Document:

exv4w12

 

Exhibit 4(a)(ii)

EXECUTION COPY

£1,600,000,000

FACILITY AGREEMENT

 

dated 9 November 2004

 

for

 

INTERCONTINENTAL HOTELS GROUP PLC

arranged by

THE BANK OF TOKYO-MITSUBISHI, LTD.

BARCLAYS CAPITAL

CITIGROUP GLOBAL MARKETS LIMITED

HSBC BANK plc

J.P. MORGAN plc

LLOYDS TSB BANK plc

SG CORPORATE & INVESTMENT BANKING

THE ROYAL BANK OF SCOTLAND plc

WESTLB AG, LONDON BRANCH

 

with

 

 

HSBC BANK plc

acting as Agent

 

 

Linklaters

Ref: PHPS/JLM/VR

 

 

CONTENTS

	 	 	 	 	 	 	 
	CLAUSE	 	 	 	PAGE	 
	 	 	SECTION 1
INTERPRETATION	 	 	 	 
	1.	 	Definitions and interpretation
	 	 	1	 
	 	 	SECTION 2
THE FACILITIES	 	 	 	 
	2.	 	The Facilities
	 	 	15	 
	3.	 	Purpose
	 	 	15	 
	4.	 	Conditions of Utilisation
	 	 	15	 
	 	 	SECTION 3
UTILISATION	 	 	 	 
	5.	 	Utilisation
	 	 	17	 
	6.	 	Optional Currencies
	 	 	18	 
	 	 	SECTION 4
REPAYMENT, PREPAYMENT AND CANCELLATION	 	 	 	 
	7.	 	Repayment
	 	 	21	 
	8.	 	Prepayment and cancellation
	 	 	22	 
	 	 	SECTION 5
COSTS OF UTILISATION	 	 	 	 
	9.	 	Interest
	 	 	25	 
	10.	 	Interest Periods
	 	 	26	 
	11.	 	Changes to the calculation of interest
	 	 	27	 
	12.	 	Fees
	 	 	28	 
	 	 	SECTION 6
ADDITIONAL PAYMENT OBLIGATIONS	 	 	 	 
	13.	 	Tax gross up and indemnities
	 	 	29	 
	14.	 	Increased costs
	 	 	35	 
	15.	 	Other indemnities
	 	 	35	 
	16.	 	Mitigation by the Lenders
	 	 	37	 
	17.	 	Costs and expenses
	 	 	37	 
	 	 	SECTION 7
GUARANTEE	 	 	 	 
	18.	 	Guarantee and indemnity
	 	 	38	 
	 	 	SECTION 8
REPRESENTATIONS, UNDERTAKINGS AND EVENTS OF DEFAULT	 	 	 	 
	19.	 	Representations
	 	 	41	 
	20.	 	Information undertakings
	 	 	43	 
	21.	 	Financial covenants
	 	 	46	 
	22.	 	General undertakings
	 	 	49	 
	23.	 	Events of Default
	 	 	52	 
	 	 	SECTION 9
CHANGES TO PARTIES	 	 	 	 
	24.	 	Changes to the Lenders
	 	 	56	 
	25.	 	Changes to the Obligors
	 	 	59	 

i

 

	 	 	 	 	 	 	 
	 	 	SECTION 10
THE FINANCE PARTIES	 	 	 	 
	26.	 	Role of the Agent and the Arranger
	 	 	62	 
	27.	 	Conduct of business by the Finance Parties
	 	 	66	 
	28.	 	Sharing among the Finance Parties
	 	 	66	 
	 	 	SECTION 11
ADMINISTRATION	 	 	 	 
	29.	 	Payment mechanics
	 	 	68	 
	30.	 	Set-off
	 	 	70	 
	31.	 	Notices
	 	 	70	 
	32.	 	Calculations and certificates
	 	 	72	 
	33.	 	Partial invalidity
	 	 	72	 
	34.	 	Remedies and waivers
	 	 	72	 
	35.	 	Amendments and waivers
	 	 	72	 
	36.	 	Counterparts
	 	 	73	 
	 	 	SECTION 12
GOVERNING LAW AND ENFORCEMENT	 	 	 	 
	37.	 	Governing law
	 	 	74	 
	38.	 	Enforcement
	 	 	74	 

THE SCHEDULES

	 	 	 	 	 
	SCHEDULE	 	PAGE	 
	SCHEDULE 1 The Original Lenders
	 	 	75	 
	SCHEDULE 2 Conditions Precedent
	 	 	76	 
	SCHEDULE 3 Requests
	 	 	78	 
	SCHEDULE 4 Mandatory Cost formulae
	 	 	80	 
	SCHEDULE 5 Form of Transfer Certificate
	 	 	83	 
	SCHEDULE 6 Form of Accession Letter
	 	 	86	 
	SCHEDULE 7 Form of Resignation Letter
	 	 	87	 
	SCHEDULE 8 Form of Compliance Certificate
	 	 	88	 
	SCHEDULE 9 Security
	 	 	89	 
	SCHEDULE 10 Timetables
	 	 	90	 
	SCHEDULE 11 Form of LMA Confidentiality Undertaking
	 	 	92	 
	SCHEDULE 12 Form of Term Out Notice
	 	 	97	 
	SCHEDULE 13 Form of Margin Certificate
	 	 	98	 

