Document:

Exhibit 4.1

 

CONFORMED
COPY

 

£30,000,000

 

FACILITY AGREEMENT

 

 

dated 2 February 2005

 

 

for

 

 

SPIRENT PLC

 

 

arranged by

COMMERZBANK AG

HSBC BANK PLC

LLOYDS TSB BANK PLC

THE ROYAL BANK OF SCOTLAND PLC

 

 

with

 

 

LLOYDS TSB BANK PLC

acting as Agent

 

 

 

 

 

 

CONTENTS

 

	
  CLAUSE

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  1.

  	
  Interpretation

  	
   

  
	
  2.

  	
  The Facility

  	
   

  
	
  3.

  	
  Purpose

  	
   

  
	
  4.

  	
  Conditions
  Precedent

  	
   

  
	
  5.

  	
  Loans

  	
   

  
	
  6.

  	
  Repayment

  	
   

  
	
  7.

  	
  Prepayment and Cancellation

  	
   

  
	
  8.

  	
  Interest
  Periods

  	
   

  
	
  9.

  	
  Interest

  	
   

  
	
  10.

  	
  Optional Currencies

  	
   

  
	
  11.

  	
  Amount of Optional
  Currencies

  	
   

  
	
  12.

  	
  Payments

  	
   

  
	
  13.

  	
  Taxes

  	
   

  
	
  14.

  	
  Market Disruption

  	
   

  
	
  15.

  	
  Increased Costs

  	
   

  
	
  16.

  	
  Illegality

  	
   

  
	
  17.

  	
  Guarantee

  	
   

  
	
  18.

  	
  Representations and
  Warranties

  	
   

  
	
  19.

  	
  Undertakings

  	
   

  
	
  20.

  	
  Default

  	
   

  
	
  21.

  	
  The Agent and the
  Arrangers

  	
   

  
	
  22.

  	
  Fees

  	
   

  
	
  23.

  	
  Expenses

  	
   

  
	
  24.

  	
  Stamp Duties

  	
   

  
	
  25.

  	
  Indemnities

  	
   

  
	
  26.

  	
  Evidence and
  Calculations

  	
   

  
	
  27.

  	
  Amendments and
  Waivers

  	
   

  
	
  28.

  	
  Changes to the
  Parties

  	
   

  
	
  29.

  	
  Disclosure of
  Information

  	
   

  
	
  30.

  	
  Set-Off

  	
   

  
	
  31.

  	
  Pro Rata Sharing

  	
   

  
	
  32.

  	
  Severability

  	
   

  
	
  33.

  	
  Counterparts

  	
   

  
	
  34.

  	
  Notices

  	
   

  
	
  35.

  	
  Language

  	
   

  
	
  36.

  	
  Jurisdiction

  	
   

  
	
  37.

  	
  Governing Law

  	
   

  
	
  38.

  	
  Waiver of Jury
  Trial

  	
   

  

 

i

 

THE SCHEDULES

 

	
  SCHEDULE

  	
   

  
	
   

  	
   

  
	
  SCHEDULE 1 Original Parties

  	
   

  
	
  SCHEDULE 2 Conditions Precedent
  Documents

  	
   

  
	
  SCHEDULE 3 Calculation of the
  Mandatory Cost

  	
   

  
	
  SCHEDULE 4 Form of Notices

  	
   

  
	
  SCHEDULE 5 Forms of Accession
  Documents

  	
   

  
	
  SCHEDULE 6 Form of Compliance
  Certificate

  	
   

  
	
  SCHEDULE 7 Form of Margin
  Certificate

  	
   

  
	
  SCHEDULE 8 Existing Preferred
  Indebtedness

  	
   

  
	
  SCHEDULE 9 Subsidiaries

  	
   

  

 

ii

 

THIS AGREEMENT is
made on 2 February 2005 between:

 

(1)         SPIRENT plc (Registered
No. 470893) (the “Company”);

 

(2)         COMMERZBANK AG, HSBC BANK PLC, LLOYDS
TSB BANK PLC and THE ROYAL BANK OF SCOTLAND PLC (in this capacity the “Arrangers”);

 

(3)         THE FINANCIAL INSTITUTIONS listed in
Schedule 1 (Original Parties) as banks
(the ”Banks”); and

 

(4)         LLOYDS TSB BANK plc as agent (in this
capacity the “Agent”).

 

IT IS AGREED as
follows:

 

1.           INTERPRETATION

 

1.1         Definitions

 

In this Agreement:

 

“Accounting Period” means:

 

(a)            in respect of the Group, any period
of 12 months ending on the last day of a financial year, financial half-year
and, prior to the Normalisation Date, a financial quarter of the Group; or

 

(b)           for the purposes of Clause 19.17 (Material Subsidiaries), in respect of the Company or any
Material Subsidiary, any period of 12 months ending on the last day of a
financial year or financial half-year of the Company or that Material
Subsidiary (as applicable).

 

“Accounts” means, at any time:

 

(a)            in respect of any Accounting Period
of the Group, the consolidated balance sheet and profit and loss account of the
Group provided to the Agent under Clause 19.2(a) (Financial
information) in respect of that Accounting Period; or

 

(b)           for the purposes of Clause 19.17 (Material Subsidiaries), in respect of any Accounting Period
of the Company or any Material Subsidiary the balance sheet and profit and loss
account of the Company or that Material Subsidiary (as applicable) in respect
of that Accounting Period.

 

“Additional Borrower” means a member of the Group which
becomes a Borrower in accordance with Clause 28.5 (Additional
Borrowers).

 

“Additional Guarantor” means a member of the Group which
becomes a Guarantor in accordance with Clause 28.6 (Additional
Guarantors).

 

“Affiliate” means a Subsidiary or a Holding Company of a
person or any other Subsidiary of that Holding Company.

 

“Agent’s Spot Rate of Exchange” means the Agent’s spot rate
of exchange for the purchase of the relevant Optional Currency in the London
foreign exchange market with Sterling at or about 11:00 a.m. on a
particular day.

 

“Anti-Terrorism Law” means each of:

 

 

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

 

(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 relating to terrorism
or money laundering enacted in the United States of America subsequent to the
date of this Agreement.

 

“Auditor” means Ernst & Young LLP or any other
auditor appointed by the Company.

 

“Availability Period” means, subject to Clause 2.4 (Extension of Final Maturity Date), the period from and
including the Commencement Date to and including 1 February 2006 (being
the date which is 364 days from the Commencement Date).

 

“Balance Sheet” means, at any time, the latest published
consolidated balance sheet of the Group.

 

“Borrower” means, subject to Clause 28.7 (Removal of Obligors), the Company or an Additional Borrower.

 

“Borrower Accession Agreement” means a letter substantially
in the form of Part II of Schedule 5 with such amendments as the
Agent and the Company may agree.

 

“Business Day” means a day (other than a Saturday or Sunday)
on which banks are open for general business in London and:

 

(a)            in relation to a payment in an
Optional Currency other than euros, the principal financial centre of the
country of that Optional Currency; or

 

(b)           in relation to a payment in euros, a
TARGET Business Day.

 

“Cash and Cash Equivalents” means, at any time:

 

(a)            cash on deposit in any Permitted
Bank;

 

(b)           any investment in:

 

(i)           marketable obligations issued or
guaranteed by the U.S. or the U.K. or by an instrumentality or agency of the
U.S. or the U.K. having an equivalent credit rating;

 

(ii)          certificates of deposit, maturing
within one year after acquisition thereof, issued by a Permitted Bank;

 

(iii)         bankers’ acceptances and eligible
bills accepted by Permitted Banks, maturing within one year after acquisition
thereof; and

 

(iv)         open market commercial paper or other
unsubordinated indebtedness:

 

(A)         for which a recognised trading market
exists on any Business Day;

 

(B)          issued in the U.S., the U.K. or the
Eurodollar market;

 

2

 

(C)          which matures within one year after
acquisition thereof; and

 

(D)         which has a credit rating of either A-1
by Standard & Poor’s or IBCA or P-1 by Moody’s or any future
equivalent of any such credit rating, or, if no rating is available with
respect to such commercial paper or indebtedness, the issuer of which has, in
respect of its long-term debt obligations, an equivalent rating; or

 

(c)            any other instrument, security or
investment approved by the Majority Banks, in each case, to which any member of
the Group is beneficially entitled at that time.

 

“Code” means the United States Internal Revenue Code of 1986
as amended from time to time.

 

“Commencement Date” means 2
February 2005.

 

“Commitment” means:

 

(a)            in relation to a Bank which is a Bank
on the date of this Agreement, the amount in Sterling set opposite its name in
Schedule 1 and the amount of any other Bank’s Commitment acquired by it
under Clause 28 (Changes to the Parties); and

 

(b)           in relation to a Bank which becomes a
Bank after the date of this Agreement, the amount of any other Bank’s
Commitment acquired by it under Clause 28 (Changes to the Parties),

 

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

 

“Compliance Certificate” means a certificate substantially in
the form of Schedule 8.

 

“Consolidated EBIT” means, in relation to any Accounting
Period of the Group, the consolidated operating profit of the Group for that
Accounting Period calculated by reference to the Accounts of the Group for that
Accounting Period and:

 

(a)            before deducting, charging or
providing for:

 

(i)           Consolidated Net Interest Expense;
and

 

(ii)          any taxation as shown in the profit
and loss section of those Accounts for that Accounting Period;

 

(b)           before taking into account any
exceptional items (including, without limitation, profits or losses on the sale
or termination of an operation, costs of a fundamental reorganisation or
restructuring and profits or losses on the disposal of fixed assets) as shown
in the profit and loss section of the Accounts of the Group for that
Accounting Period; and

 

(c)            before taking into account any charge
or credit to operating profit on the SARS Scheme.

 

“Consolidated EBITA” means, in relation to any Accounting
Period of the Group, the consolidated operating profit of the Group for that
Accounting Period calculated by reference to the Accounts of the Group for that
Accounting Period and:

 

(a)            before deducting, charging or
providing for:

 

(i)           Consolidated Net Interest Expense;

 

3

 

(ii)          any taxation as shown in the profit
and loss section of those Accounts for that Accounting Period;

 

(iii)         amortisation charged during that
Accounting Period;

 

(b)           before taking into account any
exceptional items (including, without limitation, profits or losses on the sale
or termination of an operation, costs of a fundamental reorganisation or
restructuring and profits or losses on the disposal of fixed assets) as shown
in the profit and loss section of the Accounts of the Group for that
Accounting Period; and

 

(c)            before taking into account any charge
or credit to operating profit on the SARS Scheme.

 

“Consolidated EBITDA” means, in relation to any Accounting
Period, the consolidated operating profit of the Group for that Accounting
Period calculated by reference to the Accounts for that Accounting Period and:

 

(a)            before deducting, charging or
providing for:

 

(i)           Consolidated Net Interest Expense;

 

(ii)          any taxation as shown in the profit
and loss section of those Accounts for that Accounting Period;

 

(iii)         depreciation in respect of that
Accounting Period; and

 

(iv)         amortisation charged during that
Accounting Period; and

 

(b)           before taking into account any
exceptional items (including, without limitation, profits or losses on the sale
or termination of an operation, costs of a fundamental reorganisation or
restructuring and profits or losses on the disposal of fixed assets) as shown
in the profit and loss section of the Accounts of the Group for that
Accounting Period; and

 

(c)            before taking into account any charge
or credit to operating profit on the SARS Scheme.

 

“Consolidated Interest Expense” means, in relation to any
Accounting Period, all interest, acceptance commission and any other
continuing, regular or periodic costs and expenses in the nature of interest
(whether paid, payable or capitalised) incurred by the Group (other than interest paid or payable to
another member of the Group) during that Accounting Period.

 

“Consolidated Interest Receivable” means, in relation to any
Accounting Period, all interest received or receivable by any member of the
Group (other than interest received or receivable from another member of the
Group) during that Accounting Period.

 

“Consolidated Net Debt” means, at any time and without double
counting, Total Consolidated Debt less Cash and Cash Equivalents at that time.

 

“Consolidated Net Interest Expense” means, in relation to any
Accounting Period, Consolidated Interest Expense for that period less
Consolidated Interest Receivable for that period.

 

“Consolidated Net Worth” means, at any date, the sum for the
Company and its Subsidiaries (without duplication) of:

 

4

 

(a)            that amount paid up or credited as
being paid upon the called-up share capital, plus (or minus in the case of a
negative amount);

 

(b)           that amount credited to the share
premium account, plus (or minus in the case of a negative amount);

 

(c)            that amount credited to the capital
redemption reserve, plus (or minus in the case of a negative amount);

 

(d)           that amount then credited to the
profit and loss account (excluding any amounts attributable to any dividend or
other distribution at the time declared, recommended or made by the Company);
plus

 

(e)            any amount credited as, or
constituting, other non-distributable reserves (other than, for the avoidance
of doubt, the revaluation reserve),

 

all as determined
by reference to the then most recent audited, or interim, as the case may be,
consolidated balance sheet of the Company and its Subsidiaries required to be
provided under Clause 19.2(a) (Financial Information)
or, prior to the Normalisation Date the then most recent quarterly consolidated
balance sheet of the Company and its Subsidiaries required to be provided under
Clause 19.2(a) (Financial Information),
provided that:

 

(i)             any write-off or write downs
associated with any goodwill or impairment charges and amortisation of goodwill
will not be added back; and

 

(ii)            there shall be no increase or
decrease in reserves attributable to translating non-Sterling balances at
exchange rates different to those used in the financial statements for the financial
year ended 31 December 2002.

 

“Consolidated Total Assets” means, at any time, the
consolidated fixed assets and consolidated current assets of the Group as shown
in its Balance Sheet excluding, for the avoidance of doubt, goodwill and
investments in joint ventures.

 

“Dangerous Substances” 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), the generation, transportation, storage, treatment,
use or disposal of which (whether alone or in combination with any other
substance) gives a risk of causing harm to man or any other living organism or
damaging in any material respect the environment or public health or welfare,
including, but not limited to, any controlled, special, hazardous, toxic,
radioactive or dangerous waste.

 

“Default” means an Event of Default or a Potential Event of
Default.

 

“Designated Debt Subsidiaries” means:

 

(a)            HellermanTyton Pte Limited (provided
that at least 75 per cent. of all of its Voting Shares, other equity interests
and voting interests are at all time owned directly or indirectly by the
Company (except directors’ qualifying shares and shares or other equity
interests owned by directors or employers to the extent such ownership is required
to comply with applicable local law or regulation)); or

 

(b)           HellermanTyton (Wuxi) Electrical
Accessories Co. Ltd (provided that at least 75 per cent. of all of its Voting
Shares, other equity interests and voting interests are at all times

 

5

 

 

owned directly or
indirectly by the Company (except directors’ qualifying shares and shares or
other equity interests owned by directors or employers to the extent such
ownership is required to comply with applicable local law or regulation)).

 

“Drawdown Date” means the date of the making of a Loan.

 

“EBIT” means, in relation to any Accounting Period for the
Company or any Material Subsidiary, the operating profit of the Company or that
Material Subsidiary (as applicable) for that Accounting Period calculated by
reference to the Accounts of the Company or that Material Subsidiary (as
applicable) for that Accounting Period and:

 

(a)            before deducting, charging or
providing for:

 

(i)           all interest, acceptance commission and
any other continuing, regular or periodic costs and expenses in the nature of
interest (whether paid, payable or capitalised) incurred by the Company or that
Material Subsidiary (as applicable) during that Accounting Period less all
interest received or receivable by the Company or that Material Subsidiary (as
applicable) during that Accounting Period; and

 

(ii)          any taxation as shown in the profit
and loss section of those Accounts for that Accounting Period;

 

(b)           before taking into account any
exceptional items (including, without limitation, profits or losses on the sale
or termination of an operation, costs of a fundamental reorganisation or
restructuring and profits or losses on the disposal of fixed assets) as shown
in the profit and loss section of those Accounts for that Accounting
Period; and

 

(c)            before taking into account any charge
or credit to operating profit on the SARS Scheme.

 

“Environmental Claim” means any claim by any person:

 

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

 

(b)           giving rise to any remedy or penalty
that may be enforced or assessed by private or public legal action as a result
of environmental contamination or any application for any interim or financial,
judicial or administrative decree, injunction, cease and desist order,
abatement order, compliance order, consent order, clean-up order, or
enforcement notice, stop notice, improvement notice, prohibition notice or revocation
order in respect of that environmental contamination; or

 

(c)            in respect of any other remedial
action or action to comply that the relevant person is obliged to take pursuant
to any Environmental Law in respect of any environmental contamination.

 

“Environmental Law” means any common or statutory law or
regulation concerning the protection of human health, any living organism, the
workplace or the environment or the conditions of the workplace or the
generation, transportation, storage, treatment or disposal of Dangerous
Substances.

 

6

 

“ERISA” means the United States Employee Retirement Income
Security Act of 1974, as amended from time to time, and the rules and
regulations promulgated thereunder from time to time in effect.

 

“ERISA Affiliate” means any person treated as a single
employer with any Obligor for the purpose of Section 414 of the Code.

 

“EURIBOR” means, in relation to any Loan in euro:

 

(a)            the applicable Screen Rate; or

 

(b)           if no Screen Rate is available or
Interest Period of that Loan or overdue amount, the arithmetic mean (rounded
upward to four decimal places) of the rates, as supplied to the Agent at its
request, quoted by the Reference Banks to leading banks in the European interbank
market,

 

as of
11:00 a.m. on the Rate Fixing Day for the offering of deposits in euro for
a period comparable to that Interest Period.

 

“euro” or “€” means the
single currency of the Participating Member States.

 

“Event of Default” means an event specified as such in Clause
20.1 (Events of Default).

 

“Executive Order” means the Executive Order No. 13224 of
23 September 2001 - Blocking Property and Prohibiting Transactions With
Persons Who Commit, Threaten To Commit, or Support Terrorism.

 

“Existing Facility” means the syndicated credit facility
dated 4 February 2004 between (among others) the Company, Commerzbank AG,
HSBC Bank plc, Lloyds TSB Bank plc, The Royal Bank of Scotland plc, Bank One NA
London and Svenska Handelsbanken AB (publ).

 

“Facility” means a credit facility made available under this
Agreement.

 

“Facility Office” means the office(s) notified by a Bank to
the Agent:

 

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

 

(b)           by not less than 5 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 entered into by reference to
this Agreement between the Agent and the Company setting out the amount of
agency fees referred to in this Agreement.

 

“Final Maturity Date” means:

 

(a)            for a Revolving Credit Loan, subject
to Clause 2.4 (Extension of Final Maturity Date),
1 February 2006 (being the date which is 364 days from the Commencement
Date); and

 

(b)           for the Term Loan, the date which is
12 months from the date of exercise of the term-out option in accordance with
Clause 2.5 (Term-out Option).

 

“Finance Document” means:

 

(a)            this Agreement;

 

(b)           a Novation Certificate;

 

7

 

(c)            the Fee Letter;

 

(d)           a Borrower Accession Agreement;

 

(e)            a Guarantor Accession Agreement; or

 

(f)            any other document designated as such
by the Agent and the Company.

 

“Finance Party” means an Arranger, a Bank or the Agent.

 

“Financial Indebtedness” means any indebtedness (without
double counting) in respect of:

 

(a)            moneys borrowed;

 

(b)           any debenture, bond, note, loan stock
or other similar security;

 

(c)            any acceptance credit;

 

(d)           receivables sold or discounted (to
the extent of recourse);

 

(e)            the acquisition cost of any asset to
the extent payable before or after the time of acquisition or possession by the
party liable where the advance or deferred payment is arranged primarily as a
method of raising finance or financing the acquisition of that asset and, for
the purposes of Clause 19.8 (Preferred Indebtedness),
to the extent that it is required by generally accepted U.K. accounting
principles to be shown as a borrowing in the Accounts of the relevant company;

 

(f)            any lease entered into primarily as a
method of raising finance or financing the acquisition of the asset leased and
required to be accounted for as a finance lease under SSAP 21 or FRS 5;

 

(g)           any currency swap or interest swap,
cap or collar arrangement or any other derivative instrument the amount of
which will be calculated on a mark to market basis;

 

(h)           any amount raised under any other
transaction having the commercial effect of a borrowing or raising of money; or

 

(i)             any guarantee, indemnity, counter
indemnity or similar assurance against financial loss of any person given for a
type of indebtedness referred to in paragraphs (a) to (h) above.

 

“FRS” means a financial reporting standard issued by the
Accounting Standards Board.

 

“Group” means the Company and its Subsidiaries.

 

“Group Finance Director” means Eric Hutchinson or any other
person that becomes group finance director of the Company.

 

“Guarantor” means, subject to Clause 28.7 (Removal of Obligors) and Clause 28.8 (Release of
certain Guarantors), the Company, the Initial Guarantors or an
Additional Guarantor.

 

“Guarantor Accession Agreement” means a letter substantially
in the form of Part III of Schedule 5 with such amendments as the
Agent and the Company may agree.

 

“Hedging Arrangement” means any derivative hedging
transaction entered into by a member of the Group on standard (or more
favourable than standard) terms and conditions in order to mitigate interest
rate or currency exchange risks.

 

8

 

“Holding Company” has the meaning given to it in
Section 736 of the Companies Act 1985.

 

“IBCA” means The Fitch IBCA Group.

 

“Initial Guarantor” means:

 

(a)            prior to the Normalisation Date, each
company listed in Part II of Schedule 9; and

 

(b)           after the Normalisation Date, each
company listed in Part III of Schedule 9.

 

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

 

“LIBOR” means for an Interest Period of any Loan or overdue
amount:

 

(a)            the applicable Screen Rate; or

 

(b)           if no Screen Rate is available for
the relevant currency or Interest Period of that Loan or overdue amount, the
arithmetic mean (rounded upward to four decimal places) of the rates, as
supplied to the Agent at its request, quoted by the Reference Banks to leading
banks in the London interbank market,

 

as of
11:00 a.m. on the Rate Fixing Day for the offering of deposits in the
currency of that Loan or overdue amount for a period comparable to that Interest
Period.

 

“Loan” means, subject to Clauses 8 (Interest
Periods) and 10 (Optional Currencies),
the principal amount of each borrowing by a Borrower under this Agreement or
the principal amount outstanding of that borrowing.

 

“Majority Banks” means, at any time:

 

(a)            if any Loan is outstanding, Banks
with an aggregate outstanding Original Sterling Amount of participations in
Loans at that time of more than 662/3 per cent. of the
aggregate Original Sterling Amount of all Loans then outstanding; or

 

(b)           if no Loan is outstanding, Banks
whose Commitments then aggregate more than 662/3 per
cent. of the Total Commitments (or, if the Total Commitments have been reduced
to zero, aggregated more than 662/3 per cent. of the
Total Commitments immediately before the reduction).

 

“Mandatory Cost” means the cost of complying with certain
regulatory requirements, expressed as a percentage rate per annum and
calculated by the Agent under Schedule 3.

 

“Margin” means, subject to Clause 9.5 (Adjustment
of the Margin), 0.875 per cent. per annum.

 

“Margin Certificate” means a certificate substantially in the
form of Schedule 7.

 

“Material Adverse Effect” means a material adverse effect:

 

(a)            on the business or financial
condition of the Group as a whole; or

 

(b)           on the ability of the Company to
perform:

 

(i)           any of its payment obligations under
the Finance Documents; or

 

(ii)          any of its obligations under Clause
19.10 (Financial covenants).

 

9

 

“Material Subsidiary” means:

 

(a)            before any Compliance Certificate is
delivered under Clause 19.2(a) (Financial information),
each Subsidiary of the Company listed in Part I of Schedule 9; or

 

(b)           each Subsidiary of the Company listed
in the Compliance Certificate most recently provided to the Agent under Clause
19.2(a) (Financial information); or

 

(c)            each Subsidiary of the Company listed
in Part II of Schedule 9,

 

so long as it is a
Subsidiary of the Company.

 

“Moody’s” means Moody’s Investors Service, Limited.

 

“Multiemployer Plan” means a “multiemployer plan” within the meaning of Section 3(37) or
4001(a)(3) of ERISA.

 

“Net Distributable Earnings” means

 

(a)            in the case of the Company, funds
available for distribution, subject to Section 264 of the Companies Act
1985, being the accumulated, realised profits of the Company less the
accumulated, realised losses of the Company, as defined in
Section 263(3) of the Companies Act 1985, and with reference to the
Company’s Accounts, as prepared in accordance with generally accepted U.K. accounting
principles; and

 

(b)           in the case of any other Obligor, funds
available for distribution less its accumulated, realised losses determined in
accordance with analogous provisions and generally accepted accounting
principles applicable to that Obligor.

 

“Network Products Division” means the Company’s division
comprised of HellermanTyton (“HT”), divisions
of Spirent plc (divisions: HT Broadband, HT Plymouth, HT Ireland, HT BHD, HT
Manchester and the assets and business of Staeng Limited), Staeng Limited, HT
Data Limited, Spirent Australia Pty Limited, HellermanTyton GmbH,
HellermanTyton S.A., HellermanTyton Pty Limited, HellermanTyton AB,
HellermanTyton Limited, HellermanTyton Srl, HellermanTyton Corporation, Spirent
BV’s interest in HellermanTyton Pte Limited (75 per cent.), Spirent plc’s
interest in Tyton Corporation of Japan (49 per cent.) and all Subsidiaries of
such companies.

 

“Non Wholly-Owned Subsidiary” means each of HellermannTyton
Pte Limited and HellermannTyton (Wuxi) Electrical Accessories Co. Ltd.

 

“Normalisation Date” means the date the
Company delivers to the Agent a copy of a Normalisation Certificate (as defined
in the Noteholders Agreement) given to the Noteholders in accordance with the
Noteholders Agreement.

 

“Note” means any of the:

 

(a)            the amended and restated series
A senior notes due 23 November 2006;

 

(b)           the amended and restated
series B senior notes due 23 November 2009;

 

(c)            the amended and restated series
C senior notes due 23 November 2009; or

 

(d)           the amended and restated
series D senior notes due 23 November 2009,

 

each issued
pursuant to the Noteholders Agreement.

 

10

 

“Noteholder” means any person who holds a Note.

 

“Noteholders Agreement” means the note purchase agreements
dated 23 November 1999 between the Company and the Noteholders in
respect of the Notes (as amended from time to time).

 

“Novation Certificate” has the meaning given to it in Clause
28.3 (Procedure for novations).

 

“Obligor” means a Borrower or a Guarantor.

 

“Optional Currency” means:

 

(a)            U.S. Dollars; and

 

(b)           any other currency (other than
Sterling) which is for the time being freely transferable and convertible into
Sterling and deposits of which are readily available in the London interbank
market.

 

“Original Sterling Amount” means:

 

(a)            the principal amount of a Loan
denominated in Sterling; or

 

(b)           the principal amount of a Loan
denominated in an Optional Currency translated into Sterling on the basis of
the Agent’s Spot Rate of Exchange 3 Business Days before its Drawdown Date.

 

“Participating Member State” means a member state of the
European Communities that adopts the euro as its currency in accordance with
legislation of the European Union relating to European Economic and Monetary
Union.

 

“Party” means a party to this Agreement.

 

“PBGC” means the Pension Benefit Guaranty Corporation and any
entity succeeding to any of its functions under ERISA.

 

“Pension Plan” means an employee benefit pension plan or
pension plan as defined in Section 3(2) of ERISA:

 

(a)            maintained by any Obligor or any
ERISA Affiliate; or

 

(b)           to which any Obligor or any ERISA
Affiliate is required to make any payment or contribution.

 

“Permitted Bank” means:

 

(a)            any commercial bank or trust company
having, in respect of its long-term debt obligations, a rating of A or higher
by Standard & Poor’s or IBCA or A-2 or higher by Moody’s or a
comparable rating from a nationally recognised (in England) credit rating
agency; or

 

(b)           the Agent.

 

“Permitted Reorganisation” means:

 

11

 

(a)            any amalgamation, demerger, merger,
reconstruction or other reorganisation on a solvent basis of a member of the
Group (other than an Obligor) where all of the business and assets of that
member remain within the Group; or

 

(b)           any amalgamation, demerger, merger,
reconstruction, dissolution or other reorganisation on a solvent basis of an
Obligor provided that all the business and assets of that Obligor are
transferred to or assumed by one or more other Obligors (provided such Obligor
receiving the transfer or assuming the business and assets of another Obligor
is a Guarantor after the Normalisation Date or becomes a Guarantor after the
Normalisation Date); or

 

(c)            any other reorganisation of one or
more members of the Group approved by the Majority Banks,

 

provided that, in
the case of paragraphs (a) and (b) above, the Company shall have
at least the same degree of control (as defined in the City Code on Takeovers
and Mergers) in respect of any relevant Subsidiary acquiring any business or
assets as it had in respect of the Subsidiary transferring those businesses or
assets.

 

“Potential Event of Default” means an event or circumstance
which, with the giving of notice and/or lapse of time and/or fulfilment of any
other applicable condition, as provided in Clause 20.1 (Events of Default), would constitute an Event of Default.

 

“Preferred Indebtedness” means the principal amount of
Financial Indebtedness (or in the case of any derivative transaction, the mark
to market value of that derivative transaction) of:

 

(a)            all members of the Group which are
secured by Security Interests; and

 

(b)           all Total Subsidiary Debt.

 

“Preferred Shares” means any class of share capital of an
entity that is preferred over any other class of capital shares of such entity
as to the payment of dividends or the payment of any amount upon liquidation or
dissolution of such entity.

 

“Qualifying Bank” means:

 

(a)            in respect of the UK:

 

(i)           a U.K. Bank;

 

(ii)          a U.K. Treaty Bank; or

 

(b)           in respect of the U.S., a U.S. Bank
or a U.S. Treaty Bank.

 

“Rate Fixing Day” means:

 

(a)            the first day of an Interest Period
for a Loan denominated in Sterling;

 

(b)           the second TARGET Business Day before
the first day of an Interest Period for a Loan denominated in euros; or

 

(c)            the 2nd Business Day before the first
day of an Interest Period for a Loan denominated in any currency other than
Sterling or euros,

 

12

 

or such other day
as is generally treated as the rate fixing day by market practice in the London
interbank market for the currency concerned, as notified by the Agent to the
other Parties by not less than 5 Business Days’ notice.

 

“Reference Banks” means, subject to Clause 28.9 (Reference Banks), HSBC Bank plc and Lloyds TSB Bank plc and
any other bank or financial institution appointed as such by the Agent in
consultation with the Company under this Agreement.

 

“Regulation D” means Regulation D of the Board of Governors
of the Federal Reserve System (or any successor).

 

“Regulation D Costs” means, in relation to its participation
in a Loan made to a U.S. Borrower (or deposits maintained by a Bank to fund
that participation), the amount (if any) certified by a Bank to be the cost to
it of complying with Regulation D (or any similar reserve requirements) in
respect of its participation or those deposits.

 

“Reporting Accountant” means PricewaterhouseCoopers or any
other accountant appointed by the Agent.

 

“Request” means a request made by a Borrower to utilise the
Facility, substantially in the form of Part I of Schedule 4.

 

“Restricted Party” means any person listed:

 

(a)            in the Annex to the Executive Order;

 

(b)           on the “Specially Designated
Nationals and Blocked Persons” list maintained by the Office of Foreign Assets
Control of the United States Department of the Treasury; or

 

(c)            in any successor list to either of
the foregoing.

 

“Revolving Credit Loan” means a Loan borrowed under the
Facility before the term-out option in Clause 2.5 (Term-out
Option) has been exercised.

 

“Rollover Loan” means a Revolving Credit Loan:

 

(a)            which is being made solely to
refinance an outstanding Revolving Credit Loan;

 

(b)           whose Original Sterling Amount is
equal to or less than that outstanding Revolving Credit Loan; and

 

(c)            whose Drawdown Date coincides with
the last day of the Interest Period for that outstanding Revolving Credit Loan.

 

“SARS Scheme” means the Spirent Stock
Incentive Plan which was approved by Ordinary Resolution of the shareholders of
the Company on 23 June 2004.

 

“Screen Rate” means:

 

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

 

13

 

displayed on the
appropriate page of the Reuters screen selected by the Agent. If the
relevant page is replaced or the service ceases to be available, the Agent
(after consultation with the Company and the Banks) may specify another
page or service displaying the appropriate rate.

 

“Security Interest” means any mortgage, charge, assignment,
pledge, lien, hypothecation or security interest or any other agreement having
the effect of conferring security but, for the avoidance of doubt, excluding
any finance lease.

 

“Selection Notice” means a notice substantially in the form
set out in Part II of Schedule 4 given in accordance with Clause 8 (Interest Periods).

 

“SSAP” means a standard of accounting practice issued by the
Accounting Standards Committee.

