Document:

ex1017strt3dtrform10q.htm

Exhibit 10.17

EMPLOYMENT AGREEMENT

AGREEMENT by and between STRATTEC SECURITY CORPORATION, a Wisconsin corporation (the "Company"), and Richard P. Messina (the "Executive"), dated as of the 5th day of May, 2010.

The Board of Directors of the Company (the "Board"), has determined that it is in the best interests of the Company and its shareholders to assure that the Company will have the continued dedication of the Executive, notwithstanding the possibility, threat or occurrence of a Change of Control (as defined below) of the Company.  The Board believes it is imperative to diminish the inevitable distraction of the Executive by virtue of the personal uncertainties and risks created by a pending or threatened Change of Control and to encourage the Executive's full attention and dedication to the Company currently and in the event of any threatened or pending Change of Control, and to provide the Executive with compensation and benefits arrangements upon a Change of Control which ensure that the compensation and benefits expectations of the Executive will be satisfied and which are competitive with those of other corporations.  Therefore, in order to accomplish these objectives, the Board has caused the Company to enter into this Agreement.

NOW, THEREFORE, IT IS HEREBY AGREED AS FOLLOWS:

1.  Certain Definitions.

(a)  The "Effective Date" shall mean the first date during the Change of Control Period (as defined in Section l(b)) on which a Change of Control (as defined in Section 2) occurs.  Anything in this Agreement to the contrary notwithstanding, if a Change of Control occurs and if the Executive's employment with the Company or this Agreement is terminated prior to the date on which the Change of Control occurs, and if it is reasonably demonstrated by the Executive that such termination of employment or of this Agreement (i) was at the request of a third party who has taken steps reasonably calculated to effect a Change of Control or (ii) otherwise arose in connection with or anticipation of a Change of Control, then for all purposes of this Agreement the "Effective Date" shall mean the date immediately prior to the date of such termination of employment or purported termination of this Agreement.

(b)  The "Change of Control Period" shall mean the period commencing on the date hereof and ending on the third anniversary of the date hereof; provided, however, that commencing on the date one year after the date hereof, and on each annual anniversary of such date (such date and each annual anniversary thereof shall be hereinafter referred to as the "Renewal Date"), unless previously terminated, the Change of Control Period shall be automatically extended so as to terminate three years from such Renewal Date, unless at least 60 days prior to the Renewal Date the Company shall give notice to the Executive that the Change of Control Period shall not be so extended.

  

  

  

 

2.  Change of Control.   For the purpose of this Agreement, a "Change of Control" shall mean:

(a)  The acquisition by any individual, entity or group (within the meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934, as amended (the "Exchange Act")) (a "Person") of beneficial ownership (within the meaning of Rule 13d-3 promulgated under the Exchange Act) of 20% or more of either (i) the then outstanding shares of common stock of the Company (the "Outstanding Company Common Stock") or (ii) the combined voting power of the then outstanding voting securities of the Company entitled to vote generally in the election of directors (the "Outstanding Company Voting Securities"); provided, however, that the following acquisitions shall not constitute a Change of Control:  (i) any acquisition directly from the Company, (ii) any acquisition by the Company, (iii) any acquisition by any employee benefit plan (or related trust) sponsored or maintained by the Company or any corporation controlled by the Company or (iv) any acquisition by any corporation pursuant to a transaction which complies with clauses (i), (ii) and (iii) of subsection (c) of this Section 2; or

(b)  Individuals who, as of the date hereof, constitute the Board (the "Incumbent Board") cease for any reason to constitute at least a majority of the Board; provided, however, that any individual becoming a director subsequent to the date hereof whose election, or nomination for election by the Company's shareholders, was approved by a vote of at least a majority of the directors then comprising the Incumbent Board shall be considered as though such individual were a member of the Incumbent Board, but excluding, for this purpose, any such individual whose initial assumption of office occurs as a result of an actual or threatened election contest with respect to the election or removal of directors or other actual or threatened solicitation of proxies or consents by or on behalf of a Person other than the Board; or

(c)  Approval by the shareholders of the Company of a reorganization, merger or consolidation (a "Business Combination"), in each case, unless, following such Business Combination, (i) all or substantially all of the individuals and entities who were the beneficial owners, respectively, of the Outstanding Company Common Stock and Outstanding Company Voting Securities immediately prior to such Business Combination beneficially own, directly or indirectly, more than 60% of, respectively, the then outstanding shares of common stock and the combined voting power of the then outstanding voting securities entitled to vote generally in the election of directors, as the case may be, of the corporation resulting from such Business Combination (including, without limitation, a corporation which as a result of such transaction owns the Company through one or more subsidiaries) in substantially the same proportions as their ownership, immediately prior to such Business Combination of the Outstanding Company Common Stock and Outstanding Company Voting Securities, as the case may be, (ii) no Person (excluding any employee benefit plan (or related trust) of the Company or such corporation resulting from such Business Combination) beneficially owns, directly or indirectly, 20% or more of, respectively, the then outstanding shares of common stock of the corporation resulting from such Business Combination or the combined voting power of the then outstanding voting securities of such corporation except to the extent that such ownership existed prior to the Business Combination and (iii) at least a majority of the members of the board of directors of the corporation resulting from such Business Combination were members of the Incumbent Board at the time of the execution of the initial agreement, or of the action of the Board, providing for such Business Combination; or

  

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(d)  Approval by the shareholders of the Company of (i) a complete liquidation or dissolution of the Company or (ii) the sale or other disposition of all or substantially all of the assets of the Company, other than to a corporation, with respect to which following such sale or other disposition, [a] more than 60% of, respectively, the then outstanding shares of common stock of such corporation and the combined voting power of the then outstanding voting securities of such corporation entitled to vote generally in the election of directors is then beneficially owned, directly or indirectly, by all or substantially all of the individuals and entities who were the beneficial owners, respectively, of the Outstanding Company Common Stock and outstanding Company Voting Securities immediately prior to such sale or other disposition in substantially the same proportion as their ownership, immediately prior to such sale or other disposition, of the Outstanding Company Common Stock and Outstanding Company Voting Securities, as the case may be, [b] less than 20% of, respectively, the then outstanding shares of common stock of such corporation and the combined voting power of the then outstanding voting securities of such corporation entitled to vote generally in the election of directors is then beneficially owned, directly or indirectly, by any Person (excluding any employee benefit plan (or related trust) of the Company or such corporation), except to the extent that such Person owned 20% or more of the Outstanding Company Common Stock or Outstanding Company Voting Securities prior to the sale or disposition, and [c] at least a majority of the members of the board of directors of such corporation were members of the Incumbent Board at the time of the execution of the initial agreement, or of the action of the Board, providing for such sale or other disposition of assets of the Company or were elected, appointed or nominated by the Board.

All references in this section 2 to common stock shall include, to the extent applicable, references to equity interests, and all references in this section 2 to directors or board of directors shall include, to the extent applicable, references to any other applicable management body of a person.

3.  Employment Period.  The Company hereby agrees to continue the Executive in its employ, and the Executive hereby agrees to remain in the employ of the Company subject to the terms and conditions of this Agreement, for the period commencing on the Effective Date and ending on the third an­niversary of such date (the "Employment Period").

  

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4.  Terms of Employment.

(a)  Position and Duties.

(i)  During the Employment Period, [a] the Executive's position (including status, offices, titles and reporting requirements), authority, duties and responsibilities shall be at least commensurate in all material respects with the most significant of those held, exercised and assigned at any time during the 120-day period immediately preceding the Effective Date and [b] the Executive's services shall be performed at the location where the Executive was employed immediately preceding the Effective Date or any office or location less than 35 miles from such location.

(ii)  During the Employment Period, and excluding any periods of vacation and sick leave to which the Executive is entitled, the Executive agrees to devote reasonable attention and time during normal business hours to the business and affairs of the Company and, to the extent necessary to discharge the responsibilities assigned to the Executive hereunder, to use the Executive's reasonable best efforts to perform faithfully and efficiently such responsibilities.  During the Employment Period it shall not be a violation of this Agreement for the Executive to [a] serve on corporate, civic or charitable boards or committees, [b] deliver lectures, fulfill speaking engagements or teach at educational institutions and [c] manage personal investments, so long as such activities do not significantly interfere with the performance of the Executive's responsibilities as an employee of the Company in accordance with this Agreement.  It is expressly understood and agreed that to the extent that any such activities have been conducted by the Executive prior to the Effective Date, the continued conduct of such activities (or the conduct of activities similar in nature and scope thereto) subsequent to the Effective Date shall not thereafter be deemed to interfere with the performance of the Executive's responsibilities to the Company.

(b)  Compensation.

(i)  Base Salary.  During the Employment Period, the Executive shall receive an annual base salary ("Annual Base Salary"), which shall be paid at a monthly rate, at least equal to twelve times the highest monthly base salary paid or payable, including any base salary which has been earned but deferred, to the Executive by the Company and its affiliated companies in respect of the 12-month period immediately preceding the month in which the Effective Date occurs.  During the Employment Period, the Annual Base Salary shall be reviewed no more than 12 months after the last salary increase awarded to the Executive prior to the Effective Date and thereafter at least annually and shall be first increased no more than 12 months after the last salary increase awarded to the Executive prior to the Effective Date and thereafter at least annually by the higher of (x) the average increase (excluding promotional increases) in base salary awarded to the Executive for each of the three full fiscal years (annualized in the case of any fiscal year consisting of less than twelve full months or during which the Executive was employed for less than twelve months) prior to the Effective Date, and (y) the percentage increase (excluding promotional increases) in base salary generally awarded to peer executives of the Company and its affiliated companies for the year of determination.  Any increase in Annual Base Salary shall not serve to limit or reduce any other obligation to the Executive under this Agreement.  Annual Base Salary shall not be reduced after any such increase and the term Annual Base Salary as utilized in this Agreement shall refer to Annual Base Salary as so increased.  As used in this Agreement, the term "affiliated companies" shall include any company controlled by, controlling or under common control with the Company.

  

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(ii)  Annual Bonus.  In addition to Annual Base Salary, the Executive shall be awarded, for each fiscal year ending during the Employment Period, an annual bonus in cash at least equal to the higher of (x) the average of the three highest bonuses paid or payable, including any bonus or portion thereof which has been earned but deferred, to the Executive by the Company and its affiliated companies in respect of the five fiscal years (or such shorter period during which the Executive has been employed by the Company) immediately preceding the fiscal year in which the Effective Date occurs (annualized for any fiscal year during such period consisting of less than twelve full months or with respect to which the Executive has been employed by the Company for less than twelve full months) (the "Average Annual Bonus") and (y) the bonus paid or payable (annualized as described above), including any bonus or portion thereof which has been earned but deferred, to the Executive by the Company and its affiliated companies in respect of the most recently completed fiscal year prior to the Effective Date (the "Recent Annual Bonus" and the higher of subsection (x) and (y) above is referred to herein as the "Annual Bonus").  Each such Annual Bonus shall be paid no later than the end of the third month of the fiscal year next following the fiscal year for which the Annual Bonus is awarded, unless the Executive shall elect to defer the receipt of such Annual Bonus.

(iii)  Incentive, Savings and Retirement Plans.  During the Employment Period, the Executive shall be entitled to participate in all incentive, savings and retirement plans, practices, policies and programs applicable generally to other peer executives of the Company and its affiliated companies, but in no event shall such plans, practices, policies and programs provide the Executive with incentive opportunities (measured with respect to both regular and special incentive opportunities, to the extent, if any, that such distinction is applicable), savings opportunities and retirement benefit opportunities, in each case, less favorable, in the aggregate, than the most favorable of those provided by the Company and its affiliated companies for the Executive under such plans, practices, policies and programs as in effect at any time during the 120-day period immediately preceding the Effective Date or if more favorable to the Executive, those provided generally at any time after the Effective Date to other peer executives of the Company and its affiliated companies.

 

  

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(iv)  Welfare Benefit Plans.  During the Employment Period, the Executive and/or the Executive's family, as the case may be, shall be eligible for participation in and shall receive all benefits under welfare benefit plans, practices, policies and programs provided by the Company and its affiliated companies (including, without limitation, medical, prescription, dental, disability, salary continuance, employee life, group life, accidental death and travel accident insurance plans and programs) to the extent applicable generally to other peer executives of the Company and its affiliated companies, but in no event shall such plans, practices, policies and programs provide the Executive with benefits which are less favorable, in the aggregate, than the most favorable of such plans, practices, policies and programs in effect for the Executive at any time during the 120-day period immediately preceding the Effective Date or, if more favorable to the Executive, those provided generally at any time after the Effective Date to other peer executives of the Company and its affiliated companies.

(v)  Expenses.  During the Employment Period, the Executive shall be entitled to receive prompt reimbursement for all reasonable business expenses incurred by the Executive in accordance with the most favorable policies, practices and procedures of the Company and the affiliated companies in effect for the Executive at any time during the 120-day period immediately preceding the Effective Date or, if more favorable to the Executive, as in effect generally at any time thereafter with respect to other peer executives of the Company and its affiliated companies.

(vi)  Fringe Benefits.  During the Employment Period, the Executive shall be entitled to fringe benefits and, if applicable, use of automobile and payment of related expenses, in accordance with the most favorable plans, practices, programs and policies of the Company and its affiliated companies in effect for the Executive at any time during the 120-day period immediately preceding the Effective Date or, if more favorable to the Executive, as in effect generally at any time thereafter with respect to other peer executives of the Company and its affiliated companies.

(vii)  Office and Support Staff.  During the Employment Period, the Executive shall be entitled to an office or offices of a size and with furnishings and other appointments, and to exclusive personal secretarial and other assistance, at least equal to the most favorable of the foregoing provided to the Executive by the Company and its affiliated companies at any time during the 120-day period immediately preceding the Effective Date or, if more favorable to the Executive, as provided generally at any time thereafter with respect to other peer executives of the Company and its affiliated companies.

(viii)  Vacation.  During the Employment Period, the Executive shall be entitled to paid vacation in accordance with the most favorable plans, policies, programs and practices of the Company and its affiliated companies as in effect for the Executive at any time during the 120-day period immediately preceding the Effective Date or, if more favorable to the Executive, as in effect generally at any time thereafter with respect to other peer executives of the Company and its affiliated companies.

  

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5.  Termination of Employment.

(a)  Death or Disability.  The Executive's employment shall terminate automatically upon the Executive's death during the Employment Period. If the Company determines in good faith that the Disability of the Executive has occurred during the Employment Period (pursuant to the definition of Disability set forth below), it may give to the Executive written notice in accordance with Section 12(b) of this Agreement of its intention to terminate the Executive's employment.  In such event, the Executive's employment with the Company shall terminate effective on the 30th day after receipt of such notice by the Executive (the "Disability Effective Date"), provided that, within the 30 days after such receipt, the Executive shall not have returned to full-time performance of the Executive's duties.  For purposes of this Agreement, "Disability" shall mean the absence of the Executive from the Executive's duties with the Company on a full-time basis for 180 consecutive business days as a result of incapacity due to mental or physical illness which is determined to be total and permanent by a physician selected by the Company or its insurers and acceptable to the Executive or the Executive's legal representative (such agreement as to acceptability not to be unreasonably withheld, delayed or conditioned).

(b)  Cause.  The Company may terminate the Executive's employment during the Employment Period for Cause.  For the sole and exclusive purposes of this Agreement, "Cause" shall mean:

(i)  The willful and continued failure of the Executive to perform substantially the Executive's duties with the Company or one of its affiliates (other than any such failure resulting from incapacity due to physical or mental illness), after a written demand for substantial performance is delivered to the Executive by the Board or the Chief Executive Officer of the Company which specifically identifies the manner in which the Board or Chief Executive Officer reasonably believes that the Executive willfully and continuously failed to perform substantially the Executive's duties and which failure by the Executive has not been cured within 30 days' after receipt of such notice, or

(ii)  The willful engaging by the Executive in illegal conduct or gross misconduct which is materially and demonstrably injurious to the Company.

For purposes of this provision, no act or failure to act, on the part of the Executive, shall be considered "willful" unless it is done, or omitted to be done, by the Executive in bad faith or without reasonable belief that the Executive's action or omission was in the best interests of the Company.  Any act, or failure to act, based upon authority given pursuant to a resolution duly adopted by the Board or upon the instructions of the Chief Executive Officer or a senior officer of the Company or based upon the advice of counsel for the Company shall be conclusively presumed to be done, or omitted to be done, by the Executive in good faith and in the best interests of the Company.  The cessation of employment of the Executive shall not be deemed to be for Cause unless and until there shall have been delivered to the Executive a copy of a resolution duly adopted by the affirmative vote of not less than three-quarters of the entire membership of the Board at a meeting of the Board called and held for such purpose (after reasonable notice is provided to the Executive and the Executive is given an opportunity, together with counsel, to be heard before the Board), finding that, in the good faith opinion of the Board, the Executive is guilty of the conduct described in subparagraph (i) or (ii) above, and specifying the particulars thereof in detail.

  

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(c)  Good Reason.  The Executive's employment may be terminated by the Executive for Good Reason.  For the sole and exclusive purposes of this Agreement, "Good Reason" shall mean:

(i)  The assignment to the Executive of any duties inconsistent in any respect with the Executive's position (including status, offices, titles and reporting requirements), authority, duties or responsibilities as contemplated by Section 4(a) of this Agreement, or any other action by the Company which results in a diminution in such position, authority, duties or responsibilities, excluding for this purpose an isolated, insubstantial and inadvertent action not taken in bad faith and which is remedied by the Company promptly after receipt of notice thereof given by the Executive;

(ii)  Any failure by the Company to comply with any of the provisions of Section 4(b) of this Agreement, other than an isolated, insubstantial and inadvertent failure not occurring in bad faith and which is remedied by the Company promptly after receipt of notice thereof given by the Executive;

(iii)  The Company's requiring the Executive to be based at any office or location other than as provided in Section 4(a)(i)[b] hereof or the Company's requiring the Executive to travel on Company business to a substantially greater extent than required immediately prior to the Effective Date;

(iv)  Any purported termination by the Company of the Executive's employment otherwise than as expressly permitted by this Agreement; or

(v)  Any failure by the Company to comply with and satisfy Section 11(c) of this Agreement.

For purposes of this Section 5(c), any good faith determination of "Good Reason" made by the Executive shall be conclusive.  Anything in this Agreement to the contrary notwithstanding, a termination by the Executive for any reason during the 30 day period immediately following the first anniversary of the Effective Date shall be deemed to be a  termination for Good Reason for all purposes of this Agreement.

  

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(d)  Notice of Termination.  Any termination by the Company for Cause, or by the Executive for Good Reason, shall be communicated by Notice of Termination to the other party hereto given in accordance with Section 12(b) of this Agreement.  For purposes of this Agreement, a "Notice of Termina­tion" means a written notice which (i) indicates the specific termination provision in this Agreement relied upon, (ii) to the extent applicable, sets forth in reasonable detail the facts and circumstances claimed to provide a basis for termination of the Executive's employment under the provision so indicated, and (iii) if the Date of Termination (as defined below) is other than the date of receipt of such notice, specifies the termination date (which date shall be not more than thirty days after the giving of such notice).  The failure by the Executive or the Company to set forth in the Notice of Termination any fact or circumstance which contributes to a showing of Good Reason or Cause shall not waive any right of the Executive or the Company, respectively, hereunder or preclude the Executive or the Company, respectively, from asserting such fact or circumstance in enforcing the Executive's or the Company's rights hereunder.

(e)  Date of Termination.  "Date of Termination" means (i) if the Executive's employment is terminated by the Company for Cause, or by the Executive for Good Reason, the date of receipt of the Notice of Termination or any later date specified therein, as the case may be, (ii) if the Executive's employment is terminated by the Company other than for Cause or Disability, the Date of Termination shall be the date on which the Company notifies the Executive of such termination, and (iii) if the Executive's employment is terminated by reason of death or Disability, the Date of Termination shall be the date of death of the Executive or the Disability Effective Date, as the case may be.