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THIS AGREEMENT is dated 9 November 2004 and made between:

	(1)	 	INTERCONTINENTAL HOTELS GROUP PLC incorporated in England and Wales with registration
number 4551528 (“IHG”);
	 
	(2)	 	SIX CONTINENTS PLC incorporated in England and Wales with registration number 913450
(together with IHG, the “Original Borrowers”);
	 
	(3)	 	SIX CONTINENTS PLC incorporated in England and Wales with registration number 913450
(together with IHG, the “Original Guarantors”);
	 
	(4)	 	THE BANK OF TOKYO-MITSUBISHI, LTD., BARCLAYS CAPITAL, CITIGROUP GLOBAL MARKETS
LIMITED, HSBC BANK plc, J.P. MORGAN plc, LLOYDS TSB BANK plc, SG
CORPORATE & INVESTMENT BANKING, THE ROYAL BANK OF SCOTLAND plc and WESTLB AG, LONDON BRANCH
as mandated lead arrangers (whether acting individually or together the “Arranger”);
	 
	(5)	 	THE FINANCIAL INSTITUTIONS listed in Schedule 1 as lenders (the “Original Lenders”);
and
	 
	(6)	 	HSBC BANK plc as agent of the other Finance Parties (the “Agent”).

IT IS AGREED as follows:

SECTION 1

INTERPRETATION

	1.	 	DEFINITIONS AND INTERPRETATION
	 
	1.1	 	Definitions
	 
	 	 	In this Agreement:
	 
	 	 	“Accession Letter” means a document substantially in the form set out in Schedule 6 (Form
of Accession Letter).
	 
	 	 	“Additional Borrower” means a company which becomes an Additional Borrower in accordance
with Clause 25 (Changes to the Obligors).
	 
	 	 	“Additional Cost Rate” has the meaning given to it in Schedule 4 (Mandatory Cost formulae).
	 
	 	 	“Additional Guarantor” means a company which becomes an Additional Guarantor in accordance
with Clause 25 (Changes to the Obligors).
	 
	 	 	“Additional Obligor” means an Additional Borrower or an Additional Guarantor.
	 
	 	 	“Affiliate” means, in relation to any person, a Subsidiary of that person or a Holding
Company of that person or any other Subsidiary of that Holding Company.
	 
	 	 	“Agency Fee Letter” means the letter dated 9 November 2004 between the Agent and IHG
setting out the fees referred to in Clause 12.3 (Agency fee).
	 
	 	 	“Agent’s Spot Rate of Exchange” means the spot rate of exchange at which the Agent is able
to purchase the relevant currency with the Base Currency in the London foreign exchange
market at or about 11:00 a.m. on a particular day.

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	 	 	“Applicable Accounting Principles” means those accounting principles, standards and practices on
which the preparation of the Original Financial Statements was based and those accounting policies
which were used in the preparation of those financial statements.
	 
	 	 	“Authorisation” means an authorisation, consent, approval, resolution, licence, exemption, filing,
notarisation or registration.
	 
	 	 	“Availability Period” means:

	 	(a)	 	in relation to Facility A, the period from and including the date of this Agreement
to and including the date falling one month prior to the Termination Date applicable to
Facility A; and
	 
	 	(b)	 	in relation to Facility B, the period from and including the date of this Agreement
to and including the date which is the earlier of:

	 	(i)	 	the date which falls one month prior to the Termination Date
applicable to Facility B; and
	 
	 	(ii)	 	the Term Out Date.

	 	 	“Available Commitment” means, in relation to a Facility, a Lender’s Commitment under that Facility
minus:

	 	(a)	 	the Base Currency Amount of its participation in any outstanding Loans under that
Facility; and
	 
	 	(b)	 	in relation to any proposed Utilisation, the Base Currency Amount of its
participation in any Loans that are due to be made under that Facility on or before the
proposed Utilisation Date,

	 	 	other than, in relation to any proposed Utilisation under Facility A or any proposed Utilisation
under Facility B before the Term Out Date only, that Lender’s participation in any Loans that are
due to be repaid or prepaid on or before the proposed Utilisation Date.

	 	 	“Available Facility” means, in relation to a Facility, the aggregate for the time being of each
Lender’s Available Commitment in respect of that Facility.
	 
	 	 	“Base Currency” or “£” means Sterling.
	 
	 	 	“Base Currency Amount” means, in relation to a Loan, the amount specified in the Utilisation
Request delivered by a Borrower for that Loan (or, if the amount requested is not denominated in
the Base Currency, that amount converted into the Base Currency at the Agent’s Spot Rate of
Exchange on the date which is three Business Days before the Utilisation Date or, if later, on the
date the Agent receives the Utilisation Request) adjusted to reflect any repayment (other than, in
relation to Facility B after the Term Out Date, a repayment arising from a change of currency),
prepayment, consolidation or division of the Loan.
	 