 

“Standard & Poor’s” means Standard & Poor’s
Rating Services, a division of McGraw Hill Companies Inc.

 

“Sterling” or “£” means the
lawful currency for the time being of the U.K.

 

“Subsidiary” means:

 

(a)            a subsidiary within the meaning of
Section 736 of the Companies Act 1985; and

 

(b)           in relation to the financial
statements or any financial covenants in respect of the Group, a subsidiary
undertaking within the meaning of Section 258 of the Companies Act 1985.

 

“Systems-Drives Division” means the business and assets of PG
Drives Technology Limited owned by each of Spirent plc, PG International plc,
PG Drives Technology Limited and PG Drives Technology Inc.

 

“TARGET Business Day” means a day on which the Trans-European
Real-Time Gross Settlement (TARGET) System is open.

 

“Taxes” includes all present and future income and other
taxes, levies, imposts, deductions and charges and withholdings whatsoever
together with interest thereon and penalties with respect thereto, if any, and
any payments made on or in respect thereof;

 

“Taxation” and “Tax” shall be construed accordingly.

 

“Term Loan” means the Loan borrowed under the Facility after
the term-out option in Clause 2.5 (Term out
Option) has been exercised.

 

“Total Assets” means, at any time in respect of the Company
or any Material Subsidiary, the fixed assets and current assets of the Company
or that Material Subsidiary (as applicable) as shown in the then latest balance
sheet of the Company or that Material Subsidiary (as applicable) excluding, for
the avoidance of doubt, goodwill.

 

“Total Commitments” means, at any time, the aggregate of the
Commitments being £30,000,000 at the date of this Agreement.

 

“Total Consolidated Debt” means at any time the aggregate
(without double counting) of the following:

 

14

 

(a)            the outstanding principal amount of
any moneys borrowed by any member of the Group and any outstanding overdraft
debit balance of any member of the Group (but subject to set-off in accordance
with generally accepted U.K. accounting principles);

 

(b)           the outstanding principal amount of
any debenture, bond, note, loan stock or other similar security of any member
of the Group;

 

(c)            the outstanding principal amount of
any acceptance under any acceptance credit opened by a bank or other financial
institution in favour of any member of the Group;

 

(d)           any amount raised pursuant to any
issue of shares which are or may be expressed to be redeemable at the
insistence of the holder at any time prior to the date on which all amounts due
and owing by the Obligors or any of them to any of the Finance Parties
hereunder, whether present or future, actual or contingent, have been irrevocably
and unconditionally discharged in full;

 

(e)            the outstanding principal amount of
all moneys owing by a member of the Group in connection with the sale or
discounting of receivables (to the extent of recourse to that member of the
Group);

 

(f)            the outstanding principal amount of
any indebtedness of any member of the Group arising from any advance or
deferred payment agreements arranged primarily as a method of raising finance
or financing the acquisition of an asset to the extent that is required by generally
accepted U.K. accounting principles to be shown as a borrowing in the Accounts;

 

(g)           the capitalised element of
indebtedness of any member of the Group in respect of a lease entered into
primarily as a method of raising finance or financing the acquisition of the
asset leased and required to be accounted for under SSAP 21 or FRS 5;

 

(h)           any fixed or minimum premium on the
repayment or redemption at maturity of any instrument referred to in paragraph
(b) above which is or may be expressed to be payable at any time prior to
the date on which all amounts due and owing by the Obligors or any of them to
any of the Finance Parties hereunder, whether present or future, actual or
contingent, have been irrevocably and unconditionally discharged in full; and

 

(i)             the outstanding principal amount of
any indebtedness of any person of a type referred to in paragraphs (a) -
(h) above which is the subject of a guarantee, indemnity or similar
assurance against financial loss given by any member of the Group.

 

“Total Subsidiary Debt” means, at any time without
duplication, the aggregate amount of:

 

(a)            the aggregate Financial Indebtedness
of each Subsidiary (whether or not a Subsidiary is a Guarantor) outstanding at
such time; plus

 

(b)           all claims in respect of the redemption
of, and accumulated, unpaid dividends on, all Preferred Shares (and all
securities convertible into, exchangeable for, or representing the right to
purchase, Preferred Shares) of each Subsidiary whether or not a Subsidiary

 

15

 

is a Guarantor and
whether or not any right of redemption or conversion is exercisable by the
holder thereof at any time,

 

but excluding from
such calculation:

 

(i)             any Financial Indebtedness of any
Subsidiary owing to the Company, any Guarantor or any Wholly-Owned Subsidiary;

 

(ii)            all such Financial Indebtedness of
any Subsidiary owing to any Designated Debt Subsidiary which is not a Guarantor
or a Wholly-Owned Subsidiary provided that the amount of such Financial
Indebtedness under this sub-paragraph (ii) shall not exceed £2,500,000 in
aggregate and shall have been incurred solely for cash management purposes in
the ordinary course of business and consistent with past practices;

 

(iii)           all Preferred Shares and other
securities which are legal and beneficially owned by any of the Company, any
Guarantor or any Wholly-Owned Subsidiary;

 

(iv)          Financial Indebtedness of any person
which becomes a Subsidiary after the date of this Agreement for a period of up
to 180 days after the date such person becomes a Subsidiary (other than
Financial Indebtedness incurred or contractually bound to be incurred solely in
contemplation of such person becoming a Subsidiary), provided that:

 

(A)         the Subsidiary executes a Guarantor
Accession Agreement within 10 Business Days of the date that the Subsidiary
becomes a Subsidiary; and

 

(B)          the Subsidiary shall not enter into
any other guarantee or similar obligation in favour of any other person prior
to it having executed a Guarantor Accession Agreement;

 

(v)           all Financial Indebtedness of the
Subsidiaries outstanding on 31 December 2004 and identified in
Schedule 8 (including any extensions, renewals and refinancing of such
Financial Indebtedness) to the extent that the principal amount of such Financial
Indebtedness is not increased;

 

(vi)          all Financial Indebtedness owing
under the Finance Documents; and

 

(vii)         the guarantee given by a Guarantor
under or in connection with the Noteholders Agreement.

 

“U.K.” means the United Kingdom.

 

“U.K. Bank” means a Bank which is:

 

(a)            within the charge to U.K. corporation
tax in respect of, and beneficially entitled to, a payment of interest on a
Loan made by a person that was a bank for the purposes of Section 349 of
the Taxes Act (as currently defined in Section 840A of the Taxes Act) at
the time the Loan was made; or

 

(b)           a U.K. Non-Bank Lender.

 

“U.K. Non-Bank Lender” means:

 

(a)            a company resident in the U.K. for
U.K. tax purposes;

 

16

 

(b)           a partnership, each member of which
is a company resident in the U.K. for U.K. tax purposes or a company not
resident in the U.K. for U.K. tax purposes but which carries on a trade in the
U.K. through a branch or agency and brings into account in computing its
chargeable profits (for the purpose of Section 11(2) of the Taxes
Act) the whole of any share of interest payable to it under this Agreement
which falls to it by reason of Sections 114 and 115 of the Taxes Act; or

 

(c)            a company not resident in the U.K.
for U.K. tax purposes which carries on a trade in the U.K. through a branch or
agency and brings into account interest payable to it under this Agreement in
computing its chargeable profits for the purpose of Section 11(2) of
the Taxes Act,

 

which is
beneficially entitled to payments made to it under this Agreement and which has
provided to the Company and not retracted confirmation of the above in
accordance with this Agreement.

 

“U.K. Treaty Bank” means any person to whom payments of
interest and fees on the Loans may be made free from U.K. withholding tax or
deduction for or on account of tax by virtue of a double tax treaty entered
into between the U.K. and the jurisdiction in which that person is resident.

 

“U.S.” means the United States of America.

 

“U.S. Bank” means a bank or financial institution
incorporated or organised under the laws of the U.S. or any state of the U.S.
(including the District of Columbia) or any branch or office located in the
U.S. through which any Bank is participating in any Loan and with respect to which
interest and fees under this Agreement are treated as effectively connected
income.

 

“U.S. Borrower” means a Borrower which is incorporated in the
U.S.

 

“U.S. Dollars” or “U.S.$” means
the lawful currency for the time being of the U.S.

 

“U.S. Material Subsidiary” means a Material Subsidiary which
is incorporated in the U.S.

 

“U.S. Obligor” means an Obligor incorporated or organised
under the laws of the U.S. or any state of the U.S. (including the District of
Columbia).

 

“U.S. Person” has the meaning given to United States person
in Section 7701(a)(30) of the Code.

 

“U.S. Treaty Bank” means a Bank which is entitled to the
benefit of a double taxation treaty between the U.S. and the jurisdiction in
which that Bank is resident under which payments of interest and fees under
this Agreement may be made free of U.S. withholding tax to that Bank.

 

“Voting Shares” means the capital shares of any class or
classes of an entity having power under ordinary circumstances to vote for the
election of members of the board of directors or similar governing body of such
entity, or persons performing similar functions (irrespective of whether or not
at the time shares of any other class or classes shall have or might have
special voting power or rights by reason of the happening of any contingency).

 

“Wholly-Owned Subsidiary” means, at any time, any Subsidiary
100 per cent. of all of the Voting Shares, other equity interests and voting
interests of which are owned directly or indirectly

 

17

 

by the Company
(except directors’ qualifying shares and shares or other equity interests owned
by directors or employees to the extent such ownership is required to comply
with applicable local law or regulation).

 

1.2         Construction

 

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

 

(i)             an “amendment”
includes a supplement, novation or re-enactment and “amended” is to be construed accordingly;

 

(ii)            “assets”
includes present and future properties, revenues and rights of every
description;

 

(iii)           an “authorisation”
includes an authorisation, consent, approval, resolution, licence, exemption,
filing and registration;

 

(iv)          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:

 

(A)         if the numerically corresponding day
is not a Business Day, the period will end on the next Business Day in that
month (if there is one) or the preceding Business Day (if there is not);

 

(B)          if there is no numerically
corresponding day in that month, that period will end on the last Business Day
in that month; and

 

(C)          notwithstanding sub-paragraph
(A) above, a period which commences on the last Business Day of a month
will end on the last Business Day in the next month or the calendar month in
which it is to end, as appropriate.

 

(v)           a “person”
includes any person, company, partnership, association, government, state,
agency or other entity or any of its successors and assigns;

 

(vi)          a “regulation”
includes any regulation, rule, official directive, request or guideline
(whether or not having the force of law but, if not having the force of law,
being of a type which the person to whom it applies is accustomed to comply) of
any governmental, inter-governmental or supranational body, agency, department
or regulatory, self-regulatory or other authority or organisation;

 

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

 

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

 

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

 

(x)            a Finance Document or another
document is a reference to that Finance Document or other document as amended;
and

 

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

 

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

 

18

 

(c)         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 Contract (Rights of Third
Parties) Act 1999 and notwithstanding any term of any Finance Document, the
consent of any third party is not required for any variation (including any
release or compromise or any liability) or termination of that Finance
Document.

 

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

 

2.           THE FACILITY

 

2.1         Facility

 

(a)         Subject to the terms of this
Agreement, the Banks agree to make available to the Borrowers a committed
multicurrency revolving credit facility with a term-out option under which the
Banks agree to make Loans to the Borrowers up to an aggregate outstanding
Original Sterling Amount not exceeding the Total Commitments.

 

(b)         No Bank is obliged to lend if it
would cause the Original Sterling Amount of the aggregate of its participations
in the Loans to exceed its Commitment.

 

2.2         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.

 

2.3         Number of Loans and currencies

 

Unless otherwise
agreed by the Agent, no more than 20 Loans may be outstanding at any time and
Loans may not be denominated in more than eight currencies at any time.

 

2.4         Extension of Final Maturity Date

 

(a)         The Company may request (“Extension Request”) that the Final Maturity
Date and the Availability Period be extended, each for a further period of 364
days by giving notice to the Agent no more than 60 days, and not less than
30 days, before the original Final Maturity Date, which must include the
fee proposed to be paid by the Company under Clause 22.4 (Extension fee).

 

(b)         Upon receipt of an Extension Request,
the Agent shall promptly notify each Bank. Each such Bank shall have the right,
in its absolute discretion, to accept or decline any Extension Request and any
such Bank which wishes to accept the Extension Request shall so notify the
Agent no later than the date falling 15 days before the original Final Maturity
Date. If any Bank does not accept an Extension Request by that date it will be
deemed to have refused it.

 

(c)         Subject to Clause 2.6 (Relationship between the Extension Option and the Term-out Option),
on the original Final Maturity Date:

 

19

 

(i)             each Borrower shall repay the
participation in the Loans of each Bank that refuses the Extension Request in
full;

 

(ii)            the Commitment of each Bank that
refuses the Extension Request shall be cancelled automatically; and

 

(iii)           in respect of those Banks that accept
the Extension Request only (if any), the Final Maturity Date and the
Availability Period shall, respectively, be extended to the date which is 364
days after the original Final Maturity Date.

 

(d)         No more than two Extension Requests
may be given and any such request is (subject to Clause 2.6 (Relationship between the Extension Option and the
Term-out Option) irrevocable.

 

2.5         Term-out Option

 

(a)         Subject to Clause 2.6 (Relationship between the Extension Option and the Term-out Option),
the Company may by notice (“Term-out Notice”)
to the Agent at any time which is no less than 10 days prior to the original
Final Maturity Date opt to convert the Facility into a term loan facility. The
giving of this notice constitutes the exercise of the term-out option by the
Company.

 

(b)         A
Term-out Notice must specify the amount of the Facility being converted to a
term facility. The amount to be termed out shall be drawn as one Term Loan.

 

(c)         With effect from the date of the
exercise of the term-out option:

 

(i)             the next Loan borrowed after that
date will be treated as a Term Loan and the first Interest Period for such Term
Loan shall be permitted to overrun the last day of the Availability Period for
the Facility;

 

(ii)            the Final Maturity Date shall be 12
months from the date of exercise of the term-out option;

 

(iii)           any Revolving Credit Loan which is to
be prepaid on the Drawdown Date for the Term Loan may be drawn as part of the
Term Loan;

 

(iv)          to the extent not prepaid and redrawn
as part of the Term Loan, any Revolving Credit Loan outstanding on the Drawdown
Date for the Term Loan must be repaid on the last day of its Interest Period;
and

 

(v)           the unutilised amount of the Total
Commitments will be automatically cancelled at close of business on the last
day of the Availability Period for the Facility.

 

2.6         Relationship between the Extension
Option and the Term-out Option

 

The extension
option in Clause 2.4 (Extension Option)
and the term-out option in Clause 2.5 (Term-out Option)
are mutually exclusive. If a Term-out Notice has been delivered, no Extension
Request may be given. If a Term-out Notice is delivered after the delivery of
an Extension Request but before the original Final Maturity Date, that
Extension Request shall be deemed withdrawn. If the Final Maturity Date has
been extended under Clause 2.4 (Extension Option),
then a Term-out Notice may not be given.

 

2.7         Affiliates of Banks

 

(a)         Each Bank may, if it so elects,
fulfil its commitment as to any Loan by designating a branch or an Affiliate to
make that Loan. However:

 

20

 

(i)             the Bank shall remain solely
responsible for the performance of its obligations under this Agreement;

 

(ii)            no such designation shall result in
any additional costs to the Obligors (whether under this Agreement, by loss or
limitation of tax deduction or relief or otherwise); and

 

(iii)           the branch or Affiliate shall:

 

(A)         be a Qualifying Bank;

 

(B)          in the case of any U.K. Bank, be
situated in the U.K.;

 

(C)          in the case of any U.K. Treaty Bank,
be situated outside the U.K.; and

 

(D)         comply with all form, delivery and
other requirements under this Agreement.

 

(b)         A Bank may provide for an Affiliate
to participate in certain Loans in the manner contemplated in paragraph
(a) above by:

 

(i)             joining the relevant Affiliate in as
a Bank by means of a Novation Certificate in accordance with Clause 28.2 (Transfers by Banks); and

 

(ii)            giving notice to the Agent and the
Company, detailing the Loans in which that Affiliate will participate.

 

In this event that
Bank and its Affiliate:

 

(a)            will be treated as having a single
Commitment, but, for all other purposes other than that mentioned in paragraph
(c) below, will be treated as separate Banks; and

 

(b)           participate in Loans in the manner
described in sub-paragraph (ii) above.

 

(c)         For the purposes of:

 

(i)             compliance with Clause 28.2 (Transfers by Banks); and

 

(ii)            voting in connection with any Finance
Document,

 

each Bank and its
Affiliate will be regarded as a single Bank.

 

3.           PURPOSE

 

(a)         Each Borrower shall apply each Loan
borrowed by it towards refinancing the Existing Facility and for its general
corporate purposes. No Loan may be used to finance or refinance any principal
repayment or make-whole repayment to a Noteholder.

 

(b)         Without affecting the obligations of
any Borrower in any way, no Finance Party is bound to monitor or verify the
application of any Loan.

 

4.           CONDITIONS PRECEDENT

 

4.1         Documentary conditions precedent

 

A Request may not
be given until the Agent has notified the Company and the Banks that it has
received all of the documents and evidence set out in Part I of Schedule 2
(Conditions precedent documents) in form
and substance satisfactory to the Agent. The Agent must give this notification
to the Company and the Banks promptly upon being so satisfied.

 

21

 

4.2         Further conditions precedent

 

The obligations of
each Bank to participate in any Loan are subject to the further conditions
precedent that:

 

(a)            on both the date for the Request and
the Drawdown Date for that Loan:

 

(i)           the representations and warranties in
Clause 18 (Representations and Warranties) to be
repeated on those dates are correct and will be correct immediately after the
Loan is made; and

 

(ii)          no Default or (in the case of a
Rollover Loan) no Event of Default is outstanding or would result from the
Loan; and

 

(b)           the Loan would not cause Clause 2.1 (Facility) to be contravened.

 

5.           LOANS

 

5.1         Availability Period

 

A Borrower may
borrow a Loan during the Availability Period if the Agent receives, not later
than 10:00 a.m. three (or, in the case of a Loan in Sterling, one)
Business Day(s) before the proposed Drawdown Date, a duly completed Request.
Each Request is irrevocable and, subject to the terms of this Agreement, shall
oblige the Borrower to borrow the Loan.

 

5.2         Completion of Requests

 

A Request will not
be regarded as having been duly completed unless:

 

(a)            the Drawdown Date is a Business Day
falling on or before the final day of the Availability Period;

 

(b)           it identifies whether the Loan is a
Revolving Credit Loan;

 

(c)            the amount of the Loan is:

 

(i)           if the currency is Sterling, a
minimum of £3,000,000 and an integral multiple of £1,000,000;

 

(ii)          if the currency is U.S. Dollars, a
minimum of U.S.$3,000,000 and an integral multiple of U.S.$1,000,000;

 

(iii)         if the currency is euro, a minimum of
€3,000,000 and an integral multiple of €1,000,000;

 

(iv)         if the currency is an Optional
Currency other than U.S. Dollars or euro either:

 

(A)         the equivalent of a minimum of
£3,000,000 and an integral multiple of 1,000,000 units of the relevant
currency; or

 

(B)          such amount as the Agent and the
Company may agree; or

 

(v)          the balance of the undrawn Total
Commitments;

 

(d)           the amount selected under paragraph
(c) above does not cause Clause 2.1 (Facility) to be
contravened;

 

(e)            the currency selected complies with
Clause 10 (Optional Currencies);

 

22

 

(f)            the Interest Period selected complies
with Clause 8 (Interest Periods) and does not
extend beyond the Final Maturity Date; and

 

(g)           the payment instructions comply with
Clause 12 (Payments).

 

Each Request must
specify one Loan only, but the Borrowers may, subject to the other terms of
this Agreement, deliver more than one Request on any one day.

 

5.3         Advance of Loan

 

(a)         The Agent shall promptly notify each
Bank of the details of the requested Loan and the amount of its participation
in the Loan.

 

(b)         Subject to the terms of this
Agreement, each Bank shall make its participation in the Loan available to the
Agent for the relevant Borrower on the relevant Drawdown Date.

 

(c)         The amount of each Bank’s
participation in the Loan will be the proportion of the Loan which its
Commitment bears to the Total Commitments on the proposed Drawdown Date.

 

6.           REPAYMENT

 

6.1         Repayment of Revolving Credit Loans

 

Each Borrower shall
repay in full each Revolving Credit Loan on the last day of its Interest
Period.

 

6.2         Repayment of the Term Loan

 

Each Borrower shall
repay the Term Loan in full on the applicable Final Maturity Date.

 

6.3         Re-borrowing

 

Subject to the
terms of this Agreement any Revolving Credit Loan repaid under Clause 6.1
(Repayment of Revolving Credit Loans) may
be re-borrowed.

 

7.           PREPAYMENT AND CANCELLATION

 

7.1         Automatic cancellation and reduction

 

The Commitment of
each Bank shall be automatically cancelled in full at the close of business in
London on the Final Maturity Date.

 

7.2         Voluntary cancellation

 

(a)         The Company may, by giving not less
than seven days’ prior notice to the Agent (or such shorter period as the
Majority Banks may agree) cancel the unutilised portion of the Total
Commitments in whole or in part (but, if in part, in a minimum of £5,000,000
and an integral multiple of £1,000,000).

 

(b)         Any cancellation in part shall be
applied against the Commitment of each Bank pro rata.

 

7.3         Mandatory prepayment - change of
control

 

(a)

 

(i)             If any person, or group of persons
acting in concert (as defined in the
City Code on Takeovers and Mergers) acquires control (as defined in the
City Code on Takeovers and Mergers) of the Company, the Company shall
immediately notify the Agent.

 

(ii)            On the date falling 5 Business Days
after notice under sub-paragraph (i) above:

 

23

 

(A)         the Facility shall be cancelled; and

 

(B)          each Borrower shall prepay all Loans
made to it together with accrued interest and all other amounts payable by it
under the Finance Documents.

 

(b)

 

(i)             If any Borrower ceases to be
beneficially wholly-owned by the Company, the Company shall immediately notify
the Agent. For this purpose, a Borrower will be regarded as wholly-owned if a
portion of the share capital is required to be held by law by officers of that
Borrower.

 

(ii)            On the date falling 5 Business Days
after notice under sub-paragraph (i) above the relevant Borrower shall
either:

 

(A)         prepay all Loans made to it together
with accrued interest and all other amounts payable by it under the Finance
Documents; or

 

(B)          transfer its obligations under the
Finance Documents to another Borrower pursuant to Clause 28.1(b) (Transfers by Obligors).

 

(iii)           Any amount of a Revolving Credit Loan
prepaid under sub-paragraph (ii)(A) above shall, subject to the other
terms of this Agreement, remain available for re-borrowing by any other
Borrower.

 

7.4         Voluntary prepayment

 

A Borrower may, by
giving not less than seven days’ prior notice to the Agent and, subject to
Clause 25.2(d) (Other indemnities),
prepay any Loan in whole or in part (but, if in part, in a minimum Original
Sterling Amount of £5,000,000 and an integral multiple of £1,000,000).

 

7.5         Additional right of prepayment and
cancellation

 

(a)         If:

 

(i)             a Borrower is required to pay to a
Bank any additional amounts under Clause 13 (Taxes);
or

 

(ii)            a Borrower is required to pay to a
Bank any amount under Clause 15 (Increased Costs); or

 

(iii)           interest on a Bank’s participation in
a Loan is being calculated in accordance with Clause 14.3(d) (Alternative basis),

 

and that Borrower
has not transferred its obligations under the Finance Documents in accordance
with Clause 28.1 (Transfers by Obligors) to another
Borrower, then, without prejudice to the obligations of any Obligor under those
Clauses, the Company may, whilst the circumstances giving rise to the
requirement continue, serve a notice of prepayment and cancellation on that
Bank through the Agent. On the date falling 2 Business Days after the date of
service of the notice and subject to Clause 25.2(d) (Other
indemnities):

 

(a)            that Borrower shall prepay that
Bank’s participation in all the Loans made to it; and

 

(b)           if the notice given by the Company so
specifies, the Commitment of that Bank shall be cancelled.

 

24

 

(b)         Any amount of a Revolving Credit Loan
prepaid under paragraph (a) above shall, subject to the other terms of
this Agreement, remain available for re-borrowing by any other Borrower.

 

7.6         Mitigation

 

If, in respect of
any Bank, circumstances arise which would, or would on the giving of notice,
result in:

 

(a)            any additional amounts becoming
payable under Clause 13 (Taxes); or

 

(b)           any amount becoming payable under
Clause 15 (Increased Costs); or

 

(c)            any prepayment, early payment or
cancellation under Clause 16 (Illegality),

 

then, without in
any way limiting, reducing or otherwise qualifying the obligations of any
Obligor under this Agreement and without prejudice to the terms of those
Clauses, that Bank shall, in consultation with, and at the reasonable expense
of, the Company through the Agent and to the extent that it can do so lawfully,
take such reasonable steps as may be open to it to mitigate or remove such
circumstances, including (without limitation) the transfer of its rights and
obligations under this Agreement to another branch or an Affiliate or another
bank or financial institution nominated by the Company, unless to do so might
(in the reasonable opinion of the Bank) be prejudicial to it.

 

7.7         Miscellaneous provisions

 

(a)         Any notice of prepayment and/or
cancellation under this Agreement is irrevocable. The Agent shall notify the
Banks 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, subject
to Clause 25.2(d) (Other indemnities),
without premium or penalty.

 

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

 

(d)         No amount of the Total Commitments
cancelled under this Agreement may subsequently be reinstated.

 

(e)         Without prejudice to the right of a
Borrower to re-borrow amounts of Revolving Credit Loans repaid under
Clause 6.1 (Repayment of Revolving Credit Loans)
in accordance with Clause 6.3 (Re-borrowing)
or amounts prepaid under Clause 7.3(b)(iii) (Mandatory prepayment - change of control) or Clause
7.5(b) (Additional right of prepayment and
cancellation), no amount of a Revolving Credit Loan repaid or
prepaid under any other provision of this Agreement may subsequently be
re-borrowed.

 

(f)          No amount of the Term Loan prepaid
under this Agreement may subsequently be re-borrowed.

 

8.           INTEREST PERIODS

 

8.1         Selection - Revolving Credit Loans

 

(a)         Each Revolving Credit Loan has one
Interest Period only.

 

(b)         A Borrower may select the Interest
Period for a Revolving Credit Loan in the relevant Request. Each Interest
Period for a Revolving Credit Loan will commence on its Drawdown Date.

 

25

 

(c)         Subject to the following provisions
of this Clause 8, each Interest Period for a Revolving Credit Loan will be one,
two, three or six months or any other period agreed by the relevant Borrower
and the Banks.

 

8.2         Selection - Term Loan

 

(a)         The Term Loan has successive Interest
Periods.

 

(b)         A Borrower may select the first
Interest Period for the Term Loan in the relevant Request and each subsequent
Interest Period in a Selection Notice received by the Agent not later than
11:00 a.m. 1 Business Day before the Rate Fixing Day for that
Interest Period. Each Interest Period for the Term Loan will start on its
Drawdown Date or on the expiry of its preceding Interest Period.

 

(c)         If the relevant Borrower fails to
select an Interest Period for the outstanding Term Loan under paragraph
(b) above, that Interest Period will, subject to the other provisions of
this Clause, be three months.

 

(d)         Subject to the following provisions
of this Clause, each Interest Period for the Term Loan will be one, two, three
or six months or any other period agreed by the relevant Borrower and the
Banks.

 

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         Coincidence with repayment dates

 

If an Interest
Period for a Loan would otherwise overrun the Final Maturity Date it will be
shortened so that it ends on the Final Maturity Date.

 

8.5         Other adjustments

 

The Agent (after
consultation with the Banks) and the Company may enter into such other
arrangements as they may agree for the adjustment of Interest Periods and the
consolidation and/or splitting of Loans.

 

8.6         Notification

 

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

 

9.           INTEREST

 

9.1         Interest rate

 

The rate of
interest on each Loan for each of its Interest Periods is the rate per annum
determined by the Agent to be the aggregate of the applicable:

 

(a)            Margin;

 

(b)           LIBOR or, in relation to any Loan in
euro, EURIBOR; and

 

(c)            Mandatory Cost.

 

26

 

9.2         Due dates

 

Except as otherwise
provided in this Agreement, accrued interest on each Loan is payable by the
relevant Borrower on the last day of each Interest Period for that Loan and
also, if the Interest Period is longer than six months, on the dates falling at
six monthly intervals after the first day of that Interest Period.

 

9.3         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
Agent pay interest on the overdue amount from the due date up to the date of
actual payment, as well after as before judgment, at a rate (the “default rate”) determined by the Agent to
be one per cent. per annum above, subject to sub-paragraph (b) below, the
rate which would have been payable if the overdue amount had, during the period
of non-payment, constituted a Loan in the currency of the overdue amount for
such successive Interest Periods of such duration as the Agent may determine
having due regard to the likely date for payment of the overdue amount (each a
“Designated Interest Period”).

 

(b)         If the overdue amount is a principal
amount of a Loan and it becomes due and payable prior to the last day of an
Interest Period for that Loan, then:

 

(i)             the first Designated Interest Period
for that overdue sum will be the unexpired portion of that Interest Period; and

 

(ii)            the rate of interest on the overdue
amount for that first Designated Interest Period will be one per cent. per
annum above the rate on the overdue amount under Clause 9.1 (Interest rate) immediately before the due date.

 

After the expiry of
the first Designated Interest Period for that overdue amount, the rate on the
overdue amount will be calculated in accordance with sub-paragraph
(a) above.

 

(c)         The default rate will be determined
by the Agent (acting reasonably) on each Business Day or the first day of, or 2
Business Days before the first day of, the relevant Designated Interest Period,
as appropriate.

 

(d)         If the Agent (acting reasonably)
determines that deposits in the currency of the overdue amount are not at the
relevant time being made available by the Reference Banks to leading banks in
the relevant interbank market, the default rate will be determined by reference
to the cost of funds to the Agent from whatever sources it may reasonably
select.

 

(e)         Default interest will be compounded
at the end of each Designated Interest Period.

 

9.4         Notification of rates of interest

 

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

 

9.5         Adjustment of the Margin

 

(a)         From the Commencement Date until the
date of delivery of the Compliance Certificate for the financial period ended
31 December 2004 in accordance with Clause 19.2(a)(v) (Financial information) (the “margin adjustment testing date”), the Margin for the Facility
will be 0.875 per cent. per annum.

 

27

 

(b)         On and from the margin adjustment
testing date the Company must supply to the Agent a Margin Certificate signed
by two authorised signatories of the Company:

 

(i)             at the same time as each press
release issued with the preliminary results of the Company for the financial
year end of the Company; and

 

(ii)            prior to the Normalisation Date, at
the same time as the delivery of a Compliance Certificate in accordance with
Clause 19.2(a)(v) (Financial
information) in respect of the Accounting Periods ending on the
financial half year of the Company and on the first and third financial
quarters of the Group; or

 

(iii)           from the Normalisation Date, at the
same time as the delivery of a Compliance Certificate in accordance with
Clause 19.2(a)(v) (Financial
information) in respect of the financial half year,

 

for the purpose of
calculating whether the Margin in respect of a Loan is to be adjusted in
accordance with this Clause.

 

(c)         Subject to the following provisions,
the applicable Margin for a Loan will be adjusted (upwards or downwards) to the
percentage rate per annum specified in Column 2 below set opposite the range in
Column 1 below into which the ratio of Consolidated Net Debt to Consolidated
EBITDA, as shown in the relevant Margin Certificate, falls:

 

	
  Column 1

  	
   

  	
  Column 2

  	
   

  
	
  Ratio of Consolidated
  Net Debt to Consolidated

  EBITDA

  	
   

  	
  Applicable Margin (per annum)

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Greater than or equal to 2.00 to 1

  	
   

  	
  1.75 per
  cent.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Less than 2.00 to 1 but greater than or
  equal to 1.75 to 1

  	
   

  	
  1.50 per
  cent

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Less than 1.75 to 1 but greater than or
  equal to 1.25 to 1

  	
   

  	
  1.25 per
  cent.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Less than 1.25 to 1 but greater than or
  equal to 1 to 1

  	
   

  	
  1.00 per
  cent.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Less than 1 to 1 but greater than or equal
  to 0.75 to 1 

  	
   

  	
  0.875 per
  cent. 

  	
    

  
	
   

  	
   

  	
   

  	
   

  
	
  Less than 0.75 to 1 

  	
   

  	
  0.75 per
  cent. 

  	
    

  

 

(d)         The adjustment (if any) specified in
paragraph (c) above will apply only in respect of any Interest Period
commencing after the date the Company delivers the relevant Margin Certificate.