6.  Obligations of the Company upon Termination.

(a)  Good Reason; Other Than for Cause, Death or Disability.  If, during the Employment Period, the Company shall terminate the Executive's employment other than for Cause, death or Disability or the Executive shall terminate employment for Good Reason:

(i)  Subject to Section 9 hereof, the Company shall pay to the Executive in a lump sum in cash within 30 days after the Date of Termination the aggregate of the following amounts:

[a]  The sum of [i] the Executive's Annual Base Salary through the Date of Termination to the extent not theretofore paid, [ii] the product of (x) the higher of the Average Annual Bonus and the Recent Annual Bonus paid or payable, if any, which amount shall be calculated in accordance with section 4(b)(ii) above except that the five or one year period, as applicable, shall end with the most recently completed fiscal year prior to the Date of Termination (such higher amount being referred to as the "Highest Annual Bonus"), and (y) a fraction, the numerator of which is the number of days in the current fiscal year through the Date of Termination, and the denominator of which is 365 and [iii] any accrued vacation pay, in each case to the extent not theretofore paid (the sum of the amounts described in clauses [i], [ii] and [iii] shall be hereinafter referred to as the "Accrued Obligations") and subject to ordinary tax withholding and all required deductions; and

  

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[b]  The amount equal to: (i) two (2) years of Executive's Annual Base Salary as of the Date of Termination plus (ii) the Highest Annual Bonus, subject to ordinary tax withholding and all required deductions; and

(ii)  For a period of two (2) years after the Executive's Date of Termination (such period of time is referred to herein as the "Benefit Period"), the Company shall, to the extent permitted by the terms and conditions of any relevant plan, program or policy, continue paying its normal portion of Executive's medical, dental and health insurance premiums pursuant to the provisions of the Consolidated Omnibus Budget Reconciliation Act ("COBRA"), provided that Executive first timely elects to continue such coverage under COBRA, and subject to any federal COBRA premium subsidies (if any) for which Executive may be eligible; provided, however, that if the Executive becomes reemployed with another employer and is eligible to receive medical or other welfare benefits under another employer provided plan, the medical and other welfare benefits described herein shall be secondary to those provided under such other plan during such applicable period of eligibility.  Additionally, during the Benefit Period, the Company will also continue Employee's life insurance and disability coverage and other benefits (other than the medical and other welfare benefits covered by the foregoing sentence) under the plans, programs, practices and policies described in Section 4(b)(iv) above, to the extent permitted under such applicable plans, programs, practices and policies, and will pay to the Employee the fringe benefits pursuant to Section 4(b)(vi) which have accrued prior to the Date of Termination.

(iii)  The Company shall, at its sole expense as incurred, provide the Executive with outplacement services the scope and provider of which shall be selected by the Executive in his sole discretion; and

(iv)  To the extent not theretofore paid or provided, the Company shall timely pay or provide to the Executive any other amounts or benefits required to be paid or provided or which the Executive is eligible to receive under any plan, program, policy or practice or contract or agreement of the Company and its affiliated companies, including, without limitation, any retirement plan, supplemental retirement plan, deferred compensation plan or other arrangement (such other amounts and benefits shall be hereinafter referred to as the "Other Benefits").

  

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(v)  To the extent not otherwise vested, the Executive shall immediately vest in any compensation previously deferred by the Executive (together with any accrued interest or earnings thereon).

(b)  Death.  If the Executive's employment is terminated by reason of the Executive's death during the Employment Period, this Agreement shall terminate without further obligations to the Executive's legal representatives under this Agreement, other than for payment of Accrued Obligations and the timely payment or provision of Other Benefits.  Accrued Obligations shall be paid to the Executive's estate or beneficiary, as applicable, in a lump sum in cash within 30 days of the Date of Termination.  With respect to the provision of Other Benefits, the term Other Benefits as utilized in this Section 6(b) shall include, without limitation, and the Executive's estate and/or beneficiaries shall be entitled to receive, benefits at least equal to the most favorable benefits provided by the Company and affiliated companies to the estates and beneficiaries of peer executives of the Company and such affiliated companies under such plans, programs, practices and policies relating to death benefits, if any, as in effect with respect to other peer executives and their beneficiaries at any time during the 120-day period immediately preceding the Effective Date or, if more favorable to the Executive's estate and/or the Executive's beneficiaries, as in effect on the date of the Executive's death with respect to other peer executives of the Company and its affiliated companies and their beneficiaries.

(c)  Disability.  If the Executive's employment is terminated by reason of the Executive's Disability during the Employment Period, this Agreement shall terminate without further obligations to the Executive, other than for payment of Accrued Obligations and the timely payment or provision of Other Benefits.  Accrued Obligations shall be paid to the Executive in a lump sum in cash within 30 days of the Date of Termination.  With respect to the provision of Other Benefits, the term Other Benefits as utilized in this Section 6(c) shall include, and the Executive shall be entitled after the Disability Effective Date to receive, disability and other benefits at least equal to the most favorable of those generally provided by the Company and its affiliated companies to disabled executives and/or their families in accordance with such plans, programs, practices and policies relating to disability, if any, as in effect generally with respect to other peer executives and their families at any time during the 120-day period immediately preceding the Effective Date or, if more favorable to the Executive and/or the Executive's family, as in effect at any time thereafter generally with respect to other peer executives of the Company and its affiliated companies and their families.

(d)  Cause; Other than for Good Reason.  If the Executive's employment shall be terminated for Cause during the Employment Period, this Agreement shall terminate without further obligations to the Executive other than the obligation to pay to the Executive his or her Accrued Obligations and the timely payment or provision of Other Benefits, but only to the extent vested or earned and not paid as of the date of termination. In such case, all Accrued Obligations shall be paid to the Executive in a lump sum in cash within 30 days of the Date of Termination.  If the Executive voluntarily terminates employment during the Employment Period, excluding a termination for Good Reason, this Agreement shall terminate without further obligations to the Executive, other than for Accrued Obligations and the timely payment or provision of Other Benefits, but only to the extent vested or earned and not paid as of the date of termination. In such case, all Accrued Obligations shall be paid to the Executive in a lump sum in cash within 30 days of the Date of Termination.  To the extent not otherwise vested, the Executive shall immediately vest in any compensation previously deferred by the Executive (together with any accrued interest or earnings thereon).

  

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7.  Nonexclusivity of Rights.  Nothing in this Agreement shall prevent or limit the Executive's continuing or future participation in any plan, program, policy or practice provided by the Company or any of its affiliated companies and for which the Executive may qualify, nor shall anything herein limit or otherwise affect such rights as the Executive may have under any contract or agreement with the Company or any of its affiliated companies.  Amounts which are vested benefits or which the Executive is otherwise entitled to receive under any plan, policy, practice or program of or any contract or agreement with the Company or any of its affiliated companies at or subsequent to the Date of Termination shall be payable in accordance with such plan, policy, practice or program or contract or agreement except as explicitly modified by this Agreement.

8.  Full Settlement.  The Company's obligation to make the payments provided for in this Agreement and otherwise to perform its obligations hereunder shall not be affected by any set-off, counterclaim, recoupment, defense or other claim, right or action which the Company may have against the Executive or others.  In no event shall the Executive be obligated to seek other employment or take any other action by way of mitigation of the amounts payable to the Executive under any of the provisions of this Agreement and such amounts shall not be reduced whether or not the Executive obtains other employment.  The Company agrees to pay as incurred, to the full extent permitted by law, all legal fees and expenses which the Executive may reasonably incur as a result of any contest (regardless of the outcome thereof) by the Company, the Executive or others of the validity or enforceability of, or liability under, any provision of this Agreement or any guarantee of performance thereof (including as a result of any contest by the Executive about the amount of any payment pursuant to this Agreement), plus in each case interest on any delayed payment at the applicable Federal rate provided for in Section 7872(f)(2)(A) of the Internal Revenue Code of 1986, as amended (the "Code").

9.  Certain Tax Matters.

(a)  Excise Taxes.  If any payments or benefits paid or provided or to be paid or provided to the Executive or for the Executive's benefit pursuant to the terms of this Agreement or otherwise in connection with, or arising out of, employment with the Company or its subsidiaries or the termination thereof (a "Employment Payment" and, collectively, the "Employment Payments") would be subject to the excise tax imposed by section 4999 of the Code (the "Excise Tax"), then the Executive may elect for such Employment Payments to be reduced to one dollar less than the amount that would constitute a "parachute payment" under section 280G of the Code (the "Scaled Back Amount").  Any such election must be in writing and delivered to the Company.  If the Executive does not elect to have Employment Payments reduced to the Scaled Back Amount, the Executive shall be responsible for payment of any Excise Tax resulting from the Employment Payments and the Executive shall not be entitled to a gross-up payment under this Agreement or any other arrangement for such Excise Tax.  If the Employment Payments are to be reduced, they shall be reduced in the following order of priority:  (i) first from cash compensation, (ii) next from equity compensation, then (iii) pro-rated among all remaining Employment Payments and benefits.  Within each such priority category, Employment Payments shall be reduced on a last to be paid, first reduced basis; provided that if there is a question as to which Employment Payments within any of the foregoing categories are to be reduced first, the Employment Payments that will produce the greatest present value reduction in the Employment Payments with the least reduction in economic value provided to the Executive shall be reduced first.

  

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(b)  Code Section 409A.

(i)  To the extent applicable, it is intended that this Agreement and any payment made hereunder shall comply with the requirements of section 409A of the Code or any exemption or exclusion therefrom, and any related regulations or other guidance promulgated with respect to such section by the Internal Revenue Service ("Code section 409A") and shall in all respects be administered in accordance with Code section 409A.  Any provision that would cause this Agreement or any payment hereof to fail to satisfy Code section 409A shall have no force or effect until amended to comply with Code section 409A in the least restrictive manner necessary and without any diminution in the value of the payments to the Executive, which amendment may be retroactive to the extent permitted by Code section 409A.  Notwithstanding anything in this Agreement to the contrary, to the extent that any amount or benefit that would constitute "nonqualified deferred compensation" under Code section 409A would otherwise be payable or distributable hereunder by reason of the Employee's termination of employment, such amount or benefit will not be payable or distributable to the Executive by reason of such circumstance unless (i) the circumstances giving rise to such termination of employment meet any description or definition of "separation from service" in Code section 409A or (ii) the payment or distribution of such amount or benefit would be exempt from the application of Code section 409A by reason of the short-term deferral exemption or otherwise.  If this provision prevents the payment or distribution of any amount or benefit, such payment or distribution shall be made on the date, if any, on which an event occurs that constitutes a Code section 409A-compliant "separation from service."

(ii)  All reimbursements and in-kind benefits provided under this Agreement shall be made or provided in accordance with the requirements of Code section 409A, including, without limitation, that [a] in no event shall reimbursements by the Company under this Agreement be made later than the end of the calendar year next following the calendar year in which the applicable fee and expenses were incurred, [b] the amount of in-kind benefits that the Company is obligated to pay or provide in any given calendar year shall not affect the in-kind benefits that the Company is obligated to pay or provide in any other calendar year; and [c] the Executive's right to have the Company pay or provide such reimbursements and in-kind benefits may not be liquidated or exchanged for any other benefit.

  

13

  

 

(iii)  To the extent the Executive is a "specified employee," as defined in section 409A(a)(2)(B)(i) of the Code and the regulations and other guidance promulgated thereunder and any elections made by the Company in accordance therewith, notwithstanding the timing of payment provided in any other section of this Agreement, no payment, distribution or benefit under this Agreement that constitutes a distribution of nonqualified deferred compensation (within the meaning of Treasury Regulation section 1.409A-1(b)) upon the Executive's "separation from service" (within the meaning of Treasury Regulation section 1.409A-1(h)), after taking into account all available exemptions, that would otherwise by payable during the six-month period after the Executive's separation from service, will not be made during such six-month period, and any such payment, distribution or benefit will instead be paid on the first business day after such six-month period (the "Delayed Payment Date"); provided, however, that if the Executive dies following a separation from service but before the Delayed Payment Date, such amounts shall be paid to the personal representative of the Executive's estate within thirty (30) days following the Executive's death.

10.  Confidential Information; Trade Secrets.

(a)  Confidential Information.  For purposes of this Agreement, "Confidential Information" means confidential information, to the extent it is not a trade secret, that is possessed by or developed for the Company and that relates to the Company's business or technology, including but not limited to computer program object and source codes, business plans and strategies, existing or proposed bids, technical developments, existing or proposed research projects, financial or business projections, investments, marketing plans and strategies, pricing and cost information, negotiations strategies, sales strategies, training information and materials, employee compensation and other employee information, customer or potential customer lists, customer purchasing history, and information generated for customer engagements.  Confidential Information also includes information received by the Company from others which the Company has an obligation to treat as confidential, including information obtained in connection with customer engagements.  Confidential Information shall not include information that is or becomes available to the public through no wrongful act or omission of Executive.  The parties agree that the Company's Confidential Information was  established at great expense and protected as confidential information and provides the Company with a substantial competitive advantage in conducting its business.  The parties further agree that by virtue of the Executive's employment with the Company, Executive will have access to, and be entrusted with, Confidential Information and that the Company would suffer great loss and injury if the Executive would disclose this information or use it to compete with the Company.  Therefore, the Executive agrees that during the term of Executive's employment, and until the first to occur of (i) such time as the Confidential Information becomes generally available to the public through no fault of Executive, (ii) such time as the Confidential Information no longer provides a benefit to the Company or (iii) the second anniversary of the termination of Executive's employment with the Company, Executive will not, directly or indirectly, in any capacity, use or disclose, or cause to be used or disclosed, in any geographic area in which such use or disclosure could harm the Company's business interests, any Confidential Information.  This provision does not prohibit Executive's use of general skills acquired prior to or during employment by the Company, as long as such use does not involve the use or disclosure of Confidential Information or trade secrets.  The restrictions contained in this paragraph apply to Confidential Information regardless of the fact that the Executive may have participated in the discovery and the development of that information.  Executive also agrees and acknowledges that Executive will comply with all applicable laws regarding insider trading or the use of material nonpublic information in connection with the trading of securities.  For purposes of this Section 10, Company shall include any subsidiaries of the Company.  In no event shall an asserted violation of the provisions of this Section 10 constitute a basis for deferring or withholding any amounts otherwise payable to the Executive under this Agreement.

  

14

  

 

(b)  Common Law of Torts and Trade Secrets.  The parties agree that nothing in this Agreement shall be construed to limit or negate the common law of torts or trade secrets where it provides the Company with broader protection than that provided herein.  During the Executive's employment by the Company, Executive shall do what is reasonably necessary to prevent misappropriation or unauthorized disclosure of the Company's trade secrets.  After termination of Executive's employment, Executive shall not use or disclose the Company's trade secrets for as long as they remain trade secrets.

11.  Successors.

(a)  This Agreement is personal to the Executive and without the prior written consent of the Company shall not be assignable by the Executive otherwise than by will or the laws of descent and distribution.  This Agreement shall inure to the benefit of and be enforceable by the Executive's legal representatives.

(b)  This Agreement shall inure to the benefit of and be binding upon the Company and its successors and assigns.

(c)  The Company will require any successor (whether direct or indirect, by purchase, merger, consolidation or otherwise) to all or substantially all of the business and/or assets of the Company to assume expressly and agree to perform this Agreement in the same manner and to the same extent that the Company would be required to perform it if no such succession had taken place.  As used in this Agreement, "Company" shall mean the Company as hereinbefore defined and any successor to its business and/or assets as aforesaid which assumes and agrees to perform this Agreement by operation of law, or otherwise.

 

  

15

  

12.  Miscellaneous.

 

(a)  This Agreement shall be governed by and construed in accordance with the laws of the State of Wisconsin, without reference to principles of conflict of laws.  The captions of this Agreement are not part of the provisions hereof and shall have no force or effect.  This Agreement may not be amended or modified otherwise than by a written agreement executed by the parties hereto or their respective successors and legal representatives.

(b)  All notices and other communications hereunder shall be in writing and shall be given by hand delivery to the other party or by registered or certified mail, return receipt requested, postage prepaid, addressed as follows:

If to the Executive, to his or her address appearing on the records of the Company.

If to the Company:

STRATTEC SECURITY CORPORATION

3333 West Good Hope Road

Milwaukee, WI 53209

Attn:  Chief Executive Officer

or to such other address as either party shall have furnished to the other in writing in accordance herewith.  Notice and communications shall be effective when actually received by the addressee.

(c)  The invalidity or unenforceability of any provision of this Agreement shall not affect the validity or enforceability of any other provision of this Agreement.

(d)  The Company may withhold from any amounts pay­able under this Agreement such Federal, state, local or foreign taxes as shall be required to be withheld pursuant to any applicable law or regulation.

(e)  The Executive's or the Company's failure to insist upon strict compliance with any provision hereof or any other provision of this Agreement or the failure to assert any right the Executive or the Company may have hereunder, including, without limitation, the right of the Executive to terminate employment for Good Reason pursuant to Section 5(c)(i)-(v) of this Agreement, shall not be deemed to be a waiver of such provision or right or any other provision or right of this Agreement.

 

 

  

16

  

(f)  The Executive and the Company acknowledge that, except as may otherwise be provided under any other written agreement between the Executive and the Company, the employment of the Executive by the Company is "at will" and, prior to the Effective Date, the Executive's employment and this Agreement may be terminated by either the Executive or the Company at any time prior to the Effective Date, in which case the Executive shall have no further rights under this Agreement.  From and after the Effective Date this Agreement shall supersede any other agreement between the parties with respect to the subject matter hereof.

IN WITNESS WHEREOF, the Executive has hereunto set the Executive's hand and, pursuant to the authorization from its Board of Directors, the Company has caused these presents to be executed in its name on its behalf, all as of the day and year first above written.

 

/s/ Richard P. Messina                                                    

Richard P. Messina

 

 

STRATTEC SECURITY CORPORATION

 

BY /s/ Harold M. Stratton II                                            

Harold M. Stratton II,

Chairman of the Board

and Chief Executive Officer

17Exhibit 4.3

 

 

 

3 March 2006

as amended and restated on 13 June 2006,

10 July 2006, 31 July 2006,
15 May 2008, 30 October 2009 and 8 January 2010

 

GROUP INTERCREDITOR DEED

 

DEUTSCHE BANK AG, LONDON BRANCH

as
Original Facility Agent and Original Security Trustee

 

THE ORIGINAL SENIOR BORROWERS

 

THE ORIGINAL SENIOR GUARANTORS

 

THE SENIOR LENDERS

 

THE HEDGE COUNTERPARTIES

 

THE INTERGROUP DEBTORS

 

and

 

THE INTERGROUP CREDITORS

 

 

White
& Case LLP

5 Old Broad Street

London  EC2N 1DW

 

 

TABLE
OF CONTENTS

 

	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  
	
  1.

  	
  INTERPRETATION

  	
  1

  
	
   

  	
  1.1

  	
  Terms Defined

  	
  1

  
	
   

  	
  1.2

  	
  Definitions

  	
  1

  
	
   

  	
  1.3

  	
  References

  	
  9

  
	
   

  	
  1.4

  	
  Construction

  	
  10

  
	
  2.

  	
  PRIORITIES AND SUBORDINATION

  	
  10

  
	
   

  	
  2.1

  	
  Priorities and Subordination

  	
  10

  
	
   

  	
  2.2

  	
  Priorities not affected

  	
  11

  
	
   

  	
  2.3

  	
  Liabilities not affected

  	
  11

  
	
  3.

  	
  UNDERTAKINGS OF THE OBLIGORS

  	
  11

  
	
   

  	
  3.1

  	
  Hedging Liabilities

  	
  11

  
	
   

  	
  3.2

  	
  Intergroup Liabilities

  	
  11

  
	
  4.

  	
  UNDERTAKINGS OF THE CREDITORS

  	
  11

  
	
   

  	
  4.1

  	
  Hedge Counterparties

  	
  11

  
	
   

  	
  4.2

  	
  New Hedging Agreements

  	
  12

  
	
   

  	
  4.3

  	
  Provision of New Hedging Agreements

  	
  12

  
	
   

  	
  4.4

  	
  Obligations of the Intergroup Creditors

  	
  12

  
	
   

  	
  4.5

  	
  Undertakings to the Security Trustee

  	
  12

  
	
   

  	
  4.6

  	
  Undertakings in respect of the HYD Intercreditor Agreement

  	
  13

  
	
  5.

  	
  PERMITTED PAYMENTS

  	
  13

  
	
   

  	
  5.1

  	
  Permitted Payments Prior
  to the Senior Discharge Date

  	
  13

  
	
   

  	
  5.2

  	
  Suspension of Permitted Hedging Payments

  	
  14

  
	
   

  	
  5.3

  	
  Senior Default

  	
  14

  
	
  6.

  	
  TURNOVER

  	
  14

  
	
   

  	
  6.1

  	
  Turnover

  	
  14

  
	
   

  	
  6.2

  	
  Subrogation

  	
  15

  
	
   

  	
  6.3

  	
  Failure of Trusts

  	
  15

  
	
  7.

  	
  ENFORCEMENT

  	
  16

  
	
   

  	
  7.1

  	
  Restrictions on Enforcement by Hedge Counterparties

  	
  16

  
	
   

  	
  7.2

  	
  Restrictions on Enforcement by Additional Senior Finance
  Parties

  	
  17

  
	
   

  	
  7.3

  	
  Permitted Enforcement by Senior Finance Parties

  	
  17

  
	
   

  	
  7.4

  	
  Restrictions on Enforcement by Intergroup Creditors

  	
  18

  
	
   

  	
  7.5

  	
  Permitted Enforcement of Hedging Liabilities

  	
  19

  
	
   

  	
  7.6

  	
  Authorisation to Security Trustee

  	
  21

  
	
   

  	
  7.7

  	
  Release of Security on Enforcement and Disposal after
  Enforcement Action

  	
  22

  
	
   

  	
  7.8

  	
  No New Encumbrances

  	
  23

  
	
   

  	
  7.9

  	
  Disposals

  	
  23

  
	
   

  	
  7.10

  	
  No Enforcement

  	
  23

  
	
   

  	
  7.11

  	
  Manner of Enforcement

  	
  24

  
	
   

  	
  7.12

  	
  Standstill Payments

  	
  24

  
	
  8.