	 	 	“Borrower” means an Original Borrower or an Additional Borrower, unless it has ceased to be a
Borrower in accordance with Clause 25 (Changes to the Obligors).
	 
	 	 	“Borrowings” has the meaning given to it in Clause 21 (Financial covenants).

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	 	 	“Boston Lease” means the lease entered into or to be entered into in respect of the proposed
InterContinental Boston located at 500 Atlantic Avenue, Boston, Massachusetts.
	 
	 	 	“Break Costs” means the amount (if any) by which:

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

	 	 	exceeds:

	 	(b)	 	the amount which that Lender would be able to obtain by placing an amount equal to
the principal amount or Unpaid Sum received by it on deposit with a leading bank in the
Relevant Interbank Market for a period starting on the Business Day following receipt or
recovery and ending on the last day of the current Interest Period.

	 	 	“Britvic” means Britannia Soft Drinks Limited and its subsidiaries for the time being.
	 
	 	 	“Business Day” means a day (other than a Saturday or Sunday) on which banks are open for general
business in London and:

	 	(a)	 	(in relation to any date for payment, purchase or sale of a currency other than euro)
the principal financial centre of the country of that currency; or
	 
	 	(b)	 	(in relation to any date for payment, purchase or sale of euro) any TARGET Day.

	 	 	“Cash” has the meaning given to it in Clause 21 (Financial covenants).
	 
	 	 	“Cash Equivalent Investments” has the meaning given to it in Clause 21 (Financial covenants).
	 
	 	 	“Commitment” means a Facility A Commitment or a Facility B Commitment.
	 
	 	 	“Company” means, at any time prior to the New Parent Scheme Date, IHG and, at any time from and including the New Parent Scheme
Date, the New Parent.
	 
	 	 	“Compliance Certificate” means a certificate substantially in the form set out in Schedule 8 (Form
of Compliance Certificate).
	 
	 	 	“Confidentiality Undertaking” means a confidentiality undertaking in
the form set out in Schedule 11 (Form of LMA Confidentiality Undertaking) or in any other form
agreed between the Company and the Agent.
	 
	 	 	“Consolidated Gross Assets” means the consolidated fixed assets plus consolidated current assets of
the Group.
	 
	 	 	“Default” means an Event of Default or any event or circumstance specified in Clause 23 (Events of
Default) which would (with the expiry of a grace period and/or the giving of notice) be an Event of
Default.
	 
	 	 	“EBITDA” has the meaning given to it in Clause 21 (Financial covenants).
	 
	 	 	“EURIBOR” means, in relation to any Loan in euro:

	 	(a)	 	the applicable Screen Rate; or

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

	 	 	as of the Specified Time on the Quotation Day for the offering of deposits in euro for a period
comparable to the Interest Period of the relevant Loan.
	 
	 	 	“euro” or
“€” means the single currency of the Participating Member States.
	 
	 	 	“Event of Default” means any event or circumstance specified as such in Clause 23 (Events of
Default).
	 
	 	 	“Existing Facility” means the $2,650,000,000 facility agreement dated 13 February 2003
(as amended by an amendment letter dated 26 February 2003) between IHG, the lenders and arrangers
named in it and HSBC Bank plc as agent.
	 
	 	 	“Facility” means Facility A or Facility B.

	 
	 	 	“Facility A” means the revolving loan facility made available under this Agreement as described in
Clause 2.1(a) (The Facilities).
	 
	 	 	“Facility A Commitment” means:

	 	(a)	 	in relation to an Original Lender, the amount in the Base Currency set opposite its
name under the heading “Facility A Commitment” in Schedule 1 (The Original Lenders) and
the amount of any other Facility A Commitment transferred to it under this Agreement; and
	 
	 	(b)	 	in relation to any other Lender, the amount in the Base Currency of any Facility A
Commitment transferred to it under this Agreement,

	 	 	to the extent not cancelled, reduced or transferred by it under this Agreement.
	 
	 	 	“Facility A Loan” means a loan made or to be made under Facility A or the principal amount
outstanding for the time being of that loan.
	 
	 	 	“Facility A Repayment Date” means the Termination Date applicable to Facility A.
	 
	 	 	“Facility B” means the revolving loan facility or, after the Term Out Date, the term loan facility
made available under this Agreement as described in Clause 2.1(b) (The Facilities).
	 
	 	 	“Facility B Commitment” means:

	 	(a)	 	in relation to an Original Lender, the amount in the Base Currency set opposite its
name under the heading “Facility B Commitment” in Schedule 1 (The Original Lenders) and
the amount of any other Facility B Commitment transferred to it under this Agreement; and
	 
	 	(b)	 	in relation to any other Lender, the amount in the Base Currency of any Facility B
Commitment transferred to it under this Agreement,

	 	 	to the extent not cancelled, reduced or transferred by it under this Agreement.
	 