 

(e)         Whilst a Potential Event of Default
is outstanding the Margin may be increased under paragraph (c) above
but not decreased and, when no Potential Event of Default is outstanding will
revert to the applicable rate calculated under paragraph (c) above.

 

(f)          For so long as:

 

(i)             the Company is in default of its
obligation to provide the relevant Margin Certificate or to provide accounts
under Clause 19.2(a)(i)(A),(ii),(iii), or (iv) (Financial
information); or

 

(ii)            an Event of Default is outstanding;

 

the Margin for any
Loan made or outstanding in the period during which that default or Event of
Default remains outstanding will be 1.75 per cent. per annum and will
subsequently revert to the

 

28

 

applicable rate
calculated under paragraph (c) above when that default or Event of Default
ceases to be outstanding.

 

(g)         If a Margin Certificate (a “Supported Certificate”) when reconciled
against information delivered under Clause 19.2(a)(i) (Financial information) shows that in reliance on a Margin
Certificate (an ”Unsupported Certificate”)
delivered under paragraph (b)(i) above the applicable Margin of any Loan
for any Interest Period has been incorrectly adjusted or determined at a level
lower than required by paragraph (c) above, such Margin shall be
re-adjusted or re-determined with effect from the first day of such Interest
Period and if the Borrowers have, in reliance on such Unsupported Certificate,
paid to the Finance Parties an amount less than the amount which the Borrowers
would have paid if the Supported Certificate had been delivered to the Agent
instead of the Unsupported Certificate, the Company shall, within 5 Business
Days of demand, pay to the Agent for the Banks an amount equal to that
difference.

 

10.         OPTIONAL CURRENCIES

 

10.1       Selection

 

(a)         A Borrower may select the currency of
a Loan in the relevant Request.

 

(b)         The currency of each Loan must be
Sterling or an Optional Currency.

 

10.2       Revocation of currency

 

If, before
9:30 a.m. on any Rate Fixing Day for a Loan denominated in an Optional
Currency (other than U.S. Dollars or euros), the Agent receives notice from a
Bank that:

 

(a)            it is impracticable for that Bank to
fund its participation in the Loan in the relevant Optional Currency during
that Interest Period in the ordinary course of business in the relevant
interbank market; and/or

 

(b)           the use of the proposed Optional
Currency might contravene any law or regulation,

 

the Agent shall
give notice to the relevant Borrower and to the Banks to that effect before
11:00 a.m. on that day. In this event:

 

(i)             the Borrower and the Banks may agree
that the drawdown will not be made; or

 

(ii)            in the absence of agreement that
Bank’s participation in the Loan (or if more than one Bank is similarly
affected, those Banks’ participations in the Loan) shall be treated as a
separate Loan denominated in Sterling during that Interest Period.

 

10.3       Term Loan - continuing in Optional
Currency

 

(a)         For a Term Loan which is to be
denominated in the same Optional Currency during two successive Interest
Periods, the Agent must calculate the amount of the Term Loan in the Optional
Currency for the second of those Interest Periods.

 

(b)         The amount of the Term Loan in the
Optional Currency for the second Interest Period will be the amount determined
by notionally converting into that Optional Currency the Original Sterling
Amount of the Term Loan on the basis of the Agent’s Spot Rate of Exchange one
Business Day before the Rate Fixing Day for that Interest Period.

 

29

 

(c)         If the amount calculated is less than
the existing amount of the Term Loan in the Optional Currency during the first
Interest Period, the relevant Borrower must pay, subject to paragraph
(e) below, on the last day of the first Interest Period an amount equal to
the difference.

 

(d)         If the amount calculated is more than
the existing amount of the Term Loan in the Optional Currency during the first
Interest Period, each Bank must pay, subject to paragraph (e) below, on
the last day of the first Interest Period its Pro Rata Share of the difference.

 

(e)         If the calculation made by the Agent
under paragraph (a) above shows that the amount of the Term Loan in the
Optional Currency has increased or decreased by less than five per cent. since
it was borrowed or (if later) the most recent adjustment under paragraph
(c) or (d) above, no payment is required under paragraph (c) or
(d) above.

 

10.4       Conditions precedent

 

The obligation of
each Bank under this Clause to make any payment increasing the amount of the
Term Loan in an Optional Currency is subject to the condition precedent that on
the date of the relevant payment under paragraph (d) of Clause 10.3 (Term Loan – continuing in Optional Currency):

 

(a)            the representations in Clause 18 (Representations and warranties) (with the exception of the
representations and warranties in Clauses 18.8(d) (Accounts),
18.9 (Litigation) and Clause 18.16 (Anti-Terrorism Law)) are correct in all material respects;
and

 

(b)           no Default is outstanding or would
result from that payment.

 

11.         AMOUNT OF OPTIONAL
CURRENCIES

 

If a Loan is to be
drawn down in an Optional Currency, the Original Sterling Amount of each Bank’s
participation in that Loan will be determined by converting into Sterling the
Bank’s participation in that Loan on the basis of the applicable Agent’s Spot
Rate of Exchange 3 Business Days before its Drawdown Date. The Agent shall
notify each Bank and each Borrower of the Original Sterling Amount of each Loan
denominated in an Optional Currency and the applicable Agent’s Spot Rate of
Exchange promptly after they are ascertained.

 

12.         PAYMENTS

 

12.1       Place

 

All payments by an
Obligor or a Bank under the Finance Documents shall be made to the Agent to its
account at such office or bank:

 

(a)            in the principal financial centre of
the country of the relevant currency; or

 

(b)           in the case of euros, in the
principal financial centre of a Participating Member State or London,

 

as it may notify to
that Obligor or Bank for this purpose.

 

12.2       Funds

 

Payments under the
Finance Documents to the Agent shall be made for value on the due date in such
funds as the 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.

 

30

 

12.3       Distribution

 

(a)         Each payment received by the Agent
under the Finance Documents for another Party shall, subject to paragraphs
(b) and (c) below, be made available by the Agent to that Party by
payment (on the date and in the currency and funds of receipt) to its account
with such office or bank:

 

(i)             in the principal financial centre of
the country of the relevant currency; or

 

(ii)            in the case of euros, in the
principal financial centre of a Participating Member State or London,

 

as it may notify to
the Agent for this purpose by not less than 5 Business Days’ prior notice or in
the relevant Request.

 

(b)         If the relevant Obligor agrees, the
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
that Obligor under the Finance Documents or in or towards the purchase of any
amount of any currency to be so applied.

 

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

 

12.4       Currency

 

(a)         A repayment or prepayment of a Loan
or any part of a Loan is payable in the currency in which the Loan is
denominated on its due date.

 

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

 

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

 

(d)         Any other amount payable under the
Finance Documents is, except as otherwise provided in this Agreement, payable
in Sterling.

 

12.5       Set-off and counterclaim

 

All payments made
by an Obligor under the Finance Documents shall be made without set-off or
counterclaim.

 

12.6       Non-Business Days

 

(a)         If a payment under the Finance
Documents 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).

 

31

 

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

 

12.7       Partial payments

 

(a)         If the Agent receives a payment
insufficient to discharge all the amounts then due and payable by the Obligors
under the Finance Documents, the Agent shall apply that payment towards the
obligations of the Obligors under the Finance Documents in the following order:

 

(i)             first, in or towards payment pro rata
of any unpaid fees, costs and expenses of the Agent under the Finance
Documents;

 

(ii)            secondly, in or towards payment of
any commitment fee due under Clause 22.3 (Commitment fee)
but unpaid;

 

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

 

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

 

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

 

(b)         The Agent shall, if so directed by
all the Banks, vary the order set out in sub-paragraphs (a)(ii) to
(v) above.

 

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

 

13.         TAXES

 

13.1       Gross-up

 

All payments by an
Obligor under the Finance Documents shall be made without any deduction and
free and clear of and without any deduction for or on account of any Taxes,
except to the extent that the Obligor is required by law to make payment
subject to any Taxes. If any Tax, or amounts in respect of Tax, must be
deducted from any amounts payable or paid by an Obligor, or paid or payable by
the Agent to a Bank, under the Finance Documents, the Obligor shall pay such
additional amounts as may be necessary to ensure that the relevant Bank
receives a net amount equal to the full amount which it would have received had
payment not been made subject to Tax. Notwithstanding the foregoing, no Obligor
shall be required to pay additional amounts under this Clause 13.1 in respect
of such Taxes to the extent they are net income taxes or branch taxes or
franchise taxes imposed in lieu of net income taxes on any Finance Party.

 

13.2       Tax receipts

 

All Taxes required
by law to be deducted by an Obligor from any amounts paid or payable under the
Finance Documents shall be paid by the relevant Obligor when due and the
Obligor shall, as soon as practicable, deliver to the Agent for the relevant
Bank appropriate evidence that the payment has been duly remitted to the
appropriate authority.

 

13.3       Qualifying Banks

 

(a)         Subject to paragraph (b) below,
if a Bank is not or ceases to be a Qualifying Bank in respect of the U.K., no
Obligor will be liable to pay to that Bank under Clause 13.1 (Gross-up), any amount

 

32

 

in respect of taxes
levied or imposed by the U.K. or any taxing authority of or in the U.K. in excess
of the amount it would have been obliged to pay if that Bank had been, or had
not ceased to be, a Qualifying Bank in respect of the U.K.

 

(b)         Paragraph (a) above does not
apply if a Bank ceases to be a Qualifying Bank in respect of the U.K. as a
result of the introduction of, change in, or any change in the interpretation,
administration or application of, any law or regulation or any practice or
concession of the U.K. Inland Revenue occurring after the date of this
Agreement.

 

(c)         Each Bank represents and warrants to
each Obligor that it is a Qualifying Bank in respect of the U.K. on the date of
this Agreement or, in the case of a Bank which becomes a Party after the date
of this Agreement, on the date it becomes a Party. If at any time after the
date of this Agreement any Bank is aware that it is not or will cease to be a
Qualifying Bank in respect of the U.K., it shall promptly notify the Agent and
the Company.

 

(d)         Each U.K. Treaty Bank shall, subject
to paragraph (e) below, deliver to each Borrower incorporated in the U.K.
via the Agent on the date it becomes a Party (and prior to the expiry of any
such form previously provided by that U.K. Treaty Bank), all such forms
required to allow that Borrower to make payments to that U.K. Treaty Bank
without deduction or withholding in respect of any tax imposed by the U.K.

 

(e)         No Bank is obliged to deliver any
form(s) under paragraph (d) above if that Bank is unable to complete the
form(s) in a manner which will enable any Borrower incorporated in the U.K. to make
payments to that Bank without deduction or withholding in respect of taxes
imposed by the U.K as a result of the introduction of or any change in, or in
the interpretation or application by any relevant authority of, any law, treaty
or regulation or any practice, position or concession of the U.K., Inland
Revenue after the date of this Agreement.

 

13.4       U.S. Taxes

 

(a)         Each Obligor agrees that it shall
notify the Agent on or before the date that the Obligor becomes a Party, and at
any time after becoming a Party, if that Obligor is subject to withholding on
payments of interest made to a Bank under U.S. federal income tax law (a “Withholding Obligor” and, after notifying
the Agent, a “Notifying Withholding Obligor”).
An Obligor shall notify the Agent promptly if it becomes a Withholding Obligor
at any time after becoming a Party.

 

(b)         Each Bank that is not a U.S. Person
(a “Non-U.S. Bank”) represents and
warrants to each Withholding Obligor on the latest of the dates that:

 

(i)             the Withholding Obligor becomes a
Party;

 

(ii)            the Withholding Obligor becomes a
Notifying Withholding Obligor; or

 

(iii)           the Bank becomes a Party,

 

that the Bank is a
U.S. Treaty Bank or is otherwise exempt from withholding under U.S. federal
income tax law (a U.S. “Treaty or Exempt Bank”).
Each Non-U.S. Bank agrees that if, at any time after becoming a Party, it
becomes aware that it is ceasing or will cease to be a U.S. Treaty or Exempt
Bank, it shall promptly notify the Agent, and via the Agent, each Notifying
Withholding Obligor.

 

33

 

(c)         Subject to paragraph (d) below,
if a Non-U.S. Bank is not or ceases to be a U.S. Treaty or Exempt Bank, no
Notifying Withholding Obligor will be liable to pay to that Non-U.S. Bank under
Clause 13.1 any amount in respect of taxes levied or imposed by the U.S. or any
taxing authority of or in the U.S. in excess of the amount it would have been
obliged to pay if that Non-U.S. Bank had been, or had not ceased to be, a U.S.
Treaty or Exempt Bank.

 

(d)         Paragraph (c) above does not
apply if a Non-U.S. Bank ceases to be a U.S. Treaty or Exempt Bank as a result
of the introduction of, change in, or any change in the interpretation,
administration or application of, any law, treaty or regulation of any relevant
taxing authority or any practice or concession of the U.S. Internal Revenue
Service after the date of this Agreement.

 

(e)         Each Non-U.S. Bank shall, subject to
paragraph (g) below, deliver via the Agent to the Company and each
Notifying Withholding Obligor on the later of the date that:

 

(i)             the Bank becomes a Party; or

 

(ii)            the Withholding Obligor becomes a
Notifying Withholding Obligor (and prior to the expiry of any such form
previously provided by the Non-U.S. Bank),

 

the appropriate
number of copies of duly executed U.S. Internal Revenue Service Forms W-8BEN
or W-8ECI or any successor or additional forms allowing each Notifying
Withholding Obligor to make payments to that Non-U.S. Bank without deduction or
withholding in respect of federal income taxes imposed by the U.S.

 

(f)          Each Bank that is a U.S. Person (a “U.S. Organised Bank”) shall, subject to
paragraph (g) below, deliver via the Agent to the Company and each
Notifying Withholding Obligor on the later of the two dates provided in
paragraph (e) above (and prior to the expiry of any such form previously
provided by that U.S. Organised Bank) the appropriate number of copies of duly
executed U.S. Internal Revenue Service Forms W-9 or any successor or
additional forms allowing each Notifying Withholding Obligor to make payments
to that Non-U.S. Bank without deduction or withholding in respect of federal
income taxes imposed by the U.S.

 

(g)         No Bank is obliged to deliver any
form(s) under paragraph (e) or (f) above if the Bank is unable to
complete the form(s) in a manner which will enable any Notifying Withholding
Obligor to make payments to that Bank without deduction or withholding in
respect of taxes imposed by the U.S. as a result of the introduction of, change
in, or any change in the interpretation or application by any relevant
authority of, any law, treaty or regulation of any relevant taxing authority or
any practice, position or concession of the U.S. Internal Revenue Service after
the date of this Agreement.

 

13.5       Other tax forms

 

Without prejudice
to Clause 13.3 (Qualifying Banks) or 13.4 (U.S. Taxes) each Finance Party shall co-operate with the
relevant Obligor and the Agent in respect of any application to the relevant
revenue authorities by the completion and execution (as soon as reasonably
practicable following a request from the Obligor or the Agent) of such
certificates, claim forms or other documentation as:

 

34

 

(a)            the Finance Party is reasonably able
to complete and execute without incurring any significant administrative burden
on its part; and

 

(b)           the Obligor or the Agent reasonably
requests for the purpose of enabling the Obligor or the Agent to obtain
authorisation from the relevant revenue authorities to make interest payments in
full without deduction or withholding of Tax.

 

13.6       Reimbursement of Tax Credits

 

(a)         If:

 

(i)             an Obligor pays any additional amount
(a “Tax Payment”) under Clause
13.1 (Gross-up); and

 

(ii)            a Bank effectively obtains a refund
of Tax, or credit against Tax on its overall net income, by reason of that Tax
Payment (a “Tax Credit”); and

 

(iii)           that Bank is able to identify such
Tax Credit as being attributable to the Tax Payment,

 

then the Bank shall
reimburse to the relevant Obligor such proportion of such Tax Credit as will
leave the Bank, after that reimbursement, in no better or worse position than
it would have been in if such Tax Payment had not been required.

 

(b)         Each Bank has an absolute discretion
as to whether to claim any Tax Credit which may be due to it (and, if it does
claim, the extent, order and manner in which it does so) and whether any amount
is due from it under this Clause 13.6. No Bank is obliged to disclose any
information regarding its tax affairs or computations to any Obligor.

 

14.         MARKET DISRUPTION

 

14.1       Absence of quotations

 

If LIBOR or, if
applicable, EURIBOR is to be determined by reference to the Reference Banks but
a Reference Bank does not supply an offered rate by 11:30 a.m. on the
relevant Rate Fixing Day, the applicable LIBOR or EURIBOR shall, subject to
Clause 14.2 (Market disruption), be determined
on the basis of the quotations of the remaining Reference Banks.

 

14.2       Market disruption

 

If:

 

(a)            LIBOR or, if applicable, EURIBOR is
to be determined by reference to the Reference Banks but no, or (following the
appointment of additional Reference Banks pursuant to Clause 28.8 (Reference Banks)) only one, Reference Bank
supplies a rate by 11:30 a.m. on the Rate Fixing Day; or

 

(b)           the Agent receives notification from
Banks whose participations in a Loan exceed 331/3 per
cent. of that Loan that, in their opinion:

 

(i)           matching deposits may not be
available to them in the relevant interbank market in the ordinary course of
business to fund their participations in that Loan for the relevant Interest
Period; or

 

(ii)          the cost to them of matching deposits
in the relevant interbank market would be in excess of the relevant LIBOR or,
if applicable, EURIBOR,

 

35

 

the Agent shall
promptly notify the relevant Borrower and the Banks of the fact and that this
Clause 14 is in operation.

 

14.3       Alternative basis

 

If a notification
under Clause 14.2 (Market disruption)
applies:

 

(a)            in the case of a Loan which has not
been made, and unless the relevant Borrower notifies the Agent to the contrary
before close of business on the day it received the notification under Clause
14.2 (Market disruption), the Loan shall still
be made but it shall be denominated (at the option of the relevant Borrower) in
Sterling or U.S. Dollars (or a combination), it shall have an Interest Period
of one month and the interest payable on that Loan shall be determined in
accordance with this Clause 14.3.

 

(b)           within 5 Business Days of receipt of
the notification for a Loan under Clause 14.2 (Market
disruption), the Company and the Agent shall enter into negotiations
for a period of not more than 30 days with a view to agreeing an alternative
basis for determining the rate of interest and/or funding applicable to that
Loan;

 

(c)            any alternative basis agreed under
paragraph (b) above shall be, with the prior consent of all the Banks,
binding on all the Parties;

 

(d)           if no alternative basis is agreed
each Bank shall (through the Agent) certify on or before 10:00 a.m. on the
last day of the Interest Period (in respect of a Loan in Sterling) or
10:00 a.m. on the 2nd Business Day before the last day of the Interest
Period (in respect of a Loan in an Optional Currency) to which the notification
relates an alternative basis for maintaining its participation in that Loan;

 

(e)            any alternative basis under paragraph
(b) or (d) above may include an alternative method of fixing the
interest rate, alternative Interest Periods or optional currencies but it must
reflect the cost to each Bank of funding its participation in the Loan from
whatever sources it may select plus the applicable Margin plus any applicable
Mandatory Cost;

 

(f)            each alternative basis so certified
shall be binding on the Obligors and each certifying Bank and treated as part of
this Agreement; and

 

(g)           the Agent and the Company shall
consult in good faith following any significant change in market conditions
with a view to returning to the normal provisions of this Agreement.

 

15.         INCREASED COSTS

 

15.1       Increased costs

 

(a)         Subject to Clause 15.2 (Exceptions), the Company shall within 5 Business Days of
demand by a Bank pay to that Bank the amount of any increased cost incurred by
it or its Holding Company as a result of:

 

(i)             the introduction of, or any change
in, or any change in the interpretation or application of any law or
regulation; or

 

(ii)            compliance with any regulation made
after the date of this Agreement,

 

including any law
or regulation relating to taxation or reserve asset, special deposit, cash
ratio, liquidity or capital adequacy requirements or any other form of banking
or monetary control.

 

36

 

(b)         In this Agreement “increased cost” means:

 

(i)             an additional cost incurred by a Bank
or its Holding Company as a result of having entered into, or performing,
maintaining or funding its obligations under, this Agreement; or

 

(ii)            that portion of an additional cost
incurred by a Bank or its Holding Company in making, funding or maintaining all
or any advances comprised in a class of advances formed by or including that
Bank’s participations in the Loans made or to be made under this Agreement as
is attributable to that Bank making, funding or maintaining those
participations; or

 

(iii)           a reduction in any amount payable to
a Bank or its Holding Company or the effective return to a Bank or its Holding
Company under this Agreement or (to the extent that it is attributable to this
Agreement) on its capital.

 

(c)         Each Bank shall notify the Company
promptly upon it becoming aware of any increased cost incurred (or which is
reasonably likely to be incurred) by it or its Holding Company. Any demand
under paragraph (a) above shall be accompanied by a calculation of the
increased cost in reasonable detail. However, a Finance Party is not obliged to
disclose any confidential information.

 

15.2       Exceptions

 

Clause 15 (Increased Costs) does not apply to any increased cost:

 

(a)            intended to be compensated for by the
payment of the Mandatory Cost;

 

(b)           referred to in Clause 13 (Taxes); or

 

(c)            attributable to tax on the overall
net income of a Bank or its Holding Company.

 

15.3       Regulation D Costs

 

Each U.S. Borrower
shall, within 5 Business Days of demand by any Bank (through the Agent), pay to
that Bank the amount of any Regulation D Costs actually incurred by that Bank
in respect of its participation in any Loan made by it to that U.S. Borrower.

 

16.         ILLEGALITY

 

If it is or becomes
unlawful in any jurisdiction for a Bank to give effect to any of its
obligations as contemplated by this Agreement or to fund or maintain its
participation in any Loan, then:

 

(a)            that Bank may notify the Company
through the Agent accordingly; and

 

(b)           if the relevant Borrowers have not
transferred their obligations under the Finance Documents to another Borrower
pursuant to Clause 28.1(b) (Transfers by Obligors)
so that after such transfer that unlawfulness has ceased to exist:

 

(i)           each Borrower shall forthwith or (if
later) on the latest date(s) permitted by the relevant law prepay the
participations of that Bank in all the Loans made to that Borrower; and

 

(ii)          the Commitment of that Bank shall
forthwith or (if later) on the latest date(s) permitted by the relevant law be
cancelled.

 

37

 

17.         GUARANTEE

 

17.1       Guarantee

 

Each Guarantor
irrevocably and unconditionally:

 

(a)            as principal obligor guarantees to
each Finance Party prompt performance by each Borrower of all its payment
obligations under the Finance Documents;

 

(b)           undertakes with each Finance Party
that whenever a Borrower does not pay any amount when due under or in
connection with any Finance Document, that Guarantor shall on demand by the
Agent pay that amount as if that Guarantor instead of the relevant Borrower
were expressed to be the principal obligor; and

 

(c)            indemnifies as primary obligor each
Finance Party on demand against any loss or liability suffered by it if any
obligation guaranteed by that Guarantor is or becomes unenforceable, invalid or
illegal.

 

17.2       Continuing guarantee

 

This guarantee is a
continuing guarantee and will extend to the ultimate balance of all sums
payable by the Borrowers under the Finance Documents, regardless of any
intermediate payment or discharge in whole or in part.

 

17.3       Reinstatement

 

(a)         Where any discharge (whether in
respect of the obligations of any Obligor or any security for those obligations
or otherwise) is made in whole or in part or any arrangement is made on the
faith of any payment, security or other disposition which is avoided or must be
restored on insolvency, liquidation or otherwise without limitation, the
liability of each Guarantor under this Clause 17 shall continue as if the
discharge or arrangement had not occurred.

 

(b)         Each Finance Party may concede or
compromise any claim that any payment, security or other disposition is liable
to avoidance or restoration if it has received legal advice to this effect.

 

17.4       Waiver of defences

 

The obligations of
each Guarantor under this Clause 17 will not be affected by an act, omission,
matter or thing which, but for this provision, would reduce, release or
prejudice any of its obligations under this Clause 17 or prejudice or diminish
those obligations in whole or in part, including (whether or not known to it or
any Finance Party):

 

(a)            any time or waiver granted to, or
composition with, any Obligor or other person;

 

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

 

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

 

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

 

38

 

(e)            any variation (however fundamental)
or replacement of a Finance Document or any other document or security so that
references to that Finance Document in this Clause 17 shall include each
variation or replacement;

 

(f)            any unenforceability, illegality or
invalidity of any obligation of any person under any Finance Document or any
other document or security, to the intent that the Guarantors obligations under
this Clause 17 shall remain in full force and its guarantee be construed
accordingly, as if there were no unenforceability, illegality or invalidity; or

 

(g)           any postponement, discharge,
reduction, non-provability or other similar circumstance affecting any
obligation of any Obligor under a Finance Document resulting from any insolvency,
liquidation or dissolution proceedings or from any law, regulation or order so
that each such obligation shall for the purposes of each Guarantor’s
obligations under this Clause 17 be construed as if there were no such
circumstance.

 

17.5       Immediate recourse

 

(a)         Each Guarantor waives any right it
may have of first requiring any Finance Party (or any trustee or agent on its
behalf) to proceed against or enforce any other rights or security or claim
payment from any person before claiming from that Guarantor under this Clause
17.

 

(b)         Each
Guarantor which is registered or established under the laws of the Bailiwick of
Guernsey irrevocably waives and abandons any right which it has or may at any
time have under the existing or future laws of Guernsey pursuant to the
principle of “droit de discussion” or otherwise, requiring that recourse be had
to the assets of any Obligor or any other person before any action is taken
hereunder against it, and further irrevocably waives and abandons any right it
has or may have at any time under the existing or future laws of Guernsey,
pursuant to the principle of “droit de division” or otherwise, to require that
any Obligor or any other person be made a party to any proceedings or that its
liability be divided or apportioned with any other Obligor or any other person
or reduced in any manner whatsoever.

 

17.6       Appropriations

 

Until all amounts
which may be or become payable by the Borrowers under or in connection with the
Finance Documents have been irrevocably paid in full, each Finance Party (or
any trustee or agent on its behalf) may:

 

(a)            refrain from applying or enforcing
any other moneys, security or rights held or received by that Finance Party (or
any trustee or agent on its behalf) in respect of those amounts, or apply and
enforce the same in such manner and order as it sees fit (whether against those
amounts or otherwise) and no Guarantor shall be entitled to the benefit of the
same; and

 

(b)           hold in a suspense account any moneys
received from a Guarantor or on account of that Guarantor’s liability under
this Clause 17, and interest will accrue on those moneys at the rate payable by
the relevant Borrower on the corresponding amount outstanding under this
Agreement.

 

39

 

17.7       Non-competition

 

Until all amounts
which may be or become payable by the Borrowers under or in connection with the
Finance Documents have been irrevocably paid in full, no Guarantor shall, after
a claim has been made or by virtue of any payment or performance by it under
this Clause 17:

 

(a)            be subrogated to any rights, security
or moneys held, received or receivable by any Finance Party (or any trustee or
agent on its behalf) or be entitled to any right of contribution or indemnity
in respect of any payment made or moneys received on account of that
Guarantor’s liability under this Clause 17;

 

(b)           claim, rank, prove or vote as a
creditor of any Obligor or its estate in competition with any Finance Party (or
any trustee or agent on its behalf); or

 

(c)            receive, claim or have the benefit of
any payment, distribution or security from or on account of any Obligor, or
exercise any right of set-off as against any Obligor,

 

unless the Agent
otherwise directs. Each Guarantor shall hold in trust for and forthwith pay or
transfer to the Agent for the Finance Parties any payment or distribution or
benefit of security received by it contrary to this Clause 17.7 or as directed
by the Agent.

 

17.8       U.S. Guarantors

 

(a)         In this clause:

 

(i)             “fraudulent
transfer law” means any applicable United States bankruptcy or State
fraudulent transfer or conveyance statute and any related case law;

 

(ii)            “U.S.
Guarantor” means any U.S. Obligor that is a Guarantor; and

 

(iii)           terms used in this Clause 17.8 have
the meanings given to them in the United States Bankruptcy Code of 1978 and
applicable fraudulent transfer laws.

 

(b)         Each U.S. Guarantor acknowledges
that:

 

(i)             it will receive valuable direct or
indirect benefits as a result of the transactions financed by the Finance Documents;

 

(ii)            those benefits will constitute
reasonably equivalent value and fair consideration for the purpose of any
fraudulent transfer law; and

 

(iii)           each Finance Party has acted in good
faith in connection with the guarantee given by that U.S. Guarantor and the
transactions contemplated by the Finance Documents.

 

(c)         Each Finance Party agrees that each
U.S. Guarantor’s liability under this Clause is limited so that no obligation
of, or transfer by, any U.S. Guarantor under this Clause is subject to
avoidance and turnover under any fraudulent transfer law.

 

(d)         Each U.S. Guarantor represents and
warrants to the Finance Parties on the date of each Guarantor Accession
Agreement to which that Guarantor is a party that:

 

(i)             the aggregate amount of each U. S.
Guarantor’s debts (including its obligations under the Finance Documents) is
less than the aggregate value (being the lesser of fair valuation and present
fair saleable value) of its assets;

 

(ii)            its capital is not unreasonably small
to carry on its business as it is being conducted;

 

40

 

(iii)           it has not incurred and does not
intend to incur debts beyond its ability to pay as they mature; and

 

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

 

17.9       Release of Guarantors’ right of
contribution

 

If any Guarantor (a
“Retiring Guarantor”) ceases to be
a Guarantor in accordance with the terms of the Finance Documents then on the
date such Retiring Guarantor ceases to be a Guarantor:

 

(a)            that Retiring Guarantor is released
by each other Guarantor from any liability (whether past, present or future and
whether actual or contingent) to make a contribution to any other Guarantor
arising by reason of the performance by any other Guarantor of its obligations
under the Finance Documents; and

 

(b)           each other Guarantor waives any
rights it may have by reason of the performance of its obligations under the
Finance Documents to take the benefit (in whole or in part and whether by way
of subrogation or otherwise) of any rights of the Finance Parties under any
Finance Document or of any other security taken pursuant to, or in connection
with, any Finance Document where such rights or security are granted by or in
relation to the assets of the Retiring Guarantor.

 

17.10     Additional security

 

This guarantee is
in addition to and is not in any way prejudiced by any other security now or
subsequently held by any Finance Party.

 

18.         REPRESENTATIONS AND WARRANTIES

 

18.1       Representations and warranties

 

Each Obligor makes
the representations and warranties set out in this Clause 18 to each Finance
Party. The representations and warranties to be made by the Company will be
made in respect of itself and, where applicable, any other member of the Group.
The representations and warranties to be given by each other Obligor will be
made in respect of itself only.

 

18.2       Status

 

It is a limited
liability company, duly incorporated and validly existing under the laws of its
jurisdiction of incorporation and, where relevant under those laws, in good
standing and has the power to own its assets and carry on its business as it is
being conducted.

 

18.3       Powers and authority

 

It has the
corporate power to enter into and perform its obligations under the Finance
Documents to which it is a party and has taken all necessary corporate action
to authorise the entry into and performance of its obligations under those
Finance Documents.

 

18.4       Legal validity

 

Subject to any
qualifications as to matters of law set out in the legal opinion delivered
under Schedule 2 in respect of that Obligor, this Agreement constitutes,
and each other Finance Document to which it is a party (when executed in accordance
with the terms of this Agreement) will constitute, its legal, valid, binding
and enforceable obligation.

 

41

 

18.5       Non-conflict

 

The entry into and
performance of each Finance Document does not and will not conflict with:

 

(a)            any applicable law or regulation or
any applicable official or judicial order in the jurisdiction of its
incorporation;

 

(b)           its constitutional documents; or

 

(c)            any document to which it is a party
or which is binding upon it or any of its assets.

 

18.6       Authorisations

 

All authorisations
required by it in connection with the entry into, performance, validity and
enforceability of each Finance Document to which it is a party and the
transactions contemplated by each such Finance Document have been obtained or
effected and are in (or will at the relevant time be) full force and effect.

 

18.7       Pari passu

 

Its obligations
under the Finance Documents do and will rank at least pari passu
with all of its other unsecured and unsubordinated obligations other than those
obligations which are mandatorily preferred by law and not by reason of
contract.

 

18.8       Accounts

 

(a)         In the case of the Company, the
audited consolidated accounts of the Group most recently delivered to the
Agent:

 

(i)             have been prepared in accordance with
accounting principles generally accepted in the U.K. as at 31
December 2003 and consistently applied or (if not consistently applied)
are accompanied by details of the inconsistencies; and

 

(ii)            give a true and fair view of the
consolidated financial condition of the Group as at the date to which they were
drawn up.