  	
  PROCEEDS OF ENFORCEMENT OF SECURITY

  	
  24

  
	
   

  	
  8.1

  	
  Application of Proceeds of Enforcement of Barclays Security

  	
  24

  
	
   

  	
  8.2

  	
  General Application of Proceeds

  	
  24

  
	
   

  	
  8.3

  	
  Non-cash Distributions

  	
  26

  
	
   

  	
  8.4

  	
  Sums received by an Obligor

  	
  26

  

 

i

 

	
   

  	
  8.5

  	
  Certificates

  	
  26

  
	
   

  	
  8.6

  	
  Conversion of Currencies

  	
  26

  
	
   

  	
  8.7

  	
  Preservation of Liabilities

  	
  26

  
	
  9.

  	
  SUBORDINATION ON INSOLVENCY

  	
  27

  
	
   

  	
  9.1

  	
  Subordination

  	
  27

  
	
   

  	
  9.2

  	
  Filing of claims

  	
  27

  
	
   

  	
  9.3

  	
  Distributions

  	
  27

  
	
   

  	
  9.4

  	
  Voting

  	
  28

  
	
  10.

  	
  RANKING

  	
  28

  
	
   

  	
  10.1

  	
  Ranking of Security

  	
  28

  
	
   

  	
  10.2

  	
  Perfection of Security

  	
  29

  
	
  11.

  	
  ENFORCEMENT OF SECURITY

  	
  29

  
	
   

  	
  11.1

  	
  Enforcement on or before the Senior Discharge Date

  	
  29

  
	
   

  	
  11.2

  	
  Exemption

  	
  30

  
	
  12.

  	
  NEW SENIOR LIABILITIES

  	
  30

  
	
  13.

  	
  PURCHASE OPTION

  	
  31

  
	
  14.

  	
  REINSTATEMENT

  	
  32

  
	
  15.

  	
  APPROPRIATION

  	
  32

  
	
  16.

  	
  POWERS OF ATTORNEY

  	
  32

  
	
   

  	
  16.1

  	
  Appointment by the Creditors

  	
  32

  
	
   

  	
  16.2

  	
  Appointment by the Obligors

  	
  33

  
	
   

  	
  16.3

  	
  Ratification of Acts

  	
  33

  
	
  17.

  	
  COSTS AND EXPENSES

  	
  33

  
	
  18.

  	
  CHANGES TO THE PARTIES

  	
  33

  
	
   

  	
  18.1

  	
  Binding Nature

  	
  33

  
	
   

  	
  18.2

  	
  No Assignment by Obligors

  	
  33

  
	
   

  	
  18.3

  	
  New Creditors

  	
  33

  
	
   

  	
  18.4

  	
  New Parties

  	
  35

  
	
   

  	
  18.5

  	
  Resignation or Removal of Facility Agent, Security Trustee
  or Authorised Representative

  	
  35

  
	
  19.

  	
  PROVISIONS RELATING TO OBLIGORS

  	
  35

  
	
  20.

  	
  NOTICES

  	
  35

  
	
   

  	
  20.1

  	
  Communication of Notices

  	
  35

  
	
   

  	
  20.2

  	
  Delivery of Notices

  	
  35

  
	
  21.

  	
  REMEDIES, WAIVERS & AMENDMENTS

  	
  36

  
	
   

  	
  21.1

  	
  No Waiver

  	
  36

  
	
   

  	
  21.2

  	
  Amendments

  	
  36

  
	
   

  	
  21.3

  	
  Technical Amendments

  	
  37

  
	
   

  	
  21.4

  	
  Priorities between Senior
  Finance Documents

  	
  37

  
	
   

  	
  21.5

  	
  Amended Deed

  	
  37

  
	
  22.

  	
  TERMINATION

  	
  37

  
	
  23.

  	
  ENGLISH LANGUAGE

  	
  37

  
	
  24.

  	
  PARTIAL INVALIDITY

  	
  37

  
	
  25.

  	
  THIRD PARTY RIGHTS

  	
  38

  
	
  26.

  	
  COUNTERPARTS

  	
  38

  
	
  27.

  	
  HEDGING LIABILITIES CONFLICTS

  	
  38

  
	
  28.

  	
  GOVERNING LAW

  	
  38

  
	
  29.

  	
  JURISDICTION

  	
  38

  
	
   

  	
  29.1

  	
  Courts of England

  	
  38

  
	
   

  	
  29.2

  	
  Waiver of Indemnity

  	
  38

  

 

ii

 

	
   

  	
  29.3

  	
  Service of Process

  	
  38

  
	
   

  	
  29.4

  	
  Proceedings in Other Jurisdictions

  	
  39

  
	
   

  	
  29.5

  	
  General Consent

  	
  39

  
	
   

  	
  29.6

  	
  Waiver of Immunity

  	
  39

  
	
  SCHEDULE 1                        DEED OF ACCESSION

  	
  40

  
	
  SCHEDULE 2                        ADDRESS FOR NOTICES

  	
  41

  
	
  SCHEDULE 3                        THE ORIGINAL SENIOR
  BORROWERS AND ORIGINAL SENIOR GUARANTORS

  	
  42

  
	
  SCHEDULE 4                        THE
  EXISTING HEDGE COUNTERPARTIES

  	
  53

  

 

iii

 

THIS
INTERCREDITOR DEED is made on 3 March 2006  as
amended and restated on 13 June 2006, 10 July 2006, 31 July 2006,
15 May 2008, 30 October 2009 and 8 January 2010 between the
following parties:

 

(1)                                  DEUTSCHE
BANK AG, LONDON BRANCH (in its capacity as facility agent for the Senior
Lenders under the Senior Facilities Agreement, the “Original  Facility Agent”);

 

(2)                                  DEUTSCHE
BANK AG, LONDON BRANCH (in its capacity as security trustee under the Senior
Facilities Agreement, the “Original
Security Trustee”);

 

(3)                                  THE
ORIGINAL SENIOR BORROWERS listed in Part I of Schedule 3 (The Original Senior Borrowers) as original borrowers under
the Senior Facilities Agreement (the “Original Senior Borrowers”);

 

(4)                                  THE
ORIGINAL SENIOR GUARANTORS listed in Part II of Schedule 3 (The Original Senior Guarantors) as original borrowers under
the Senior Facilities Agreement (the “Original Senior Guarantors”);

 

(5)                                  THE
SENIOR LENDERS (as defined below);

 

(6)                                  THE
INSTITUTIONS whose names and addresses are set out in Schedule 4 (The Existing Hedge Counterparties) (each in its capacity as
an Existing Hedge Counterparty, an “Existing Hedge
Counterparty”);

 

(7)           THE
INTERGROUP DEBTORS (as defined below); and

 

(8)           THE INTERGROUP
CREDITORS (as defined below).

 

IT
IS AGREED as follows:

 

1.                                     INTERPRETATION

 

1.1                               Terms Defined

 

Terms defined
in the Senior Facilities Agreement or (once the facilities made available under
the Senior Facilities Agreement have been refinanced in full, and all undrawn
commitments thereunder cancelled) the Designated Refinancing Facilities
Agreement (each as defined below) shall have the same meaning when used in this
Deed unless otherwise defined herein.

 

1.2                               Definitions

 

In this
Deed the following terms have the meanings given to them in this Clause.

 

“Additional Liability” means in relation to a Liability, any
present and future liabilities and obligations at any time of all or any of the
Obligors, both actual and contingent and whether incurred solely or jointly or
in any other capacity together with any of the following matters which arises
or is incurred as a result of or in connection with:

 

(a)                                  any deferral, extension,
novation or refinancing of such Liability;

 

(b)                                  any claim for damages, restitution
or otherwise made in connection with such 

 

1

 

Liability;

 

(c)                                  any claim against an Obligor
resulting from a recovery by such Obligor or any other person of a payment or
discharge in respect of such Liability on the grounds of preference or
otherwise;

 

(d)                                  any claim for breach of
representation, warranty or undertaking or an event of default or under an
indemnity or in connection with any other document or agreement evidencing or
constituting any other liability or obligation falling within this definition;
or

 

(e)                                  any amount (such as
post-insolvency interest) which would be included in any of the foregoing but
for any discharge, non-provability, unenforceability or non-allowability of the
same in any insolvency or other proceedings.

 

“Additional Senior Finance Parties” means
any Senior Finance Parties in respect of any Additional Senior Liabilities.

 

“Additional Senior Liabilities” means any
Senior Liabilities which are not outstanding under the Senior Facilities
Agreement or the Designated Refinancing Facilities Agreement.

 

“Authorised Representative” means the
facility agent, trustee or similar representative in respect of any Series of
Senior Liabilities and the Senior Representative, if any.

 

“Barclays” means
Barclays Bank PLC.

 

“Barclays Intercreditor Agreement” means that intercreditor
agreement dated 3 March 2006 and made between Yorkshire Cable
Communications Limited, Sheffield Cable Communications Limited, Yorkshire Cable
Properties Limited, Cable London Limited, Barclays and Deutsche Bank AG, London
Branch as security trustee for the Beneficiaries.

 

“Barclays Liabilities”
has the meaning given to it in the Barclays Intercreditor Agreement.

 

“Barclays Security”
has the meaning given to it in the Barclays Intercreditor Agreement.

 

“Beneficiaries” means the First Beneficiary and the Second
Beneficiaries.

 

“C Facility Liabilities” means all present and future
obligations and liabilities (whether actual or contingent and whether owed
jointly or severally or in any capacity whatsoever) of the Obligors (or any one
or more of them) to the Senior Finance Parties (or any one or more of them) by
way of principal or interest under or in connection with the C Facility
together with any related Additional Liabilities owed to the C Facility Lenders
(as defined in the Senior Facilities Agreement).

 

“Company” means Virgin Media Investment Holdings Limited and
its successors in title from time to time.

 

“Creditors” means the Beneficiaries and the Intergroup Creditors
and any person that becomes party to this Deed in any such capacity pursuant to
Clause 18 (Changes to the Parties).

 

2

 

“Deed of Accession” means a Deed of Accession substantially
in the form set out in Schedule 1 (Deed of Accession)
or in such other form as the Relevant Agent and the Obligors’ Agent shall
agree.

 

“Designated Refinancing Facilities Agreement”
means, upon repayment of all liabilities under the Senior Facilities Agreement
and cancellation of all undrawn commitments thereunder, any Refinancing
Facilities Agreement designated or redesignated as the “Designated Refinancing
Facilities Agreement” by written notice from the Company to the Security
Trustee (with a copy to each Authorised Representative).  Only one agreement at a time may be a
Designated Refinancing Facilities Agreement.

 

“Enforcement Action” has the meaning given to it in
Clause 7.6 (Authorisation to Security
Trustee).

 

“Enforcement Control Event” means when (x) 60
consecutive Business Days have lapsed since both of the following have occurred
at the same time (i) the aggregate outstanding principal amount and
undrawn uncancelled commitments under the Senior Facilities Agreement or, upon
its repayment in full and cancellation of all undrawn commitments thereunder,
the Designated Refinancing Facilities Agreement is less than £1.0 billion and (ii) the
aggregate outstanding principal amount and undrawn commitments under the Senior
Facilities Agreement or, upon its repayment in full and cancellation of all
undrawn commitments thereunder, the Designated Refinancing Facilities Agreement
represents less than 60% (sixty percent) of the aggregate outstanding principal
amount and undrawn commitments under all Senior Liabilities and (y) both
conditions under clauses (i) and (ii) continue to exist on such 60th
Business Day.

 

“Exposure” means, in respect of any Hedge
Counterparty, an amount equal to the aggregate of:

 

(a)                                  in respect of any hedging transaction of
that Hedge Counterparty under any Hedging Agreement that has, as of the date
the calculation is made, been terminated or closed out in accordance with the
terms of this Deed, the amount, if any, payable to it under any Hedging
Agreement in respect of that termination or close out as of the date of
termination or close out (and taking into account any interest accrued on that
amount since the date of termination or close out) to the extent that amount is
unpaid (that amount to be certified by the relevant Hedge Counterparty and as
calculated in accordance with the relevant Hedging Agreement); and

 

(b)                                 in respect of any hedging
transaction of that Hedge Counterparty under any Hedging Agreement that has, as
of the date the calculation is made, not been terminated or closed out, the
amount, if any, which would be payable to it under that Hedging Agreement in
respect of that hedging transaction, if the date on which the calculation is
made was deemed to be an Early Termination Date (as defined in the relevant
Hedging Agreement) for which the relevant Hedging Obligor is the Defaulting
Party (as defined in the relevant Hedging Agreement), that amount to be
certified by the relevant Hedge Counterparty and as calculated in accordance
with the relevant Hedging Agreement.

 

“Facility Agent” means the Original Facility
Agent or its successor or any agent, trustee or other person fulfilling a
similar role under the Senior Facilities Agreement or the Designated
Refinancing Facilities Agreement from time to time.

 

3

 

“Fees” means any fees, expenses, costs or commissions payable
to any of the Senior Finance Parties by any Obligor under or pursuant to any
one or more of the Senior Finance Documents.

 

“Final Discharge Date” means the later of the Senior
Discharge Date and the Hedging Discharge Date.

 

“First Beneficiary” means the Security Trustee to the extent
only of the amounts payable to it in its capacity as such (for its own account)
pursuant to the Senior Finance Documents.

 

“Group” means the Ultimate Parent and its
Subsidiaries from time to time.

 

“Hedge Counterparties” means, collectively, the Existing
Hedge Counterparties and, following their accession to this Deed in accordance
with the provisions of Clause 18.3 (New
Creditors), any New Hedge Counterparties.

 

“Hedging Agreement”
means any and each agreement entered into from time to time between an Obligor
and a Hedge Counterparty in connection with Hedging Arrangements.

 

“Hedging Arrangements”
means any interest rate or currency protection arrangements (whether by way of
interest rate or cross currency swap, cap, collar or otherwise) from time to
time entered into by any Obligor which arrangements hedge the interest rate or
currency exposure of the Group and which are permitted under the Senior
Facilities Agreement or, upon its repayment in full and cancellation of all
undrawn commitments thereunder, the Designated Refinancing Facilities Agreement
and which are documented by one or more Hedging Agreements.

 

“Hedging Discharge Date”
means the date on which each Hedge Counterparty has notified the Security
Trustee that it is satisfied that its Hedging Liabilities have been fully and
finally satisfied and no further Hedging Liabilities can arise under or in
respect of any Hedging Agreement entered into by such Hedge Counterparty.

 

“Hedging Liabilities”
means all present and future Indebtedness and other obligations and liabilities
at any time of all or any of the Obligors whether actual or contingent or
whether owed or incurred solely or jointly or in any other capacity whatsoever
to the Hedge Counterparties (or any one or more of them) under or in connection
with any Hedging Agreements together with any related Additional Liabilities
owed to any Hedge Counterparty or Hedge Counterparties and together also with
all costs, charges and expenses incurred at any time by any Hedge Counterparty
or Hedge Counterparties in connection with the protection, preservation or
enforcement of its rights under any Hedging Agreements.

 

“Hedging Obligor”
means any member of the Bank Group that has entered into a Hedging Agreement.

 

“HYD
Intercreditor Agreement” means the intercreditor agreement dated 13 April 2004
between certain of the Obligors, the Senior Finance Parties and the indenture
trustee in respect of the Existing High Yield Notes as the same may otherwise
be amended, supplemented, novated or restated from time to time.

 

4

 

“Indebtedness” means any obligation (whether incurred as a
principal or as a surety) for the payment or repayment of money, whether
present or future, actual or contingent (including interest and other charges
relating to it).

 

“Insolvency Event” means any event whereby:

 

(a)                                  any Obligor makes a general
assignment for the benefit of or a composition with its creditors generally or
a general moratorium is declared in respect of the Indebtedness of such
Obligor;

 

(b)                                  a resolution is passed or an
order is made for the winding-up, dissolution or administration of an Obligor
or for the appointment of a liquidator, receiver, administrator, administrative
receiver, conservator, custodian, trustee or similar officer of it or of any or
all of its revenues and assets; or

 

(c)                                  any event occurs which, under
the laws of any jurisdiction, has a similar or analogous effect to any of those
events mentioned in paragraphs (a) and (b) above.

 

“Instructing Party” means:

 

(a)                                 prior to the Senior Discharge
Date:

 

(i)                                    prior to an Enforcement
Control Event, the Instructing Group (as defined in the Senior Facilities
Agreement or, upon its repayment in full and cancellation of all undrawn
commitments thereunder, the Designated Refinancing Facilities Agreement); or

 

(ii)                                upon an Enforcement Control
Event, the Senior Finance Parties representing a majority of the aggregate
outstanding principal amount and undrawn uncancelled commitments under the
Senior Finance Documents at the relevant date of determination; and

 

(b)                                 at any time from (and
including) the Senior Discharge Date but prior to the Hedging Discharge Date,
such Hedge Counterparties whose aggregate Exposure represents not less than 662/3% (sixty-six and two-thirds percent) of the aggregate
Exposure of all Hedge Counterparties at the relevant date of determination.

 

“Intergroup Creditor” means:

 

(a)                                  as at the date of this Deed,
each member of the Group that is a creditor in respect of any Intergroup
Liabilities of any Obligor; and

 

(b)                                  at any time hereafter, each
person who becomes a creditor in respect of any Intergroup Liabilities and who
accedes to this Deed in the capacity of an Intergroup Creditor by its execution
and delivery of a Deed of Accession.

 

“Intergroup Debtor” means:

 

(a)                                  as at the date of this Deed,
any Obligor that is a debtor in respect of any Intergroup Liabilities; and

 

5

 

(b)                                  at any time hereafter, each
person who becomes a debtor in respect of any Intergroup Liabilities and who
accedes to this Deed in the capacity of an Intergroup Debtor by its execution
and delivery of a Deed of Accession.

 

“Intergroup  Liabilities”
means all present and future obligations constituted by Indebtedness owed by
any Intergroup Debtor to any Intergroup Creditor together with any related
Additional Liabilities owed to any Intergroup Creditor and together also with
all costs, charges and expenses incurred by any Intergroup Creditor in
connection with the protection, preservation or enforcement of its rights in
respect of such amounts.

 

“Liabilities” means any one or more of the Senior
Liabilities, the Hedging Liabilities and the Intergroup Liabilities
collectively, and “Liability”
means any of them.

 

“New Hedge Counterparty”
means each party to a Hedging Agreement which has acceded to this Deed as a
Hedge Counterparty in accordance with the provisions of Clause 18.3 (New Creditors) and “New Hedge Counterparties”
means all such parties.

 

“New Intermediate Holdco”
means a limited liability company incorporated in England and Wales that is a
direct wholly-owned subsidiary of the Company to which all Subsidiaries of VMIH
(other than any finance subsidiary) are transferred.

 

“New
Senior Liabilities” shall have the meaning given to such term in
Clause 12 (New Senior Liabilities)
(excluding, for the avoidance of doubt, any credit exposure of a Senior Finance
Party, if any, in its capacity as a Hedge Counterparty, if applicable).

 

“Obligors” means the Original Senior Borrowers, the Original
Senior Guarantors and any debtor or grantor of guarantees and/or security in
respect of the Senior Facilities Agreement, any Refinancing Facilities
Agreement or any other Senior Finance Document.

 

“Obligors’ Agent” means the Company in its capacity as agent
pursuant to Clause 30.18 (Obligors’ Agent)
of the Senior Facilities Agreement, or any person acting in a corresponding
capacity pursuant to any Designated Refinancing Facilities Agreement.

 

“Parent” means Virgin Media Finance PLC and
its successors in title from time to time.

 

“Permitted Hedging Payments” means, subject to Clause 9
(Subordination on Insolvency), any
payments, receipts and set offs in respect of Hedging Liabilities (including
all amounts payable as a result of any early termination or close out of any
Hedging Arrangements), but only to the extent that any such payment has fallen
due under or in connection with the terms of the relevant Hedging Agreement or
otherwise by mutual agreement of the parties thereto.

 

“Permitted Payments” means any payment that (i) is
a Permitted Payment (as defined in the Senior Facilities Agreement or, upon its
repayment in full and cancellation of all undrawn commitments thereunder, the
Designated Refinancing Facilities Agreement) or any other payment permitted
under Clause 25.5 (Dividends,
Distributions and Share Capital) of the Senior Facilities Agreement,
or the corresponding provision in the Designated Refinancing Facilities Agreement,
and (ii) is otherwise permitted under the Senior Finance Documents.