	 	 	“Facility B Loan” means a loan made or to be made under Facility B or the principal amount
outstanding for the time being of that loan.

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	 	 	“Facility Office” means the office or offices notified by a Lender to the Agent in writing on or
before the date it becomes a Lender (or, following that date, by not less than five Business Days’
written notice) as the office or offices through which it will perform its obligations under this
Agreement.
	 
	 	 	“Final Facility B Termination Date” means the date which is 24 Months from the date of this
Agreement.
	 
	 	 	“Finance Document” means this Agreement, the Agency Fee Letter, the Mandate Letter, any Accession
Letter, any Resignation Letter and any other document designated as such by the Agent and the
Company.
	 
	 	 	“Finance Party” means the Agent, the Arranger or a Lender.
	 
	 	 	“Financial Indebtedness” means any indebtedness (without double counting) for or in respect of:

	 	(a)	 	moneys borrowed;
	 
	 	(b)	 	any amount raised by acceptance under any acceptance credit facility or
dematerialised equivalent;
	 
	 	(c)	 	any amount raised pursuant to any note purchase facility or the issue of bonds,
notes, debentures, loan stock, commercial paper or any similar instrument (entered into or
issued primarily as a method of raising finance);
	 
	 	(d)	 	the amount of any liability in respect of any lease or hire purchase contract which
would, in accordance with GAAP, be treated as a finance or capital lease (and excluding,
for the avoidance of doubt, the Boston Lease);
	 
	 	(e)	 	receivables sold or discounted (other than any receivables to the extent they are
sold or discounted on a non-recourse basis);
	 
	 	(f)	 	any amount:

	 	(i)	 	raised under any other transaction (including any forward sale or
purchase agreement) required by GAAP to be shown as a borrowing in the audited
consolidated balance sheet of the Group; or
	 
	 	(ii)	 	raised under any other transaction entered into primarily as a method
of raising finance not required by GAAP to be shown as a borrowing in the audited
consolidated balance sheet of the Group;

	 	(g)	 	for the purpose of Clause 23.5 (Cross default) only, any derivative transaction
entered into in connection with protection against or benefit from fluctuation in any rate
or price (and, when calculating the value of any derivative transaction, only the marked
to market value shall be taken into account);
	 
	 	(h)	 	shares which are expressed to be redeemable prior to the Termination Date for
Facility A other than those which are issued in connection with the New Parent Scheme or
those where redemption of such shares is conditional;
	 
	 	(i)	 	any counter-indemnity obligation in respect of a guarantee, indemnity, bond, letter
of credit or any other instrument issued by a bank or financial institution; and

5

 

	 	(j)	 	the amount of any liability in respect of any guarantee or indemnity for any of the
items referred to in paragraphs (a) to (i) above,

	 	 	but excluding indebtedness owing by a member of the Group to another member of the Group.
	 
	 	 	“Fitch” means Fitch Ratings.

	 
	 	 	“GAAP” means generally accepted accounting principles, standards and practices in the United
Kingdom.
	 
	 	 	“Group” means, at any time prior to the New Parent Scheme Date, IHG and its Subsidiaries for the
time being and, at any time from and including the New Parent Scheme Date, the New Parent and its
Subsidiaries for the time being.
	 
	 	 	“Guarantor” means an Original Guarantor or an Additional Guarantor, unless it has ceased to be a
Guarantor in accordance with Clause 25 (Changes to the Obligors).
	 
	 	 	“Holding Company” means, in relation to a company or corporation, any other company or corporation
in respect of which it is a Subsidiary.
	 
	 	 	“IFRS” means, at any time, the current version of accounting standards set out by the International
Accounting Standards Board (IASB) in London, England.
	 
	 	 	“Information Memorandum” means the document in the form approved by IHG concerning the Group which,
at IHG’s request and on its behalf, is to be prepared in relation to this transaction and shall be
distributed after the date of this Agreement by the Arranger to selected financial institutions for
the purpose of primary syndication of the Facilities.
	 
	 	 	“Interest Expense” has the meaning given to it in Clause 21 (Financial covenants).
	 
	 	 	“Interest Period” means, in relation to a Loan, each period determined in accordance with Clause 10
(Interest Periods) and, in relation to an Unpaid Sum, each period determined in accordance with
Clause 9.3 (Default interest).
	 
	 	 	“Joint Venture Entity” means any joint venture company, corporation,
partnership, trust or other entity in any jurisdiction in which a member of the Group owns 50 per
cent. or less of the issued share capital, equity or voting rights.
	 
	 	 	“Lender” means:

	 	(a)	 	any Original Lender; and
	 
	 	(b)	 	any bank, financial institution, trust, fund or other entity which has become a Party
in accordance with Clause 24 (Changes to the Lenders),

	 	 	which in each case has not ceased to be a Party in accordance with the terms of this Agreement.
	 
