pay to the Finance Party (in addition to
and at the same time as paying the consideration) an amount equal to the amount
of the VAT.

 

(b)                                 Where a Finance Document requires an Obligor to
reimburse a Finance Party for any costs or expenses, that Obligor shall also at
the same time pay and indemnify that Finance Party against all VAT incurred by that
Finance Party in respect of the costs or expenses save to the extent that that
Finance Party is entitled to repayment or credit in respect of the VAT.

 

64

 

11.                               MARKET
DISRUPTION

 

11.1                        Absence of quotations

 

Subject to
Clause 11.2 (Market disruption), if LIBOR or, if applicable, EURIBOR is to be
determined by reference to the Reference Banks but a Reference Bank does not
supply a quotation by noon on the Rate Fixing Day, the applicable LIBOR or
EURIBOR shall be determined on the basis of the quotations of the remaining
Reference Banks.

 

11.2                        Market disruption

 

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

 

(i)                                     the Margin;

 

(ii)                                  the rate notified to the Facility Agent by that Lender
as soon as practicable and in any event before interest is due to be paid in
respect of that Interest Period, to be that which expresses as a percentage
rate per annum the cost to that Lender of funding its participation in that
Advance from whatever source it may reasonably select; and

 

(iii)                               the Mandatory Cost.

 

(b)                                 In this Agreement Market
Disruption Event means:

 

(i)                                     at or about noon on the Rate Fixing Day for the
relevant Term or Interest Period the Screen Rate is not available and none or
only one of the Reference Banks supplies a rate to the Facility Agent to
determine LIBOR or, if applicable, EURIBOR for the relevant currency and
period; or

 

(ii)                                  before close of business in London on the Rate Fixing
Day for the relevant Interest Period, the Facility Agent receives notifications
from a Lender or Lenders (whose participations in an Advance aggregate not less
than one-third of that Advance) that the cost to it of obtaining matching
deposits in the London Interbank Market or, as the case may be, the European
Interbank Market would be in excess of LIBOR or, if applicable, EURIBOR.

 

11.3                        Alternative basis of interest or
funding

 

(a)                                  If a Market Disruption Event occurs and the Facility
Agent or UPC Distribution so requires, the Facility Agent and UPC Distribution
shall enter into negotiations (for a period of not more than 30 days) with a
view to agreeing a substitute basis for determining the rate of interest.

 

(b)                                 Any alternative basis agreed pursuant to paragraph (a)
above shall, with the prior consent of all the Lenders and UPC Distribution, be
binding on all Parties.

 

11.4                        Revocation of currency

 

If before 9.30
a.m. on any Rate Fixing Day, the Facility Agent receives notice from a Lender
that:

 

65

 

(a)                                  it is impracticable for the Lender to fund its
participation in an Advance in US Dollars during that Interest Period in the
ordinary course of business in the London or (in the case of euro) European
Interbank Market; and/or

 

(b)                                 the use of US Dollars might contravene any law or
regulation,

 

the Facility
Agent shall give notice to UPC Distribution and to the Lenders to that effect
before 11.00 a.m. on that day.  In this
event:

 

(i)                                     UPC Distribution and the Lenders may agree that the
drawdown will not be made; or

 

(ii)                                  in the absence of agreement:

 

(A)                              that Lender’s participation in the Advance (or, if
more than one Lender is similarly affected, those Lender’s participations in
the Advance) shall be treated as a separate Advance denominated in euros during
the relevant Interest Period;

 

(B)                                in the definitions of “LIBOR” or, as applicable,
“EURIBOR”, (insofar as it applies to that Advance) in Clause 1.1 (Definitions):

 

I.                                         there shall be substituted for the time “11.00 a.m.”
the time “1.00 p.m.”; and

 

II.                                     paragraph (c) of the relevant definition shall apply.

 

12.                               INCREASED
COSTS

 

12.1                        Increased Costs

 

(a)                                  Subject to Clause 12.3 (Exceptions) the Borrowers
shall, within three Business Days of a demand by the Facility Agent, pay to the
Facility Agent for the account of a Finance Party the amount of any Increased
Costs incurred by that Finance Party or any of its Holding Companies as a
result of (i) the introduction of or any change in (or in the interpretation or
application of) any law or regulation after the Signing Date or (ii) compliance
with any law or regulation made after the Signing Date.

 

(b)                                 In this Agreement Increased
Costs means:

 

(i)                                     a reduction in the rate of return from the Facilities
or on a Finance Party’s (or any of its Holding Companies’) overall capital;

 

(ii)                                  an additional or increased cost; or

 

(iii)                               a reduction of any amount due and payable under any
Finance Document,

 

which is
incurred or suffered by a Finance Party or any of its Holding Companies to the
extent that it is attributable to that Finance Party having entered into its
Commitment or funding or performing its obligations under any Finance Document.

 

12.2                        Increased cost claims

 

(a)                                  A Finance Party intending to make a claim pursuant to
Clause 12.1 (Increased Costs) as soon as is reasonably practicable after that
Finance Party becomes aware that circumstances have

 

66

 

arisen which
entitle it to make such claim, shall notify the Facility Agent of the event
giving rise to the claim, following which the Facility Agent shall promptly
notify UPC Distribution.

 

(b)                                 Each Finance Party shall, as soon as practicable after
a demand by the Facility Agent, provide a certificate confirming the amount of
its Increased Costs.

 

12.3                        Exceptions

 

(a)                                  Clause 12.1 (Increased Costs) does not apply to the
extent any Increased Cost is:

 

(i)                                     attributable to a Tax Deduction required by law to be
made by an Obligor;

 

(ii)                                  compensated for by Clause 10.3 (Tax indemnity) (or
would have been compensated for under Clause 10.3 (Tax indemnity) but was not
so compensated solely because one of the exclusions in Clause 10.3(b) (Tax
indemnity) applied);

 

(iii)                               compensated for by the payment of the Mandatory Cost;
or

 

(iv)                              attributable to the wilful breach by the relevant
Finance Party or any of its Holding Companies of any law or regulation.

 

(b)                                 In this Clause 12.3, a reference to a Tax Deduction has the same meaning given to
the term in Clause 10.1 (Definitions).

 

13.                               ILLEGALITY
AND MITIGATION

 

13.1                        Illegality

 

If it is or will
become unlawful in any applicable jurisdiction for a Lender to give effect to
any of its obligations as contemplated by this Agreement or to fund or allow to
remain outstanding all or part of its participation in any Advance:

 

(a)                                  that Lender shall promptly notify the Facility Agent
upon becoming aware of the same;

 

(b)                                 upon the Facility Agent notifying UPC Distribution,
the Commitment of that Lender will be immediately cancelled; and

 

(c)                                  if the Facility Agent on behalf of such Lender
requires, the relevant Borrower or Borrowers shall repay that Lender’s
participation in any Advance made to that Borrower on the last day of the
Interest Period for each Advance occurring after the Facility Agent has
notified UPC Distribution or, if earlier, the date specified by the Lender in
the notice delivered to the Facility Agent (being no earlier than the last day
of any applicable grace period permitted by law).

 

13.2                        Mitigation

 

(a)                                  Each Finance Party shall, in consultation with UPC
Distribution, take all reasonable steps to mitigate any circumstances which
arise and which would result in any amount (including without limitation, VAT)
becoming payable under, or cancelled pursuant to, any of Clause 10 (Tax
Gross-up and Indemnities), Clause 12 (Increased Costs) or Clause 13.1
(Illegality) including (but not limited to) transferring its rights and
obligations under the Finance Documents to another Affiliate or Facility
Office.

 

67

 

(b)                                 Paragraph (a) above does not in any way limit the
obligations of any Obligor under the 
Finance Documents.

 

13.3                        Limitation of Liability

 

(a)                                  The Borrowers shall indemnify each Finance Party for
all costs and expenses reasonably incurred by that Finance Party as a result of
steps taken by it under Clause 13.2 (Mitigation).

 

(b)                                 A Finance Party is not obliged to take any steps under
Clause 13.2 (Mitigation) if, in the opinion of that Finance Party (acting
reasonably), to do so might be prejudicial to it.

 

14.                               GUARANTEE

 

14.1                        Guarantee and indemnity

 

In consideration
of the Finance Parties entering into this Agreement and, where applicable, the
other Finance Documents and performing their obligations thereunder and the
High Yield Hedging Banks from time to time entering into the High Yield Hedging
Agreements respectively, each Guarantor irrevocably and unconditionally,
jointly and severally:

 

(a)                                  guarantees to each Finance Party and the Security
Agent on behalf of the Beneficiaries punctual performance by each Borrower and
each High Yield Hedging Counterparty of all their respective obligations under
the Guaranteed Documents;

 

(b)                                 undertakes with each Finance Party and the Security
Agent on behalf of the Beneficiaries that whenever a Borrower or a High Yield
Hedging Counterparty does not pay any amount when due under or in connection
with any Guaranteed Document, that Guarantor shall immediately on demand pay
that amount as if it was the principal obligor; and

 

(c)                                  indemnifies each Finance Party and the Security Agent
on behalf of the Beneficiaries immediately on demand against any cost, loss or
liability suffered by that Finance Party or Beneficiary if any obligation
guaranteed by it is or becomes unenforceable, invalid or illegal.  The amount of the cost, loss or liability
shall be equal to the amount which that Finance Party or Beneficiary would
otherwise have been entitled to recover.

 

Any demand issued
to a Guarantor under this Clause 14.1 shall be copied to UPC Distribution at
the same time as it is issued to the relevant Guarantor, provided that failure
to do so shall not affect the validity or effectiveness of the demand or the
obligations of the Guarantor under this Clause 14 (Guarantee).

 

14.2                        Continuing guarantee

 

This guarantee
is a continuing guarantee and will extend to the ultimate balance of sums
payable by any Obligor or any High Yield Hedging Counterparty under the
Guaranteed Documents, regardless of any intermediate payment or discharge in
whole or in part.

 

14.3                        Reinstatement

 

If any payment
by an Obligor or a High Yield Hedging Counterparty or any discharge given by a
Beneficiary (whether in respect of the obligations of any Obligor or any High
Yield Hedging Counterparty or any security for those obligations or otherwise)
is avoided or reduced as a result of insolvency or any similar event:

 

68

 

(a)                                  the liability of each Obligor shall continue as if the
payment, discharge, avoidance or reduction had not occurred; and

 

(b)                                 each Beneficiary shall be entitled to recover the
value or amount of that security or payment from each Obligor, as if the
payment, discharge, avoidance or reduction had not occurred.

 

14.4                        Waiver of defences

 

The obligations
of each Guarantor under this Clause 14 will not be affected by any act,
omission, matter or thing which, but for this Clause, would reduce, release or
prejudice any of its obligations under this Clause 14 (without limitation and
whether or not known to it or any Beneficiary) including:

 

(a)                                  any time, waiver or consent granted to, or composition
with, any Obligor or any High Yield Hedging Counterparty or other person;

 

(b)                                 the release of any other Obligor or any High Yield
Hedging Counterparty or any other person under the terms of any composition or
arrangement with any creditor of any member of the Borrower Group or any High
Yield Hedging Counterparty;

 

(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 any High Yield Hedging
Counterparty 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 power, authority or legal
personality of, or dissolution or change in, the members or status of an
Obligor or a High Yield Hedging Counterparty or any other person;

 

(e)                                  any amendment (however fundamental) or replacement of
a Guaranteed Document or any other document or security;

 

(f)                                    any unenforceability, illegality or invalidity of any
obligation of any person under any Guaranteed Document or any other document or
security; or

 

(g)                                 any insolvency or similar proceedings.

 

14.5                        Immediate recourse

 

None of the
Beneficiaries shall be obliged to make any claim or demand on the Borrowers or
any High Yield Hedging Counterparty or to resort to any security document or
other means of payment now or hereafter held by or available to them or it
before enforcing its rights under this Clause 14 and no action taken or omitted
by any of the Beneficiaries in connection with any such security document or
other means of payment shall discharge, reduce, prejudice or affect the
liability of any Guarantor under this Clause 14 nor shall any of the
Beneficiaries be obliged to apply any money or other property received or
recovered in consequence of any enforcement or realisation of any such Security
Document or other means of payment in reduction of the obligations and
liabilities expressed to be guaranteed by the Guarantors pursuant to this
Clause 14.

 

69

 

14.6                        Appropriations

 

Until all
amounts which may be or become payable by the Obligors and the High Yield
Hedging Counterparties under or in connection with the Guaranteed Documents
have been irrevocably paid in full, each Beneficiary (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 Beneficiary (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 an interest-bearing suspense account any
moneys received from any Guarantor or on account of any Guarantor’s liability
under this Clause 14.

 

14.7                        Deferral of Guarantors’ rights

 

Until all
amounts which may be or become payable by the Obligors and the High Yield
Hedging Counterparties under or in connection with the Guaranteed Documents
have been irrevocably paid in full (and notwithstanding payment of a dividend
in any liquidation or under any compromise or arrangement) each Guarantor
agrees that, without the prior written consent of the Facility Agent, it will
not:

 

(a)                                  exercise its rights of subrogation, reimbursement and
indemnity against any other Obligor or High Yield Hedging Counterparty or any
other person liable; or

 

(b)                                 demand or accept any security to be executed in
respect of any of its obligations under this guarantee or any other
indebtedness now or hereafter due to such Guarantor from any other member of
the Borrower Group or any High Yield Hedging Counterparty or from any other
person liable; or

 

(c)                                  take any step or enforce any right against any Obligor
or any High Yield Hedging Counterparty or any other person liable in respect of
any obligations and liabilities expressed to be guaranteed by the Guarantors
pursuant to this Clause 14; or

 

(d)                                 exercise any right of set off or counterclaim against
any other Obligor or any High Yield Hedging Counterparty or any other person
liable or claim or prove or vote as a creditor in competition with any of the
Beneficiaries in the bankruptcy, liquidation, administration or other
insolvency proceeding of any other Obligor or any High Yield Hedging
Counterparty or any other person liable or have the benefit of, or share in,
any payment from or composition with, any other Obligor or any High Yield
Hedging Counterparty or any other person liable or any other security document
now or hereafter held by any of the Beneficiaries for the obligations and
liabilities expressed to be guaranteed by the Guarantors pursuant to this
Clause 14 or for the obligations or liabilities of any other person liable, but
so that, if so directed by the Facility Agent, it will prove for the whole or
any part of its claim in the liquidation of any other Obligor or any High Yield
Hedging Counterparty, as the case may be, on terms that the benefit of such
proof and of all money received by it in respect thereof shall immediately be
transferred to an account to be designated by the Security Agent for the
Beneficiaries and applied in or towards discharge of the obligations and
liabilities expressed to be guaranteed by the Guarantors pursuant to this
Clause 14 in accordance with the Security Deed.

 

70

 

14.8                        Additional security

 

This guarantee
is in addition to and is not in any way prejudiced by any other guarantee or
security now or subsequently held by any Beneficiary.

 

14.9                        Limitation

 

Notwithstanding
any other provision of this Clause 14, the obligations of each US Guarantor
under this Clause 14, 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, any applicable provisions of
comparable state law or any applicable case law (collectively, the Fraudulent Transfer Laws), in each case
after giving effect to all other liabilities of such US Guarantor, contingent
or otherwise, that are relevant under the Fraudulent Transfer Laws 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 US Guarantor
pursuant to (i) applicable law or (ii) any agreement providing for an equitable
allocation among such US Guarantors and other Affiliates of the Borrower Group
of the obligations arising under guarantees by such parties.

 

For the purposes
of this Clause 14.9, US Guarantor
means each Guarantor incorporated (or in the case of a non-corporate Guarantor,
formed and subsisting) in the United States of America (or any of its states or
territories or any political or legal subdivision thereof).

 

15.                               REPRESENTATIONS
AND WARRANTIES

 

15.1                        Representations and warranties

 

(a)                                  Subject to paragraph (b), each Obligor makes the
representations and warranties set out in this Clause 15, in respect of itself
and (where applicable) its Subsidiaries which are members of the Borrower
Group, other than:

 

(i)                                     Clauses 15.9 (Accounts), 15.10 (Financial condition)
and 15.14 (Business Plan) Clause 15.15(b) (Tax liabilities) and 15.25 (Dutch
Banking Act), which shall only be made by UPC Distribution;

 

(ii)                                  Clause 15.24 (UPC Financing), which shall only be made
by UPC Financing,

 

to each Finance
Party.

 

(b)                                 UPC Distribution Holdco does not make the
representations and warranties set out in Clauses 15.6(b) or (c) (Consents),
15.7 (Material Contracts), 15.9 (Accounts), 15.10 (Financial condition), 15.11
(Environmental), 15.13(a) (Litigation and insolvency proceedings), 15.15(a)
(Tax liabilities), 15.16 (Ownership of assets), 15.17 (Intellectual Property
Rights), 15.19 (Borrower Group structure) and 15.24 (UPC Financing).

 

15.2                        Status

 

(a)                                  It is a corporation, duly incorporated and validly
existing under the laws of its place of incorporation and, in the case of UPC
Financing only, it is a Delaware general partnership duly formed and wholly
existing under the laws of its place of formation.

 

(b)                                 It has the power to own its assets and carry on its
business as it is being conducted.

 

71

 

15.3                        Powers and authority

 

It has the
power:

 

(a)                                  to enter into and comply with all obligations
expressed on its part under the Finance Documents; and

 

(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 14 (Guarantee),

 

and has taken
all necessary actions to authorise the execution, delivery and performance of
the Finance Documents to which it is a party.

 

15.4                        Legal validity

 

(a)                                  Each Finance Document to which it is or will be a
party constitutes, or when executed in accordance with its terms will
constitute, its legal, valid and binding obligations enforceable, subject to
any relevant reservations or qualifications as to matters of law contained in
any legal opinion referred to in paragraph 3 of Part 1 of 0 (Conditions
Precedent Documents) or (as applicable) paragraph 12 of Part 2 of 0 (Conditions
Precedent Documents), in accordance with its terms.

 

(b)                                 The choice of English law as the governing law of the
Finance Documents and its irrevocable submission to the jurisdiction of the
courts of England in respect of any proceedings relating to the Finance
Documents (in each case other than any Finance Document which is expressly to
be governed by a law other than English law) will be recognised and enforced in
its jurisdiction of incorporation, subject to any relevant reservation or
qualification as to matters of law contained in any legal opinion referred to
in paragraph (a) above.

 

(c)                                  Any judgment obtained in England in relation to a
Finance Document (in each case other than any Security Document which is
expressly to be governed by a law other than English law) will be recognised
and enforced in its jurisdiction of incorporation, subject to any relevant
reservation or qualification as to matters of law contained in any legal
opinion referred to in paragraph (a) above.

 

15.5                        Non-violation

 

The execution
and delivery by it of, the Finance Documents to which it is a party, and its
performance of the transactions contemplated thereby, will not violate:

 

(a)                                  in any material respect, any law or regulation or
official judgment or decree applicable to it;

 

(b)                                 in any material respect, its constitutional documents;
or

 

(c)                                  any agreement or instrument to which it is a party or
binding on any of its assets or binding upon any other member of the Borrower
Group or any other member of the Borrower Group’s assets, where such violation
would or is reasonably likely to have a Material Adverse Effect.

 

72

 

15.6                        Consents

 

(a)                                  Subject to any relevant reservations or qualifications
contained in any legal opinion referred to in Clause 15.4(a) (Legal validity)
above, all material and necessary authorisations, registrations, consents,
approvals, licences (other than the Licences), and filings required by it in
connection with the execution, validity or enforceability of the Finance
Documents to which it is a party and performance of the transactions
contemplated by the Finance Documents have been obtained (or, if applicable,
will be obtained within the required time period) and are validly existing.

 

(b)                             The Licences are in full force and effect and each
member of the Borrower Group is in compliance in all material respects with all
provisions thereof such that the Licences are not the subject of any pending
or, to the best of its knowledge, threatened attack, suspension or revocation
by a competent authority except, in each case, to the extent that any lack of
effect, non-compliance or attack, suspension or revocation of a Licence would
not have or be reasonably likely to have a Material Adverse Effect.

 

(c)                                  All the Necessary Authorisations are in full force and
effect, each member of the Borrower Group is in compliance in all material
respects with all provisions thereof and the Necessary Authorisations are not
the subject of any pending or, to the best of its knowledge, threatened attack
or revocation by any competent authority except, in each case, to the extent
that any lack of effect, non-compliance or attack or revocation of a Necessary
Authorisation would not have or be reasonably likely to have a Material Adverse
Effect.

 

15.7                        Material Contracts

 

(a)                                  Each Material Contract to which any member of the
Borrower Group is a party constitutes, or will when executed constitute, the
legal, valid and binding obligation of such member, subject to the application
of any relevant insolvency, bankruptcy or similar laws or other laws affecting
the interests of creditors generally, enforceable against it in accordance with
its terms.

 

(b)                                 No member of the Borrower Group is in breach of any of
its material obligations under any Material Contract to which such member is a
party, nor (to the best of its knowledge and belief), is any other party
thereto, in each case in such a manner or to such an extent as would or is
reasonably likely to have a Material Adverse Effect.  To the best of its knowledge and belief there is no material
dispute between any member of the Borrower Group and any other party to a
Material Contract and there have been no amendments to any Material Contract in
the form provided to the Facility Agent prior to the date of this Agreement
which would or is reasonably likely to have a Material Adverse Effect.

 

15.8                        No default

 

(a)                                  No Event of Default has occurred and is continuing or
will result from the making of any Advance.

 

(b)                                 None of it or any other member of the Borrower Group
is in default under any law, regulation or agreement to which it is subject,
except for a default which will not have or be reasonably likely to have a
Material Adverse Effect.

 

73

 

15.9                        Accounts

 

The consolidated
financial statements of it and the Borrower Group most recently delivered to
the Facility Agent (which, at the date of this Agreement are the Original
Borrower Group Financial Statements):

 

(a)                                  present a true and fair view of (in the case of
audited financial statements) or fairly present (in the case of unaudited
financial statements) its financial position and the consolidated financial
position of the Borrower Group respectively as at the date to which they were
drawn up; and

 

(b)                                 have been prepared in all material respects in
accordance with GAAP (except that such consolidated financial statements do not
include all consolidated Subsidiaries to the extent they are Unrestricted
Subsidiaries).

 

15.10                 Financial condition

 

There has been
no material adverse change in the consolidated financial position of the
Borrower Group (taken as a whole) since the date of the Original Borrower Group
Financial Statements which would or is reasonably likely to have a Material
Adverse Effect.

 

15.11                 Environmental

 

(a)                                  It and each other member of the Borrower Group (i)
have obtained all requisite Environmental Licences required for the carrying on
of its business as currently conducted and (ii) have at all times complied with
the terms and conditions of such Environmental Licences and (iii) have at all
times complied with all other applicable Environmental Law, which in each such
case, if not obtained or complied with, would or is reasonably likely to have a
Material Adverse Effect.

 

(b)                                 There is no Environmental Claim in existence, pending
or, to the best of its knowledge, threatened, against it which is reasonably
likely to be decided against it and which, if so decided, would or is
reasonably likely to have a Material Adverse Effect.

 

(c)                                  So far as it is aware, no Dangerous Substance has been
used, disposed of, generated, stored, transported, dumped, released, deposited,
buried or emitted at, on, from or under any premises (whether or not owned,
leased, occupied or controlled by it or any member of the Borrower Group and
including any offsite waste management or disposal location utilised by it or
any member of the Borrower Group) in circumstances where this would be
reasonably likely to result in a liability on it which would or is reasonably
likely to have a Material Adverse Effect.

 

15.12                 Security Interests

 

Its execution
and delivery of this Agreement does not necessitate and will not result in the
creation or imposition of any Security Interest over any of its material assets
or those of any member of the Borrower Group (except for any Security Interest
created pursuant to the Security Documents).

 

15.13                 Litigation and insolvency proceedings

 

(a)                                  No litigation, arbitration or administrative
proceedings of or before any court, arbitral body or agency have been started
against any member of the Borrower Group and, to its knowledge, no such
proceedings are threatened, where in any such case, there is a reasonable
likelihood

 

74

 

of an adverse
outcome to any member of the Borrower Group where that outcome is of a nature
which would or is reasonably likely to have a Material Adverse Effect.

 

(b)                                 None of the circumstances referred to in Clause 18.7
(Insolvency proceedings) are pending or, to its knowledge, threatened against
it or any member of the Borrower Group which is a Material Subsidiary.

 

15.14                 Business Plan

 

To the best of
its knowledge after due inquiry, as of the date of the Business Plan:

 

(a)                                  the factual information relating to the Borrower Group
contained in the Business Plan is accurate in all material respects;

 

(b)                                 all UPC Distribution’s projections and forecasts
contained in the Business Plan were based on and arrived at after due and
careful consideration and have been prepared by UPC Distribution on the basis
of assumptions that UPC Distribution believed were reasonable as of the date of
the projections;

 

(c)                                  there are no material facts or circumstances which
have not been disclosed to the Lenders in writing prior to the date of the
Business Plan and which would make any material factual information referred to
in (a) above untrue, inaccurate or misleading in any material respect as at the
date of the Business Plan, or any such opinions, projections, or assumptions
referred to in (b) above misleading in any material respect as at the date of
the Business Plan.

 

15.15                 Tax liabilities

 

(a)                                  No claims are being asserted against it or any member
of the Borrower Group with respect to Taxes which are reasonably likely to be
determined adversely to it or to such member and which, if so adversely
determined, would or is reasonably likely to have a Material Adverse
Effect.  It is not materially overdue in
the filing of any Tax returns required to be filed by it (where such late
filing might result in any material fine or penalty on it) and it has paid
within any period required by law all Taxes shown to be due on any Tax returns
required to be filed by it or on any assessments made against it (other than
Tax liabilities being contested by it in good faith and where it has made
adequate reserves for such liabilities or where such overdue filing, or
non-payment, or a claim for payment, of which in each such case would not have
or be reasonably likely to have a Material Adverse Effect).

 

(b)                                 Each Obligor (other than UPC Financing) is part of the
same fiscal unity for Dutch corporate income tax purposes.  UPC Financing is transparent for Dutch
corporate income tax purposes and all of the partners in UPC Financing are part
of the fiscal unity for Dutch corporate income tax purposes as all of the other
Obligors.

 

15.16                 Ownership of assets

 

It and each
member of the Borrower Group has good title to or valid leases or licences of
or is otherwise entitled to use all assets necessary to conduct its business,
except where the failure to do so would not have or be reasonably likely to
have a Material Adverse Effect.

 

75

 

15.17                 Intellectual Property Rights

 

(a)                                  It (and each member of the Borrower Group) owns or has
the legal right to use all the Intellectual Property Rights which are required
for the conduct of the business of the Borrower Group as a whole from time to
time or are required by it (or such member) in order for it to carry on such
business as it is then being conducted, except where the failure to do so would
not have or be reasonably likely to have a Material Adverse Effect.  As far as it is aware it does not (nor does
any member of the Borrower Group), in carrying on its business, infringe any
Intellectual Property Rights of any third party in any way which would or is
reasonably likely to have a Material Adverse Effect.

 

(b)                                 None of the Intellectual Property Rights owned by any
member of the Borrower Group is, to its knowledge, being infringed nor, to its
knowledge, is there any threatened infringement of those Intellectual Property
Rights, by any third party which, in either case, would or is reasonably likely
to have a Material Adverse Effect.

 

(c)                                  All registered Intellectual Property Rights owned by
it (or any member of the Borrower Group) are subsisting and all actions
(including payment of all fees) required to maintain the same in full force and
effect have been taken except where the absence of such rights or the failure
to take any such action would not have or be reasonably likely to have a
Material Adverse Effect.

 

15.18                 Works councils

 

All of the
requirements of Section 25 of The Netherlands Works Council Act (Wet op de Ondernemingsraden) in connection
with the transactions contemplated by the Finance Documents which are
applicable to an Obligor have been complied with by that Obligor.

 

15.19                 Borrower Group structure

 

Schedule 8
(Borrower Group Structure) sets out a description which is true and complete in
all material respects as at the Effective Date of the corporate ownership
structure of the Borrower Group and of the ownership of the Borrower (but does
not describe any level of ownership above UGCE Inc.).

 

15.20                 ERISA

 

Neither it nor
any member of the Borrower Group or ERISA Affiliate maintains, contributes to
or has any obligation to contribute to or any liability under, any Plan, or in
the past five years has maintained or contributed to or had any obligation to,
or liability under, any Plan.

 

15.21                 United States Regulations

 

Neither it nor
any member of the Borrower Group is:

 

(a)                                  a holding company as defined in the United States
Public Utility Holding Company Act of 1935 or subject to regulation thereunder;

 

(b)                                 a public utility as defined in the United States
Federal Power Act of 1920; or subject to regulation thereunder;

 

(c)                                  required to be registered as an investment company as
defined in the United States Investment Company Act of 1940 or subject to regulation
thereunder; or

 

76

 

(d)                                 subject to regulation under any United States Federal
or State law or regulation that limits its ability to incur or guarantee
indebtedness.

 

15.22                 Anti-Terrorism Laws

 

To the best of
its knowledge, neither it nor any member of the Borrower Group:

 

(a)                                  is, or is controlled by, a Designated Party;

 

(b)                                 has received funds or other property from a Designated
Party; or

 

(c)                                  is in material breach of or is the subject of any
action or investigation under any Anti-Terrorism Law

 

It and each of
its Affiliates have taken commercially reasonable measures to ensure compliance
with the Anti-Terrorism Laws.

 

15.23                 Margin stock

 

(a)                                  (In the case of the Borrowers only) the proceeds of
the Facilities have been and will be used only for the purposes described in
Clause 3 (Purpose).

 

(b)                                 Neither it nor any member of the Borrower Group is
engaged principally in the business of extending credit for the purpose of
purchasing or carrying margin stock (within the meaning of Regulations U and X
of the Board of Governors of the United States Federal Reserve System), and no
portion of any Advance has been or will be used, directly or indirectly, to
purchase or carry margin stock or to extend credit to others for the purpose of
purchasing or carrying margin stock.

 

15.24                 UPC Financing

 

UPC Financing
did not trade or carry on any business from the date it was formed up to and
including 26th October, 2000 except for investment in or proposed investment in
other members of the Borrower Group by way of intercompany loan or subscription
of shares.

 

15.25                 Dutch Banking Act

 

On the Effective
Date:

 

(a)                                  UPC Distribution is in compliance with the applicable
provisions of the Dutch Banking Act and any implementing regulations; and

 

(b)                                 UPC Distribution has verified, by obtaining a duly
completed and executed Verification Letter, the status of each person which is
a Lender under this Agreement either as:

 

(i)                                     a Professional Market Party; or

 

(ii)                                  exempted from the requirement to be a Professional
Market Party because it forms part of a closed circle (besloten kring) with UPC Distribution.

 

77

 

15.26                 Investment Company Act

 

Neither it nor
any member of the Borrower Group is an “investment company” or a company
“controlled” by an “investment company”, within the meaning of the United
States Investment Company Act of 1940, as amended.

 

15.27                 Public Utility Holding Company Act and Federal Power
Act

 

Neither it nor
any member of the Borrower Group is a “holding company”, or an “affiliate” of a
“holding company” or a “subsidiary company” of a “holding company”, within the
meaning of, or otherwise subject to regulation under, the United States Public
Utility Holding Company Act of 1935, as amended.  Neither it nor any member of the Borrower Group is a “public
utility” within the meaning of, or otherwise subject to regulation under, the
United States Federal Power Act.

 

15.28                 Times for making representations and warranties

 

(a)                                  The representations and warranties set out in this
Clause 15 (Representations and Warranties) are made by each Obligor on the
Signing Date (except for Clause 15.25 (Dutch Banking Act) which shall be made
on the Effective Date) and (except for Clauses 15.6(a) (Consents), 15.10
(Financial condition), 15.12 (Security Interests), 15.13(b) (Litigation and
insolvency proceedings), 15.14 (Business Plan), 15.15 (Tax liabilities), 15.16
(Ownership of assets), 15.18 (Works councils), 15.19 (Borrower Group
structure), 15.20 (ERISA), 15.24 (UPC Financing) and 15.25 (Dutch Banking Act))
are deemed to be made again by each relevant Obligor on the date of each
Request, the first day of each Interest Period and on each Utilisation Date
with reference to the facts and circumstances then existing.

 

(b)                                 The representations and warranties set out in this
Clause 15 (Representations and Warranties) (except Clauses 15.9 (Accounts),
15.10 (Financial condition), 15.14 (Business Plan), 15.19 (Borrower Group
structure) and 15.24 (UPC Financing)) are repeated by each Additional Obligor
with respect to itself on the date of the Obligor Accession Agreement relating
to that Additional Obligor, with reference to the facts and circumstances then
subsisting.

 

(c)                                  The representation and warranty made by UPC
Distribution in Clause 15.14 (Business Plan) will be deemed to be repeated on
the date any updated Business Plan is delivered to the Facility Agent by UPC
Distribution, but only in respect of that updated Business Plan, by reference
to the facts and circumstances existing on the relevant date.

 

16.                               UNDERTAKINGS

 

16.1                        Duration

 

The undertakings
in this Clause 16 (Undertakings) will remain in force from the Signing Date for
so long as any amount is or may be outstanding under any Finance Document or
any Commitment is in force.

 

16.2                        Financial information

 

UPC Distribution
shall supply to the Facility Agent in sufficient copies for all the Lenders:

 

(a)                                  as soon as the same are available (and in any event
within 150 days of the end of each of its financial years) its audited
consolidated financial statements for that financial year;

 

78

 

(b)                                 as soon as the same are available (and, in any event,
(in the case of its first three financial quarters in any financial year)
within 60 days of the end of each of its financial quarters and (in the case of
its fourth financial quarter in each financial year) within 150 days of the end
of each such financial quarter), its unaudited quarterly consolidated
management accounts for that financial quarter in the agreed form;

 

(c)                                  by no later than 60 days after the last day of each of
its financial years, an annual budget for the Distribution Business of the
Borrower Group in the agreed form for the immediately following financial year;

 

(d)                                 together with any financial statements specified in
paragraphs (a) or (b) above, a certificate signed by a director of UPC
Distribution:

 

(i)                                     confirming that no Default is outstanding or if a
Default is outstanding, specifying the Default and the steps, if any, being
taken to remedy it;

 

(ii)                                  setting out in reasonable detail computations
establishing, as at the date of such financial statements, whether each of the
financial ratios set out in Clause 17 (Financial Covenants) were complied with;

 

(iii)                               (in the case of financial statements specified in
paragraph (a) above, starting with the annual financial statements for 31st
December, 2004) setting out in reasonable detail computations establishing the
Excess Cash Flow (if any) for the financial year to which such financial
statements were delivered for the purposes of Clause 7.5 (Mandatory prepayment
from Excess Cash Flow and Net Equity Proceeds);

 

(iv)                              certifying current compliance with the Borrowers’
obligations under Clause 7.6(a)(i) (Prepayment from disposal proceeds); and

 

(v)                                 certifying compliance with Clause 16.11(a) and (b)
(Acquisitions and mergers) and setting out in reasonable detail the amount of
the Acquisition Cost of all Acquisitions made by the Borrower Group since the
Signing Date (excluding, at UPC Distribution’s option, the value of any
consideration referred to in paragraph (a) of the definition of “Acquisition
Cost” in respect of such Acquisition which has yet to be paid or delivered) and
whether any such Acquisition Cost has been directly or indirectly funded by the
proceeds of equity or Subordinated Shareholder Loans as described in paragraph
(c) of the definition of “Permitted Acquisition” and paragraph (b) of the
definition of “Permitted Joint Venture” respectively;

 

(e)                                  as soon as the same is available (and in any event
within 90 days after each of its financial quarters) the consolidated financial
statements of UGCE Inc. for that financial quarter on Form 10Q as filed with
the United States Securities and Exchange Commission (the Commission) or such other comparable form
as UGCE Inc. is required to file with the Commission under the United States
Securities Exchange Act of 1934 (the 1934 Act)
or, if UGCE Inc. is no longer subject to the reporting requirements of the 1934
Act, in the form required to be filed with the regulatory body comparable to
the Commission then having jurisdiction over UGCE Inc.;

 

(f)                                    as soon as the same is available (and in any event
within 180 days after each of its financial years) the audited consolidated
financial statements of UGCE Inc. for that financial year on Form 10K as filed
with the Commission or such other comparable

 

79

 

form as UGCE Inc. is required to file with the Commission under the 1934
Act or, if UGCE Inc. is no longer subject to the reporting requirements of the
1934 Act, in the form required to be filed with the regulatory body comparable
to the Commission then having jurisdiction over UGCE Inc.; and

 

(g)                                 together with the financial statements and accounts
referred to in paragraphs (a) and (b), a reconciliation demonstrating the
effect of excluding from such financial statements or accounts the results of
any business or activity other than the Distribution Business of the Borrower
Group, provided that non-Distribution Business Assets need not be so excluded
(and the reconciliation need not apply to such assets) unless they are subject
to any Security Interest referred to in paragraph (i) of the definition of
“Permitted Security Interest” or any other form of recourse as contemplated by
Clause 16.12(b)(xii) (Restrictions on Financial Indebtedness).