 

“Priority Creditors” means the Senior
Finance Parties and the Hedge Counterparties.

 

“Priority Liabilities” means the Senior
Liabilities and the Hedging Liabilities.

 

6

 

“Prohibited Actions” means in relation to an Intergroup
Liability:

 

(i)                                     the payment, repayment or
purchase of such Intergroup Liability or any part thereof;

 

(ii)                                  the discharge by way of set-off,
combination of accounts or other similar action with respect to such Intergroup
Liability or any part thereof unless effected pursuant to any mandatory
requirement of applicable law;

 

(iii)                               the creation of any
Encumbrance over any or all of the assets or revenues of the Intergroup Debtor
in respect of such Intergroup Liability;

 

(iv)                              the giving of a guarantee or
other assurance against financial loss in respect of such Intergroup Liability;

 

(v)                                 any action whereby the
priority as to payment of such Intergroup Liability under this Deed is altered;
or

 

(vi)                              any action prohibited in
accordance with Clause 7.4 (Restrictions on
Enforcement by Intergroup Creditors).

 

“Receiver”  means any administrator,
administrative receiver, receiver and manager or other receiver, whether
appointed pursuant to any Security Document, pursuant to any statute, by a
court or otherwise, of all or any of the proceeds of the Liabilities.

 

“Refinancing Facilities Agreement” means any
agreement under which debt facilities are made available for the refinancing of
the facilities made available under the Senior Facilities Agreement or any
Designated Refinancing Facilities Agreement and which is designated as such by
the Company by notice to the Security Trustee and any Relevant Agent, provided
that the aggregate principal amount of such refinancing indebtedness does not
exceed the aggregate principal amount of the Commitments of the Senior Lenders
under the Senior Facilities Agreement or any Designated Refinancing Facilities
Agreement that it is refinancing plus any amount permitted to be incurred under
Clause 12 (New Senior Liabilities).

 

“Relevant Agent” means (i) prior to the Enforcement
Control Event, the Facility Agent and (ii) after the Enforcement Control
Event, the Senior Representative.

 

“Second Beneficiaries” means the Facility Agent, any other
Authorised Representatives, the Senior Finance Parties and the Hedge
Counterparties.

 

“Secured Obligations”  means the Security Trustee
Liabilities, the Senior Liabilities and the Hedging Liabilities.

 

“Security” means the security granted by the Obligors
pursuant to the Security Documents.

 

“Security Documents” means the Security Documents (as defined
in the Senior Facilities Agreement or, upon its repayment in full and
cancellation of all undrawn commitments thereunder, the Designated Refinancing
Facilities Agreement) and any other document executed at any time by any member
of the Group conferring or evidencing any Encumbrance for or in respect of any
of the Priority Liabilities.

 

7

 

“Security Trust Agreement” means the
security trust agreement dated 3 March 2006, made between, amongst others,
the Original Security Trustee, the Original Facility Agent, the Company, and
the Original Obligors (as defined therein) relating to the Security (and/or any
replacement or additional security trust agreement entered into in connection
with any Refinancing Facilities Agreement or other Senior Finance Document).

 

“Security Trustee” means the Original
Security Trustee or its successor (and/or any replacement or additional
security trustee under any Security Trust Agreement).

 

“Security Trustee Liabilities” means the
amounts payable to the Security Trustee referred to in the definition of First
Beneficiary.

 

“Senior Default” means any Event of Default
(as defined in the Senior Facilities Agreement or, upon its repayment in full
and cancellation of all undrawn commitments thereunder, the Designated
Refinancing Facility Agreement) and any event of default (howsoever described)
under any other Senior Finance Document.

 

“Senior Discharge Date” means the first date
on which:

 

(a)                                  none of the Senior Finance
Parties (including any senior finance parties under any Refinancing Facilities
Agreement or other Senior Finance Documents) is under any commitment,
obligation or liability (whether actual or contingent) to make advances or
provide other financial accommodation to any Obligor under any of the Senior
Finance Documents; and

 

(b)                                  all Senior Liabilities
(including any Senior Liabilities under any Refinancing Facilities Agreement or
other Senior Finance Document) have been unconditionally and irrevocably paid
and discharged in full, provided that for these purposes, regard shall not be
had to any unclaimed indemnities, tax gross ups or other similar amounts.

 

“Senior Facilities Agreement” means the senior facilities
agreement dated 3 March 2006 (as amended and restated from time to time)
between inter alia the Ultimate
Parent, the Original Borrowers, the Original Facility Agent, the Original
Security Trustee and the Senior Lenders.

 

“Senior Finance Documents” means (i) the
Relevant Finance Documents (as defined in the Senior Facilities Agreement or,
upon its repayment in full and cancellation of all undrawn commitments
thereunder, the Designated Refinancing Facilities Agreement, or if it is not
defined there, the Finance Documents as defined in the Designated Refinancing
Facilities Agreement), (ii) any Refinancing Facilities Agreement and (iii) any
document evidencing New Senior Liabilities.

 

“Senior Finance Parties” means (i) the
Relevant Finance Parties (as defined in the Senior Facilities Agreement or,
upon its repayment in full and cancellation of all undrawn commitments
thereunder, the Designated Refinancing Facilities Agreement, or if it is not
defined there, the Finance Parties as defined in the Designated Refinancing
Facilities Agreement) and (ii) any other creditor or designated agent
under any of the Senior Finance Documents.

 

“Senior Lenders” means a bank or financial institution or
other person which has become (and remains) a party hereto as a Senior Lender
in accordance with the provisions of 

 

8

 

Clause 18.3
(New Creditors) hereof and in accordance
with the provisions of the Senior Facilities Agreement or any Designated Refinancing
Facilities Agreement.

 

“Senior Liabilities” means all present and
future obligations and liabilities (whether actual or contingent and whether
owed jointly or severally or in any capacity whatsoever, but excluding any
Hedging Liabilities) of the Obligors (or any one or more of them) to the Senior
Finance Parties (or any one or more of them) under or in connection with the
Senior Finance Documents, including, without limitation, any New Senior
Liabilities provided pursuant to Clause 12 (New
Senior Liabilities), together with any related Additional
Liabilities owed to the Senior Finance Parties and together also with all
costs, charges and expenses incurred by each of the Senior Finance Parties in
connection with the protection, preservation or enforcement of its rights under
the Senior Finance Documents, and provided that for the purposes of the
interpretation of the definition of “Senior Liabilities”
in:

 

(i)                                     the Security Documents (other
than the share charge agreement specified in paragraph 2 of Part 4 of
Schedule 4 (Vanilla Initial Security Documents) to
the Senior Facilities Agreement and the assignment of loans dated 31 July 2006
granted by the Parent in favour of the Security Trustee in respect of the
shares of the Company  (the “C Facility Security Documents”)) only, Senior Liabilities
shall not include any C Facility Liabilities (as defined in the Senior
Facilities Agreement); and

 

(ii)                                  the C Facility Security
Documents only, Senior Liabilities shall not include any C Facility Liabilities
other than the liabilities of the Parent under paragraph (b) of Clause
29.1 (Guarantee) and paragraph (b) of
Clause 29.2 (Indemnity) of the Senior
Facilities Agreement.

 

“Senior Representative” means the
representative appointed by the Instructing Party to represent the Senior
Finance Parties after an Enforcement Control Event, which, in the absence of an
appointment by the Instructing Party, shall be the facility agent, trustee or
similar representative of the Series of Senior Liabilities representing
the largest portion of the aggregate outstanding principal amount and undrawn
uncancelled commitments of all Senior Liabilities at the relevant date of
determination.

 

“Series”  means
any series or class of Senior Liabilities outstanding from time to time.  For the avoidance of doubt, all Senior
Liabilities outstanding under the same facilities agreement, note indenture or
other debt agreement shall constitute a single Series unless any tranche
or series under such agreement has different rights in respect of the Security,
in which case such tranche or series shall constitute a separate Series as
the context requires.

 

“Ultimate Parent” means Virgin Media Inc.
and its successors in title from time to time.

 

1.3                               References

 

(a)                                  Any reference in this Deed to
(or to any provisions of or definition contained in) any other document shall
be construed as a reference to this Deed or that provision, definition or
document as in force for the time being and as amended, supplemented, varied
and/or novated from time to time but only to the extent that any such
amendment, supplement, variation and/or novation has been made in accordance
with the terms of this Deed.

 

(b)                                  Any reference in this Deed to
any party to this Deed shall be construed so as to 

 

9

 

include such
party’s and any subsequent successors’ transferees and assigns in accordance
with their respective interests.

 

(c)                                  Any reference in this Deed to
the singular shall include the plural and vice versa and any references to any party
in the plural shall be construed as references to any such party in the
singular for so long as there is no more than one party to this Deed in the
capacity in which such party acts.

 

(d)                                  Any references in this Deed to
the definition of “Designated Refinancing Facilities Agreement” or “Refinancing
Facilities Agreement” or any provisions using such defined term are intended to
be effective following the designation of a Designated Refinancing Facilities
Agreement or Refinancing Facilities Agreement in accordance with the definition
of such term.

 

1.4                               Construction

 

Any reference in this Deed to:

 

“costs”, “charges”,
“remuneration” or “expenses” include any value added, turnover
or similar tax charged in respect thereof.

 

“tax” shall be construed so as to include any tax, levy,
impost, duty or other charge of a similar nature (including any penalty or
interest payable in connection with any failure to pay or any delay in paying
any of the same);

 

a “person” shall be construed as a reference to any person, firm,
company, corporation, government, state or agency of state or any association
or partnership (whether or not having separate legal personality) of two or
more of the foregoing; and

 

the “winding-up”, “dissolution” or
“administration” of a company or corporation
shall be construed so as to include any equivalent or analogous proceedings
under the law of the jurisdiction in which such company or corporation is
incorporated or any jurisdiction in which such company or corporation carries
on business, including the seeking of liquidation, winding-up, reorganisation,
dissolution, administration, arrangement, adjustment, protection from creditors
or relief of debtors.

 

2.                              PRIORITIES
AND SUBORDINATION

 

2.1                       Priorities
and Subordination

 

Each of
the parties to this Deed hereby agrees and acknowledges that, save as expressly
provided to the contrary in this Deed, the following order of priorities shall
apply to the liabilities referred to below which shall be paid and discharged
in the following order:

 

(i)                                    first, the Senior Liabilities
and the Hedging Liabilities pari passu
without any priority amongst themselves; and

 

(ii)                                second, the Intergroup
Liabilities,

 

and
that as between the parties to this Deed such order of priorities shall prevail
irrespective of whether or not an Insolvency Event shall have occurred, so that
before and after the occurrence of an Insolvency Event, but save as expressly
provided to the contrary in this 

 

10

 

Deed, a
liability which ranks after other liabilities in the foregoing order of
priorities shall be subordinate in right of payment to those other liabilities.

 

2.2                          Priorities
not affected

 

The
order of priorities set out in Clause 2.1 (Priorities
and Subordination) shall apply irrespective of (a) the date on
which this Deed or any of the Senior Finance Documents was executed, registered
or notice thereof was given to any person and (b) unless otherwise
provided in this Deed, any reduction or increase in any of the Senior
Liabilities or any amendment or variation of any of their terms.

 

2.3                          Liabilities
not affected

 

Each of the parties to this Deed hereby agrees and
acknowledges that:

 

(a)                                  notwithstanding any term of
this Deed postponing, subordinating or prohibiting the payment of any of the
Liabilities, each such Liability shall remain owing in accordance with its
terms and interest and default interest will accrue accordingly; and

 

(b)                                  no delay in exercising any
rights or remedies under any of the documents regulating any Liability by reason
of any term of this Deed postponing, restricting or prohibiting such exercise
shall operate as a waiver of any of those rights and remedies.

 

3.                                     UNDERTAKINGS
OF THE OBLIGORS

 

3.1                               Hedging Liabilities

 

Until the Senior Discharge Date, except as
the Instructing Party shall previously have consented in writing, no Obligor
will pay, repay or prepay any of the Hedging Liabilities except as contemplated
in Clause 4.1 (Hedge Counterparties).

 

3.2                               Intergroup Liabilities

 

Until
the Final Discharge Date, each Intergroup Debtor undertakes to the Security
Trustee and each of the other Beneficiaries that it shall not take, nor permit
any Intergroup Creditor nor cooperate with any Intergroup Creditor to take the
benefit of, any Prohibited Action in relation to any Intergroup Liability
except as contemplated by Clause 5 (Permitted Payments).

 

4.                                     UNDERTAKINGS
OF THE CREDITORS

 

4.1                               Hedge Counterparties

 

Until the Senior Discharge Date, a Hedge
Counterparty will not demand or receive any payment, prepayment or repayment in
respect of the Hedging Liabilities except:

 

(a)                                  subject to Clause 5.2 (Suspension of Permitted Hedging Payments),
Permitted Hedging Payments;

 

(b)                                  in respect of the proceeds of
the Security distributed by the Security Trustee pursuant to and in accordance
with Clause 8.2 (General Application of
Proceeds);

 

11

 

(c)                                  any demand or receipt
permitted pursuant to Clause 7.5 (Permitted
Enforcement of Hedging Liabilities); or

 

(d)                                  otherwise with the prior
written consent of the Security Trustee (acting on the instructions of the
Instructing Party).

 

4.2                               New Hedging Agreements

 

Each Hedging Obligor and each Hedge
Counterparty agrees that (save as the Instructing Party shall previously have
consented in writing) any Hedging Agreement entered into after the date hereof:

 

(a)                                  shall be in the form of an
Acceptable Hedging Agreement; and

 

(b)                                  will include an Event of
Default (as defined in the Senior Facilities Agreement or, upon its repayment
in full and cancellation of all undrawn commitments thereunder, the Designated
Refinancing Facilities Agreement) as an Event of Default (as defined therein).

 

4.3                               Provision of New Hedging
Agreements

 

Each Hedging Obligor agrees to provide the
Security Trustee with copies of any Hedging Agreements entered into after the
date hereof as soon as reasonably practicable after the execution thereof.

 

4.4                               Obligations of the Intergroup
Creditors

 

Until the Final Discharge Date, each
Intergroup Creditor undertakes to the Security Trustee and each of the other
Beneficiaries that it shall not agree to, or take the benefit of, any
Prohibited Action in relation to any Intergroup Liability except as
contemplated in Clause 5 (Permitted Payments).

 

4.5                               Undertakings to the Security
Trustee

 

Each
Priority Creditor and each Obligor (as the case may be) gives the following
undertakings to the Security Trustee:

 

(a)                                  it shall provide the Security
Trustee with all directions and information as the Security Trustee may
reasonably require for the purposes of carrying out its duties and obligations
under this Deed and the Security Documents;

 

(b)                                  it shall not take any
proceedings or seek to assert any claim against any officer or employee or
agent of the Security Trustee in respect of any claim it might have against the
Security Trustee or in respect of any act or omission of any kind (including
gross negligence or wilful misconduct) by that officer, employee or agent in
relation to any Senior Finance Document; and

 

(c)                                  it shall give notice to the
Security Trustee and each Authorised Representative promptly upon its becoming
aware of the occurrence or remedying of a Senior Default,

 

12

 

and acknowledges that the Security Trustee has entered
into this Deed in reliance on the undertakings set out in this Clause 4.5.

 

4.6                               Undertakings in respect of the
HYD Intercreditor Agreement

 

Notwithstanding anything to the contrary in
the HYD Intercreditor Agreement, each Priority Creditor hereby agrees that only
the Instructing Party shall exercise any rights or powers as the “Instructing
Group” under the HYD Intercreditor Agreement and no Priority Creditors (other
than the Instructing Party) shall exercise or seek to exercise any such rights
or powers or contest, protest or object to any such exercise by the Instructing
Party.

 

5.                                     PERMITTED
PAYMENTS

 

5.1                               Permitted Payments Prior to
the Senior Discharge Date

 

Subject
to Clause 6.1 (Turnover) and
Clause 6.3 (Failure of Trusts):

 

(a)                                 any Intergroup Debtor may pay
in cash to any Intergroup Creditor and any Intergroup Creditor may receive and
retain (or apply in respect of any liability) payments received from any
Intergroup Debtor in respect of any Intergroup Liability:

 

(i)                                    provided that no Senior
Default has occurred and is continuing or is likely to occur as a result
thereof, for the purposes of funding any Permitted Payments; or

 

(ii)                                at any time after the
occurrence of a Senior Default, for the purposes of funding any Permitted
Payments permitted by the provisions of Clause 5.2 (Suspension
of Permitted Hedging Payments);

 

(b)                                  notwithstanding any other term
of this Deed, the Intergroup Liabilities may be:

 

(i)                                   reduced or cancelled in
consideration of the issue of one or more shares or other securities by any
Intergroup Debtor to any Intergroup Creditor or by any waiver of any such
Intergroup Liabilities or by the making of any capital contribution by any
Intergroup Creditor to any Intergroup Debtor;

 

(ii)                               converted into loan stock or
convertible unsecured loan stock or, if so converted, may be converted back
into debt; or

 

(iii)                           discharged in consideration
for the receipt of any cash received pursuant to a Funding Passthrough or any
non-cash asset received pursuant to an Asset Passthrough or pursuant to any
corresponding definition in the Designated Refinancing Facilities Agreement,

 

provided that
where any Intergroup Creditor has granted security to the Security Trustee
pursuant to any Security Document over its right, title and benefit to the
relevant Intergroup Liabilities, any action referred to in sub-paragraphs (i) to
(ii) above shall only be permitted to the extent that the relevant asset
into which the Intergroup Liabilities are converted, or in consideration for
which they are discharged, (if any) are subject to existing Security in favour
of the Security Trustee or will be made subject to Security in favour of the
Security Trustee (in form and substance substantially similar to the existing
Security in favour of the Security Trustee or 

 

13

 

otherwise in
form and substance as may be reasonably required by the Relevant Agent) within
10 Business Days of such conversion.

 

5.2                               Suspension of Permitted
Hedging Payments

 

Subject to Clause 9 (Subordination on Insolvency), no Obligor shall make and no
Hedge Counterparty shall receive any Permitted Hedging Payments if:

 

(a)                                  a Senior Default (other than a
default in respect of any Hedging Arrangement) has occurred and is continuing
20 Business Days after its occurrence and/or the Relevant Agent has taken any
of the steps it is entitled to take by reason of the occurrence of such Senior
Default; or

 

(b)                                  a Senior Default (other than a
default in respect of any Hedging Arrangement) has occurred and a notice is
served on the relevant Obligor and such Hedge Counterparty by the Security
Trustee stating that such Senior Default has occurred and is continuing and
that no Permitted Hedging Payments can be made.

 

Any payments in respect of Hedging
Liabilities made after paragraph (a) of this Clause 5.2 has become
applicable or after a notice in accordance with paragraph (b) of this
Clause 5.2 is served, shall not constitute Permitted Hedging
Payments.  Following the occurrence of
any Senior Default referred to in paragraphs (a) or (b) of this
Clause 5.2, any Hedge Counterparty may suspend any payments due from it to
any Obligor under any Hedging Arrangement to which it is a party.  If the Relevant Agent is satisfied that the
circumstances or the relevant breach which gave rise to the Senior Default
referred to in paragraphs (a) or (b) above no longer apply or has
been cured (as the case may be), it may, by notice to the Obligors’ Agent and
the Hedge Counterparties state that payments may be made in respect of Hedging
Liabilities so as to constitute Permitted Hedging Payments.  Upon receipt of such notice, any Hedge
Counterparties that have suspended payments to any Obligor and any Obligors
that have suspended payments to any Hedge Counterparty, in each case under any
Hedging Arrangement, shall promptly recommence such payments.

 

5.3                               Senior Default

 

Notwithstanding the terms of the Senior
Finance Documents, prior to the Senior Discharge Date after the service of a
notice under Clause 27.17 (Acceleration)
of the Senior Facilities Agreement (or the comparable provision in the
Designated Refinancing Facilities Agreement) or any of the Senior Liabilities
having been accelerated or otherwise declared due and payable prior to their
stated maturity under any other Senior Finance Document, in each case following
the occurrence of a Senior Default, all proceeds of enforcement of the Security
Documents granted by the Obligors shall forthwith be paid or delivered direct
to the Security Trustee for the benefit of the Priority Creditors for
application pursuant to and in accordance with Clause 8.2 (General Application of Proceeds).