 

(b)         In the case of each Obligor (other
than the Company) which produces audited accounts, its audited accounts most
recently delivered to the Agent under Clause 19.2(a)(i)(B) (Financial information):

 

(i)             have been prepared in accordance with
accounting principles generally accepted in the U.K. as at 31
December 2003 and consistently applied or (if not consistently applied)
are accompanied by details of the inconsistencies; and

 

(ii)            give a true and fair view of the
financial condition of that Obligor as at the date to which they were drawn up.

 

(c)         In the case of each Obligor which
does not produce audited accounts, the accounts of that Obligor most recently
delivered to the Agent under Clause 19.2(a)(i)(C) (Financial
information) have been prepared in accordance with accounting
principles required in order to consolidate the accounts of that Obligor into
the consolidated accounts of the Company.

 

(d)         There has been no material adverse
change in the consolidated financial condition of the Group since 4
July 2004.

 

42

 

18.9       Litigation

 

No litigation,
arbitration or administrative proceedings has been commenced or, to its
knowledge, is threatened or pending against any member of the Group which,
individually or in the aggregate, could reasonably be expected to have a
Material Adverse Effect.

 

18.10     No default

 

No Event of Default
or (unless this representation is being repeated or deemed to be repeated on
the date of a Request or a Drawdown Date in respect of a Rollover Loan)
Potential Event of Default has occurred and is continuing which has not been
waived.

 

18.11     ERISA

 

(a)         In the case of the Company, each U.S.
Borrower and each U.S. Material Subsidiary, each Pension Plan is in compliance
in all material respects with the applicable provisions of ERISA, the Code and
any other applicable Federal law.

 

(b)         In the case of the Company, each U.S.
Borrower and each U.S. Material Subsidiary, no event or condition has occurred
or exists as a result of which it would be under an obligation to furnish a
report to the Agent in accordance with Clause 19.16 (ERISA).

 

18.12     Investment Company Act

 

In the case of the
Company, each U.S. Borrower and each U.S. Material Subsidiary, neither it nor
any of its Subsidiaries is an “investment company”, or a company “controlled”
by an “investment company”, within the meaning of the Investment Company Act of
1940 of the United States of America.

 

18.13     Public Utility Holding Company Act

 

It is not a holding
company, an affiliate of a holding company or a subsidiary company of a holding
company, or subject to regulation, under the United States Public Utility
Holding Company Act of 1935. In this Clause “holding
company”, “affiliate”
and “subsidiary company” have the
meanings given to them in the United States Public Utility Holding Company Act
of 1935.

 

18.14     Use of Proceeds

 

In the case of the
Company, each U.S. Borrower and each U.S. Material Subsidiary, neither it nor
any of its Subsidiaries is engaged principally, or as one of its important
activities, in the business of extending credit for the purpose, whether
immediate, incidental or ultimate, of buying or carrying Margin Stock, and no
part of the proceeds of the Loans will be used to buy or carry any Margin Stock
in violation of Regulation U or X of the Board of Governors of the Federal
Reserve System. For purposes of this Clause, “Margin
Stock” means “margin stock” within the meaning of Regulations U and
X of the Board of Governors of the Federal Reserve System (or any successor),
as the same may be modified and supplemented and in effect from time to time.
No Obligor may use any part of any Loan to acquire any security in a
transaction that is subject to Section 13 or 14 of the United States
Securities Exchange Act of 1934.

 

18.15     Environmental matters

 

(a)         It and each member of the Group
complies, in all respects, with all requirements of all Environmental Laws
where failure to do so has or could reasonably be expected to have a Material
Adverse Effect; and

 

43

 

(b)         no Environmental Claim is existing
or, to its knowledge pending or threatened against it or any member of the
Group which has or could reasonably be expected to have a Material Adverse
Effect.

 

18.16     Anti-Terrorism Law

 

To the best of its
knowledge, neither the Company nor any member of the Group:

 

(a)            is, or is controlled by, a Restricted
Party;

 

(b)           has received funds or other property
from a Restricted Party; or

 

(c)            is in breach of or is the subject of
any action or investigation under any Anti-Terrorism Law.

 

18.17     Times for making representations and
warranties

 

(a)         The representations and warranties
set out in this Clause 18 (Representations and
Warranties):

 

(i)             in the case of an Obligor which is a
Party on the date of this Agreement, are made by that Obligor on that date; and

 

(ii)            in the case of an Obligor which
becomes a Party after the date of this Agreement, (with the exception of the
representations and warranties in Clauses 18.8(d) (Accounts),
18.9 (Litigation) and Clause 18.16 (Anti-Terrorism Law)) will be deemed to be made by that
Obligor on the date it executes a Borrower Accession Agreement or Guarantor
Accession Agreement, as appropriate; and

 

(b)         (with the exception of the
representations and warranties in Clauses 18.8(d) (Accounts),
18.9 (Litigation), and Clause 18.16 (Anti-Terrorism Law)) are deemed to be repeated by each
Obligor on the date of each Request, each Drawdown Date and the first day of
each Interest Period with reference to the facts and circumstances then
existing.

 

19.         UNDERTAKINGS

 

19.1       Duration

 

The undertakings in
this Clause 19 remain in force from the date of this Agreement for so long as
any amount is or may be outstanding under this Agreement or any Commitment is
in force.

 

19.2       Financial information

 

(a)         The Company shall supply to the Agent
in sufficient copies for all the Banks in respect of the items referred to in
sub-paragraphs (i)(A) and (B), (ii), (iii) and (iv) below and in
sufficient copies for all the Banks in respect of the item referred to in
sub-paragraph (i)(C) below if the Agent so requests:

 

(i)             as soon as practicable:

 

(A)         and in any event within 145 days
after the close of each of its financial years, the audited consolidated
accounts of the Company for that financial year;

 

(B)          and in any event within 180 days
after the close of each of its financial years, in the case of any Obligor
where the jurisdiction in which that Obligor is incorporated requires that
Obligor to produce annual audited accounts, the audited accounts of that
Obligor; or

 

44

 

(C)          and in any event within 180 days
after the close of each of its financial years, in any other case, the accounts
of each Obligor used by the auditors of the Company in preparing the audited
consolidated accounts of the Company,

 

for that year;

 

(ii)            as soon as practicable (and in any
event within 120 days of the end of the first half of each of its financial
years) the unaudited consolidated accounts of the Company for that half year;

 

(iii)           for months ending prior to the
Normalisation Date, as soon as practicable (and in any event within 30 days of
the end of each month) the unaudited consolidated monthly management accounts
of the Company for that month;

 

(iv)          for financial quarters ending prior
to the Normalisation Date, as soon as practicable (and in any event within 45
days of the end of each of the first and third financial quarters in each
financial year) the unaudited consolidated quarterly management accounts of the
Company for the first and third financial quarters in each financial year, such
quarterly management accounts to include a summary and analysis of the monthly
management accounts for that financial quarter prepared by the Reporting
Accountant; and

 

(v)           together with the accounts specified
in sub-paragraphs (i)(A) and (ii) (for the financial half year of the
Group) and, prior to the Normalisation Date, (iv) (for the first and third
financial quarters of the Group) above, a Compliance Certificate signed by two
duly authorised signatories as at the end of the relevant Accounting Period.

 

(b)         Prior to the Normalisation Date,
within seven days of receipt by the Agent of each set of quarterly management
accounts under sub-paragraph (a)(iv) above, each set of audited
consolidated accounts under sub-paragraph (a)(i)(A) above and each set of
unaudited consolidated accounts under sub-paragraph (a)(ii) above the Group
Finance Director will hold a conference call with the Finance Parties to
provide an update on the financial performance of the Group as at the end of
that financial quarter.

 

(c)         From the Normalisation Date, within
seven days of receipt by the Agent of each set of audited consolidated accounts
under sub-paragraph (a)(i)(A) above and each set of unaudited consolidated
accounts under sub-paragraph (a)(ii) above, as applicable the Group
Finance Director will hold a conference call with the Finance Parties to provide
an update on the financial performance of the Group as at the end of that six
month period.

 

19.3       Form of accounts

 

If, at any time,
the Company changes or proposes to change the accounting policies upon which
any of the information provided pursuant Clause 19.2 (a)(i)(A), (ii) and,
for so long as required, (iv) (Financial information)
is prepared, then:

 

(a)            it shall notify the Agent of the
change or proposed change;

 

(b)           within 5 Business Days of receipt of
the notification, it and the Agent shall enter into discussions for a period of
not more than 45 days with a view to agreeing the amendments which would be
required to be made to this Agreement (including, without

 

45

 

limitation, Clause 19.10 (Financial covenants)) to reflect the basis upon which this
Agreement was entered into by it and the Banks;

 

(c)            any agreement between it and the
Agent under sub-paragraph (b) above shall be, with the prior consent of
the Majority Banks, binding on all the Parties; and

 

(d)           if no agreement is reached under
sub-paragraph (b) above, then the Auditor (acting as experts) shall
certify the amendments which would be required to be made to this Agreement to
place the Company and the Banks in the same position they would have been in if
the change had not taken place; a certificate of the Auditor in accordance with
the above will, in the absence of manifest error, be binding on all the
Parties.

 

19.4       Information - miscellaneous

 

(a)         The Company shall supply to the
Agent:

 

(i)             all documents despatched by the
Company to its shareholders generally (or any class of them) or its creditors
generally (or any class of them) at the same time as they are despatched;

 

(ii)            except if prohibited by applicable
law or regulation promptly upon becoming aware of them, details of any
litigation, arbitration or administrative proceedings which are current,
threatened or pending, and which might, if adversely determined, be reasonably
expected to have a Material Adverse Effect; and

 

(iii)           promptly, such further information in
the possession or control of any member of the Group regarding its financial
condition and operations as any Finance Party may reasonably request,

 

in sufficient
copies for all of the Banks, if the Agent so requests.

 

(b)         Upon reasonable notice being given by
the Agent, each member of the Group must allow any one or more representatives
of the Agent and/or accountants or other professional advisers appointed by the
Agent (if a Default is demonstrated to have occurred or to be outstanding, at
the Company’s risk and expense) to have access during normal business hours to
the premises, assets, books and records of that member of the Group.

 

(c)         The Agent may not give notice under
paragraph (b) above more than once every financial year unless it
believes, acting reasonably, that a Default is outstanding or is reasonably
likely to have occurred or may occur.

 

19.5       Notification of Default

 

The Company shall
notify the Agent of any Default (and the steps, if any, being taken to remedy
it) promptly upon becoming aware of its occurrence.

 

19.6       Authorisations

 

(a)         Each Obligor shall obtain and
promptly renew from time to time, and will promptly upon the request of the
Agent furnish certified copies to the Agent of, all such material
authorisations as may be required under any applicable law or regulation to
enable any Obligor to perform its obligations under, or for the validity or
enforceability of, any Finance Document.

 

46

 

(b)         The Company shall ensure that each
member of the Group shall obtain, maintain and comply with the terms of any
authorisation required to enable it to carry on its business where failure to
do so could reasonably be expected to have a Material Adverse Effect.

 

19.7       Pari passu
ranking

 

Each Obligor
undertakes that its obligations under the Finance Documents shall rank at least
pari passu with all of its other present
and future unsecured and unsubordinated obligations other than those
obligations which are mandatorily preferred by law and not by reason of
contract.

 

19.8       Preferred Indebtedness

 

The Company shall
procure that:

 

(a)            Preferred Indebtedness does not at
any time exceed the aggregate of £30,000,000 and the Preferred Indebtedness as
at 31 December 2004 as stated in Schedule 8 (or the equivalent in any
other currency or currencies); and

 

(b)           the Company shall ensure that, if any
derivative transaction is or is to be entered into by a Borrower, then, unless
any applicable law prevents that Borrower becoming a Guarantor, that Borrower
will (unless it is already a Guarantor) become an Additional Guarantor in
accordance with Clause 28.6 (Additional Guarantors).

 

19.9       Disposals

 

(a)         No Obligor shall, and the Company
shall procure that no member of the Group will, either in a single transaction
or in a series of transactions, whether related or not and whether voluntarily
or involuntarily, sell, transfer, lease or otherwise dispose (each a “disposal”) of all or a part of its
respective assets.

 

(b)         Paragraph (a) does not apply to:

 

(i)             disposals of real estate that is not
material to the ordinary course of business of the Group;

 

(ii)            disposals made in the ordinary course
of trade of the disposing entity;

 

(iii)           disposals from a member of the Group
to another member of the Group and where such disposing member is a Guarantor,
the acquiring member shall be or become a Guarantor;

 

(iv)          disposals of cash raised or borrowed
for the purposes for which it was raised or borrowed;

 

(v)           disposals of assets in exchange for
other assets comparable or superior as to type, value and quality;

 

(vi)          disposals of obsolete assets for
cash;

 

(vii)         disposals to trade debtors in
satisfaction of trade debts incurred in the ordinary course of trade of the
disposing entity;

 

(viii)        disposals of cash on arms length
terms provided that any such disposal is not prohibited by this Agreement;

 

47

 

(ix)           a Permitted Reorganisation and its
proceeds; and

 

(x)            from the Normalisation Date, in
addition to (i) to (ix) above, disposals occurring after the
Normalisation Date if, immediately after giving effect to the relevant
disposal, the net proceeds arising from all disposals occurring on and after
the Normalisation Date would not exceed 20 per cent. of the Consolidated Total
Assets in each financial year and the relevant disposal is in the best
interests of the Group and no Default would arise from the disposal.

 

(c)         Nothing in paragraph (b) above
shall permit any member of the Group to dispose of any ownership interests to a
third party in the companies or divisions comprising all or any part of the
Network Product Division or the Systems-Drives Division.

 

19.10     Financial covenants

 

(a)         On any testing date the Company shall
procure that:

 

(i)             in respect of testing dates prior to
the Normalisation Date;

 

(A)         the ratio of Consolidated Net Debt to
Consolidated EBITDA is not, as at any testing date, greater than 2.25:1, and

 

(B)          the ratio of Consolidated EBITA to
Consolidated Net Interest Expense is not, as at any testing date, less than 2.5
to 1.

 

(ii)            in respect of testing dates from the
Normalisation Date:

 

(A)         the ratio of Consolidated Net Debt to
Consolidated EBITDA is not, as at any testing date, greater than 3.00:1, and

 

(B)          the ratio of Consolidated EBITA to
Consolidated Net Interest Expense is not, as at any testing date, less than
3.00 to 1.

 

(b)         The Company shall procure that
Consolidated Net Worth is not at any time less than £100,000,000.

 

(c)

 

(i)             Notwithstanding that the amount of
the terms used in paragraphs (a)-(b) above will be derived from the latest
accounts, all the terms used in paragraphs (a)-(b) above are, subject to
Clause 19.3 (Form of accounts), to be
calculated in accordance with the accounting principles in effect and as
applied by the Company in connection with the accounts produced for the
financial year ending 31 December 2002 save that any charge or credit to
operating profit on the SARS Scheme shall not be taken into account in respect
of Consolidated EBIT, Consolidated EBITA, Consolidated EBITDA and EBIT;

 

(ii)            “testing
date” means:

 

(A)         prior to the Normalisation Date, the
last day of each financial quarter of the Company, being 31 March, 30
June, 30 September and 31 December in each year;

 

(B)          from the Normalisation Date, the last
day of the financial half year and financial year of the Company, being 30
June and 31 December in each year; and

 

48

 

(iii)           if there is a dispute as to any
interpretation of, or computation for, such definitions or terms, the
interpretation or computation of the Auditor notified to the Agent and the
Company prevails in the absence of manifest error; and

 

(iv)          subject to
sub-paragraph (ii) of the definition of Consolidated Net Worth, any
amount denominated in a currency other than Sterling is to be taken into
account at its Sterling equivalent calculated on the basis set out in the then
latest Accounts.

 

19.11     Mergers and Acquisitions

 

(a)         Except as provided below no member of
the Group may enter into any amalgamation, demerger, merger or reconstruction
other than under or in connection with a Permitted Reorganisation.

 

(b)         The Company:

 

(i)             prior to the Normalisation Date,
shall not and shall procure that no member of the Group shall acquire or
subscribe for shares or other ownership interests in or securities of any
company or other person or acquire any business or incorporate any company (an
“acquisition”); and

 

(ii)            from the Normalisation Date, shall
procure that neither it nor any of its Subsidiaries will, without the prior consent
of the Majority Banks purchase or otherwise acquire any assets or (without
limitation to any of the foregoing) acquire any business or interest therein or
agree to do so, which would require the prior approval of the Company’s
shareholders.

 

(c)         Unless an Event of Default is
outstanding (or would result from an acquisition made by any member of the
Group), paragraphs (a) and (b) do not apply to:

 

(i)             acquisitions made in the ordinary
course of trade or under or in connection with a Permitted Reorganisation;

 

(ii)            acquisitions made before the date of
this Agreement in respect of which deferred consideration is payable after the
date of this Agreement and as disclosed to the Banks, provided that:

 

(A)         the terms of the deferred
consideration have been disclosed to the Banks prior to the date of this
Agreement;

 

(B)          other than amendments or waivers
contemplated by the terms of the relevant agreements, no amendments or waivers
are made in respect of that deferred consideration which may increase the
aggregate consideration payable by the Group or may otherwise be on less
favourable terms to the terms disclosed to the Banks; and

 

(C)          if expressly provided for in the
relevant agreement, the deferred consideration shall be satisfied by an issue
of shares in the Company to the Seller;

 

(iii)           an acquisition made in relation to a
disposal made under Clause 19.9(b)(iii) and 19.9(b)(ix) (Disposals); and

 

(iv)          an acquisition, the consideration for
which, when aggregated with the consideration of any other acquisitions made by
a member of the Group in that financial year, does not

 

49

 

cause the aggregate consideration for acquisitions
made by members of the Group to exceed £2,500,000 in any financial year.

 

19.12     Change of business

 

The Company shall
procure that no substantial change is made to the nature of the Group’s
business from that carried on as at the date of this Agreement.

 

19.13     Environmental Laws

 

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

 

19.14     Compliance with laws

 

The Company shall,
and the Company shall procure that each member of the Group will, comply with
and carry out its business in accordance with all laws necessary for the
conduct of its business where any failure to comply or carry out its business
in accordance with that law might have a Material Adverse Effect.

 

19.15     Insurance

 

Each Obligor shall,
and the Company shall procure that each of its Subsidiaries will, insure and
keep insured its assets with underwriters or insurance companies in accordance
with sound business practice and as companies engaged in a similar business in
its jurisdiction would normally insure.

 

19.16     ERISA

 

(a)         As soon as possible, and in any event
within 30 days, after any U.S. Borrower or any other member of the Group knows
or has reason to know that any of the events or conditions mentioned in
paragraph (b) below have occurred or exist, where such event or condition
has or is reasonably likely to have a Material Adverse Effect, it will furnish
to the Agent a statement signed by a senior financial officer of the relevant
company (without personal liability) setting forth the nature of such event or
condition and the action, if any, which the relevant company or an ERISA
Affiliate proposes to take with respect thereto.

 

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

 

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

 

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

 

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

 

(iv)          the institution by PBGC of
proceedings under Section 4042 of ERISA for the termination of, or the
appointment of a trustee to administer, any Pension Plan, or the receipt by any

 

50

 

U.S. Borrower, U.S. Material Subsidiary or any ERISA
Affiliate of a notice that such action has been taken by PBGC with respect to a
Multiemployer Plan;

 

(v)           the complete or partial withdrawal
from a Multiemployer Plan by any U.S. Borrower or any ERISA Affiliate that
results in liability under Section 4201 or 4204 of ERISA or the receipt by
any U.S. Borrower, U.S. Material Subsidiary or any ERISA Affiliate of notice
from a Multiemployer Plan that it is in reorganisation or insolvency pursuant
to Section 4241 or 4245 of ERISA or that it intends to terminate or has
terminated under Section 4041A of ERISA;

 

(vi)          the institution of a proceeding by a
fiduciary of any Multiemployer Plan against any U.S. Borrower, U.S. Material
Subsidiary or any ERISA Affiliate to enforce Section 515 of ERISA, which
proceeding is not dismissed within 30 days;

 

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

 

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

 

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

 

(d)         Each Obligor and its ERISA Affiliates
must be, and remain, in compliance in all material respects with all laws and
regulations relating to each of its Pension Plans.

 

(e)         Each of the Obligors and its ERISA
Affiliates must ensure that no event or condition exists at any time in
relation to a Pension Plan which is reasonably likely to result in the
imposition of a Security Interest on any of its assets pursuant to Title I or
IV of ERISA which would be reasonably likely to have a Material Adverse Effect.

 

19.17     Material Subsidiaries

 

(a)         In each Compliance Certificate
delivered with the accounts referred to in Clauses 19.2(a)(i)(A) and
19.2(a)(ii) (Financial information) (a “Material Subsidiary Compliance Certificate”)
the Company shall designate the Subsidiaries which are to be Material
Subsidiaries from the date of that Material Subsidiary Compliance Certificate
to the date of the next Material Subsidiary Compliance Certificate.

 

(b)         In each Compliance Certificate, the
Company shall list Subsidiaries in descending order of their contribution to
Consolidated EBIT and, where the Consolidated EBIT for two or more Subsidiaries
is the same, list those Subsidiaries in descending order of their contribution
to Consolidated Total Assets.

 

(c)         The Company shall procure that the
list provided in each Compliance Certificate shall be such that, as at the end
of the Accounting Period to which the Compliance Certificate relates, the
aggregate of the EBIT and Total Assets of each Material Subsidiary plus the
EBIT and Total Assets of the Company accounts for at least 80 per cent. of
Consolidated EBIT and 80 per cent. of Consolidated Total Assets. The list shall
set out the proportion which the aggregate EBIT and

 

51

 

Total Assets of the Company and each Material
Subsidiary bears to the Consolidated EBIT and Consolidated Total Assets.

 

(d)         The Company shall procure that each
Initial Guarantor executes a Guarantor Accession Agreement and accedes to this
Agreement as a Guarantor in accordance with Clause 28.6 (Additional
Guarantors) within two months of the date of this Agreement.

 

19.18     Guarantors

 

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

 

19.19     Dividends

 

(a)         Prior to the Normalisation Date,
except as provided below no Obligor shall:

 

(i)             declare, make or pay, or pay interest
on any unpaid amount of, any dividend, charge, fee or other distribution
(whether in cash or in kind) on or in respect of its shares or share capital
(or any class of its share capital); or

 

(ii)            repay or distribute any share premium
account.

 

(b)         From the Normalisation Date, except
as provided below the Company shall not, and the Company shall procure that no
Obligor will:

 

(i)             declare, make or pay, or pay interest
on any unpaid amount of, any dividend, charge, fee or other distribution
(whether in cash or in kind) on or in respect of its shares or share capital
(or any class of its share capital); or

 

(ii)            repay or distribute any share premium
account.

 

except out of Net
Distributable Earnings which accrued on or after 1 January 2003.

 

(c)         Paragraphs (a) and (b) do
not apply to:

 

(i)             any Obligor that is a Non-Wholly
Owned Subsidiary; and

 

(ii)            payments by an Obligor to another
Obligor (including, for the avoidance of doubt, pursuant to a Permitted
Reorganisation).

 

19.20     Negative Pledge

 

(a)         Other than in respect of any Security
Interest already granted in respect of the Financial Indebtedness disclosed in
Schedule 8, the Company shall not and shall procure that no member of the
Group shall create or allow to exist any Security Interest on any of its assets
in favour of a person securing Financial Indebtedness where the principal
amount or the committed amount of the Financial Indebtedness secured is
£50,000,000 or more and that Financial Indebtedness has a scheduled final
maturity date falling on or after 31 March 2006.

 

(b)         Without prejudice to
paragraph (a) above, if any member of the Group intends to create or
permits to subsist any Security Interest on any of its assets contrary to
paragraph (a) above, the Company shall ensure, by no later than the date
upon which that Security Interest is granted, that:

 

(i)             the relevant member of the Group
executes such security and intercreditor documentation as the Agent may require
to ensure that all the obligations under the

 

52

 

Finance Documents shall be secured upon the same
assets, ranking at least pari passu with
the other obligations secured on those assets; or

 

(ii)            at the request of the Company, such
other security and intercreditor documentation in respect of any other assets
of the Group as the Agent shall agree.

 

19.21     Equal Treatment

 

(a)         The Company shall ensure that no
other creditor of an Obligor has the benefit of any guarantee, preference,
financial reporting requirements, representation, warranty, covenant or event
of default (howsoever described) under any document relating to Financial
Indebtedness entered into after the date of this Agreement to which it is a
party unless this Agreement is amended so that the relevant terms of this
Agreement are at least as restrictive and extensive as those other covenants
and/or provisions.

 

(b)         Paragraph (a) above does not
apply to any covenants and/or provisions relating to any Hedging Arrangement.

 

19.22     “Know your customer” checks

 

(a)         If:

 

(i)             the introduction of or any change in
(or in the interpretation, administration or application of) any law or
regulation made after the date of this Agreement;

 

(ii)            any change in the status of an
Obligor after the date of this Agreement; or

 

(iii)           a proposed assignment or transfer by
a Bank of any of its rights and obligations under this Agreement to a party
that is not a Bank prior to such assignment or transfer,

 

obliges the Agent
or any Bank (or, in the case of paragraph (iii) above, any prospective new
Bank) to comply with “know your customer” or similar identification procedures
in circumstances where the necessary information is not already available to
it, each Obligor shall promptly upon the request of the Agent or any Bank
supply, or procure the supply of, such documentation and other evidence as is
reasonably requested by the Agent (for itself or on behalf of any Bank) or any
Bank (for itself or, in the case of the event described in paragraph
(iii) above, on behalf of any prospective new Bank) in order for the Agent,
such Bank or, in the case of the event described in paragraph (iii) above,
any prospective new Bank to carry out and be satisfied it has complied with all
necessary “know your customer” or other similar checks under all applicable
laws and regulations pursuant to the transactions contemplated in the Finance
Documents.

 

(b)         Each Bank shall promptly upon the
request of the Agent supply, or procure the supply of, such documentation and
other evidence as is reasonably requested by the Agent (for itself) in order for
the Agent to carry out and be satisfied it has complied with all necessary
“know your customer” or other similar checks under all applicable laws and
regulations pursuant to the transactions contemplated in the Finance Documents.

 

(c)         The Company shall, by not less than
10 Business Days’ prior written notice to the Agent, notify the Agent (which
shall promptly notify the Banks) of its intention to request that one of its
Subsidiaries becomes an Additional Borrower or Additional Guarantor pursuant to
Clause 28 (Changes to the Parties).

 

53

 

(d)         Following the giving of any notice
pursuant to paragraph (c) above, if the accession of such Additional
Borrower or Additional Guarantor obliges the Agent or any Bank to comply with
“know your customer” or similar identification procedures in circumstances
where the necessary information is not already available to it, the Company
shall promptly upon the request of the Agent or any Bank supply, or procure the
supply of, such documentation and other evidence as is reasonably requested by
the Agent (for itself or on behalf of any Bank) or any Bank (for itself or on
behalf of any prospective new Bank) in order for the Agent or such Bank or any
prospective new Bank to carry out and be satisfied it has complied with the
results of all necessary “know your customer” or other similar checks under all
applicable laws and regulations pursuant to the accession of such Subsidiary to
this Agreement as an Additional Borrower or Additional Guarantor.

 

19.23     Anti-Terrorism Law

 

Neither the Company
nor any member of the Group shall knowingly engage in or conspire to engage in
any transaction that evades or avoids, or has the purpose of evading or
avoiding, or attempts to violate any of the prohibitions set forth in any
Anti-Terrorism Law.

 

20.         DEFAULT

 

20.1       Events of Default

 

Each of the events
set out in this Clause 20 is an Event of Default (whether or not caused by any
reason whatsoever outside the control of any Obligor or any other person).

 

20.2       Non-payment

 

An Obligor does not
pay on the due date any amount payable by it under the Finance Documents at the
place at and in the currency in which it is expressed to be payable and (if
caused solely by technical or administrative error) the non-payment continues
unremedied for 3 Business Days after notice of non-payment is received
from the Agent.

 

20.3       Breach of other obligations

 

(a)         An Obligor fails to comply with any
provision of Clauses 19.8 (Preferred Indebtedness),
19.9 (Disposals), 19.10 (Financial
covenants), 19.11 (Mergers and Acquisitions)
or 19.19 (Dividends).

 

(b)         An Obligor does not comply with any
provision of the Finance Documents (other than those referred to in Clause 20.2
(Non-payment) or paragraph
(a) above) and, if that default is capable of remedy, it is not remedied
within 20 days of the earlier of the relevant Obligor becoming aware of the
default and receipt by it of a notice of default from the Agent.

 

20.4       Misrepresentation

 

A representation or
warranty made or repeated in any Finance Document or in any document delivered
by or on behalf of any Obligor under or in connection with any Finance Document
is incorrect in any material respect when made or deemed to be made or repeated
by reference to the facts and circumstances then subsisting.

 

20.5       Cross-default

 

(a)         Any Financial Indebtedness of a
member of the Group is not paid when due or within any originally applicable
grace period;

 

54

 

(b)         an event of default howsoever
described occurs under any document relating to Financial Indebtedness of a
member of the Group;

 

(c)         any Financial Indebtedness of a
member of the Group becomes prematurely due and payable or is placed on demand
as a result of an event of default (howsoever described) under the document
relating to that Financial Indebtedness;

 

(d)         any commitment for, or underwriting
of, any Financial Indebtedness of a member of the Group is cancelled or
suspended as a result of an event of default (howsoever described) under the
document relating to that Financial Indebtedness; or

 

(e)         any Security Interest securing
Financial Indebtedness over any asset of a member of the Group becomes
enforceable,

 

unless, in any such
case or cases the aggregate amount of all such Financial Indebtedness is less
than the threshold amount (or its equivalent in other currencies). For the
purposes of this Clause 20.5 “threshold
amount” means the lesser of £10,000,000 or U.S.$15,000,000.

 

20.6       Insolvency

 

(a)         An Obligor or a Material Subsidiary
is, or is deemed for the purposes of any law to be, unable to pay its debts as
they fall due or to be insolvent, or admits inability to pay its debts as they
fall due;

 

(b)         an Obligor or a Material Subsidiary
suspends making payments on all or any class of its debts or announces an
intention to do so, or a moratorium is declared in respect of all or any class
of its indebtedness; or

 

(c)         an Obligor or a Material Subsidiary
by reason of financial difficulties, begins negotiations with one or more of
its creditors with a view to the readjustment or rescheduling of all or any
class of its indebtedness.

 

20.7       Insolvency proceedings

 

Except as required
for a Permitted Reorganisation:

 

(a)            any step (including petition,
proposal or convening a meeting) is taken with a view to a moratorium or
composition, assignment or arrangement with any creditors of an Obligor or a
Material Subsidiary;

 

(b)           a meeting of the shareholders,
directors or other officers of an Obligor or a Material Subsidiary is convened
for the purpose of considering any resolution for, to petition for or to file
documents with a court or any registrar for its winding-up or its
administration or dissolution or any such resolution is passed;

 

(c)            any person presents a petition or
files documents with a court or any registrar for the winding-up or for the
administration or dissolution of an Obligor or a Material Subsidiary, and, in
the case of a petition for winding-up presented by a creditor, it is not
withdrawn, discharged or stayed within 30 days;

 

(d)           any order is made for the winding-up,
administration or dissolution of an Obligor or a Material Subsidiary; or

 

55

 

(e)            any other step (including petition,
proposal or convening a meeting) is taken with a view to the rehabilitation,
administration, custodianship, liquidation, winding-up or dissolution of or any
other insolvency proceedings involving an Obligor or a Material Subsidiary,
and, in the case of any such step taken by a creditor, it is not withdrawn,
discharged or stayed within 30 days.

 

20.8       Appointment of receivers and managers

 

(a)         Any liquidator, trustee in
bankruptcy, judicial custodian, compulsory manager, receiver, administrative
receiver, administrator or the like is appointed in respect of an Obligor or a
Material Subsidiary or any part of its assets;

 

(b)         the directors, shareholders or other
officers of an Obligor or a Material Subsidiary request the appointment of a
liquidator, trustee in bankruptcy, judicial custodian, compulsory manager,
receiver, or give notice of their intention to appoint an administrative
receiver, administrator or the like; or

 

(c)         any other step is taken to enforce
any security over any part of the assets of an Obligor or a Material Subsidiary
and is not withdrawn, discharged or stayed within 30 days.

 

20.9       Creditors’ process

 

Any attachment,
sequestration, distress or execution affects any assets of an Obligor or a
Material Subsidiary having an aggregate value of £1,000,000 (or its equivalent
in other currencies) and is not discharged within 30 days.