 

16.3                        Information - Miscellaneous

 

UPC Distribution
shall supply promptly (and in any event in the case of paragraph (d) below
within five Business Days of the date on which UPC Distribution becomes aware
of such information) or procure that there shall be supplied (both in hard copy
and in electronic form) promptly to the Facility Agent:

 

(a)                                  all notices, reports or other documents despatched by
or on behalf of any Obligor to its creditors generally in relation to it or any
of its Subsidiaries;

 

(b)                                 a copy of any material report or other notice,
statement or circular, sent or delivered by any member of the Borrower Group
whose shares are pledged to the Security Agent pursuant to any Security
Document to any person in its capacity as shareholder of such member of the
Borrower Group, which materially adversely affects the interest of the Finance
Parties under such Security Document;

 

(c)                                  such other material information regarding the Borrower
Group and which is in the possession or control of any member of the Borrower
Group as the Facility Agent may from time to time reasonably request; and

 

(d)                                 written notification of:

 

(i)                                     any or all of the Priority Pledge and/or the Derby and
EPG Share Pledges becoming enforceable;

 

(ii)                                  any breach by UPC, UPC Exploitation II B.V., UPC
Exploitation Holding B.V. or Priority Telecom N.V. of its obligations set out
in the Priority Pledge and/or the Derby and EPG Share Pledges;

 

(iii)                               any breach of the Derby and EPG Agreements; and

 

(iv)                              any breach of the Sale and Purchase Agreements.

 

16.3A               Enforcement of and undertakings in
relation to certain agreements

 

(a)                                  UPC Distribution agrees promptly after (and in any event
within five Business Days of) receiving notice from the Facility Agent to do
so, to take all necessary action to:

 

(i)                                     if any or all of the Priority Pledge and/or the Derby
and EPG Share Pledges become enforceable, enforce any or all of them;

 

80

 

(ii)                                  if UPC, UPC Exploitation II B.V., UPC Exploitation
Holding B.V. or Priority Telecom N.V. has breached its obligations set out in
all or any of the Priority Pledge and/or the Derby and EPG Share Pledges in any
material respect or if any party is in breach of either of the Derby and EPG
Agreements in any material respect, enforce its rights in respect of any such
breaches by UPC, UPC Exploitation II B.V., UPC Exploitation Holding B.V. or
Priority Telecom N.V. of their respective obligations under such agreements;
and

 

(iii)                               if any party to the Sale and Purchase Agreements is in
default under any one or more of the Sale and Purchase Agreements in any
material respect, enforce its rights in respect of such default.

 

(b)                                 UPC Distribution undertakes to keep the Lenders
informed and to take such action in connection with the enforcement of the
Priority Pledge and/or the Derby and EPG Share Pledges or its rights under the
Priority Pledge and/or the Derby and EPG Share Pledges, the Derby and EPG
Agreements or any of the Sale and Purchase Agreements (as the case may be) as
may be requested by the Facility Agent (acting on the instructions of the
Majority Lenders).

 

(c)                                  UPC Distribution undertakes not to:

 

(i)                                     agree to any amendment, variation, supplement or
waiver of the Priority Pledge and/or the Derby and EPG Share Pledges, the Derby
and EPG Agreements or the Sale and Purchase Agreements;

 

(ii)                                  enter into any arrangements with UPC Exploitation
Holding B.V. or UPC Exploitation II B.V. other than the Priority Pledge and/or
the Derby and EPG Share Pledges, the Derby and EPG Agreements or any of the
Sale and Purchase Agreements; or

 

(iii)                               enter into any arrangements with UPC, UPC Exploitation
Holding B.V. or UPC Exploitation II B.V. in relation to the derby billing
system or electronic programming guide software that will prejudice UPC
Distribution’s rights to use and operate the derby billing system and/or the
electronic programming guide software,

 

without the
written consent of the Facility Agent (acting on the instructions of the
Majority Lenders) where the same would prejudice in any material respect the
interests of the Lenders under such arrangements.

 

16.4                        Notification of Default and
inspection rights

 

(a)                                  Each Obligor shall notify the Facility Agent of any
Default (and the steps, if any, being taken to remedy it) promptly upon
becoming aware of it (unless that Obligor is aware that such a notification has
already been provided by another Obligor).

 

(b)                                 Each Obligor (other than UPC Distribution Holdco)
shall, if required by the Facility Agent (acting on the instructions of the
Majority Lenders), at any time whilst an Event of Default is continuing or the
Facility Agent has reasonable grounds to believe that an Event of Default may
exist and at other times if the Facility Agent has reasonable grounds for such
request, permit representatives of the Facility Agent upon reasonable prior
written notice to UPC Distribution to:

 

(i)                                     visit and inspect the properties of any member of the
Borrower Group during normal business hours;

 

81

 

(ii)                                  inspect its books and records other than records which
the relevant member of the Borrower Group is prohibited by law, regulation or
contract from disclosing to the Facility Agent; and

 

(iii)                               discuss with its principal officers and Auditors its
business, assets, liabilities, financial position, results of operations and
business prospects provided that (A) any such discussion with the Auditors shall
only be on the basis of the audited financial statements of the Borrower Group
and any compliance certificates issued by the Auditors and (B) representatives
of UPC Distribution shall be entitled to be present at any such discussion with
the Auditors.

 

(c)                                  Any Obligor must promptly upon becoming aware of it
notify the Facility Agent of:

 

(i)                                     any Reportable Event;

 

(ii)                                  the termination of or withdrawal from, or any
circumstances reasonably likely to result in the termination of or withdrawal
from, any Plan subject to Title IV of ERISA; and

 

(iii)                               material non-compliance with any law or regulation
relating to any Plan which would or is reasonably likely to have a Material
Adverse Effect.

 

16.5                        Authorisations

 

Each Obligor
(other than UPC Distribution Holdco, in the case of paragraphs (b) and (c)
below) will, and will procure that each of its Subsidiaries which is a member
of the Borrower Group will:

 

(a)                                  obtain or cause to be obtained, maintain and comply
with the terms of:

 

(i)                                     every material consent, authorisation, licence or
approval of, or filing or registration with or declaration to, governmental or
public bodies or authorities or courts; and

 

(ii)                                  every material notarisation, filing, recording,
registration or enrolment in any court or public office,

 

in each case
required under any law or regulation to enable it to perform its obligations
under, or for the validity, enforceability or admissibility in evidence of any
Finance Document to which it is a party; and

 

(b)                                 obtain or cause to be obtained every Necessary
Authorisation and the Licences and ensure that (i) none of the Necessary
Authorisations or Licences is revoked, cancelled, suspended, withdrawn,
terminated, expires and is not renewed or otherwise ceases to be in full force
and effect and (ii) no Necessary Authorisation or Licence is modified and no
member of the Borrower Group commits any breach of the terms or conditions of
any Necessary Authorisation or Licence which, in each case, would or is
reasonably likely to have a Material Adverse Effect.

 

16.6                        Pari passu ranking

 

Each Obligor
will procure that its payment obligations under the Finance Documents do and
will rank at least pari passu
with all the claims of its other present and future unsecured and

 

82

 

unsubordinated
creditors (save for those obligations mandatorily preferred by applicable law
applying to companies generally).

 

16.7                        Negative pledge

 

(a)                                  Each Obligor (other than UPC Distribution Holdco) will
not permit any Security Interest (other than the Permitted Security Interests)
by any member of the Borrower Group to subsist, arise or be created or extended
over all or any part of their respective present or future undertakings,
assets, rights or revenues to secure or prefer any present or future
indebtedness of any member of the Borrower Group or any other person.

 

(b)                                 UPC Distribution Holdco will not create or permit to
subsist any Security Interest over its assets which are subject to the Security
Documents to which it is a party (other than any Permitted Security Interest
referred to in paragraphs (a), (b), (d), (e) or (g) of the definition of
“Permitted Security Interest”).

 

(c)                                  (i)                                     UPC Distribution will procure that none of Belmarken,
UPC, UGCE Inc. or any other member of the UGCE Borrower Group (each a Relevant Company) will create or permit to
subsist any Security Interest (other than an Agreed Security Interest) over all
or part of that Relevant Company’s present or future undertakings, assets,
rights or revenues.

 

(ii)                                  For the purposes of sub-paragraph (c)(i) above:

 

Agreed
Security Interest means:

 

(A)                              any liens arising in the ordinary course of business
by way of contract which secure indebtedness under any agreement for the supply
of goods or services in respect of which payment is not deferred for more than
180 days (or 360 days if such deferral is in accordance with the terms pursuant
to which the relevant goods were acquired or services were provided);

 

(B)                                any Security Interest imposed by any taxation or
governmental authority in respect of amounts which are being contested in good
faith and not yet payable and for which adequate reserves have been set aside
in the accounts of the Relevant Company in respect of the same in accordance
with GAAP;

 

(C)                                any Security Interest in favour of any bank incurred
in relation to any cash management arrangements;

 

(D)                               rights of set-off arising in the ordinary course of
business;

 

(E)                                 any Security Interest granted by a Relevant Company
over its shareholding in any of its Subsidiaries which is not itself a Relevant
Company;

 

(F)                                 any Security Interest granted by a Relevant Company
under any Existing Security Documents provided that, (other than in the case of
the Security Interests referred to in paragraph (a) of the definition of
“Existing Security Documents”) at the same time that such Security Interest is
granted, the Relevant Company grants an identical Security Interest over the
same assets to the Beneficiaries and under the terms of the Intercreditor
Agreement, such Security Interest ranks pari
passu with the Security Interest(s) arising under the corresponding
Security Document which purports to create a Security Interest over the same
property, assets or rights provided that any such Existing Security Document
will be in the same form as the corresponding

 

83

 

Security
Document (save for changes directly attributable to the identity of the parties
and the loan amounts);

 

(G)                                any Security Interest granted by a Relevant Party to
secure any Third Party Debt permitted under Clause 16.12(d) (Restrictions on
Financial Indebtedness); and

 

(H)                               any Security Interest not falling within
sub-paragraphs (A) to (G) above securing any indebtedness which, when
aggregated with all other indebtedness secured by that Relevant Company and
each other Relevant Company, does not exceed €15,000,000 (or its equivalent).

 

16.8                        Permitted Business

 

(a)                                  Each Obligor will ensure that it and its Subsidiaries
which are members of the Borrower Group (other than any Relevant Eastern European
Subsidiary) engage:

 

(i)                                     in no material activity outside the Permitted
Business; and/or

 

(ii)                                  in the business of acting as the holder of shares
and/or interests in other members of the Borrower Group (which shall include
the raising of Permitted Financial Indebtedness and the on-lending of such
Financial Indebtedness to its Subsidiaries in accordance with the provisions of
this Agreement and the entry into of hedging arrangements on behalf of its
Subsidiaries).

 

(b)                                 The Borrowers will ensure that UPC Financing will
engage primarily in the business of a finance company for and in respect of the
Borrower Group in connection with the Existing Facilities and the transactions
contemplated by the Existing Facility Agreement.

 

16.9                        Compliance with laws

 

Each Obligor
will, and will procure that each of its Subsidiaries which is a member of the
Borrower Group will, comply in all material respects with all applicable laws,
rules, regulations and orders of any governmental authority, having
jurisdiction over it or any of its assets, except where failure to comply with
which would not have or be reasonably likely to have a Material Adverse Effect.

 

16.10                 Disposals

 

(a)                                  Each Obligor (other than UPC Distribution Holdco) will
not and will procure that no other member of the Borrower Group (other than a
Relevant Eastern European Subsidiary) will, sell, transfer, lend (subject to
Clause 16.14 (Loans and guarantees)) or otherwise dispose of or cease to
exercise direct control over (each a disposal)
any part of its present or future undertaking, assets, rights or revenues
whether by one or a series of transactions related or not (other than Permitted
Disposals).

 

(b)                                 As used herein a Permitted
Disposal means:

 

(i)                                     disposals (including, for the avoidance of doubt, the
outsourcing of activities that support or are incidental to the Permitted
Business) on arm’s length commercial terms in the ordinary course of business;

 

(ii)                                  the disposal of property or other assets on bona fide
arm’s length commercial terms in the ordinary course of business in
consideration for, or to the extent that the net proceeds of disposal are
applied within 120 days after such disposal in the acquisition

 

84

 

of, property or
other assets of a similar nature and approximately equal value to be used in
the Permitted Business;

 

(iii)                               disposals of assets on bona fide arm’s length
commercial terms where such assets are obsolete or no longer required for the
purposes of the Permitted Business;

 

(iv)                              the application of cash in payments which are not
otherwise restricted by the terms of this Agreement and the Security Documents
including, for the avoidance of doubt, Permitted Acquisitions and Permitted
Payments;

 

(v)                                 disposals (or the payment of management, consultancy
or similar fees):

 

(A)                              by an Obligor to another Obligor; or

 

(B)                                from a member of the Borrower Group which is not an
Obligor, to any member of the Borrower Group; or

 

(C)                                from an Obligor to another member of the Borrower
Group which is not an Obligor;

 

(vi)                              disposals of any interest in an Unrestricted
Subsidiary;

 

(vii)                           disposals made in connection with Approved Stock
Options;

 

(viii)                        disposals of assets (in addition to those described in
sub-paragraphs (i) to (viii) above), comprising or contributing in aggregate a
percentage value (as determined in accordance with Clause 7.6(b) (Prepayment
from disposal proceeds)) of five per cent. or less (adjusted in accordance with
Clause 7.6(a) (Mandatory prepayment from disposal proceeds)) of the total
assets, revenues and EBITDA of the Borrower Group provided that no Default has
occurred and is continuing or would occur as a result of such disposal;

 

(ix)                                disposals of undertakings, assets, rights or revenues
comprising interests in the share capital of persons not holding or engaged in
the Distribution Business of the Borrower Group or other undertakings, assets,
rights or revenues not constituting part of the Distribution Business of the
Borrower Group (non-Distribution Business
Assets);

 

(x)                                   payment, transfer or other disposal of consideration
for any Acquisition, merger or consolidation permitted by Clause 16.11
(Acquisitions and mergers);

 

(xi)                                disposals of cash or cash equivalents constituting any
distribution, dividend, transfer, loan or other transaction permitted by Clause
16.13 (Restricted Payments); and

 

(xii)                             the grant of indefeasible rights of use or equivalent
arrangements with respect to network capacity, communications, fibre capacity
or conduit, in each case on arm’s length commercial terms or on terms that are
fair and reasonable and in the best interests of the Borrower Group.

 

For the
avoidance of doubt and without limiting the generality of sub-paragraph (x)
above, non-Distribution Business Assets shall include:

 

(A)                              undertakings, assets, rights and revenues comprising
interests in the share capital of any person engaged solely in the competitive
local exchange carrier

 

85

 

(CLEC) business,
including without limitation, the business of providing traditional voice and
data services and services based on Transmission Control Protocol/Internet
Protocol (TCP/IP) technology and other undertakings, assets, rights or revenues
constituting a part of such businesses; and

 

(B)                                undertakings, assets, rights and revenues comprising
interests in the share capital of any person engaged solely in the business of
television and radio programming, including without limitation, the business or
creating and distributing special interest television channels, radio programmes,
pay per view programmes and near video on demand services and other
undertakings, assets, rights or revenues constituting a part of such
businesses.

 

(c)                                  Except as otherwise expressly permitted in this
Agreement or the relevant Security Document, UPC Distribution Holdco will not
sell, transfer, lease or otherwise dispose of all or any part of its assets
which are subject to a Security Document to which it is a party.

 

16.11                 Acquisitions and mergers

 

(a)                                  No Obligor (other than UPC Distribution Holdco) will,
and each Obligor (other than UPC Distribution Holdco) will procure that none of
its Subsidiaries which is a member of the Borrower Group will, make any
Acquisition, other than:

 

(i)                                     any Acquisition approved in writing by the Majority
Lenders;

 

(ii)                                  any Permitted Acquisition;

 

(iii)                               any Permitted Joint Venture; or

 

(iv)                              any Acquisition from any person which is a member of
the Borrower Group or subscription of an interest in the share capital (or
equivalent) in any person which is a member of the Borrower Group.

 

(b)                                 No Obligor (other than UPC Distribution Holdco) will,
and each Obligor (other than UPC Distribution Holdco) will procure that none of
its Subsidiaries which is a member of the Borrower Group will, pay or deliver
any consideration referred to in paragraph (a) of the definition of
“Acquisition Cost” in connection with a Permitted Acquisition or Permitted
Joint Venture made by it if and to the extent that the aggregate of:

 

(i)                                     such deferred consideration; and

 

(ii)                                  the Acquisition Cost of all other Acquisitions made by
the Borrower Group since the Signing Date,

 

would cause the
relevant Acquisition to cease to be a Permitted Acquisition or, as the case may
be, a Permitted Joint Venture.

 

(c)                                  [Intentionally left blank]

 

(d)                                 Each Obligor (other than UPC Distribution Holdco) will
not merge or consolidate with any other company or person and will procure that
no member of the Borrower Group will merge or consolidate with any other
company or person (other than, in each case, in connection with the Romania
Restructuring) save for:

 

86

 

(i)                                     Acquisitions permitted by paragraphs (a) and (b) above
and disposals permitted by Clause 16.10 (Disposals); or

 

(ii)                                  with the prior written consent of the Facility Agent
(acting on the instructions of the Majority Lenders); or

 

(iii)                               mergers between any member of the Borrower Group with
(I) any or all of the other members of the Borrower Group or (II) an
Unrestricted Subsidiary (Original Entities),
into one or more entities (each a Merged
Entity) provided that:

 

(A)                              reasonable details of the proposed merger in order to
demonstrate satisfaction with sub-paragraphs (C) to (G) below are provided to
the Facility Agent at least 10 days before the merger is to be entered into;

 

(B)                                if the proposed merger is between a member of the
Borrower Group and an Unrestricted Subsidiary, UPC Distribution has delivered
to the Facility Agent financial projections based on assumptions which are no
more aggressive than those used in the preparation of the Business Plan which
demonstrate that the Borrower Group will be in compliance with the undertakings
set out in Clause 17.2 (Financial ratios) for the period commencing on the date
of merger and ending on the Final Maturity Date;

 

(C)                                such Merged Entity will be a member of the Borrower
Group and will be liable for the obligations of the relevant Original Entities
(including the obligations under this Agreement and the Security Documents),
which obligations remain unaffected by the merger, and entitled to the benefit
of all rights of such Original Entities;

 

(D)                               (if all or any part of the share capital of any of the
relevant Original Entities was charged pursuant to a Security Document) the
equivalent part of the issued share capital of such Merged Entity is charged
pursuant to a Security Document on terms of at least an equivalent nature and
equivalent ranking as any Security Document relating to the shares in each
relevant Original Entity;

 

(E)                                 such Merged Entity has entered into Security Documents
(if applicable) which provide security over the same assets of at least an
equivalent nature and ranking to the security provided by the relevant Original
Entities pursuant to any Security Documents entered into by them;

 

(F)                                 any possibility of the Security Documents referred to
in sub-paragraphs (D) or (E) above being challenged or set aside is not
materially greater than any such possibility in relation to the Security
Documents entered into by, or in respect of the share capital of, any relevant
Original Entity; and

 

(G)                                all the property and other assets of the relevant
Original Entities are vested in the Merged Entity and the Merged Entity has
assumed all the rights and obligations of the relevant Original Entities under
any relevant Material Contracts, material Necessary Authorisations and Licences
and other licences or registrations (to the extent reasonably necessary for the
business of the relevant Original Entities) granted in favour of the Original
Entities under Telecommunications and Cable Laws and/or all such rights and
obligations have been transferred to the Merged Entity and/or the relevant
Material Contracts, Necessary Authorisations and Licences and other licences or
registrations (to the extent reasonably necessary for the business of the

 

87

 

relevant
Original Entities) granted in favour of the Original Entities under
Telecommunications and Cable Laws have been reissued to the Merged Entity.

 

16.12                 Restrictions on Financial Indebtedness

 

(a)                                  Each Obligor (other than UPC Distribution Holdco) will
not, and will procure that no other member of the Borrower Group (other than a
Relevant Eastern European Subsidiary) will, create, incur or otherwise permit
to be outstanding any Financial Indebtedness (other than  Permitted Financial Indebtedness).

 

(b)                                 As used herein, Permitted
Financial Indebtedness means, without duplication:

 

(i)                                     any Financial Indebtedness arising hereunder or under
the Security Documents;

 

(ii)                                  any Financial Indebtedness arising under the Existing
Facility;

 

(iii)                               any Financial Indebtedness or guarantees permitted
pursuant to Clause 16.14 (Loans and guarantees);

 

(iv)                              any Financial Indebtedness incurred through a
Subordinated Shareholder Loan made to any member of the Borrower Group;

 

(v)                                 any Financial Indebtedness of any member of the
Borrower Group arising as a result of the issue by it or a financial
institution of a surety or performance bond in relation to the performance by
such member of the Borrower Group or its obligations under contracts entered
into in the ordinary course of its business (other than for the purpose of
raising finance);

 

(vi)                              any Financial Indebtedness approved in writing by the
Facility Agent (acting on the instructions of the Majority Lenders);

 

(vii)                           any Financial Indebtedness incurred in connection with
the Senior Hedging Agreements and any other hedging arrangements permitted by
Clause 16.17 (Hedging);

 

(viii)                        any deposits or prepayments constituting Financial
Indebtedness received by any member of the Borrower Group from a customer or
subscriber for its services;

 

(ix)                                any Financial Indebtedness owing by any member of the
Borrower Group being Management Fees or management, consultancy or similar fees
payable to another member of the Borrower Group in respect of which payment has
been deferred;

 

(x)                                   any Financial Indebtedness being Permitted Payments in
respect of which payment has been deferred;

 

(xi)                                any Financial Indebtedness of a company which is
acquired by a member of the Borrower Group after the date hereof as an
acquisition permitted by Clause 16.11 
(Acquisitions and mergers) where such Financial Indebtedness existed at
the date of completion of such Permitted Acquisition provided that (A) such
Financial Indebtedness was not incurred in contemplation of the acquisition,
(B) the amount of such Financial Indebtedness is not increased beyond the
amount in existence at the date of completion of the acquisition and (C) such
Financial Indebtedness is discharged within six months of the date of completion
of the acquisition;

 

88

 

(xii)                             any Financial Indebtedness of any member of the
Borrower Group, in respect of which the person or persons to whom such
Financial Indebtedness is or may be owed has or have no recourse whatever to
any member of the Borrower Group for any payment or repayment in respect
thereof other than recourse to such member of the Borrower Group 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 any member of
the Borrower Group over non-Distribution Business Assets, provided that:

 

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

 

(B)                                such person or persons are not entitled, pursuant to
the terms of any agreement evidencing any right or claim arising out of or in
connection with such Financial Indebtedness, to commence proceedings for the
winding up, dissolution or administration of any member of the Borrower Group
(or proceedings having an equivalent effect) or to appoint or procure the
appointment of any receiver, trustee or similar person or officer in respect of
any member of the Borrower Group or any of its assets (save only for the
non-Distribution Business Assets the subject of that Security Interest) until
after the Commitments have been reduced to zero and all amounts outstanding
under the Finance Documents have been repaid or paid in full; and

 

(C)                                the aggregate outstanding amount of all such Financial
Indebtedness of all members of the Borrower Group does not exceed €100,000,000
(or its equivalent in other currencies);

 

(xiii)                          any Financial Indebtedness of any member of the
Borrower Group (other than any Obligor) constituting Financial Indebtedness to
all the holders (or their Associated Companies) of the share capital of any
such member of the Borrower Group on a basis that is substantially
proportionate to their interests in such share capital (with any disproportionately
large interest received by any member of the Borrower Group or any
disproportionately small interest received by any person other than a member of
the Borrower Group, in each case relative to its interests in such share
capital, being ignored for this purpose), provided such Financial Indebtedness
does not bear interest (other than by way of addition to its principal amount
on a proportionate basis as described above) and is made on terms that
repayment or pre-payment of such Financial Indebtedness shall only be made to
each such holder (A) in proportion to their respective interests in such share
capital (ignoring any disproportionately large interest held by any member of
the Borrower Group or any disproportionately small interest received by any
person other than a member of the Borrower Group, in each case relative to its
interests in such share capital, for this purpose) and (B) only on and in
connection with the liquidation or winding up (or equivalent) of such member of
the Borrower Group; and

 

(xiv)                         any other Financial Indebtedness in addition to the
Financial Indebtedness falling within paragraphs (i) to (xiii) above not
exceeding at any time more than €25,000,000 in aggregate (or its equivalent)
provided that such Financial Indebtedness is not indebtedness incurred in
respect of Acquisitions.

 

(c)                                  No Obligor will, and each Obligor will procure that
none of its Subsidiaries which is a member of the Borrower Group will, incur or
have outstanding any Financial Indebtedness due to or for the benefit of  UPC or any Subsidiary of UPC (not being a
member of the

 

89

 

Borrower Group),
other than Subordinated Shareholder Loans and any Permitted Financial
Indebtedness referred to in Clause 16.12(b)(vi), (viii), (ix), (x) or (xii).

 

(d)                                 (i)                                     Subject to sub-paragraph (ii) below, UPC Distribution
will ensure that no member of the UGCE Borrower Group will incur any Third
Party Debt (other than any Third Party Debt subsisting prior to 28th September,
2002) unless:

 

(A)                              UPC Distribution prepays or procures the prepayment of
the Facilities in accordance with Clause 7.6A (Mandatory prepayment from Third
Party Debt proceeds); and

 

(B)                                such Third Party Debt will not become due and payable
until after the later of the Final Maturity Date and the last Final Repayment
Date (as defined in the Existing Facility Agreement).

 

(ii)                                  Sub-paragraph (d)(i) above shall not apply if:

 

(A)                              the most recently delivered financial statements
provided to the Facility Agent under Clause 16.2(b) (Financial information)
show that, for the two most recent Ratio Periods, the applicable ratio for the
purposes of Clause 17.2(a) (Financial ratios) is 3.5:1 or less; or

 

(B)                                the principal amount of such Third Party Debt, when
aggregated with (I) any other Third Party Debt incurred by that member of the
UGCE Borrower Group after 28th September, 2002, and (II) any Third Party Debt
incurred by any other member of the UGCE Borrower Group after 28th September,
2002, is equal to or less than €15,000,000.

 

16.13                 Restricted Payments

 

(a)                                  Except for any payment or transfer of consideration
for the transfer of shares or receivables to a member of the Borrower Group
pursuant to the Restructuring, each Obligor (other than UPC Distribution
Holdco) will not, and will procure that no member of the Borrower Group will,
make any Restricted Payments other than Permitted Payments or enter into any
transaction with a Restricted Person other than on bona fide arm’s length
commercial terms or on terms which are fair and reasonable and in the best
interests of the Borrower Group.

 

(b)                                 As used herein, a Restricted
Payment means, in each case whether in cash, securities, property or
otherwise:

 

(i)                                     any direct or indirect distribution, dividend or other
payment on account of any class of its share capital or capital stock or other
securities;

 

(ii)                                  any payment of principal of, or interest on, any loan;
or

 

(iii)                               any transfer of assets, loan or other payment,

 

in the case of
each of (i), (ii) and (iii), to a Restricted Person.

 

(c)                                  As used herein, a Permitted
Payment means any distribution, dividend, transfer of assets, loan
or other payment:

 

(i)                                     to any Restricted Person in relation to transactions
carried out on bona fide arm’s length commercial terms in the ordinary course
of business or on terms which are fair

 

90

 

and reasonable
and in the best interests of the Borrower Group (including, but not limited to,
such transactions under Clause 16.21 (chello and Priority));

 

(ii)                                  by way of payment of Management Fees (A) which are
paid on bona fide arm’s length terms in the ordinary course of business to a
Restricted Person or (B) of up to €15,000,000 in any financial year provided
that, at the time of payment, no Default is subsisting or would occur as a
result of such payment;

 

(iii)                               by way of payment of interest on Subordinated
Shareholder Loans, provided that:

 

(A)                              such interest is applied ultimately in payment of (1)
all or any interest due in respect of Serviceable Subordinated Debt where all
or part of the proceeds of the corresponding Subordinated Shareholder Loans
have been applied in mandatory permanent prepayment of the Existing Facility or
Facility D; or (2) only the interest due in respect of that part of the
outstanding principal amount of any Serviceable Subordinated Debt which
corresponds to the amount of the proceeds of the corresponding Subordinated
Shareholder Loans which have been applied in permanent prepayment and
cancellation (other than a mandatory prepayment) of the Facility D or the
Existing Facility; or

 

(B)                                the then applicable ratio for the purposes of Clause
17.2(a) (Financial ratios) is 3.5:1 (or less),

 

and in each case
no Default has occurred and is continuing or would occur as a result of such
payment;

 

(iv)                              by way of distributions, dividends or other payments
paid by UPC Distribution in respect of its share capital or by way of repayment
or payment by UPC Distribution or the relevant member of the Borrower Group (as
the case may be) in respect of a Subordinated Shareholder Loan (each a Relevant Payment) but only to the extent
that UPC Distribution or the relevant member of the Borrower Group (as the case
may be) has either (A) received a corresponding distribution, dividend or other
payment from an Unrestricted Subsidiary or any other person in which UPC
Distribution has any interest that is not a member of the Borrower Group of at
least an equal amount to such Relevant Payment; or (B) the Relevant Payment is
made from the proceeds of sale or a disposal by UPC Distribution or the
relevant member of the Borrower Group (as the case may be) permitted by Clause
16.10(b)(vi) (Disposals);

 

(v)                                 by way of payment to any person or for any purpose to
the extent that any such payment would be permitted to be made to UGCE Inc. or
the relevant Subordinated Creditor pursuant to sub-paragraph (iii) above and
provided that any such payment shall automatically reduce the liability to UGCE
Inc. or the relevant Subordinated Creditor under the relevant obligation
referred to in sub-paragraph (iii) above to the extent of the amount paid;

 

(vi)                              by way of the repayment of any Subordinated
Shareholder Loan made, or the redemption of equity share capital in a member of
the Borrower Group subscribed for, to finance a Permitted Acquisition or a
Permitted Joint Venture, provided that (A) the repayment of such Subordinated
Shareholder Loan or the redemption of such equity share capital would not cause
the limits referred to in the definition of “Permitted Acquisition” or
“Permitted Joint Venture” to be exceeded and (B) no Default has occurred and is
continuing or would occur as a result of such payment;

 

91

 

(vii)                           by way of payment to any Restricted Person of
consideration for an acquisition, merger or consolidation permitted by Clause
16.11 (Acquisitions and mergers); and

 

(viii)                        by way of transfer to any Restricted Person of any
non-Distribution Business Assets (as defined in Clause 16.10(b)(x) (Disposals))
permitted in accordance with Clause 16.10(b)(x) (Disposals),

 

and provided
further that, in the case of (iii), (v) and (vi), prior to making the relevant
payment the Borrower Group is in compliance with the financial covenants set
out in Clause 17.2 (Financial ratios) and would be in compliance with such
covenants if Total Cash Interest had been increased by the amount of the
proposed Permitted Payment and all other Permitted Payments made since the date
to which the most recent financial statements delivered under Clause 16.2(a) or
(b) (Financial information) were prepared.

 

(d)                                 The restriction contained in paragraph (a) on the
payment by any member of the Borrower Group of Management Fees shall cease to
apply during such period as the applicable ratio for the purposes of Clause
17.2(a) (Financial ratios) is 3.50:1 (or less), provided that no Management
Fees may be paid by any member of the Borrower Group at any time after a
Relevant Event has occurred or if a Relevant Event would result from such
payment.

 

16.14                 Loans and guarantees

 

Each Obligor
(other than UPC Distribution Holdco) will not, and will procure that no member
of the Borrower Group will make any loans, grant any credit or give any
guarantee, to or for the benefit of, or enter into any transaction having the
effect of lending money to, any person,

 

other than:

 

(a)                                  loans from a member of the Borrower Group to another
member of the Borrower Group, provided that no Obligor shall make a loan to any
other member of the Borrower Group unless:

 

(i)                                     such Obligor has first entered into an Obligor Pledge
of Shareholder Loans which creates an effective pledge in favour of the
Security Agent in relation to such loan and provided the Security Agent with
such evidence as it may reasonably request as the power and authority of such
Obligor to enter into such Obligor Pledge of Shareholder Loans and that such
Obligor Pledge of Shareholder Loans constitutes valid and legally binding
obligations of such Obligor enforceable in accordance with its terms subject
(to the extent possible) to substantially similar qualifications to those made
in the legal opinions referred to in 0 (Conditions Precedent Documents); and

 

(ii)                                  the relevant member of the Borrower Group to whom the
shareholder loan is to be made has given a notification of pledge to the
Security Agent in respect of such shareholder loans;

 

(b)                                 as permitted by Clause 16.12 (Restrictions on
Financial Indebtedness);

 

(c)                                  normal trade credit in the ordinary course of
business;

 

(d)                                 guarantees given:

 

(i)                                     by any Obligor in respect of the liabilities of
another Obligor;

 

92

 

(ii)                                  by a member of the Borrower Group in respect of the
liabilities of an Obligor; or

 

(iii)                               by a member of the Borrower Group (which is not an
Obligor) in respect of the liabilities of another member of the Borrower Group
(which is not an Obligor); or

 

(iv)                              by an Obligor in respect of the liabilities of any
other member of the Borrower Group to the extent that such liabilities could
have been incurred by such Obligor directly without breaching this Agreement;
or

 

(e)                                  to the extent that the same constitute Permitted
Payments or a Permitted Disposal (not being a Permitted Disposal of cash or
cash equivalents);

 

(f)                                    loans, the granting of credit, guarantees and other
transactions having the effect of lending money (each a Lending Transaction) from a member of the
Borrower Group, in connection with an acquisition by that member which is
permitted by Clause 16.11 (Acquisitions and mergers), to the relevant person
being acquired or one or more of its Subsidiaries, provided that:

 

(i)                                     no Lending Transaction may have a term longer than 12
months (including any extensions or refinancings of the original Lending
Transaction); and

 

(ii)                                  the aggregate outstanding principal amount of all
Lending Transactions (which principal amount shall be deemed to be no longer
outstanding for this purpose at the time the beneficiary of the relevant
Lending Transaction becomes a member of the Borrower Group upon completion of
the relevant acquisition, provided such Lending Transaction was made to or in
favour of the person acquired or its Subsidiaries) shall not exceed
€100,000,000 at any time; and

 

(g)                                 Lending Transactions from a member of the Borrower
Group to any person of the proceeds of equity subscribed by any Restricted
Person in, or Subordinated Shareholder Loans provided to, such member (other
than any such proceeds which:

 

(i)                                     are taken into account in any calculation of
Acquisition Cost pursuant to sub-paragraph (c)(i)(A), (c)(i)(B) or (d)(i) of
the definition of “Permitted Acquisition” or in the calculation of the
Acquisition basket in accordance with sub-paragraph (c)(i)(1) of the definition
of “Permitted Acquisition” or in the calculation of Acquisition Cost pursuant
to sub-paragraph (b)(i)(A) or (b)(i)(B) of the definition of “Permitted Joint
Venture” or in the calculation of the Acquisition basket in accordance with the
final paragraph of sub-paragraph (b)(i) of the definition of “Permitted Joint
Venture”; or

 

(ii)                                  are subscribed or provided pursuant to Clause 17.4
(Cure provisions)).