 

6.                                     TURNOVER

 

6.1                               Turnover

 

If at
any time prior to the Final Discharge Date:

 

(a)                                  any Hedge Counterparty
receives a payment (including by way of set-off) or 

 

14

 

distribution
in cash or in kind of, or on account of, any Hedging Liabilities other than a
Permitted Hedging Payment;

 

(b)                                  any Hedge Counterparty
receives the proceeds of any enforcement of any Security on account of any
Hedging Liabilities (including by way of set-off or combination of accounts)
unless those proceeds are received pursuant to Clause 8.2 (General Application of Proceeds);

 

(c)                                  any Intergroup Creditor
receives in respect or on account of, any Intergroup Liabilities a payment or
distribution (in cash or in kind) from any Obligor which is not permitted by
Clause 5 (Permitted Payments) and which is
not made in accordance with the provisions of Clause 8.2 (General Application of Proceeds); or

 

(d)                                  any Obligor or its estate or
any liquidator, receiver or like officer consequent upon its winding-up makes
any payment or distribution (in cash or in kind) in respect or on account of
any of the Intergroup Liabilities which is not permitted by Clause 5 (Permitted Payments) or which is not made in accordance with
the provisions of Clause 8.2 (General Application of
Proceeds),

 

the
receiving Creditor will hold the same for and on behalf of and to the order of
the Security Trustee, and pay (after deducting from the amount received or
recovered the costs, liabilities and expenses (if any) incurred by the relevant
Creditor in recovering such amount) and distribute upon demand all such amounts
to the Security Trustee for application in accordance with Clause 8.2 (General Application of Proceeds).

 

6.2                               Subrogation

 

(a)                                  If the Priority Liabilities
are wholly or partially paid out of any proceeds received in respect or on
account of the Intergroup Liabilities owing to one or more of the Intergroup
Creditors, such Intergroup Creditor shall to that extent be subrogated to the
rights of the Priority Creditors in respect of the Priority Liabilities so
paid, including all security for those Priority Liabilities, but no Intergroup
Creditor may exercise those subrogation rights or receive any payments in
respect thereof on or before the Final Discharge Date without the prior written
consent of the Relevant Agent and the Security Trustee.

 

(b)                                  To the extent that any
subrogation contemplated in paragraph (a) above does not occur for any
reason, as between the Obligors and the Intergroup Creditors, the Intergroup
Liabilities will be deemed not to have been reduced or discharged to the extent
of any payment or distribution to the Security Trustee, for the benefit of the
Priority Creditors (or any of them) under Clause 6.1 (Turnover).

 

(c)                                  The Obligors hereby agree that
they shall not exercise any rights of subrogation in relation to any claim they
may have pursuant to this Clause 6.2, under applicable law or otherwise
until after the Final Discharge Date.

 

6.3                               Failure of Trusts

 

If for
any reason any trust which is to arise (pending payment of any amount to the
Security Trustee for the benefit of the Priority Creditors (or any of them))
pursuant to Clause 6.1 (Turnover) or
Clause 8.7 (Preservation of Liabilities) of
this Deed fails or for any reason 

 

15

 

cannot
be given effect to (including without
limitation, by reason of the laws of any jurisdiction in which any property
which is subject to such trust may be situate), the relevant Creditor
will pay to the Security Trustee and the Security Trustee shall hold for and to
the order of the Priority Creditors, for application in accordance with
Clause 8.2 (General Application of Proceeds),
an amount equal to the amount (or as the case may be transfer value of the
relevant property) intended to be so held on trust.

 

7.                                     ENFORCEMENT

 

7.1                               Restrictions on Enforcement by
Hedge Counterparties

 

Save as permitted by Clause 7.5 (Permitted Enforcement of Hedging Liabilities), until the
Senior Discharge Date, each Hedge Counterparty undertakes to the Security
Trustee and each of the other Beneficiaries that it will not:

 

(a)                                  accelerate any of the Hedging
Liabilities or otherwise declare any of the Hedging Liabilities due and payable
prior to its stated maturity whether on an event of default or otherwise;

 

(b)                                  exercise any right to
crystallise, or require the Security Trustee to crystallise, any floating
charge created pursuant to the Security Documents;

 

(c)                                  exercise any right to enforce,
or require the Security Trustee to enforce, any Encumbrance created pursuant to
the Security Documents by sale, possession, appointment of a receiver or
otherwise, or any rights under or pursuant to the provisions of any guarantee
given by any Obligor in relation to all or any part of the Hedging Liabilities;

 

(d)                                  petition for (or vote in
favour of any resolution for) or initiate or support or take any steps with a
view to any insolvency, liquidation, reorganisation, administration or
dissolution proceedings or any voluntary arrangement or assignment for the
benefit of creditors or any similar proceedings involving any Obligor; or

 

(e)                                  exercise the remedy of
foreclosure in respect of any asset the subject of an Encumbrance created
pursuant to any Security Document,

 

provided
that a Hedge Counterparty shall be entitled to at all times and from time to
time to bring legal proceedings against any person solely for the purpose of:

 

(i)                            obtaining injunctive relief
(or any analogous remedy outside England and Wales) to restrain any actual or
putative breach of any Senior Finance Document to which it is a party;

 

(ii)                        obtaining specific performance
(other than specific performance to make a payment) with no claim for damages;
or

 

(iii)                    requesting judicial
interpretation of any provision of any Senior Finance Document to which it is a
party with no claim for damages.

 

16

 

7.2                               Restrictions on Enforcement by
Additional Senior Finance Parties

 

Each of the Additional Senior Finance Parties agrees
that, without the prior written consent of the Relevant Agent or the
Instructing Party, it will not:

 

(a)                                 exercise or seek to exercise any right to
crystallise, or require the Security Trustee to crystallise, any floating
charge created pursuant to the Security Documents;

 

(b)                                 exercise or seek to exercise any right to
enforce, or require the Security Trustee to enforce, any Encumbrance created
pursuant to the Security Documents by sale, possession, appointment of a
receiver, attachment, set-off, execution or otherwise;

 

(c)                                 exercise or seek to exercise the remedy of
foreclosure in respect of any asset the subject of an Encumbrance created
pursuant to any Security Document;

 

(d)                                 petition for (or vote in favour of any
resolution for) or initiate or support or take any steps with a view to any
insolvency, liquidation, reorganisation, administration or dissolution
proceedings or any voluntary arrangements or assignment for the benefit of
creditors or any similar proceedings involving an Obligor;

 

(e)                                 institute or commence, or join with any
person in commencing any action or proceeding with respect to the rights and
remedies described on paragraphs (a) to (d), inclusive, of this Clause
7.2;

 

(f)                                   contest or support any other person in
contesting, in any proceedings, the perfection, priority, validity or
enforceability of all or any part of the Security held by or on behalf of the
Priority Creditors or the validity or enforceability of any of the Priority
Liabilities or of the priorities, rights or duties established by this Deed;

 

(g)                                contest, protest or object to any
enforcement or foreclosure proceeding or action or any other rights and remedies
relating to the Security brought by the Security Trustee or any Senior Lender
under the Senior Finance Documents or object to the forbearance by either the
Security Trustee or the Senior Lenders from bringing or pursuing any
enforcement or foreclosure proceeding or action or any other exercise of any
rights or remedies relating to the Security; or

 

(h)                                take or cause to be taken any action the
purpose or intent of which is, or could be, to interfere, hinder or delay, in
any manner, whether by judicial proceedings or otherwise, any sale, transfer or
other disposition of the Security by the Security Trustee.

 

7.3                               Permitted Enforcement by
Senior Finance Parties

 

Except as otherwise specifically provided in this Deed
and without limitation to the other terms of this Deed, the Senior Finance
Parties shall have all the rights and remedies available to them under the
Senior Finance Documents to which they are a party upon the occurrence of a
Senior Default. Without limiting the generality of the foregoing, each Senior
Finance Party shall have the independent right, exercised in accordance with
the applicable Senior Finance Documents and applicable law, to do any of the
following:

 

(a)                                 demand payment, declare prematurely due and
payable or otherwise seek to accelerate payment of or place on demand all or
any part of the required payment of interest or 

 

17

 

principal
constituting Senior Liabilities owing to such Senior Finance Party, pursuant to
the Senior Finance Documents (other than the Security Documents (in respect of
which only the Security Trustee may take such actions)) to which it is a party;

 

(b)                                 take any action in order to perfect,
preserve or protect its rights in any Security, provided such action shall not
impair the rights of the Security Trustee or any other Priority Creditor;

 

(c)                                 institute suits or legal proceedings or
file any pleadings, objections, motions or agreements against any Obligor (A) under
the terms of the applicable Senior Finance Documents (other than the Security
Documents (in respect of which only the Security Trustee may take such
actions)) for collection of the amounts owing thereunder, (B) to seek
injunctive relief to restrain any actual or putative breach of any Senior
Finance Document (other than any Security Document (in respect of which only
the Security Trustee may take such actions)) or for specific performance or any
other similar remedy, or (C) to assert rights or interests available to
unsecured creditors of the Obligors, including arising under any Insolvency
Event;

 

(d)                                 file any necessary or responsive pleadings
in opposition to any pleading filed by any person objecting to or otherwise
seeking disallowance of the rights of any Senior Finance Party in the Security;
or

 

(e)                                 in the case of any Insolvency Event, file a
claim or statement of interest with respect to the Senior Liabilities,

 

in each case above, to the extent not inconsistent
with the express terms of this Deed, including, without limitation,
Clause 7.2 (Restrictions on Enforcement
by Additional Senior Finance Parties).

 

7.4                               Restrictions on Enforcement by
Intergroup Creditors

 

Until the Final Discharge Date, each Intergroup
Creditor undertakes to the Security Trustee and to each of the Beneficiaries
that it will not:

 

(a)                                  accelerate any of the Intergroup
Liabilities due and payable prior to their stated maturity whether on an event
of default or otherwise (but without prejudice to the ability of the Intergroup
Creditor to demand repayment of the Intergroup Liabilities to give effect to a
Permitted Payment);

 

(b)                                  enforce any of the Intergroup Liabilities
by execution or otherwise or sue for or institute legal proceedings to recover
all or any part of the Intergroup Liabilities;

 

(c)                                  exercise any right to crystallise, or
require the Security Trustee to crystallise, any floating charge created
pursuant to the Security Documents;

 

(d)                                  exercise any right to enforce, or require
the Security Trustee to enforce, any Encumbrance created pursuant to the
Security Documents by sale, possession, appointment of a receiver or otherwise;
or

 

(e)                                  petition for (or vote in favour of any
resolution for) or initiate or support or take any steps with a view to any
insolvency, liquidation, reorganisation, administration or dissolution proceedings
or any voluntary arrangement or assignment for the benefit of 

 

18

 

creditors
or any similar proceedings involving an Obligor.

 

7.5                               Permitted Enforcement of
Hedging Liabilities

 

(a)                                  Notwithstanding the provisions of
Clause 7.1 (Restrictions on Enforcement by Hedge
Counterparties) or any other Clause of this Deed:

 

(i)                                    to the extent it is able to do so under the
relevant Hedging Agreement, a Hedge Counterparty may terminate or close-out in
whole or in part any hedging transaction under the Hedging Agreement prior to
its stated maturity:

 

(A)                              if any Senior Liabilities have been
declared to be due and payable under Clause 27.17 (Acceleration) or due and payable under
Clause 27.18 (Repayment on Demand)
of the Senior Facilities Agreement or any similar or analogous provisions of
any Refinancing Facilities Agreement or other Senior Finance Document or the
Security Trustee or any Senior Finance Party has exercised any right to enforce
any Encumbrance created pursuant to the Security Documents;

 

(B)                                if (x) the obligations of the relevant
Obligor under the Hedging Agreement cease to be Hedging Liabilities which rank pari passu with the Senior Liabilities
under Clause 2.1 (Priorities and
Subordination) or on a pro rata
basis of payment to the other Second Beneficiaries under Clause 8.2 (General Application of Proceeds), (y) this
Deed is amended in contravention of paragraph (c) of Clause 21.2 (Amendments), or (z) such Hedge
Counterparty ceases to be a Priority Creditor in its capacity as a party to a
Hedging Agreement or the Hedging Liabilities in respect of the relevant Hedging
Agreement cease to be Secured Obligations;

 

(C)                                if an Illegality or Tax Event, Tax Event
Upon Merger or a Force Majeure Event (each defined in the 1992 ISDA Master
Agreement or 2002 ISDA Master Agreement, as published by the International
Swaps and Derivatives Association, Inc., as applicable) has occurred in
respect of that Hedging Agreement;

 

(D)                               if an Event of Default has
occurred under either clause 27.6 (Insolvency),
clause 27.7 (Winding-up) or
clause 27.8 (Execution or Distress),
or clause 27.9 (Similar Events)  by reference to clause 27.6 (Insolvency), clause 27.7 (Winding-up) or clause 27.8 (Execution or Distress), of the Senior
Facilities Agreement or the comparable provision in the Designated Refinancing
Facilities Agreement in relation to an Obligor which is party to that Hedging
Agreement;

 

(E)                                 to the extent that that termination or
close-out by the Hedge Counterparty is necessary to comply with any of the
terms of this Deed;

 

(F)                                 if the Instructing Party gives
its prior consent to that termination or close-out being made; or

 

19

 

(G)                                at any time by mutual
agreement of the relevant Obligor unless a Senior Default has occurred and a
notice is served on the relevant Obligor and such Hedge Counterparty by the
Security Trustee stating that such Senior Default has occurred and is
continuing and that no termination or close-out can be made pursuant to this
Clause 7.5(a)(i)(G).

 

(ii)                                if an
Obligor has defaulted on any payment due under a Hedging Agreement (after
allowing any applicable notice or grace periods) and the default has continued
unwaived for more than 10 days after notice of that default has been given to
the Relevant Agent, the relevant Hedge Counterparty:

 

(A)                              may, to the extent it is able to do so
under the relevant Hedging Agreement, terminate or close-out in whole or in
part any hedging transaction under that Hedging Agreement; and

 

(B)                                until such time as the Security Trustee has
given notice to that Hedge
Counterparty that it is exercising any right to enforce any Encumbrance created
pursuant to the Security Documents, shall be entitled to exercise any right it
might otherwise have to sue for, commence or join legal or arbitration
proceedings against the relevant Obligor to recover any Hedging Liabilities due
under that Hedging Agreement; and

 

(iii)                            after the occurrence of an Insolvency Event in relation to any Obligor,
each Hedge Counterparty shall be entitled to exercise any right it may
otherwise have in respect of that Obligor to:

 

(A)                              prematurely close-out or
terminate any Hedging Liabilities of that Obligor;

 

(B)                                make a demand under any
guarantee, indemnity or other assurance against loss given by that Obligor in
respect of any Hedging Liabilities;

 

(C)                                exercise any right of set-off
or take or receive any payment in respect of any Hedging Liabilities of that
Obligor; or

 

(D)                               claim and prove in the liquidation of that
member of the Group for the Hedging Liabilities owing to it,

 

provided
always that, subject to the occurrence of the events and circumstances
specified under either paragraph (a) or (b) of Clause 5.2 (Suspension of Permitted Hedging Payments),
any amounts received in respect of Hedging Liabilities as a result of action
permitted to be taken under this Clause 7.5 shall promptly upon receipt be
paid by the relevant Hedge Counterparty to the Security Trustee for the benefit
of the Beneficiaries to hold upon trust for application in accordance with
Clause 8.2 (General Application of Proceeds)
(and pending such payment to the Security Trustee, the Hedge Counterparty will
save as specified otherwise hold the amount received on trust for the purposes
of this Deed).

 

20

 

(b)                                  Each Hedging Obligor and each Hedge
Counterparty agrees that (save as the Instructing Party shall previously have
consented in writing):

 

(i)                                    if upon termination of any transaction
entered into under a Hedging Agreement effected following an Event of Default
(as defined therein), a settlement amount or other amount falls due from the
relevant Hedge Counterparty to the relevant Obligor, that amount shall be paid
to the Security Trustee and treated as if it were the proceeds of enforcement
of the security conferred by the Security Documents and applied in accordance
with Clause 8.2 (General Application of
Proceeds); and

 

(ii)                                the relevant Hedge Counterparty will
exercise any rights it may have to terminate the hedging transactions under the
Hedging Agreement (unless the Instructing Party otherwise agrees or requires)
as soon as reasonably practicable after the date on which the Relevant Agent
serves a notice confirming that any of the Senior Liabilities have been declared
due and payable under any of the Senior Finance Documents.

 

7.6                               Authorisation to Security
Trustee

 

Subject
to the terms of the Senior Finance Documents, at any time after a Senior
Default has occurred and whilst it is continuing the Security Trustee may take
such steps as it deems necessary or advisable:

 

(i)                                    to perfect or enforce any of the Security
granted in its favour;

 

(ii)                                to effect any disposal or realisation or
enforcement of any of the Liabilities (including by any acceleration thereof);

 

(iii)                            to collect and receive any and all payments
or distributions which may be payable or deliverable in relation to any of the
Liabilities; or

 

(iv)                               otherwise to give effect to the intent of
this Deed,

 

(each, an “Enforcement Action”) provided
always that:

 

(A)                              the Security Trustee may refrain from
enforcing the Security unless and until instructed to do so by the Instructing
Party and no Priority Creditors or Authorised Representative shall contest or
object to any Enforcement Action being brought by the Security Trustee on the
instructions of the Instructing Party and no party shall take or receive any
Security or any proceeds of any Security in connection with the exercise of any
right or remedy (including set off) with respect to the Security other than the
Security Trustee acting on the instructions of the Instructing Party in
accordance with this Deed;

 

21

 

(B)                                the Security Trustee shall have the
exclusive right and the Instructing Party shall have the exclusive right to
instruct the Security Trustee to enforce rights, exercise remedies (including
set-off) and make determinations regarding the release, disposition, or
restrictions with respect to the Security, subject to the provisions of this
Clause 7 and in exercising such rights and remedies, the Security Trustee and
the Instructing Party may enforce the provisions of the Senior Finance
Documents and exercise the remedies thereunder, all in such order and in such
manner as they may determine in the exercise of their sole discretion; and

 

(C)                                subject to paragraph (b) of Clause
7.11 (Manner of Enforcement), if
the Instructing Party instructs the Security Trustee to enforce the Security,
it may do so in such manner as it deems fit, having regard solely to the interests
of the Beneficiaries.  Neither the
Security Trustee, the Relevant Agent nor any other Senior Finance Party shall
be responsible to any other Creditor for any failure to enforce or to maximise
the proceeds of any enforcement, and may cease any such enforcement at any
time.

 

7.7                               Release of Security on
Enforcement and Disposal after Enforcement Action

 

(a)                                  Other than under (and without prejudice to)
the Senior Facilities Agreement or any Refinancing Facilities Agreement, if any
assets are sold or otherwise disposed of (i) by (or on behalf of) the
Security Trustee, (ii) as a result of a sale by an administrator or
liquidator, or (iii) by an Obligor at the request of the Security Trustee
(acting on the instructions of or with the consent of the Instructing Party),
in each case of the foregoing, either as a result of the enforcement of the
Security or a disposal by an Obligor after any Enforcement Action, the Security
Trustee shall be authorised (at the cost of the Obligors) to release those
assets from the Security and is authorised to execute or enter into, on behalf
of and, without the need for any further authority from any of the Priority
Creditors or Obligors:

 

(i)                                    any release of the Security or any other
claim over that asset and to issue any certificates of non-crystallisation of
any floating charge that may, in the absolute discretion of the Security
Trustee, be considered necessary or desirable;

 

(ii)                                if the asset which is disposed of consists
of all of the shares (which are held by an Obligor) in the capital of an
Obligor or any holding company or Subsidiary of that Obligor, any release of
that Obligor or holding company or Subsidiary from all liabilities it may have
to any Priority Creditor or other Obligor, both actual and contingent in its
capacity as a guarantor or borrower (including any liability to any other
Obligor by way of guarantee, contribution, subrogation or indemnity and
including any guarantee or liability arising under or in respect of the Senior
Finance Documents) and a release of any Security granted by that Obligor or
holding company or Subsidiary over any of its assets under any of the Security
Documents; and

 

(iii)                            if the asset which is disposed of consists
of all of the shares (which are held by an Obligor) in the capital of an Obligor
or any holding company or Subsidiary of that Obligor and if the Security
Trustee wishes to dispose of any Liabilities owed by that Obligor, any
agreement to dispose of all or part of those 

 

22

 

Liabilities
on behalf of the relevant Priority Creditors, Obligors or Agents (with the
proceeds thereof being applied as if they were the proceeds of enforcement of
the Security) provided that the Security Trustee shall take reasonable care to
obtain a fair market price in the prevailing market conditions (though the
Security Trustee shall have no obligation to postpone any disposal in order to
achieve a higher price),

 

provided
that (A) no liabilities of the Parent, the Company or any Finance
Subsidiary, in each case in its capacity as a borrower or issuer under any
Senior Finance Documents, may be disposed of or released pursuant to this
Clause 7.7, (B) any asset which is disposed of is released from the claims
of all Priority Creditors, (C) the proceeds of such disposal are applied
in accordance with Clause 8 (Proceeds of
Enforcement of Security) hereof, and (D) no guarantees of any
notes issued by the Parent, the Company or any Finance Subsidiary under an
indenture may be disposed of pursuant to sub-paragraph (iii) above but
may, to the extent applicable, be released pursuant to sub-paragraph (ii) above.