 

20.10     U.S. Obligor or U.S. Material
Subsidiary insolvency events of default

 

(a)         Any case shall be instituted by or
against any U.S. Obligor or U.S. Material Subsidiary under the United States
Bankruptcy Code of 1978 or any other United States Federal or State bankruptcy
insolvency or similar law for the release of debtors and, in the case of any
such case instituted against it (but not instituted by it), either:

 

(i)             the case shall remain undismissed or
unstayed for a period of 60 days; or

 

(ii)            any of the actions sought in the case
(including, without limitation, the entry of an order for relief against, or
the appointment of a receiver, trustee, custodian or other similar official
for, it or any substantial part of its assets) shall occur; or

 

(b)         any U.S. Obligor or U.S. Material
Subsidiary shall take any corporate action to authorise any of the actions set
out above in this Clause; or

 

(c)         any U.S. Obligor or U.S. Material
Subsidiary is unable to pay its debts generally as they fall due or shall admit
in writing its inability to pay its debts generally, or shall make a general
assignment for the benefit of creditors.

 

20.11     Analogous proceedings

 

There occurs, in
relation to an Obligor or a Material Subsidiary, any event anywhere which, in
the opinion of the Majority Banks, appears to correspond with any of those
mentioned in Clauses 20.6 (Insolvency) to
20.10 (U.S. Obligor or U.S. Material Subsidiary insolvency
events of default) (inclusive).

 

56

 

20.12     Unlawfulness

 

It is or becomes
unlawful for any Obligor to perform any of its obligations under the Finance
Documents.

 

20.13     Cessation of business

 

Any Obligor or
Material Subsidiary ceases to carry on business unless the business is
transferred to any other member of the Group.

 

20.14     Effectiveness of guarantee

 

The guarantee of a
Guarantor is ineffective or is alleged by any Obligor to be ineffective, for
any reason.

 

20.15     Material adverse change

 

Any event or series
of events occurs which, in the reasonable opinion of the Majority Banks, has or
is reasonably likely to have a Material Adverse Effect.

 

20.16     Acceleration

 

On and at any time
after the occurrence of an Event of Default which is continuing the Agent may,
and shall if so directed by the Majority Banks, by notice to the Company:

 

(a)            cancel the Total Commitments;

 

(b)           demand that all or part of the Loans,
together with accrued interest, and all other amounts accrued under this
Agreement be immediately due and payable, whereupon they shall become
immediately due and payable; and/or

 

(c)            demand that all or part of the Loans
be payable on demand, whereupon they shall immediately become payable on demand
by the Agent (acting on the instructions of the Majority Banks).

 

21.         THE AGENT AND THE ARRANGERS

 

21.1       Appointment and duties of the Agent

 

(a)         Each Finance Party (other than the
Agent) irrevocably appoints the Agent to act as its agent under and in
connection with the Finance Documents.

 

(b)         Each Party appointing the Agent
irrevocably authorises the 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 Agent on that Party’s behalf.

 

(c)         The Agent has only those duties which
are expressly specified in the Finance Documents. Those duties are solely of a
mechanical and administrative nature.

 

21.2       Role of the Arrangers

 

Except as
specifically provided in the Finance Documents, no Arranger has any obligations
of any kind to any other Party under or in connection with any Finance
Document.

 

57

 

21.3       Relationship

 

The relationship
between the Agent and the other Finance Parties is that of agent and principal
only. Except as contemplated by the Finance Documents, nothing in this
Agreement constitutes the Agent as trustee or fiduciary for any other Party or
any other person and the Agent need not hold in trust any moneys paid to it for
a Party or be liable to account for interest on those moneys.

 

21.4       Majority Banks’ instructions

 

(a)         The Agent will be fully protected if
it acts in accordance with the instructions of the Majority Banks 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 Banks will be binding on all the Banks. In the absence of such
instructions, the Agent may act as it considers to be in the best interests of
all the Banks.

 

(b)         The Agent is not authorised to act on
behalf of a Bank (without first obtaining that Bank’s consent) in any legal or
arbitration proceedings relating to any Finance Document.

 

21.5       Delegation

 

The Agent may act
under the Finance Documents through its personnel and agents.

 

21.6       Responsibility for documentation

 

Neither the Agent
nor any Arranger is responsible to any other Party for:

 

(a)            the execution, genuineness, validity,
enforceability or sufficiency of any Finance Document or any other document;

 

(b)           the collectability of amounts payable
under any Finance Document; or

 

(c)            the accuracy of any statements
(whether written or oral) made in or in connection with any Finance Document
(including, without limitation, the Information Memorandum).

 

21.7       Default

 

(a)         The Agent is not obliged to monitor
or enquire as to whether or not a Default has occurred. The Agent will not be
deemed to have knowledge of the occurrence of a Default. However, if the 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 Banks.

 

(b)         The 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 those proceedings or takes that action.

 

21.8       Exoneration

 

(a)         Without limiting paragraph
(b) below, the Agent will not be liable to any other Finance Party 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 the Agent in respect of any claim it
might have against the Agent or in respect of any act or omission of any

 

58

 

kind (including
gross negligence or wilful misconduct) by that officer, employee or agent in
relation to any Finance Document.

 

(c)         Nothing in this Agreement shall oblige
the Agent or the Arranger to carry out any “know your customer” or other checks
in relation to any person on behalf of any Bank and each Bank confirms to the
Agent and the Arranger that it is solely responsible for any such checks it is
required to carry out and that it may not rely on any statement in relation to
such checks made by the Agent or the Arranger.

 

21.9       Reliance

 

The 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

 

(c)            engage, pay for and rely on legal or
other professional advisers selected by it (including those in the Agent’s
employment and those representing a Party other than the Agent).

 

21.10     Credit approval and appraisal

 

Without affecting
the responsibility of any Obligor for information supplied by it or on its
behalf in connection with any Finance Document, each Bank 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
the Agent or any Arranger 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.

 

21.11     Information

 

(a)         The Agent shall promptly forward to
the person concerned the original or a copy of any document which is delivered
to the Agent by a Party for that person.

 

(b)         The Agent shall promptly supply a
Bank with a copy of each document received by the Agent under Clauses 4 (Conditions Precedent), 28.5 (Additional
Borrowers) or 28.6 (Additional Guarantors)
upon the request and at the expense of that Bank.

 

(c)         Except where this Agreement
specifically provides otherwise, the Agent is not obliged to review or check
the accuracy or completeness of any document it forwards to another Party.

 

(d)         Except as provided above, the Agent
has no duty:

 

(i)             either initially or on a continuing
basis to provide any Bank 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 before, on or after the date of this
Agreement; or

 

59

 

(ii)            unless specifically requested to do
so by a Bank in accordance with a Finance Document, to request any certificates
or other documents from any Obligor.

 

21.12     The Agent and the Arrangers
individually

 

(a)         If it is also a Bank, the Agent and
each Arranger has the same rights and powers under this Agreement as any other
Bank and may exercise those rights and powers as though it were not the Agent
or an Arranger.

 

(b)         The Agent and each Arranger 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 this Agreement or in relation to any of
the foregoing.

 

(c)         If it is also a Bank, any reference
in the Finance Documents to the Agent means the agency department of the Agent
specifically responsible for acting as Agent under and in connection with the
Finance Documents, as referred to in Clause 34 (Notices). In acting as Agent, the agency department will be
treated as a separate entity from any other department or division of the Bank
concerned. Without limiting the above, the Agent will not be deemed to have
notice of a document, information, fact, matter or thing in the possession or
knowledge of any other department or division of that Bank.

 

(d)         Each Obligor irrevocably authorises
the Agent to disclose to the other Finance Parties any information which, in
the opinion of the Agent, is received by it in its capacity as the Agent.

 

(e)         The Agent may deduct from any amount
received by it for the Banks pro rata any unpaid fees, costs and expenses of
the Agent incurred by it in connection with the Finance Documents.

 

21.13     Indemnities

 

(a)         Without limiting the liability of any
Obligor under the Finance Documents, each Bank shall forthwith on demand
indemnify the Agent for that Bank’s proportion of any liability or loss
incurred by the Agent in any way relating to or arising out of its acting as
the Agent, except to the extent that the liability or loss arises directly from
the Agent’s gross negligence or wilful misconduct.

 

(b)         A Bank’s proportion of the liability
or loss set out in paragraph (a) above will be the proportion which its
participation in the Loans (if any) bears to the Original Sterling Amount of
all the Loans on the date of the demand. However, if there is no Loan
outstanding on the date of demand, then the proportion will be the proportion
which its Commitments bears to the Total Commitments at the date of demand or,
if the Total Commitments have then been cancelled, bore to the Total
Commitments immediately before being cancelled.

 

21.14     Compliance

 

(a)         The Agent may refrain from doing
anything which might, in its opinion, constitute a breach of any law or
regulation or be otherwise actionable at the suit of any person, and may do
anything

 

60

 

which, in its
opinion, is necessary or desirable to comply with any law or regulation of any
jurisdiction.

 

(b)         Without limiting paragraph
(a) above, the Agent need not disclose any information relating to any
Obligor or any of its related entities if the disclosure might, in the opinion
of the Agent, 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.

 

21.15     Resignation of the Agent

 

(a)         Notwithstanding its irrevocable
appointment, the Agent may resign by giving notice to the Banks and the
Company, in which case the Agent may forthwith appoint one of its Affiliates as
successor Agent or, failing that, the Majority Banks may (with the prior
consent of the Company) appoint a successor Agent.

 

(b)         If the appointment of a successor
Agent is to be made by the Majority Banks but they have not, within 30 days
after notice of resignation, appointed a successor Agent which accepts the
appointment, the Agent may (with the prior consent of the Company) appoint a
successor Agent.

 

(c)         The resignation of the Agent and the
appointment of any successor Agent will both become effective only upon the
successor Agent notifying all the Parties that it accepts its appointment. On
giving the notification, the successor Agent will succeed to the position of
the Agent and the term “Agent”
will mean the successor Agent.

 

(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 21 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 Agent, and, subject to paragraph
(d) above, it shall have no further obligations under any Finance
Document.

 

(f)          The Majority Banks may, by notice to
the Agent, require it to resign in accordance with paragraph (a) above. In
this event, the Agent shall resign in accordance with paragraph (a) above
but it shall not be entitled to appoint one of its Affiliates as successor
Agent.

 

21.16     Banks

 

(a)         The Agent may treat each Bank as a
Bank, entitled to payments under this Agreement and as acting through its
Facility Office(s) until it has received not less than 5 Business Days’ prior
notice from that Bank to the contrary.

 

(b)         The Agent may at any time, and shall
if requested to do so by the Company or the Majority Banks, convene a meeting
of the Banks.

 

22.         FEES

 

22.1       Front-end fee

 

Subject to Clause
22.7 (Joint and several liability), the
Borrowers shall pay to the Agent a front-end fee of £75,000 (being point two
five per cent. (0.25%) of the Total Commitments) on the date of the Agreement.

 

61

 

22.2       Agent’s fee

 

Subject to Clause
22.7 (Joint and several liability), the
Borrowers shall pay to the Agent for its own account an agency fee in the
amount and on the dates agreed in the Fee Letter between the Agent and the
Company.

 

22.3       Commitment fee

 

(a)         Subject to Clause 22.7 (Joint and several liability), the Borrowers shall from the
Commencement Date until the last day of the Availability Period pay quarterly
in arrear to the Agent for each Bank a commitment fee computed at the rate of
40 per cent of the applicable Margin (as described by Paragraph (b) below)
on the undrawn, uncancelled amount of that Bank’s Commitment.

 

(b)         On each date on which the Margin is
adjusted under Clause 9.5 (Adjustment of the
Margin), the rate at which the commitment fee payable is computed
shall be adjusted to equal the rate per annum specified opposite the relevant
range set out in the following table in which ratio of Consolidated Net Debt to
Consolidated EBITDA, as shown in the relevant Margin Certificate, falls:

 

	
  Column 1

  	
   

  	
  Column 2

  	
   

  
	
  Ratio of Consolidated
  Net Debt to Consolidated

  EBITDA

  	
   

  	
  Commitment fee (%p.a.)

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Greater than or equal 2.00 to 1

  	
   

  	
  0.70 per
  cent.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Less than 2.00 to 1 but greater than or
  equal to 1.75 to 1

  	
   

  	
  0.60 per
  cent.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Less than 1.75 to 1 but greater than or
  equal to 1.25 to 1

  	
   

  	
  0.50 per
  cent.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Less than 1.25 to 1 but greater than or
  equal to 1 to 1

  	
   

  	
  0.40 per
  cent.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Less than 1 to 1 but greater than or equal
  to 0.75 to 1

  	
   

  	
  0.35 per
  cent.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Less than 0.75 to 1

  	
   

  	
  0.30 per
  cent.

  	
   

  

 

(c)         For the purpose of calculating
commitment fee, Loans are taken at their Original Sterling Amount.

 

(d)         From the Commencement Date, accrued
commitment fee is payable quarterly in arrear, with the first payment being
payable three months after the Commencement Date. Accrued commitment fee shall
also be payable to the Agent for the relevant Bank on the cancelled amount of
its Commitment at the time the cancellation comes into effect. Accrued
commitment fee is payable in Sterling.

 

22.4       Extension fee

 

If the Company
exercises the extension option in accordance with Clause 2.4 (Extension of Final Maturity Date), then it must pay an
extension fee to the Agent for the account of each Bank that has consented to
the Extension Request in the amount and in the manner agreed by the Company and
such Banks at the time the Extension Request is accepted.

 

22.5       Term-Out fee

 

If the Company
exercises the term-out option in accordance with Clause 2.5 (Term-out Option), then it must pay to the Agent for each
Bank a fee in the amount of 0.20 per cent. flat of the aggregate amount of the
Facility converted to a term facility and specified in the Term-out Notice.

 

62

 

22.6       VAT

 

Any fee referred to
in this Clause 22 is exclusive of any value added tax or any other tax which
might be chargeable in connection with that fee. If any value added tax or
other tax is so chargeable, it shall be paid by the Borrowers at the same time
as it pays the relevant fee.

 

22.7       Joint and several liability

 

(a)         The obligations of the Borrowers
under this Clause 22 are joint and several obligations of each Borrower.

 

(b)         The obligations of each Borrower
under this Clause 22 shall not be affected by any release of any Obligor or any
other person under the terms of any composition or arrangement with any
creditor of any Obligor.

 

(c)         Failure of any Borrower to carry out
its obligations under this Clause 22 does not relieve any other Borrower of its
obligations under this Clause 22.

 

23.         EXPENSES

 

23.1       Initial and special costs

 

The Company shall
within 5 Business Days of demand pay the Arrangers the amount of all reasonable
costs and expenses (including legal fees and any applicable value added tax)
incurred by them in connection with:

 

(a)            the negotiation, preparation,
printing and execution of:

 

(i)           this Agreement and any other
documents referred to in this Agreement;

 

(ii)          any other Finance Document (other
than a Novation Certificate) executed after the date of this Agreement; and

 

(iii)         the arrangement of the Facility; and

 

(b)           any amendments, waiver, consent or
suspension of rights (or any proposal for any of the foregoing) requested by or
on behalf of an Obligor or, in the case of Clause 27.2 (Change of
currency) the Agent, and relating to a Finance Document or a
document referred to in a Finance Document.

 

23.2       Enforcement costs

 

The Company shall
forthwith on demand pay to each Finance Party the amount of all costs and
expenses (including legal fees and any applicable value added tax) incurred by
it in connection with the enforcement of, or the preservation of any rights
under, any Finance Document.

 

24.         STAMP DUTIES

 

The Company shall
pay and within 5 Business Days of demand indemnify each Finance Party against
any liability it incurs in respect of any stamp, registration and similar tax
which is or becomes payable in connection with the entry into, performance or
enforcement of any Finance Document (other than the entry into of a Novation Certificate),
including any liability which results from any failure to pay or any delay in
paying such tax.

 

63

 

25.         INDEMNITIES

 

25.1       Currency indemnity

 

(a)         If a Finance Party receives an amount
in respect of an Obligor’s liability under the Finance Documents or if that
liability is converted into a claim, proof, judgment or order in a currency
other than the currency (the “contractual
currency”) in which the amount is expressed to be payable under the
relevant Finance Document:

 

(i)             that Obligor shall indemnify that
Finance Party as an independent obligation against any loss or liability
arising out of or as a result of the conversion;

 

(ii)            if the amount received by that
Finance Party, when converted into the contractual currency at a market rate in
the usual course of its business is less than the amount owed in the
contractual currency, the Obligor concerned shall forthwith on demand pay to
that Finance Party an amount in the contractual currency equal to the deficit;
and

 

(iii)           the Obligor shall forthwith on demand
pay to the Finance Party concerned any exchange costs and taxes payable in
connection with any such conversion.

 

(b)         Each Obligor waives any right it may
have in any jurisdiction to pay any amount under the Finance Documents in a
currency other than that in which it is expressed to be payable.

 

25.2       Other indemnities

 

The Company shall
indemnify each Finance Party against any loss or liability which that Finance
Party incurs as a consequence of:

 

(a)            the occurrence of any Event of
Default;

 

(b)           the operation of Clause 20.16 (Acceleration);

 

(c)            a Loan (or part of a Loan) not being
prepaid in accordance with a notice of prepayment or (other than by reason of
negligence or default by any Finance Party) a Loan not being made after the
Borrower has delivered a Request; or

 

(d)           any payment of principal or an
overdue amount being received from any source otherwise than on the last day of
a relevant Interest Period or Designated Interest Period (as defined in Clause
9.3 (Default interest)) relative
to the amount so received.

 

The Company’s
liability in each case includes any loss (other than loss of margin) or expense
on account of funds borrowed, contracted for or utilised to fund any amount
payable under any Finance Document, any amount repaid or prepaid or any Loan.

 

26.         EVIDENCE AND CALCULATIONS

 

26.1       Accounts

 

Accounts maintained
by a Finance Party in connection with this Agreement are prima facie evidence
of the matters to which they relate.

 

26.2       Certificates and determinations

 

Any certification
or determination by a Finance Party of a rate or amount under the Finance
Documents is prima facie evidence of the matters to which it relates.

 

64

 

26.3       Calculations

 

Interest and the
fee payable under Clause 22.3 (Commitment fee)
accrue from day to day and are calculated on the basis of the actual number of
days elapsed and a year of 365 days, or, in the case of interest payable on an
amount denominated in an Optional Currency or unless market practice otherwise
dictates, 360 days.

 

27.         AMENDMENTS AND WAIVERS

 

27.1       Procedure

 

(a)         Subject to Clause 27.3 (Exceptions), any term of the Finance Documents may be
amended or waived with the agreement of the Company and the Majority Banks. The
Agent may effect, on behalf of any Finance Party, an amendment or waiver
permitted under this Clause.

 

(b)         The Agent shall promptly notify the
other Parties of any amendment or waiver effected under paragraph
(a) above, and any such amendment or waiver shall be binding on all the
Parties.

 

27.2       Change of currency

 

Notwithstanding
Clause 27.1 (Procedure) if a change in any
currency of a country occurs, this Agreement will be amended to the extent the
Agent determines is necessary to reflect the change in currency and to put each
Finance Party in the same position, so far as possible, that it would have been
in if no change in currency had occurred.

 

27.3       Exceptions

 

(a)         An amendment or waiver which relates
to:

 

(i)             the definition of “Majority Banks” in Clause 1.1 (Definitions);

 

(ii)            an extension of the date (including
the Final Maturity Date) for, or a decrease in an amount or (subject to Clause
27.2 (Change of currency)) a
change in the currency of, any payment to that Bank under the Finance Documents
(including the Margin and any fee payable under Clause 22.3 (Commitment fee));

 

(iii)           an increase in a Bank’s Commitment;

 

(iv)          the incorporation of additional
borrowers otherwise than in accordance with Clause 28.5 (Additional
Borrowers);

 

(v)           a term of a Finance Document which
expressly requires the consent of all the Banks; or

 

(vi)          Clause 2.2 (Nature of a
Finance Party’s rights and obligations), Clause 28.2 (Transfers by Banks), Clause 31 (Pro rata
sharing) or this Clause 27,

 

may not be effected
without the agreement of all the Banks.

 

(b)         An amendment or waiver which relates
to the rights and/or obligations of the Agent may not be effected without the
agreement of the Agent.

 

27.4       Waivers and remedies cumulative

 

The rights of each
Party under the Finance Documents:

 

(a)            may be exercised as often as
necessary;

 

(b)           re cumulative and not exclusive of
its rights under the general law; and

 

65

 

(c)            may be waived only in writing and
specifically.

 

Delay in exercising
or non-exercise of any such right is not a waiver of that right.

 

28.         CHANGES TO THE PARTIES

 

28.1       Transfers by Obligors

 

(a)         Subject to paragraph (b) below,
no Obligor may assign, transfer, novate or dispose of any of, or any interest
in, its rights and/or obligations under the Finance Documents.

 

(b)         If no Default is outstanding at that
time, a Borrower (the “Existing Borrower’)
may transfer all or any part of its obligations under the Finance Documents to
any other Borrower (the “New Borrower”)
and the New Borrower may enter into such documentation as the Agent may
reasonably require to effect the transfer.

 

28.2       Transfers by Banks

 

(a)         A Bank (the “Existing
Bank”) may, subject to paragraph (b) below, at any time assign,
transfer or novate any of its Commitments and/or any of its rights and/or
obligations under this Agreement to another Bank or to an Affiliate of the
Existing Bank which is a bank or financial institution and which is a
Qualifying Bank (the “New Bank”). The
prior consent of the Company is required for any other assignment, transfer or
novation unless an Event of Default is outstanding. However, this consent must
not be unreasonably withheld or delayed and will be deemed to have been given
if it is not refused by the Company within 10 Business Days of receipt of a
request for it.

 

(b)

 

(i)             A transfer of part of a Commitment
must be in a minimum amount of at least £2,000,000 (or its equivalent in any
other currency).

 

(ii)            The prior consent of the Company is
required if the New Bank is a U.K. Treaty Bank.

 

(iii)           A Bank will still be treated as a
Qualifying Bank if it takes advantage of Clause 2.4 (Affiliates of Banks) to satisfy the requirements of this
Clause so long as the branch or Affiliate under Clause 2.4 (Affiliates of Banks) is a Qualifying Bank.

 

(c)         A transfer of obligations will be
effective only if either:

 

(i)             the obligations are novated in
accordance with Clause 28.3 (Procedure for novations);
or

 

(ii)            the New Bank confirms to the Agent
and the Company that it undertakes to be bound by the terms of this Agreement
as a Bank in form and substance satisfactory to the Agent. On the transfer
becoming effective in this manner the Existing Bank shall be relieved of its
obligations under this Agreement to the extent that they are transferred to the
New Bank.

 

(d)         Nothing in this Agreement restricts
the ability of a Bank to sub-contract an obligation to a person if that Bank
remains liable under this Agreement for that obligation.

 

(e)         On each occasion an Existing Bank
assigns, transfers or novates any of its Commitments and/or any of its rights
and/or obligations under this Agreement, the New Bank shall, on the date the

 

66

 

assignment,
transfer and/or novation takes effect, pay to the Agent for its own account a
fee of £1,250.

 

(f)          An Existing Bank is not responsible
to a New Bank for:

 

(i)             the execution, genuineness, validity,
enforceability or sufficiency of any Finance Document or any other document;

 

(ii)            the collectability of amounts payable
under any Finance Document; or

 

(iii)           the accuracy of any statements
(whether written or oral) made in or in connection with any Finance Document.

 

(g)         Each New Bank confirms to the
Existing Bank 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 Bank in connection with any Finance Document; and

 

(ii)            will continue to make its own
independent appraisal of the creditworthiness of each Obligor and its related
entities while any amount is or may be outstanding under this Agreement or any
Commitment is in force.

 

(h)         Nothing in any Finance Document
obliges an Existing Bank to:

 

(i)             accept a re-transfer from a New Bank
of any of the rights and/or obligations assigned, transferred or novated under
this Clause; or

 

(ii)            support any losses incurred by the
New Bank by reason of the non-performance by any Borrower of its obligations
under this Agreement or otherwise.

 

(i)          Any reference in this Agreement to a
Bank includes a New Bank but excludes a Bank if no amount is or may be owed to
or by it under this Agreement and its Commitments have been cancelled or
reduced to nil.

 

28.3       Procedure for novations

 

(a)         A novation is effected if the
Existing Bank and the New Bank deliver to the Agent a duly completed
certificate, substantially in the form of Part I of Schedule 5 (a “Novation
Certificate”) and the Agent executes it.

 

(b)         Each Party (other than the Existing
Bank and the New Bank) irrevocably authorises the Agent to execute any duly
completed Novation Certificate on its behalf.

 

(c)         To the extent that they are expressed
to be the subject of the novation in the Novation Certificate:

 

(i)             the Existing Bank and the other
Parties (the “existing Parties”) will be
released from their obligations to each other (the “discharged
obligations”);

 

(ii)            the New Bank 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 Bank instead
of the Existing Bank;

 

67

 

(iii)           the rights of the Existing Bank
against the existing Parties and vice versa (the “discharged
rights”) will be cancelled; and

 

(iv)          the New Bank 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 Bank instead of the
Existing Bank,

 

all on the date of
execution of the Novation Certificate by the Agent or, if later, the date
specified in the Novation Certificate.

 

28.4       Increased costs or changes to the
Facility Office

 

If:

 

(i)             a Bank assigns, transfers or novates
any of its Commitments and/or rights and/or obligations under the Finance
Documents or changes its Facility Office without the prior consent of the
Company; and

 

(ii)            as a result of circumstances existing
at the date the assignment, transfer, novation or change occurs, an Obligor
would be obliged to make a payment to the New Bank or Bank acting through its
new Facility Office under Clause 13 (Taxes) or
Clause 15 (Increased costs) or Clause 16 (Illegality),

 

then,
notwithstanding the provisions of Clause 13 (Taxes),
15 (Increased costs) or 16 (Illegality), the relevant New Bank or Bank acting through
its new Facility Office is only entitled to receive payment under those Clauses
from an Obligor in respect of those circumstances to the same extent as the
relevant Existing Bank or Bank acting through its previous Facility Office
would have been if the assignment, transfer, novation or change had not
occurred.

 

28.5       Additional Borrowers

 

(a)         Subject to compliance with the
provisions of paragraphs (c) and (d) of Clause 19.22 (“Know your customer” checks), if the
Company wishes one of its wholly-owned Subsidiaries to become an Additional
Borrower, then it may, with the prior consent of the Banks (except that no
consent is required in respect of Spirent Holdings Corporation or Spirent
B.V.), deliver to the Agent a Borrower Accession Agreement.

 

(b)         On delivery of a Borrower Accession
Agreement, executed by the relevant Subsidiary and the Company, the Subsidiary
concerned will become an Additional Borrower. However it may not submit a
Request until the Agent confirms to the other Finance Parties that it has
received all the documents listed in Part II of Schedule 2.

 

(c)         Delivery of a Borrower Accession
Agreement, executed by the relevant Subsidiary and the Company, constitutes
confirmation by that Subsidiary and the Company that the representations and
warranties set out in Clause 18 (Representations and
warranties) deemed to be made on that date are correct on the date
of the Borrower Accession Agreement, as if made by them with reference to the
facts and circumstances then existing.

 

(d)         For the purpose of this Clause, a
Subsidiary will be regarded as wholly-owned if a portion of the share capital
is required to be held by law by officers of that Subsidiary.

 

68

 

28.6       Additional Guarantors

 

(a)         If a guarantee is given by any member
of the Group (which is not already an Obligor) in favour of any creditor for
Financial Indebtedness which exceeds an amount of £50,000 (except under the
Finance Documents or any Hedging Arrangement) or if a guarantee is required
under Clause 19.8(b) (Preferred Indebtedness),
then the Company shall promptly following the giving of that guarantee deliver
to the Agent the documents listed in Part III of Schedule 2 in
respect of that member of the Group.

 

(b)         Subject to compliance with the
provisions of paragraphs (c) and (d) of Clause 19.22 (“Know your customer” checks), if the
Company wishes one of its wholly-owned Subsidiaries to become an Additional
Guarantor, then it may (with the prior agreement of the Agent acting on
instructions of the Majority Banks) deliver to the Agent the documents listed
in Part III of Schedule 2.

 

(c)         On delivery of a Guarantor Accession
Agreement, executed by such Subsidiary and the Company, that Subsidiary will
become a Guarantor.

 

(d)         Delivery of such a Guarantor
Accession Agreement shall constitute confirmation by that Subsidiary and the
Company that the representations and warranties set out in Clause 18 (Representations and Warranties) deemed to
be made on that date are correct on the date of the Guarantor Accession
Agreement, as if made by them with reference to the facts and circumstances
then existing.

 

(e)         For the purpose of this Clause, a
Subsidiary will be regarded as wholly-owned if a portion of the share capital
is required to be held by law by officers of that Subsidiary.

 

28.7       Removal of Obligors

 

(a)         At any time any Obligor (other than
the Company) which is not a Material Subsidiary and which is not a guarantor of
other Financial Indebtedness of any member of the Group may by notice to the
Agent (countersigned by two authorised signatories of the Company) request that
it ceases to be an Obligor.

 

(b)         If:

 

(i)             no Default is outstanding at that
time or is likely to result from that Obligor ceasing to be an Obligor; and

 

(ii)            in the case of any Borrower, it has
no outstanding obligations under the Finance Documents (except under Clause 22
(Fees)),

 

that Obligor shall
cease to be an Obligor.

 

28.8       Release of certain Guarantors

 

On the
Normalisation Date, the Agent shall, at the request and cost of the Company,
execute such documents as may be required to release those Guarantors not
listed in Part III of Schedule 9. Each other Finance Party authorises
the Agent to execute any such documents.

 

28.9       Reference Banks

 

If a Reference Bank
(or, if a Reference Bank is not a Bank, the Bank of which it is an Affiliate)
ceases to be a Bank, the Agent shall (in consultation with the Company) appoint
another Bank or an Affiliate of a Bank to replace that Reference Bank.

 

69

 

28.10     Register

 

The Agent shall
keep a register of all the Parties and shall supply any other Party (at that
Party’s expense) with a copy of the register on request.

 

29.         DISCLOSURE OF INFORMATION

 

(a)         A Bank may disclose to one of its
Affiliates or any person with whom it is proposing to enter, or has entered
into, any kind of transfer, participation or other agreement in relation to
this Agreement:

 

(i)             a copy of any Finance Document; and

 

(ii)            any information which that Bank has
acquired under or in connection with any Finance Document,

 

but only if the
recipient of the information has agreed to keep that information confidential
on the terms of paragraph (b) below.

 

(b)         Each Finance Party shall keep
confidential and shall not, without the prior consent of the Company, use any
information (other than information which is publicly available other than as a
result of a breach by that Finance Party of this paragraph(b)) supplied by or
on behalf of any Obligor under or in connection with the Finance Documents
otherwise than in connection with the Finance Documents. However, the
restriction set out in this paragraph (b) shall not apply to, and each
Finance Party shall be entitled to disclose, information:

 

(i)             in connection with any legal
proceedings arising out of or in connection with a Finance Document;

 

(ii)            if required to do so by an order of a
court of competent jurisdiction whether under any procedure for discovering
documents or otherwise;

 

(iii)           pursuant to any law or regulation in
accordance with which that Finance Party is required or accustomed to act;

 

(iv)          to a governmental, banking, taxation
or other regulatory authority of any competent jurisdiction; or

 

(v)           to its accountants or legal or other
professional advisers.

 

30.         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 obligation
(whether or not matured) 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. If either obligation is unliquidated or unascertained,
the Finance Party may set off in an amount estimated by it in good faith to be
the amount of that obligation. Any right to set off under this paragraph is not
intended to constitute a Security Interest.

 

70

 

31.         PRO RATA SHARING

 

31.1       Redistribution

 

If any amount owing
by an Obligor under this Agreement to a Finance Party (the “recovering Finance Party”) is discharged by payment, set-off
or any other manner other than through the Agent in accordance with Clause 12 (Payments) (a “recovery”),
then:

 

(a)            the recovering Finance Party shall,
within 3 Business Days, notify details of the recovery to the Agent;

 

(b)           the Agent shall determine whether the
recovery is in excess of the amount which the recovering Finance Party would have
received had the recovery been received by the Agent and distributed in
accordance with Clause 12 (Payments);

 

(c)            subject to Clause 31.3 (Exceptions), the recovering Finance Party shall within
3 Business Days of demand by the Agent pay to the Agent an amount
(the ”redistribution”) equal to the
excess;

 

(d)           the Agent shall treat the
redistribution as if it were a payment by the Obligor concerned under Clause 12
(Payments) and shall pay the
redistribution to the Finance Parties (other than the recovering Finance Party)
in accordance with Clause 12.7 (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.