 

16.15                 Environmental matters

 

Each Obligor
(other than UPC Distribution Holdco) will and will procure that each of its
Subsidiaries which is a member of the Borrower Group will:

 

(a)                                  (i) obtain all requisite Environmental Licences, (ii)
comply with the terms and conditions of all Environmental Licences applicable
to it and (iii) comply with all

 

93

 

other applicable Environmental Law, in each case where failure to do so
would or is reasonably likely to have a Material Adverse Effect;

 

(b)                                 promptly upon receipt of the same, notify the Facility
Agent and the Security Agent of any claim, notice or other communication served
on it in respect of any alleged breach of, or corrective or remedial obligation
or liability under, any Environmental Law which, if substantiated, would or is
reasonably likely to have a Material Adverse Effect.

 

16.16                 Insurance

 

Each Obligor
(other than UPC Distribution Holdco) will, and will procure that each of its
Material Subsidiaries which is a member of the Borrower Group will maintain
insurance cover of a type and level which a prudent company in the same
business would effect.

 

16.17                 Hedging

 

(a)                                  Each Obligor (other than UPC Distribution Holdco) will
not, and will procure that no member of the Borrower Group will, enter into any
interest rate or currency swaps, other interest rate or currency derivative
transactions or other hedging arrangements other than:

 

(i)                                     transactions and arrangements entered into with a High
Yield Hedging Bank or a Senior Hedging Bank directly relating to the management
of interest rate and/or currency exchange rate risk arising out of any
Financial Indebtedness of any member of the Borrower Group permitted to subsist
by the terms of this Agreement (or transactions and arrangements relating to
interest rate or currency swaps, other interest rate or currency derivative
transitions or other hedging arrangements that themselves relate to the
management of interest rate and/or currency exchange rate risk arising out of
any Financial Indebtedness of any member of the Borrower Group permitted to
subsist by the terms of this Agreement), in each case excluding any such
transactions or arrangements that directly or indirectly relate to Subordinated
Shareholder Loans; and

 

(ii)                                  to the extent they constitute interest rate or
currency swaps or other hedging arrangements, the guarantees granted by each of
the Guarantors pursuant to Clause 14 (Guarantee) or clause 14 (Guarantee) of
the Existing Facility Agreement (as applicable) in respect of any High Yield
Hedging Agreements.

 

(b)                                 UPC Distribution will procure that any member of the
Borrower Group that enters into a Senior Hedging Agreement (as defined in the
Existing Facility Agreement) and any member of the UGCE Borrower Group that
enters into a High Yield Hedging Agreement accedes to the Security Deed and the
Intercreditor Agreement as a Charging Entity by delivering to the Security
Agent a Security Provider’s Deed of Accession duly executed by that company.

 

16.18                 Intellectual Property Rights

 

Except as
otherwise permitted by this Agreement, each Obligor (other than UPC
Distribution Holdco) will, and will procure that each of its Subsidiaries which
is a member of the Borrower Group will:

 

(a)                                  make such registrations and pay such fees and similar
amounts as are necessary to keep those registered Intellectual Property Rights
owned by any member of the Borrower Group and which are material to the conduct
of the business of the Borrower Group as a whole from time to time;

 

94

 

(b)                                 take such steps as are necessary and commercially
reasonable (including, without limitation, the institution of legal
proceedings) to prevent third parties infringing those Intellectual Property
Rights referred to in paragraph (a) above and (without prejudice to paragraph
(a) above) take such other steps as are reasonably practicable to maintain and
preserve its interests in those rights, except where failure to do so will not
have or be reasonably likely to have a Material Adverse Effect;

 

(c)                                  ensure that any licence arrangements in respect of the
Intellectual Property Rights referred to in paragraph (a) above entered into
with any third party are entered into on arm’s length terms and in the ordinary
course of business (which shall include, for the avoidance of doubt, any such
licensing arrangements entered into in connection with outsourcing on normal
commercial terms) and will not have or be reasonably likely to have a Material
Adverse Effect;

 

(d)                                 not permit any registration of any of the Intellectual
Property Rights referred to in paragraph (a) above to be abandoned, cancelled
or lapsed or to be liable to any claim of abandonment for non-use or otherwise
to the extent the same would or is reasonably likely to have a Material Adverse
Effect; and

 

(e)                                  pay all fees, and comply with each of its material
obligations under, any licence of Intellectual Property Rights which are
material to the conduct of the business of the Borrower Group as a whole from
time to time.

 

16.19                 Share capital

 

Each Obligor (other
than UPC Distribution Holdco) will not, and will procure that no member of the
Borrower Group (other than in respect of such other members of the Borrower
Group in order to permit a solvent reorganisation permitted under Clause
16.11(d)(iii) (Acquisitions and mergers)) will, reduce its capital or purchase
or redeem any class of its shares or any other ownership interest in it, except
to the extent the same constitutes a Permitted Payment or in the case of
members of the Borrower Group other than the Obligors, is otherwise permitted
by Clause 16.13 (Restricted Payments) or is in connection with the Romania
Restructuring.

 

16.20                 Inter-connection and chello

 

Each Obligor
(other than UPC Distribution Holdco) will ensure that each member of the
Borrower Group which is not a Relevant Eastern European Subsidiary:

 

(a)                                  which offers residential telephony services in any
country, maintains inter-connection arrangements with one or more major fixed
line telephony operators in that country; and

 

(b)                                 which offers internet and/or data services is provided
with such services by chello broadband N.V. or by another provider on arm’s
length commercial terms.

 

16.21                 chello and Priority

 

For as long as
chello broadband N.V. or, as the case may be, Priority Telecom N.V. is a
Restricted Person, each Obligor (other than UPC Distribution Holdco) will not
and will not permit any contractual arrangements between chello broadband N.V.
and Priority Telecom N.V. respectively and the Borrower Group to be entered
into other than on bona fide arm’s length commercial terms or on terms that are
fair and reasonable and in the best interests of the Borrower Group.

 

95

 

16.22                 [Intentionally left blank]

 

16.23                 UPC Distribution Pledged Account

 

(a)                                  Subject to receipt of all necessary legal, regulatory,
shareholder and partner approvals (all of which each Obligor will, and will
ensure that each of its Subsidiaries will, use all reasonable efforts to obtain
as soon as practicable), each Obligor (other than UPC Distribution Holdco)
shall ensure that it and each of its Subsidiaries which is a member of the
Borrower Group, promptly following the last day of each calendar month
transfers an amount equal to its Excess Cash on that date to the UPC Distribution
Pledged Account.

 

(b)                                 For the purposes of this Clause 16.23:

 

(i)                                     Excess Cash means, in relation to any member of the Borrower
Group at any time, the aggregate cash in hand and at bank (less withdrawals and
other transfers of cash that have not cleared at bank) of that member at that
time in excess of €5,000,000 (or its equivalent in other currencies); and

 

(ii)                                  the UPC Distribution
Pledged Account means one or more accounts in the name of UPC
Distribution or any other member of the Borrower Group, held with a branch of a
bank or financial institution, which has been pledged to the Beneficiaries
pursuant to a Security Document in the agreed form and in respect of which
account(s) all notices required by that Security Document have been served upon
the relevant bank or financial institution in the manner required by that
Security Document and the relevant account bank(s) have waived any lien, right
of set-off or other Security Interest, other than in respect of routine account
keeping charges and set offs between UPC Distribution Pledged Accounts.

 

(c)                                  UPC Distribution may withdraw amounts standing to the
credit of the UPC Distribution Pledged Account at any time provided that:

 

(i)                                     any such withdrawn amount is to be applied to meet
expenditure arising in the course of the Business of the Borrower Group as
carried on in accordance with this Agreement or for any other purpose permitted
under this Agreement; and

 

(ii)                                  no Event of Default has occurred which is continuing.

 

16.24                 Share security

 

Each Obligor
(other than UPC Distribution Holdco) will not, and will procure that no member
of the Borrower Group will, issue any shares of any class provided that:

 

(a)                                  notwithstanding paragraph (b), an Obligor (other than
UPC Distribution, UPC Holding II or UPC Distribution Holdco) may issue shares
to any person other than a member of the Borrower Group and shall not be
required to procure that such shares are charged or pledged in favour of the
Beneficiaries, provided that such share issue does not result in a Change of
Control;

 

(b)                                 any member of the Borrower Group may issue shares to
or otherwise acquire additional rights from any other member of the Borrower
Group so long as (if any of the existing shares in the relevant member of the
Borrower Group are charged or pledged in favour of any Beneficiary) such shares
are charged or pledged in favour of the Beneficiaries pursuant to the terms of
a Security Document and there are delivered at the same time to the Security
Agent the relevant share certificates and

 

96

 

blank stock transfer forms (or equivalent documents) in respect thereof
together with such other documents and evidence and legal opinions as the
Security Agent may reasonably require;

 

(c)                                  UPC Distribution and UPC Holding II may issue shares
to UPC Distribution Holdco provided that such shares are charged or pledged in
favour of the Beneficiaries pursuant to the terms of a Security Document and
there are delivered at the same time to the Security Agent the relevant share certificates
and blank stock transfer forms (or equivalent documents) in respect thereof
together with such other documents and evidence and legal opinions as the
Security Agent may reasonably require;

 

(d)                                 any member of the Borrower Group may issue shares
pursuant to the exercise of Approved Stock Options;

 

(e)                                  a member of the Borrower Group may issue shares as
part of an Acquisition or merger or consolidation permitted by Clause 16.11
(Acquisitions and mergers), provided that the issue of such shares does not
cause a Change of Control;

 

(f)                                    a member of the Borrower Group (other than an Obligor)
may issue shares to all the holders of the share capital of such member pro
rata to their interests in such share capital provided that, if any existing
shares in that member of the Borrower Group are charged or pledged in favour of
any Beneficiary under any Security Document, upon issue the shares that are
issued to any other member of the Borrower Group or any Shareholder are charged
or pledged in favour of the Beneficiaries as provided in paragraph (b) above;
and

 

(g)                                 any member of the Borrower Group (other than UPC
Distribution or UPC Holding II) may issue shares to any person pursuant to any
agreement or other legally binding arrangement existing, and disclosed to the
Facility Agent in writing, on or before the Signing Date, provided that such
share issue does not result in a Change of Control.

 

16.25                 Shareholder Loans

 

(a)                                  Each Obligor will procure that prior to any Restricted
Person making any Financial Indebtedness (other than Permitted Payments)
available to any member of the Borrower Group, such Restricted Person shall
enter into a Pledge of Subordinated Shareholder Loans on terms and conditions
satisfactory to the Facility Agent and a Security Provider’s Deed of Accession
and provides (i) the Facility Agent with such documents and evidence as it may
reasonably require as to the power and authority of the Restricted Person to
enter into such Pledge of Subordinated Shareholder Loans and Security
Provider’s Deed of Accession and that the same constitute valid and legally
binding obligations of such Restricted Person enforceable in accordance with
their terms subject (to the extent applicable) to substantially similar
qualifications to those made in the legal opinions referred to in 0 (Conditions
Precedent Documents); and (ii) notification of such pledge to the relevant
member of the Borrower Group.

 

(b)                                 Each Obligor shall ensure that each Subordinated
Shareholder Loan and each shareholder loan entered into between an Obligor
which is a party to an Obligor Pledge of Shareholder Loans as a creditor and a
member of the Borrower Group is governed by the law of The Netherlands.

 

97

 

16.26                 Further security over receivables

 

UPC Distribution
shall:

 

(a)                                  on each date on which it is required to deliver the
financial statements referred to in Clause 16.2(b) (Financial information) in
respect of its second and fourth financial quarters in each financial year,
notify the Facility Agent of the details of any contracts, agreements or other
arrangements entered into by any member of the Borrower Group with chello
broadband N.V. or Priority Telecom N.V. at any time under which receivables
owing to such member of the Borrower Group aggregating €10,000,000 (or its
equivalent in other currencies) or more are outstanding on such date, together
with details of such receivables; and

 

(b)                                 if the Facility Agent (acting on the instructions of
the Majority Lenders) requires, promptly grant, or procure the grant by the
relevant member of the Borrower Group of (in each case subject to receipt of
all necessary legal, regulatory, shareholder and partner approvals, other than
approvals from chello broadband N.V. or Priority Telecom N.V, all of which UPC
Distribution will and will ensure that each member of the Borrower Group will
use all reasonable efforts to obtain as soon as possible) (i) a pledge in
favour of the Beneficiaries over the receivables referred to in (a) above in
substantially the same form as a receivables pledge already granted to the
Security Agent by a member of the Borrower Group in respect of receivables
located in, or governed by the laws of, or (as the case may be) owed by or to a
person incorporated in, the same jurisdiction as the relevant receivables or
(as the case may be) relevant person by or to whom such receivables are owed or
in such other form as the Security Agent may reasonably request and (ii) a
Security Provider’s Deed of Accession and shall provide the Security Agent with
such evidence as it may reasonably request as to the power and authority of
such member of the Borrower Group to enter into such pledge of receivables and
Security Provider’s Deed of Accession and that the same constitute valid and
legally binding obligations of such member enforceable in accordance with their
terms subject (to the extent possible) to substantially similar qualifications
to those made in the legal opinions referred to in 0 (Conditions Precedent
Documents), together with all such notices and other documents as the Security
Agent may reasonably require to perfect the receivables pledge.

 

16.27                 Financial year end

 

Each Obligor
(other than UPC Distribution Holdco) will, and will procure that its
Subsidiaries which are members of the Borrower Group will, maintain a financial
year end of 31st December, save with the prior written consent of the Facility
Agent (acting on the instructions of the Majority Lenders in each case not to
be unreasonably withheld).

 

16.28                 Capital expenditure

 

Each Obligor
(other than UPC Distribution Holdco) will not, and will procure that no member
of the Borrower Group will, incur any material Capital Expenditure other than
in relation to the Permitted Business.

 

16.29                 Constitutive documents

 

Each Obligor
will not, and will procure that no member of the Borrower Group will, amend its
constitutive documents in any way which would or is reasonably likely to
materially adversely affect (in terms of value, enforceability or otherwise)
any charge or pledge over the

 

98

 

shares or
partnership interest of any member of the Borrower Group granted to the
Beneficiaries pursuant to the Security Documents.

 

16.30                 ERISA

 

Each Obligor
(other than UPC Distribution Holdco) will, and will procure that its
Subsidiaries which are members of the Borrower Group will, give the Facility
Agent prompt notice of the adoption of, participation in or contribution to any
Plan by it or any ERISA Affiliate, or any action by any of these to adopt, participate
in or contribute to any Plan, or the incurrence by any of them of any liability
or obligation to any Plan.

 

16.31                 UPC Financing

 

(a)                                  Each Borrower will ensure that the proceeds of any
loan made to the UPC Financing by UPC Distribution or UPC Holding II and the
proceeds of any drawing made by UPC Financing under Facility C shall be
invested by way of intercompany loan or equity subscription in one or more
other members of the Borrower Group within five Business Days of receipt of
such proceeds or, as the case may be, the relevant Utilisation Date.

 

(b)                                 Each Obligor (other than UPC Distribution Holdco) will
ensure that, in accordance with the terms of any pledge of intercompany loans
made by UPC Financing, any intercompany loan made by UPC Financing to any
Obligor or any Subsidiary of an Obligor which is a member of the Borrower Group
is made on bona fide arm’s length commercial terms or on terms which are fair
and reasonable and in the best interests of UPC Financing and entered into in
good faith.

 

16.32                 UPC Poland Share Security

 

(a)                                  In the event that a member of the Borrower Group
acquires all or any part of the share capital of an entity which is
incorporated or carrying on business in Poland the Facility Agent (acting on
the instructions of the Majority Lenders) may notify UPC Distribution in
writing that it requires a pledge over the share capital of the entity so
acquired (the Polish Holdco); and

 

(b)                                 UPC Distribution shall, within 30 Business Days of
receipt of such written notice procure the grant by the relevant member of the
Borrower Group of:

 

(i)                                     a pledge in favour of the Security Agent over the
share capital of the Polish Holdco in substantially the same form as the share
pledges already granted to the Security Agent by a member of the Borrower Group
and listed in Schedule 7 (Security Documents) (save for any changes
required under Polish law); and

 

(ii)                                  a Security Provider’s Deed of Accession,

 

and shall
provide the Security Agent with such evidence as it may reasonably request as
to the power and authority of such member of the Borrower Group to enter into
the share pledge and Security Provider’s Deed of Accession and that the same
constitute valid and legally binding obligations of such member enforceable in
accordance with their terms subject (to the extent possible) to substantially
similar qualifications to those usually made in Polish law legal opinions,
together with all such notices and other documents as the Security Agent may
reasonably require to perfect the share pledge.

 

99

 

17.                               FINANCIAL
COVENANTS

 

17.1                        Financial definitions

 

In this Clause
17:

 

Annualised
EBITDA means, in respect of
any Ratio Period, two times EBITDA of the Borrower Group for that Ratio Period.

 

EBITDA
means, in respect of any period or person, the
Net Income of that person (plus, in the case of the Borrower Group, any amount
attributable to  non-cash compensation
payable to employees or directors of members of the Borrower Group deducted in
calculating Net Income, any depreciation, amortisation, other non-cash charges
(such as deferred Taxes), accrued Management Fees (whether or not paid), fees
accrued (whether or not paid) in respect of Financial Indebtedness and interest
expense and other charges in respect of Financial Indebtedness) for such period
adjusted as follows:

 

(a)                                  minus extraordinary income of the relevant person for
such period;

 

(b)                                 plus any extraordinary expenses (including one off
restructuring costs) of the relevant person for such period;

 

(c)                                  minus any interest income of the relevant person for
such period; and

 

(d)                                 in the case of the Borrower Group, minus any
Management Fees paid during such period,

 

to the extent
attributed to the Distribution Business of the Borrower Group and all as
determined in accordance with GAAP and (in the case of the Borrower Group) as
shown in the relevant financial statements prepared and delivered to the
Facility Agent pursuant to Clause 16.2(a) or (b) (Financial information) (as
the case may be).

 

Interest
means:

 

(a)                                  interest and amounts in the nature of interest
(including, without limitation, the interest element of finance leases)
accrued;

 

(b)                                 discount fees and acceptance fees payable or deducted
in respect of any Financial Indebtedness (including all commissions payable in
connection with any letter of credit); and

 

(c)                                  any net payment (or, if appropriate in the context,
receipt) under any interest rate hedging agreement or instrument (including
without limitation under the Senior Hedging Agreements and (as applicable) High
Yield Hedging Agreements), taking into account any premiums payable.

 

Net
Income means, in respect of
any period and for any period, the net profit after Taxes and (in the case of
the Borrower Group only) Management Fees, in the case of the Borrower Group to
the extent attributed to the Distribution Business of the Borrower Group for
such period as determined in accordance with GAAP and (in the case of the
Borrower Group) as shown in the financial statements in respect of such period
prepared and delivered to the Facility Agent pursuant to Clause 16.2(a) or (b)
(Financial information).

 

100

Ratio
Period means each period of
approximately 6 months covering two quarterly Accounting Periods of the Borrower
Group ending on each date to which each set of financial statements required to
be delivered under Clause 16.2(a) or (b) (Financial information) are prepared.

 

Senior
Debt means at any time, the
consolidated Financial Indebtedness of the Borrower Group, excluding:

 

(a)                                  any Financial Indebtedness which is a contingent
obligation of a member of the Borrower Group; and

 

(b)                                 any Subordinated Shareholder Loans and any Financial
Indebtedness referred to in Clause 16.12(b)(viii), (xi), (xii) and (xiii)
(Restrictions on Financial Indebtedness).

 

Senior
Debt Service means, for any Ratio
Period, the sum of:

 

(a)                                  all scheduled repayments (including scheduled
reductions of revolving credits to the extent they are drawn) of Senior Debt
which fell due during such Ratio Period; and

 

(b)                                 Total Cash Interest for that Ratio Period.

 

Senior
Interest means, in respect of
any period, the amount of Total Cash Interest paid in respect of Senior Debt
during that period.

 

Total
Cash Interest means, in
respect of any period, the total amount of all Interest paid in cash in respect
of Senior Debt and Subordinated Shareholder Loans during such period (having
taken into account the effect of any Senior Hedging Agreements), except in each
case, to the extent that such payments (other than payments in respect of
Senior Debt) are funded by distributions made by Unrestricted Subsidiaries to
UPC Distribution or any other member of the Borrower Group and excluding, for
the avoidance of doubt, capitalisation of Interest accrued in respect of Subordinated
Shareholder Loans.

 

Total
Debt means, at any time, the
aggregate amount of:

 

(a)                                  Senior Debt; and

 

(b)                                 Financial Indebtedness of each other member of the
UGCE Borrower Group, but excluding any Financial Indebtedness owing between
members of the UGCE Borrower Group.

 

17.2                        Financial ratios

 

UPC Distribution
will procure that:

 

(a)                                  the ratio of Senior Debt to Annualised EBITDA for each
Ratio Period which ends on a date or in a period specified in column 1 below
shall not exceed the ratio specified in column 2 below opposite such date or
period:

 

 

	
  Test Dates

  	
   

  	
  Ratio

  
	
  30th September, 2003

  	
   

  	
  7.75:1

  
	
  31st December, 2003

  	
   

  	
  6.75:1

  

 

101

 

	
  Test Dates

  	
   

  	
  Ratio

  
	
  31st March, 2004

  	
   

  	
  6.75:1

  
	
  30th June, 2004

  	
   

  	
  6.25:1

  
	
  30th September, 2004

  	
   

  	
  6.10:1

  
	
  31st December, 2004

  	
   

  	
  5.85:1

  
	
  31st March, 2005

  	
   

  	
  5.70:1

  
	
  30th June, 2005

  	
   

  	
  5.40:1

  
	
  30th September, 2005

  	
   

  	
  5.20:1

  
	
  31st December, 2005

  	
   

  	
  4.85:1

  
	
  31st March, 2006

  	
   

  	
  4.70:1

  
	
  30th June, 2006

  	
   

  	
  4.50:1

  
	
  30th September, 2006

  	
   

  	
  4.35:1

  
	
  31st December, 2006

  	
   

  	
  4.15:1

  
	
  31st March, 2007

  	
   

  	
  4.00:1

  
	
  30th June, 2007

  	
   

  	
  3.75:1

  
	
  30th September, 2007

  	
   

  	
  3.50:1

  
	
  31st December, 2007

  	
   

  	
  3.25:1

  
	
  Thereafter

  	
   

  	
  3.00:1

  

 

(b)                                 the ratio of EBITDA to Total Cash Interest for each
Ratio Period which ends on a date or in a period specified in column 1 below
shall not be less than the ratio specified in column 2 below opposite such date
and period:

 

	
  Test Dates

  	
   

  	
  Ratio

  
	
  30th September, 2003

  	
   

  	
  2.25:1

  
	
  31st December, 2003

  	
   

  	
  2.25:1

  
	
  31st March, 2004

  	
   

  	
  1.90:1

  
	
  30th June, 2004

  	
   

  	
  1.45:1

  
	
  30th September, 2004

  	
   

  	
  1.45:1

  

 

102

 

	
  Test Dates

  	
   

  	
  Ratio

  
	
  31st December, 2004

  	
   

  	
  1.50:1

  
	
  31st March, 2005

  	
   

  	
  1.75:1

  
	
  30th June, 2005

  	
   

  	
  1.80:1

  
	
  30th September, 2005

  	
   

  	
  1.80:1

  
	
  31st December, 2005

  	
   

  	
  1.90:1

  
	
  31st March, 2006

  	
   

  	
  2.00:1

  
	
  Thereafter

  	
   

  	
  2.00:1

  

 

(c)                                  the ratio of EBITDA to Senior Debt Service for each
Ratio Period which ends on a date or in a period specified in column 1 below
shall not be less than the ratio specified in column 2 below opposite such date
or period:

 

 

	
  Test Dates

  	
   

  	
  Ratio

  
	
  31st December, 2003

  	
   

  	
  1.00:1

  
	
  31st March, 2004

  	
   

  	
  1.00:1

  
	
  30th June, 2004

  	
   

  	
  0.90:1

  
	
  30th September, 2004

  	
   

  	
  0.90:1

  
	
  31st December, 2004

  	
   

  	
  1.50:1

  
	
  31st March, 2005

  	
   

  	
  1.60:1

  
	
  30th June, 2005

  	
   

  	
  1.40:1

  
	
  30th September, 2005

  	
   

  	
  1.40:1

  
	
  31st December, 2005

  	
   

  	
  1.40:1

  
	
  31st March, 2006

  	
   

  	
  1.50:1

  
	
  30th June, 2006

  	
   

  	
  1.35:1

  
	
  30th September, 2006

  	
   

  	
  1.40:1

  
	
  31st December, 2006

  	
   

  	
  1.40:1

  
	
  31st March, 2007

  	
   

  	
  1.40:1

  
	
  Thereafter

  	
   

  	
  1.50:1

  

 

103

 

(d)                                 the ratio of EBITDA to Senior Interest for each Ratio
Period which ends on a date or in a period specified in column 1 below shall
not exceed the ratio specified in column 2 below opposite such date or period:

 

	
  Test Dates

  	
   

  	
  Ratio

  
	
  30th September, 2003

  	
   

  	
  2.25:1

  
	
  31st December, 2003

  	
   

  	
  2.25:1

  
	
  31st March, 2004

  	
   

  	
  2.10:1

  
	
  30th June, 2004

  	
   

  	
  2.10:1

  
	
  30th September, 2004

  	
   

  	
  2.00:1

  
	
  31st December, 2004

  	
   

  	
  2.00:1

  
	
  31st March, 2005

  	
   

  	
  2.25:1

  
	
  30th June, 2005

  	
   

  	
  2.25:1

  
	
  30th September, 2005

  	
   

  	
  2.25:1

  
	
  31st December, 2005

  	
   

  	
  2.25:1

  
	
  31st March, 2006

  	
   

  	
  2.35:1

  
	
  30th June, 2006

  	
   

  	
  2.35:1

  
	
  Thereafter

  	
   

  	
  2.40:1

  

 

; and

 

(e)                                  the ratio of Total Debt to Annualised EBITDA for each
Ratio Period which ends on a date or in a period specified in column 1 below
shall not be less than the ratio specified in column 2 below opposite such date
and period:

 

	
  Test Dates

  	
   

  	
  Ratio

  
	
  30th September, 2003

  	
   

  	
  7.50:1

  
	
  31st December, 2003

  	
   

  	
  7.25:1

  
	
  31st March, 2004

  	
   

  	
  7.00:1

  
	
  30th June, 2004

  	
   

  	
  7.00:1

  
	
  30th September, 2004

  	
   

  	
  7.00:1

  
	
  31st December, 2004

  	
   

  	
  7.00:1

  
	
  31st March, 2005

  	
   

  	
  7.00:1

  

 

104

 

	
  Test Dates

  	
   

  	
  Ratio

  
	
  30th June, 2005

  	
   

  	
  6.75:1

  
	
  30th September, 2005

  	
   

  	
  6.50:1

  
	
  31st December, 2005

  	
   

  	
  6.25:1

  
	
  31st March, 2006

  	
   

  	
  5.75:1

  
	
  Thereafter

  	
   

  	
  5.75:1

  

 

17.3                        Calculations

 

For the purposes
of Clause 17.2 (Financial ratios), Senior Debt for any Ratio Period will be
calculated on the basis of Senior Debt outstanding on the last day of that
Ratio Period.

 

17.4                        Cure provisions

 

(a)                                  UPC Distribution may cure a breach of the financial
ratios set out in Clause 17.2(a), (b), (c), (d) and (e) (Financial ratios) by
procuring that additional equity is injected into the Borrower Group by one or
more Restricted Persons and/or additional Subordinated Shareholder Loans are
provided to the Borrower Group in an aggregate amount equal to:

 

(i)                                     in the case of a breach of Clause 17.2(a) or (e)
(Financial ratios), the amount which, if it had been deducted from Senior Debt
or Total Debt (as applicable) for the Ratio Period in respect of which the
breach arose, would have avoided the breach; or

 

(ii)                                  in the case of a breach of Clause 17.2(b), (c) or (d)
(Financial ratios), the amount which, if it had been added to EBITDA for the
Ratio Period in respect of which the breach arose, would have avoided the
breach; or

 

(iii)                               in the case of a breach of more than one paragraph of
Clause 17.2 (Financial ratios), the higher of the relevant amount referred to
in (i) or (ii) above.

 

(b)                                 A cure under paragraph (a) above will not be effective
unless:

 

(i)                                     the required amount of additional equity or the
proceeds of Subordinated Shareholder Loans is received by the Borrower Group
before delivery of the financial statements delivered under Clause 16.2(a) or
(b) (Financial information) which show that Clause 17.2 (Financial ratios) has
been breached; and

 

(ii)                                  in the case of a cure of Clause  17.2(a) or (e) (Financial ratios), the
proceeds of the relevant additional equity or Subordinated Shareholder Loans
are applied in full in or towards repayment or prepayment of Facility A Advances
(as defined in the Existing Facility Agreement) in accordance with Clause 7
(Cancellation and Prepayment) and, to the extent of any surplus after such
repayment or prepayment, for the purposes of the Permitted Business.

 

(c)                                  No cure may be made under this Clause 17.4:

 

(i)                                     in respect of more than five Ratio Periods during the
life of the Facilities; or

 

105

 

(ii)                                  in respect of consecutive Ratio Periods.

 

(d)                                 Where a cure is exercised under this Clause 17.4 in
respect of a breach of Clause 17.2(b), (c) or (d) (Financial ratios) and the
next Ratio Period ends approximately three months after the Ratio Period in
respect of which the cure was made, EBITDA in respect of that next Ratio Period
will be deemed, for the purposes of Clause 17.2(b), (c) and (d) (Financial
ratios), to be increased by the amount determined under sub-paragraph (a)(ii)
above in respect of the relevant cure. 
This deemed increase will not be treated as a separate cure.

 

17.5                        Determinations

 

(a)                                  Any amount outstanding in a currency other than euros
is to be taken into account at its euro equivalent calculated at the rate used
in the latest accounts delivered to the Facility Agent.

 

(b)                                 All the terms used above are to be calculated in
accordance with the GAAP on which the preparation of the Original Borrower
Group Financial Statements was based.

 

(c)                                  If there is a dispute as to any interpretation of or
computation for Clause 17.1 (Financial definitions), the interpretation or
computation of the auditors of UPC Distribution shall prevail.

 

(d)                                 If UPC Distribution is obliged or chooses to prepare
its financial statements on a different basis from the basis used in the
preparation of the Original Borrower Group Financial Statements, such financial
statements shall be accompanied by a statement (providing reasonable detail)
from UPC Distribution either:

 

(i)                                     confirming that the change(s) would have no effect on
the operation of the ratios set out in Clause 17.2 (Financial ratios); or

 

(ii)                                  unless otherwise agreed in writing by the Facility
Agent (acting upon the instructions of the Majority Lenders), if the change(s)
would have such an effect, containing a reconciliation demonstrating the effect
of the change(s) (and, for the purpose of calculating the ratios set out in
Clause 17.2 (Financial ratios), such financial statements will be treated as
though adjusted by that reconciliation so as to exclude the effect of the
changes).

 

18.                               DEFAULT

 

18.1                        Events of Default

 

Each of the
events set out in Clauses 18.2 (Non-payment) to 18.21 (KTA Network Agreement
Enforcement) is an Event of Default (whether or not caused by any reason
whatsoever outside the control of any Obligor or any other person).

 

18.2                        Non-payment

 

An Obligor does
not pay on the due date any amount payable by it under the Finance Documents
(other than any amount payable by UPC Distribution under Clause 7.6(c)
(Prepayment from disposal proceeds) of this Agreement) at the place at, and in
the currency in, which it is expressed to be payable, unless the relevant
amount is paid in full within one Business Day (in the case of principal
amounts) or three Business Days (in the case of other amounts) of the due date.

 

106

 

18.3                        Breach of other obligations

 

(a)                                  An Obligor does not comply with any of Clauses 16.6
(Pari passu ranking), 16.7 (Negative pledge), 16.10 (Disposals), 16.11
(Acquisitions and mergers), 16.13 (Restricted Payments), 16.14 (Loans and
guarantees), 16.19 (Share capital) or 17 (Financial Covenants).

 

(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 18.2 (Non-payment) and other than non-payment by UPC Distribution of any
amount under Clause 7.6(c) (Prepayment from disposal proceeds) of this
Agreement) and such failure (if capable of remedy before the expiry of such
period) continues unremedied for a period of 28 days from the earlier of the
date on which (i) such Obligor has become aware of the failure to comply or
(ii) the Facility Agent gives notice to UPC Distribution requiring the same to
be remedied.

 

18.4                        Misrepresentation

 

A representation
or warranty made or repeated by any Obligor in or in connection with any
Finance Document or in any certificate or statement delivered by or on behalf
of any Obligor under or in connection with any Finance Document (other than the
representation in Clause 15.25 (Dutch Banking Act) or 26.2(k) (Transfers by
Lenders)) is incorrect in any material respect when made or deemed to have been
made or repeated and, in the event that any representation or warranty is
capable of remedy, the misrepresentation is not remedied within 28 days of the
earlier of the date on which (i) such Obligor has become aware of the
misrepresentation or (ii) the Facility Agent gives notice to UPC Distribution
requiring the same to be remedied.

 

18.5                        Cross default

 

(a)                                  Subject to paragraph (d) below, any Financial
Indebtedness of a member of the Borrower Group or a member of the UGCE Borrower
Group is not paid when due or within any originally applicable grace period.

 

(b)                                 Subject to paragraph (d) below, any Financial
Indebtedness of a member of the Borrower Group or a member of the UGCE Borrower
Group becomes prematurely due and payable or is placed on demand, in each case
as a result of an event of default (howsoever described) under the document
relating to that Financial Indebtedness.

 

(c)                                  Subject to paragraph (d) below, any Financial
Indebtedness of a member of the Borrower Group or a member of the UGCE Borrower
Group becomes capable of being declared prematurely due and payable or placed
on demand, in each case as a result of an event of default (howsoever
described) under the document relating to that Financial Indebtedness.

 

(d)                                 It shall not be an Event of Default under:

 

(i)                                     this Clause 18.5 where the aggregate principal amount
of all Financial Indebtedness to which any event specified in paragraphs (a),
(b) or (c) relates is less than €15,000,000 (in the case of the Borrower Group)
or €50,000,000 (in the case of any member of the UGCE Borrower Group) or, as
the case may be, the equivalent in other currencies;

 

(ii)                                  this Clause 18.5 in respect of Financial Indebtedness
owing by a member of the Borrower Group to another member of the Borrower Group
which is permitted under this Agreement; and

 

107

 

(iii)                               paragraph (c) above, in the case of the Acquisition of
an entity which results in that entity becoming a member of the Borrower Group,
for a period of 180 days following completion of that Acquisition, by reason
only of an event of default (however described) arising in relation to the
Financial Indebtedness of that acquired entity as a result only of the
Acquisition of that acquired entity, provided that such Financial Indebtedness is
not placed on demand, becomes prematurely due and payable or is otherwise
accelerated during that period).

 

(e)                                  Any Financial Indebtedness of a member of the Borrower
Group under an Existing Finance Document becomes capable of being due and
payable or placed on demand, in each case as a result of an Event of Default as
defined under the relevant Existing Finance Document.

 

18.6                        Insolvency

 

(a)                                  The Netherlands:  any Obligor,
any Material Subsidiary or member of the UGCE Borrower Group organised in The
Netherlands is declared bankrupt (in staat
van faillissement verklaard) or enters into a preliminary or
definitive moratorium (in voorlopige of
definitieve surseance van betaling gaan) pursuant to the Dutch
Bankruptcy Act (Faillissementswet);
or

 

(b)                                 General:   any of the following occurs in respect of an
Obligor, any Material Subsidiary or any member of the UGCE Borrower Group:

 

(i)                                     it is, or is deemed for the purposes of any law to be,
unable to pay its debts as they fall due or insolvent;

 

(ii)                                  it admits its inability to pay its debts as they fall
due;

 

(iii)                               it suspends making payments on any of its debts or
announces an intention to do so; or

 

(iv)                              a moratorium is declared in respect of any of its
indebtedness.

 

If a moratorium
occurs in respect of any Obligor, any Material Subsidiary or any member of the
UGCE Borrower Group, the ending of the moratorium will not remedy any Event of
Default caused by the moratorium.