 

(b)                                  No such release under paragraph (a) above
will affect the obligations and/or liabilities of:

 

(i)                                    any other member of the Group to any other
Creditors; or

 

(ii)                                any Intergroup Creditors to any of the
Beneficiaries.

 

7.8                               No New Encumbrances

 

Until the
Senior Discharge Date, no Obligor shall grant or permit any additional
Encumbrances, or take any action to perfect any additional Encumbrances, on any
asset or property to secure any Series of Senior Liabilities unless it has
also granted an Encumbrance on such asset or property to secure all of the
other Series of Senior Liabilities to the extent legally possible and
without undue burden on the Group (excluding limitations or exclusions in the
Security provided to any Series pursuant to the terms of the Senior
Finance Documents in respect of such Series) and has taken all actions to
perfect such Encumbrances. To the extent that the foregoing provisions are not
complied with for any reason, without limiting any other rights and remedies
available to the Security Trustee or other Senior Finance Parties, any amounts
received by any Senior Finance Party in contravention of this Clause 7.8 shall
forthwith be paid to the Security Trustee for the benefit of the Priority
Creditors for application pursuant to and in accordance with Clause 8.2 (General Application of Proceeds)

 

7.9                               Disposals

 

Any disposal of any shares or assets which are subject
to the Security or any release thereof from the Security which is or is to be
effected at any time, other than with respect to Enforcement Action, shall be
effected in accordance with and subject to the provisions of the Senior Finance
Documents.

 

7.10                        No Enforcement

 

Except as otherwise
provided in this Clause 7 (Enforcement),
the Security Trustee may, in accordance with the instructions of the
Instructing Party, refrain from enforcing the security conferred by the
Security as long as it sees fit.

 

23

 

7.11                        Manner of Enforcement

 

(a)                                  If the Security Trustee does
enforce the Security it may do so in such manner as it sees fit and solely
having regard to the interest of the Beneficiaries.  The Security Trustee shall not be responsible
to any Beneficiary for any failure to enforce nor to maximise the proceeds of
any enforcement, and may cease any such enforcement at any time.

 

(b)                                  Neither the relevant Instructing Party
instructing the Security Trustee, nor the Security Trustee itself, shall take
into account the sharing of proceeds under Clause 8 (Proceeds of Enforcement of Security) when determining the
manner of enforcement of Security (and which Security to enforce) and, if it is
determined to enforce any direct Security over shares of one or more members of
the Group (other than shares in the Company and/or New Intermediate Holdco),
the relevant Instructing Party must in good faith believe that doing so will
result in more aggregate proceeds resulting from enforcement of Security (disregarding
the sharing of proceeds under Clause 8 (Proceeds
of Enforcement of Security)) than would be realised solely from
enforcing direct Security over shares in the Company and/or New Intermediate
Holdco alone.  The requirements of this
paragraph (b) are solely for the benefit of the Priority Creditors and no
Obligor shall have any rights under this paragraph (b).

 

7.12                        Standstill Payments

 

Following a
Senior Default, all payments received by any Senior Finance Party to enter into
any standstill agreement or other agreement to delay the taking of any
Enforcement Action shall be shared among all the Senior Finance Parties pro rata based on the aggregate
outstanding principal amount and undrawn commitments with respect to Senior
Liabilities held by such Senior Finance Party.

 

8.                                     PROCEEDS
OF ENFORCEMENT OF SECURITY

 

8.1                               Application of Proceeds of
Enforcement of Barclays Security

 

Without
prejudice to Clause 7.10 (No Enforcement)
and subject to the rights of any preferential creditor, the Beneficiaries
hereby agree that the net proceeds of enforcement of the Security shall,
insofar as those net proceeds relate to any assets the subject of the Barclays
Security, be applied in the following order:

 

FIRST in payment to Barclays of the
Barclays Liabilities; and

 

SECOND in payment to the Security
Trustee to be applied in accordance with and in order of the priority set out
in Clause 8.2 (General Application of
Proceeds).

 

8.2                               General Application of
Proceeds

 

Subject to the rights of any preferential creditor and
the provisions of Clause 8.1 (Application of Proceeds of
Enforcement of Barclays Security) and notwithstanding the terms of
the Security Documents, without prejudice to Clause 7 (Enforcement), the Beneficiaries hereby agree that the net
proceeds of enforcement of the Security shall be paid (together with any sums
paid to the Security Trustee pursuant to Clause 6 (Turnover)
and Clause 9 (Subordination on
Insolvency)) to the Security Trustee for the benefit of the Priority
Creditors 

 

24

 

pursuant to the terms of this Deed shall be applied by
the Security Trustee (or any Receiver on its behalf) in accordance with this
Deed in the following order of priority, in each case, until such amounts have
been repaid and discharged in full:

 

FIRST in or towards payment of a sum equivalent to the
aggregate of the Security Trustee Liabilities, to the First Beneficiary;

 

SECOND in or towards payment of any Fees;

 

THIRD in or towards payment of a sum equivalent to the
aggregate of the Senior Liabilities and the Hedging Liabilities, to the Second
Beneficiaries respectively, which sum will (if insufficient to discharge the
same in full) be paid to such Second Beneficiaries on a pro rata basis without
any priority amongst themselves; and

 

FOURTH in payment to the relevant Obligor(s) or other
person(s) entitled thereto,

 

PROVIDED THAT each C Facility Lender agrees that, to the extent
that (i) the net proceeds of any enforcement of Security and (ii) any
other recoveries and/or proceeds from any Obligor (including without
limitation, pursuant to a demand made under Clause 29 (Guarantee and Indemnity) of the Senior Facilities Agreement)
(other than in the case of sub-paragraph (ii), such other recoveries and/or
proceeds from the Parent and the Company) are to be applied in accordance with
this Clause 8.2, any such proceeds shall be applied in accordance with
this Clause 8.2 until all of the Senior Liabilities (other than the C
Facility Liabilities) (subject, in the case of sub-paragraph (i), to the
proviso in the immediately following paragraph) and the Hedging Liabilities
have been discharged in full, and

 

PROVIDED FURTHER THAT each Priority Creditor agrees
that, to the extent that a Security (or a portion thereof) has not been granted
in favour of any Series of Senior Liabilities incurred after 30 October 2009
or the Senior Finance Documents in respect of such Series limit or exclude
such Security (or a portion thereof) from the collateral securing such Series of
Senior Liabilities, such Series of Senior Liabilities shall not receive
any net proceeds resulting from the enforcement of such Security (or such
portion thereof) that was so limited or excluded.  For the avoidance of doubt,

 

(a)                                  this proviso shall not be
deemed such a limitation or exclusion in relation to the C Facility
Liabilities; and

 

(b)                                 this proviso shall not apply
to the extent (but only to the extent) Security has been granted over a
particular asset under one or more Senior Finance Documents:

 

(i)                                     which Security does not secure
a particular Series of Senior Liabilities; or

 

(ii)                                  the Senior Finance Documents
in respect of a particular Series of Senior Liabilities limit or exclude
such Security from the collateral securing such Series of Senior
Liabilities,

 

(in either case, the “Limited Security”) but other
Security (including for the avoidance of doubt Security that is subsequently
granted and therefore, but for 

 

25

 

this Deed, would rank in priority of payment
subsequent to the Limited Security) has been granted over that asset which does
secure such Series of Senior Liabilities and is not so limited or excluded
from the collateral securing such Series of Senior Liabilities.

 

The Obligors and the Intergroup Creditors acknowledge
and agree to the provisions of Clause 2.1 (Priorities and Subordination) and this Clause 8.2.

 

8.3                               Non-cash Distributions

 

If the Security Trustee receives any distribution
otherwise than in cash in respect of the Intergroup Liabilities from any
Obligor or any other source, the Security Trustee may realise such
distributions as it sees fit and shall apply the proceeds of such realisation
in accordance with Clause 8.2 (General Application of
Proceeds).

 

8.4                               Sums received by an Obligor

 

If an Obligor
receives any sum which, pursuant to any of the Security Documents or this Deed
should have been paid to the Security Trustee, that sum shall be held by such
Obligor on trust for the benefit and on behalf of the Priority Creditors and
shall promptly be paid to the Security Trustee for application in accordance
with this Clause 8.

 

8.5                               Certificates

 

In applying
any moneys received by it under this Deed, the Security Trustee may rely on any
certificate made or given by each Authorised Representative, as to the
existence and amount of any Liabilities owing to any Priority Creditor under
any of the Senior Finance Documents.

 

8.6                               Conversion of Currencies

 

If the Security Trustee receives any amount under this
Deed for any of the Liabilities in a currency other than the currency of the
Priority Liabilities, the Security Trustee may convert such amount into the
currency of the Priority Liabilities at its spot rate of exchange for the
purchase of the relevant currency of the Priority Liabilities with the currency
of the amount received in the London foreign exchange market.

 

8.7                               Preservation of Liabilities

 

None of the Liabilities shall be deemed reduced:

 

(a)                                  by the receipt of any amount by any
Creditor, if and to the extent that, by virtue of the operation of this Deed,
such amount is required to be paid over to (and pending such payment held upon
trust for) the Security Trustee for application and distribution pursuant to
the terms hereof; or

 

(b)                                  by the receipt of any amount by the
Security Trustee pursuant to the terms of this Deed for application pursuant to
the terms hereof,

 

unless and until such amount is actually applied and
distributed by the Security Trustee pursuant to and in accordance with
Clause 8.2 (General Application of Proceeds).

 

26

 

9.                                     SUBORDINATION
ON INSOLVENCY

 

9.1                               Subordination

 

Without
prejudice to any other provision of this Deed, upon the occurrence of an
Insolvency Event, the Intergroup Liabilities will be subordinated in right of
payment to the Senior Liabilities and the Hedging Liabilities.

 

9.2                               Filing of claims

 

(a)                                  Following the occurrence of an Insolvency
Event, until the Final Discharge Date, the Security Trustee may, and is hereby
irrevocably authorised on behalf of each Creditor to:

 

(i)                                    demand, claim, enforce and prove for the
Intergroup Liabilities;

 

(ii)                                file claims and proofs, give receipts and
take any proceedings in respect of filing such claims or proofs and do anything
which the Security Trustee considers necessary or desirable to recover the
Intergroup Liabilities; and

 

(iii)                            receive all distributions of the Intergroup
Liabilities for application in accordance with Clause 8.2 (General Application of Proceeds).

 

(b)                                  If and to the extent that the Security
Trustee is not entitled, or elects not, to take any of the actions mentioned in
paragraph (a) above, each Intergroup Creditor shall be entitled and agrees
to do so, as soon as reasonably practicable following request by the Security
Trustee provided that it shall be entitled to recover and the Security Trustee
agrees to claim on its behalf any resulting costs, expenses and liabilities
(other than any such costs, expenses or liabilities arising by reason of the
gross negligence or wilful misconduct of such Intergroup Creditor) as if such
amounts had been incurred by the Security Trustee.

 

9.3                               Distributions

 

Following the
occurrence of an Insolvency Event, until the Final Discharge Date, each
Intergroup Creditor will:

 

(a)                                  hold all payments and distributions in cash
or in kind received or receivable by it in respect of any Liabilities owed to
it following the occurrence of such Insolvency Event on trust for the Security
Trustee for the benefit of the Priority Creditors for application in accordance
with Clause 8.2 (General Application of
Proceeds);

 

(b)                                  on demand by the Security Trustee, pay an
amount equal to any Intergroup Liabilities received by it following the
occurrence of such Insolvency Event to the Security Trustee for application in
accordance with Clause 8.2 (General Application of
Proceeds);

 

(c)                                  promptly direct the trustee in bankruptcy,
liquidator, assignee or other person distributing the assets of the relevant
Obligor or their proceeds to pay distributions in respect of the Intergroup
Liabilities directly to the Security Trustee; and

 

(d)                                  promptly use its reasonable efforts to
undertake any actions requested by the Security 

 

27

 

Trustee
to give effect to this Clause 9.3.

 

9.4                               Voting

 

(a)                                  Following the occurrence of an Insolvency
Event, until the last to occur of the Senior Discharge Date and the Hedging
Discharge Date:

 

(i)                                    the Security Trustee for the benefit of the
Priority Creditors may, and is hereby irrevocably authorised on behalf of each
Priority Creditor and the Intergroup Creditors to, exercise all powers of
convening meetings, voting and representation in respect of the Intergroup
Liabilities; and

 

(ii)                                the Intergroup Creditors shall promptly
execute and/or deliver to the Security Trustee such forms of proxy and
representation as it may require to facilitate any such action.

 

(b)                                  If and to the extent that the Security
Trustee does not exercise a power under paragraph (a) above, each of the
Intergroup Creditors shall be entitled to exercise that power and agrees that
it shall exercise that power to the extent the Security Trustee (acting on the
instructions of the Instructing Party) directs and in accordance with such
direction.

 

(c)                                  Nothing in this Clause 9.4 entitles
the Security Trustee (or the Instructing Party) to exercise or require any
Intergroup Creditor to exercise a power of voting or representation to waive,
reduce, discharge, extend the due date for repayment of or reschedule any
Intergroup Liabilities.

 

10.                              RANKING

 

10.1                        Ranking of Security

 

(a)                                  Subject to Clause 8 (Proceeds of Enforcement of Security), all existing and
future security conferred by the Security will secure all Senior Liabilities
(to the extent so secured and subject to the provisions of this Deed), the
Security Trustee Liabilities and the Hedging Liabilities regardless of:

 

(i)                                    the date on which the Senior Liabilities,
the Security Trustee Liabilities and the Hedging Liabilities arise;

 

(ii)                                whether the Senior Finance Parties or the
Hedge Counterparties are obliged to advance moneys included in the Senior
Liabilities or the Hedging Liabilities; and

 

(iii)                            any fluctuations in the amount of the
Senior Liabilities, the Security Trustee Liabilities or the Hedging
Liabilities,

 

and any
intermediate discharge of the Senior Liabilities, the Security Trustee
Liabilities or the Hedging Liabilities in whole or in part.

 

(b)                                  Subject to Clause 8 (Proceeds of Enforcement of Security), all existing and
future security conferred by the Security shall rank pari passu as if it had been created simultaneously and as a
continuing security for, and shall not be affected by any 

 

28

 

fluctuations
in, the Secured Obligations.  The
provisions of this Clause 10.1(b) shall apply notwithstanding that
all or any of the Security is void, set aside or otherwise invalid.

 

10.2                        Perfection of Security

 

(a)                                  The Security Trustee agrees to acquire and
acknowledges it holds the Charged Assets (such term as used in this
Clause 10.2 as defined in the Security Trust Agreement) in its possession
or control (or in the possession or control of its agents or representatives)
on behalf of itself and any assignee solely for the purpose of perfecting the
security interest granted under the Senior Finance Documents, subject to the
terms and conditions of this Clause 10.2.

 

(b)                                  The Security Trustee shall have no
obligation whatsoever to the other Priority Creditors to ensure that the
Charged Assets are genuine or owned by any of the Obligors or to preserve
rights or benefits of any Person except as expressly set forth in this Deed.

 

(c)                                  The Security Trustee acting pursuant to
this Clause 10.2 shall not have by reason of the Security Documents, this
Deed or any other document a fiduciary relationship in respect of the Priority
Creditors.

 

(d)                                  Upon the later to occur of the Senior Discharge
Date and the Hedging Discharge Date, the Security Trustee shall deliver the
remaining Charged Assets (if any) (or proceeds thereof) together with any
necessary endorsements to the relevant Obligor if no Senior Liabilities remain
outstanding (in each case, so as to allow such Person to obtain control of such
Charged Assets).  The Security Trustee
further agrees to take all other action reasonably requested by such Person in
connection with such Person’s obtaining a first priority interest in the Charged
Assets or as a court of competent jurisdiction may otherwise direct.

 

11.                              ENFORCEMENT
OF SECURITY

 

The provisions of this Clause 11 shall apply on
an Enforcement Action.

 

11.1                        Enforcement on or before the
Senior Discharge Date

 

(a)                                  Prior to the later to occur of the Senior
Discharge Date and the Hedging Discharge Date and subject to paragraph (e) below,
the Security Trustee shall, to the extent it is entitled then to do so under
the terms of the Security Documents, act in relation to the Security in accordance
with the instructions of the Instructing Party or the Relevant Agent (acting in
accordance with instructions from the Instructing Party).

 

(b)                                  Subject to paragraph (c) below, before
giving any instructions to the Security Trustee to enforce the Security, the
Relevant Agent shall consult with the Security Trustee in good faith, with a
view to co-ordinating their actions, for a period of up to 45 days or such
shorter period as the Relevant Agent may determine (the “Consultation Period”).

 

(c)                                  The Relevant Agent and the Security Trustee
shall not be obliged to consult in accordance with paragraph (b) above if:

 

29

 

(i)                                    the Security has become enforceable as a
result of (A) an Insolvency Event, (B) a Senior Default arising under
Clause 27.1 (Non-payment) of the Senior
Facilities Agreement or any equivalent provision under any other Senior Finance
Document or (C) any other party taking any enforcement action against any
Obligor; and

 

(ii)                                the Relevant Agent determines in good faith
(and notifies the Security Trustee) that to enter into such consultations and
thereby delay the commencement of enforcement of the Security could reasonably
be expected to adversely impact in any material respect:

 

(A)                              their ability to enforce any of the
Security; or

 

(B)                                the realisation proceeds of any enforcement
of the Security.

 

(d)                                  The Security Trustee shall incur no
liability to any Priority Creditor in exercising in good faith any discretion
referred to in this Clause 11.1 or if it acts on the advice of a reputable
and independent investment bank.

 

(e)                                  Save as otherwise provided in this
Clause 11.1 any instructions given to the Security Trustee by a person
entitled to give those instructions will override any conflicting instructions
given by any other parties and the Security Trustee is entitled to rely on and
comply with any such instructions.

 

(f)                                    The Security Trustee and the Facility Agent
shall use reasonable efforts to consult with any Authorised Representative or
any steering committee or other representative, as applicable, in respect of
any Series of Additional Senior Liabilities prior to taking any
Enforcement Actions and provide on a regular basis relevant information on the
status of any ongoing Enforcement Actions.

 

11.2                        Exemption

 

(a)                                  A Senior Finance Party shall not be
responsible to any other Priority Creditors with respect to any instructions
given or not given to the Security Trustee in relation to or in connection with
any of the Security Documents, provided in each case such Senior Finance Party
acts in good faith and in accordance with their obligations under this Deed and
the applicable Senior Finance Documents.

 

(b)                                  None of the Senior Finance Parties shall be
liable for any loss or damage suffered by any Obligor provided such Senior
Finance Party acts in good faith and in accordance with their obligations under
this Deed and the applicable Senior Finance Documents.

 

12.                              NEW SENIOR
LIABILITIES

 

The Company may designate at any time liabilities
incurred by any Obligor under any credit facility or other financial
accommodation as “New Senior Liabilities”
under this Deed (whether to refinance, replace or increase any existing Senior
Liabilities or to constitute any new financial accommodation to any Obligor) by
written notice from the Company to the Security Trustee, provided that the
incurrence of the relevant liabilities complies with the terms of the Senior
Facilities Agreement or, upon its repayment in full and cancellation of all
undrawn commitments thereunder, the Designated Refinancing Facilities
Agreement.

 

30

 

13.                              PURCHASE
OPTION

 

(a)                                  If a Senior Default under the Senior
Facilities Agreement or the Designated Refinancing Facilities Agreement has
occurred and the Security Trustee or the Senior Lenders have begun any formal
step to enforce any guarantee under any Senior Finance Document and/or Security
under any Security Document, the Additional Senior Finance Parties may, at the
expense of such Additional Senior Finance Parties, purchase or procure the
purchase of all (but not part) of the rights and obligations of the Senior
Lenders in connection with the Senior Liabilities under the Senior Facilities
Agreement or the Designated Refinancing Facilities Agreement by way of transfer
under Clause 18 (Changes to the Parties),
upon 10 Business Days’ prior written notice to the Facility Agent.

 

If any
Additional Senior Finance Parties in respect of more than one Series of
Additional Senior Liabilities attempts to exercise the option set out in this
Clause 13 by procuring the service of the notice described above, such right
shall be shared on a pro rata basis among the Series of Additional Senior
Liabilities that have served such notice.