 

31.2       Reversal of redistribution

 

If under Clause
31.1 (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 3 Business Days of demand by the recovering Finance Party through
the Agent, reimburse the recovering Finance Party all or the appropriate
portion of the redistribution paid to that Finance Party together with interest
on the amount to be returned to the recovering Finance Party for the period
whilst it held the redistribution. Thereupon, the subrogation in Clause
31.1(e) (Redistribution) will operate in
reverse to the extent of the reimbursement.

 

31.3       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 31.1(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

 

71

 

proceedings, if the
other Finance Party had an opportunity to participate in those legal
proceedings but did not do so or did not take separate legal proceedings.

 

32.         SEVERABILITY

 

If a provision of
any Finance Document is or becomes illegal, invalid or unenforceable in any
jurisdiction, that shall not affect:

 

(a)            the validity or enforceability in
that jurisdiction of any other provision of the Finance Documents; or

 

(b)           the validity or enforceability in
other jurisdictions of that or any other provision of the Finance Documents.

 

33.         COUNTERPARTS

 

Each Finance
Document may be executed in any number of counterparts, and this has the same
effect as if the signatures on the counterparts were on a single copy of the
Finance Document.

 

34.         NOTICES

 

34.1       Giving of notices

 

All notices or
other communications under or in connection with this Agreement shall be given
in writing and, unless otherwise stated, may be made by letter 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, 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. Any notice to the Agent by facsimile must be
confirmed in writing, but failure to so confirm in writing will not prejudice
the validity of the notice by facsimile.

 

34.2       Addresses for notices

 

(a)         The address and facsimile number of
each Party (other than the Company and the Agent) for all notices under or in
connection with the Finance Documents are:

 

(i)             those notified by that Party for this
purpose to the Agent on or before the date it becomes a Party; or

 

(ii)            any other notified by that Party for
this purpose to the Agent by not less than 5 Business Days’ notice.

 

(b)         The address and facsimile number of
the Company are:

 

Spirent House

Crawley Business Quarter

Fleming Way

Crawley

West Sussex

RH10 9QL

 

72

 

 

	
  Facsimile no:

  	
   

  	
  01293 767944

  
	
   

  	
   

  	
   

  
	
  For the attention of:

  	
   

  	
  Group Treasurer

  
	
   

  	
   

  	
   

  
	
  or (for all notices in respect of a Default):

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Facsimile no:

  	
   

  	
  01293 767929

  
	
   

  	
   

  	
   

  
	
  For the attention of:

  	
   

  	
  Company Secretary

  

 

or such other as
the Company may notify to the Agent by not less than 5 Business Days’ notice.

 

(c)         The address and facsimile number of
the Agent are:

 

Bank House

1 Wine Street

Bristol

BS1 2AN

 

	
  Facsimile no:

  	
   

  	
  0117 923 3367

  
	
   

  	
   

  	
   

  
	
  For the attention of:

  	
   

  	
  Loans Administration Department

  

 

or such other as
the Agent may notify to the other Parties by not less than 5 Business Days’
notice.

 

(d)         All notices from or to an Obligor
shall be sent through the Agent.

 

(e)         The Agent shall, promptly upon
request from any Party, give to that Party the address or facsimile number of
any other Party applicable at the time for the purposes of this Clause.

 

(f)          Each Obligor (other than the Company)
irrevocably appoints the Company to act as its agent for the purpose of
executing, giving and receiving any document (including a Finance Document),
notice or other communication in connection with this Agreement.

 

35.         LANGUAGE

 

(a)         Any notice given under or in
connection with any Finance Document shall be in English.

 

(b)         All other documents provided under or
in connection with any Finance Document shall be:

 

(i)             in English; or

 

(ii)            if not in English, accompanied by a
certified English translation and, in this case, the English translation shall
prevail unless the document is a statutory or other official document.

 

36.         JURISDICTION

 

36.1       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 and
accordingly submits to the jurisdiction of the English courts.

 

73

 

36.2       Service of process

 

(a)         Without prejudice to any other mode
of service, each Obligor (other than an Obligor incorporated in England and
Wales):

 

(i)             irrevocably appoints the Company as
its agent for service of process in relation to any proceedings before the
English courts in connection with any Finance Document;

 

(ii)            agrees that failure by a process
agent to notify the relevant Obligor of the process will not invalidate the
proceedings concerned; and

 

(iii)           consents to the service of process
relating to any such proceedings by prepaid posting of a copy of the process to
its address for the time being applying under Clause 34.2 (Addresses for notices).

 

36.3       Forum convenience and enforcement
abroad

 

Each Obligor:

 

(a)            waives objection to the English and
New York State and Federal 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 or New York State or Federal 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.

 

36.4       Non-exclusivity

 

Nothing in this
Clause 36 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.

 

37.         GOVERNING LAW

 

This Agreement is
governed by English law.

 

38.         WAIVER OF JURY TRIAL

 

THE OBLIGORS AND
THE FINANCE PARTIES WAIVE ANY RIGHTS THEY MAY HAVE TO A JURY TRIAL OF ANY
CLAIM OR CAUSE OF ACTION BASED ON OR ARISING FROM ANY FINANCE DOCUMENT OR THE
TRANSACTIONS CONTEMPLATED BY THE FINANCE DOCUMENTS. In the event of litigation,
this Agreement may be filed as a written consent to a trial by the court.

 

THIS AGREEMENT has
been entered into on the date stated at the beginning of this Agreement.

 

74

 

SCHEDULE 1

 

ORIGINAL PARTIES

 

	
  Banks

  	
   

  	
  Commitments

  	
   

  
	
  COMMERZBANK AG, London Branch

  	
   

  	
  £

  	
  7,500,000

  	
   

  
	
  HSBC BANK plc

  	
   

  	
  £

  	
  7,500,000

  	
   

  
	
  JPMORGAN CHASE BANK, N.A.

  	
   

  	
  £

  	
  2,500,000

  	
   

  
	
  LLOYDS TSB BANK plc

  	
   

  	
  £

  	
  7,500,000

  	
   

  
	
  THE ROYAL BANK OF SCOTLAND plc

  	
   

  	
  £

  	
  5,000,000

  	
   

  
	
  Total Commitments

  	
   

  	
  £

  	
  30,000,000

  	
   

  

 

75

 

SCHEDULE 2

 

CONDITIONS PRECEDENT DOCUMENTS

 

PART I

 

TO BE DELIVERED PRIOR TO DELIVERY OF FIRST REQUEST

 

Company

 

1.           A copy of the constitutional
documents of the Company or a certificate confirming that there has been no
change since they were last given to the Agent under the Existing Facility.

 

2.           A copy of a resolution of the board
of directors of the Company and the requisite Board Committee approving the
terms of, and the transactions contemplated by, this Agreement.

 

3.           A specimen of the signature of each
person authorised on behalf of the Company to execute or witness the execution
of any Finance Document or to sign or send any Request, Selection Notice or any
other document or notice in connection with any Finance Document.

 

4.           A certificate of an authorised
signatory of the Company certifying that each copy document specified in
Part I of this Schedule is correct, complete and in full force and
effect as at a date no earlier than the date of this Agreement.

 

5.           A legal opinion of Allen &
Overy LLP, legal advisers in England to the Arrangers addressed to the
Arrangers and the Agent.

 

Each Initial Guarantor

 

6.           A Guarantor Accession Agreement, duly
executed as a deed (where applicable) by the Initial Guarantor and the Company.

 

7.           A copy of the constitutional documents
of the Initial Guarantor or a certificate confirming that there has been no
change since they were last given to the Agent under the Existing Facility.

 

8.           A copy of a resolution of the board
of directors of the Initial Guarantor:

 

(a)            approving the terms of, and the
transactions contemplated by, the Guarantor Accession Agreement and resolving
that it execute the Guarantor Accession Agreement;

 

(b)           authorising a specified person or
persons to execute the Guarantor Accession Agreement on its behalf; and

 

(c)            authorising a specified person or
persons, on its behalf to sign and/or despatch all other documents and notices
to be signed and/or despatched by it under or in connection with the Agreement.

 

9.           If lawyers in the jurisdiction of the
Initial Guarantor have advised the Agent to obtain such a resolution, a copy of
a resolution, signed by all the holders of the issued or allotted shares in the
Initial Guarantor, approving the terms of, and the transactions contemplated
by, the Guarantor Accession Agreement.

 

10.         A certificate of an authorised
signatory of the Initial Guarantor confirming that the execution by the Initial
Guarantor of each Finance Document to which it is a party and the performance
by it of its obligations under each such Finance Document are within its
corporate powers and have been duly approved by all necessary corporate action.

 

76

 

11.         A specimen of the signature of each
person authorised by the resolutions referred to in paragraph 3 above.

 

12.         The latest accounts (audited if
produced) of the Initial Guarantor unless already given under Clause 19.2 (Financial Information) of the Existing Facility.

 

13.         A certificate of an authorised
signatory of the Initial Guarantor certifying that each copy document specified
in this Part I of Schedule 2 is correct, complete and in full force
and effect as at a date no earlier than the date of the Guarantor Accession
Agreement.

 

14.         If applicable, a copy of all
resolutions, written decisions, declarations, certificates of incorporation and
re-registration and other documents required to ensure compliance with Sections
151 to 158 of the Companies Act 1985 including an auditor’s report from an
auditor acceptable to the Agent, addressed to the Company and the Finance
Parties, together with a letter from the Company confirming that it will
register the relevant documents at Companies House.

 

15.         A legal opinion of Allen &
Overy LLP or lawyers, acceptable to the Agent, in the jurisdiction of
incorporation of the Initial Guarantor addressed to the Finance Parties.

 

Other documents and evidence

 

16.         Evidence that all fees and expenses
then due and payable from the Company under this Agreement have been or will be
paid by the first Drawdown Date.

 

17.         A copy of any other authorisation or
other document, opinion or assurance which the Agent has notified the Company
is necessary in connection with the entry into and performance of, and the
transactions contemplated by, any Finance Document or for the validity and
enforceability of any Finance Document.

 

77

 

PART II

 

TO BE DELIVERED BY AN ADDITIONAL BORROWER

 

1.           A Borrower Accession Agreement, duly
executed by the Additional Borrower and the Company.

 

2.           A copy of the constitutional
documents of the Additional Borrower.

 

3.           If the Additional Borrower is
incorporated in the U.S., a Certificate of Good Standing from the Secretary of
State of the state of incorporation of that Additional Borrower dated not more
than 5 Business Days prior to the date of the relevant Borrower Accession
Agreement.

 

4.           A copy of a resolution of the board
of directors of the Additional Borrower:

 

(a)            approving the terms of, and the
transactions contemplated by, the Borrower Accession Agreement and resolving
that it execute the Borrower Accession Agreement;

 

(b)           authorising a specified person or
persons to execute the Borrower Accession Agreement on its behalf; and

 

(c)            authorising a specified person or
persons, on its behalf, to sign and/or despatch all other documents and notices
(including Requests) to be signed and/or despatched by it under or in
connection with this Agreement.

 

5.           A certificate of an authorised
signatory of the Additional Borrower confirming that the execution by the
Additional Borrower of each Finance Document to which it is a party and the
performance by it of its obligations under each such Finance Document are
within its corporate powers and have been duly approved by all necessary
corporate action.

 

6.           A specimen of the signature of each
person authorised by the resolution referred to in paragraph 4 above.

 

7.           The latest accounts (audited if
produced) of the Additional Borrower.

 

8.           A certificate of an authorised
signatory of the Additional Borrower certifying that each copy document
specified in Part II of this Schedule 2 is correct, complete and in
full force and effect as at a date no earlier than the date of the Borrower
Accession Agreement.

 

9.           A legal opinion of each of
Allen & Overy LLP or lawyers acceptable to the Agent in the
jurisdiction of incorporation of the Additional Borrower, addressed to the
Finance Parties.

 

10.         A copy of any other authorisation or
other document, opinion or assurance which the Agent considers to be necessary
in connection with the entry into and performance of, and the transactions
contemplated by, the Borrower Accession Agreement or for the validity and
enforceability of any Finance Document.

 

78

 

PART III

 

TO BE DELIVERED BY AN ADDITIONAL GUARANTOR

 

1.           A Guarantor Accession Agreement, duly
executed as a deed by the Additional Guarantor and the Company.

 

2.           A copy of the constitutional
documents of the Additional Guarantor.

 

3.           A copy of a resolution of the board
of directors of the Additional Guarantor:

 

(a)            approving the terms of, and the
transactions contemplated by, the Guarantor Accession Agreement and resolving
that it execute the Guarantor Accession Agreement;

 

(b)           authorising a specified person or
persons to execute the Guarantor Accession Agreement on its behalf; and

 

(c)            authorising a specified person or
persons, on its behalf to sign and/or despatch all other documents and notices
to be signed and/or despatched by it under or in connection with the Agreement.

 

4.           If lawyers in the jurisdiction of the
Additional Guarantor have advised the Agent to obtain such a resolution, a copy
of a resolution, signed by all the holders of the issued or allotted shares in
the Additional Guarantor, approving the terms of, and the transactions contemplated
by, the Guarantor Accession Agreement.

 

5.           A certificate of an authorised
signatory of the Additional Guarantor confirming that the execution by the
Additional Guarantor of each Finance Document to which it is a party and the
performance by it of its obligations under each such Finance Document are
within its corporate powers and have been duly approved by all necessary
corporate action.

 

6.           A specimen of the signature of each
person authorised by the resolutions referred to in paragraph 3 above.

 

7.           The latest accounts (audited if
produced) of the Additional Guarantor.

 

8.           A certificate of an authorised
signatory of the Additional Guarantor certifying that each copy document
specified in this Part III of Schedule 2 is correct, complete and in
full force and effect as at a date no earlier than the date of the Guarantor
Accession Agreement.

 

9.           If applicable, a copy of all
resolutions, written decisions, declarations, certificates of incorporation and
re-registration and other documents required to ensure compliance with Sections
151 to 158 of the Companies Act 1985 including an auditor’s report from an
auditor acceptable to the Agent, addressed to the Company and the Finance
Parties, together with a letter from the Company confirming that it will register
the relevant documents at Companies House.

 

10.         A legal opinion of Allen &
Overy LLP or lawyers, acceptable to the Agent, in the jurisdiction of
incorporation of the Additional Guarantor addressed to the Finance Parties.

 

11.         A copy of any other authorisation or
other document, opinion or assurance which the Agent considers to be necessary
in connection with the entry into and performance of, and the transactions
contemplated by, the Guarantor Accession Agreement or for the validity and
enforceability of any Finance Document.

 

79

 

SCHEDULE 3

 

CALCULATION OF THE MANDATORY COST

 

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

 

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

 

3.           The Additional Cost Rate for any Bank
lending from a Facility Office in a Participating Member State will be the
percentage notified by that Bank to the Agent. This percentage will be
certified by that Bank in its notice to the Agent to be its reasonable
determination of the cost (expressed as a percentage of that Bank’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 Bank
lending from a Facility Office in the United Kingdom will be calculated by the
Agent as follows:

 

(a)            in relation to a
sterling Loan:

 

	
  

  	
  per cent. per
  annum

  	
   

  

 

(b)           in relation to a
Loan in any currency other than sterling:

 

	
  

  	
  per cent. per
  annum

  	
   

  

 

Where:

 

A               is the percentage of Eligible Liabilities
(assuming these to be in excess of any stated minimum) which that Bank is from
time to time required to maintain as an interest free cash ratio deposit with
the Bank of England to comply with cash ratio requirements.

 

B               is the percentage rate of interest
(excluding the Margin and the Mandatory Cost and, if the Loan is an Unpaid Sum,
the additional rate of interest specified in paragraph (a) of Clause 9.3
(Default interest)) payable for the relevant Interest Period on the Loan.

 

C               is the percentage (if any) of
Eligible Liabilities which that Bank is required from time to time to maintain
as interest bearing Special Deposits with the Bank of England.

 

D               is the percentage rate per annum
payable by the Bank of England to the Agent on interest bearing Special
Deposits.

 

80

 

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

 

5.           For the purposes of this Schedule:

 

(a)            “Eligible Liabilities” and “Special Deposits” have the meanings given
to them from time to time under or pursuant to the Bank of England Act 1998 or
(as may be appropriate) by the Bank of England;

 

(b)           “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;

 

(c)            “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);

 

(d)           “Tariff Base” has the meaning given to it
in, and will be calculated in accordance with, the Fees Rules; and

 

(e)            “Unpaid Sum” means any sum due and payable
but unpaid by an Obligor under the Finance Documents.

 

6.           In application of the above formulae,
A, B, C and D will be included in the formulae as percentages (i.e. 5 per cent.
will be included in the formula as 5 and not as 0.05).  A negative result obtained by subtracting D
from B shall be taken as zero.  The
resulting figures shall be rounded to four decimal places.

 

7.           If requested by the Agent, each
Reference Bank shall, as soon as practicable after publication by the Financial
Services Authority, supply to the Agent, the rate of charge payable by that
Reference Bank to the Financial Services Authority pursuant to the Fees
Rules in respect of the relevant financial year of the Financial Services
Authority (calculated for this purpose by that Reference Bank as being the
average of the Fee Tariffs applicable to that Reference Bank for that financial
year) and expressed in pounds per £1,000,000 of the Tariff Base of that
Reference Bank.

 

8.           Each Bank shall supply any
information required by the Agent for the purpose of calculating its Additional
Cost Rate.  In particular, but without
limitation, each Bank shall supply the following information on or prior to the
date on which it becomes a Bank:

 

(a)            the jurisdiction of
its Facility Office; and

 

(b)           any other
information that the Agent may reasonably require for such purpose.

 

Each Bank shall
promptly notify the Agent of any change to the information provided by it
pursuant to this paragraph.

 

9.           The percentages of each Bank for the
purpose of A and C above and the rates of charge of each Reference Bank for the
purpose of E above shall be determined by the Agent based upon the information
supplied to it pursuant to paragraphs 7 and 8 above and on the assumption that,

 

81

 

unless
a Bank notifies the Agent to the contrary, each Bank’s obligations in relation
to cash ratio deposits and Special Deposits are the same as those of a typical
bank from its jurisdiction of incorporation with a Facility Office in the same
jurisdiction as its Facility Office.

 

10.         The Agent shall have no liability to
any person if such determination results in an Additional Cost Rate which over
or under compensates any Bank and shall be entitled to assume that the
information provided by any Bank or Reference Bank pursuant to paragraphs 3, 7
and 8 above is true and correct in all respects.

 

11.         The Agent shall distribute the
additional amounts received as a result of the Mandatory Cost to the Banks on
the basis of the Additional Cost Rate for each Bank based on the information
provided by each Bank and each Reference Bank pursuant to paragraphs 3, 7 and 8
above.

 

12.         Any determination by the Agent
pursuant to this Schedule in relation to a formula, the Mandatory Cost, an
Additional Cost Rate or any amount payable to a Bank shall, in the absence of
manifest error, be conclusive and binding on all Parties.

 

13.         The Agent may from time to time,
after consultation with the Company and the Banks, 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.

 

82

 

SCHEDULE 4

 

FORM OF NOTICES

 

PART I

 

FORM OF REQUEST

 

(BY
LETTER OR BY FAX)

 

	
  To:

  	
   

  	
  LLOYDS TSB BANK plc as Agent

  
	
   

  	
   

  	
   

  
	
  From:

  	
   

  	
  [BORROWER]

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Date:

  	
   

  	
  [                   ]

  

 

SPIRENT
plc - £30,000,000

Credit
Agreement dated [•] February 2005

 

1.           We wish to utilise the Facility by
way of a Revolving Credit Loan as follows:

 

(a)            Drawdown Date: [                   ](1)

 

(b)           Amount and currency:  [                   ](2)

 

(c)            Interest Period: [                   ](3).

 

2.           We confirm that each condition
specified in Clause 4.2 (Further conditions
precedent) is satisfied on the date of this Request.

 

 

	
  By:

  
	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  [BORROWER]

  

 

(1)  To be completed in accordance with Clause
5.2 (Completion of Requests).

(2)  To be completed in accordance with Clause
5.2 (Completion of Requests).

(3)  To be completed in accordance with Clause
5.2 (Completion of Requests).

 

83

 

PART II

 

FORM OF SELECTION NOTICE

 

(BY
LETTER OR BY FAX)

 

	
  To:

  	
   

  	
  LLOYDS TSB BANK plc as Agent

  
	
   

  	
   

  	
   

  
	
  From:

  	
   

  	
  [BORROWER]

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Date:

  	
   

  	
  [                   ]

  

 

SPIRENT
plc - £30,000,000

Credit Agreement dated [•] February 2005

 

1.           We refer to the Agreement. This is a
Selection Notice. Terms defined in the Agreement have the same meaning in this
Selection Notice unless given a different meaning in this Selection Notice.

 

2.           We refer to the following Loan with
an Interest Period ending on
[                   ]*.

 

3.           We request that the next Interest
Period for the above Loan is
[                   ].

 

4.           This Selection Notice is irrevocable.

 

 

	
  By:

  
	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  [BORROWER]

  

 

*  Insert details of all Loans which have an
Interest Period ending on the same date.

 

84

 

SCHEDULE 5

 

FORMS OF ACCESSION DOCUMENTS

 

PART I

 

NOVATION CERTIFICATE

 

	
  To:

  	
   

  	
  LLOYDS TSB BANK plc as Agent

  
	
   

  	
   

  	
   

  
	
  From:

  	
   

  	
  [THE EXISTING BANK] and [THE NEW BANK]

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Date:

  	
   

  	
  [                   ]

  

 

SPIRENT
plc - £30,000,000

Credit Agreement dated [•] February 2005

 

We refer to Clause
28.3 (Procedure for novations).

 

1.           We
[                   ]
(the “Existing Bank”) and
[                   ]
(the “New Bank”) agree to the Existing Bank
and the New Bank novating all or part of the Existing Bank’s Commitments,
rights and obligations referred to in the Schedule in accordance with
Clause 28.3 (Procedure for novations).

 

2.           The specified date for the purposes
of Clause 28.3(c) (Procedure for novations)
is [date of novation].

 

3.           The Facility Office and address for
notices of the New Bank for the purposes of Clause 34.2 (Addresses
for notices) are set out in the Schedule.

 

4.           This Novation Certificate is governed
by English law.

 

THE SCHEDULE

 

Commitments/rights
and obligations to be novated

 

[insert relevant
details].

 

	
  [Existing Bank]

  	
   

  	
  [New Bank]

  
	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
  By:

  
	
   

  	
   

  	
   

  
	
  Date:

  	
   

  	
  Date:

  

 

 

	
  [New Bank]

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  [Facility Office

  	
   

  	
  Address for notices]

  
	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Date:

  	
   

  	
   

  

 

85

 

PART II

 

BORROWER ACCESSION AGREEMENT

 

	
  To:

  	
   

  	
  LLOYDS TSB BANK plc as Agent

  
	
   

  	
   

  	
   

  
	
  From:

  	
   

  	
  [PROPOSED BORROWER] and SPIRENT plc

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Date:

  	
   

  	
  [                   ]

  

 

SPIRENT
plc - £30,000,000

Credit Agreement dated [•] February 2005
(the “Credit Agreement”)

 

We refer to Clause
28.5 (Additional Borrowers).

 

We, [name of
proposed borrower] of [Registered Office] (Registered no.
[                   ]),
agree to become an Additional Borrower and to be bound by the terms of the
Credit Agreement as an Additional Borrower in accordance with Clause 28.5 (Additional Borrowers).

 

Our address for
notices for the purposes of Clause 34.2 (Addresses for notices)
is:
[                   ]

 

We, [name of
proposed borrower] and Spirent plc, confirm that the representations and
warranties set out in Clause 18 (Representations and
Warranties) deemed to be made on the date of this Agreement are
correct on the date of this Agreement.

 

This Agreement is
governed by English law.

 

By:

 

 

[PROPOSED BORROWER]

 

Authorised
Signatory

 

 

	
  By:

  
	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  SPIRENT plc

  

 

86

 

PART III

 

GUARANTOR ACCESSION AGREEMENT

 

	
  To:

  	
   

  	
  LLOYDS TSB BANK plc as Agent

  
	
   

  	
   

  	
   

  
	
  From:

  	
   

  	
  [PROPOSED GUARANTOR] and SPIRENT plc

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Date:

  	
   

  	
  [                   ]

  

 

SPIRENT
plc - £30,000,000

Credit Agreement dated [•] February 2005
(the “Credit Agreement”)

 

We refer to Clause
28.6 (Additional Guarantors) of
the Credit Agreement.

 

We, [name of
proposed guarantor] of [Registered Office] (Registered no.
[                   ]),
agree to become a Guarantor and to be bound by the terms of the Credit
Agreement as a Guarantor in accordance with Clause 28.6 (Additional
Guarantors).

 

Our address for
notices for the purposes of Clause 34.2 (Addresses for notices)
of the Credit Agreement is:
[                   ]

 

We, [name of
proposed guarantor] and Spirent plc, confirm that the representations and
warranties set out in Clause 18 (Representations and
Warranties) of the Credit Agreement deemed to be made on the date of
this Agreement are correct on the date of this Agreement.

 

This Agreement is
entered into as a deed and is governed by English law.

 

[APPLICABLE
EXECUTION CLAUSE FOR ADDITIONAL GUARANTOR FOR SIGNING DEEDS]

 

	
  By:

  
	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  SPIRENT plc

  

 

87

 

SCHEDULE 6

 

FORM OF COMPLIANCE CERTIFICATE

 

	
  To:

  	
   

  	
  LLOYDS TSB BANK plc as Agent

  
	
   

  	
   

  	
   

  
	
  From:

  	
   

  	
  Spirent plc

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Date:

  	
   

  	
  [                   ]

  

 

SPIRENT
plc - £30,000,000

Credit Agreement dated [•] February 2005
(the “Credit Agreement”)

 

This is a
Compliance Certificate.

 

We confirm that:

 

(a)         as at
[                   ]
(the “testing date”), Consolidated Net Debt
was
£[                   ]
and Consolidated EBITDA was
£[                   ];
therefore, the ratio of Consolidated Net Debt to Consolidated EBITDA was
[                   ]
to 1; the maximum ratio permitted under Clause 19.10(a)(i) (Financial covenants) at the testing date is [[2.25 to
1]/[3.0 to 1]];

 

(b)         as at the testing date, Consolidated
EBITA was £[                   ]
and Consolidated Net Interest Expense is
£[                   ];
therefore, the ratio of Consolidated EBITA to Consolidated Net Interest Expense
is
[                   ]
to 1; the minimum ratio permitted under Clause 19.10(a)(ii) (Financial covenants) at the testing date is [[2.5 to 1]/[3.0
to 1]];

 

(c)         Consolidated Net Worth is
£[                   ];

 

(d)         the following companies are Material
Subsidiaries:
[                   ];
and

 

(e)         Percentage of Consolidated EBIT and
Consolidated Total Assets provided by the Company and these Material
Subsidiaries is
[                   ]
and [                   ].

 

	
  By:

  
	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  SPIRENT plc

  

 

88

 

SCHEDULE 7

 

FORM OF MARGIN CERTIFICATE

 

	
  To:

  	
   

  	
  LLOYDS TSB BANK plc as Agent

  
	
   

  	
   

  	
   

  
	
  From:

  	
   

  	
  Spirent plc

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Date:

  	
   

  	
  [                   ]

  

 

SPIRENT
plc - £30,000,000

Credit Agreement dated [•] February 2005
(the “Credit Agreement”)

 

This is a Margin
Certificate.

 

We confirm that as
at
[                   ],
Consolidated Net Debt was
£[                   ]
and Consolidated EBITDA was
£[                   ]
and therefore the ratio of Consolidated Net Debt to Consolidated EBITDA was
[                   ]
to 1.

 

Accordingly the
applicable Margin is, in accordance with Clause 9.5 (Adjustment
of the Margin),
[                   ]
per cent. per annum and the applicable commitment fee in accordance with Clause
22.3(b) is [                   ]
per cent. per annum.

 

	
  By:

  
	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  SPIRENT plc

  

 

 

89

 

SCHEDULE 8

 

EXISTING PREFERRED INDEBTEDNESS

 

SUMMARY OF
PREFERRED INDEBTEDNESS AND SECURITY INTERESTS AS AT 31 DECEMBER 2004

 

	
   

  	
   

  	
  TOTAL

  O/DRAFT

  FACILITIES

  AVAILABLE

  	
   

  	
  TOTAL LOAN

  FACILITIES

  AVAILABLE

  	
   

  	
  OVERDRAFT

  BALANCE

  AS AT

  31-Dec-04

  	
   

  	
  LOAN

  BALANCE

  AS AT

  31-Dec-04

  	
   

  	
  TOTAL

  O’STDING

  31-Dec-04

  	
   

  
	
   

  	
   

  	
  (000)

  	
   

  	
  (000)

  	
   

  	
  (000)

  	
   

  	
  (000)

  	
   

  	
  (000)

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SECURED

  	
   

  	
  855

  	
   

  	
  3,306

  	
   

  	
  724

  	
   

  	
  3,044

  	
   

  	
  3,768

  	
   

  
	
  UNSECURED

  	
   

  	
  6,010

  	
   

  	
  95,815

  	
   

  	
  80

  	
   

  	
  65,198

  	
   

  	
  65,278

  	
   

  
	
  FINANCE LEASES

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  —

  	
   

  	
  9,559

  	
   

  	
  9,559

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  TOTAL

  	
   

  	
  6,866

  	
   

  	
  99,121

  	
   

  	
  804

  	
   

  	
  77,801

  	
   

  	
  78,605

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  UNSECURED SPIRENT PLC INDEBTEDNESS

  	
   

  	
  6,000

  	
   

  	
  95,009

  	
   

  	
  —

  	
   

  	
  65,009

  	
   

  	
  65,009

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  TOTAL SUBSIDIARY FINANCIAL INDEBTEDNESS

  	
   

  	
  £

  	
  866

  	
   

  	
  £

  	
  4,112

  	
   

  	
  £

  	
  804

  	
   

  	
  £

  	
  12,792

  	
   

  	
  £

  	
  13,596

  	
   

  
																	

 

90

 

SCHEDULE 9

 

SUBSIDIARIES

 

PART I

 

MATERIAL SUBSIDIARIES

 

Spirent
Communications of Rockville, Inc.

 

Spirent
Communications Inc.

 

HellermannTyton
GmbH (Germany)

 

HellermannTyton
GmbH (Austria)

 

HellermannTyton
Corporation

 

HellermannTyton
Data Ltd.

 

Hellerman Tyton AB
(France)

 

Hellerman Tyton SA
(Sweden)

 

PG Drives
Technology Inc.

 

Spirent
Communications of Ottawa Ltd.

 

HellermannTyton
(Pty) Ltd

 

Spirent
Communications Limited

 

Spirent
Communications (Scotland) Limited

 

Spirent Holdings
Corporation

 

Spirent Plc

 

Spirent GmbH

 

Spirent
Communications (Asia) Ltd

 

91

 

PART II

 

INITIAL GUARANTORS – PRE- NORMALISATION DATE

 

Spirent
Communications of Rockville, Inc.

 

Spirent
Communications Inc.

 

Spirent
Communications of Ottawa Ltd.

 

HellermannTyton
Corporation

 

HellermannTyton
Canada Incorporated

 

PG Drives
Technology Inc.

 

PG International
plc

 

HellermannTyton
Data Ltd.

 

Spirent
Communications (Scotland) Limited

 

Spirent
Communications (SW) Limited

 

Spirent
Communications Limited

 

Spirent Holdings
Corporation

 

Spirent Financing
Corporation

 

Netcom Systems
Holding Corporation

 

Spirent Overseas
Limited

 

92

 

PART III

 

INITIAL GUARANTORS - AFTER THE NORMALISATION DATE

 

Spirent
Communications of Rockville, Inc.

 

Spirent
Communications Inc.

 

HellermannTyton
Corporation

 

Spirent
Communications (Scotland) Limited

 

Spirent
Communications (SW) Limited

 

Spirent
Communications Limited

 

Spirent Holdings
Corporation

 

93

 

SIGNATORIES

 

Company

 

SPIRENT plc

 

By: [signed]

 

Eric Hutchinson

Finance Director

 

94

 

	
  Arrangers

  	
   

  
	
   

  	
   

  	
   

  
	
  COMMERZBANK AG,
  London Branch

  
	
   

  	
   

  	
   

  
	
  By:

  	
  [signed] [signed]

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  HSBC BANK plc

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
  [signed] Tony Cox

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  LLOYDS TSB BANK
  plc

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
  [signed] Jon Eltringham

  	
   

  
	
   

  	
   

  	
   

  
	
  THE ROYAL BANK OF
  SCOTLAND plc

  
	
   

  	
   

  	
   

  
	
  By:

  	
  [signed] Adrian Nichols

  	
   

  
	
   

  	
   

  	
   

  
	
  Banks

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  COMMERZBANK AG,
  London Branch

  
	
   

  	
   

  	
   

  
	
  By:

  	
  [signed] [signed]

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  HSBC BANK plc

  
	
   

  	
   

  	
   

  
	
  By:

  	
  [signed] Tony Cox

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  JPMORGAN CHASE
  BANK, N.A.