 

(c)                                  United States of America:  any Obligor,
any Material Subsidiary or any member of the UGCE Borrower Group which is a
partnership, or a partner of any partnership, formed under the laws of the
states of Colorado or Delaware, United States or which is incorporated under
the laws of a State of the United States or that resides or has a domicile, a
place of business or property in the United States (each a U.S. Obligor):

 

(i)                                     admit in writing its inability to, or be generally
unable to, pay its debts as such debts become due;

 

(ii)                                  makes a general assignment for the benefit of
creditors;

 

(iii)                               shall have had appointed a receiver, a custodian,
trustee or similar official for, or a receiver, custodian, trustee or similar
official shall have taken possession of, all or substantially all of its
assets, in proceedings brought by or against such Obligor or Material
Subsidiary, and such appointment shall not have been discharged or such
possession shall not have been terminated within 60 days after the effective
date thereof or such Obligor or Material Subsidiary shall have consented to or
acquiesced in such appointment or possession;

 

108

 

(iv)                              shall have filed a petition for relief under the
insolvency, bankruptcy or similar laws of the United States of America or any
state thereof, or an involuntary petition for such relief shall have been filed
against any such Obligor or Material Subsidiary under such laws and shall not
have been dismissed or terminated within 60 days after such involuntary
petition is filed; or

 

(v)                                 shall have failed to have discharged or obtained a
stay of any proceeding to enforce, within a period of 45 days after the
commencement thereof, any attachment, sequestration or similar proceeding
asserted against all or substantially all of the assets of such Obligor or
Material Subsidiary; or

 

18.7                        Insolvency proceedings

 

(a)                                  Any formal voluntary step commencing legal proceedings
(including petition or convening a meeting) is taken by any Obligor, any
Material Subsidiary or any member of the UGCE Borrower Group with a view to a
moratorium or a composition, assignment or arrangement with any class of
creditors of any Obligor, any Material Subsidiary or any member of the UGCE
Borrower Group; or

 

(b)                                 a meeting of any Obligor, any Material Subsidiary or
any member of the UGCE Borrower Group is convened by its shareholders,
directors, managing partner (in the case of UPC Financing), secretary or other
officers for the purpose of considering any resolution for, to petition for or
to file documents with a court for its winding-up, dissolution or for its
administration, suspension of payments, composition or bankruptcy or any such
resolution is passed; or

 

(c)                                  any person presents a petition or files documents,
with the appropriate legal authorities, for the winding-up or for the
administration or for the bankruptcy of any Obligor, any Material Subsidiary or
any member of the UGCE Borrower Group and the petition is not discharged or
stayed within 45 days (or, in the case of a US Obligor, 60 days); or

 

(d)                                 an order for the winding-up or administration of any
Obligor, any Material Subsidiary or any member of the UGCE Borrower Group is
made,

 

in each case
other than in connection with a reconstruction or amalgamation on terms
approved by the Facility Agent (acting on the instructions of the Majority
Lenders).

 

18.8                        Appointment of receivers and managers

 

(a)                                  Any liquidator, trustee-in-bankruptcy, preliminary
trustee, composition trustee, judicial custodian, compulsory manager, receiver,
administrative receiver or administrator is appointed in respect of any Obligor,
any Material Subsidiary or any member of the UGCE Borrower Group or any part of
its assets which is material in the context of the Borrower Group (taken as a
whole) and, only in the case of the appointment of a judicial custodian,
compulsory manager or receiver, is not discharged within 45 days (or, in the
case of a US Obligor, 60 days); or

 

(b)                                 the directors, shareholders or other officers of any
Obligor, any Material Subsidiary or any member of the UGCE Borrower Group
request the appointment of, or give notice of their intention to appoint, a
liquidator, trustee in bankruptcy, preliminary trustee, composition trustee,
judicial custodian, compulsory manager, receiver, administrative receiver or
administrator,

 

109

 

in each case
other than in connection with a reconstruction or amalgamation on terms
approved by the Facility Agent (acting on the instructions of the Majority
Lenders).

 

18.9                        Creditors’ process

 

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, any Material
Subsidiary or any member of the UGCE Borrower Group which is material in the
context of the Borrower Group (taken as a whole), except where the same is
being contested in good faith or is removed, discharged or paid within 45 days
(or, in the case of a US Obligor, 60 days).

 

18.10                 Similar proceedings

 

Anything which
has an equivalent effect to any of the events specified in Clauses 18.6 (Insolvency)
to 18.9 (Creditors’ process) (inclusive) shall occur under the laws of any
applicable jurisdiction in relation to any Obligor, any Material Subsidiary or
any member of the UGCE Borrower Group.

 

18.11                 Unlawfulness

 

It is or becomes
unlawful for any Obligor or Subordinated Creditor to perform any of its
payments or other material obligations under the Finance Documents to which it
is a party.

 

18.12                 Repudiation

 

Any Obligor or
Subordinated Creditor repudiates, or evidences an intention to repudiate, any
Finance Document to which it is a party.

 

18.13                 Cessation of Distribution Business

 

The Borrower
Group (taken as a whole) ceases to carry on all or substantially all of its
Distribution Business.

 

18.14                 Seizure

 

All or a
material part of the undertakings, assets, rights or revenues of, or shares or
other ownership interests in, UGCE Inc., UPC Distribution Holdco or the
Borrower Group (taken as a whole but excluding any undertaking, assets, rights
or revenues which do not form part of the Distribution Business) are seized,
nationalised, expropriated or compulsorily acquired by or under the authority
of any government.

 

18.15                 Environmental Matters

 

As a result of
any Environmental Law any of the Finance Parties becomes subject to a material
obligation (actual or contingent and, in the case of any contingent obligation,
being one which, at the relevant time, would be likely to arise) directly as a
result of it entering into any of the Finance Documents which was not caused by
its negligence or wilful default.

 

18.16                 Breach of Security Deed and Intercreditor Agreement

 

(a)                                  A Subordinated Creditor fails to comply with any of
its obligations under the Security Deed or the Pledge of Subordinated
Shareholder Loans to which it is party and such failure (if capable of remedy
before the expiry of such period) continues unremedied for a period of 28 days
from the earlier of the date on which (i) UPC or UPC Distribution has become
aware of

 

110

 

the failure to
comply or (ii) the Facility Agent gives notice to the relevant Subordinated
Creditor and UPC Distribution requiring the same to be remedied.

 

(b)                                 Any representation or warranty made by a Subordinated
Creditor under the Security Deed or the Pledge of Subordinated Shareholder
Loans is incorrect in any material aspect when made or repeated and, in the
event that any representation or warranty is capable of remedy, the
misrepresentation is not remedied within 28 days of the earlier of the date on
which (i) such Obligor has become aware of the misrepresentation or (ii) the
Facility Agent gives notice to that Subordinated Creditor requiring the same to
be remedied.

 

(c)                                  Any representation or warranty made by a Finance Party
(as defined in the Existing Facility Agreement) is incorrect in any material
respect when made or repeated.

 

18.17                 Loss of Licences

 

Any Licence is
in whole or part:

 

(a)                                  terminated, suspended or revoked or does not remain in
full force and effect or otherwise expires and is not renewed prior to its
expiry (in each case, without replacement by Licence(s) having substantially
equivalent effect) in any case in a manner which would or is reasonably likely
to have a Material Adverse Effect; or

 

(b)                                 is modified or is breached in a manner which would or
is reasonably likely to have a Material Adverse Effect.

 

18.18                 Material Contracts

 

(a)                                  Except as is required by any term of this Agreement,
any Material Contract to which a member of the Borrower Group is a party is
terminated, suspended, revoked or cancelled or otherwise ceases to be in full
force and effect, unless:

 

(i)                                     in the case of an Interconnect Agreement only,
services of a similar nature to those provided pursuant to such Material
Contract are at all times provided to the Borrower Group on terms which are not
materially more onerous on the relevant member of the Borrower Group or on the
terms imposed by the mandatory requirements of any regulatory body; or

 

(ii)                                  such termination, suspension, revocation, cancellation
or cessation (in the reasonable opinion of the Facility Agent) would not or is
not reasonably likely to have a Material Adverse Effect.

 

(b)                                 Any alteration or variation is made to any term of any
Material Contract to which a member of the Borrower Group is a party which
individually or cumulatively (in the reasonable opinion of the Facility Agent)
would or is reasonably likely to have a Material Adverse Effect.

 

(c)                                  Any party breaches any term of or repudiates any of
its obligations under any Material Contract to which a member of the Borrower
Group is a party where such breach or repudiation (in the opinion of the
Facility Agent exercised reasonably) would or is reasonably likely to have a
Material Adverse Effect unless, in the case of a breach of a Material Contract
by any person other than any member of the Borrower Group, the relevant
services are at all

 

111

 

relevant times
provided to the appropriate members of the Borrower Group on the basis set out
in (a) above.

 

18.19                 Material Adverse Change

 

Any event or
series of events occurs which would or is reasonably likely to have a Material
Adverse Effect.

 

18.20                 ERISA

 

The occurrence
of:

 

(a)                                  any event or condition that presents a material risk
that any member of the Borrower Group or any ERISA Affiliate may incur a
material liability to a Plan or to the United States Internal Revenue Service
or to the United States Pension Benefit Guaranty Corporation; or

 

(b)                                 an “accumulated funding deficiency” (as that term is
defined in section 412 of the United States Internal Revenue Code of 1986,
as amended, or section 302 of ERISA), whether or not waived, by reason of
the failure of any member of the Borrower Group or any ERISA Affiliate to make
a contribution to a Plan.

 

18.21                 KTA Network Agreement Enforcement

 

Valid and
enforceable KTA Security Agreements (as defined in Clause 7.6(c) (Prepayment
from disposal proceeds)) have not been entered into and:

 

(a)                                  KTA becomes obliged to pay the penalty to the
Municipality of Amsterdam on the basis of section 19 of the network
agreement between KTA and the Municipality of Amsterdam dated 6th July, 1995
and as amended on 22nd June, 1999 (the Network
Agreement); or

 

(b)                                 the Municipality of Amsterdam, as mortgagee or
pledgee, has factually taken steps to enforce, by way of execution, its pledge
or mortgage under the Network Agreement, other than on the basis of the
situation described under (a), except where such enforcement is being contested
in good faith or is removed or discharged within 45 days.

 

18.22                 Acceleration

 

On and at any
time after the occurrence of an Event of Default while such event is continuing
the Facility Agent may, and if so directed by the Majority Lenders will, by
notice to UPC Distribution declare that an Event of Default has occurred and:

 

(a)                                  cancel the Total Commitments; and/or

 

(b)                                 declare that all the Advances be payable on demand,
whereupon they shall immediately become payable on demand by the Facility Agent
on the instructions of the Majority Lenders; and/or

 

(c)                                  demand that all the Advances be immediately due and
payable, whereupon they shall become immediately due and payable together with
all interest accrued on those Advances and all other amounts payable by the
Obligors under the Finance Documents.

 

112

 

18.23                 Automatic Acceleration

 

If an Event of
Default described in Clause 18.6(c)(ii), (iii) or (iv) (United States of
America) occurs, or upon the entry of an order for relief in a voluntary or
involuntary bankruptcy of a US Borrower, all outstanding Advances drawn by a US
Borrower under this Agreement will be immediately and automatically due and
payable and the Total Commitments (to the extent they relate to such Advances)
will, if not already cancelled under this Agreement, be immediately and
automatically cancelled.

 

19.                               FACILITY AGENT, SECURITY AGENT AND LENDERS

 

19.1                        Appointment and duties of the Agents

 

(a)                                  Each Lender irrevocably appoints each Agent to act as
its agent under and in connection with the Finance Documents.

 

(b)                                 Each Finance Party appointing each Agent irrevocably
authorises each Agent on its behalf to:

 

(i)                                     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; and

 

(ii)                                  execute each Finance Document expressed to be executed
by the Facility Agent on that Finance Party’s behalf.

 

(c)                                  Each Agent shall have only those duties which are
expressly specified in this Agreement. 
Those duties are solely of a mechanical and administrative nature.

 

19.2                        Relationship

 

The relationship
between each Agent and the other Finance Parties is that of agent and principal
only.  Nothing in this Agreement
constitutes either Agent as trustee or fiduciary for any other Party or any
other person and neither Agent need hold in trust any moneys paid to it for a
Party save as provided in the Finance Documents or be liable to account for
interest on those moneys.

 

19.3                        Majority Lenders’ directions

 

(a)                                  Each 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 each Agent may act as it considers to be in the best interests of
all the Lenders.

 

(b)                                 No 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.

 

19.4                        Delegation

 

Each Agent may
act under the Finance Documents through its personnel and agents.

 

113

 

19.5                        Responsibility for documentation

 

Neither Agent 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;

 

(b)                                 the collectability of amounts payable under any
Finance Document;

 

(c)                                  the accuracy of any statements (whether written or
oral) made in or in connection with any Finance Document by any other Party; or

 

(d)                                 the integrity or security of any Finance Document or
other document or information posted or distributed electronically on any
intranet based system (or similar) in connection with the preparation,
negotiation and execution of the Finance Documents or the administration of the
Facilities.

 

19.6                        Default

 

(a)                                  Neither Agent is obliged to monitor or enquire as to
whether or not a Default has occurred. Neither Agent will be deemed to have
knowledge of the occurrence of a Default. 
However, if an 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.

 

(b)                                 Each 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.

 

19.7                        Exoneration

 

(a)                                  Without limiting paragraph (b) below, neither Agent
will be liable for any action taken or not taken by it under or in connection
with any Finance Document, unless directly caused by its gross negligence or
wilful misconduct.

 

(b)                                 No Party may take any proceedings against any officer,
employee or agent of either Agent in respect of any claim it might have against
that 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 of either Agent may
rely on this Clause 19.7 and enforce its terms under the Contracts (Rights of
Third Parties) Act 1999.

 

19.8                        Reliance

 

Each Agent may:

 

(a)                                  rely on any notice or document 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

 

114

 

(c)                                  engage, pay for and rely on legal or other
professional advisers selected by it (including those in the Facility Agent’s
employment and those representing a Party other than the Facility Agent).

 

19.9                        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 either Agent 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.

 

19.10                 Information

 

(a)                                  Each Agent shall promptly forward to the person
concerned the original or a copy of any document which is delivered to that
Agent by a Party for that person.

 

(b)                                 Except where this Agreement specifically provides
otherwise, neither Agent is obliged to review or check the accuracy or
completeness of any document it forwards to another Party.

 

(c)                                  Except as provided above, neither Agent has a 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.

 

19.11                 Each Agent individually

 

(a)                                  If it is also a Lender, each of the Facility Agent and
the Security Agent 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
Facility Agent or Security Agent (as applicable).

 

(b)                                 Each of the Agents may:

 

(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.

 

115

 

19.12                 Indemnities

 

Each Lender
shall indemnify each Agent, within three Business Days of demand, against any
cost, loss or liability incurred by the relevant Agent (otherwise than by
reason of the relevant Agent’s gross negligence or wilful misconduct) in acting
as Agent under the Finance Documents (unless the relevant Agent has been
reimbursed by an Obligor pursuant to a Finance Document).  Such indemnification shall be pro rata to
its Commitments (and for the purposes of calculating this proportion, the
amount of the Total Additional Facility Commitments and each Lender’s
Additional Facility Commitments shall be converted to euros at the Agent’s Spot
Rate of Exchange on the date of the relevant calculation).

 

19.13                 Compliance

 

(a)                                  Each 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, neither Agent
need disclose any information relating to any Obligor or any of its related
entities if the disclosure might, in the opinion of the relevant 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.

 

19.14                 Resignation of Agents

 

(a)                                  Notwithstanding its irrevocable appointment (but
subject to paragraphs (f) and (g) below), each Agent may resign by giving
notice to the Lenders and UPC Distribution, in which case the relevant Agent
may, following consultation with and with the consent of UPC Distribution (not
to be unreasonably withheld or delayed) forthwith appoint one of its Affiliates
as successor Agent or, failing that, the Majority Lenders may with the consent
of UPC Distribution (not to be unreasonably withheld or delayed) appoint a
reputable and experienced bank as successor Agent. The resignation of the
Security Agent is subject to compliance with clause 9.1 (Retirement of Security
Agent) of the Security Deed.

 

(b)                                 If the appointment of a successor Agent is to be made
by the Majority Lenders but they have not, within 30 days after notice of
resignation, appointed a successor Agent which accepts the appointment, the
retiring Agent may, following consultation with and with the consent of UPC
Distribution (not to be unreasonably withheld or delayed), appoint a successor
Agent.

 

(c)                                  The resignation of the retiring Agent and the
appointment of any successor Agent will both become effective only upon the
successor Agent notifying all the Parties that it accepts the appointment.  On giving the notification and receiving
such approval, the successor Agent will succeed to the position of the retiring
Facility Agent and the term Facility Agent
or Security Agent (as the case may
be) will mean the successor Facility Agent or Security Agent, respectively.

 

(d)                                 The retiring Agent shall, at its own cost, make
available to the successor Agent such documents and records and provide such
assistance as the successor Agent may reasonably request for the purposes of
performing its functions as the Agent under this Agreement.

 

(e)                                  Upon its resignation becoming effective, this Clause
19 shall continue to benefit the retiring Agent in respect of any action taken
or not taken by it under or in connection with the Finance Documents while it
was the relevant Agent and, subject to paragraph (d) above, it shall have no
further obligation under any Finance Document.

 

116

 

(f)                                    The Majority Lenders may by notice to an Agent require
it to resign in accordance with paragraph (a) above.  In this event, the relevant Agent shall resign in accordance with
paragraph (a) above but it shall not be entitled to appoint one of its
Affiliates as successor Agent.

 

(g)                                 UPC Distribution may, if it is unsatisfied (acting
reasonably) with the performance by an Agent of its role as Agent, following a
period of consultation with the relevant Agent of not less than 14 days, by
notice to that Agent require it to resign in accordance with paragraph (a)
above.  Such notice must specify the
reasons for which UPC Distribution is seeking the Agent’s resignation, which
must be based on reasonable grounds.  In
this event, the relevant Agent shall resign in accordance with paragraph (a)
above but it shall not be entitled to appoint one of its Affiliates as
successor Agent.

 

19.15                 Lenders

 

(a)                                  Each 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.

 

(b)                                 Each Lender, on the date on which it becomes a party
to this Agreement, represents to the Facility Agent that:

 

(i)                                     it is either:

 

(A)                              not resident in the United Kingdom for United Kingdom
Tax purposes; or

 

(B)                                a “bank” as defined in section 840A of the Income
and Corporation Taxes Act 1988 and resident in the United Kingdom;

 

(ii)                                  it is beneficially entitled to the interest payable by
the Facility Agent to it under this Agreement; and

 

(iii)                               its Facility D1 Commitment, Facility D2 Commitment,
Facility D3 Commitment, Facility D4 Commitment, Facility D5 Commitment is equal
to the amount scheduled to be repaid to it under Facility B (either as a
Facility B Lender under the Existing Facility or as the holder of a sub-participation
interest in respect of Facility B (including without limitation under a
corresponding Relevant Facility B Sub-participation Agreement) or a combination
of the foregoing) on the relevant Utilisation Date,

 

and shall
forthwith notify the Facility Agent if any of these representations cease to be
correct.

 

(c)                                  Each Lender, on the date on which it becomes a party
to this Agreement (if it is a requirement of Dutch law that such Lender is a
Professional Market Party) represents to the Finance Parties and UPC
Distribution that it is a Professional Market Party.  Such Lender acknowledges that the Finance Parties and UPC
Distribution have relied upon such representation.

 

19.16                 Separate divisions

 

In acting as an
Agent, the agency division of each of the Agents shall be treated as a separate
entity from its other divisions and departments.  Any information acquired at any time by either Agent otherwise
than in the capacity of Agent through its agency division (whether as

 

117

 

financial
adviser to any member of the Borrower Group or otherwise) may be treated as
confidential by the relevant Agent and shall not be deemed to be information
possessed by the relevant Agent in its capacity as such.  Each Finance Party acknowledges that each
Agent 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, neither
Agent will be under any obligation to provide, or be under any liability for
failure to provide, any such information to the other Finance Parties.

 

20.                               FEES

 

20.1                        Commitment fee

 

(a)                                  Subject to paragraph (c) below UPC Distribution shall
pay to the Facility Agent for distribution to each Facility D Lender pro rata
to the proportion that the relevant Lender’s Facility D1 Commitment, Facility
D2 Commitment, Facility D3 Commitment, Facility D4 Commitment or Facility D5
Commitment bears to the Total Facility D1 Commitments, Total Facility D2
Commitments, Total Facility D3 Commitments, Total Facility D4 Commitments or
Total Facility D5 Commitments respectively from time to time a commitment fee
(subject to paragraph (c) below) computed at the rate of the difference between
(i) 5.50 per cent. per annum and (ii) the Margin payable under Facility B on
any undrawn, uncancelled amount of the Total Facility D1 Commitment, Total
Facility D2 Commitments, Total Facility D3 Commitments, Total Facility D4
Commitments and Total Facility D5 Commitments.

 

(b)                                 Subject to paragraph (c) below UPC Distribution shall
pay to the Facility Agent for distribution to each Additional Facility Lender
pro rata to the proportion that the relevant Lender’s Additional Facility
Commitment bears to the Total Additional Facility Commitments from time to time
a commitment fee (subject to paragraph (d) below) computed at the rate
specified in the Additional Facility Accession Agreement on any undrawn
uncancelled amount of Total Additional Facility Commitments such rate shall not
exceed the rate applicable to the commitment fee in relation to Facility D.

 

(c)                                  Commitment fee is calculated and accrues on a daily
basis (i) in the case of the commitment fee under paragraph (a) above only on
and from the Effective Date and is payable quarterly in arrear from the
Effective Date and on the relevant Utilisation Date and (ii) in the case of the
commitment fee in paragraph (b) above only on the date of the relevant
Additional Facility Accession Agreement and payable quarterly in arrear from
the date of the relevant Additional Facility Accession Agreement and on the
relevant Utilisation Date.  Accrued
commitment fee is also payable to the Facility Agent for the relevant Lender(s)
on the cancelled amount of its (their) Facility D1 Commitment, Facility D2
Commitment, Facility D3 Commitment, Facility D4 Commitment Facility D5
Commitment or Additional Facility Commitments, as the case may be, at the time
the cancellation takes effect (but only in respect of the period up to the date
of cancellation).

 

(d)                                 Commitment fee is payable in euros in respect of
Facility D and in euros or US Dollars, as applicable, in respect of any
Additional Facility.

 

20.2                        Agent’s fees

 

UPC Distribution
shall pay to the Facility Agent and the Security Agent for their own account an
agency fee in the amounts and on the dates agreed in the relevant Fee Letter.

 

118

 

20.3                        Lenders’ Fees

 

(a)                                  UPC Distribution shall pay to the Facility Agent for
distribution to each Lender pro rata to the proportion that the relevant
Lender’s Facility D1 Commitment, Facility D2 Commitment, Facility D3
Commitment, Facility D4 Commitment or Facility D5 Commitment bears to the Total
Facility D1 Commitments, Total Facility D2 Commitments, Total Facility D3
Commitments, Total Facility D4 Commitments or Total Facility D5 Commitments:

 

(i)                                     a fee computed at the rate of 0.75 per cent. on the
amount of the Total Facility D1 Commitments, Total Facility D2 Commitments,
Total Facility D3 Commitments, Total Facility D4 Commitments and Total Facility
D5 Commitments on the Effective Date; and

 

(ii)                                  subject to paragraph (b) below, a fee computed at the
rate of 1.75 per cent. on the amount of the Total Facility D1 Commitments,
Total Facility D2 Commitments, Total Facility D3 Commitments, Total Facility D4
Commitments and Total Facility D5 Commitments on 30th December, 2004.

 

(b)                                 The fee payable under Clause 20.3(a)(i) shall be
payable by UPC Distribution within five Business Days of the Effective
Date.  The fee payable under Clause
20.3(a)(ii) above shall be payable by UPC Distribution within five Business
Days of 31st December, 2004, provided that such fee shall not be payable if, on
or before 30th December, 2004:

 

(i)                                     UPC Distribution has permanently prepaid and cancelled
at least €750,000,000 of the Existing Facility; or

 

(ii)                                  the ratio of Senior Debt to Annualised EBITDA for the
most recent Ratio Period (as defined in Clause 17.1 (Financial definitions)) is
4:1 or less.

 

For the purposes
of this Clause:

 

Annualised
EBITDA means in respect of
any Ratio Period, two times EBITDA of the Borrower Group based for that Ratio
Period adjusted to take into account any Acquisitions or disposals made after
the relevant Ratio Period but before the delivery of the relevant compliance
certificate in respect of that Ratio Period under Clause 16.2(d) (Financial
information).

 

Senior
Debt has the meaning given
to it in Clause 17.1 (Financial definitions) and shall be calculated as at 30th
December, 2004.

 

20.4                        VAT

 

Any fee referred
to in this Clause 20 (Fees) is exclusive of any applicable value added
tax.  If any value added tax is so
chargeable and is invoiced, it shall be paid by UPC Distribution at the same
time as it pays the relevant fee.  Where
appropriate, the relevant Finance Party will supply a VAT invoice in respect of
such fees.

 

21.                               EXPENSES

 

21.1                        Transaction Expenses

 

UPC Distribution
shall within ten Business Days of demand pay TD Bank Europe Limited the amount
of all costs and expenses (including legal fees) reasonably incurred by any of
them in connection with the negotiation, preparation, printing, execution and
perfection of:

 

119

 

(a)                                  this Agreement and any other documents referred to in
this Agreement; and

 

(b)                                 any other Finance Document executed after the date of
this Agreement.

 

21.2                        Amendment Costs

 

If:

 

(a)                                  an Obligor requests an amendment, waiver or consent
under or in connection with any Finance Document;

 

(b)                                 an amendment is required under Clause 25.3 (Change of
Currency),

 

UPC Distribution
shall, within ten Business Days of demand, reimburse the Facility Agent or, as
the case may be, the Security Agent, for the amount of all costs and expenses
(including legal fees) reasonably incurred by the Facility Agent or, as the
case may be, the Security Agent in responding to, evaluating, negotiating or
complying with that request or requirement.

 

21.3                        Enforcement Costs

 

UPC Distribution
shall, within ten Business Days of demand, pay to the Facility Agent on behalf
of each Finance Party the amount of all costs and expenses (including legal
fees) incurred by that Finance Party in connection with the enforcement of, or
the preservation of any rights under, any Finance Document.

 

22.                               STAMP DUTIES

 

UPC Distribution
shall pay and, within ten Business Days of demand, indemnify each Finance Party
against any cost, loss or liability which that Finance Party incurs in relation
to all stamp duty, registration and other similar Taxes payable in respect of
any Finance Document (other than those imposed by reason of any assignment or
novation by any Finance Party).

 

23.                               INDEMNITIES

 

23.1                        Currency indemnity

 

(a)                                  If any sum due from an Obligor under the Finance
Documents (a Sum), or any order, judgment
or award given or made in relation to a Sum, has to be converted from the
currency (the First Currency) in
which that Sum is payable into another currency (the Second Currency) for the purpose of:

 

(i)                                     making or filing a claim or proof against that
Obligor;

 

(ii)                                  obtaining or enforcing an order, judgment or award in
relation to any litigation or arbitration proceedings,

 

that Obligor
shall as an independent obligation, within ten Business Days of demand,
indemnify each Finance Party to whom that Sum is due against any cost, loss or
liability arising out of or as a result of the conversion including any
discrepancy between (A) the rate of exchange used to convert that Sum from the
First Currency into the Second Currency and (B) the rate or rates of exchange
available to that person at the time of its receipt of that Sum.

 

120

 

(b)                                 Each Obligor waives any right it may have in any
jurisdiction to pay any amount under the Finance Documents in a currency or
currency unit other than that in which it is expressed to be payable.

 

23.2                        Other indemnities

 

UPC Distribution
shall (or shall procure that an Obligor will), within ten Business Days of
demand, indemnify each Lender against any cost, loss or liability incurred by
that Lender as a result of:

 

(a)                                  the occurrence of any Event of Default;

 

(b)                                 a failure by an Obligor to pay any amount due under a
Finance Document on its due date, including without limitation, any cost, loss
or liability arising as a result of Clause 29 (Pro Rata Sharing);

 

(c)                                  funding, or making arrangements to fund, its
participation in an Advance requested by a Borrower in a Request but not made
by reason of the operation of any one or more of the provisions of this
Agreement (other than by reason of default or negligence by that Lender alone);
or

 

(d)                                 an Advance (or part of an Advance) not being prepaid
in accordance with a notice of prepayment given by a Borrower;

 

(e)                                  any representation made by UPC Distribution under
Clause 15.25 (Dutch Banking Act) or Clause 26.2 (Transfers by Lenders) being
incorrect when made or deemed to be made. 
UPC Distribution shall not be liable under this paragraph (e) to any
Lender which makes a representation which is untrue in relation to its status
as a Professional Market Party or its status as part of a closed circle (besloten kring).

 

23.3                        Indemnity to the Facility Agent

 

UPC Distribution
shall, within ten Business Days of demand, indemnify the Facility Agent against
any cost, loss or liability incurred by the Facility Agent (acting reasonably)
as a result of:

 

(a)                                  investigating any event which it reasonably believes
is a Default; or

 

(b)                                 acting or relying on any notice, request or
instruction which it reasonably believes to be genuine, correct and appropriately
authorised.

 

23.4                        Break Costs

 

(a)                                  UPC Distribution shall, within ten Business Days of
demand by a Finance Party, pay to that Finance Party its Break Costs
attributable to all or any part of an Advance or Unpaid Sum being paid by that
Borrower on a day other than the last day of an Interest Period for that
Advance or Unpaid Sum.

 

(b)                                 Each Lender shall, as soon as reasonably practicable
after a demand by the Facility Agent, provide a certificate (which shall be
provided to UPC Distribution) confirming the amount of its Break Costs for any
Interest Period in which they accrue.

 

121

 

24.                               EVIDENCE
AND CALCULATIONS

 

24.1                        Accounts

 

Accounts
maintained by a Finance Party in connection with this Agreement are prima facie evidence of the matters to
which they relate.

 

24.2                        Certificates and determinations

 

Any
certification or determination by a Finance Party of a rate or amount payable
under this Agreement or otherwise expressed to be determined by a Finance Party
is, in the absence of manifest error, prima
facie evidence of the matters to which it relates.

 

24.3                        Calculations

 

The interest and
the fees payable under Clause 20.1 (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, where practice in the London inter-bank market, in the case of
non-euro amounts, or the European interbank market, in the case of euro
amounts, otherwise dictates, 365 days.

 

25.                               AMENDMENTS
AND WAIVERS

 

25.1                        Required consents

 

(a)                                  Subject to Clause 25.2 (Exceptions) any term of the
Finance Documents may be amended or waived only with the consent of the
Majority Lenders and UPC Distribution and any such amendment or waiver will be
binding on all Parties.

 

(b)                                 The Facility Agent may effect, on behalf of any
Finance Party, any amendment or waiver permitted by this Clause 25.

 

25.2                        Exceptions

 

(a)                                  An amendment or waiver that has the effect of changing
or which relates to:

 

(i)                                     the definitions of “Majority Lenders” in Clause 1.1
(Definitions);

 

(ii)                                  an extension to the date of payment of any amount of
principal, interest or commitment fees under this Agreement or the Security
Documents or the deferral of a Utilisation Date in respect of a Facility D or
the extension of an Additional Facility Availability Period;

 

(iii)                               a reduction in the Margin or the amount of any payment
of principal, interest, fees or commission payable under this Agreement or the
Security Documents;

 

(iv)                              an increase in a Lender’s Facility D1 Commitment,
Facility D2 Commitment, Facility D3 Commitment, Facility D4 Commitment,
Facility D5 Commitment or Additional Facility Commitment;

 

(v)                                 an assignment, transfer, novation or other disposal of
any of, or any interest in, an Obligor’s rights and/or obligations under this
Agreement other than in accordance with Clause 26 (Changes to the Parties);

 

(vi)                              any provision which expressly requires the consent of
all the Lenders;

 

122

 

(vii)                           Clause 2.5 (Nature of a Finance Party’s rights and
obligations), Clause 26.2 (Transfers by Lenders) or this Clause 25;

 

(viii)                        a release of the guarantee under Clause 14 (Guarantee)
other than in accordance with Clause 26 (Changes to the Parties);

 

(ix)                                the selection of an Interest Period exceeding six
months; or

 

(x)                                   the release of an asset from a Security Document
(except as otherwise expressly permitted herein or in any such Security
Document and except in furtherance of a disposal or any other transaction which
is permitted by any Finance Document),

 

shall not be
made without the prior consent of all the Lenders.

 

(b)                                 An amendment or waiver which relates to the rights or
obligations of the Facility Agent may not be effected without the consent of
the Facility Agent.

 

(c)                                  The Facility Agent may agree with UPC Distribution any
amendment to or the modification of the provisions of any of the Finance
Documents or any Schedule thereto, which is necessary to correct a
manifest error.

 

(d)                                 If authorised by the Majority Lenders, the Security
Agent may, subject to paragraph (a) above, grant any waiver or consent in
relation to, or variation of the material provisions of, any Security Document.

 

25.3                        Change of Currency

 

(a)                                  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; and

 

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

 

(b)                                 If a change in any currency of a country occurs, this
Agreement will be amended to the extent the Agent specifies to be necessary to
reflect the change in currency and to put the Banks in the same position, so
far as possible, that they would have been in if no change in currency had
occurred.

 

25.4                        Waivers and remedies cumulative

 

The rights of
each Party under the Finance Documents:

 

(a)                                  may be exercised as often as necessary, subject to the
terms of the relevant Finance Documents;

 

(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 the
exercise or non-exercise of any such right is not a waiver of that right.

 

123

 

26.                               CHANGES
TO THE PARTIES

 

26.1                        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,
except:

 

(i)                                     pursuant to a merger in accordance with Clause
16.11(d) (Acquisitions and mergers); and

 

(ii)                                  that UPC Distribution Holdco (Existing UPC Distribution Holdco) may at
any time assign, transfer, novate or dispose of all of its rights and
obligations under this Agreement and the other Finance Documents to which it is
a party to another person which is the immediate Holding Company of UPC
Distribution (New UPC Distribution Holdco)
in accordance with the terms of this Agreement and the terms of such other
Finance Document, provided that any transfer or novation of obligations by
Existing UPC Distribution Holdco will not be effective until New UPC
Distribution Holdco has become an Additional Guarantor in accordance with Clause
26.4 (Additional Obligors) and has delivered or delivers the documents
specified in Clause 26.4(a)(v) (Additional Obligors).

 

(b)                                 At the time the foregoing conditions for the transfer
or novation of Existing UPC Distribution Holdco’s obligations shall have been
satisfied (or waived, as the case may be) and such transfer or novation has
taken effect:

 

(i)                                     Existing UPC Distribution Holdco will be released from
its obligations under this Agreement and the other Finance Documents, without
prejudice to any such obligations which may have accrued and shall not have
been discharged prior to such time; and

 

(ii)                                  Existing UPC Distribution Holdco will cease to be an
Original Guarantor.

 

26.2                        Transfers by Lenders

 

(a)                                  A Lender (the Existing
Lender) may at any time after the day falling five Business Days
after the Signing Date assign, transfer or novate any of its rights and/or
obligations under this Agreement and the other Finance Documents to another
person (the New Lender), provided
that:

 

(i)                                     in the case of a partial assignment, transfer or
novation of rights and/or obligations, such assignment, transfer or novation
shall be in a minimum amount of €1,000,000;

 

(ii)                                  a Facility D Lender may only assign, transfer or
novate any of its rights and/or obligations under this Agreement in respect of
any undrawn Facility D Commitments if:

 

(A)                              the New Lender will, on completion of such assignment,
transfer or novation, be entitled to receive (either as a Facility B Lender
under the Existing Facility or the holder of a sub-participation interest in
respect of Facility B under the Existing Facility (including without limitation
pursuant to a Relevant Facility B Sub-Participation Agreement) or a combination
of the foregoing) on the date of the Facility B Repayment Instalment (as defined
in the Existing Facility Agreement) corresponding to the Utilisation Date for
that undrawn Facility D Commitment, an amount of (or equal to) the Facility B
Repayment

 

124

 

Instalment (as
defined in the Existing Facility Agreement) scheduled to be repaid on that date
which is no less than the amount of that undrawn Facility D Commitment; and

 

(B)                                the Existing Lender will, on completion of such
assignment, transfer or novation, continue to be in compliance with the
representation set out in Clause 19.15(b)(iii) (Lenders) in respect of any of
its remaining undrawn Facility D Commitments; and

 

(iii)                               if immediately prior to the time of the proposed
assignment, transfer or novation becoming effective, it is a requirement of
Dutch law, the New Lender (A) is a Professional Market Party or exempted from
the requirement to be a Professional Market Party because it forms part of a
closed circle (besloten kring)
with UPC Distribution and (B) delivers a duly completed and executed
Verification Letter to UPC Distribution and makes the representation in
paragraph (2) of the Novation Certificate (as defined below).