 

(b)                                  Any purchase to be made in accordance with
this Clause 13 shall take effect on the following terms:

 

(i)                                   payment in full in cash of an amount equal
to the outstanding principal amount under the Senior Facilities Agreement or
the Designated Refinancing Facilities Agreement as at the date that amount is
to be paid under the terms of this Clause 13 (and including all accrued
interest, fees and expenses, but not any prepayment fees, other than
LIBOR/EURIBOR break funding costs, if any);

 

(ii)                               payment in full in cash of the amount which
each Senior Lender certifies to be necessary to compensate it for any loss on
account of funds borrowed, contracted for or utilised to fund any amount
included in the Senior Liabilities, resulting from the receipt of that payment
otherwise than on the last day of an Interest Period, as defined in the Senior
Facilities Agreement or the Designated Refinancing Facilities Agreement, in
relation thereto;

 

(iii)                           after the transfer, no Senior Lender (in
their capacity as such) will be under any actual or contingent liability to any
Obligor or any other person under this Deed or any Senior Finance Document for
which it is not holding cash collateral in an amount and established on terms
reasonably satisfactory to it;

 

(iv)                              an indemnity is provided from each of the
purchasing Additional Senior Finance Parties (or from another third party
acceptable to all the Senior Lenders) to the Senior Lenders in respect of all
losses which may be sustained or incurred by any Senior Lender in consequence
of any sum received or recovered by any Senior Lender from any Senior Finance
Party or Obligor, or any other person being required (or it being alleged that
it is required) to be paid back by or clawed back from any Senior Lender for
any reason whatsoever, provided that where it is demonstrated to the reasonable
satisfaction of the Senior Lenders that those losses could not have been
recovered in full by the relevant Senior Lender under the Senior Finance
Documents, had that transfer not been made, that indemnity shall not extend to 

 

31

 

the
shortfall; and

 

(v)                                  the relevant transfer shall be without
recourse to, or warranty from, the Senior Lenders, except that each Senior
Lender shall be deemed to have warranted on the date of that transfer that:

 

(A)                             it is the owner, free from all Encumbrances
and third party interests (other than any arising under the Senior Finance
Documents or by operation of law), of all rights and interests under the Senior
Finance Documents purporting to be transferred by it by that transfer;

 

(B)                               it has the corporate power to effect that
transfer; and

 

(C)                               it has taken all necessary action to
authorise the making by it of that transfer.

 

14.                              REINSTATEMENT

 

In the event
that any of the Priority Liabilities are paid and discharged in full and such
payment or discharge or any part thereof shall subsequently, for whatever
reason, be required to be returned or repaid, all of the provisions of this
Deed shall be fully applicable to such Priority Liabilities then outstanding
until all such Priority Liabilities have been paid and discharged in full.

 

15.                              APPROPRIATION

 

(a)                                  Until the last to occur of the Senior
Discharge Date and the Hedging Discharge Date each of the Senior Finance
Parties (or the Security Trustee or the Relevant Agent on their behalf) may
apply any monies or property received under this Deed against the Senior
Liabilities or the Hedging Liabilities (as the case may be) subject to the
proviso to Clause 8.2 (General Application of
Proceeds) which shall apply to this paragraph (a), mutatis mutandis.

 

(b)                                  Without prejudice to the other provisions
of this Deed, after the Final Discharge Date, each Intergroup Creditor (or the
Security Trustee on their behalf) may apply any monies or property received
under this Deed or for the payment or discharge of the Intergroup Liabilities
against the relevant Intergroup Liabilities.

 

16.                              POWERS OF
ATTORNEY

 

16.1                        Appointment by the Creditors

 

Each Senior
Finance Party, Hedge Counterparty and Intergroup Creditor irrevocably appoints
the Security Trustee (or any Receiver appointed in respect of any of the
Secured Property (or any part of it)), individually as its attorney (in each
case, for the purposes of this Clause 16.1, an “Appointee”) with full power to appoint substitutes and to
delegate, in its name and on its behalf and as its act, deed or otherwise to do
any and every thing which such Creditor (a) has authorised the Appointee
to do under this Deed or (b) is required to do by this Deed but has failed
to do for a period of 10 Business Days after receiving notice from the
Appointee requiring it to do so.  The
parties hereto hereby agree that this authorisation is given to secure the
interests of the parties under this Deed and is hereby irrevocable.

 

32

 

16.2                        Appointment by the Obligors

 

By way of
security for the performance of its obligations hereunder, each of the Obligors
hereby irrevocably appoints the Security Trustee and any Receiver of any
proceeds of Intergroup Liabilities or any part of them and their respective
delegates and sub-delegates, (in each case, for the purposes of this
Clause 16.2, an “Appointee”)
to be its attorney acting severally (or jointly with any other such attorney or
attorneys) and in its name and on its behalf and as its act, deed or otherwise
to do any and every thing which:

 

(a)                                 such Obligor is obliged to do under the
terms of this Deed but has failed to do so for a period of 5 Business Days
after notice from the Appointee to do the same; or

 

(b)                                 whilst any Senior Default is continuing,
such Appointee considers necessary or desirable in order to enable such
Appointee to exercise the rights conferred on it by this Deed  or by law.

 

16.3                        Ratification of Acts

 

Without prejudice to the generality of Clause 16.1
(Appointment by the Creditors) and
Clause 16.2 (Appointment by the
Obligors), each of the Intergroup Creditors and the Obligors hereby
undertakes to the relevant Appointee, that promptly upon request, such party
will ratify and confirm all transactions entered into and other actions by the
Appointee, as the case may be (or any of their substitutes or delegates) in the
proper exercise of any power of attorney granted to it hereunder.

 

17.                              COSTS AND
EXPENSES

 

Clause 38 (Costs and Expenses) of the Senior
Facilities Agreement or the comparable provision of the Designated Refinancing
Facilities Agreement shall apply to this Deed, as if set out herein, mutatis mutandis.

 

18.                              CHANGES TO
THE PARTIES

 

18.1                        Binding Nature

 

This Deed shall be binding on and enure to the benefit
of each party hereto its successors and its or any subsequent successors’
transferees and assigns.

 

18.2                        No Assignment by Obligors

 

None of the rights, benefits and obligations of the
Obligors hereunder shall be capable of being assigned or transferred and each
Obligor undertakes that it will not seek to assign or transfer any of its
rights, benefits or obligations hereunder (except, in the case of any Obligor
in respect of Senior Liabilities only, to the extent permitted by the Senior
Facilities Agreement or, upon the repayment of the Senior Facilities Agreement,
the Designated Refinancing Facilities Agreement).

 

18.3                        New Creditors

 

(a)                                  The parties hereto agree that none of the
Priority Creditors or Intergroup Creditors will, prior to the Final Discharge
Date, assign or transfer to any person the whole or any part of their rights or
obligations in respect of the Priority Liabilities or any of the 

 

33

 

Intergroup
Liabilities unless the assignee or transferee previously or simultaneously
agrees with the other parties hereto to be bound by the provisions of this Deed
as if it were named herein as an original party and subject to the same rights
and obligations, mutatis mutandis, as the Priority
Creditors and Intergroup Creditors and executes and delivers to the Security
Trustee for the benefit of the Priority Creditors:

 

(i)                                    (in the case of a Senior Lender or other
lenders under senior credit facilities providing Senior Liabilities) a Transfer
Deed under and in accordance with the terms of the Senior Facilities Agreement
or such similar deed, agreement or other document with respect to such other
senior credit facilities providing Senior Liabilities; or

 

(ii)                                (in the case of any other person) a Deed of
Accession (provided that, with respect to Senior Liabilities in the form of
notes or similar instruments, only the Authorised Representative in respect
thereof (and not the holders of such notes or similar instruments) shall be
required to execute and deliver a Deed of Accession),

 

with a
copy, in each case, to each Authorised Representative, provided that nothing
herein shall prevent any holder of Senior Liabilities in the form of notes or
similar instruments from disposing of or transferring any of those notes or
similar instruments in accordance with the relevant note indenture or other
document pursuant to which such notes or similar instruments are issued or the
terms and conditions of those notes or similar instruments.

 

(b)                                 If any Obligor
incurs any new Series of Senior Liabilities:

 

(i)                                    the Company shall
give notice to the Security Trustee and each Authorised Representative
identifying the initial aggregate principal amount of such Series and the
name and address of the Authorised Representative in respect thereof; and

 

(ii)                                the Authorised Representative
in respect of such Series (on behalf of the Senior Finance Parties in
respect thereof) shall agree with the other parties hereto to be bound by the
provisions of this Deed as if it were named herein as an original party and
subject to the same rights and obligations, mutatis mutandis, as the existing
Senior Finance Parties and execute and deliver to the Security Trustee for the
benefit of the Senior Finance Parties a Deed of Accession (with a copy to each
Authorised Representative).

 

(c)                                 Upon execution of a New Hedging Agreement,
each New Hedge Counterparty shall accede to this Deed in such capacity by
executing and delivering to the Security Trustee (with a copy to the Relevant
Agent), a Deed of Accession, whereupon it shall become bound by the provisions
of this Deed as if it were named herein as an original party.

 

(d)                                  The parties hereto confirm that any person
becoming a Creditor shall be entitled to the benefit of the provisions
contained herein as if it had been originally named a party hereto.

 

34

 

18.4                        New Parties

 

Each party
hereto (including parties subsequently becoming bound by this Deed) irrevocably
authorises the Relevant Agent to agree on its behalf with any other person
intending to become party hereto as a Senior Finance Party, a Relevant Agent, a
Security Trustee, a New Hedge Counterparty, an Intergroup Debtor, an Intergroup
Creditor or an Obligor to the execution of a Transfer Deed, or a Deed of
Accession or such other applicable document so as to make such person a party
to this Deed and to effect such amendments to this Deed as may be in the
opinion of the Relevant Agent (acting reasonably) necessary for such purpose, provided that any amendment which would materially and
adversely affect any right, or impose or vary any material obligation, of any
of the parties hereto may not be made without the consent of that party.

 

18.5                        Resignation or Removal of
Facility Agent, Security Trustee or Authorised Representative

 

None of the Facility Agent, the Security Trustee or
any Authorised Representative may resign or be removed except as specified in
the Senior Facilities Agreement (or, upon repayment of the Senior Facilities
Agreement, the Designated Refinancing Facilities Agreement), the Security Trust
Agreement or any other applicable Senior Finance Document (as the case may be)
and only if a replacement Facility Agent, Security Trustee or Authorised
Representative agrees with all other parties hereto to become the replacement
agent or trustee under this Deed by the execution of a Deed of Accession.  Notwithstanding the foregoing, the Security
Trustee may be removed and replaced by a vote of the Instructing Party.

 

19.                              PROVISIONS
RELATING TO OBLIGORS

 

Each of the Obligors acknowledge the priorities,
rights and obligations recorded in this Deed and undertakes with each of the
other parties to this Deed to observe the provisions of this Deed at all times
and not to take any action (save as permitted by the Senior Facilities
Agreement) (or, upon repayment of the Senior Facilities Agreement, the
Designated Refinancing Facilities Agreement) which would or would be reasonably
likely to prejudice or otherwise adversely affect the enforcement of such provisions
or do or suffer to be done anything which would be inconsistent with the terms
of this Deed.

 

20.                              NOTICES

 

20.1                        Communication of Notices

 

Each communication to be made hereunder shall be made
in writing and unless otherwise stated shall be made by fax or letter.

 

20.2                        Delivery of Notices

 

Any communication or document to be made or delivered
by one person to another pursuant to this Deed shall (unless that other person
has by 10 Business Days’ prior written notice to the Relevant Agent specified
another address) be made or delivered to that other person at the address
specified in Schedule 2 (Address for Notices)
or, in the case of any other person becoming party hereto after the date hereof
in the Deed of Accession or Transfer Deed or other acceding or amendment and
restatement document executed by it and shall be deemed to have been made or
delivered when dispatched (in the case of any communication made by 

 

35

 

fax) or (in the case of any communication made by
letter) when left at that address or (as the case may be) 5 Business Days after
being deposited in the post, postage prepaid, in an envelope addressed to it at
that address provided that any
communication or document to be made or delivered to the Relevant Agent shall
be effective only when received by the Relevant Agent and then only if the same
is expressly marked for the attention of the department or officer identified
with the signature below (or such other department or officer as the Relevant Agent
shall from time to time specify for this purpose).

 

21.                              REMEDIES,
WAIVERS & AMENDMENTS

 

21.1                        No Waiver

 

No failure to exercise, nor any delay in exercising,
on the part of any Creditor any right or remedy hereunder shall operate as a
waiver thereof, nor shall any single or partial exercise of any right or remedy
prevent any further or other exercise thereof or the exercise of any other
right or remedy.  The rights and remedies
herein provided are cumulative and not exclusive of any rights or remedies provided
by Law.

 

21.2                        Amendments

 

Subject to
Clause 21.3 (Technical Amendments),
the Relevant Agent may, from time to time, agree with the Company to amend this
Deed and any amendments so made shall be binding on all the parties hereto,
provided that any amendment which would:

 

(a)                                  materially and adversely affect any rights
of the Priority Creditors may not be made without the prior written consent of
the Instructing Party, provided that in the case of any such amendments which
would affect the rights of a Series of Senior Liabilities in a way that is
material and adverse relative to one or more other Series, the applicable
consent of such affected Series (as determined pursuant to the Senior
Finance Documents in respect of such Series) shall also be required;

 

(b)                                  impose or vary any obligation on the
Priority Creditors may not be made without the prior written consent of the
Instructing Party, provided that in the case of any such amendment which
imposes or varies the obligations of a Series of Senior Liabilities in a
way that is material and adverse relative to one or more other Series, the
applicable consent of such affected Series (as determined pursuant to the
Senior Finance Documents in respect of such Series) shall also be required;

 

(c)                                  have the effect of (i) changing the pari
passu ranking of the Hedging Liabilities with the Senior Liabilities
under Clause 2.1 (Priorities and
Subordination) or the pro rata basis of payment to the Second
Beneficiaries under Clause 8.2 (General
Application of Proceeds), (ii) changing this Clause 21.2(c) (Amendments) or (iii) the Hedge
Counterparties ceasing to be Priority Creditors or the Hedging Liabilities
ceasing to be a Secured Obligation, in each case, may not be made without the
prior written consent of each Hedge Counterparty adversely affected thereby; or

 

(d)                                  adversely affect any right, or impose or
vary any obligation, of any party hereto other than a Priority Creditor may not
be made without the consent of that party.

 

36

 

All parties to this Deed agree that any
amendment which relates to, or has the effect of, subordinating all or any
portion of any Series of Senior Liabilities to the other Senior
Liabilities shall only require the consent of the Instructing Party and the applicable
consent of such Series being subordinated (as determined pursuant to the
Senior Finance Documents in respect of such Series).

 

21.3        Technical
Amendments

 

Notwithstanding Clause 21.2 (Amendments), the Relevant Agent may
determine administrative matters and make technical amendments arising out of a
manifest error on the face of this Deed, where such amendments would not
prejudice or otherwise be adverse to the position of the Priority Creditors
without reference to the Priority Creditors and without the consent of the
Intergroup Creditors.

 

21.4        Priorities
between Senior Finance Documents

 

Any Senior Finance Document
may be amended, restated, supplemented or otherwise modified from time to time
in accordance with their terms, provided that such amendment, restatement,
supplement or other modification is not inconsistent with the terms of this
Deed.  Notwithstanding anything contained
in this Deed to the contrary, each of the parties to this Deed agrees and acknowledges
that, in the event of any inconsistency between the terms of this Deed and any
Senior Finance Document, the terms of this Deed shall prevail.

 

21.5        Amended
Deed

 

If any amendment is made to this Deed, the
Relevant Agent shall provide a copy of any such amendment (clearly showing the
amendments made) to each of the parties hereto (including any persons which are
parties hereto pursuant to a Transfer Deed, a Deed of Accession or any similar
document) provided that in relation to copies required to be delivered to any
member of the Group, the Relevant Agent’s obligations under this
Clause 21.5 shall be discharged if one copy of any such amendment is
delivered to the Company.

 

22.          TERMINATION

 

This Agreement shall terminate upon the
Final Discharge Date.

 

23.          ENGLISH LANGUAGE

 

Each communication and document made or
delivered by one person to another pursuant to this Deed shall be in the
English language or accompanied by a translation thereof into English certified
(by an officer of the person making or delivering the same) as being a true and
accurate translation thereof.

 

24.          PARTIAL INVALIDITY

 

(a)           If at any time any provision hereof is or becomes illegal, invalid
or unenforceable in any respect under the Law of any jurisdiction, such
illegality, invalidity or unenforceability shall not affect or impair the
legality, validity or enforceability of the remaining provisions hereof or the
legality, validity or enforceability of such provision under the Law of any
other jurisdiction.

 

(b)           Without prejudice to the generality of paragraph (a) above, the
obligations under this 

 

37

 

Deed of any
Obligor that is incorporated in England & Wales shall not extend
beyond a point where they would cause the provisions of Section 678 and/or
679 of the Companies Act 2006 to be infringed.

 

25.          THIRD PARTY RIGHTS

 

It is agreed that otherwise than in
circumstances where the requirements of this Deed with regard to assignments
and transfers are satisfied, a person who is not a party to this Deed shall
have no rights to enforce any of the terms or provisions of this Deed other
than those it would have had if the Contracts (Rights of Third Parties) Act
1999 had not come into force.

 

26.          COUNTERPARTS

 

This Deed may
be executed in any number of counterparts and all of such counterparts taken
together shall be deemed to constitute one and the same instrument.

 

27.          HEDGING LIABILITIES CONFLICTS

 

Notwithstanding
anything contained in this Deed to the contrary, each of the parties to this
Deed agree and acknowledge that, in relation only to the Hedging Liabilities,
in the event of any inconsistency between the terms of this Deed and the HYD
Intercreditor Agreement, the terms of this Deed shall prevail.

 

28.          GOVERNING LAW

 

This Deed is governed by, and shall be
construed in accordance with, English law.

 

29.          JURISDICTION

 

29.1        Courts of
England

 

Each of the
Obligors, the Additional Senior Finance Parties and the Intergroup Creditors
agrees for the benefit of each Priority Creditor that the courts of England
shall have exclusive jurisdiction to hear and determine any suit, action or
proceedings, and to settle any disputes, which may arise out of or in
connection with this Deed (respectively “Proceedings”
and  “Disputes”) and,
for such purposes, irrevocably submits to the jurisdiction of such courts.

 

29.2        Waiver of
Indemnity

 

Each of the
Obligors, the Additional Senior Finance Parties and the Intergroup Creditors
irrevocably waives any objection which it might now or hereafter have to
Proceedings being brought or Disputes settled in the courts of England and
agrees not to claim that any such court is an inconvenient or appropriate
forum.

 

29.3        Service
of Process

 

Each of the
Obligors, the Additional Senior Finance Parties and the Intergroup Creditors
which is not incorporated in England agrees that the process by which any
Proceedings are begun may be served on it by being delivered in connection with
any Proceedings in England, in the case of any Obligor, to the Obligors’ Agent
at its registered office for the time being, and by executing this Deed each
such person accepts such appointment.  If
the appointment or appointments mentioned in this Clause 29.3 cease to be
effective in respect of any of the 

 

38

 

Obligors, the
Additional Senior Finance Parties or the Intergroup Creditors respectively, the
relevant Obligor, Additional Senior Finance Party or Intergroup Creditor shall
immediately appoint a further person in England to accept service of process on
its behalf in England and, failing such appointment within 15 days, the
Relevant Agent shall be entitled to appoint such person by notice to the
relevant Obligor, Additional Senior Finance Party or Intergroup Creditor.  Nothing contained herein shall affect the
right to serve process in any other manner permitted by Law.

 

29.4        Proceedings
in Other Jurisdictions

 

The
submissions to the jurisdiction of the courts of England shall not (and shall
not be construed so as to) limit the right of the Priority Creditors (other
than the Additional Senior Finance Parties) or any of them to take Proceedings
against any of the Obligors, Additional Senior Finance Parties or Intergroup
Creditors in any other court of competent jurisdiction nor shall the taking of
Proceedings in any one or more jurisdictions preclude the taking of Proceedings
in any other jurisdiction (whether concurrently or not) if and to the extent
permitted by applicable Law.

 

29.5        General
Consent

 

Each of the
Obligors, the Additional Senior Finance Parties and the Intergroup Creditors
hereby consents generally in respect of any Proceedings to the giving of any
relief or the issue of any process in connection with such Proceedings
including the making, enforcement or execution against any property whatsoever
(irrespective of its use or intended use) of any order or judgement which may
be made or given in such Proceedings.

 

29.6        Waiver of
Immunity

 

To the extent
that any Obligor, Additional Senior Finance Party or Intergroup Creditor may in
any jurisdiction claim for itself or its assets immunity from suit, execution,
attachment (whether in aid of execution, before judgement or otherwise) or
other legal process and to the extent that in any such jurisdiction there may
be attributed to itself or its assets such immunity (whether or not claimed),
such Obligor, Additional Senior Finance Party or Intergroup Creditor hereby
irrevocably agrees not to claim and hereby irrevocably waives such immunity to
the full extent permitted by the laws of such jurisdiction.