  
	
   

  	
   

  	
   

  
	
  By:

  	
  [signed] John Blackborough

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  LLOYDS TSB BANK
  plc

  
	
   

  	
   

  	
   

  
	
  By:

  	
  [signed] Jon Eltringham

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  THE ROYAL BANK OF
  SCOTLAND plc

  
	
   

  	
   

  	
   

  
	
  By:

  	
  [signed] Adrian Nichols

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Agent

  	
   

  
	
   

  	
   

  	
   

  
	
  LLOYDS TSB BANK
  plc

  
	
   

  	
   

  	
   

  
	
  By:

  	
  [signed] Michael Dutfield

  	
   

  

 

95Exhibit 4.9

 

Execution Copy

 

SPIRENT plc

 

 

 

SECOND AMENDMENT AND CONSENT AGREEMENT

 

 

 

DATED AUGUST 13, 2004

 

 

US$10,000,000

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

 

US$63,406,000

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

 

US$115,000,000

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

 

US$29,594,000

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

 

 

BINGHAM MCCUTCHEN LLP

LONDON

 

 

SPIRENT plc

 

 

SECOND
AMENDMENT AND CONSENT AGREEMENT

 

 

 

US$10,000,000

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

 

US$63,406,000

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

 

US$115,000,000

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

 

US$29,594,000

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

 

 

Dated August 13, 2004

 

To each of the Current Noteholders

Named in Annex 1 hereto:

 

Ladies and Gentlemen:

 

SPIRENT plc, a limited company organized and existing under
the laws of England and Wales with registered number 470893 (together with its
successors and assigns, the “Company”),
hereby agrees with you as follows:

 

1.            PRIOR ISSUANCE OF NOTES,
ETC.

 

Pursuant to the separate Note
Purchase Agreements, dated November 23, 1999, among the Company (formerly
known as Bowthorpe plc) and, respectively, the purchasers named in
Schedule A thereto (as amended and restated pursuant to the Amended and
Restated Note Purchase Agreement dated March 11, 2003 and as further
amended pursuant to the Amendment and Consent Agreement dated December 31,
2003, and as in effect immediately prior to giving effect to the Amendments
(defined below) provided for by this Agreement, collectively, the “Existing Note Purchase Agreement”,
and as may be amended pursuant to the Amendments or further amended, restated
or otherwise modified from time to time, collectively, the “Note
Purchase Agreement”), the Company issued and sold
(a) US$10,000,000 aggregate original principal amount of its Amended and
Restated Series A Senior Notes due November 23, 2006,
(b) US$63,406,000 aggregate original principal amount of its Amended and
Restated Series B Senior Notes due November 23, 2009,
(c) US$115,000,000 aggregate original principal amount of its Amended and
Restated Series C Senior Notes due November 23, 2009, and
(d) US$29,594,000 aggregate original principal amount of its Amended and
Restated Series D Senior Notes due November 23, 2009 (as in

 

1

 

effect immediately prior to
the Effective Time (as defined below), the “Existing Notes”
and, as may be amended pursuant to the Amendments or further amended, restated
or otherwise modified from time to time, the “Notes”).

 

This Second Amendment and Consent
Agreement is referred to herein as this “Agreement”.  The register kept by the Company for the
registration and transfer of the Notes indicates that each of the Persons named
in Annex 1 (collectively, the “Current Noteholders”)
is currently a holder of the Notes in the aggregate principal amount indicated
opposite such Person’s name in such Annex and that the Persons named in Annex 1
currently hold 100% of the outstanding Notes.

 

2.             DEFINED TERMS.

 

Capitalized terms used herein
and not otherwise defined have the meanings ascribed to them in the Note
Purchase Agreement or in the Amendment and Consent Agreement dated
December 31, 2003, as the case may be.

 

3.             REQUEST FOR CONSENT.

 

The Company requests that each
of you consent to the Amendments with respect to certain terms of the Existing
Note Purchase Agreement and to certain other matters specified in this
Agreement as referred to in the request letters from the Company dated
July 6, 2004 and July 27, 2004 respectively and attached hereto as
Annex 2 and 3 respectively (collectively, the “Requests”).

 

4.             COMPANY WARRANTIES AND
REPRESENTATIONS.

 

To induce you to enter into
this Agreement, the Company warrants and represents as follows (it being
agreed, however, that nothing in this Section 4 shall affect any of the
warranties and representations previously made by the Company in or pursuant to
the Note Purchase Agreement and that all of such other warranties and
representations, as well as the warranties and representations in this
Section 4, shall survive the effectiveness of the Amendments):

 

4.1          Corporate
Organization and Authority.

 

(a)           The
Company and each of its Material Subsidiaries is a corporation or other legal
entity duly organized, validly existing and, in the case of each such Material
Subsidiary organized under the laws of any state of the United States of
America, in good standing under the laws of its jurisdiction of incorporation.

 

(b)           The
Company and each of its Material Subsidiaries has the corporate or other power
and authority to own or hold under lease the properties it purports to own or
hold under lease, to transact its business as now conducted and as presently
proposed to be conducted.

 

(c)           The
Company and each of its Material Subsidiaries is duly qualified and, in the
case of each such Material Subsidiary conducting business in any state of the
United States of America, is in good standing as a foreign corporation in each
jurisdiction wherein the nature of the business transacted by it, or the nature
of the property owned or leased by it, makes such qualification required by law
and where

 

2

 

failure to be so qualified or in good standing would,
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect on the business, operations or financial condition of the
Company and its Subsidiaries, taken as a whole.

 

4.2          Financial
Indebtedness.

 

The Financial Indebtedness of
the Company and its Subsidiaries as at July 4, 2004 is described in Part 4.2 of Annex
4.

 

4.3          Agreements
Authorized; Obligations Enforceable.

 

(a)           The
execution and delivery by the Company of this Agreement has been duly
authorized by all necessary corporate action on its part.  This Agreement has been executed and
delivered by one or more duly authorized officers or directors of the Company,
and each of this Agreement, the Notes and the Note Purchase Agreement after
giving effect to the Amendments constitute a legal, valid and binding
obligation of the Company, enforceable in accordance with its terms, except
that the enforceability hereof and thereof may be limited by:

 

(i)            applicable bankruptcy, reorganization, arrangement,
insolvency, moratorium, or other similar laws affecting the enforceability of
creditors’ rights generally; and

 

(ii)           general principles of equity (regardless of whether
enforcement is sought in a proceeding in equity or at law).

 

(b)           Upon
the execution and delivery by the Guarantors of the Acknowledgement and Consent
attached hereto it will have been duly authorized by all necessary action on
the part of each Guarantor.  The
Acknowledgement and Consent attached hereto will have been executed and
delivered by one or more duly authorized officers or directors of each
Guarantor, and the Subsidiary Guarantees after giving effect to the Amendments
will constitute a legal, valid and binding obligation of each Guarantor in
respect thereof, enforceable in accordance with their terms, except that the
enforceability hereof and thereof may be limited by:

 

(i)            applicable bankruptcy, reorganization, arrangement,
insolvency, moratorium, or other similar laws affecting the enforceability of
creditors’ rights generally; and

 

(ii)           general principles of equity (regardless of whether
enforcement is sought in a proceeding in equity or at law).

 

4.4          No
Conflicts.

 

Neither the execution nor
delivery of this Agreement, nor performance by the Company of the terms and
provisions of the Notes or the Note Purchase Agreement after giving effect to
the Amendments, nor compliance by each Guarantor with the terms and provisions
of its respective Subsidiary Guarantee, will conflict with, or result in a
breach of the terms, conditions or provisions of, or constitute a default
under, or result in any violation of, or result in the creation of any Lien
upon any of the properties of the Company or any of its Subsidiaries under the
memorandum or articles of association (or charter or by-laws) of

 

3

 

the Company or any of its
Subsidiaries, or any award of any arbitrator or any agreement (including the
New Bank Facility and any agreement with shareholders), instrument, order,
judgment, decree, statute, law, rule or regulation to which the Company or
any of its Subsidiaries is subject.

 

4.5          Full
Disclosure.

 

Neither this Agreement nor any
other written statement furnished by or on behalf of the Company or any of its
Subsidiaries to the Current Noteholders in connection with the proposal and
negotiation of the Amendments, or the other terms and provisions of this
Agreement, contains any untrue statement of a material fact or omits a material
fact necessary to make the statements contained therein, taken as a whole,
under the circumstances under which made, not misleading.  Except as previously disclosed in writing to
each Current Noteholder, there is no fact known to the Company or any Material
Subsidiary that could reasonably be expected to have a Material Adverse Effect
upon the business, operations or principal properties of the Company and its
Subsidiaries taken as a whole.

 

4.6          Amendments
to New Bank Facility.

 

Except as described in Part 4.6 of
Annex 4, there have been no amendments, waivers or other modifications to the
New Bank Facility subsequent to February 4, 2004 and the New Bank Facility
is in full force and effect on the date hereof. 

 

4.7          No
Defaults.

 

No Default or Event of Default
has occurred and is continuing.  No event
has occurred and no condition exists that would constitute a default, event of
default or potential default (howsoever described) under the New Bank Facility.

 

4.8          Guaranties.

 

No Subsidiary of the Company,
other than Subsidiaries which are Guarantors as at the Effective Time, has
entered into or is liable under any guaranty of any Financial Indebtedness of
any Person arising under the New Bank Facility.

 

5.             AMENDMENTS TO EXISTING NOTE
PURCHASE AGREEMENT.

 

Subject to the conditions
specified in Section 7, the Existing Note Purchase Agreement is hereby
amended in the manner provided in Exhibit A to this Agreement (the “Amendments”).

 

4

 

6.             CONSENT TO DISPOSAL.

 

Subject to
the conditions to effectiveness specified in Section 7, each of the
Current Noteholders hereby renews and confirms its consent to the disposal as
referred to in the Request attached hereto as Annex 3 (the “Disposal”) and waives any breach of Section 8.3  or Section 10.4(b) of the
Existing Note Purchase Agreement which may arise thereunder solely as
consequence of the Disposal (the “Consent”).

 

7.             CONDITIONS TO
EFFECTIVENESS.

 

The Amendments provided for in
Section 5 and the Consent provided for in Section 6 shall each become
effective, if at all, at such time (the “Effective Time”)
as the Company and the Required Holders shall have executed and delivered
counterparts of this Agreement and the following conditions shall have been
satisfied by the Company (or waived by the Required Holders):

 

7.1          Representations
and Warranties.

 

The representations and
warranties set forth in Section 4 shall be true and correct.

 

7.2          Due
Authorization, etc.

 

The Company shall have
authorized, by all necessary corporate action, the execution and delivery of
this Agreement, the performance of all of its obligations under this Agreement,
and the consummation of all transactions by it contemplated by this Agreement,
and the Current Noteholders and their special counsel shall have received such
certificates and other evidence to such effect (including, without limitation,
secretary’s certificates and board resolutions) as the Required Holders and
their special counsel may reasonably request.

 

7.3          Amendments
to New Bank Facility and Consent of Banks.

 

(a)           The relevant members of the
Group and all other applicable parties to the New Bank Facility shall have
amended the New Bank Facility on the same substantive terms as the Amendments,
all of the conditions precedent to the effectiveness thereof shall have been
satisfied or waived by the parties thereto (except for any condition precedent
thereunder requiring the execution and delivery of this Agreement), such
amendment shall be in full force and effect and shall be satisfactory in form,
scope and substance to the Current Noteholders and their special counsel and a
copy of the email and/or all other documentation evidencing such amendment
shall have been delivered to the Current Noteholders or their special
counsel.  

 

(b)           The Banks pursuant to the
New Bank Facility Agreement shall have consented to the Disposal on the same
substantive terms as the Consent, which consent shall otherwise be satisfactory
in form, scope and substance to the Current Noteholders. 

 

(c)           There shall have been no
adjustment to the compensation payable to the Banks pursuant to the New Bank
Facility in connection with the amendments to the New Bank Facility, the
consent by the Banks to the Disposal or otherwise.

 

(d)           The Current Noteholders or
their special counsel shall have received such certificates and other evidence
as the Required Holders and their special counsel

 

5

 

may
reasonably request confirming that the documentation delivered pursuant to
Section 7.3(a) constitutes all the documentation evidencing the
amendments to the New Bank Facility.

 

7.4          Fees
and Expenses.

 

The Company shall have paid
all amounts required to have been paid to date pursuant to Section 9,
including, without limitation, the reasonable fees and expenses of Bingham
McCutchen LLP, special counsel for the holders of the Notes, and
PricewaterhouseCoopers LLP, reporting accountants to the holders of the Notes,
as reflected in statements to be presented to the Company before the Effective
Time.

 

7.5          Disposal
Documentation.

 

The Disposal
referred to in the Request and attached hereto as Annex 3 shall have been
carried out substantially in the manner and substantially on the terms contemplated
in the Request attached hereto as Annex 3 (including in respect of the amount
of proceeds to be received) and pursuant to sale documentation, final drafts or
certified copies of which shall have been provided to Bingham McCutchen LLP,
special counsel for the Current Noteholders (on economic terms satisfactory to
the Current Noteholders) prior to the consummation of the Disposal (such final
drafts or certified copies delivered to the Noteholders in accordance with this
sentence being hereinafter collectively referred to as the “Disposal Documentation”).  Notwithstanding the foregoing, the Company
shall procure that certified copies of all Disposal Documentation are delivered
to the Noteholders promptly after the execution thereof.

 

8.             CONDITIONS SUBSEQUENT.

 

8.1          Consent
of Guarantors.

 

Each Guarantor shall have
authorized, by all necessary corporate action, the execution and delivery of
the Acknowledgement and Consent attached hereto and shall have indicated its
acknowledgement and consent in respect of this Agreement by executing the
Acknowledgement and Consent attached hereto within 30 days of the date of this
Agreement.

 

8.2          Prepayment
of the Notes.

 

(a)           Within seven days of the consummation of the
Disposal, the Company shall have prepaid the Notes by a principal amount equal
to 100% of the consideration received by the Company and its Subsidiaries in
connection with, or arising from, such Disposal, less (i) reasonable professional
advisers’ fees incurred in connection with the Disposal (provided that the
details thereof (in form and substance reasonably satisfactory to the Current
Noteholders) shall have been provided to the Current Noteholders prior to the
consummation of the Disposal), and (ii) other expenses attributable to the
Disposal that have been reasonably incurred by the Company and its Subsidiaries
(provided that the details thereof (in form and substance reasonably
satisfactory to the Current Noteholders) shall have been provided to the
Current Noteholders prior to the consummation of the Disposal) plus the Make-Whole Amount determined for the prepayment
date with respect to such prepaid principal as provided in Section 8.3 and
Section 8.9 of the Existing Note Purchase Agreement respectively, to be
allocated between the holders of the Notes pro rata in
accordance with the principal amount of Notes held as set forth in Annex 1,
together with accrued unpaid interest

 

6

 

on such amount of prepaid principal to the
prepayment date to be paid by the Company to the holders of the Notes as
provided in Section 8.5 of the Existing Note Purchase Agreement. 

 

(b)           To the extent that any amounts are received by any member of the
Group at any time in respect of, or in connection with, contingent, adjusted,
or deferred consideration in connection with or arising from the Disposal which
in the aggregate total more than $500,000 (collectively, “Post-Closing Adjustments”),
within seven days of receipt thereof, the Company shall prepay the Notes by a
principal amount equal to 100% of any such Post-Closing Adjustments plus the Make-Whole Amount determined for the prepayment
date with respect to such prepaid principal as provided in Section 8.3 and
Section 8.9 of the Existing Note Purchase Agreement respectively, to be
allocated between the holders of the Notes pro rata in
accordance with the principal amount of Notes held at such date, together with
accrued unpaid interest on such amount of prepaid principal to the prepayment
date to be paid by the Company to the holders of the Notes as provided in
Section 8.5 of the Existing Note Purchase Agreement.

 

8.3          Breach
of Conditions Subsequent.

 

Any breach by any
member of the Group of the provisions of Section 8.1 of this Agreement
will constitute an Event of Default under Section 11(d) of the Note
Purchase Agreement and any breach by any member of the Group of the provisions
of Section 8.2 of this Agreement will constitute an immediate Event of
Default under Section 11(c)(i) of the Note
Purchase Agreement.

 

9.             EXPENSES.

 

Whether or not the Amendments
or the Consent become effective, the Company will promptly (and in any event
within thirty (30) days of receiving any statement or invoice therefor) pay all
reasonable out-of-pocket costs and expenses of the Current Noteholders relating
to this Agreement and all related documentation contemplated herein, including,
but not limited to (a) the cost of reproducing this Agreement and any
other documents delivered in connection herewith and the transactions
contemplated hereby, and (b) the reasonable fees and expenses of Bingham
McCutchen LLP, special counsel for the holders of the Notes, and
PricewaterhouseCoopers LLP, reporting accountants to the holders of the Notes,
incurred in connection with such matters.

 

10.          MISCELLANEOUS.

 

10.1        Part of
Note Purchase Agreement, Future References, etc.

 

This Agreement shall be
construed in connection with and as a part of the Notes and the Note Purchase
Agreement and, except as expressly amended by this Agreement, all terms,
conditions and covenants contained in the Notes, the Note Purchase Agreement
and the Subsidiary Guarantees are hereby ratified and shall be and remain in
full force and effect.  Any and all
notices, requests, certificates and other instruments executed and delivered
after the execution and delivery of this Agreement may refer to the Notes and
the Note Purchase Agreement without making specific reference to this
Agreement, but nevertheless all such references shall include this Agreement
unless the context otherwise requires.

 

7

 

10.2        Governing
Law.

 

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

 

10.3        Duplicate
Originals, Execution in Counterpart.

 

Two (2) or more duplicate
originals hereof may be signed by the parties, each of which shall be an
original but all of which together shall constitute one and the same
instrument.  This Agreement may be
executed in one or more counterparts and shall be effective at the time
provided in Section 7 and each set of counterparts that, collectively,
show execution by the Company and each consenting Current Noteholder shall
constitute one duplicate original.

 

 

[signature
pages immediately follow]

 

8

 

If this Agreement is
satisfactory to you, please so indicate by signing the applicable acceptance on
a counterpart hereof and returning such counterpart to the Company.

 

	
   

  	
  Very truly yours,

  
	
   

  	
   

  
	
   

  	
  SPIRENT plc

  
	
   

  	
   

  
	
   

  	
  By

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  

 

 

[Signature page for SECOND
AMENDMENT AND CONSENT AGREEMENT of SPIRENT PLC]

 

 

	
  THE LINCOLN NATIONAL LIFE INSURANCE COMPANY

  	
   

  	
   

  
	
  By: Delaware Investment Advisers, a Series of Delaware

  	
   

  	
   

  
	
       Management Business Trust, Its
  Attorney-in-Fact

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By

  	
   

  	
   

  	
   

  	
   

  
	
  Name:

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  
					

 

 

	
  LINCOLN LIFE & ANNUITY COMPANY OF NEW YORK

  	
   

  	
   

  
	
  By: Delaware Investment Advisers, a Series of Delaware

  	
   

  	
   

  
	
       Management Business Trust, Its
  Attorney-in-Fact

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By

  	
   

  	
   

  	
   

  	
   

  
	
  Name:

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  
					

 

 

	
  FIRST PENN-PACIFIC LIFE INSURANCE COMPANY

  	
   

  	
   

  
	
  By: Delaware Investment Advisers, a Series of Delaware

  	
   

  	
   

  
	
       Management Business Trust, Its
  Attorney-in-Fact

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By

  	
   

  	
   

  	
   

  	
   

  
	
  Name:

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  
					

 

 

	
  METROPOLITAN
  LIFE INSURANCE COMPANY

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By

  	
   

  	
   

  	
   

  	
   

  
	
  Name:

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  
					

 

 

	
  ONE
  MADISON INVESTMENTS (CAYCO) LIMITED

  	
   

  	
   

  
	
  By:

  	
  Metropolitan
  Life Insurance Company,

  	
   

  	
   

  
	
   

  	
  as Investment
  Manager

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By

  	
   

  	
   

  	
   

  	
   

  
	
  Name:

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  
						

 

 

	
  METROPOLITAN
  PROPERTY AND CASUALTY

  INSURANCE COMPANY

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By

  	
   

  	
   

  	
   

  	
   

  
	
  Name:

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  
					

 

 

	
  METROPOLITAN
  INSURANCE AND ANNUITY COMPANY

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By

  	
   

  	
   

  	
   

  	
   

  
	
  Name:

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  
					

 

 

	
  TEACHERS
  INSURANCE AND ANNUITY

  ASSOCIATION OF AMERICA

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By

  	
   

  	
   

  	
   

  	
   

  
	
  Name:

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  
					

 

 

	
  THE
  TRAVELERS INSURANCE COMPANY

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By

  	
   

  	
   

  	
   

  	
   

  
	
  Name:

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  
					

 

 

	
  PRIMERICA
  LIFE INSURANCE COMPANY

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By

  	
   

  	
   

  	
   

  	
   

  
	
  Name:

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  
					

 

 

	
  CONNECTICUT
  GENERAL LIFE INSURANCE COMPANY

  	
   

  	
   

  
	
  By:

  	
  CIGNA
  Investments, Inc. (authorized agent)

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By

  	
   

  	
   

  	
   

  	
   

  
	
  Name:

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  
						

 

 

	
  LIFE
  INSURANCE COMPANY OF NORTH AMERICA

  	
   

  	
   

  
	
  By:

  	
  CIGNA
  Investments, Inc. (authorized agent)

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By

  	
   

  	
   

  	
   

  	
   

  
	
  Name:

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  
						

 

 

	
  MASSACHUSETTS
  MUTUAL LIFE INSURANCE COMPANY

  	
   

  	
   

  
	
  By:

  	
  Babson Capital
  Management LLC, as Investment Adviser

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By

  	
   

  	
   

  	
   

  	
   

  
	
  Name:

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  
						

 

 

	
  SWISS
  RE LIFE & HEALTH AMERICA INC

  	
   

  	
   

  
	
  By:

  	
  Swiss Re Asset Management (Americas) Inc.

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By

  	
   

  	
   

  	
   

  	
   

  
	
  Name:

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  
						

 

 

ACKNOWLEDGEMENT AND CONSENT

 

Each of the undersigned hereby acknowledges,
consents and agrees to the terms and provisions of this Agreement and confirms
that its Subsidiary Guarantee continues in full force and effect in respect of
the Notes and the Note Purchase Agreement as amended by the terms of this
Agreement.

 

	
  EXECUTED
  by

  	
   

  
	
  PG
  DRIVES TECHNOLOGY, INC.

  	
   

  
	
   

  
	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
  EXECUTED
  by

  
	
  SPIRENT
  COMMUNICATIONS INC.

  
	
   

  
	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
  EXECUTED
  by

  
	
  SPIRENT
  COMMUNICATIONS OF ROCKVILLE, INC.

  
	
   

  
	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
  EXECUTED
  by

  
	
  HELLERMANNTYTON
  CORPORATION

  
	
   

  
	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
  EXECUTED
  by

  
	
  HELLERMANNTYTON
  CANADA INCORPORATED

  
	
   

  
	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  
				

 

 

	
  EXECUTED
  by

  	
   

  
	
  SPIRENT
  COMMUNICATIONS OF OTTAWA LIMITED

  	
   

  
	
   

  
	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
  EXECUTED
  by

  
	
  PG
  INTERNATIONAL PLC

  
	
   

  
	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
  EXECUTED
  by

  
	
  HELLERMANNTYTON
  DATA LIMITED

  
	
   

  
	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
  EXECUTED
  by

  
	
  SPIRENT
  COMMUNICATIONS (SCOTLAND) LIMITED

  
	
   

  
	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
  EXECUTED
  by

  
	
  SPIRENT
  COMMUNICATIONS (SW) LIMITED

  
	
   

  
	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
  EXECUTED
  by

  
	
  SPIRENT
  COMMUNICATIONS LIMITED

  
	
   

  
	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  
				

 

 

	
  EXECUTED
  by

  	
   

  
	
  SPIRENT
  HOLDINGS CORPORATION

  	
   

  
	
   

  
	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
  EXECUTED
  by

  
	
  SPIRENT
  INTERNATIONAL, INC.

  
	
   

  
	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
  EXECUTED
  by

  
	
  SPIRENT
  FINANCING CORPORATION

  
	
   

  
	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
  EXECUTED
  by

  
	
  NETCOM
  SYSTEMS HOLDING CORPORATION

  
	
   

  
	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
  EXECUTED
  by

  
	
  SPIRENT
  OVERSEAS LIMITED

  
	
   

  
	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
  EXECUTED
  by

  
	
  REORG
  COMPANY 1, INC.

  
	
   

  
	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  
				

 

 

	
  EXECUTED
  by

  
	
  REORG
  COMPANY 2, INC.

  
	
   

  
	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title

  

 

 

ANNEX 1

 

CURRENT NOTEHOLDERS

 

Series A Notes

 

	
  Name of Noteholder

  	
   

  	
  Principal Amount of Notes Held

  	
   

  
	
  The Travelers Insurance Company

  	
   

  	
  $

  	
  5,686,612.07

  	
   

  
					

 

Series B
Notes

 

	
  Name of Noteholder

  	
   

  	
  Principal Amount(s) of Notes Held

  	
   

  
	
  Connecticut
  General Life Insurance Company

  	
   

  	
  $

  	
  12,423,565.72

  	
   

  
	
  Life Insurance
  Company of North America

  	
   

  	
  $

  	
  2,674,162.72

  	
   

  
	
  Massachusetts
  Mutual Life Insurance Company

  	
   

  	
  $

  	
  11,885,167.63

  	
   

  
	
  Primerica Life
  Insurance Company

  	
   

  	
  $

  	
  1,782,775.14

  	
   

  
	
  The Travelers
  Insurance Company

  	
   

  	
  $

  	
  8,913,875.73

  	
   

  

 

Series C
Notes

 

	
  Name of Noteholder

  	
   

  	
  Principal
  Amount(s) of Notes Held

  	
   

  
	
  Metropolitan
  Life Insurance Company

  	
   

  	
  $

  	
  32,777,154.84

  	
   

  
	
  One Madison
  Investments (Cayco) Limited

  	
   

  	
  $

  	
  2,383,793.08

  	
   

  
	
  Metropolitan
  Insurance and Annuity Company

  	
   

  	
  $

  	
  4,767,586.16

  	
   

  
	
  Metropolitan
  Property and Casualty Insurance Company

  	
   

  	
  $

  	
  4,767,586.16

  	
   

  
	
  Teachers
  Insurance and Annuity Association of America

  	
   

  	
  $

  	
  23,837,930.79

  	
   

  

 

Series D
Notes

 

	
  Name of Noteholder

  	
   

  	
  Principal
  Amount(s) of Notes Held

  	
   

  
	
  Swiss Re
  Life & Health America Inc

  	
   

  	
  $

  	
  1,211,278.22

  	
   

  
	
  The Lincoln
  National Life Insurance Company

  	
   

  	
  $

  	
  15,197,907.85

  	
   

  
	
  Lincoln
  Life & Annuity Company of New York

  	
   

  	
  $

  	
  302,819.56

  	
   

  
	
  First
  Penn-Pacific Life Insurance Company

  	
   

  	
  $

  	
  1,211,278.22

  	
   

  

 

1

 

ANNEX 2

 

[See attached request letter dated
July 6, 2004]

 

2

 

Eric
G Hutchinson

FINANCE DIRECTOR

 

 

06 July 2004

 

 

	
  Mr. Barry Russell

  Bingham McCutchen LLP

  8-10 Mansion House
  Place

  London

  EC4N 8LB

  	
  HSBC Bank plc, as Agent

  Attn: Mr. Wesley Fallon

  Level 24

  8 Canada Square

  London

  E14 5HQ

  

 

 

Dear Sirs:

 

 

Share
Appreciation Rights Scheme (SARS)

 

 

As
highlighted in the PriceWaterhouseCoopers Project Conker Quarterly Monitoring
Report:  Q1 2004 (7 May 2004), Spirent
has implemented a new share appreciation rights scheme for its Communications
employees in replacement of the Spirent Stock Option Plan in order to keep its
remuneration package competitive.  This
received shareholder approval at our 22 June EGM.  The scheme will involve granting shares based
on the performance of the Spirent share price rather than granting options over
shares. This will enable Spirent to better manage dilution.

 

The covenant
calculations in the loan documentation are based on UK GAAP as applied by
Spirent at 31 December 2002.  Using such
UK GAAP accounting, our auditors advise that SARS will give rise to a charge or
credit to operating profit calculated with reference to mark to market
valuations of the liability based on the Spirent share price at the end of the
accounting period and accrued for over the vesting period. Spirent will settle
the liability though the issue of new Spirent shares and therefore this charge
is non-cash and has no effect on the net debt or the net worth of the Spirent
Group.

 

Under this accounting treatment, granting of SARS will
create volatility in the profit and loss account of Spirent plc. As the charge
will be calculated by reference to the Spirent share price this could be
extremely volatile. The effect of this profit and loss charge or credit for the
SARS distorts the underlying operating result and consequently should be
excluded from the earnings definitions throughout the lending documents.  The attached
Appendix illustrates such distortions in the context of three scenarios looking
at the effect on net interest cover.

 

While we understand there may not be a uniform accepted practice for
the accounting treatment of SARS under UK GAAP, for clarity and certainty, we
request that the lenders agree to, and permit, the exclusion of the profit and
loss charge or credit for the SARS from the definition EBIT, EBITA and EBITDA in the lending documents.

 

I would be obliged if lenders would respond to this
request regarding accounting for the SARS by 30th July.

 

 

 

With respect to the letter we sent on 10 June requesting consent to the
potential sale of our MRO division, we thank you for your prompt attention to
that request and for your response. However, we were unable to progress matters
with the potential purchaser who prompted the request we sent to you.  At this time, we continue to evaluate the MRO
business and its prospects, including possible interest in purchasing the
division expressed by another party, and we will keep you informed as to any
further  progress in that regard.