	 	 	“LIBOR” means, in relation to any Loan:

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

6

 

	 	 	as of the Specified Time on the Quotation Day for the offering of deposits in the currency of that
Loan and for a period comparable to the Interest Period for that Loan.
	 
	 	 	“LMA” means the Loan Market Association.

	 
	 	 	“Loan” means a Facility A Loan or a Facility B Loan.
	 
	 	 	“Majority Lenders” means a Lender or Lenders whose Commitments aggregate more than
66 2/3  per cent. of the Total Commitments (or, if the Total
Commitments have been reduced to zero, aggregated more than 66 2/3 
per cent. of the Total Commitments immediately prior to the reduction).
	 
	 	 	“Managed Assets” means any assets of a member of the Group which are sold and become the subject of
a management or franchise agreement in favour of the Group.
	 
	 	 	“Mandate Letter” means the letter dated 9 November 2004 between the Arranger and IHG relating to,
amongst other things, the primary syndication of the Facilities.
	 
	 	 	“Mandatory Cost” means the percentage rate per annum calculated by the Agent in accordance with
Schedule 4 (Mandatory Cost formulae).
	 
	 	 	“Margin” means at any time the rate per annum determined by
reference to the ratio of Net Borrowings, as at the last day of the last preceding Margin Period,
to EBITDA for that Margin Period (the “Margin Ratio”) in accordance with the following table:

	 	 	 
	Net Borrowings/EBITDA	 	Margin (per cent. p.a.)
	Higher than 2.75:1
	 	0.60
	Equal to or
lower than 2.75:1 but higher than
2.25:1
	 	0.50
	Equal to or
lower than 2.25:1 but higher than
1.75:1
	 	0.425
	Equal to or
lower than 1.75:1 but higher than
1.25:1
	 	0.375
	Equal to or
lower than 1.25:1
	 	0.325

	 	 	However:

	 	(a)	 	until the delivery of the first Margin Certificate required pursuant to Clause 20.3
(Margin Certificate) the applicable Margin shall be 0.375 per cent. per annum;
	 
	 	(b)	 	any increase or decrease in the applicable Margin, as the case may be, will take
effect for all purposes under this Agreement from the date falling 2 Business Days after
receipt by the Agent of a Margin Certificate as required pursuant to Clause 20.3 (Margin
Certificate);

7

 

	 	(c)	 	if the Company does not deliver the relevant Margin Certificate to the Agent in
accordance with the terms of Clause 20.3 (Margin Certificate), the Margin shall, as from
the date immediately following the last date on which such Margin Certificate should have
been delivered until the date such Margin Certificate is delivered, be 0.60 per cent. per
annum;
	 
	 	(d)	 	if at any time an Event of Default is continuing, the Margin shall, until the date
such Event of Default ceases to be continuing, be 0.60 per cent. per annum;
	 
	 	(e)	 	if at any time a decrease in the Margin is to take effect a Default is continuing,
such decrease shall not take effect at that time but such decrease shall take effect with
effect from the date such Default ceases to be continuing; and
	 
	 	(f)	 	in this definition, “EBITDA” shall have the same meaning as EBITDA as defined in
Clause 21.3 (Definitions) save that the reference to “Relevant Period” in that definition
shall, for the purposes of calculating the Margin, be substituted with “Margin Period” and
EBITDA shall be adjusted to take into account the pro forma impact of any acquisitions or
disposals (other than of Managed Assets) made during the Margin Period by a member of the
Group.

	 	 	“Margin Certificate” means a certificate substantially in the form set out in Schedule 13 (Form of
Margin Certificate).
	 
	 	 	“Margin Period” means the period of 12 months ending on each Quarter Date.
	 
	 	 	“Margin Ratio” has the meaning given to it in the definition of Margin.
	 
	 	 	“Material Adverse Effect” means a material adverse effect on:

	 	(a)	 	the ability of the Obligors (taken as a whole) to perform and comply with their
payment obligations under any Finance Document; or
	 
	 	(b)	 	the ability of the Company to perform and comply with its obligations under Clause 21
(Financial covenants).

	 	 	“Material Subsidiary” means, at any time, any Subsidiary of the Company:

	 	(a)	 	whose gross assets represent 5 per cent. or more of Consolidated Gross Assets or
whose EBITDA represents 5 per cent. or more of consolidated EBITDA of the Group, in each
case, as calculated by reference to the latest financial statements of such Subsidiary
(which shall be audited if such statements are prepared by that Subsidiary) and the latest
audited consolidated financial statements of the Group adjusted in such manner as the
auditors of the Company may determine (which determination shall be conclusive in the
absence of manifest error) (i) to reflect the gross assets and EBITDA of any person which
has become or ceased to be a member of the Group since the end of the financial year to
which the latest audited consolidated financial statements of the Group relate where such
adjustment is requested by the Company and (ii) so that for the purposes of this
definition, the gross assets of the relevant Subsidiary shall be calculated on the same
basis as Consolidated Gross Assets are calculated and/or, as the case may be, EBITDA of
the relevant Subsidiary shall be calculated on the same basis as

8

 

	 	 	 	consolidated EBITDA for the Group (but, in each case, relating only to the relevant
Subsidiary) and making such adjustments and eliminations as are required to show the same
as the contribution of the relevant Subsidiary to Consolidated Gross Assets and/or, as the
case may be, consolidated EBITDA of the Group; or

	 	(b)	 	to which is transferred all or substantially all of the business, undertaking or
assets of a Subsidiary which immediately prior to such transfer is a Material Subsidiary,
whereupon the transferor Subsidiary shall cease to be a Material Subsidiary and the
transferee Subsidiary shall become a Material Subsidiary under this sub-paragraph (b) upon
the completion of such transfer.