 

(b)                                 The prior consent of UPC Distribution is required for
any such assignment, transfer or novation (unless to an Affiliate or to a
Lender, but without prejudice to Clause 26.2(a)), provided that:

 

(i)                                     UPC Distribution’s consent must not be unreasonably
withheld or delayed;

 

(ii)                                  the consent of UPC Distribution to an assignment,
transfer or novation must not be withheld solely because the assignment,
novation or transfer may result in an increase to the Mandatory Cost;

 

(iii)                               the prior consent of UPC Distribution is not required
when (A) the assignment, novation or transfer of a Lender’s rights and/or
obligations is to an Affiliate or Related Fund of that Lender or (B) an Event
of Default is outstanding;

 

(iv)                              nothing in this Clause 26.2 restricts the ability of
any Lender to enter into any sub-participation or other arrangement with any
third party relating to the Finance Documents which does not transfer to that
third party any obligation and/or legal or equitable interest in any of the
rights arising under this Agreement.

 

(c)                                  A transfer of obligations will be effective only if
the obligations are novated in accordance with Clause 26.3 (Procedure for
novations).

 

(d)                                 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 or Related Fund of that Existing Lender), the New Lender
shall, on the date the assignment, transfer and/or novation takes effect, pay
to the Facility Agent for its own account a fee of €1,500 except in the case of
an assignment, transfer or novation where such Existing Lender also assigns,
transfers or novates its rights in respect of an amount of outstanding Facility
B Advances under the Existing Facility to the same New Lender in order to
comply with the provisions of Clause 26.2(a)(ii) above in which case no fee
will be payable under this Agreement but a fee of €1,500 will be payable under
clause 26.2(d) (Transfers by Lenders) of the Existing Facility Agreement.

 

(e)                                  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;

 

125

 

(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.

 

(f)                                    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 Facility D1 Commitment,
Facility D2 Commitment, Facility D3 Commitment, Facility D4 Commitment,
Facility D5 Commitment or Additional Facility Commitment (if any) is in force.

 

(g)                                 No Facility D Lender shall enter into any assignment,
transfer, novation, sub-participation or other arrangement which results in its
entitlement under Facility B to receive (either as a Facility B Lender under
the Existing Facility or the holder of a sub-participation interest in respect
of Facility B under the Existing Facility (including without limitation
pursuant to a Relevant Facility B Sub-Participation Agreement) or a combination
of the foregoing) on the date of any Facility B Repayment Instalment (as
defined in the Existing Facility Agreement) corresponding to the Utilisation
Date for any of its undrawn Facility D Commitment, an amount of Facility B less
than the amount of its undrawn Facility D Commitment to be drawn on that date.

 

(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
26; 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.

 

(i)                                     Any reference in this Agreement to a Lender includes a
New Lender (to the extent rights have been assigned, transferred or novated to
that New Lender and to the extent that obligations have been assumed by the New
Lender) but excludes a Lender if no amount is or may be owed to or by it under
this Agreement and its Facility D1 Commitment (if any), Facility D2 Commitment
(if any), Facility D3 Commitment (if any) Facility D4 Commitment (if any)
Facility D5 Commitment (if any) and Additional Facility Commitment (if any) has
been cancelled or reduced to nil.

 

(j)                                     If any assignment, transfer or novation results, or
will result by reason of circumstances existing at the time of the assignment,
transfer or novation, in additional amounts becoming due under Clause 10 (Tax
Gross-up and Indemnities) or amounts becoming due under Clause 12 (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.

 

(k)                                  On the date that a New Lender becomes a party to this
Agreement as a Lender, UPC Distribution represents and warrants that on that
date it has verified the status of that New Lender either as:

 

126

 

(i)                                     a Professional Market Party; or

 

(ii)                                  exempted from the requirement to be a Professional
Market Party because it forms part of a closed circle (besloten kring) with UPC Distribution,

 

by obtaining a
duly completed and signed Verification Letter.

 

26.3                        Procedure for novations

 

(a)                                  A novation is effected if:

 

(i)                                     the Existing Lender and the New Lender deliver to the
Facility Agent a duly completed certificate (a Novation Certificate), substantially in the form of Part 1 of
Schedule 5 (Novation Certificate); and

 

(ii)                                  the Facility Agent executes it (which the Facility
Agent shall promptly do).

 

(b)                                 Each Finance Party (other than the Existing Lender and
the New Lender) irrevocably authorises the Facility Agent to execute any duly
completed Novation Certificate on its behalf if that Novation Certificate
effects a novation permitted by Clause 26.2 (Transfers by Lenders).

 

(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;

 

(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; and

 

(v)                                 the New Lender shall become, by the execution by the
Facility Agent of such Novation Certificate, bound by the terms of the Security
Deed as if it were an original party thereto as a Senior Beneficiary and shall
acquire the same rights and assume the same obligations towards the other
parties to the Security Deed as would have been acquired and assumed had the
New Lender been an original party to the Security Deed as a Senior Beneficiary,

 

all on the later
of (i) five Business Days after receipt of a Verification Letter accompanied by
a Novation Certificate executed by the Existing Lender and the New Lender; (ii)
the date of execution of such Novation Certificate by the Facility Agent or;
(iii) 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 Facility 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

 

127

 

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 Utilisation Date of that
Advance.

 

26.4                        Additional Obligors

 

(a)                                  (i)                                     Subject to paragraphs (b) and (c) below, a Subsidiary
of UPC Distribution may become an Additional Guarantor and any member of the
Borrower Group may become an Additional Borrower by delivering to the Facility
Agent an Obligor Accession Agreement, duly executed by that company as an
Additional Guarantor or Additional Borrower (as applicable).

 

(ii)                                  A person which (a) becomes the immediate Holding
Company of UPC Distribution or (b) becomes a Guarantor under the Existing
Facility Agreement shall, prior to or contemporaneously with becoming such
Holding Company, become an Additional Guarantor by delivering to the Facility
Agent an Obligor Accession Agreement, duly executed by that company as an
Additional Guarantor.

 

(iii)                               A member of the Borrower Group that becomes an
Additional Borrower shall, prior to or contemporaneously with becoming an
Additional Borrower, become an Additional Guarantor by delivering to the
Facility Agent an Obligor Accession Agreement (which may be the same Obligor
Accession Agreement entered into by that Additional Borrower referred to in
sub-paragraph (i) above) duly executed by that company as an Additional
Guarantor.

 

(iv)                              Upon execution and delivery of an Obligor Accession
Agreement and delivery of the documents specified in sub-paragraph (v) below,
the relevant Subsidiary, member of the Borrower Group or person referred to in
sub-paragraph (i), (ii) or (iii) above will become an Additional Guarantor or
Additional Borrower and an Additional Guarantor (as applicable).

 

(v)                                 UPC Distribution shall procure that, at the same time
as an Obligor Accession Agreement is delivered to the Facility Agent, there is
also delivered to the Facility Agent all those documents listed in Part 2 of 0
(Conditions Precedent Documents), in each case in form and substance
satisfactory to the Facility Agent (acting reasonably).

 

(vi)                              The Obligor Accession Agreement referred to in
sub-paragraph (i) above may, in the case of an Additional Guarantor, with the
prior written approval of the Facility Agent, include a limitation of the
obligations or liabilities of the relevant Additional Guarantor under Clause 14
(Guarantee) where such limitation is required by any applicable law.

 

(b)                                 UPC Distribution shall:

 

(i)                                     procure that at all times the value of the aggregate
EBITDA, total assets and total revenues of:

 

(A)                              the Guarantors as of the Effective Date (other than
UPC Distribution, any UPC Distribution Holdco, UPC Holding and UPC Holding II)
and their respective Subsidiaries (as calculated by reference to the relevant
financial statements most recently provided under Clause 16.2(a) or (b)
(Financial information)); and

 

128

 

(B)                                any Additional Guarantors which have become Guarantors
since the Effective Date and their respective Subsidiaries (as calculated by
reference to the relevant financial statements most recently provided under
Clause 16.2(a) or (b) (Financial information) or, if no such financial
statements have been provided in respect of such Additional Guarantors, as
calculated by reference to the financial statements referred to in paragraph 11
of Part 2 of 0 (Conditions Precedent Documents) provided under Clause
26.4(a)(iii) (Additional Obligors) in respect of each Additional Guarantor),

 

is equal to or
greater than 95 per cent. of the Borrower Group’s consolidated EBITDA, total
assets and total revenues (as calculated by reference to the relevant financial
statements most recently provided under Clause 16.2(a) or (b) (Financial
information)), if necessary by procuring that additional Subsidiaries of UPC
Distribution become Additional Guarantors; and

 

(ii)                                  consult with the Facility Agent prior to any entity
becoming an Additional Guarantor in order to ensure that no material adverse
change would or be reasonably likely to occur, as a result of such entity
becoming an Additional Guarantor, in the consolidated financial position of the
Borrower Group (taken as a whole) which would or be reasonably likely to have a
Material Adverse Effect.

 

(c)                                  A member of the Borrower Group may only become an
Additional Borrower:

 

(i)                                     under an Additional Facility;

 

(ii)                                  if such member of the Borrower Group executes an
Obligor Accession Agreement prior to or contemporaneously with the execution by
the relevant Initial Additional Facility Lenders of the relevant Additional
Facility Accession Agreement and such Obligor Accession Agreement specifies the
relevant Additional Facility under which that member of the Borrower Group is
to be a Borrower; and

 

(iii)                               with the prior consent of the Majority Lenders.

 

(d)                                 UPC Distribution represents and warrants to the
Finance Parties that it is in compliance with paragraph (b) above as of the
Effective Date (all relevant calculations being made by reference to the
financial statements most recently provided under Clause 16.2(a) or (b)
(Financial information)).

 

(e)                                  After the Effective Date, UPC Distribution shall be in
compliance with its obligations under paragraph (b) above if it procures that
any of its Subsidiaries which are required to become Additional Guarantors do
so within 60 days after the delivery to the Facility Agent of any financial
statements delivered under Clause 16.2(a) or (b) (Financial information) which
demonstrate that additional Subsidiaries of UPC Distribution are required to be
become Additional Guarantors under paragraph (b).

 

(f)                                    The execution of an Obligor Accession Agreement
constitutes confirmation by the relevant Additional Guarantor or Additional
Borrower (if applicable) that the relevant representations and warranties set
out in Clause 15 (Representations and Warranties) to be made by it on the date
of the Obligor Accession Agreement are correct, as if made with reference to
the facts and circumstances then existing.

 

129

 

26.5                        Reference Banks

 

(a)                                  If a Reference Bank ceases to be a Lender, the
Facility Agent shall (after consulting with UPC Distribution) appoint another
Lender which is not a Reference Bank to replace that Reference Bank.

 

(b)                                 UPC Distribution and the Facility Agent may agree to
add one or more additional Reference Bank(s) from among the Lenders.

 

26.6                        Register

 

The Facility
Agent shall maintain at its address referred to in Clause 32.2(b) (Addresses
for notices) a copy of each Novation Certificate delivered to and accepted by
it and a register of the names and addresses all the Parties including, in the
case of Lenders, their Commitments under each Facility, the principal amount of
the Advances owing under each Facility to each Lender from time to time and the
details of their Facility Office notified to the Facility 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 entries in
such register shall be conclusive and binding for all purposes, absent manifest
error, and the Obligors, the Facility Agent and the Lenders shall treat each
person whose name is recorded in the register as a Lender hereunder for all
purposes of this Agreement.

 

27.                               DISCLOSURE
OF INFORMATION

 

(a)                                  Any Lender may disclose to any of its Affiliates and
any other person:

 

(i)                                     to (or through) whom that Lender assigns or transfers
(or may potentially assign or transfer) all or any of its rights and
obligations under this Agreement;

 

(ii)                                  with (or through) whom that Lender enters into (or may
potentially enter into) any sub-participation in relation to, or any other
transaction under which payments are to be made by reference to, this Agreement
or any Obligor; or

 

(iii)                               to whom, and to the extent that, information is
required to be disclosed by any applicable law or regulation,

 

any information
about any Obligor, the Borrower Group and the Finance Documents as that Lender
shall consider appropriate (acting reasonably) if, in relation to
sub-paragraphs (i) and (ii) above, the person to whom the information is to be
given has entered into a Confidentiality Undertaking.

 

(b)                                 Notwithstanding any other provision of this Agreement,
any Party to this Agreement (and any of its affiliates, officers, directors,
employees, representatives, professional advisers, or other agents) may (and
has since the commencement of discussions with respect to the Facility been
permitted to) disclose to any and all persons, without limitation of any kind:

 

(i)                                     the U.S. tax
treatment and U.S.  tax structure (each as defined below) of
the Facility; and

 

(ii)                                  all material of any kind (including opinions and other
tax analyses) that are provided to such party relating to such U.S. tax
treatment or U.S. tax structure,

 

except to the
extent reasonably necessary to comply with applicable federal or state
securities laws.

 

130

 

For the purposes
of this subsection, the U.S.  tax treatment of the Facility is the
purported or claimed U.S. federal, state and local income tax treatment of the
Facility, and the U.S.  tax structure of the Facility is any fact
that may be relevant to understanding the purported or claimed U.S. federal,
state and local income tax treatment of the Facility.  This authorisation is not intended to permit disclosure of any
information (other than information relating to the U.S. tax treatment or U.S.
tax structure of the Facility) including (without limitation) (i) any portion
of any materials to the extent not related to the U.S. tax treatment or U.S.
tax structure of the Facility, (ii) the identities of participants or potential
participants in the Facility (except to the extent such identities are related
to the U.S. tax treatment or the U.S. tax structure of the Facility), (iii) the
existence or status of any negotiations, (iv) any pricing or financial
information (except to the extent such pricing or financial information is
related to the U.S. tax treatment or the U.S. tax structure of the Facility),
or (v) any other term or detail not relevant to the U.S. tax treatment or the
U.S. tax structure of the Facility.

 

28.                               SET-OFF

 

28.1                        Contractual set-off

 

A Finance Party
may set off any matured obligation owed by an Obligor under the Finance
Documents (to the extent beneficially owned by that Finance Party) against any
matured obligation owed by that Finance Party to that Obligor, regardless of
the place of payment, booking branch or currency of either obligation.  If the obligations are in different currencies,
the Finance Party may convert either obligation at a market rate of exchange in
its usual course of business for the purpose of the set-off.

 

28.2                        Set-off not mandatory

 

No Finance Party
shall be obliged to exercise any right given to it by Clause 28.1 (Contractual
set-off).

 

28.3                        Notice of set-off

 

Any Finance
Party exercising its rights under Clause 28.1 (Contractual set-off) shall
notify the relevant Obligor promptly after set-off is applied.

 

29.                               PRO
RATA SHARING

 

29.1                        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 Facility Agent in
accordance with Clause 9 (Payments) (a recovery),
then:

 

(a)                                  the recovering Finance Party shall, within three
Business Days, notify details of the recovery to the Facility Agent;

 

(b)                                 the Facility 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 Facility Agent and
distributed in accordance with Clause 9 (Payments);

 

(c)                                  subject to Clause 29.3 (Exceptions), the recovering
Finance Party shall, within three Business Days of demand by the Facility
Agent, pay to the Facility Agent an amount (the redistribution) equal to the excess;

 

131

 

(d)                                 the Facility Agent shall treat the redistribution as
if it were a payment by the Obligor concerned under Clause 9 (Payments) and
shall pay the redistribution to the Finance Parties (other than the recovering
Finance Party) in accordance with Clause 9.7 (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.

 

29.2                        Reversal of redistribution

 

If under Clause
29.1 (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 Facility Agent, reimburse the recovering Finance Party all or
the appropriate portion of the redistribution paid to that Finance Party.  Thereupon the subrogation in Clause 29.1(e)
(Redistribution) will operate in reverse to the extent of the reimbursement.

 

Each Finance
Party agrees with the Facility Agent that it will comply with any notice given
to it by the Facility Agent under this Clause 29.2.

 

29.3                        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 29.1(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.

 

30.                               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.

 

31.                               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.

 

132

 

32.                               NOTICES

 

32.1                        Giving of notices

 

All notices or
other communications under or in connection with this Agreement shall be given
in writing and, unless stated, may be made by letter, telex or facsimile or (to
the extent that (i) the relevant Party has specified such an address pursuant
to Clause 32.2 (Addresses for notices) and (ii) such notice or communication is
not required to be signed by an Authorised Signatory, other officer or board of
the relevant entity and the form of such notice or communication does not
provide for signature by an Authorised Signatory, other officer or board of the
relevant entity) by e-mail.  Any such
notice will be deemed to be given as follows:

 

(a)                                  if by letter, when delivered personally or on actual
receipt; and

 

(b)                                 if by facsimile or e-mail, when received in legible
form.

 

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.

 

32.2                        Addresses for notices

 

(a)                                  The address and facsimile number and (if so specified)
e-mail address of each Party (other than the Facility Agent and the Borrowers)
for all notices under or in connection with this Agreement are:

 

(i)                                     that notified by that Party for this purpose to the
Facility Agent on or before it becomes a Party; or

 

(ii)                                  any other notified by that Party for this purpose to
the Facility Agent by not less than five Business Days’ notice.

 

(b)                                 The address, facsimile numbers and e-mail address of
the Facility Agent and the Security Agent are:

 

TD Bank Europe
Limited

Triton Court

14/18 Finsbury
Square

London EC2A 1DB

 

Contact: Rory McCarthy

 

Facsimile:                                            +44 20 7638 0006

 

E-mail:                                                             rory.mccarthy@tdsecurities.com

 

and in each case
with a copy to:

 

TD Bank Europe
Limited

Royal Trust
Tower

77 King Street
West

18th Floor

Toronto

 

133

 

Ontario, Canada

M5K 1A2

 

	
  Contact:

  	
  Marc Scaeffer/Parin Kanji

  
	
   

  	
   

  
	
  Facsimile:

  	
  +1 416 982 6630

  

 

or such other as
the Facility Agent may notify to the other Parties by not less than five
Business Days’ notice.

 

(c)                                  The address, facsimile numbers and e-mail address of
UPC Distribution is:

 

UPC Distribution
Holding B.V.

Boeing Avenue 53

1119 PE Schiphol
Rijk

Amsterdam

 

	
  Contact:

  	
  Dennis Okhuijsen

  
	
   

  	
   

  
	
  Facsimile:

  	
  + 3120 778 9453; and

  
	
   

  	
   

  
	
  E-mail:

  	
  dokhuijsen@UPCcorp.com

  

 

or such other as
the Borrower may notify to the other Parties by not less than five Business
Days’ notice.

 

(d)                                 The Facility Agent shall, promptly upon request from
any Party, give to that Party the address, facsimile number or e-mail address
(if applicable) of any other Party applicable at the time for the purposes of
this Clause 32.

 

33.                               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 and the Facility Agent so requests,
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.

 

34.                               JURISDICTION

 

34.1                        Submission

 

For the benefit
of each Finance Party, each Obligor agrees that the courts of England have
jurisdiction to settle any disputes in connection with any Finance Document
(other than any Security Document expressed to be governed by laws other than
the laws of England) and accordingly submits to the jurisdiction of the English
courts.

 

34.2                        Service of process

 

Without
prejudice to any other mode of service, each Obligor which is not incorporated
in England and Wales:

 

134

 

(a)                                  irrevocably appoints UPC Services Ltd, 4th
Floor, Michelen House, 81 Fulham Road, London, SW3 6RD as its agent for service
of process relating to any proceedings before the English courts in connection
with any Finance Document;

 

(b)                                 agrees to maintain an agent for service of process in
England until all Facility D1 Commitments, Facility D2 Commitments, Facility D3
Commitments, Facility D4 Commitments, Facility D5 Commitments and Additional
Facility Commitments have terminated and the Advances and all other amounts
payable under the Finance Documents have been finally, irrevocably and
indefeasibly repaid in full;

 

(c)                                  agrees that failure by a process agent to notify the
Obligor of the process will not invalidate the proceedings concerned;

 

(d)                                 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 32.2 (Addresses for notices); and

 

(e)                                  agrees that if the appointment of any person mentioned
in paragraph (a) 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
Facility Agent is entitled and authorised to appoint a process agent for the
Obligor by notice to the Obligor.

 

34.3                        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.

 

34.4                        Non-exclusivity

 

Nothing in this
Clause 34 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

 

(b)                                 concurrently in more than one jurisdiction.

 

35.                               WAIVER
OR IMMUNITY

 

Each Obligor
irrevocably and unconditionally:

 

(a)                                  agrees that if a Finance Party brings proceedings against
it or its assets in relation to a Finance Document, no immunity from those
proceedings (including, without limitation, suit, attachment prior to judgment,
other attachment, the obtaining of judgment, execution or other enforcement)
will be claimed by or on behalf of itself or with respect to its assets;

 

135

 

(b)                                 waives any such right of immunity which it or its
assets now has or may subsequently acquire; and

 

(c)                                  consents generally in respect of any such proceedings
to the giving of any relief or the issue of any process in connection with
those proceedings, including, without limitation, the making, enforcement or
execution against any assets whatsoever (irrespective of its use or intended
use) of any order or judgment which may be made or given in those proceedings.

 

36.                               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.

 

37.                               GOVERNING
LAW

 

This Agreement
is governed by and construed in accordance with English law.

 

This Agreement
has been entered into on the date stated at the beginning of this Agreement.

 

136

 

SCHEDULE 1

 

ORIGINAL PARTIES

 

PART 1

 

ORIGINAL GUARANTORS

 

	
  Name

  	
   

  	
  Address

  
	
   

  	
   

  	
   

  
	
  UPC Financing Partnership

  	
   

  	
  4643 South Ulster Street

  Suite 1300

  Denver, Co 80237

  United States

  
	
   

  	
   

  	
   

  
	
  UPC Distribution Holding B.V.

  	
   

  	
  Boeing Avenue 53

  1119 PE Schiphol Rijk

  Amsterdam

  The Netherlands

  
	
   

  	
   

  	
   

  
	
  UPC Holding II B.V.

  	
   

  	
  Boeing Avenue 53

  1119 PE Schiphol Rijk

  Amsterdam

  The Netherlands

  
	
   

  	
   

  	
   

  
	
  UPC Holding B.V.

  	
   

  	
  Boeing Avenue 53

  1119 PE Schiphol Rijk

  Amsterdam

  The Netherlands

  
	
   

  	
   

  	
   

  
	
  UPC France Holding B.V

  	
   

  	
  Boeing Avenue 53

  1119 PE Schiphol Rijk

  Amsterdam

  The Netherlands

  
	
   

  	
   

  	
   

  
	
  UPC Scandinavia Holding B.V.

  	
   

  	
  Boeing Avenue 53

  1119 PE Schiphol Rijk

  Amsterdam

  The Netherlands

  
	
   

  	
   

  	
   

  
	
  Cable Network Austria Holding B.V.

  	
   

  	
  Boeing Avenue 53

  1119 PE Schiphol Rijk

  Amsterdam

  The Netherlands

  
	
   

  	
   

  	
   

  
	
  Stipdon Investments B.V.

  	
   

  	
  Boeing Avenue 53

  1119 PE Schiphol Rijk

  Amsterdam

  The Netherlands

  

 

137

 

	
  Name

  	
   

  	
  Address

  
	
   

  	
   

  	
   

  
	
  UPC Nederland B.V.

  	
   

  	
  Boeing Avenue 53

  1119 PE Schiphol Rijk

  Amsterdam

  The Netherlands

  

 

138

 

PART 2

 

INITIAL
FACILITY D LENDERS AND COMMITMENTS

 

	
  Lender

  	
   

  	
  Facility D1

  Commitments

  	
   

  	
  Facility D2

  Commitments

  	
   

  	
  Facility D3

  Commitments

  	
   

  	
  Facility D4

  Commitments

  	
   

  	
  Facility D5

  Commitments

  	
   

  
	
  Ares leveraged Investment fundII LP

  	
   

  	
  €

  	
  584,161.25

  	
   

  	
  €

  	
  1,051,490.25

  	
   

  	
  €

  	
  1,051,490.25

  	
   

  	
  €

  	
  1,518,819.25

  	
   

  	
  €

  	
  1,518,819.25

  	
   

  
	
  B&W Master Tobacco retirement (GT)

  	
   

  	
  €

  	
  56,663.64

  	
   

  	
  €

  	
  101,994.55

  	
   

  	
  €

  	
  101,994.55

  	
   

  	
  €

  	
  147,325.47

  	
   

  	
  €

  	
  147,325.47

  	
   

  
	
  Bank of America N.A.

  	
   

  	
  €

  	
  7,455,291.56

  	
   

  	
  €

  	
  13,419,524.80

  	
   

  	
  €

  	
  13,419,524.80

  	
   

  	
  €

  	
  19,383,758.05

  	
   

  	
  €

  	
  19,383,758.05

  	
   

  
	
  Bank of America N.A. (Emerging
  Markets)

  	
   

  	
  €

  	
  3,362,229.51

  	
   

  	
  €

  	
  6,052,013.11

  	
   

  	
  €

  	
  6,052,013.11

  	
   

  	
  €

  	
  8,741,796.72

  	
   

  	
  €

  	
  8,741,796.72

  	
   

  
	
  Bank of America N.A. (New York)

  	
   

  	
  €

  	
  890,845.90

  	
   

  	
  €

  	
  1,603,522.63

  	
   

  	
  €

  	
  1,603,522.63

  	
   

  	
  €

  	
  2,316,199.35

  	
   

  	
  €

  	
  2,316,199.35

  	
   

  
	
  Bear, Stearns Corporate Lending Inc.

  	
   

  	
  €

  	
  4,956,342.67

  	
   

  	
  €

  	
  8,921,416.80

  	
   

  	
  €

  	
  8,921,416.80

  	
   

  	
  €

  	
  12,886,490.94

  	
   

  	
  €

  	
  12,886,490.94

  	
   

  
	
  BNP Paribas, Belgian Branch

  	
   

  	
  €

  	
  7,277,101.02

  	
   

  	
  €

  	
  13,098,781.84

  	
   

  	
  €

  	
  13,098,781.84

  	
   

  	
  €

  	
  18,920,462.66

  	
   

  	
   

  	
  18,920,462.66

  	
   

  
	
  Canadian Imperial Bank of Commerce,
  London Branch

  	
   

  	
  €

  	
  2,734,392.42

  	
   

  	
  €

  	
  4,921,906.36

  	
   

  	
  €

  	
  4,921,906.36

  	
   

  	
  €

  	
  7,109,420.30

  	
   

  	
  €

  	
  7,109,420.30

  	
   

  
	
  Citibank N.A.

  	
   

  	
  €

  	
  1,265,543.62

  	
   

  	
  €

  	
  2,277,978.52

  	
   

  	
  €

  	
  2,277,978.52

  	
   

  	
  €

  	
  3,290,413.41

  	
   

  	
  €

  	
  3,290,413.41

  	
   

  
	
  Credit Lyonnais SA

  	
   

  	
  €

  	
  6,814,971.17

  	
   

  	
  €

  	
  12,266,948.11

  	
   

  	
  €

  	
  12,266,948.11

  	
   

  	
  €

  	
  17,718,925.04

  	
   

  	
  €

  	
  17,718,925.04

  	
   

  
	
  Credit Suisse First Boston

  	
   

  	
  €

  	
  584,161.25

  	
   

  	
  €

  	
  1,051,490.25

  	
   

  	
  €

  	
  1,051,490.25

  	
   

  	
  €

  	
  1,518,819.25

  	
   

  	
  €

  	
  1,518,819.25

  	
   

  
	
  Deutsche Bank AG

  	
   

  	
  €

  	
  14,441,056.68

  	
   

  	
  €

  	
  25,993,902.03

  	
   

  	
  €

  	
  25,993,902.03

  	
   

  	
  €

  	
  37,546,747.38

  	
   

  	
  €

  	
  37,546,747.38

  	
   

  
	
  Deutsche Bank Structured Products Inc.

  	
   

  	
  €

  	
  11,683.22

  	
   

  	
  €

  	
  21,029.80

  	
   

  	
  €

  	
  21,029.80

  	
   

  	
  €

  	
  30,376.38

  	
   

  	
  €

  	
  30,376.38

  	
   

  
	
  Fortis Bank (Nederland) N.V.

  	
   

  	
  €

  	
  3,894,164.93

  	
   

  	
  €

  	
  7,009,496.87

  	
   

  	
  €

  	
  7,009,496.87

  	
   

  	
  €

  	
  10,124,828.81

  	
   

  	
  €

  	
  10,124,828.81

  	
   

  
	
  GE Capital Corporation

  	
   

  	
  €

  	
  1,197,530.56

  	
   

  	
  €

  	
  2,155,555.01

  	
   

  	
  €

  	
  2,155,555.01

  	
   

  	
  €

  	
  3,113,579.46

  	
   

  	
  €

  	
  3,113,579.46

  	
   

  
	
  Golden Tree HY Master

  	
   

  	
  €

  	
  523,857.32

  	
   

  	
  €

  	
  942,943.18

  	
   

  	
  €

  	
  942,943.18

  	
   

  	
  €

  	
  1,362,029.04

  	
   

  	
  €

  	
  1,362,029.04

  	
   

  
	
  Golden Tree HY Master Fund II

  	
   

  	
  €

  	
  175,248.37

  	
   

  	
  €

  	
  315,447.07

  	
   

  	
  €

  	
  315,447.07

  	
   

  	
  €

  	
  455,645.77

  	
   

  	
  €

  	
  455,645.77

  	
   

  
	
  Golden Tree HY OPP I

  	
   

  	
  €

  	
  693,595.36

  	
   

  	
  €

  	
  1,248,471.65

  	
   

  	
  €

  	
  1,248,471.65

  	
   

  	
  €

  	
  1,803,347.94

  	
   

  	
  €

  	
  1,803,347.94

  	
   

  
	
  Golden Tree HY OPP II

  	
   

  	
  €

  	
  714,137.13

  	
   

  	
  €

  	
  1,285,446.83

  	
   

  	
  €

  	
  1,285,446.83

  	
   

  	
  €

  	
  1,856,756.53

  	
   

  	
  €

  	
  1,856,756.53

  	
   

  
	
  GoldenTree HY Value Master Fund

  	
   

  	
  €

  	
  152,174.01

  	
   

  	
  €

  	
  273,913.21

  	
   

  	
  €

  	
  273,913.21

  	
   

  	
  €

  	
  395,652.41

  	
   

  	
  €

  	
  395,652.41

  	
   

  

 

139

 

	
  Goldman Sachs Credit Partners

  	
   

  	
  €

  	
  3,701,138.93

  	
   

  	
  €

  	
  6,662,050.07

  	
   

  	
  €

  	
  6,662,050.07

  	
   

  	
  €

  	
  9,622,961.22

  	
   

  	
  €

  	
  9,622,961.22

  	
   

  
	
  ING Bank N.V.

  	
   

  	
  €

  	
  3,894,269.24

  	
   

  	
  €

  	
  7,009,684.63

  	
   

  	
  €

  	
  7,009,684.63

  	
   

  	
  €

  	
  10,125,100.02

  	
   

  	
  €

  	
  10,125,100.02

  	
   

  
	
  JP Morgan Chase Bank

  	
   

  	
  €

  	
  9,880,775.05

  	
   

  	
  €

  	
  17,785,395.09

  	
   

  	
  €

  	
  17,785,395.09

  	
   

  	
  €

  	
  25,690,015.13

  	
   

  	
  €

  	
  25,690,015.13

  	
   

  
	
  Moore US restructuring LP

  	
   

  	
  €

  	
  134,357.09

  	
   

  	
  €

  	
  241,842.76

  	
   

  	
  €

  	
  241,842.76

  	
   

  	
  €

  	
  349,328.43

  	
   

  	
  €

  	
  349,328.43

  	
   

  
	
  Morgan Stanley Emerging Markets

  	
   

  	
  €

  	
  3,504,967.49

  	
   

  	
  €

  	
  6,308,941.49

  	
   

  	
  €

  	
  6,308,941.49

  	
   

  	
  €

  	
  9,112,915.48

  	
   

  	
  €

  	
  9,112,915.48

  	
   

  
	
  Morgan Stanley Senior Funding Inc

  	
   

  	
  €

  	
  3,047,235.43

  	
   

  	
  €

  	
  5,485,023.77

  	
   

  	
  €

  	
  5,485,023.77

  	
   

  	
  €

  	
  7,922,812.11

  	
   

  	
  €

  	
  7,922,812.11

  	
   

  
	
  Municipal Fire and Police Retirement
  (GT)

  	
   

  	
  €

  	
  29,792.22

  	
   

  	
  €

  	
  53,626.00

  	
   

  	
  €

  	
  53,626.00

  	
   

  	
  €

  	
  77,459.78

  	
   

  	
  €

  	
  77,459.78

  	
   

  
	
  ORN European Debt Fund L.P.

  	
   

  	
  €

  	
  323,938.65

  	
   

  	
  €

  	
  583,089.58

  	
   

  	
  €

  	
  583,089.58

  	
   

  	
  €

  	
  842,240.50

  	
   

  	
  €

  	
  842,240.50

  	
   

  
	
  Perry Principals LLC

  	
   

  	
  €

  	
  1,110,480.92

  	
   

  	
  €

  	
  1,998,865.65

  	
   

  	
  €

  	
  1,998,865.65

  	
   

  	
  €

  	
  2,887,250.38

  	
   

  	
  €

  	
  2,887,250.38

  	
   

  
	
  QDRF Master Limited

  	
   

  	
  €

  	
  961,157.68

  	
   

  	
  €

  	
  1,730,083.82

  	
   

  	
  €

  	
  1,730,083.82

  	
   

  	
  €

  	
  2,499,009.96

  	
   

  	
  2,499,009.96

  	
   

  
	
  Quantum Partners LDC

  	
   

  	
  €

  	
  847,307.84

  	
   

  	
  €

  	
  1,525,154.11

  	
   

  	
  €

  	
  1,525,154.11

  	
   

  	
  €

  	
  2,203,000.39

  	
   

  	
  €

  	
  2,203,000.39

  	
   

  
	
  Satellite Senior Income Fund LLC

  	
   

  	
  €

  	
  1,856,760.31

  	
   

  	
  €

  	
  3,342,168.56

  	
   

  	
  €

  	
  3,342,168.56

  	
   

  	
  €

  	
  4,827,576.80

  	
   

  	
  €

  	
  4,827,576.80

  	
   

  
	
  Scotiabank Europe plc

  	
   

  	
  €

  	
  3,124,888.39

  	
   

  	
  €

  	
  5,624,799.11

  	
   

  	
  €

  	
  5,624,799.11

  	
   

  	
  €

  	
  8,124,709.82

  	
   

  	
  €

  	
  8,124,709.82

  	
   

  
	
  Strategic Value Master Fund Ltd

  	
   

  	
  €

  	
  274,555.79

  	
   

  	
  €

  	
  494,200.42

  	
   

  	
  €

  	
  494,200.42

  	
   

  	
  €

  	
  713,845.05

  	
   

  	
  €

  	
  713,845.05

  	
   

  
	
  TD Texas (inc)

  	
   

  	
  €

  	
  2,598,305.42

  	
   

  	
  €

  	
  4,676,949.76

  	
   

  	
  €

  	
  4,676,949.76

  	
   

  	
  €

  	
  6,755,594.10

  	
   

  	
  €

  	
  6,755,594.10

  	
   

  
	
  The Royal Bank of Scotland plc

  	
   

  	
  €

  	
  6,814,971.17

  	
   

  	
  €

  	
  12,266,948.11

  	
   

  	
  €

  	
  12,266,948.11

  	
   

  	
  €

  	
  17,718,925.04

  	
   

  	
  €

  	
  17,718,925.04

  	
   

  
	
  The Toronto Dominion Bank

  	
   

  	
  €

  	
  7,558,273.69

  	
   

  	
  €

  	
  13,604,892.65

  	
   

  	
  €

  	
  13,604,892.65

  	
   

  	
  €

  	
  19,651,511.61

  	
   

  	
  €

  	
  19,651,511.61

  	
   

  
	
  TRS IO LLC

  	
   

  	
  €

  	
  1,869,316.00

  	
   

  	
  €

  	
  3,364,768.79

  	
   

  	
  €

  	
  3,364,768.79

  	
   

  	
  €

  	
  4,860,221.59

  	
   

  	
  €

  	
  4,860,221.59

  	
   

  
	
  University of Chicago (GT)

  	
   

  	
  €

  	
  53,450.75

  	
   

  	
  €

  	
  96,211.36

  	
   

  	
  €

  	
  96,211.36

  	
   

  	
  €

  	
  138,971.96

  	
   

  	
  €

  	
  138,971.96

  	
   

  
	
  Total

  	
   

  	
  €

  	
  109,371,093.66

  	
   

  	
  €

  	
  196,867,968.60

  	
   

  	
  €

  	
  196,867,968.60

  	
   

  	
  €

  	
  284,364,843.53

  	
   

  	
  €

  	
  284,364,843.53

  	
   

  

 

140

 

SCHEDULE 2

 

CONDITIONS
PRECEDENT DOCUMENTS

 

PART 1

 

TO
BE DELIVERED BEFORE THE FIRST ADVANCE

 

1.                                      Constitutional Documents

 

(a)                                  A copy of the articles of association and certificate
of incorporation of each Obligor (other than UPC Financing) and the partnership
agreement in relation to UPC Financing or, if the Facility Agent already has a
copy, a certificate of an authorised signatory of the relevant Obligor
confirming that the copy in the Facility Agent’s possession is still correct,
complete and in full force and effect as at the date of this Agreement.