 

Yours faithfully,

 

 

Eric G.
Hutchinson

Finance Director

 

 

APPENDIX

 

	
  Asumption:

  	
  24 million SARS granted each
  year with 25% vesting each year assumed that all SARS are exercised one year
  after vesting

  

 

 

	
   

  	
   

  	
  2004

  	
   

  	
  2005

  	
   

  	
  2006

  	
   

  	
  2007

  	
   

  
	
  Scenario A

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  20% share price growth and earnings growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Share price at grant(£)

  	
   

  	
  0.58

  	
   

  	
  0.70

  	
   

  	
  0.84

  	
   

  	
  1.00

  	
   

  
	
  Share price at 31 December(£)

  	
   

  	
  0.70

  	
   

  	
  0.84

  	
   

  	
  1.00

  	
   

  	
  1.20

  	
   

  
	
  SARS charge UK GAAP (£ million)

  	
   

  	
  1.5

  	
   

  	
  5.1

  	
   

  	
  9.8

  	
   

  	
  14.8

  	
   

  
	
  EBITA (£ milion)

  	
   

  	
  34

  	
   

  	
  40.8

  	
   

  	
  49.0

  	
   

  	
  58.8

  	
   

  
	
  EBITA post SARS (£ million)

  	
   

  	
  32.6

  	
   

  	
  35.7

  	
   

  	
  39.1

  	
   

  	
  43.9

  	
   

  
	
  Net interest (£ million)

  	
   

  	
  6.6

  	
   

  	
  6.6

  	
   

  	
  6.6

  	
   

  	
  6.6

  	
   

  
	
  EBITA:Net interest (excluding SARS)

  	
   

  	
  5.2

  	
   

  	
  6.2

  	
   

  	
  7.4

  	
   

  	
  8.9

  	
   

  
	
  EBITA:net interest (including SARS)

  	
   

  	
  4.9

  	
   

  	
  5.4

  	
   

  	
  5.9

  	
   

  	
  6.7

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Scenario B

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  80% share price and earnings growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Share price at grant(£)

  	
   

  	
  0.58

  	
   

  	
  1.04

  	
   

  	
  1.88

  	
   

  	
  3.38

  	
   

  
	
  Share price at 31 December(£)

  	
   

  	
  1.04

  	
   

  	
  1.88

  	
   

  	
  3.38

  	
   

  	
  6.09

  	
   

  
	
  SARS charge UK GAAP (£ million)

  	
   

  	
  5.8

  	
   

  	
  29.3

  	
   

  	
  82.1

  	
   

  	
  184.5

  	
   

  
	
  EBITA (£ milion)

  	
   

  	
  34

  	
   

  	
  61.2

  	
   

  	
  110.2

  	
   

  	
  198.3

  	
   

  
	
  EBITA post SARS (£ million)

  	
   

  	
  28.2

  	
   

  	
  31.9

  	
   

  	
  28.0

  	
   

  	
  13.8

  	
   

  
	
  Net interest (£ million)

  	
   

  	
  6.6

  	
   

  	
  6.6

  	
   

  	
  6.6

  	
   

  	
  6.6

  	
   

  
	
  EBITA:Net interest (excluding SARS)

  	
   

  	
  5.2

  	
   

  	
  9.3

  	
   

  	
  16.7

  	
   

  	
  30.0

  	
   

  
	
  EBITA:net interest (including SARS)

  	
   

  	
  4.3

  	
   

  	
  4.8

  	
   

  	
  4.2

  	
   

  	
  2.1

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Scenario C

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  80% share price and earnings growth years
  1&2 followed by 80% reduction year 3 flat year 4

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Share price at grant(£)

  	
   

  	
  0.58

  	
   

  	
  1.04

  	
   

  	
  1.88

  	
   

  	
  0.38

  	
   

  
	
  Share price at 31 December(£)

  	
   

  	
  1.04

  	
   

  	
  1.88

  	
   

  	
  0.38

  	
   

  	
  0.38

  	
   

  
	
  SARS charge UK GAAP (£ million)

  	
   

  	
  5.8

  	
   

  	
  29.3

  	
   

  	
  -35.1

  	
   

  	
  0.0

  	
   

  
	
  EBITA (£ milion)

  	
   

  	
  34

  	
   

  	
  61.2

  	
   

  	
  12.2

  	
   

  	
  12.2

  	
   

  
	
  EBITA post SARS (£ million)

  	
   

  	
  28.2

  	
   

  	
  31.9

  	
   

  	
  47.4

  	
   

  	
  12.2

  	
   

  
	
  Net interest (£ million)

  	
   

  	
  6.6

  	
   

  	
  6.6

  	
   

  	
  6.6

  	
   

  	
  6.6

  	
   

  
	
  EBITA:Net interest (excluding SARS)

  	
   

  	
  5.2

  	
   

  	
  9.3

  	
   

  	
  1.9

  	
   

  	
  1.9

  	
   

  
	
  EBITA:net interest (including SARS)

  	
   

  	
  4.3

  	
   

  	
  4.8

  	
   

  	
  7.2

  	
   

  	
  1.9

  	
   

  

 

Scenario A — 20% share price and
earnings growth

 

Whilst the effect of
charging the mark to market value of SARS does not result in a breach of the
net interest covenant the effect is to reduce interest cover from 8.9 times to
6.7 times in 2007. In this example the share price has moved from 58 pence to
120 pence over the next 4 years the SARS charge accumulates with each grant
resulting in, even at relatively low volatility, a £14.8 million charge in 2007
on earnings of £58.8 million before the charge.

 

Scenario B — 80% share price and earnings growth

 

Although this would
appear to be an extreme case, the Spirent share price has historically been at
these levels. Earnings and the Spirent share price are growing at very high
rates. In 2007 without add back of the SARS charge, interest cover would be in
breach at 2.1 times. In this example earnings before the SARS charge are £198.3
million this would be representative of the cash inflow into the business and
clearly a breach of covenant makes little sense. Without the SARS charge net
interest cover is at a healthy 30.0 times. In this example the most important
financing issue for the Company is being able to fund the large increase
working capital.

 

Scenario C — 80%
share price and earnings growth in years 1&2 followed by 80% reduction in
year 3

 

Another extreme scenario,
earnings and share price grow rapidly over the next two years followed by a
rapid fall, If we include the SARS credit of £35.1 million under UK GAAP
interest cover at the end of 2006 is above the required covenant at 7.2 times.
If the SARS credit is excluded the interest covenant breaches at 1.9 times.

 

 

 

ANNEX 3

 

[See attached request letter dated July 27, 2004]

 

3

 

Eric G Hutchinson

FINANCE DIRECTOR

 

 

27 July 2004

 

 

	
  Mr. Barry
  Russell

  Bingham
  McCutchen LLP

  99 Gresham Street

  London

  EC2V 7HG

  	
   

  

 

 

Dear Sirs:

 

The Disposal of Spirent Systems
MRO Division

In June 2003, our
lenders approved the disposal of two Spirent Systems divisions: AIS and
MRO.  At that time, no offer had yet been
received for the MRO division but it was being marketed and we were
anticipating net proceeds from the sale to be in the region of 2 million US dollars.  The lenders’ approval was granted in this
context.

 

We have now
received an offer for the purchase of the MRO division.  This has been progressed to an agreed letter
of intent and draft contracts have been issued. 
The buyer would like to progress to signing contracts by the end of
August 2004.

 

The MRO division
reported sales of £8.7 million and an EBITA profit of £1.5 million in the year
ended 31 December 2003.  Trading
performance in the six months ended 30 June 2004 resulted in sales of £3.7
million and an EBITA profit of £0.6 million. 
The net assets, including goodwill, of the division are £4.5 million at
the end of June 2004.  The net proceeds
of the MRO sale are expected to be in the region of 5 million US dollars.  It is anticipated that the net proceeds will
be used to reduce proportionately the principal of the outstanding Notes with
the related make-whole payment and associated accrued interest being made
separately out of the company’s cash balances.

 

In June 2004 the lenders agreed in principle to the disposal of the MRO
division in line with the above and it is hereby requested that the lenders
renew and confirm their approval for such disposal to take place at the
earliest opportunity.

 

I would be obliged if
lenders would respond to the above request by 30 July.

 

 

Yours faithfully,

 

 

 

Eric G. Hutchinson

Finance
Director

 

ANNEX 4

 

INFORMATION AS TO COMPANY AND SUBSIDIARIES

 

Part 4.2                   Financial
Indebtedness

[See attached spreadsheet]

 

Part 4.6                   Amendments
to New Bank Facility

[See attached email]

 

4

 

SPIRENT PLC AND ITS SUBSIDIARIES

 

FINANCIAL INDEBTEDNESS AS OF AS AT 4 JULY 2004

 

	
   

  	
   

  	
  TOTAL
  O/DRAFT

  FACILITIES

  AVAILABLE

  (000)

  	
   

  	
  TOTAL
  LOAN

  FACILITIES

  AVAILABLE

  (000)

  	
   

  	
  OVERDRAFT

  BALANCE
  AS AT

  04-Jul-04

  (000)

  	
   

  	
  LOAN

  BALANCE
  AS AT

  04-Jul-04

  (000)

  	
   

  	
  TOTAL

  OUTSTANDING

  04-Jul-04

  GBP
  (000)

  	
   

  	
  OUTSTANDING

  AS AT
  31/12/02

  Ref.
  Note

  GBP
  (000)

  	
   

  	
  “NEW”

  SINCE

  31-Dec-02

  GBP
  (000)

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SECURED

  	
   

  	
  1,747

  	
   

  	
  4,504

  	
   

  	
  716

  	
   

  	
  4,007

  	
   

  	
  4,722

  	
   

  	
  5,350

  	
   

  	
  330

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  UNSECURED

  	
   

  	
  6,000

  	
   

  	
  100,942

  	
   

  	
  —

  	
   

  	
  70,942

  	
   

  	
  70,942

  	
   

  	
  152,495

  	
   

  	
  —

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  FINANCE
  LEASES

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  —

  	
   

  	
  8,671

  	
   

  	
  8,671

  	
   

  	
  9,479

  	
   

  	
  224

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  TOTAL

  	
   

  	
  7,747

  	
   

  	
  105,446

  	
   

  	
  716

  	
   

  	
  83,619

  	
   

  	
  84,335

  	
   

  	
  167,324

  	
   

  	
  554

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  UNSECURED SPIRENT PLC INDEBTEDNESS

  	
   

  	
  6,000

  	
   

  	
  100,942

  	
   

  	
  —

  	
   

  	
  70,942

  	
   

  	
  70,942

  	
   

  	
  152,495

  	
   

  	
  —

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  TOTAL SUBSIDIARY FINANCIAL INDEBTEDNESS

  	
   

  	
  £

  	
  1,747

  	
   

  	
  £

  	
  4,504

  	
   

  	
  £

  	
  716

  	
   

  	
  £

  	
  12,677

  	
   

  	
  £

  	
  13,393

  	
   

  	
  £

  	
  14,829

  	
   

  	
  £

  	
  554

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  * The above Total
  Outstanding Debt does not include £373k of Debt Issues Costs being amortised
  over the life of the facilities.

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  The Increase in Total
  Subsidiary Debt from 31 December 2002 is

  	
   

  	
  £

  	
  554

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
																							

 

 

SPIRENT PLC AND ITS SUBSIDIARIES

 

FINANCIAL INDEBTEDNESS UNSECURED BY LIENS AS AT 4
JULY 2004

 

	
  COMPANY

  	
   

  	
   

  	
   

  	
  LENDER

  	
   

  	
  FINAL

  MATURITY

  	
   

  	
  OVERDRAFT

  FACILITY

  Currency

  (000)

  	
   

  	
  OVERDRAFT

  FACILITY

  GBP

  (000)

  	
   

  	
  TOTAL
  LOAN

  FACILITIES

  Currency

  (000)

  	
   

  	
  TOTAL
  LOAN

  FACILITIES

  GBP

  (000)

  	
   

  	
  OVERDRAFT

  BALANCE
  AS AT

  04-Jul-04

  Currency
  (000)

  	
   

  	
  OVERDRAFT

  BALANCE
  AS AT

  04-Jul-04

  GBP
  (000)

  	
   

  	
  LOAN

  BALANCE
  AS AT

  04-Jul-04

  Currency
  (000)

  	
   

  	
  LOAN

  BALANCE
  AS AT

  04-Jul-04

  GBP
  (000)

  	
   

  	
  OUTSTANDING

  AS AT
  31/12/02

  Ref.
  Note

  GBP
  (000)

  	
   

  	
  “NEW”

  SINCE

  31-Dec-02

  GBP (000)

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  BRITAIN

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Spirent plc 

  	
   

  	
  GBP

  	
   

  	
  HSBC Group Facility

  	
   

  	
  -

  	
   

  	
  6,000

  	
   

  	
  6,000

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  Private Placement Series A

  	
   

  	
  Nov 06

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  5,687

  	
   

  	
  3,108

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  5,687

  	
   

  	
  3,108

  	
   

  	
  6,211

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  Private Placement Series B

  	
   

  	
  Nov 09

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  37,680

  	
   

  	
  20,590

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  37,680

  	
   

  	
  20,590

  	
   

  	
  39,383

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  Private Placement Series C

  	
   

  	
  Nov 09

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  68,534

  	
   

  	
  37,450

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  68,534

  	
   

  	
  37,450

  	
   

  	
  71,429

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  Private Placement Series D

  	
   

  	
  Nov 09

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  17,923

  	
   

  	
  9,794

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  17,923

  	
   

  	
  9,794

  	
   

  	
  18,381

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  Syndicated Facilities

  	
   

  	
  Jul 05

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  30,000

  	
   

  	
  30,000

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  0

  	
   

  	
   

  	
   

  	
  17,091

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  6,000

  	
   

  	
  6,000

  	
   

  	
  159,824

  	
   

  	
  100,942

  	
   

  	
  0

  	
   

  	
  0

  	
   

  	
  129,824

  	
   

  	
  70,942

  	
   

  	
  152,495

  	
   

  	
  0

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Singapore

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Hellermann Tyton Pte Ltd 

  (Singapore) 

  	
   

  	
  SGD

  	
   

  	
  HSBC

  	
   

  	
  un-dated

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  0

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  0

  	
   

  	
  0

  	
   

  	
  0

  	
   

  	
  0

  	
   

  	
  0

  	
   

  	
  0

  	
   

  	
  0

  	
   

  	
  0

  	
   

  	
  0

  	
   

  	
  0

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  TOTAL

  	
   

  	
   

  	
   

  	
  TOTAL

  	
   

  	
   

  	
   

  	
  TOTAL

  	
   

  	
   

  	
   

  	
  TOTAL

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  OVERDRAFT

  	
   

  	
  6,000

  	
   

  	
  ORIGINAL

  	
   

  	
  100,942

  	
   

  	
  UNSECURED

  	
   

  	
  £

  	
  0

  	
   

  	
  UNSECURED

  	
   

  	
  £

  	
  70,942

  	
   

  	
  £

  	
  152,495

  	
   

  	
  £

  	
  0

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  FACILITIES

  	
   

  	
   

  	
   

  	
  LOANS

  	
   

  	
   

  	
   

  	
  OVERDRAFT

  	
   

  	
   

  	
   

  	
  BORROWINGS

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
																																

 

 

SPIRENT PLC AND ITS SUBSIDIARIES

 

FINANCIAL INDEBTEDNESS SECURED BY LIENS AS AT 4
JULY 2004

 

	
  COMPANY

  	
   

  	
   

  	
   

  	
  LENDER

  	
   

  	
  FINAL

  MATURITY

  	
   

  	
  OVERDRAFT

  FACILITY

  Currency

  (000)

  	
   

  	
  OVERDRAFT

  FACILITY

  GBP

  (000)

  	
   

  	
  TOTAL
  LOAN

  FACILITIES

  Currency

  (000)

  	
   

  	
  TOTAL
  LOAN

  FACILITIES

  GBP

  (000)

  	
   

  	
  OVERDRAFT

  BALANCE
  AS AT

  04-Jul-04

  Currency
  (000)

  	
   

  	
  OVERDRAFT

  BALANCE
  AS AT

  04-Jul-04

  GBP
  (000)

  	
   

  	
  LOAN

  BALANCE
  AS AT

  04-Jul-04

  Currency
  (000)

  	
   

  	
  LOAN

  BALANCE
  AS AT

  04-Jul-04

  GBP
  (000)

  	
   

  	
  OUTSTANDING

  AS AT
  31/12/02

  Ref.
  Note

  GBP
  (000)

  	
   

  	
  “NEW”

  SINCE

  31-Dec-02

  GBP
  (000)

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  FRANCE

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Hellermann Tyton SA (France)

  	
   

  	
  Euro

  	
   

  	
  Eurosic

  	
   

  	
  Apr-07

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  1,626

  	
   

  	
  1,091

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  1,169

  	
   

  	
  785

  	
   

  	
  1,063

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  San Paolo IMI

  	
   

  	
  -

  	
   

  	
  1,220

  	
   

  	
  820

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  0

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  BNP Paribas

  	
   

  	
  -

  	
   

  	
  305

  	
   

  	
  205

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  0

  	
   

  	
  0

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  0

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  1,525

  	
   

  	
  1,023

  	
   

  	
  1,626

  	
   

  	
  1,091

  	
   

  	
  0

  	
   

  	
  0

  	
   

  	
  1,169

  	
   

  	
  785

  	
   

  	
  1,063

  	
   

  	
  0

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  GERMANY

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Hellermann Tyton GmbH

  	
   

  	
  Euro

  	
   

  	
  Jurgen Molln

  	
   

  	
  May 2017

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  767

  	
   

  	
  515

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  767

  	
   

  	
  515

  	
   

  	
  501

  	
   

  	
  14

  	
   

  
	
  (Germany)

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Euro

  	
   

  	
  Various

  	
   

  	
  ufn

  	
   

  	
  138

  	
   

  	
  93

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  0

  	
   

  	
   

  	
   

  	
  138

  	
   

  	
  93

  	
   

  	
  0

  	
   

  	
  93

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  138

  	
   

  	
  93

  	
   

  	
  767

  	
   

  	
  515

  	
   

  	
  0

  	
   

  	
  0

  	
   

  	
  905

  	
   

  	
  607

  	
   

  	
  501

  	
   

  	
  106

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ITALY

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  HellermannTyton Srl (Italy)

  	
   

  	
  Euro

  	
   

  	
  San Paolo IMI

  	
   

  	
  -

  	
   

  	
  516

  	
   

  	
  346

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  491

  	
   

  	
  330

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  324

  	
   

  	
  6

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  73

  	
   

  	
  49

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  0

  	
   

  	
  49

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  516

  	
   

  	
  346

  	
   

  	
  0

  	
   

  	
  0

  	
   

  	
  564

  	
   

  	
  379

  	
   

  	
  0

  	
   

  	
  0

  	
   

  	
  324

  	
   

  	
  55

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  UNITED STATES

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Hellermann Tyton Corporation (USA)

  	
   

  	
  USD

  	
   

  	
  Marshall & Ilsley

  	
   

  	
  Feb-08

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  5,304

  	
   

  	
  2,898

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  4,785

  	
   

  	
  2,615

  	
   

  	
  3,294

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  0

  	
   

  	
  0

  	
   

  	
  5,304

  	
   

  	
  2,898

  	
   

  	
  0

  	
   

  	
  0

  	
   

  	
  4,785

  	
   

  	
  2,615

  	
   

  	
  3,294

  	
   

  	
  0

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  BRAZIL

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Hellermann Tyton - Brazil

  	
   

  	
  Real

  	
   

  	
  Banco do Brasil

  	
   

  	
  -

  	
   

  	
  1,211

  	
   

  	
  217

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  1,203

  	
   

  	
  216

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  140

  	
   

  	
  76

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  Banco Sudameris

  	
   

  	
  -

  	
   

  	
  373

  	
   

  	
  67

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  675

  	
   

  	
  121

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  28

  	
   

  	
  93

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  1,584

  	
   

  	
  284

  	
   

  	
  0

  	
   

  	
  0

  	
   

  	
  1,878

  	
   

  	
  337

  	
   

  	
  0

  	
   

  	
  0

  	
   

  	
  168

  	
   

  	
  169

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  TOTAL

  	
   

  	
   

  	
   

  	
  TOTAL

  	
   

  	
   

  	
   

  	
  TOTAL

  	
   

  	
   

  	
   

  	
  TOTAL

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  OVERDRAFT

  	
   

  	
  1,747

  	
   

  	
  ORIGINAL

  	
   

  	
  4,504

  	
   

  	
  SECURED

  	
   

  	
  £

  	
  716

  	
   

  	
  SECURED

  	
   

  	
  £

  	
  4,007

  	
   

  	
  5,350

  	
   

  	
  £

  	
  330

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  FACILITIES

  	
   

  	
   

  	
   

  	
  LOANS

  	
   

  	
   

  	
   

  	
  OVERDRAFT

  	
   

  	
   

  	
   

  	
  BORROWINGS

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
																															

 

 

SPIRENT PLC AND ITS SUBSIDIARIES

 

FINANCE LEASES & HIRE PURCHASE AGREEMENTS
UNDER SSAP 21 OR FRS 5 AS AT 4 JULY 2004

 

	
  COMPANY

  	
   

  	
  LESSOR

  	
   

  	
  FINAL

  MATURITY

  	
   

  	
  ORIGINAL

  AMOUNT

  Currency
  (000)

  	
   

  	
  ORIGINAL

  AMOUNT

  GBP
  (000)

  	
   

  	
  BALANCE

  SHEET

  Currency
  (000)

  	
   

  	
  BALANCE

  SHEET

  GBP
  (000)

  	
   

  	
  OUTSTANDING

  AS AT
  31/12/02

  Ref.
  Note

  GBP
  (000)

  	
   

  	
  “NEW”

  SINCE

  31-Dec-02

  GBP
  (000)

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  UNITED KINGDOM

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  PA-Positioning Tech- GSSL

  	
   

  	
  Lombard

  	
   

  	
  Mar-06

  	
   

  	
  17

  	
   

  	
  17

  	
   

  	
  6

  	
   

  	
  6

  	
   

  	
  11

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  May-06

  	
   

  	
  22

  	
   

  	
  22

  	
   

  	
  8

  	
   

  	
  8

  	
   

  	
  12

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  39

  	
   

  	
  39

  	
   

  	
  14

  	
   

  	
  14

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  EUROPE

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Hellermann Tyton GmbH

  	
   

  	
  TAGO

  	
   

  	
  May 2018

  	
   

  	
  10,635

  	
   

  	
  7,138

  	
   

  	
  9,616

  	
   

  	
  6,454

  	
   

  	
  6,336

  	
   

  	
  118

  	
   

  
	
   

  	
   

  	
  IBM Catia

  	
   

  	
  May 2005

  	
   

  	
  32

  	
   

  	
  21

  	
   

  	
   

  	
   

  	
  0

  	
   

  	
  16

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Spirent Gmbh

  	
   

  	
  SARIO Aachen KG

  	
   

  	
  Dec 2015

  	
   

  	
  3,387

  	
   

  	
  2,273

  	
   

  	
  2,395

  	
   

  	
  1,607

  	
   

  	
  2,156

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  HellermannTyton Srl (Italy)

  	
   

  	
  Car Lease

  	
   

  	
   

  	
   

  	
  53

  	
   

  	
  36

  	
   

  	
  20

  	
   

  	
  13

  	
   

  	
  35

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  14,107

  	
   

  	
  9,469

  	
   

  	
  12,031

  	
   

  	
  8,074

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  UNITED STATES

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  PA Broadband

  	
   

  	
  NTFC Capital Corp

  	
   

  	
  Jul 04

  	
   

  	
  211

  	
   

  	
  115

  	
   

  	
  0

  	
   

  	
  0

  	
   

  	
  41

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Verizon

  	
   

  	
  Oct 06

  	
   

  	
  327

  	
   

  	
  179

  	
   

  	
  0

  	
   

  	
  0

  	
   

  	
  109

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Hellermann Tyton Corporation

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (USA)

  	
   

  	
  EMKAY Inc

  	
   

  	
  Jan-07

  	
   

  	
  1,110

  	
   

  	
  607

  	
   

  	
  506

  	
   

  	
  277

  	
   

  	
  347

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Chrysler Credit Corp

  	
   

  	
  Jun-04

  	
   

  	
  30

  	
   

  	
  16

  	
   

  	
  26

  	
   

  	
  14

  	
   

  	
  16

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Enterprise Leasing

  	
   

  	
  Aug-06

  	
   

  	
  65

  	
   

  	
  36

  	
   

  	
  234

  	
   

  	
  128

  	
   

  	
  34

  	
   

  	
  94

  	
   

  
	
   

  	
   

  	
  Bank of America

  	
   

  	
  Jan-03

  	
   

  	
  40

  	
   

  	
  22

  	
   

  	
  22

  	
   

  	
  12

  	
   

  	
  15

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  CAW Networks

  	
   

  	
  Malsco

  	
   

  	
   

  	
   

  	
  170

  	
   

  	
  93

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  106

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Hellermann Tyton Canada

  	
   

  	
  Chrysler Canada

  	
   

  	
  Mar 06

  	
   

  	
  24

  	
   

  	
  10

  	
   

  	
  14

  	
   

  	
  6

  	
   

  	
  0

  	
   

  	
  5

  	
   

  
	
   

  	
   

  	
  GMAC

  	
   

  	
  Sept 06

  	
   

  	
  32

  	
   

  	
  13

  	
   

  	
  18

  	
   

  	
  7

  	
   

  	
  11

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  GMAC

  	
   

  	
  Sept 05

  	
   

  	
  26

  	
   

  	
  11

  	
   

  	
  11

  	
   

  	
  5

  	
   

  	
  9

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  2,035

  	
   

  	
  1,101

  	
   

  	
  831

  	
   

  	
  448

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SOUTH AFRICA

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Hellermann Tyton (Pty) Ltd

  	
   

  	
  Nedcor

  	
   

  	
  October 06

  	
   

  	
  2,752

  	
   

  	
  246

  	
   

  	
  773

  	
   

  	
  69

  	
   

  	
  134

  	
   

  	
   

  	
   

  
	
  (South Africa)

  	
   

  	
  Stannic

  	
   

  	
  Nov 05

  	
   

  	
  1,301

  	
   

  	
  116

  	
   

  	
  626

  	
   

  	
  56

  	
   

  	
  83

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  4,053

  	
   

  	
  363

  	
   

  	
  1,399

  	
   

  	
  125

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ASIA

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Hellermann Tyton Pte Ltd

  	
   

  	
  Orix Capital Ltd

  	
   

  	
  Sept 08

  	
   

  	
  29

  	
   

  	
  9

  	
   

  	
  24

  	
   

  	
  9

  	
   

  	
  2

  	
   

  	
  7

  	
   

  
	
  (Singapore)

  	
   

  	
  HSBC

  	
   

  	
  August 03

  	
   

  	
  30

  	
   

  	
  10

  	
   

  	
   

  	
   

  	
  0

  	
   

  	
  6

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  59

  	
   

  	
  19

  	
   

  	
  24

  	
   

  	
  9

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  TOTAL

  	
   

  	
   

  	
   

  	
  TOTAL

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  ORIGINAL

  	
   

  	
  10,990

  	
   

  	
  BALANCE

  	
   

  	
  £

  	
  8,671

  	
   

  	
  9,479

  	
   

  	
  £

  	
  224

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  AMOUNT

  	
   

  	
   

  	
   

  	
  SHEET

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
																				

 

 

 

Please
be advised that we are in receipt of unanimous Bank consent to the exclusion of
the profit and loss charge or credit for the SARS from the definition EBIT,
EBITA and EBITDA, as defined in the Agreement, per the terms as outlined in
your Letter.

 

I
trust this is in order.  Should you have
any further queries, please do not hesitate to contact me.

 

Kind
Regards

Wesley
Fallan

For
and on behalf of HSBC Bank plc

As
Agent for the Banks

 

Memo

07
Jul 2004 09:27

 

Subject:  Spirent Plc GBP30m Revolving Credit Facility
dated 4th February 2004 (the "Agreement") re Consent for SARS

 

Dear
all,

 

We
write as Agent for the Banks in connection with the above-named Agreement.  Terms defined in the Agreement shall, unless
otherwise specifically defined herein, have their defined meaning when used in
this e-mail.

 

Please
find below an e-mail from Connie Kolb of Spirent Plc attaching a letter from
Erick Hutchinson dated 6th July 2004 (the "Letter").

 

The
letter seeks your consent to adopt a particular accounting treatment as a
result of Spirent Plc offering a new share appreciation rights scheme
("SARS") to its Communication employees.

 

Could
you kindly review the attached Letter and example appendix document and revert
with your consent to the exclusion of the profit and loss charge or credit for
the SARS from the definition EBIT, EBITA and EBITDA, as defined in the
Agreement.

 

Kindly
revert with your consent to the above direct to myself by return of fax (number
+44 207 991 4351) or via e-mail at your earliest convenience but by no later
than close of business on Wednesday, 21st July 2004.

 

Kind
Regards

Wesley
Fallan

For
and behalf of HSBC Bank plc

As
Agent for the Banks

 

Subject:  Lenders Consent (SARS)

 

Dear
Messrs. Fallan and Russell:

 

As
I believe you are both aware, Spirent has recently implemented a new share
appreciation rights scheme (SARS) for our Communications employees.  The attached letter requests your consent for
Spirent to adopt certain accounting treatment for grants made under this scheme
and the additional pdf attachment provides what we hope are helpful illustrations
of the accounting issues we believe are raised by the SARS.

 

We
appreciate your attention to this request and look forward to your reply.

 

Sincerely,

Connie
Kolb

 

 

EXHIBIT A

 

AMENDMENTS

 

§1           Amendments to Section 23.8(a) of the Existing Note
Purchase Agreement.  Section 23.8(a) of the Existing Note
Purchase Agreement is hereby amended and restated in its entirety to read as
follows:

 

“(a)         Accounting
Principles.  Notwithstanding any changes in
UK GAAP or the interpretation or application thereof subsequent to
December 31, 2002, all financial covenants herein (including those in
Section 10 and the Normalization Conditions) shall be calculated in
accordance with (and compliance shall be determined solely by reference to) UK
GAAP in effect as at December 31, 2002 and as applied by the Company as of
such date save that any charge or credit to operating profit on the SARS Scheme
shall not be taken into account in respect of Consolidated EBIT, Consolidated
EBITA, Consolidated EBITDA and EBIT.  In
the event that there should occur after December 31, 2002 any changes in
UK GAAP or the interpretation or application thereof which would have a
quantifiable effect on the calculation of the financial covenants or the
Normalization Conditions, the Company agrees to provide to each holder of a
Note, in addition to the financial information described in Section 7,
such supplemental financial information with respect to the relevant accounting
periods (calculated in accordance with UK GAAP) affected by such changes as is
reasonably necessary to allow the holders of the Notes to verify compliance
with the financial covenants and the Normalization Conditions.”

 

§2           Amendments
to Schedule B of the Existing Note Purchase Agreement.  Schedule B of the Existing Note
Purchase Agreement is hereby amended by replacing each of the following defined
terms in its appropriate place in alphabetical order in such Schedule:

 

“Consolidated EBIT
— means, in relation to any Accounting Period of the Group, the consolidated
operating profit of the Group for such Accounting Period calculated by
reference to the Accounts of the Group for such Accounting Period and:

 

(a)           before deducting, charging or providing for:

 

(i)            Consolidated
Net Interest Expense; and

 

(ii)           any taxation as shown in the profit and loss section of
such Accounts for such Accounting Period; and

 

(b)           before
taking into account any exceptional items (including, without limitation,
profits or losses on the sale or termination of an operation, costs of a
fundamental reorganization or restructuring and profits or losses on the
disposal of fixed assets) as shown in the profit and loss section of the
Accounts of the Group for such Accounting Period; and

 

(c)           before taking into account any charge or credit to operating
profit on the SARS Scheme.”

 

 

“Consolidated EBITA
— means, in relation to any Accounting Period of the Group, the consolidated
operating profit of the Group for such Accounting Period calculated by
reference to the Accounts of the Group for such Accounting Period and:

 

(a)           before deducting, charging or providing for:

 

(i)            Consolidated
Net Interest Expense;

 

(ii)           any taxation as shown in the profit and loss section of
such Accounts for such Accounting Period; and

 

(iii)          amortization charged during such Accounting Period; and

 

(b)           before
taking into account any exceptional items (including, without limitation,
profits or losses on the sale or termination of an operation, costs of a
fundamental reorganization or restructuring and profits or losses on the
disposal of fixed assets) as shown in the profit and loss section of the
Accounts of the Group for such Accounting Period; and

 

(c)           before taking into account any charge or credit to operating
profit on the SARS Scheme.”

 

“Consolidated EBITDA
— means, in relation to any Accounting Period of the Group, the consolidated
operating profit of the Group for such Accounting Period calculated by
reference to the Accounts of the Group for such Accounting Period and:

 

(a)           before deducting, charging or providing for:

 

(i)            Consolidated
Net Interest Expense;

 

(ii)           any taxation as shown in the profit and loss section of
such Accounts for such Accounting Period;

 

(iii)          depreciation in respect of such Accounting Period; and

 

(iv)          amortization charged during such Accounting Period; and

 

(b)           before
taking into account any exceptional items (including, without limitation,
profits or losses on the sale or termination of an operation, costs of a
fundamental reorganization or restructuring and profits or losses on the
disposal of fixed assets) as shown in the profit and loss section of the
Accounts of the Group for such Accounting Period; and

 

(c)           before taking into account any charge or credit to operating
profit on the SARS Scheme.”

 

“EBIT —
means, in respect of any Person in relation to any accounting period of such
Person, the operating profit of such Person for such accounting period
calculated by reference to its accounts for such accounting period and:

 

A-2

 

(a)           before deducting, charging or providing for:

 

(i)            Net
Interest Expense; and

 

(ii)           any taxation as shown in the profit and loss section of
such accounts for such accounting period; and

 

(b)           before taking into account
any exceptional items (including, without limitation, profits or losses on the
sale or termination of an operation, costs of a fundamental reorganization or
restructuring and profits or losses on the disposal of fixed assets) as shown
in the profit and loss section of the accounts for such accounting period;
and

 

(c )          before taking into account any charge or credit to operating profit
on the SARS Scheme.”

 

§3           Amendments to
Schedule B of the Existing Note Purchase Agreement.  Schedule B of the Existing Note Purchase
Agreement is hereby amended by adding the following defined term in its
appropriate place in alphabetical order in such Schedule:

 

“SARS Scheme — means the Spirent Stock
Incentive Plan which was approved by Ordinary Resolution of the shareholders of
the Company on June 23, 2004.”

 

A-3

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