	 	 	Any determination made by the auditors of the Company as to whether a Subsidiary of the Company is
or is not a Material Subsidiary at any time shall be conclusive in the absence of manifest error.
	 
	 	 	“Month” means a period starting on one day in a calendar month and ending on the numerically
corresponding day in the next calendar month, except that:

	 	(a)	 	if the numerically corresponding day is not a Business Day, that period shall end on
the next Business Day in that calendar month in which that period is to end if there is
one, or if there is not, on the immediately preceding Business Day; and
	 
	 	(b)	 	if there is no numerically corresponding day in the calendar month in which that
period is to end, that period shall end on the last Business Day in that calendar month.

	 	 	The above rules will only apply to the last Month of any period.
	 
	 	 	“Moody’s” means Moody’s Investors Services Inc.
	 
	 	 	“Net Borrowings” has the meaning given to it in Clause 21 (Financial covenants).
	 
	 	 	“Net Interest Payable” has the meaning given to it in Clause 21 (Financial covenants).
	 
	 	 	“New Parent” means the company registered in England and Wales or such other jurisdiction approved
by all Lenders (acting reasonably) which shall ultimately be the Holding Company of IHG on and
following the New Parent Scheme Date.
	 
	 	 	“New Parent Scheme” means the scheme under which:

	 	(a)	 	the New Parent is inserted above IHG;
	 
	 	(b)	 	the existing share capital of IHG is cancelled and new shares are issued to the New
Parent; and
	 
	 	(c)	 	the existing shareholders of IHG receive shares in the New Parent on a proportionate
basis to their existing holdings.

	 	 	“New Parent Scheme Date” means, in relation to the New Parent Scheme, the date upon which:

	 	(a)	 	the court order in relation to the reduction of share capital of the New Parent has
been filed;
	 
	 	(b)	 	the shares in the New Parent are listed on the relevant exchanges; and

9

 

	 	(c)	 	the New Parent has acceded to this Agreement as an Additional Guarantor in accordance
with Clause 25.4 (Additional Guarantors).

	 	 	“Obligor” means the Company, a Borrower or a Guarantor.
	 
	 	 	“Optional Currency” means a currency (other than the Base Currency) which complies with the
conditions set out in Clause 4.3 (Conditions relating to Optional Currencies).
	 
	 	 	“Original Financial Statements” means the audited consolidated financial statements of the Group for the financial
period ended 31 December 2003.
	 
	 	 	“Original Obligor” means an Original Borrower or an Original Guarantor.
	 
	 	 	“Participating Member State” means any member state of the European Communities that adopts or has
adopted the euro as its lawful currency in accordance with legislation of the European Community
relating to Economic and Monetary Union.
	 
	 	 	“Party” means a party to this Agreement.

	 
	 	 	“Project Finance Indebtedness” means Financial Indebtedness (in respect of which Security has been
given) incurred by a member of the Group (a “Project Group Member”) for the purposes of financing
the acquisition, construction, development and/or operation of an
asset (a “Project Asset”) where
the provider of the Financial Indebtedness has no recourse against any member of the Group, except
for recourse to:

	 	(a)	 	the Project Asset of the Project Group Member or receivables arising from the Project
Asset;
	 
	 	(b)	 	a Project Group Member for the purpose of enforcing Security given by it so long as:

	 	(i)	 	the recourse is limited to recoveries in respect of the Project
Asset; and
	 
	 	(ii)	 	if the Project Asset does not comprise all or substantially all of
the business of that Project Group Member, the provider of the Financial
Indebtedness does not have the right to take any steps towards its winding up or
dissolution or the appointment of a liquidator, administrator, receiver or similar
officer or person, other than in respect of the Project Asset or receivables
arising therefrom; or

	 	(c)	 	a member of the Group to the extent only of its shareholding in a Project Group
Member.

	 	 	“Project Group Member” has the meaning given to it in the definition of Project Finance
Indebtedness provided that the principal assets and business of such member of the Group is
constituted by Project Assets and it has no other Financial Indebtedness except Project Finance
Indebtedness.
	 
	 	 	“Qualifying Lender” has the meaning given to it in Clause 13 (Tax gross-up and indemnities).
	 
	 	 	“Quarter Date” means each 31 March, 30 June, 30 September and 31 December in each financial year of
the Company.
	 