 

IN WITNESS whereof this Deed has been executed and delivered as a deed by the
parties hereto on the day and year first above written.

 

39

 

SCHEDULE 1

DEED OF ACCESSION

 

This Deed of
Accession dated [·] is
supplemental to an intercreditor deed (the “Intercreditor
Deed”) dated 3 March 2006
as amended and restated on 13 June 2006, 10 July 2006, 31 July 2006,
15 May 2008, 30 October 2009 and 8 January 2010 between,
amongst others, the Original Facility Agent, the Original Security Trustee, the
Senior Lenders, the Hedge Counterparties, the Intergroup Creditors, the
Intergroup Debtors and the Obligors (as may be further amended, supplemented,
varied or novated from time to time). 
Terms defined in the Intercreditor Deed shall have the same meaning when
used in this Deed.

 

[Name of new Facility Agent/Security Trustee/Senior
Lender/Authorised Representative/Additional Senior Finance Party/Hedge
Counterparty/Intergroup Debtor and Obligor/Intergroup Creditor]  of [address] hereby agrees with each
other person who is or who becomes a party to the Intercreditor Deed in
accordance with the terms thereof that with effect on and from the date hereof
it will be bound by the Intercreditor Deed as [a Facility Agent/a Security Trustee/a Senior
Lender/an Authorised Representative/an Additional Senior Finance Party/a Hedge
Counterparty/an Intergroup Debtor and Obligor/an Intergroup Creditor]  as if it had
been party to the Intercreditor Deed in such capacity.

 

Address for notices of [name of new Facility Agent
etc.] for the purposes of
Clause 20.2 (Delivery of Notices)
of the Intercreditor Deed is:

 

Address:

 

Telephone
Number:

Facsimile
Number:

[Telex Number:]

 

[We have appointed [                            ] at [                  ] [(being the person named in
Clause 29.3 (Service of Process) of the
Intercreditor Deed as the process agent for each of the other
Obligors/Intergroup Creditors)] as our process agent for the purposes of
service of process pursuant to Clause 29.3 (Service of
Process) of the Intercreditor Deed.]

 

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

 

IN WITNESS whereof this Deed of Accession has been executed as a deed by the
party hereto, and is delivered on the date written above.

 

EXECUTED AND DELIVERED AS
A DEED by

 

[Name of Party]

 

Countersigned in acceptance

 

By:

 

[             ]

 

Relevant Agent

 

40

 

SCHEDULE 2

ADDRESS FOR NOTICES

 

The Obligors’ Agent

 

Virgin Media Investment Holdings Limited

 

	
  Address:

  	
  Bartley Wood
  Business Park

  
	
   

  	
  Hook

  
	
   

  	
  Hampshire
  RG27 9UP

  

 

The Intergroup Creditors and the Intergroup Debtors (as
the case may be)

 

	
  Address:

  	
  Bartley Wood
  Business Park

  
	
   

  	
  Hook

  
	
   

  	
  Hampshire
  RG27 9UP

  

 

Deutsche Bank AG, London
Branch

as Facility Agent on behalf of the Senior
Finance Parties

 

	
  Address:

  	
  Winchester
  House

  
	
   

  	
  1 Great
  Winchester Street

  
	
   

  	
  London EC2N
  2DB

  

 

41

 

SCHEDULE 3

 

THE ORIGINAL SENIOR BORROWERS AND ORIGINAL SENIOR
GUARANTORS

 

Part I
- The Original Senior Borrowers

 

Virgin Media Investment Holdings Limited

 

Telewest
Communications Networks Limited

 

VMIH Sub
Limited

 

Virgin Media
Dover LLC

 

42

 

Part II
- The Original Senior Guarantors

 

	
  NTL

  
	
  Andover Cablevision Limited

  
	
  Anglia Cable Communications Limited

  
	
  Berkhamsted Properties & Building Contractors Limited

  
	
  Cable Television Limited

  
	
  Cable Thames Valley Limited

  
	
  CableTel Cardiff Limited

  
	
  Cabletel (UK) Limited

  
	
  CableTel Central Hertfordshire Limited

  
	
  CableTel Hertfordshire Limited

  
	
  CableTel Herts and Beds Limited

  
	
  CableTel Investments Limited

  
	
  CableTel Newport

  
	
  CableTel North Bedfordshire Limited

  
	
  CableTel Scotland Limited

  
	
  CableTel Surrey and Hampshire Limited

  
	
  CableTel Telecom Supplies Limited

  
	
  CableTel West Glamorgan Limited

  
	
  CableTel West Riding Limited

  
	
  Cambridge Cable Services Limited

  
	
  Cambridge Holding Company Limited

  
	
  CCL Corporate Communications Services Limited

  
	
  Chartwell Investors L.P.

  
	
  Columbia Management Limited

  
	
  ComTel Cable Services Limited

  
	
  ComTel Coventry Limited

  
	
  Credit-Track Debt Recovery Limited

  
	
  Diamond Cable (Bassetlaw) Limited

  
	
  Diamond Cable (Burton-Upon-Trent) Limited

  
	
  Diamond Cable (Chesterfield) Limited

  
	
  Diamond Cable (Grantham) Limited

  
	
  Diamond Cable (Grimclee) Limited

  

 

43

 

	
  Diamond Cable (Hinckley) Limited

  
	
  Diamond Cable (Leicester) Limited

  
	
  Diamond Cable (Lincoln) Limited

  
	
  Diamond Cable (Lincolnshire) Limited

  
	
  Diamond Cable (Mansfield) Limited

  
	
  Diamond Cable (Melton Mowbray) Limited

  
	
  Diamond Cable (Newark-On-Trent) Limited

  
	
  Diamond Cable (Ravenshead) Limited

  
	
  Diamond Cable (Vale Of Belvoir) Limited

  
	
  Diamond Cable Acquisitions Limited

  
	
  Diamond Cable Communications Limited

  
	
  Diamond Cable Construction Limited

  
	
  Diamond Cable CPE Limited

  
	
  Diamond Holdings Limited

  
	
  Diamond Visual Communications Limited

  
	
  Digital Television Network Limited

  
	
  DTELS Limited

  
	
  East Coast Cable Limited

  
	
  East Midlands Cable Communications Limited

  
	
  East Midlands Cable Group Limited

  
	
  East Midlands Cable Holdings Limited

  
	
  Enablis Limited

  
	
  Heartland Cablevision (UK) Limited

  
	
  Heartland Cablevision II (UK) Limited

  
	
  Herts Cable Limited

  
	
  Jewel Holdings Limited

  
	
  Lanbase European Holdings Limited

  
	
  Lanbase Limited

  
	
  LCL Cable (Holdings) Limited

  
	
  LCL Telephones Limited

  
	
  Lichfield Cable Communications Limited

  
	
  Maza Limited

  
	
  Metro Hertfordshire Limited

  
	
  Metro South Wales Limited

  
	
  NNS UK Holdings 1 LLC

  

 

44

 

	
  NNS U.K. Holdings 2, Inc.

  
	
  North CableComms Holdings, Inc.

  
	
  North CableComms L.L.C.

  
	
  North CableComms Management, Inc.

  
	
  Northampton Cable Television Limited

  
	
  NTL (Aylesbury and Chiltern) Limited

  
	
  NTL (B) Limited

  
	
  NTL (Broadland) Limited

  
	
  NTL (Chichester) Limited

  
	
  NTL (City & Westminster) Limited

  
	
  NTL (County Durham) Limited

  
	
  NTL (CRUK) Limited

  
	
  NTL (CWC Holdings)

  
	
  NTL (CWC) Corporation Limited

  
	
  NTL (CWC) Limited

  
	
  NTL (CWC) Management Limited

  
	
  NTL (CWC) No. 2 Limited

  
	
  NTL (CWC) No. 3 Limited

  
	
  NTL (CWC) No. 4 Limited

  
	
  NTL (CWC) Programming Limited

  
	
  NTL (CWC) UK

  
	
  NTL (Ealing) Limited

  
	
  NTL (Eastbourne and Hastings) Limited

  
	
  NTL (Fenland) Limited

  
	
  NTL (Greenwich and Lewisham) Limited

  
	
  NTL (Hampshire) Limited

  
	
  NTL (Harrogate) Limited

  
	
  NTL (Harrow) Limited

  
	
  NTL (Kent) Limited

  
	
  NTL (Lambeth and Southwark) Limited

  
	
  NTL (Leeds) Limited

  
	
  NTL (Norwich) Limited

  
	
  NTL (Peterborough) Limited

  
	
  NTL (South East) Limited

  
	
  NTL (South London) Limited

  

 

45

 

	
  NTL (Southampton and Eastleigh) Limited

  
	
  NTL (Sunderland) Limited

  
	
  NTL (Thamesmead) Limited

  
	
  NTL (Triangle) LLC

  
	
  NTL (V) Limited

  
	
  NTL (Wandsworth) Limited

  
	
  NTL (Wearside) Limited

  
	
  NTL (West London) Limited

  
	
  NTL (Yorcan) Limited

  
	
  NTL (York) Limited

  
	
  NTL Acquisition Company Limited

  
	
  NTL Bolton Cablevision Holding Company

  
	
  NTL Bromley Company

  
	
  NTL Business (Ireland) Limited

  
	
  NTL Business Limited

  
	
  NTL Cablecomms Bolton

  
	
  NTL Cablecomms Bromley

  
	
  NTL Cablecomms Bury and Rochdale

  
	
  NTL Cablecomms Cheshire

  
	
  NTL Cablecomms Derby

  
	
  NTL Cablecomms East Lancashire

  
	
  NTL Cablecomms Greater Manchester

  
	
  NTL Cablecomms Group Limited

  
	
  ntl CableComms Group, Inc.

  
	
  NTL Cablecomms Holdings No. 1 Limited

  
	
  NTL Cablecomms Holdings No. 2 Limited

  
	
  NTL Cablecomms Lancashire No. 1

  
	
  NTL Cablecomms Lancashire No. 2

  
	
  NTL Cablecomms Limited

  
	
  NTL Cablecomms Macclesfield

  
	
  NTL Cablecomms Manchester Limited

  
	
  NTL Cablecomms Oldham and Tameside

  
	
  NTL Cablecomms Solent

  
	
  NTL Cablecomms Staffordshire

  
	
  NTL Cablecomms Stockport

  

 

46

 

	
  NTL Cablecomms Surrey

  
	
  NTL Cablecomms Sussex

  
	
  NTL Cablecomms Wessex

  
	
  NTL Cablecomms West Surrey Limited

  
	
  NTL Cablecomms Wirral

  
	
  NTL Cambridge Limited

  
	
  NTL Chartwell Holdings 2, Inc.

  
	
  NTL Chartwell Holdings, Inc.

  
	
  NTL Chartwell Holdings Limited

  
	
  NTL Communications Services Limited

  
	
  NTL Darlington Limited

  
	
  NTL Derby Cablevision Holding Company

  
	
  NTL Equipment No. 1 Limited

  
	
  NTL Equipment No. 2 Limited

  
	
  NTL Finance Limited

  
	
  NTL Glasgow

  
	
  NTL Glasgow Holdings Limited

  
	
  NTL Holdings (Broadland) Limited

  
	
  NTL Holdings (East London) Limited

  
	
  NTL Holdings (Fenland) Limited

  
	
  NTL Holdings (Leeds) Limited

  
	
  NTL Holdings (Norwich) Limited

  
	
  NTL Holdings (Peterborough) Limited

  
	
  NTL Internet Limited

  
	
  NTL Internet Services Limited

  
	
  NTL Investment Holdings Limited

  
	
  NTL Irish Holdings Limited

  
	
  NTL Kirklees

  
	
  NTL Kirklees Holdings Limited

  
	
  NTL Limited

  
	
  NTL Manchester Cablevision Holding Company

  
	
  NTL Microclock Services Limited

  
	
  NTL Midlands Limited

  
	
  NTL Milton Keynes Limited

  
	
  NTL National Networks Limited

  

 

47

 

	
  NTL Networks Limited

  
	
  NTL North CableComms Holdings, Inc.

  
	
  NTL North CableComms Management, Inc.

  
	
  NTL Partcheer Company Limited

  
	
  NTL Programming Subsidiary Company

  
	
  NTL Rectangle Limited

  
	
  NTL Sideoffer Limited

  
	
  NTL Solent Company

  
	
  NTL Solent Telephone and Cable TV Company Limited

  
	
  NTL South CableComms Holdings, Inc.

  
	
  NTL South CableComms Management, Inc.

  
	
  NTL South Central Limited

  
	
  NTL South Wales Limited

  
	
  NTL Streetunique Projects Limited

  
	
  NTL Streetunit Projects Limited

  
	
  NTL Streetusual Services Limited

  
	
  NTL Streetvision Services Limited

  
	
  NTL Streetvital Services Limited

  
	
  NTL Streetwarm Services Limited

  
	
  NTL Streetwide Services Limited

  
	
  NTL Strikeagent Trading Limited

  
	
  NTL Strikeamount Trading Limited

  
	
  NTL Strikeapart Trading Limited

  
	
  NTL Surrey Company

  
	
  NTL Sussex Company

  
	
  NTL Systems Limited

  
	
  NTL Technical Support Company Limited

  
	
  NTL Teesside Limited

  
	
  NTL Telecom Services Limited

  
	
  NTL UK CableComms Holdings, Inc.

  
	
  NTL UK Telephone and Cable TV Holding Company Limited

  
	
  NTL Victoria Limited

  
	
  NTL Victoria II Limited

  
	
  NTL Wessex Company

  
	
  NTL Westminster Limited

  

 

48

 

	
  NTL Winston Holdings Limited

  
	
  NTL Winston Holdings, Inc.

  
	
  NTL Wirral Company

  
	
  NTL Wirral Telephone and Cable TV Company

  
	
  Oxford Cable Limited

  
	
  Prospectre Limited

  
	
  Secure Backup Systems Limited

  
	
  South CableComms Holdings, Inc.

  
	
  South CableComms L.L.C.

  
	
  South CableComms Management, Inc.

  
	
  Southern East Anglia Cable Limited

  
	
  Stafford Communications Limited

  
	
  Swindon Cable Limited

  
	
  Tamworth Cable Communications Limited

  
	
  VMIH Sub Limited

  
	
  Virgin Media Dover LLC

  
	
  Virgin Media Group Limited

  
	
  Virgin Net Limited

  
	
  Vision Networks Services UK Limited

  
	
  Wessex Cable Limited

  
	
  Winston Investors L.L.C.

  
	
  XL Debt Recovery Agency Limited

  
	
  X-Tant Limited

  
	
  TELEWEST GROUP COMPANIES

  
	
  Birmingham Cable Corporation Limited

  
	
  Birmingham Cable Limited

  
	
  Cable Camden Limited

  
	
  Cable Enfield Limited

  
	
  Cable Hackney & Islington Limited

  
	
  Cable Haringey Limited

  
	
  Cable London Limited

  
	
  Central Cable Holdings Limited

  
	
  Crystal Palace Radio Limited

  
	
  Filegale Limited

  
	
  General Cable Group Limited

  

 

49

 

	
  General Cable Holdings Limited

  
	
  General Cable Limited

  
	
  Imminus Limited

  
	
  Middlesex Cable Limited

  
	
  Sheffield Cable Communications Limited

  
	
  Southwestern Bell International Holdings Limited

  
	
  Telewest Communications (Central Lancashire) Limited

  
	
  Telewest Communications (Cotswolds) Limited

  
	
  Telewest Communications (Liverpool) Limited

  
	
  Telewest Communications (London South) Limited

  
	
  Telewest Communications (Midlands and North West) Limited

  
	
  Telewest Communications (Midlands) Limited

  
	
  Telewest Communications (Nominees) Limited

  
	
  Telewest Communications (North East) Limited

  
	
  Telewest Communications (North West) Limited

  
	
  Telewest Communications (South East) Limited

  
	
  Telewest Communications (South Thames Estuary) Limited

  
	
  Telewest Communications (South West) Limited

  
	
  Telewest Communications (St. Helens & Knowsley) Limited

  
	
  Telewest Communications (Tyneside) Limited

  
	
  Telewest Communications (Wigan) Limited

  
	
  Telewest Communications Cable Limited

  
	
  Telewest Communications Group Limited

  
	
  Telewest Communications Holdings Limited

  
	
  Telewest Communications Networks Limited

  
	
  Telewest UK Limited

  
	
  Telewest Limited

  
	
  Telewest Parliamentary Holdings Limited

  
	
  The Cable Corporation Limited

  
	
  Theseus No. 1 Limited

  
	
  Theseus No. 2 Limited

  
	
  Windsor Television Limited

  
	
  Yorkshire Cable Communications Limited

  
	
  The Yorkshire Cable Group Limited

  
	
  EuroBell (Holdings) Limited

  

 

50

 

	
  EuroBell (Sussex) Limited

  
	
  EuroBell (South West) Limited

  
	
  EuroBell (West Kent) Limited

  
	
  EuroBell (IDA) Limited

  
	
  EuroBell Internet Services Limited

  
	
  EuroBell CPE Limited

  
	
  EuroBell Limited

  
	
  EMS Investments Limited

  
	
  EuroBell (No. 2) Limited

  
	
  EuroBell (No. 3) Limited

  
	
  EuroBell (No. 4) Limited

  
	
  SCOTTISH COMPANIES

  
	
  Telewest Communications (Dundee & Perth) Limited

  
	
  Telewest Communications (Motherwell) Limited

  
	
  Telewest Communications (Scotland Holdings) Limited

  
	
  Telewest Communications (Scotland) Limited

  
	
  JERSEY COMPANY

  
	
  Birmingham Cable Finance Limited

  
	
  PARTNERSHIPS AND JOINT VENTURES

  
	
  Avon Cable Joint Venture

  
	
  Avon Cable Limited Partnership

  
	
  Cotswolds Cable Limited Partnership

  
	
  Edinburgh Cable Limited Partnership

  
	
  Estuaries Cable Limited Partnership

  
	
  London South Cable Partnership

  
	
  TCI/US West Cable Communications Group

  
	
  Telewest Communications (London South) Joint Venture

  
	
  Telewest Communications (Cotswolds) Venture

  
	
  Telewest Communications (North East) Partnership

  
	
  Telewest Communications (Scotland) Venture

  
	
  Telewest Communications (South East) Partnership

  
	
  Tyneside Cable Limited Partnership

  
	
  United Cable (London South) Limited Partnership

  
	
  FLEXTECH

  
	
  Flextech Broadband Limited

  

 

51

 

	
  Flextech Broadcasting Limited

  
	
  Screenshop Limited

  
	
  Living TV Limited

  
	
  Trouble TV Limited

  
	
  Challenge TV

  
	
  Bravo TV Limited

  
	
  Ed Stone Limited

  
	
  United Artists Investments Limited

  
	
  Flextech Business News Limited

  
	
  Continental Shelf 16 Limited

  
	
  TVS Television Limited

  
	
  TVS Pension Fund Trustees Limited

  
	
  Telso Communications Limited

  
	
  Flextech Rights Limited

  
	
  Minotaur International Limited

  
	
  Flextech Television Limited

  
	
  Interactive Digital Sales Limited

  
	
  Flextech Music Publishing Limited

  
	
  Flextech (1992) Limited

  
	
  Flextech Media Holdings Limited

  
	
  Flextech (Kindernet Investment) Limited

  
	
  Flextech-Flexinvest Limited

  
	
  Flextech IVS Limited

  
	
  Flextech Family Channel Limited

  
	
  Flextech Distribution Limited

  
	
  Flextech Childrens Channel Limited

  
	
  Flextech Communications Limited

  
	
  Flextech (Travel Channel) Limited

  
	
  Flextech Digital Broadcasting Limited

  
	
  Flextech Video Games Limited

  

 

52

 

SCHEDULE 4

THE EXISTING HEDGE COUNTERPARTIES

 

ABN AMRO BANK N.V.

 

Barclays Bank Plc

 

BNP Paribas

 

Calyon

 

Commerzbank Aktiengesellschaft

 

Cooperatieve Centrale
Raiffeisen-Boerenleenbank BA (trading as Rabobank International) London Branch

 

Credit Suisse International

 

Deutsche Bank AG, London Branch

 

Fortis Bank SA NV

 

Goldman Sachs International

 

HSBC Bank Plc

 

Lloyds TSB Bank Plc

 

Natixis Banques Populaires

 

SOCIÉTÉ GÉNÉRALE

 

The Governor and Company of the Bank of
Ireland

 

The Governor and Company of the Bank of
Scotland

 

The Royal Bank of Scotland plc

 

WestLB AG

 

53

 

SIGNATURES

 

54

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