 

(b)                                 An extract of the registration in the trade register
of the Dutch Chamber of Commerce of each Obligor established in The
Netherlands.

 

2.                                      Authorisations

 

(a)                                  A copy of an extract of a resolution of the managing
or supervisory board of directors (or equivalent) and, to the extent that a
shareholders’ resolution is required under the constitutional documents of any
Obligor established in The Netherlands, a copy of an extract of the shareholders’
resolution of each Obligor:

 

(i)                                     approving the terms of, and the transactions
contemplated by, the Finance Documents to which it is a party (including, in
the case of each Guarantor, the giving of the guarantee under Clause 14
(Guarantee)) and resolving that it execute and, where applicable, deliver the
Finance Documents;

 

(ii)                                  authorising a specified person or persons to execute
and, where applicable, deliver the Finance Documents to which it is a party 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 to which it is a party;

 

(b)                                 a specimen of the signature of each person authorised
by the resolutions referred to in paragraph (a) above;

 

(c)                                  certificate of an authorised signatory of UPC
Distribution certifying that each copy of the documents specified in Part 1 of
this 0 and supplied by UPC Distribution is a true copy and in full force and
effect as at a date no earlier than the Signing Date; and

 

(d)                                 evidence that all of the requirements of
Section 25 of the Netherlands Works Council Act (Wet op de Ondernemingsraden) in connection
with the transactions contemplated by the Finance Documents have been complied
with by each Obligor established in The Netherlands.

 

141

 

3.                                      Legal opinions

 

(a)                                  Legal opinions of:

 

(i)                                     Allen & Overy, London, Amsterdam, Antwerp and New
York, legal advisers to the Facility Agent;

 

(ii)                                  Vinge KB, Stockholm, legal advisers to the Facility
Agent;

 

(iii)                               Wiersholm, Mellbye & Bech, Oslo, legal advisers to
the Facility Agent.

 

4.                                      Finance Documents

 

(a)                                  The Security Documents in Schedule 7 (Security
Documents) duly executed by all parties thereto.

 

(b)                                 The Security Deed duly executed by all parties
thereto.

 

(c)                                  All relevant notices of security required to be
delivered under any Security Document together with acknowledgements of such
notices, in each case in the form required by the relevant Security Document.

 

(d)                                 Delivery to the Security Agent of share certificates
and duly completed blank stock transfer forms (or equivalent) in respect of all
shares or partnership interests (as applicable) subject to the Security
Documents listed in Schedule 7 (Security Documents).

 

(e)                                  UCC-1 Financing Statements duly executed by each of
UPC Holding and UPC Holding II.

 

(f)                                    Completion of all other steps specified by the
Security Agent as being necessary to perfect the Security Interests intended to
be created by the Security Documents listed in Schedule 7 (Security
Documents).

 

5.                                      Financial information

 

(a)                                  Audited consolidated financial statements for UPC for
the financial year ending 31st December, 2002.

 

(b)                                 The Original Borrower Group Financial Statements,
together with the financial statements of the Borrower Group for the Accounting
Period ended 30th September, 2003.

 

6.                                      Other documents

 

(a)                                  A copy of (and of all applications for) any and all
approvals, consents, licences, exemptions and other requirements of
governmental and other authorities required for the entering into or
performance of the Finance Documents to be entered into on or about the Signing
Date by each party.

 

(b)                                 A copy of any other authorisation or other document,
opinion or assurance which the Facility Agent has notified UPC Distribution is
necessary in connection with the entry into and performance of transactions
contemplated by this Agreement or the validity and enforceability of this Agreement.

 

(c)                                  Evidence that all fees, costs and expenses required to
be paid by UPC Distribution on or before the Effective Date pursuant to Clause
21.1 (Transaction Expenses) have been paid.

 

142

 

(d)                                 A duly executed copy of Intercreditor Agreement.

 

(e)                                  A copy of the Business Plan.

 

(f)                                    A copy of a duly executed Verification Letter from
each Facility D Lender.

 

(g)                                 A copy of an amendment to the partnership agreement of
UPC Financing to permit a further assignment of the partnership interest in UPC
Financing to be granted.

 

(h)                                 A copy of a deed of amendment to the articles of
association of UPC Nederland B.V. permitting the entry into of further security
agreements and the related notulen
and evidence of the execution and delivery to the Ministry of Justice in the
Netherlands of the deed of amendment and notulen.

 

(i)                                     A statement signed on behalf of United Pan-Europe
Communications Norge AS confirming that it has not received any notifications
of pledges other than the share pledge dated 31st October, 2000
granted to TD Bank Europe Limited as security agent under the Existing Facility
Agreement.

 

(j)                                     A copy of a letter from UPC Services Limited
acknowledging its appointment as agent for service of process relating to any
proceedings before the English courts, in connection with any Finance Document
by each Obligor which is not incorporated in England and Wales.

 

(k)                                  A copy of the Fee Letter.

 

143

 

PART 2

 

TO
BE DELIVERED BY AN ADDITIONAL OBLIGOR

 

1.                                       An Obligor Accession Agreement, duly executed as a
deed (or using any equivalent necessary formality, in the case of an Additional
Obligor incorporated outside the United Kingdom) by the Additional Obligor.

 

2.                                       In the case of an Additional Obligor (other than any
UPC Distribution Holdco), a pledge over all the issued shares of the Additional
Obligor owned by any member of the Borrower Group in substantially the same
form as a share pledge already granted to the Security Agent over shares of
another Obligor incorporated in the same jurisdiction as the Additional Obligor
or in such other form as the Security Agent may reasonably require, together
with a Security Provider’s Deed of Accession executed by such member of the Borrower
Group, such notices and other documents as the Security Agent may require to
perfect such share pledge.

 

3.                                       Details of:

 

(a)                                  (in the case of an Additional Obligor, other than any
UPC Distribution Holdco) all material receivables (aggregating €10,000,000 (or
its equivalent in other currencies) or more) which are owed to the Additional
Obligor by chello broadband N.V. or Priority Telecom N.V.;

 

(b)                                 (in the case of, an Additional Obligor, other than UPC
Distribution Holdco) all intercompany loans owed to the Additional Obligor by
any member of the Borrower Group, together with an Obligor Pledge of
Shareholder Loans executed by the Additional Obligor in respect of such
intercompany loans and the other documents referred to in Clause 16.14 (Loans and
guarantees);

 

(c)                                  where the Additional Guarantor will become a UPC
Distribution Holdco at the same time as, or after, it becomes an Additional
Guarantor, details of all Financial Indebtedness owing to the Additional
Guarantor by any member of the Borrower Group, together with a Pledge of
Subordinated Shareholder Loans executed by the Additional Guarantor in respect
of such Financial Indebtedness and the other documents referred to in Clause
16.25(a) (Shareholder Loans); and

 

(d)                                 (in the case of an Additional Obligor, other than any
UPC Distribution Holdco) all Financial Indebtedness owing by the Additional
Obligor to any Restricted Person, together with a Pledge of Subordinated
Shareholder Loans executed by the relevant Restricted Person(s) (if any) in respect
of such Financial Indebtedness and the other documents referred to in Clause
16.25(a) (Shareholder Loans).

 

4.                                       A pledge over such of the receivables referred to in
sub-paragraph 3(a) above (in the case of an Additional Obligor, other than any
UPC Distribution Holdco) as in the opinion of the Security Agent is necessary
to maintain the coverage of the Security Documents over such receivables owed
to the Borrower Group on a basis consistent with Clause 16.26 (Further security
over receivables) in substantially the same form as a receivables pledge
already granted to the Security Agent (i) by a member of the Borrower Group
incorporated in the same jurisdiction as the Additional Obligor or (ii) in
respect of receivables located in the same jurisdiction as the relevant
receivables or (iii) in such other form as the Security Agent may reasonably
request, together with all such notices and other documents as the Security
Agent may require to perfect the receivables pledge.

 

144

 

5.                                       A copy of the memorandum and articles of association
and certificate of incorporation (or other equivalent constitutional documents)
of the Additional Obligor (and any Subsidiary of the Additional Obligor, the
issued shares of which are to be subject to a share pledge referred to in
paragraph 6 below).

 

6.                                       (a)                                  Where the Additional Guarantor will become a UPC
Distribution Holdco at the same time as, or after, it becomes an Additional
Guarantor, a pledge over all the issued shares of UPC Distribution
substantially in the same form as a share pledge already granted to the
Security Agent over shares of UPC Distribution or in such other form as the
Security Agent may reasonable require, together with such notices and other
documents as the Security Agent may require to perfect such share pledge.

 

(b)                                 In the case of an Additional Obligor (other than any
UPC Distribution Holdco), a pledge over all the issued shares of any Subsidiary
(a Relevant Subsidiary) of the
Additional Obligor (other than shares not owned by the Additional Obligor or
any Subsidiary of the Additional Obligor) if in the opinion of the Security
Agent such pledge is necessary to maintain the coverage of the Security
Documents over shares in Obligors (other than UPC Holding and any other UPC
Distribution Holdco) or other key members of the Borrower Group (being holding
companies in respect of one or more members of the Borrower Group which carry
on business in a particular jurisdiction). 
Such share pledge shall be in substantially the same form as a Share
Pledge already granted to the Security Agent over shares in a person
incorporated in the same jurisdiction as the Relevant Subsidiary or in such
other form as the Security Agent may reasonably require, together with such
notices and other documents as the Security Agent may require to perfect such
pledge.

 

7.                                       A copy of a resolution of the board of directors of
the Additional Obligor:

 

(a)                                  approving the terms of, and the transactions
contemplated by, the Obligor Accession Agreement (and any relevant Security
Document referred to in paragraphs 2, 3, 4 or 6 above (each an Additional Security Document) resolving
that it execute the Obligor Accession Agreement (and each Additional Security
Document);

 

(b)                                 authorising a specified person or persons to execute
the Obligor Accession Agreement and each Additional Security Document; 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 the Finance Documents.

 

8.                                       A copy of any other authorisation or other document,
opinion or assurance which the Facility Agent reasonably considers to be
necessary in connection with the entry into and performance of, and the
transactions contemplated by, the Obligor Accession Agreement or any Additional
Security Document.

 

9.                                       A specimen of the signature of each person authorised
by the resolution referred to in paragraph 7 above.

 

10.                                 A certificate of an authorised signatory of the
Additional Obligor certifying that each copy of the documents specified in Part
2 of this 0 and provided by it is a true copy and in full force and effect as
at a date no earlier than the date of the Obligor Accession Agreement (and, in
the case of an Additional Obligor other than any UPC Distribution Holdco, if
required by the Facility Agent, a certificate of each Relevant Subsidiary in
respect of each copy of the documents provided by it in accordance with the
provisions of Part 2 of this 0).

 

145

 

11.                                 A copy of the latest financial statements (audited, if
available) of the Additional Obligor.

 

12.                                 A legal opinion of legal advisers to the Facility
Agent, and, if applicable, other lawyers approved by the Facility Agent in the
place of incorporation of the Additional Obligor (and/or each Relevant
Subsidiary) addressed to the Finance Parties.

 

13.                                 All other notices, documents and other steps required
to perfect the security constituted by each Additional Security Document
(including, without limitation, accession to, or entry into (as the case may
be), by:

 

(a)                                  the relevant Additional Obligor (and any member of the
Borrower Group which is an intercompany debtor in respect of the Additional
Obligor) of an Obligors’ Framework Agreement; or

 

(b)                                 as the case may be, the relevant Restricted Person
referred to sub-paragraph 3(d) above (and the Additional Obligor) of a
Restricted Person’s Framework Agreement.

 

146

 

SCHEDULE 3

 

MANDATORY COST FORMULAE

 

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

 

2.                                       On the first day of each Interest Period (or as soon
as possible thereafter) the Facility Agent shall calculate, as a percentage
rate, the arithmetic mean (rounded up, if necessary, to four decimal places) of
the respective rates notified by each Reference Bank to the Facility Agent at
its request as the rate resulting from the application of the formulae set out
in paragraphs 3 and 4 below (the Additional
Cost Rate).

 

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

 

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

 

in relation to
an Advance in any currency other than sterling:

 

	
  E X 0.01

  	
   

  	
  per cent. per annum.

  
	
  300

  

 

Where:

 

E                                         is designed to compensate the Reference Banks for
amounts payable under the Fees Rules (but, for this purpose, ignoring any
minimum fee required pursuant to the Fees Rules) and is calculated by the
Facility Agent as being the average for the most recent rates of charge
supplied by the Reference Banks to the Facility Agent pursuant to paragraph 6
below and expressed in pounds per £1,000,000.

 

5.                                       For the purposes of this Schedule:

 

(a)                                  Fees Rules means the rules on periodic fees contained in the FSA
Supervision Manual or such other law or regulation as may be in force from time
to time in respect of the payment of fees for the acceptance of deposits;

 

(b)                                 Fee Tariffs means the fee tariffs specified in the Fees Rules
under the activity group A.1 Deposit acceptors (ignoring any minimum fee or
zero rated fee required pursuant to the Fees Rules but taking into account any
applicable discount rate; and

 

(c)                                  Tariff Base has the meaning given to it in, and will be calculated
in accordance with, the Fees Rules.

 

6.                                       If requested by the Facility Agent, each Reference
Bank shall, as soon as practicable after publication by the Financial Services
Authority, supply to the Facility Agent, the rate of

 

147

 

charge payable
by that Reference Bank to the Financial Services Authority pursuant to the Fees
Rules in respect of the relevant financial year of the Financial Services
Authority (calculated for this purpose by that Reference Bank as being the
average of the Fee Tariffs applicable to that Reference Bank for that financial
year) and expressed in pounds per £1,000,000 of the Tariff Base of that
Reference Bank.

 

7.                                       Each Lender shall supply any information required by
the Facility Agent for the purpose of calculating its Additional Cost
Rate.  In particular, but without
limitation, each Lender shall supply the following information on or prior to
the date on which its becomes a Lender:

 

(a)                                  the jurisdiction of its Facility Office; and

 

(b)                                 any other information that the Facility Agent may
reasonably require for such purpose.

 

Each Lender
shall promptly notify the Facility Agent of any change to the information
provided by it pursuant to this paragraph.

 

8.                                       The rates of charge of each Reference Bank for the
purpose of E above shall be determined by the Facility Agent based upon the
information supplied to it pursuant to paragraphs 6 and 7 above.

 

9.                                       The Facility Agent shall have no liability to any
person if such determination results in an Additional Cost Rate which over or
under compensates any Lender and shall be entitled to assume that the
information provided by any Reference Bank pursuant to paragraph 3 above is
true and correct in all respects.

 

10.                                 The Facility Agent shall distribute the additional
amounts received as a result of the Mandatory Costs to the Lenders on the basis
of the Additional Cost Rate for each Lender based on the information provided
by each Reference Bank pursuant to paragraphs 3, 6 and 7 above.

 

11.                                 Any determination by the Facility Agent pursuant to
this Schedule in relation to a formula, the Mandatory Cost, an Additional
Cost Rate or any amount payable to a Lender shall, in the absence of manifest
error, be conclusive and binding on all Parties.

 

12.                                 The Facility Agent may from time to time, after
consultation with UPC Distribution and the Lenders, determine and notify to all
Parties any amendments which are required to be made to this Schedule in
order to comply with any change in law, regulation or any requirements from
time to time imposed by the Bank of England, the Financial Services Authority
or the European Central Bank (or, in any case, any other authority which
replaces all or any of its functions) and any such determination shall, in the
absence of manifest error, be conclusive and binding on all Parties.

 

148

 

SCHEDULE 4

 

FORM
OF REQUEST AND CANCELLATION NOTICE

 

PART 1

 

FORM OF REQUEST

 

To:                              [                                      ]

 

Attention:              [                    ]

 

From:                  UPC Distribution Holding B.V.

 

Date:
[                    ]

 

REQUEST (ADVANCE)

 

UPC Distribution Holding B.V. - €1,072,000,000 Term
Credit Agreement dated [      ] January, 2004
(the Credit Agreement)

 

Dear Sirs,

 

We hereby give you notice pursuant to Clause 5.1
(Delivery of Request) of the above Credit Agreement that we require an Advance
to be made to that Borrower under the Credit Agreement, as follows:

 

	
  (a)

  	
   

  	
  Facility:

  	
   

  	
  [Facility D1, Facility D2, Facility D3,
  Facility D4, Facility D5 or relevant Additional Facility]

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (b)

  	
   

  	
  Utilisation Date:

  	
   

  	
  [31st December, 2004, 30th June, 2005, 31st
  December, 2005, 30th June, 2006, 31st December, 2006 or a date falling within
  the relevant Additional Facility Availability Period]

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (c)

  	
   

  	
  Requested Amount:

  	
   

  	
  [                    ]

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  [(d)

  	
   

  	
  Currency:

  	
   

  	
  [                    ]]

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (e)

  	
   

  	
  Interest Period:

  	
   

  	
  [                    ]

  

 

[Payment instructions with respect to the proceeds of
the Advance to be made in relation to this Request are as follows: 
[                    ].]*

 

We confirm that each condition specified in Clause 4.2
(Further conditions precedent) is satisfied on the date of this Request. [In
particular, we confirm that the proceeds of the Advance will be applied [specify purpose] in accordance with Clause
3.1 (Purpose).]

 

*              Delete if
Clause 5.6 applies to the Advance

 

149

 

Terms used in this Request and defined in the Credit
Agreement have the same meaning in this Request as in the Credit Agreement.

 

Yours faithfully

 

[Authorised Signatory]

 

[Borrower]

 

150

 

PART 2

 

FORM
OF CANCELLATION AND/OR PREPAYMENT NOTICE

 

To:                              [      ] as Facility
Agent

 

From:                  [BORROWER]

 

Date:                    [            ]

 

UPC Distribution Holding B.V. - €1,072,000,000 Term
Credit Agreement dated [      ] January, 2004

 

1.                                       [We wish to cancel a portion of Total Facility D1
Commitments* and/or*/Total Facility D2 Commitments* and/or* Total
Facility D3 Commitments* and/or* Total Facility D4 Commitments and/or* Total
Facility D5 Commitments in the following amounts:

 

Cancellation:

 

Total Facility
D1 Commitments:                                                                          [       ]*

 

Total Facility
D2 Commitments:                                                                          [       ]*

 

Total Facility
D3 Commitments:                                                                          [       ]*

 

Total Facility
D4 Commitments:                                                                          [       ]*

 

Total Facility
D5 Commitments:                                                                          [       ]*

 

Total Additional
Facility Commitments:                                [       ]*

 

OR

 

[We wish to
prepay the whole or part of the following Advances which are to be applied
against the Facilities in the following order:

 

(a)                                  Facilities:

 

Facility D1
Advance:                                                                                [       ]*

 

Facility D2
Advance:                                                                                [       ]*

 

Facility D3
Advance:                                                                                [       ]*

 

Facility D4
Advance:                                                                                [       ]*

 

Facility D5
Advance:                                                                                [       ]*

 

Additional
Facility Advance:                                                                                      [       ]*

 

*                                         Delete
as appropriate.

 

151

 

(b)                                 Application of Advance[s]:

 

Facility D1:                                                                                    [       ]*

 

Facility D2:                                                                                    [       ]*

 

Facility D3:                                                                                    [       ]*

 

Facility D4:                                                                                    [       ]*

 

Facility D5:                                                                                    [       ]*

 

Additional
Facility:              [       ]*

 

2.                                       Terms defined in the above Credit Agreement have the
same meaning in this notice.

 

By:

 

[BORROWER]

 

Authorised Signatory

 

152

 

SCHEDULE 5

 

FORMS OF ACCESSION DOCUMENTS

 

PART 1

 

NOVATION CERTIFICATE

 

	
  To:

  	
   

  	
  [      ] as
  Facility Agent and [BORROWER]

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  From:

  	
   

  	
  [THE EXISTING LENDER] and [THE NEW LENDER]

  	
   

  	
  Date:
  [        ]

  

 

UPC Distribution Holding B.V. - €1,072,000,000 Term
Credit Agreement dated [    ] January, 2004 (the Credit
Agreement)

 

We refer to Clause 26.3 (Procedure for novations) of
the Credit Agreement and clause 9.3 (Transfers by the Lenders) of the Security
Deed.  Terms defined in the Credit
Agreement have the same meaning in this Novation Certificate.

 

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 26.3 (Procedure for
novations) of the Credit Agreement and clause 9.3 (Transfers by the Lenders) of
the Security Deed.

 

2.                                       On the date on which this novation becomes effective
in accordance with Clause 26.3 (Procedure for novations), the New Lender
represents and warrants to the Existing Lender, the Finance Parties and UPC
Distribution that it is [a Professional Market Party]/[exempted from the
requirement to be a Professional Market Party because it forms part of a closed
circle (besloten kring) with UPC
Distribution].

 

3.                                       The New Lender represents that it is in compliance
with Clause 26.2(a)(ii) (Transfers by Lenders) [by entering into a Relevant
Facility B Sub-participation Agreement with the Existing Lender/insert details of compliance].

 

4.                                       The Facility Office and address for notices of the New
Lender for the purposes of Clause 32.2 (Addresses for notices) are set out in
the Schedule.

 

5.                                       This Novation Certificate 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 Novation Certificate.

 

6.                                       This Novation Certificate is governed by English law.

 

153

 

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 for administrative
  purposes

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Address for notices for credit purposes]

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  [Existing Lender]

  	
   

  	
  [New Lender]

  	
  [                ]

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
  By:

  	
  By:

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Date:

  	
   

  	
  Date:

  	
  Date:

  	
   

  

 

154

 

PART 2

 

SUB-PARTICIPATION AGREEMENT

 

Date:

 

GRANTOR:

 

PARTICIPANT:

 

This Funded Participation is entered into between the
Grantor and the Participant (acting directly or through their respective
agents).

 

On and from the Settlement Date the Grantor grants to
the Participant a participation under which (amongst other things) the
Participant undertakes to pay to the Grantor, on the Settlement Date, the
Settlement Amount in order to enable the Grantor to fund part of the Facility B
Loans subject to:

 

(c)                                  the terms and conditions annexed hereto; and

 

(d)                                 the schedule annexed hereto;

 

both of which are incorporated herein by reference.

 

 

	
  The Grantor

  	
   

  	
  The Participant

  
	
   

  	
   

  	
   

  
	
  [                            ]

  	
   

  	
  [                                  ]

  
	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
  By:

  

 

155

 

THE SCHEDULE

 

	
  Credit Agreement Details

  	
   

  	
   

  
	
  Borrower(s):

  	
   

  	
  UPC Distribution Holding B.V. (“UPC Distribution”)

  
	
  Credit Agreement Dated:

  	
   

  	
  26th October, 2000 (as amended from time to
  time)

  
	
  Guarantor(s):

  	
   

  	
  The Guarantors listed in Part 1 of
  Schedule 1 to the Credit Agreement, together with any Additional
  Guarantors

  
	
  Agent Bank:

  	
   

  	
  TD Bank Europe Limited

  
	
  Security:

  	
   

  	
  Yes (as constituted by the Security
  Documents)

  
	
  Total Facility Amount:

  	
   

  	
  €3,595,000,000 and US$347,500,000

  
	
  Governing Law:

  	
   

  	
  English

  
	
  Additional Information:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Participation Details:

  	
   

  	
   

  
	
  Participated Tranches/Facilities:

  	
   

  	
  each of the Facility B Repayment Instalments
  which are scheduled to be paid by the Borrower on the following Repayment
  Dates for Facility B (each a “Relevant
  Facility B Repayment Date”):

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  [      ] 31st
  December, 2004

  
	
   

  	
   

  	
  [      ] 30th
  June, 2005

  
	
   

  	
   

  	
  [      ] 31st
  December, 2005

  
	
   

  	
   

  	
  [      ] 30th
  June, 2006

  
	
   

  	
   

  	
  [      ] 31st
  December, 2006

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  [tick the
  dates of the Facility B Repayment Instalments which correspond to the
  Utilisation Dates of the Facility D Commitments under the New Facility
  Agreement that are being assigned, transferred or novated to the Participant
  (the “Traded Facility D Commitments”)
  at the same time as this Funded Participation is entered into.]

  
	
  Name of Tranche/Facility:

  	
   

  	
  Facility B

  
	
  Nature (Revolving or Term):

  	
   

  	
  Term

  
	
  Contractual Margin(1):

  	
   

  	
  [     ]

  
	
  Recurring Fees:

  	
   

  	
  [     ]

  
	
  Final Maturity:

  	
   

  	
  For each Participated Tranche, the Relevant
  Facility B Repayment Date

  
	
  Participation Commitment:

  	
   

  	
  [for each
  Participated Tranche, insert amount of the Participated Tranche which is to
  be sub-participated to the Participant under this Funded Participation]

  
	
  Settlement Date

  	
   

  	
  [this must
  match the date of the assignment, transfer or novation of the Traded Facility
  D Commitments]

  

 

	
  Details of outstanding
  Facility B Loans(1)

  	
   

  	
   

  
	
  Specify in respect of each Facility B Loan:

  	
   

  	
   

  
	
  Drawn amount:

  	
   

  	
  [     ]

  
	
  Tranche/Facility:

  	
   

  	
  Facility B

  

 

(1)                          As at
the date of the Funded Participation

 

156

 

	
  Nature:

  	
   

  	
  Term

  
	
   

  	
   

  	
   

  
	
  Costs and Expenses

  	
   

  	
  For account of Grantor and Participant in
  accordance with Clause 13(d)

  
	
   

  	
   

  	
   

  
	
  Administration Details

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Grantor’s Receiving Account:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Participant’s Receiving Account:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Addresses

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Grantor

  	
   

  	
  Participant

  
	
  [                                        ]

  	
   

  	
  [                                        ]

  
	
   

  	
   

  	
   

  
	
  Address:

  	
   

  	
  Address:

  
	
  Telephone:

  	
   

  	
  Telephone:

  
	
  Facsimile:

  	
   

  	
  Facsimile:

  
	
  Telex:

  	
   

  	
  Telex:

  
	
  Attn/Ref:

  	
   

  	
  Attn/Ref:

  
	
   

  	
   

  	
   

  
	
  Process Agent

  	
   

  	
   

  
	
  Grantor

  	
   

  	
   

  
	
  Participant

  	
   

  	
   

  

 

157

 

TERMS AND CONDITIONS

 

These are the Terms and Conditions applicable to the
funded participation including the Schedule thereto (the Funded Participation) to which they are
annexed.

 

1.                                      INTERPRETATION

 

1.1                               Definitions

 

In these Terms
and Conditions words and expressions shall (unless otherwise expressly defined
herein) bear the meaning given to them in the Schedule or (as applicable)
the Credit Agreement and:

 

Borrower means UPC Distribution;

 

Business
Day means a day (other
than a Saturday or Sunday) on which banks generally are open for business in
any financial centre appropriate for the transaction described in the Funded
Participation;

 

Commitment means, in relation to any Participated Tranche at any
time, the amount of the relevant Facility B Repayment Instalment which at that
time is scheduled to be paid to the Grantor on the Relevant Facility B
Repayment Date;

 

Credit
Documentation means the Credit
Agreement, together with all schedules and appendices thereto, any amendments
or variations thereto and all ancillary guarantee and security documentation;

 

General
Debt Restructuring means any
rescheduling, restructuring or re-organisation of the indebtedness (or of any
class of the indebtedness) of any Obligor which satisfies the following tests:

 

(a)                                  the holders of more than half of that indebtedness or
of any class of that indebtedness participate in or agree to the same; and

 

(b)                                 the same arises in relation to any actual or purported
insolvency, payments difficulty, moratorium, exchange control or transfer
restrictions, withholding of foreign currency payments or similar circumstance;

 

Guarantor means any person who has given a guarantee,
indemnity, security interest or other assurance against loss to the Grantor (or
any person acting on the Grantor’s behalf) in respect of any obligations of the
Borrower to the Grantor in relation to any Participated Tranche or Facility B
Loan;

 

Interest means, unless the context otherwise requires, all
interest received by or accruing to the Grantor in respect of any Facility B
Loan;

 

Facility
B Loan means the principal
amount of any borrowing made by UPC Distribution from the Grantor under
Facility B (including interest compounded thereunder and treated as principal)
or the principal amount outstanding of that borrowing;

 

New
Facility Agreement means the e1,072,000,000 facility agreement dated [     ] made between, inter alia, UPC Distribution as borrower,
TD Bank Europe Limited as facility agent

 

158

 

and security
agent and the banks and financial institutions listed therein, as amended from
time to time;

 

Obligor means any Borrower or Guarantor;

 

Participant’s
Facility B Proportion means the
proportion (expressed as a percentage) borne by the aggregate of the
Participation Commitments to the aggregate of all the Grantor’s drawn Facility
B Commitments from time to time under the Credit Agreement;

 

Participant’s
Global Proportion means the
proportion (expressed as a percentage) borne by the aggregate of the
Participation Commitments to the aggregate of all the Grantor’s drawn and
undrawn commitment from time to time under the Credit Agreement;

 

Participant’s
Proportion means, in relation to
any Participated Tranche, the proportion (expressed as a percentage) borne by
the relevant Participation Commitment to the relevant Commitment;

 

Participated
Tranche means any Facility B
Repayment Instalment in respect of which the Participant is granted a
participation under the Funded Participation, as set out in the Schedule;

 

Participation means the participation in the funding of the
Facility B Loans accepted by the Participant under the Funded Participation;

 

Participation
Commitment means, in relation to
a Participated Tranche, the amount specified as such in the Schedule less
an amount equal to the Participant’s Proportion of any amount of the relevant
Facility B Repayment Instalment permanently prepaid and cancelled from time to
time pursuant to the Credit Agreement;

 

Party means a party to the Funded Participation;

 

[Pricing Letter means the letter agreement
between the Parties dated the date of the Funded Participation and containing,
among other things, details of the Settlement Amount and Traded Margin(s);]

 

Purchased
Assets means the Facility B
Loans and related rights of i the Grantor under Facility B, as set out in the
Credit Documentation, to the extent that such Facility B Loans and other rights
form part of this Funded Participation, together with and subject to the
obligations and liabilities of the Grantor under the Credit Documentation
attributable to such Facility B Loans (together with corresponding rights under
any ancillary guarantee or security);

 

Receiving
Account means the account of a
Party designated as its Receiving Account as specified in the Schedule;

 

Relevant
Period means in respect of
any Facility B Loan which is outstanding on the Settlement Date, any period
which commences on or after the Settlement Date or, in relation to any period
which commences before the Settlement Date, that part of such period which
falls on or after that date;.

 

Settlement
Amount means the amount to be
paid by the Participant to the Grantor on the Settlement Date [as specified in
the Pricing Letter]; and

 

Settlement
Date means the date
specified as such in the Schedule.

 

159

 

1.2                               Construction

 

(a)                                  In the Funded Participation and these Terms and
Conditions unless the contrary intention appears, a reference to:

 

(i)                                     a Clause is a reference to a clause of these Terms and
Conditions;

 

(ii)                                  the Schedule is a reference to the
schedule to the Funded Participation; and

 

(iii)                               a person includes its successors and assigns.

 

(b)                                 The headings in these Terms and Conditions are for
convenience only and are to be ignored in construing them.

 

(c)                                  References to any document shall be references to the
same as amended, varied, supplemented, replaced and restated in any manner from
time to time.

 

1.3                               Third Party Rights

 

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

 

2.                                      PARTICIPANT’S SUBSEQUENT OBLIGATIONS

 

If at any time
on or after the Settlement Date a sum falls due from the Grantor under the
Credit Documentation and the sum is, in the Grantor’s reasonable opinion,
attributable in whole or in part to any Facility B Loan, then the Participant
shall pay to the account of the Grantor an amount equal to the relevant
Participant’s Facility B Proportion of such sum in the currency and funds and
in the place and time at which the Grantor is required to make the payment
under the Credit Documentation.

 

3.                                      PAYMENTS

 

3.1                               Receipts

 

The Grantor
shall be entitled to receive, recover and retain all principal, interest and
other money payable under the Credit Documentation in relation to each
Participated Tranche.

 

3.2                               Payments

 

Subject to
compliance by the Participant with its obligations under the Funded
Participation, on and after the Settlement Date the Grantor shall, upon applying
any amount actually received by it in respect of any Facility B Loan or
Facility B Commitment (whether by way of actual receipt, the exercise of any
right of set-off or otherwise), pay to the Participant:

 

(a)                                  if that amount is applied against the outstanding
principal amount of a Facility B Repayment Instalment due on a Relevant
Facility B Repayment Date, an amount equal to the relevant Participant’s
Proportion of the amount applied by the Grantor;

 

(b)                                 if that amount is applied in satisfaction of Interest
accruing on a Facility B Loan (or default interest accruing on a Facility B
Loan, on any Interest or on any other amount in respect of which the
Participant has made a payment under Clause 2) in respect of any Relevant
Period, an amount equal to the relevant Participant’s Facility B Proportion of
the amount so applied; and

 

160

 

(c)                                  if that amount is applied in respect of any
commission, fees or any other amount relating to any Facility B Loan or any
Facility B Commitment in respect of any Relevant Period (except any
underwriting or arrangement or other non-recurring fees), an amount equal to
the relevant Participant’s Facility B Proportion of the amount so applied.

 

3.3                               Non-attributable sums

 

If any sum which
is received or recovered under the Credit Documentation is not attributable to
any particular amount due under the Credit Documentation, that sum will be
applied (after payment of any expenses incurred in its collection) by the
Grantor towards such obligations of the relevant Obligor as it may determine.

 

4.                                      PAYMENTS ADMINISTRATION

 

4.1                               Place

 

All payments or
deposits by either Party to, or with, the other under the Funded Participation
shall be made to the Receiving Account of that other Party.  Each Party may designate a different account
as its Receiving Account for payment by giving the other not less than five
Business Days notice before the due date for payment.

 

4.2                               Funds and currency

 

(a)                                  Subject to paragraph (b) below, payments under the Funded
Participation shall be made in the currency in which the amount is denominated
for value on the due date at such times and in such funds as are customary at
the time for settlement of transactions in that currency.

 

(b)                                 Where the Grantor’s obligation to make a payment under
the Funded Participation arises from receipt or recovery of an amount pursuant
to the Credit Documentation the Grantor shall make the payment in the currency
and funds in which those monies were received or recovered and, if that currency
is not the currency of the country where the designated Receiving Account of
the Participant is located, it shall be made to the account of the Participant
in the principal financial centre of the country of that currency specified by
the Participant.

 

4.3                               Set-off and counterclaim

 

All payments by
a Party shall be made without set-off or counterclaim other than in respect of
amounts which are due to that Party under the Funded Participation.

 

4.4                               Withholding

 

(a)                                  All payments by the Grantor under the Funded
Participation shall be made net of any deduction or withholding required to be
made from such payments by any law, regulation or practice.  If any such deduction or withholding is
made, the Participant shall bear the risk of such deduction or withholding and
shall be deemed to have received the amount that it would have received if such
deduction or withholding had not been made.