	 	 	“Quotation Day” means, in relation to any period for which an interest rate is to be determined:

	 	(a)	 	(if the currency is Sterling) the first day of that period;

	 
	 	(b)	 	(if the currency is euro) two TARGET Days before the first day of that period; or

10

 

	 	(c)	 	(for any other currency) two Business Days before the first day of that period,

	 	unless market
practice differs in the Relevant Interbank Market for a currency, in which case the Quotation Day
for that currency will be determined by the Agent in accordance with market practice in the
Relevant Interbank Market (and if quotations for that currency and period would normally be given
by leading banks in the Relevant Interbank Market on more than one day, the Quotation Day will be
the last of those days).

	 	“Reference Banks” means, in relation to LIBOR, Mandatory Costs and EURIBOR the principal London
offices of Citibank, N.A., The Royal Bank of Scotland plc and HSBC Bank Plc or such other banks as
may be appointed by the Agent in agreement with the Company (such agreement not to be unreasonably
withheld).

	 	“Relevant Interbank Market” means, in relation to euro, the European interbank market and, in
relation to any other currency, the London interbank market.

	 	“Relevant Period” has the meaning given to it in Clause 21 (Financial covenants).

	 	“Repeating Representations” means each of the representations set out in Clauses 19.1 (Status) to
19.4 (Power and authority), paragraph (a) of Clause 19.6 (No Default) and 19.8 (Pari passu
ranking).

	 	“Resignation Letter” means a letter substantially in the form set out in Schedule 7 (Form
of Resignation Letter).

	 	“Rollover Loan” means one or more Facility A Loans or one or more Facility
B Loans prior to the Term Out Date:

	 	(a)	 	made or to be made on the same day that one or more maturing Facility A Loans or
Facility B Loans, as the case may be, is or are due to be repaid;

	 	(b)	 	the aggregate amount of which is equal to or less than the maturing Facility A
Loan(s) or, as the case may be, Facility B Loan(s) (unless it is more than the maturing
Facility A Loan(s) or Facility B Loan(s) solely because it arose as a result of the operation of
Clause 6.2 (Unavailability of a currency));

	 	(c)	 	in the same currency as the maturing Facility A Loan(s) or Facility B Loan(s) (unless
it arose as a result of the operation of Clause 6.2 (Unavailability of a currency)); and

	 	(d)	 	made or to be made to the same Borrower under the same Facility for the purpose of
refinancing the maturing Facility A Loan(s) or Facility B Loan(s).

	 	“S&P” means Standard & Poor’s Ratings Service.

	 	“Screen Rate” means:

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

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

11

 

	 	 	displayed on the appropriate page of the Reuters screen. If the agreed page is replaced or service
ceases to be available, the Agent may specify another page or service displaying the appropriate
rate after consultation with the Company and the Lenders.
	 
	 	 	“Security” means a mortgage, pledge, lien, hypothecation, security interest or other charge or
encumbrance entered into for the purpose of securing any obligation of any person.
	 
	 	 	“Selection Notice” means a notice substantially in the form set out in Part II of Schedule 3
(Selection Notice) given in accordance with Clause 10 (Interest Periods) in relation to a Term
Loan.
	 
	 	 	“Specified Time” means a time determined in accordance with Schedule 10 (Timetables).
	 
	 	 	“Sterling” or “£” means the lawful currency for the time being of the United Kingdom.
	 
	 	 	“Subsidiary” means a subsidiary within the meaning of section 736 of the Companies Act 1985 and, for the purpose of
Clause 21 (Financial covenants) and in relation to financial statements of the Group, a subsidiary
undertaking within the meaning of section 258 of the Companies Act 1985, but in this Agreement
“Subsidiary” shall:

	 	(a)	 	for all purposes, other than in relation to Clause 21 (Financial covenants), exclude
Britvic provided that if at any time after the date of this Agreement the Company obtains
or acquires, directly or indirectly, 75 per cent. or more of the ordinary issued share
capital of Britvic, Britvic shall become a Subsidiary for all purposes under this
Agreement; and
	 
	 	(b)	 	for all purposes exclude each Project Group Member.

	 	 	“Syndication Date” has the meaning given to that term in the Mandate Letter.
	 
	 	 	“TARGET” means Trans-European Automated Real-time Gross Settlement Express Transfer payment system.
	 
	 	 	“TARGET Day” means any day on which TARGET is open for the settlement of payments in euro.
	 
	 	 	“Tax” means any tax, levy, impost, duty or other charge or withholding of a similar nature
(including any penalty or interest payable in connection with any failure by an Obligor to pay or
any delay in paying by an Obligor any of the same).
	 
	 	 	“Taxes Act” means the Income and Corporation Taxes Act 1988.
	 
	 	 	“Termination Date” means:

	 	(a)	 	in relation to Facility A, the date which is 60 Months after the date of this
Agreement; and
	 
	 	(b)	 	in relation to Facility B, subject to Clause 7.3 (Term Out Option), the date which is
364 days after the date of this Agreement.