 

(b)                                 All payments by the Participant under the Funded
Participation shall be made free and clear of any deduction or withholding save
for such deduction or withholding as may be required to be made from such
payments by any law, regulation or practice.

 

161

 

If any such
deduction or withholding is made or is required to be made the Participant
shall increase the amount to be paid to the Grantor to ensure that the Grantor
receives and retains a sum equal to the sum which it would have received and so
retained had no such deduction or withholding been made or required to be made.

 

(c)                                  Both the Grantor and the Participant shall use their
reasonable endeavours to avoid any obligation to make any such deduction or
withholding as is referred to in Clause 4.4(a) and (b).

 

4.5                               Failure to remit

 

The Grantor
shall not be (i) responsible for any loss or liability arising out of its
failure, or the failure of its relevant branch, owing to causes outside its
control (such as, but not limited to, the imposition of foreign exchange
restrictions) to remit to the Participant any amount due to it under the Funded
Participation or (ii) save as otherwise provided below or in Clause 4.6, liable
to remit to the Participant any amount greater than the relevant Participant’s
Proportion of any amount it receives from any Obligor in respect of any Participated
Tranche (in the case of principal amounts) or the relevant Participant’s
Facility B Proportion of any amount if received from any Obligor in respect of
any Facility B Commitment or Facility B Facility B Loan (in all other cases).  If the Grantor fails to make a payment to
the Participant for the reasons set out in paragraph (i), then interest shall
accrue (as well after as before judgment) on the unpaid balance of the sum from
day to day at the rate (as determined by the Participant) which is being offered
by leading banks in the relevant interbank market for overnight deposits in the
currency of and for an amount equal to the unpaid balance.  Interest shall be payable by the Grantor at
the end of each day and, for the purposes of this Clause 4.5, shall constitute
part of the unpaid balance to the extent it is not paid.

 

4.6                               Default interest

 

If either party
(the payer) fails to pay in full
any sum due from it under the Funded Participation to the other party (the payee) on the due date for payment of the
sum, then interest shall accrue (as well after as before judgment) on the
unpaid balance of the sum from day to day at a rate which is two per cent. per
annum over the rate (as determined by the payee) which is being offered by
leading banks in the relevant interbank market for overnight deposits in the
currency of and for an amount equal to the unpaid balance.  Interest shall be payable by the payer at
the end of each day and, for the purposes of this Clause 4.6, shall constitute
part of the unpaid balance to the extent it is not so paid.

 

5.                                      INFORMATION

 

To the extent
that it is lawfully able to do so without breaching any duty of confidentiality
or other obligation owed to any person, the Grantor shall promptly provide the
Participant with copies of all communications and documents it receives under
the Credit Documentation.

 

6.                                      NON-RELIANCE AND INDEPENDENT
INVESTIGATION

 

6.1                               Independent investigation

 

Each Party
acknowledges to the other that it is a sophisticated Participant or Grantor (as
the case may be) with respect to the Funded Participation and has such
information as it deems appropriate under the circumstances (however obtained),
concerning for example the business and financial condition of the Obligor(s)
under the Credit Agreement, to make an informed decision regarding the
transaction.  Each of the Participant
and the Grantor hereby agrees that it has independently made its own analysis
(including its own tax analysis) and decision to

 

162

 

enter into the
Funded Participation, based on such information as it has deemed appropriate
under the circumstances, and without reliance on the other Party (except for
reliance on any express representation made by the other Party hereunder).

 

6.2                               Non-reliance

 

In addition, the
Grantor does not make, and the Participant does not rely upon, any
representation, warranty or condition (express or implied) about, and the
Grantor shall have no liability or responsibility to the Participant for, the
effectiveness, validity or enforceability of the Credit Documentation, or other
documentation delivered by the Grantor to the Participant, or any of the terms,
covenants or conditions contained in the Credit Documentation or other
documentation, or any non-performance by any party to it, or the financial
condition of any Obligor under the Credit Documentation.

 

6.3                               No obligation to support losses

 

The Grantor
notifies the Participant and the Participant acknowledges that:

 

(a)                                  the Grantor shall have no obligation to repurchase or
reacquire all or any part of the Purchased Assets from the Participant or to
support any losses directly or indirectly sustained or incurred by the
Participant for any reason whatsoever, including the non-performance by any
Obligor under the Credit Documentation of its obligations thereunder (other
than any loss caused by the gross negligence or wilful default of the Grantor
in performing its obligations under the Funded Participation); and

 

(b)                                 any rescheduling or renegotiation of the Purchased Assets
shall be for the account of, and the responsibility of, the Participant, who
will be subject to the rescheduled or renegotiated terms.

 

6.4                               Information

 

Each of the
Participant and Grantor acknowledges that the other may possess material
information not known to it.  Each
agrees that the other shall have no liability with respect to the
non-disclosure of any such information except to the extent that such
information renders inaccurate an express representation made pursuant to the
Funded Participation by the party possessing such information.

 

7.                                      REPRESENTATIONS AND UNDERTAKINGS

 

7.1                               General representations and
undertakings

 

Each of the
Participant and the Grantor represents and undertakes to the other that:

 

(a)                                  it is duly organised and validly existing under the
laws of the jurisdiction in which it is incorporated;

 

(b)                                 it has the power to enter into the transaction and to
execute and deliver the Funded Participation;

 

(c)                                  its obligations hereunder constitute legal, valid,
binding and enforceable obligations (subject to applicable bankruptcy,
reorganisation, insolvency, moratorium or similar laws affecting creditors’
rights generally and subject, as to enforceability, to equitable principles of
general application); and

 

163

 

(d)                                 in the case of the Participant only, it will not use
any information received by it from the Grantor in relation to the Obligors, or
the Purchased Assets for any unlawful purpose or in breach of any
confidentiality agreement entered into by it in connection with the
transaction.

 

7.2                               Grantor’s additional representations
and undertakings

 

The Grantor
represents and undertakes to the Participant that:

 

(a)                                  as at the Settlement Date it will own beneficially all
the Purchased Assets to be participated hereunder free from any rights of
set-off in favour of any Obligor or any lien, security interest or other
encumbrance, any purchase or option agreement or arrangement, or any agreement
to create or effect any of the same, and it will not be in default of any of
its obligations in relation to the Purchased Assets or the Credit
Documentation;

 

(b)                                 so far as it is aware, no decision has been taken by
the banks party to the Credit Documentation to accelerate or enforce their
rights under the Credit Documentation and no amount of principal or interest is
due and unpaid under the Credit Documentation;

 

(c)                                  save only where the Participant is a party to the
Credit Documentation or where the Participant has confirmed to the Grantor that
the Participant has a copy of the Credit Documentation, it has furnished to the
Participant, or will furnish to the Participant prior to the Settlement Date, a
true and complete copy of the Credit Documentation; and

 

(d)                                 save as otherwise specified hereunder and subject to
the obtaining of any necessary consents, all rights and benefits and, where
applicable, all obligations under the Credit Documentation are to be the
subject of the Funded Participation where such rights, benefits and obligations
are capable of so being and the entry into, the performance of its obligations
and the exercise of its rights under the Funded Participation will not breach
any provision of the Credit Documentation.

 

7.3                               Survival of representations

 

All express
representations made by the parties pursuant hereunder shall survive the
execution and delivery of the Funded Participation.

 

8.                                      STATUS OF PARTICIPATION

 

8.1                               Status of Participation

 

(a)                                  The Grantor does not transfer or assign any rights or
obligations under the Credit Documentation and the Participant will have no
proprietary interest in the benefit of the Credit Documentation or in any
monies received by the Grantor under or in relation to the Credit
Documentation;

 

(b)                                 The relationship between the Grantor and the
Participant is that of debtor and creditor with the right of the Participant to
receive monies from the Grantor restricted to the extent of an amount equal to
the relevant portion of any monies received by the Grantor from any Obligor;

 

164

 

(c)                                  The Participant shall not be subrogated to or
substituted in respect of the Grantor’s claims by virtue of any payment under
the Funded Participation and the Participant shall have no direct contractual
relationship with or rights against any Obligor;

 

(d)                                 Nothing in the Funded Participation constitutes the
Grantor as agent, fiduciary or trustee for the Participant;

 

(e)                                  Nothing in the Funded Participation shall place the
Grantor under an obligation to enquire as to the occurrence or otherwise of an
event of default under the Credit Documentation;

 

(f)                                    Nothing in the Funded Participation shall place the
Grantor under an obligation to exercise any rights of set-off it may have
against any Obligor; and

 

(g)                                 The Grantor’s obligations hereunder shall be subject
to its obligations under the Credit Documentation.

 

8.2                               Credit Documentation

 

Subject to the
proviso contained in Clause 11.5 the Grantor may, without responsibility to the
Participant:

 

(a)                                  exercise or refrain from exercising any or all of its
rights, powers and discretions arising under or in connection with the Credit
Documentation;

 

(b)                                 agree to any variation or waiver of the terms of the
Credit Documentation;

 

(c)                                  and perform any other acts under the Credit
Documentation as it in its discretion sees fit.

 

except that the
Grantor shall not, without the prior written consent of the Participant, take
such action as would result in or any variation to any Relevant Facility B
Repayment Date, or any variation to an amount or a change in the currency of,
any Facility B Repayment Instalment scheduled to be paid on such date.

 

9.                                      CONFIRMATION OF RECEIPTS

 

Where the
obligation of the Grantor to make a payment arises as a result of its having
received an amount from another person, the Grantor is not obliged to make that
payment to the Participant until the Grantor has established that it has
actually received that amount.  However,
the Grantor may assume that the sum has been paid to it in accordance with the
Credit Documentation, and, in reliance on that assumption, make available to
the Participant a corresponding amount or the relevant portion thereof.  If the sum has not been made available but
the Grantor has paid a corresponding amount or the relevant portion thereof to
the Participant, the Participant shall forthwith on demand by the Grantor
refund the corresponding amount or the relevant portion thereof together with
interest on that amount from the date of payment to the date of refund,
calculated at a rate reasonably determined by the Grantor to reflect its costs
of funds.

 

10.                               REFUNDS

 

(a)                                  If the Grantor applies any amount in or towards
satisfaction of an Obligor’s obligations under the Credit Documentation and the
Grantor is, as a result of the application or any payment to the Grantor giving
rise to the application, obliged by

 

165

 

any law, rule or
regulation to make any payment to any person, then the Participant shall, upon
demand by the Grantor, repay to the Grantor a corresponding portion of any
amount paid to the Participant as a result of the application.

 

(b)                                 If under any pro rata sharing, loss-sharing or similar
clause in the Credit Documentation, the Grantor is obliged:

 

(i)                                     to pay a sum to other lenders or their agent under the
Credit Documentation; or

 

(ii)                                  to acquire an interest in any sum owing to any other
lender under the Credit Documentation; or

 

(iii)                               otherwise to share any receipts or recoveries by the
Grantor under the Credit Documentation,

 

then the Grantor
shall not be deemed for the purposes of the Funded Participation to have
received any sum from an Obligor to the extent of that payment, interest
acquired or sharing.  Any interest
acquired shall be deemed to be part of the relevant Facility B Loan, if
applicable.

 

11.                               GENERAL DEBT RESTRUCTURING

 

11.1                        Risk

 

The Participant
will bear the risk of any General Debt Restructuring in relation to the
Participation.

 

11.2                        Blocked payments

 

(a)                                  Subject to paragraph (b) below, the Grantor shall not
be obliged to make any payment to the Participant under the Funded
Participation in respect of:

 

(i)                                     any sum which is paid into a blocked account or is
paid in non-transferable or non-convertible currency until that impediment is
removed;

 

(ii)                                  any sum which is required to be used for a specific
purpose pursuant to a General Debt Restructuring; or

 

(iii)                               any financial or other instrument issued to the
Grantor, (including any instrument issued pursuant to Clause 11.3 (Other
instruments)) in either case in satisfaction or purported satisfaction of any
obligation of an Obligor to make any payment with respect to any Participated
Tranche or Facility B Loan (which payment, if made to the Grantor in the manner
provided for in the Credit Documentation, would have given rise to a liability
on the part of the Grantor to make a corresponding payment to the Participant
under the Funded Participation) unless and until such instrument is disposed
of, redeemed or otherwise realised for cash and where the proceeds of
realisation are not themselves subject to this paragraph (a).

 

(b)                                 The Grantor will endeavour (at the expense of the
Participant) to give the Participant the equivalent pro rata benefit of any sum
(including, without limitation, any amounts received in cash) or instrument
referred to in paragraph (a) above (by way of assignment or otherwise) to the
extent that the Grantor is able to do so and to the extent that the same is, in
the Grantor’s reasonable opinion, attributable to the

 

166

 

Participant’s
Participation in relation to any Participated Tranche (in the case of principal
amounts) or the Participant’s Facility B Participation in relation to any
Facility B Loan (in all other cases).

 

11.3                        Other instruments

 

The Grantor may,
in connection with any General Debt Restructuring, apply for or accept any
note, debenture or other instrument whether debt, equity or otherwise issued or
proposed to be issued by an Obligor or any other person in respect of any
Participated Tranche or Facility B Loan or any part thereof, or any Interest,
commission or fees payable in respect of any Participated Tranche or Facility B
Loan or any part thereof.

 

11.4                        Rescheduling agreement

 

Subject as
provided herein, the Grantor may participate in any agreement in connection with
a General Debt Restructuring and which relates to any principal of, Interest on
or fees in respect of, any Participated Tranche or Facility B Loan.  The Grantor shall give to the Participant
the benefit of the agreement on the same terms (mutatis mutandis) as the Funded
Participation to the extent that payments received and applied by the Grantor
under the agreement are in the Grantor’s reasonable opinion attributable to the
Participant’s Participation in relation to any Participated Tranche (in the case
of principal amounts) or the Participant’s Facility B Participation in relation
to any Facility B Loan (in all other cases).

 

11.5                        New money

 

If, in
connection with any General Debt Restructuring, the Grantor agrees to increase
its exposure (whether by way of additional advances or otherwise), the Grantor
shall not be obliged to account to the Participant under the Funded
Participation until that increased exposure has been paid and satisfied unless
the Participant participates in the increased exposure on the terms of the
Funded Participation (mutatis mutandis) 
Provided that, notwithstanding any other provision of these Terms and
Conditions the Participant shall have no obligation to participate in any such
increased exposure whether in connection with any General Debt Restructuring or
otherwise.

 

12.                               SET-OFF

 

Either Party may
(but is not obliged to) set off any amount due and payable by the other Party
under the Funded Participation against any such amounts due and payable by it
to the other Party thereunder.  The
Party exercising its rights under this provision may effect such currency
exchanges as it considers necessary to implement the set off.

 

13.                               EXPENSES AND INDEMNITY

 

(a)                                  Subject to paragraph (b) below, if the Grantor incurs
any costs or expenses in connection with the Credit Documentation (other than
any costs or expenses in connection with the preparation and negotiation of the
Credit Documentation and other than the Grantor’s normal administrative costs
and expenses prior to the occurrence of an Event of Default under the Credit
Documentation) which are not recovered from the relevant Obligor on demand (Relevant Costs and Expenses), then the
Participant shall forthwith on demand pay to the Grantor an amount equal to the
Participant’s Global Proportion of the Relevant Costs and Expenses.

 

167

 

(b)                                 The Grantor shall pay to the Participant the
Participant’s Global Proportion of any amounts subsequently recovered by the
Grantor in respect of any Relevant Costs and Expenses.

 

(c)                                  At the request of the Participant, the Grantor shall
provide to the Participant as soon as possible reasonably detailed information
regarding any Relevant Costs and Expenses incurred by the Grantor.

 

(d)                                 Unless otherwise specified in the Schedule each
of the Participant and the Grantor shall bear its respective out-of-pocket
costs and expenses (including legal expenses) in connection with the Funded
Participation.

 

(e)                                  Each Party (the Indemnifying
Party) shall, forthwith on demand, indemnify the other Party against
any loss or liability (other than any loss or liability resulting from the
gross negligence or wilful misconduct of the other Party) which the other Party
incurs as a consequence of any breach by the Indemnifying Party of its
obligations under the Funded Participation.

 

14.                               ASSIGNMENT AND TRANSFER

 

(a)                                  The Funded Participation shall be binding upon and
enure to the benefit of each Party and their respective successors and
permitted assigns and transferees provided that neither Party may assign or
transfer its rights under the Funded Participation unless:

 

(i)                                     the prior written consent of the other Party is given;
or

 

(ii)                                  in the case of a transfer by the Participant, at the
same time that the proposed assignment or transfer takes place, there is an
assignment or transfer of an amount of its undrawn Facility D Commitment under
the New Facility Agreement to the extent necessary for the Participant to be in
compliance with the clause 26.2 (Transfers by Lenders) of the New Facility
Agreement.

 

(b)                                 The Participant may not sub-participate its interest
in this Funded Participation.

 

15.                               NOVATION

 

Subject to the
consent of the Grantor (not to be unreasonably withheld (and the Participant
acknowledges that, in determining whether to grant or refuse consent, a
relevant factor may be the creditworthiness of the proposed Transferee)) the
Participant may transfer its rights and obligations under the Funded
Participation to a third party (a Transferee)
by delivery to the Grantor of a Novation Certificate in the form annexed hereto
duly completed and signed by the Participant and the Transferee and with effect
from the date of receipt by the Grantor, or, if later, the date specified in
such certificate:

 

(a)                                  the Grantor and the Participant shall each be released
from further obligations to the other and their respective rights against each
other shall be cancelled;

 

(b)                                 the Grantor and the Transferee shall assume
obligations towards each other and acquire rights against each other which
differ from the rights and obligations so discharged only insofar as the
Grantor and the Transferee have assumed and/or acquired the same in place of
the Grantor and the Participant; and

 

(c)                                  the Transferee shall become a party hereto as the Participant.

 

168

 

16.                               TERMINATION

 

16.1                       Cancelling the Funded Participation

 

If the
Participant breaches any of its material obligations under the Funded
Participation, the Grantor shall (subject to Clause 16.2 (Corresponding
transfer of Facility D) below) have the right to cancel the Funded
Participation by paying to the Participant an amount equal to the relevant
Participant’s Proportion of each Facility B Repayment Instalment funded by the
Participant and once such payment has been made all rights and obligations of
each Party hereunder (other than accrued claims and liabilities including,
without limitation, any rights of the Participant in respect of accrued
interest, commission and fees) shall be cancelled and shall have no further
force or effect.

 

16.2                        Corresponding transfer of Facility D

 

If the Grantor
cancels the Funded Participation as set out in Clause 16.1 (Cancelling the
Funded Participation) the Participant shall, at the same time, transfer by way
of novation to the Grantor its undrawn Facility D Commitment under the New
Facility Agreement (if any) in an amount necessary for the Grantor to be in
compliance with clause 26.2 (Transfers by Lenders) of the New Facility
Agreement following such transfer.

 

17.                               NOTICES

 

17.1                        Giving of notices

 

All notices or
other communications under or in connection with the Funded Participation shall
be given in writing and, unless otherwise stated, may be made by telex or
facsimile.  Any such notice will be
deemed to be given as follows:

 

(a)                                  if by letter, when delivered personally or on actual
receipt; and

 

(b)                                 if by facsimile or e-mail when received in legible
form.

 

However, a
notice given in accordance with the above but received on a non-Business Day or
after business hours in the place of receipt will only be deemed to be given on
the next Business Day in that place.

 

17.2                        Addresses for notices

 

The address,
telex number and facsimile number of each Party for all notices under or in
connection with the Funded Participation are those set out in the
Schedule or any other notified by that Party for this purpose to the other
Party by not less than five Business Days notice.

 

18.                               CONFIDENTIALITY

 

(a)                                  Either Party shall be permitted to make any
disclosures regarding the terms of the Funded Participation (other than the
identity of the counterparty) subject to the requirements of law or regulation
or of the Credit Documentation.

 

(b)                                 The Participant undertakes to keep confidential all
information it receives from the Grantor hereunder or otherwise to the extent
required by the Credit Documentation.

 

169

 

(c)                                  If there is any inconsistency between this clause and
any confidentiality agreement entered into between the parties, the terms of
that confidentiality agreement shall prevail.

 

19.                               FURTHER ASSURANCE

 

Each Party
agrees, at its own expense, to take any further action and to execute any
further documents and/or instruments as the other may reasonably request to
give effect to the Funded Participation.

 

20.                               EXECUTION IN COUNTERPARTS AND BY FAX

 

(a)                                  The Funded Participation may be executed in any number
of counterparts and by the parties hereto on separate counterparts each of
which, when executed and delivered, shall constitute an original, but all the
counterparts shall together constitute but one and the same instrument.

 

(b)                                 Transmission by fax of an executed counterpart of the
Funded Participation shall be deemed to constitute due and sufficient delivery
of such counterpart.  The Participant
and the Grantor shall deliver to each other an original counterpart of the
Funded Participation.

 

20.                               GOVERNING
LAW AND JURISDICTION

 

(a)                                  The Funded Participation 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.

 

(b)                                 Each Party which is not incorporated in the United
Kingdom irrevocably appoints the person specified in the Schedule as
process agent to receive on its behalf service of any action, suit or
proceedings in connection with the Funded Participation.  If any person appointed as process agent
ceases to act for any reason the appointing Party shall notify the other Party
and shall promptly appoint another person incorporated within England and Wales
to act as its process agent.

 

170

 

ANNEX

 

FORM OF TRANSFER CERTIFICATE

 

	
  PARTICIPANT:

  	
   

  	
  Date:

  
	
   

  	
   

  	
   

  
	
  TRANSFEREE:

  	
   

  	
   

  

 

This Transfer Certificate is entered into pursuant to
the Funded Participation.

 

On the Transfer Date, the transfer by way of novation
of the Purchased Assets from the Participant to the Transferee on the terms set
out herein shall become effective subject to:

 

(a)                                  the terms and conditions annexed hereto; and

 

(b)                                 the schedule annexed hereto,

 

both of which are incorporated herein by reference.

 

	
  The Participant

  	
   

  	
  The Transferee

  
	
   

  	
   

  	
   

  
	
  [       ]

  	
   

  	
  [       ]

  
	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
  By:

  

 

171

 

THE SCHEDULE

 

	
  Funded Participation Details

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Grantor:

  	
   

  	
   

  
	
  Participant:

  	
   

  	
   

  
	
  Funded Participation Dated:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Credit Agreement Details

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Borrower(s):

  	
   

  	
  UPD Distribution

  
	
  Credit Agreement Dated:

  	
   

  	
  26th October 2000 (as amended
  from time to time)

  
	
  Guarantor(s):

  	
   

  	
  The Guarantors listed in Part 1 of
  Schedule 1 to the Credit Agreement together with any Additional
  Guarantors

  
	
  Agent Bank:

  	
   

  	
  TD Bank Security Limited

  
	
  Security:

  	
   

  	
  Yes (as constituted by the Security
  Documents)

  
	
  Total Facility Amount:

  	
   

  	
  €3,595,000,000 and US$347,500,000

  
	
  Governing Law:

  	
   

  	
  English

  
	
  Additional Information:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Participation Details:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Participated Tranches/Facilities:

  	
   

  	
  [Tick the dates of all the
  Facility B Repayment Instalments which are the subject of the Funded
  Participation]

  
	
   

  	
   

  	
  [        ]
  31st December, 2004

  
	
   

  	
   

  	
  [        ]
  30th June, 2005

  
	
   

  	
   

  	
  [        ]
  31st December, 2005

  
	
   

  	
   

  	
  [        ]
  30th June, 2006

  
	
   

  	
   

  	
  [        ]
  31st December, 2006

  
	
  Name of Tranche/Facility:

  	
   

  	
  Facility B

  
	
  Nature (Revolving or Term):

  	
   

  	
  Term

  
	
  Contractual Margin:  (1)

  	
   

  	
  %

  	
  %

  
	
  Recurring Fees

  	
   

  	
   

  
	
  Final Maturity:  (1)

  	
   

  	
   

  
	
  Participation Commitment:

  	
   

  	
  [Specify aggregate amount
  of the Participant’s Participation Commitments]

  

 

	
  Details of outstanding
  Facility B Loans(2)

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Specify in respect of each Facility B Loan:

  	
   

  	
   

  
	
  Drawn Amount:

  	
   

  	
  [                        ]

  
	
  Tranche/Facility:

  	
   

  	
  Facility B

  
	
  Nature:

  	
   

  	
  Term

  
	
   

  	
   

  	
   

  
	
  Administration Details

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Grantor’s Receiving Account

  	
   

  	
   

  
	
  Participant’s Receiving Account:

  	
   

  	
   

  

 

(2)                                                     As
at the date of the Transfer Certificate

 

172

 

	
  Addresses

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Participant

  	
   

  	
  Transferee

  
	
  [          ]

  	
   

  	
  [          ]

  
	
   

  	
   

  	
   

  
	
  Address:

  	
   

  	
  Address:

  
	
   

  	
   

  	
   

  
	
  Telephone:

  	
   

  	
  Telephone:

  
	
  Facsimile:

  	
   

  	
  Facsimile:

  
	
  Telex:

  	
   

  	
  Telex:

  
	
  Attn/Ref:

  	
   

  	
  Attn/Ref:

  

 

173

 

TERMS AND CONDITIONS

 

These are the Terms and Conditions applicable to the
transfer certificate including the Schedule thereto (the Transfer Certificate) to which they are
annexed.

 

1.                                      INTERPRETATION

 

In these Terms
and Conditions words and expressions shall (unless otherwise expressly defined
herein) bear the meaning given to them in the Transfer Certificate or the
Funded Participation.

 

2.                                      TRANSFER

 

The Participant
requests the Transferee to accept and procure the transfer by novation of all
of the rights and obligations of the Participant under the Funded Participation
(the Purchased Assets) by
counter-signing and delivering the Transfer Certificate to the Grantor at its
address for the service of notice specified in the Funded Participation.  On the Transfer Date the Transferee shall
pay to the Participant the Settlement Amount [as specified in the pricing
letter between the Participant and the Transferee dated the date of the
Transfer Certificate] and completion of the transfer will take place.

 

3.                                      EFFECTIVENESS OF TRANSFER

 

The Transferee
hereby requests the Grantor to accept the Transfer Certificate as being
delivered to the Grantor pursuant to and for the purposes of the Funded
Participation so as to take effect in accordance with the terms of the Funded
Participation on the Transfer Date or on such later date as may be determined
in accordance with the terms thereof.

 

4.                                      TRANSFEREE’S UNDERTAKING

 

The Transferee
hereby undertakes with the Grantor and the Participant that it will perform in
accordance with its terms all those obligations which by the terms thereof will
be assumed by it after delivery of the Transfer Certificate to the Grantor and
satisfaction of the conditions (if any) subject to which the Transfer
Certificate is to take effect.

 

5.                                      EXCLUDED RIGHTS

 

(a)                                  If any amount to which the Transferee is entitled
pursuant to the Funded Participation is received or recovered by the
Participant, the Participant shall forthwith pay an amount equal to such amount
to the Transferee for same day value together with interest on it from the date
of receipt of the amount to the date of payment, calculated at the overnight
rate charged to the Transferee’s Receiving Account in respect of each day of
that period if the account is or would be in debit and. Pending such payment,
the Participant shall hold that amount on trust for the Transferee.

 

(b)                                 If any amount to which the Participant is entitled
pursuant to the Funded Participation is received or recovered by the
Transferee, the Transferee shall forthwith pay to the Participant for same day
value an amount equal to such amount together with interest on it from the date
of receipt of the amount to the day of payment, calculated at the overnight
rate charged to the Participant’s Receiving Account in respect of each day of
that period if the account is, or would be, in debit and, pending such payment,
the Transferee shall hold that amount on trust for the Participant.

 

174

 

6.                                      PAYMENTS

 

6.1                               Place

 

All payments by
either party to the other under the Transfer Certificate shall be made to the
Receiving Account of that other party. 
Each Party may designate a different account as its Receiving Account
for payment by giving the other not less than five Business Days notice before
the due date for payment.

 

6.2                               Funds

 

Payments under
the Transfer Certificate shall be made in the currency in which the amount is
denominated for value on the due date at such times and in such funds as are
customary at the time for settlement of transactions in that currency.

 

6.3                               Transferee’s Acknowledgments

 

The Participant
notifies the Transferee and the Transferee acknowledges that:

 

(a)                                  the Participant shall have no obligation to repurchase
or reacquire all or any part of the Purchased Assets from the Transferee or to
support any losses directly or indirectly sustained or incurred by the
Transferee for any reason whatsoever, including the non-performance by the
Grantor under the Funded Participation of its obligations thereunder; and

 

(b)                                 any rescheduling or renegotiation of the Purchased
Assets shall be for the account of, and the responsibility of, the Transferee,
who will be subject to the rescheduled or renegotiated terms.

 

6.4                               Assignment of Rights

 

The Transfer
Certificate shall be binding upon and enure to the benefit of each Party and
its successors and permitted assigns provided that neither Party may assign or
transfer its rights thereunder without the prior written consent of the other
Party.

 

6.5                               Third Party Rights

 

Unless expressly
provided to the contrary in the Transfer Certificate (including, without
limitation, these Terms and Conditions) a person who is not a party to the
Transfer Certificate has no rights under the Contracts (Rights of Third
Parties) Act 1999 to enforce or to enjoy the benefit of any term of the
Transfer Certificate (including, without limitation, these Terms and
Conditions).

 

6.6                               Governing Law and Jurisdiction

 

(a)                                  The Transfer Certificate (including,
without limitation, these Terms and Conditions) 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.

 

(b)                                 Each Party irrevocably appoints the
person described as process agent (if any) in the Funded Participation to
receive service of any action, suit or other proceedings in connection with the
Transfer Certificate.  If any person
appointed as process agent ceases to act for any reason the appointing Party
shall notify the other Party and shall

 

175

 

promptly appoint another person
incorporated within England and Wales to act as its process agent.

 

176

 

PART 3

 

OBLIGOR ACCESSION AGREEMENT

 

To:                              [     ] as Facility Agent and
[           ] as
Security Agent

 

From:                  [PROPOSED OBLIGOR]

 

Date:
[              ]

 

UPC Distribution Holding B.V. - €1,072,000,000 Term
Credit Agreement dated [    ] January, 2004 (the Credit
Agreement)

 

We refer to Clause 26.4 (Additional Obligors).  Terms defined in the Credit Agreement have
the same meaning in this Deed.

 

We, [name of company] of [Registered Office]
(Registered no.
[                  ])
agree:

 

(c)                                  to become an [Additional Borrower and an Additional
Guarantor/Additional Guarantor and to be bound by the terms of the Credit
Agreement as an [Additional Borrower and an Additional Guarantor/Additional
Guarantor] in accordance with Clause 26.4 (Additional Obligors);

 

(d)                                 to become a party to the Security Deed as a Charging
Entity and to observe, perform and be bound by the terms and provisions of the
Security Deed in the capacity of a Charging Entity in accordance with clause
9.6 (Charging Entities) of the Security Deed; and

 

(e)                                  to become a party to the Intercreditor Agreement as a
Charging Entity and to observe, perform and be bound by the terms and
provisions of the Intercreditor Agreement in the capacity of a Charging Entity
in accordance with clause 8.1 of the Intercreditor Agreement.

 

(f)                                    [The relevant Additional Facility will be a
[€/US$][        ] term facility with
[                 ]
as Lenders].*

 

Our address for notices for the purposes of Clause
32.2 (Addresses for notices) is:

 

	
  [

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  ]

  

 

This Deed is governed by English law.

 

 

	
  Executed as a deed by

  	
  )

  	
  Director

  
	
  [PROPOSED OBLIGOR]

  	
  )

  	
   

  
	
  acting by

  	
  )

  	
  Director/Secretary

  
	
  and

  	
  )

  	
   

  

 

*                                         In the case of an Additional Borrower

 

177

 

PART 4

 

ADDITIONAL
FACILITY ACCESSION AGREEMENT

 

 

 

	
  To:

  	
   

  	
  [                              ]
  as Facility Agent

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  [                              ]
  as Security Agent

  

 

From:                  [PROPOSED ADDITIONAL FACILITY LENDER(S)]

 

Date:
[              ]

 

 

 

UPC Distribution Holding B.V. - €1,072,000,000 Term
Credit Agreement 

dated [    ] January, 2004 (the Credit Agreement)

 

1.                                       Terms defined in the Credit Agreement shall have the
same meaning in this Deed.

 

2.                                       We refer to Clause 2.2 (Additional Facilities) of the
Credit Agreement.

 

3.                                       We, [Name of Additional Facility Lender(s)] agree:

 

(a)                                  to become party to and to be bound by the terms of the
Credit Agreement as [an] Additional Facility Lender(s) in accordance with
Clause 2.2 (Additional Facilities); and

 

(b)                             to become a party to the Security Deed as a Lender and
to observe, perform and be bound by the terms and provisions of the Security
Deed in the capacity of Lender in accordance with clause 9.3 (Transfers by
Lenders) of the Security Deed.

 

4.                                       On the date on which this agreement becomes effective,
the Additional Facility Lender represents to the Finance Parties and UPC
Distribution that it is a [Professional Market Party] / [exempted from the
requirement to be a Professional Market Party because it forms part of a closed
circle (besloten kring) with UPC
Distribution.

 

5.                                       Our Additional Facility Commitment is
EUR[                      ].  The Final Maturity Date in respect of our
Additional Facility Commitment is
[         ] and the Availability
Period is [    ].

 

6.                                       The Margin in relation to this Additional Facility is
[    ] per annum and the commitment fee in relation to this
Additional Facility under Clause 20.1 (Commitment fees) is
[    ] per cent. per annum.

 

7.                                       [The Borrower in relation to this Additional Facility
is [        ].]

 

8.                                       We confirm to each Finance Party that:

 

(i)                                     we 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 on any information provided to us by a Finance Party in
connection with any Finance Document;

 

178

 

(ii)                                  we 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; and

 

(iii)                               the purpose of the entire Additional Facility
Commitment is to finance Additional Permitted Acquisitions by members of the
Borrower Group and/or in the prepayment and cancellation of the Existing
Facility and/or Facility D by UPC Distribution.

 

9.                                       The Facility Office and address for notices of the
Additional Facility Lender for the purposes of Clause 32.2 (Addresses for
notices) is:

 

[              ]

 

10.                                 This Agreement is governed by English law.

 

[ADDITIONAL FACILITY LENDER(S)]

 

By:

 

[             ]
as Facility Agent

 

By:

 

UPC DISTRIBUTION HOLDING B.V.

 

By:

 

[RELEVANT BORROWER]

 

By:

 

179

 

PART 5

 

ADDITIONAL
FACILITY D LENDER ACCESSION AGREEMENT

 

 

 

	
  To:

  	
   

  	
  [                              ]
  as Facility Agent

  
	
   

  	
   

  	
  [                              ]
  as Security Agent

  

 

From:                  [PROPOSED ADDITIONAL D FACILITY LENDER(S)]

 

Date:
[              ]

 

 

 

UPC Distribution Holding B.V. - €1,072,000,000 Term
Credit Agreement 

dated [      ] January, 2004 (the Credit Agreement)

 

1.                                       Terms defined in the Credit Agreement shall have the
same meaning in this Deed.

 

2.                                       We refer to Clause 2.8(a) (Additional Facility D Lenders)
of the Credit Agreement.

 

3.                                       We, [Name of Additional Facility D Lender] agree on [insert date falling prior to the Allocation Date]:

 

(a)                                  to become party to and to be bound by the terms of the
Credit Agreement as an Additional Facility D Lender in accordance with Clause
2.8 (Additional Facility D Lenders); and

 

(b)                             to become a party to the Security Deed as a Lender and
to observe, perform and be bound by the terms and provisions of the Security
Deed in the capacity of Lender in accordance with clause 9.3 (Transfers by
Lenders) of the Security Deed.

 

4.                                       On the date on which this agreement becomes effective,
the Additional Facility Lender represents to the Finance Parties and UPC
Distribution that it is a [Professional Market Party] / [exempted from the requirement
to be a Professional Market Party because it forms part of a closed circle (besloten kring) with UPC Distribution.

 

5.                                       The maximum Facility D Commitments are as follows:

 

 

Facility D1                                       €[      ]

Facility D2                                       €[      ]

Facility D3                                       €[      ]

Facility D4                                       €[      ]

Facility D5                                       €[      ]

 

6.                                       We confirm that the representations in Clause 19.15(b)
and (c) (Lenders) are true and correct.

 

7.                                       [We confirm to each Finance Party that:

 

(i)                                     we 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

 

180

 

participation in
the Credit Agreement and have not relied on any information provided to us by a
Finance Party in connection with any Finance Document; and

 

(ii)                                  we 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.

 

8.                                       The Facility Office and address for notices of the
Additional Facility D Lender for the purposes of Clause 32.2 (Addresses for
notices) is:

 

[              ]

 

9.                                       This Agreement is governed by English law.

 

[ADDITIONAL FACILITY D LENDER

 

By:

 

[        ] as
Facility Agent

 

By:

 

UPC DISTRIBUTION HOLDING B.V.

 

By:

 

181

 

PART 6

 

FORM OF VERIFICATION LETTER

 

To:                              [UPC DISTRIBUTION HOLDING B.V.] / [ADDITIONAL
BORROWER]

 

From:                  [NEW LENDER] as
New Lender / [ADDITIONAL FACILITY LENDER] as Additional Facility Lender]

 

Date:                    [                            ]

 

Dear Sirs

 

UPC Distribution Holding B.V. - €1,072,000,000 Term
Credit Agreement dated [     ] January, 2004 (the Credit
Agreement)

 

We refer to the Credit Agreement.  Terms defined in the Credit Agreement have
the same meaning in this letter.

 

[On the date that we become a Lender in accordance
with [clause 26.2 (Transfers by Lenders) / clause 2.2 (Additional Facilities)
of the Credit Agreement we will be a Professional Market Party, because [name
of entity] falls within the category
[         ] set out in the
schedule to this letter.]

 

or

 

[On the date on which we become a Lender in
accordance with [clause 26.2 (Transfers by Lenders) / clause 2.2 (Additional
Facilities)] we will be exempted from the requirement to be a Professional
Market Party because we form part of a closed circle (besloten kring) with [UPC Distribution] /
[name of Additional Borrower.]#

 

[We
enclose with this letter a copy of the documents which provide evidence of this
status.]* /[We are established in
[      ] and act under the supervision of
[     ].]1

 

Yours faithfully

 

 

 

[New Lender]
/ [Additional Facility Lender]

 

 

#                                         Delete and Complete as applicable.

*                                         No evidence is required in the case of institutions
falling within category (c) of the schedule to this letter.

1             Institutions falling within
category (a) of the schedule to this letter, rather than providing documentary
evidence, can provide this confirmation.

 

182

 

THE SCHEDULE

 

THE EXEMPTION REGULATION CATEGORIES

 

 

(a)                                  Banks, insurance companies, securities firms, investment institutions
and pension funds that are (i) supervised or licensed under Dutch law or (ii)
established and acting under supervision in a European Union member state
(other than the Netherlands), Hungary, Monaco, Poland, Puerto Rico, Saudi
Arabia, Slovakia, Czech Republic, Turkey, South Korea, the United States of
America, Japan, Australia, Canada, Mexico, New Zealand or Switzerland;

 

(b)                                 investment institutions which offer their participation rights
exclusively to professional market parties and are not required to be
supervised or licensed under Dutch law;

 

(c)                                  the State of the Netherlands, the Dutch Central Bank, a foreign central
government body, a foreign central bank, Dutch regional and local governments
and comparable foreign decentralised government bodies, international treaty
organisations and supranational organisations;

 

(d)                                 enterprises or entities with total assets of at least EUR500,000,000 (or
its equivalent in another currency) as per the balance sheet as of the year end
preceding the obtaining of the repayable funds;

 

(e)                                  enterprises, entities or individuals with net assets (eigen vermogen) of at least EUR10,000,000
(or its equivalent in another currency) as of the year end preceding the
obtaining of the repayable funds who or which have been active in the financial
markets on average twice a month over a period of at least two consecutive
years preceding the obtaining of the repayable funds;

 

(f)                                    subsidiaries of the entities referred to under paragraph (a) above if
those subsidiaries are subject to supervision; and

 

(g)                                 an enterprise or institution that has a rating from a rating agency that
in the opinion of the Dutch Central Bank is an expert or that issues securities
that have a rating from a rating agency that in the opinion of the Dutch
Central Bank is an expert.

 

183

 

SCHEDULE 6

 

FORM
OF CONFIDENTIALITY UNDERTAKING

 

PART 1

 

FORM OF LMA CONFIDENTIALITY UNDERTAKING

 

LMA CONFIDENTIALITY LETTER (PURCHASER)

[Letterhead of Existing Lender]

 

To:

 

[insert name of New
Lender]

 

 

 

Re:                               The Facility

 

 

	
  Borrower:

  
	
  Amount:

  
	
  Agent:

  

 

 

Dear Sirs

 

We understand that you are considering participating
in the Facility.  In consideration of us
agreeing to make available to you certain information, by your signature of a
copy of this letter you agree as follows:

 

1.                                      Confidentiality Undertaking

 

You 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 your own confidential information;

 

(b)                                 to keep confidential and not disclose to anyone the fact that the
Confidential Information has been made available or that discussions or
negotiations are taking place or have taken place between us in connection with
the Facility;

 

(c)                                  to use the Confidential Information only for the Permitted Purpose;

 

(d)                                 to use all reasonable endeavours to ensure that any person to whom we
pass any Confidential Information (unless disclosed under sub-paragraph 2(b)
below)

 

184

 

acknowledges and
complies with the provisions of this letter as if that person were also a party
to it; and

 

(e)                                  not to make enquiries of any member of the Borrower Group or any of
their officers, directors, employees or professional advisers relating directly
or indirectly to the Facility.

 

2.                                      Permitted Disclosure

 

(a)                                  We agree that you may disclose Confidential Information:

 

(i)                                                to members of the Participant 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
Participant Group;

 

(ii)                                             (A) where requested or required by any court of
competent jurisdiction or any competent judicial, governmental, supervisory or
regulatory body, (B) where required by the rules of any stock exchange on which
the shares or other securities of any member of the Participant Group are
listed or (C) where required by the laws or regulations of any country with
jurisdiction over the affairs of any member of the Participant Group;

 

(iii)                                          with the prior written consent of us and the Borrower.

 

(b)                                 Notwithstanding any other provision of this letter, any party to this
letter (and any of its affiliates, officers, directors, employees,
representatives, professional advisers, or other agents) may and has since the
commencement of discussions with respect to the Facility been permitted to
disclose to any and all persons, without limitation of any kind:

 

(i)                                                the U.S. tax
treatment and U.S. tax structure (each
as defined below) of the Facility: and

 

(ii)                                             all material of any kind (including opinions and other
tax analyses) that are provided to such party relating to such U.S. tax
treatment or U.S. tax structure,

 

except to the
extent reasonably necessary to comply with applicable federal or state
securities laws.

 

For the purposes
of this subsection, the U.S. tax treatment of the Facility is the purported or
claimed U.S. federal, state and local income tax treatment of the Facility, and
the U.S. tax structure of the Facility is any fact that may be relevant to
understanding the purported or claimed U.S. federal, state and local income tax
treatment of the Facility.  This
authorisation is not intended to permit disclosure of any information  (other than information relating to U.S. tax
treatment or U.S. tax structure of the Facility) including (without limitation
(i) any portion of any materials to the extent not related to the U.S. tax
treatment or U.S. tax structure of the Facility, (ii) the identities of
participants or potential participants in the Facility (except to the extent
such identities are related to the tax treatment or the U.S. tax structure of
the Facility), (iii) the existence or status of any negotiations, (iv) any
pricing or financial information (except to the extent such pricing or
financial information is related to the U.S. tax treatment or the U.S. tax
structure of the Facility), or (v) any other term or detail not relevant to the
U.S. tax treatment or the U.S. tax structure of the Facility.

 

185

 

3.                                      Notification of Required or
Unauthorised Disclosure

 

You agree (to
the extent permitted by law) to inform us of the full circumstances of any
disclosure under sub-paragraph 2(b) or upon becoming aware that Confidential
Information has been disclosed in breach of this letter.

 

4.                                      Return of Copies

 

If we so request
in writing, you shall return all Confidential Information supplied to you by us
and destroy or permanently erase all copies of Confidential Information made by
you and use all reasonable endeavours to ensure that anyone to whom you 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 you 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
sub-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 you become a party to or
otherwise acquire (by assignment or sub-participation) an interest, direct or
indirect, in the Facility or (b) 12 months after we have returned all
Confidential Information supplied to you by us and destroyed or permanently
erased all copies of Confidential Information made by you (other than any such
Confidential Information or copies which have been disclosed under paragraph 2
above (other than sub-paragraph 2(a)) or which, pursuant to paragraph 4 above,
are not required to be returned or destroyed).

 

6.                                      No Representation; Consequences of
Breach, etc

 

You acknowledge
and agree that:

 

(a)                                  neither we nor any of our officers, employees or advisers (each a Relevant Person) (i) make any
representation or warranty, express or implied, as to, or assume any
responsibility for, the accuracy, reliability or completeness of any of the Confidential
Information or any other information supplied by us or any member of the
Borrower Group or the assumptions on which it is based or (ii) shall be under
any obligation to update or correct any inaccuracy in the Confidential
Information or any other information supplied by us or any member of the
Borrower Group or be otherwise liable to you or any other person in respect to
the Confidential Information or any such information; and

 

(b)                                 we or members of the Borrower Group may be irreparably harmed by the
breach of the terms of this letter and damages may not be an adequate remedy;
each Relevant Person or member of the Borrower Group may be granted an
injunction or specific performance for any threatened or actual breach of the
provisions of this letter by you.

 

7.                                      No Waiver; Amendments, etc.

 

This letter sets
out the full extent of our obligations of confidentiality owed to us in
relation to the information the subject of this letter.  No failure or delay in exercising any right,
power or

 

186

 

privilege under
this letter 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 under this letter.  The terms of this letter and your
obligations under this letter 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 you undertake not to
use any Confidential Information for any unlawful purpose.

 

9.                                      Nature of Undertakings

 

The undertakings
given by you under this letter are given to us and (without implying any
fiduciary obligations on our part) are also given for the benefit of the
Borrower and each other member of the Borrower Group.

 

10.                               Third party rights

 

(a)                                  Subject to paragraph 6 and paragraph 9 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 to this
letter do not require the consent of any Relevant Person or any member of the
Borrower Group to rescind or vary this letter at any time.

 

11.                               Governing Law and Jurisdiction

 

This letter
(including the agreement constituted by your acknowledgement of its terms)
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.

 

12.                               Definitions

 

In this letter
(including the acknowledgement set out below):

 

Borrower
Group means UPC Distribution
and each of its holding companies and subsidiaries and each subsidiary of each
of its holding companies (as each such term is defined in the Companies Act
1985);

 

Confidential
Information means any information
relating to a Borrower, the Borrower Group, the Facility including 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 you before the date the information is disclosed to you by us or
any of our affiliates or advisers or is lawfully obtained by you thereafter,
other than from a source which is connected with the Borrower Group and which,
in either case, as far as you are aware, has not been obtained in violation of,
and is not otherwise subject to, any obligation of confidentiality;

 

187

 

Participant
Group means us, each of your
holding companies and subsidiaries and each subsidiary of each of your holding
companies (as each such term is defined in the Companies Act 1985); and

 

Permitted
Purpose means considering and
evaluating whether to enter into the Facility.

 

Please acknowledge your agreement to the above by
signing and returning the enclosed copy.

 

Yours faithfully

 

 

	
   

  	
   

  
	
   

  
	
  For and on behalf of

  
	
   

  
	
  [Arranger]

  

 

 

	
  To:

  	
  [Existing Lender]

  
	
   

  	
   

  
	
   

  	
  The Borrower and each other member of the
  Borrower Group

  

 

We acknowledge and agree to the above:

 

	
   

  	
   

  
	
   

  
	
  For and on behalf of

  
	
   

  
	
  [New Lender]

  

 

188

 

PART 2

 

FORM OF LSTA CONFIDENTIALITY UNDERTAKING

 

 

Master Confidentiality Agreement dated as of
[       ] (this Agreement) between [Existing Lender] (the Existing Lender) and [New Lender] (the New Lender).

 

This Agreement sets forth the terms and conditions
that will apply, in each instance, to the treatment of certain non-public
information that the Existing Lender may supply to the New Lender in connection
with the consideration by the New Lender of its participating in any financing
or proposed financing (a Financing)
for any borrower or group of borrowers (each a Borrower) specified in a Schedule described below.

 

As used herein: 
(a) Evaluation Material
refers to (i) the non-public information furnished to the Existing Lender,
including any Information Memorandum, in respect of a particular Financing of a
Borrower that the Existing Lender supplies to the New Lender on or after the
date of the Schedule in respect of such Financing, (ii) all memoranda,
notes, and other documents and analyses (collectively, analyses)
internally developed by the Existing Lender that it supplies to the
New Lender and (iii) all analyses developed by the New Lender using any
information specified under clauses (i) and (ii) above; (b) Internal Evaluation Material refers to
analyses specified under clause (iii) of the definition of Evaluation Material;
and (c) participation refers to a
transfer of a lender’s interest in a Financing (or a grant of derivative rights
in respect thereof), whether by assignment, participation or otherwise (and participate and participating shall have correlative meanings thereto).

 

As a condition to the Existing Lender’s furnishing the
New Lender with any Evaluation Material in the Existing Lender’s possession in
respect of a particular Financing, the New Lender shall execute and return to
the Existing Lender a schedule, in substantially the form of Exhibit A attached
hereto, that the Existing Lender may have completed, executed and delivered to
it (a Schedule).  Each Schedule shall identify the
Existing Lender and the New Lender in respect of such Financing and the related
Evaluation Material, the name of each Borrower that the New Lender has under
consideration and a description of the documentation (the Operative Documentation) in respect
thereof.

 

The New Lender in respect of a particular Financing
agrees that it will use all Evaluation Material in respect of such Financing
solely for the purpose of evaluating its possible participation, or obtaining
the participation of another eligible person (an Additional Assignee), in such Financing and that the New
Lender will use reasonable precautions in accordance with its established
procedures to keep such information confidential; provided, however, that any
such information may be disclosed to the partners, directors, officers,
employees, agents, counsel, auditors, affiliates, advisors and representatives
(collectively, Representatives) of
the New Lender’s institution who need to know such information for the purpose
of evaluating its participation in such Financing (it being understood that
such Representatives shall be informed by the New Lender of the confidential
nature of such information and shall be directed by it to treat such
information in accordance with the terms of this Agreement) and to any
Additional Assignee and its Representatives (provided that such Additional
Assignee shall have previously executed and delivered to the New Lender an
agreement in substantially the same substance as this Agreement in respect of
the Evaluation Material). The New Lender agrees to be responsible for any
breach of this Agreement that results from the actions or omissions of its
Representatives.  Notwithstanding the
foregoing, the New Lender will not use such information to obtain an Additional
Assignee if otherwise prohibited by agreements binding on the New Lender.

 

189

 

In addition, the New Lender in respect of a particular
Financing agrees that prior to the settlement of its participation in such
Financing, it will not disclose to any person, other than its Representatives, the
identity of the Existing Lender with which discussions or negotiations are
taking place concerning the New Lender’s possible participation in the related
Financing or any of the terms or conditions of such proposed participation.  The term person
as used in this Agreement shall be broadly interpreted to include the media and
any corporation, partnership, group, individual or other entity and, if the New
Lender’s participation in the Financing would constitute a secondary market
transaction, the Borrower.

 

The New Lender in respect of a particular Financing
shall be permitted to disclose any related Evaluation Material (and the fact
that such Evaluation Material has been made available to it and that
discussions or negotiations are taking place concerning the transaction or any
of the terms, conditions or other facts with respect thereto) in the event that
the New Lender is required by law or regulation or requested by any
governmental agency or other regulatory authority (including any
self-regulatory organization having or claiming to have jurisdiction) or in
connection with any legal proceedings. The New Lender agrees that it will
notify the Existing Lender as soon as practical in the event of any such
disclosure (other than as a result of an examination by any regulatory agency),
unless such notification shall be prohibited by applicable law or legal
process.

 

The New Lender in respect of a particular Financing
and its Representatives shall have no obligation hereunder with respect to any
information in any related Evaluation Material to the extent that such
information (i) is or becomes generally available to the public other than as a
result of a disclosure by the New Lender in violation of this Agreement, (ii)
was within the New Lender’s possession prior to its being furnished to it
pursuant hereto, provided that the source of such information was not known by
the New Lender to be bound by a confidentiality agreement with or other
contractual, legal or fiduciary obligation of confidentiality to the Borrower
or any other party with respect to such information or (iii) is or becomes
available to the New Lender on a non-confidential basis from a source other
than the Borrower or the Existing Lender, or their respective Representatives,
provided that such source is not known by the New Lender to be bound by a
confidentiality agreement with or other contractual, legal or fiduciary
obligation of confidentiality to the Existing Lender, the Borrower or any other
party with respect to such information.

 

Notwithstanding any other provision of this letter,
any party to this letter (and any of its affiliates, officers, directors,
employees, representatives, professional advisers, or other agents) may and has
since the commencement of discussions with respect to the Facility been
permitted to disclose to any and all persons, without limitation of any kind:

 

(i)                                     the U.S. tax treatment and U.S. tax structure (each as defined below)
of the Facility; and

 

(ii)                                  all material of any kind (including opinions and other tax analyses)
that are provided to such party relating to such U.S. tax treatment or U.S. tax
structure,

 

except to the extent reasonably necessary to comply
with applicable federal or state securities laws.

 

For the purposes of this subsection, the U.S. tax treatment of the Facility is the
purported or claimed U.S. federal, state and local income tax treatment of the
Facility, and the U.S. tax structure
of the Facility is any fact that may be relevant to understanding the purported
or claimed U.S. federal, state and local income tax treatment of the
Facility.  This authorisation is not
intended to permit disclosure of any information (other than information
relating to U.S. tax treatment or U.S. tax structure of the Facility) including
(without limitation) (i) any portion of any materials to the extent not related
to the U.S. tax treatment or U.S. tax structure of the Facility, (ii) the
identities of participants or potential participants in the Facility (except to
the extent such identities are related to the tax treatment or the U.S. tax
structure of the Facility), (iii) the existence or status of any negotiations,
(iv) any pricing or financial information (except to the extent such pricing or
financial information is related to the U.S.

 

190

 

tax treatment or the U.S. tax structure of the
Facility), or (v) any other term or detail not relevant to the U.S. tax
treatment or the U.S. tax structure of the Facility.

 

To the extent the Operative Documentation for a
particular Financing contains provisions regarding the use of non-public
information which conflict with, are more restrictive than or are in addition
to the provisions of this Agreement, then (so long as such Operative
Documentation shall be effective as to the Existing Lender) solely with
application to any Evaluation Material concerning the Borrower that is the
subject of such Financing (and without application hereunder to any other
Evaluation Material or otherwise), such provisions of the Operative Documentation
shall be incorporated herein by this reference and shall supersede and control
the terms of this Agreement to the extent that such provisions are in conflict
with or more restrictive than the terms hereof or are in addition to those
contained herein.  Upon the New Lender’s
request, the Existing Lender will furnish to the New Lender the provisions of
the Operative Documentation for such Financing regarding the use of non-public
information.  In addition, in the event
that the New Lender actually becomes a lender (bound as a party to the
Operative Documentation) with respect to a particular Financing, the
application of this Agreement in respect of all Evaluation Material in respect
of such Financing shall terminate and the applicable confidentiality provisions,
if any, contained in the Operative Documentation shall govern and control.

 

If the New Lender in respect of a particular Financing
chooses not to participate in such Financing, the New Lender agrees on request
of the Existing Lender to return to the Existing Lender as soon as practical
all related Evaluation Material (other than Internal Evaluation Material) or
destroy such Evaluation Material (other than Internal Evaluation Material)
without retaining any copies thereof unless prohibited from doing so by its
internal policies and procedures.

 

The New Lender in respect of a particular Financing
understands and agrees that the Existing Lender will have received the related
Evaluation Material from third party sources (including the Borrower) and that
the Existing Lender bears no responsibility (and shall not be liable) for the
accuracy or completeness (or lack thereof) of such Evaluation Material or any
information contained therein.

 

The New Lender hereby acknowledges that United States
securities laws prohibit any person with material, non-public information about
an issuer from purchasing or selling securities of such issuer or, subject to
certain limited exceptions, from communicating such information to any other
person.  The New Lender agrees to comply
with its internal compliance policies and procedures with respect to material
confidential information.

 

The New Lender agrees that money damages would not be
a sufficient remedy for breach of this Agreement, and that in addition to all
other remedies available at law or in equity, the Existing Lender shall be
entitled to seek equitable relief, including injunction and specific
performance, without proof of actual damages.

 

This Agreement (including each Schedule delivered
pursuant hereto and the provisions of any Operative Documentation incorporated
herein by reference) embodies the entire understanding and agreement between
the parties with respect to all Evaluation Material for each Financing and
supersedes all prior understandings and agreements relating thereto.  Unless otherwise agreed in writing between
the parties hereto, the application of this Agreement shall terminate with
respect to all Evaluation Material concerning each Financing on the date
falling one year after the Schedule in respect of such Financing.

 

This Agreement shall be governed by and construed in
accordance with the law of the State of New York, without regard to principles
of conflicts of law (except Section 5-1401 of the New York General
Obligation Law to the extent that it mandates that the law of the State of New
York govern).

 

191

 

This Agreement may be signed in counterparts, each of
which shall be an original and both of which taken together shall constitute
the same instrument.

 

It is understood by the parties that the custom in the
loan syndications and loan trading markets is to execute and deliver any
confidentiality agreement, schedule, confirmation or other transaction
documents by telecopy or telefax.  The
parties agree that all telecopied or telefaxed copies of this Agreement, the
Schedules, confirmations and other transaction documents, and signatures hereto
and thereto, shall be duplicate originals.

 

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

 

[Existing Lender]

 

	
  By:

  	
   

  	
   

  
	
   

  
	
  Name:

  
	
  Title:

  
	
   

  
	
  [New Lender]

  
	
   

  
	
  By:

  	
   

  	
   

  
	
   

  
	
  Name:

  
	
   

  
	
  Title:

  
				

 

192

 

EXHIBIT A

 

This Schedule, dated as of
[         ], is one of the
Schedules referred to in the Master Confidentiality Agreement dated today
between [Existing Lender] and [New Lender], 
Terms used herein, unless defined herein, shall have the respective
meanings given them in said Master Confidentiality Agreement.

 

Name(s) of the Borrower(s):
[                                    ]

 

Description of the Operative Documentation:
[                                    ]

 

Existing Lender

 

 [                                    ].

 

By:
[                                    ]

 

Name:

Title:

 

Received and accepted as of

the date first written above:

 

New Lender

 

[                                    ].

 

By:
[                                    ]

 

Name:

 

Title:

 

193

 

SCHEDULE 7

 

SECURITY DOCUMENTS

 

1.                                       Each share pledge given in favour of the Security
Agent by:

 

(a)                                  UPC Holding in respect of its interest in the share capital of UPC
Distribution;

 

(b)                                 UPC Holding in respect of its interest in the share capital of UPC
Holding II;

 

(c)                                  UPC Distribution in respect of its interest in the share capital of UPC
Scandinavia Holding B.V.;

 

(d)                                 UPC Distribution in respect of its interest in the share capital of
Cable Networks Austria Holding B.V.;

 

(e)                                  UPC Distribution in respect of its interest in the share capital of UPC
France Holding B.V.;

 

(f)                                    UPC Distribution in respect of its interest in the share capital of UPC
Nederland B.V.;

 

(g)                                 UPC Distribution in respect of its interest in the share capital of
Stipdon Investments B.V.;

 

(h)                                 UPC Scandinavia Holding B.V. in respect of its interest in the share
capital of United Pan-Europe Communications Norge AS;

 

(i)                                     UPC Scandinavia Holding B.V. and Cable Networks Austria Holding B.V. in
respect of their respective interests in the share capital of UPC Belgium SA;

 

(j)                                     UPC Scandinavia Holding B.V. in respect of its interest in the share
capital of NBS Nordic Broadband Services AB;

 

(k)                                  Stipdon Investments B.V. in respect of its interest in the share capital
of UPC Czech Holding B.V.;

 

(l)                                     Stipdon Investments B.V. in respect of its interest in the share capital
of UPC Slovakia Holding B.V.;

 

(m)                               Stipdon Investments B.V. in respect of its interest in the share capital
of UPC Romania Holding B.V.; and

 

(n)                                 Stipdon Investments B.V. in respect of its interests in the share
capital of Telekabel Hungary N.V..

 

2.                                       Pledge by each of UPC Holding and UPC Holding II of
its partnership interest in UPC Financing.

 

3.                                       (a)                                  Obligor Pledge of Shareholder Loans between UPC Distribution,
UPC Scandinavia Holding B.V., Stipdon Investments B.V., UPC Nederland B.V. and
UPC Financing Partnership and the Security Agent;

 

194

 

(b)                                 Pledge of Subordinated Shareholder Loans between UPC Holding and the
Security Agent;

 

(c)                                  Obligor Pledge of Shareholder Loans between UPC Distribution and the
Security Agent;

 

(d)                                 Obligor Pledge of Shareholder Loans between UPC Distribution and the
Security Agent;

 

(e)                                  Obligor Pledge of Shareholder Loans between Stipdon Investments B.V. and
the Security Agent;

 

(f)                                    Obligor Pledge of Shareholder Loans between Scandinavia Holding B.V. and
the Security Agent; and

 

(g)                                 Obligor Pledge of Shareholder Loans between UPC Distribution and the
Security Agent.

 

4.                                       Deed of pledge of registered shares in favour of the
Security Agent by UPC Distribution over its interest in UPC Distribution
Services B.V.

 

5.                                       Bank account pledge between UPC Distribution, Fortis
Bank (Nederland B.V.) and the Security Agent.

 

6.                                       Securities account pledge between UPC Scandinavia
Holding B.V., Fortis Bank (Nederland) N.V. and the Security Agent in relation
to the shares in the capital of NBS Nordic Broadband AB.

 

195

 

SCHEDULE 8

 

BORROWER GROUP STRUCTURE

 

 

*                                         All the
asterisked entities are not part of the Borrower Group at the Signing
Date.  These entities figure on the
chart for the sake of clarification.

(1)                                  One share in
UPC Belgium S.A. is held by Cable Network Austria Holding B.V.

 

196

 

SCHEDULE 9

 

SHAREHOLDERS’ AGREEMENTS

 

1.                                      Austria

 

Syndikatsvereinbarung
(shareholders agreement) dated 28th June, 1995 among Osterreichische Philips
Industrie GmbH, Cable Networks Austria Holding B.V. and Kabel-TV-Wien GmbH. (In
English and German).

 

2.                                      France

 

Stockholders
Agreement dated 29th February, 2000 between Belmarken Holding B.V., InterComm
France CVOHA, InterComm France II CVOHA and Reflex Participants.

 

3.                                      The Netherlands

 

Shareholders’
Agreement, dated 6th July, 1995, among The Municipality of Amsterdam, A2000
Holding N.V. and Kabeltelevisie Amsterdam B.V. (in English).

 

4.                                      Romania

 

Partnership
Agreement between Comtec 2000, Multicanal Holdings S.R.L. and Control SA.

 

197

 

SIGNATORIES

 

Borrower

 

UPC DISTRIBUTION
HOLDING B.V.

 

By:                              /s/ JEREMY EVANS

                                                JEREMY EVANS

 

/s/ DENNIS OKHUIJSEN

DENNIS OKHUIJSEN

 

 

Original
Guarantors

 

UPC DISTRIBUTION
HOLDING B.V.

 

By:                              /s/ JEREMY EVANS

                                                JEREMY EVANS

 

/s/ DENNIS OKHUIJSEN

DENNIS OKHUIJSEN

 

 

UPC HOLDING II
B.V.

 

By:                              /s/ JEREMY EVANS

                                                JEREMY EVANS

 

/s/ DENNIS OKHUIJSEN

DENNIS OKHUIJSEN

 

 

UPC FINANCING
PARTNERSHIP

 

By:                              /s/ JEREMY EVANS

                                                JEREMY EVANS

 

/s/ DENNIS OKHUIJSEN

DENNIS OKHUIJSEN

 

 

UPC HOLDING B.V.

 

By:                              /s/ JEREMY EVANS

                                                JEREMY EVANS

 

/s/ DENNIS OKHUIJSEN

DENNIS OKHUIJSEN

 

 

UPC FRANCE
HOLDING B.V.

 

By:                              /s/ JEREMY EVANS

                                                JEREMY EVANS

 

/s/ DENNIS OKHUIJSEN

DENNIS OKHUIJSEN

 

198

 

UPC SCANDINAVIA HOLDING B.V.

 

By:                              /s/ JEREMY EVANS

                                                JEREMY EVANS

 

/s/ DENNIS
OKHUIJSEN

DENNIS OKHUIJSEN

 

 

CABLE NETWORK AUSTRIA HOLDING B.V.

 

By:                              /s/ JEREMY EVANS

                                                JEREMY EVANS

 

/s/ DENNIS
OKHUIJSEN

DENNIS OKHUIJSEN

 

 

STIPDON INVESTMENTS B.V.

 

By:                              /s/ JEREMY EVANS

                                                JEREMY EVANS

 

/s/ DENNIS
OKHUIJSEN

DENNIS OKHUIJSEN

 

 

UPC NEDERLAND B.V.

 

By:                              /s/ JEREMY EVANS

                                                JEREMY EVANS

 

/s/ DENNIS
OKHUIJSEN

DENNIS OKHUIJSEN

 

 

Lenders

 

ARES LEVERAGED INVESTMENT FUND II LP

 

By:                              /s/ RORY MCCARTHY

                                                RORY MCCARTHY

 

(as attorney)

 

 

B&W MASTER TOBACCO RETIREMENT

 

By:                              /s/ RORY MCCARTHY

                                                RORY MCCARTHY

 

(as attorney)

 

 

BANK OF AMERICA N.A.

 

By:                              /s/ ERIC CLAUSE

                                                ERIC CLAUSE

 

199

 

BEAR STEARNS CORPORATE LENDING INC.

 

By:                              /s/ RORY MCCARTHY

                                                RORY MCCARTHY

 

(as attorney)

 

 

BNP PARIBAS, BELGIAN BRANCH

 

By:                              /s/ RORY MCCARTHY

                                                RORY MCCARTHY

 

(as attorney)

 

 

CANADIAN IMPERIAL BANK OF COMMERCE, LONDON BRANCH

 

By:                              /s/ JOHN MALET DE
CARTERET

                                                JOHN MALET DE CARTERET

 

 

CITIBANK N.A.

 

By:                              /s/ PAUL HOUSE

                                                PAUL HOUSE

 

 

CREDIT LYONNAIS SA

 

By:                              /s/ RORY MCCARTHY

                                                RORY MCCARTHY

 

(as attorney)

 

 

CREDIT SUISSE FIRST BOSTON

 

By:                              /s/ RORY MCCARTHY

                                                RORY MCCARTHY

 

(as attorney)

 

 

DEUTSCHE BANK AG

 

By:                              /s/ RORY MCCARTHY

                                                RORY MCCARTHY

 

(as attorney)

 

200

 

DEUTSCHE BANK STRUCTURED PRODUCTS INC.

 

By:                              /s/ RORY MCCARTHY

                                                RORY MCCARTHY

 

                                                (as attorney)

 

 

FORTIS BANK (NEDERLAND) N.V.

 

By:                              /s/ RORY MCCARTHY

                                                RORY MCCARTHY

 

                                                (as attorney)

 

 

GE CAPITAL CORPORATION

 

By:                              /s/ RORY MCCARTHY

                                                RORY MCCARTHY

 

                                                (as attorney)

 

 

GOLDEN TREE HY MASTER

 

By:                              /s/ RORY MCCARTHY

                                                RORY MCCARTHY

 

                                                (as attorney)

 

 

GOLDEN TREE HY MASTER FUND II

 

By:                              /s/ RORY MCCARTHY

                                                RORY MCCARTHY

 

                                                (as attorney)

 

 

GOLDEN TREE HY OPPORTUNITIES I

 

By:                              /s/ RORY MCCARTHY

                                                RORY MCCARTHY

 

                                                (as attorney)

 

 

GOLDEN TREE HY OPPORTUNITIES II

 

By:                              /s/ RORY MCCARTHY

                                                RORY MCCARTHY

 

                                                (as attorney)

 

201

 

GOLDEN TREE HY VALUE MASTER FUND

 

By:                              /s/ RORY MCCARTHY

                                                RORY MCCARTHY

 

                                                (as attorney)

 

 

GOLDMAN SACHS CREDIT PARTNERS, L.P.

 

By:                              /s/ JULIAN SALISBURY

                                                JULIAN SALISBURY

 

ING BANK N.V.

 

By:                              /s/ RORY MCCARTHY

                                                RORY MCCARTHY

 

                                                (as attorney)

 

 

JPMORGAN CHASE BANK

 

By:                              /s/ PETER JAFFE

                                                PETER JAFFE

 

 

MOORE US RESTRUCTURING, L.P.

 

By:                              /s/ RORY MCCARTHY

                                                RORY MCCARTHY

 

                                                (as attorney)

 

 

MORGAN STANLEY EMERGING MARKETS

 

By:                              /s/ RORY MCCARTHY

                                                RORY MCCARTHY

 

                                                (as attorney)

 

 

MORGAN STANLEY SENIOR FUNDING INC

 

By:                              /s/ RORY MCCARTHY

                                                RORY MCCARTHY

 

                                                (as attorney)

 

202

 

MUNICIPAL FIRE AND POLICE RETIREMENT FUND

 

By:                              /s/ RORY MCCARTHY

                                                RORY MCCARTHY

 

                                                (as attorney)

 

 

ORN EUROPEAN DEBT FUND L.P.

 

By:                              /s/ RICHARD BARNES

                                                RICHARD BARNES

 

 

PERRY PRINCIPALS LLC

 

By:                              /s/ RORY MCCARTHY

                                                RORY MCCARTHY

 

                                                (as attorney)

 

 

QDRF MASTER LIMITED

 

By:                              /s/ RORY MCCARTHY

                                                RORY MCCARTHY

 

                                                (as attorney)

 

 

QUANTUM PARTNERS LDC

 

By:                              /s/ RORY MCCARTHY

                                                RORY MCCARTHY

 

                                                (as attorney)

 

 

SATELLITE SENIOR INCOME FUND LLC

 

By:                              /s/ RORY MCCARTHY

                                                RORY MCCARTHY

 

                                                (as attorney)

 

 

SCOTIA BANK EUROPE PLC

 

By:                              /s/ RORY MCCARTHY

                                                RORY MCCARTHY

 

                                                (as attorney)

 

203

 

STRATEGIC VALUE MASTER FUND LTD

 

By:                              /s/ RORY MCCARTHY

                                                RORY MCCARTHY

 

                                                (as attorney)

 

 

TORONTO DOMINION (TEXAS), INC.

 

BY:                             /s/ RORY MCCARTHY

                                                RORY MCCARTHY

 

                                                (as attorney)

 

 

THE ROYAL BANK OF SCOTLAND PLC

 

By:                              /s/ RICHARD DORMAN

                                                RICHARD DORMAN

 

 

THE TORONTO-DOMINION BANK

 

By:                              /s/ RORY MCCARTHY

                                                RORY MCCARTHY

 

 

TRS IO LLC

 

By:                              /s/ RORY MCCARTHY

                                                RORY MCCARTHY

 

                                                (as attorney)

 

 

UNIVERSITY OF CHICAGO

 

By:                              /s/ RORY MCCARTHY

                                                RORY MCCARTHY

 

                                                (as attorney)

 

 

Facility Agent

 

TD BANK EUROPE LIMITED

 

By:                              /s/ RORY MCCARTHY

                                                RORY MCCARTHY

 

204

 

Security Agent

 

TD BANK EUROPE LIMITED

 

By:                              /s/ RORY MCCARTHY

                                                RORY MCCARTHY

 

 

Existing Facility Agents

 

TD BANK EUROPE LIMITED

 

By:                              /s/ RORY MCCARTHY

                                                RORY MCCARTHY

 

 

TORONTO DOMINION (TEXAS), INC.

 

By:                              /s/ RORY MCCARTHY

                                                RORY MCCARTHY

 

                                                (as attorney)

 

205

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