	 	 	“Term Loan” means any Facility B Loan converted to a term loan pursuant to the Term Out Option.
	 
	 	 	“Term Out Date” means the date on which the exercise of the Term Out Option has or shall become
effective.
	 
	 	 	“Term Out Notice” has the meaning given to that term in Clause 7.3 (Term Out Option).

12

 

	 	 	“Term Out Option” means the term out option set out in Clause 7.3 (Term Out Option).
	 
	 	 	“Total Commitments” means the aggregate of the Total Facility A Commitments and the Total Facility
B Commitments being £1,600,000,000 at the date of this Agreement.
	 
	 	 	“Total Facility A Commitments” means the aggregate of the Facility A Commitments, being
£1,100,000,000 at the date of this Agreement.
	 
	 	 	“Total Facility B Commitments” means the aggregate of the Facility B Commitments, being
£500,000,000 at the date of this Agreement.
	 
	 	 	“Transfer Certificate” means a certificate substantially in the form set out in Schedule 5 (Form of
Transfer Certificate) or a recommended form of the LMA or any other form agreed between the Agent
and the Company.
	 
	 	 	“Transfer Date” means, in relation to a transfer, the later of:

	 	(a)	 	the proposed Transfer Date specified in the Transfer Certificate; and

	 
	 	(b)	 	the date on which the Agent executes the Transfer Certificate.

	 	 	“Unpaid Sum” means any sum due and payable but unpaid by an Obligor under the Finance Documents.
	 
	 	 	“US Dollars” or “$” means the lawful currency for the time being of the United States of America.
	 
	 	 	“Utilisation” means a utilisation of a Facility.

	 
	 	 	“Utilisation Date” means the date of a Utilisation, being the date on which the relevant Loan is to
be made.
	 
	 	 	“Utilisation Request” means a notice substantially in the form set out in Part I of Schedule 3
(Utilisation Request).
	 
	 	 	“VAT” means value added tax as provided for in the Value Added Tax Act 1994
and any other tax of a similar nature.

	1.2	 	Construction
	 
	(a)	 	Unless a contrary indication appears, any reference in this Agreement to:

	 	(i)	 	the “Agent”, the “Arranger”,
any “Finance Party”, any “Guarantor”,
any “Lender”, any “Obligor” or any “Party” shall be construed so as to include its
successors in title, permitted assigns and permitted transferees;
	 
	 	(ii)	 	“assets” includes present and future properties, revenues and rights
of every description;
	 
	 	(iii)	 	“Barclays Capital” is a reference to the investment banking division
of Barclays Bank PLC.
	 
	 	(iv)	 	a “Finance Document” or any other agreement or instrument is a
reference to that Finance Document or other agreement or instrument as amended or
novated;
	 
	 	(v)	 	“indebtedness” includes any obligation (whether incurred as principal
or as surety) for the payment or repayment of money, whether present or future,
actual or contingent;

13

 

	 	(v)	 	a “person” includes any person, firm, company, corporation, government, state or
agency of a state or any association, trust or partnership (whether or not having separate
legal personality) or two or more of the foregoing;
	 
	 	(vii)	 	a “regulation” includes any regulation, rule, official directive, request or
guideline (whether or not having the force of law but, if not having the force of law,
which is generally complied with by those to whom it is addressed) of any governmental,
intergovernmental or supranational body, agency, department or regulatory, self-regulatory or other authority or organisation;
	 
	 	(viii)	 	“SG Corporate & Investment Banking” is a reference to the corporate and investment
banking division of Société Générale;
	 
	 	(ix)	 	a “subsidiary” has the meaning given to it in section 736 of the Companies Act 1985
and “subsidiary undertaking” has the same meaning given to it in section 258 of the
Companies Act 1985;
	 
	 	(x)	 	a provision of law is a reference to that provision as amended or re-enacted; and

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

	(b)	 	Section, Clause and Schedule headings are for ease of reference only.
	 
	(c)	 	Unless a contrary indication appears, a term used in any other Finance Document or in
any notice given under or in connection with any Finance Document has the same meaning in
that Finance Document or notice as in this Agreement.
	 
	(d)	 	A Default or an Event of Default is “continuing” if it has not been remedied or
waived.

	1.3	 	Third Party Rights

	 	 	A person who is not a Party has no right under the Contracts (Rights of Third
Parties) Act 1999 to enforce or to enjoy the benefit of any term of this Agreement.

14

 

SECTION 2

THE FACILITIES

	2.	 	THE FACILITIES
	 
	2.1	 	The Facilities
	 
	 	 	Subject to the terms of this Agreement, the Lenders make available to the Borrowers:

	 	(a)	 	a multicurrency revolving loan facility in an aggregate amount equal
to the Total Facility A Commitments; and
	 
	 	(b)	 	a multicurrency revolving loan facility with a term out option in an
aggregate amount equal to the Total Facility B Commitments.

	2.2	 	Finance Parties’ rights and obligations
	 
	(a)	 	The obligations of each Finance Party under the Finance Documents are several.
Failure by a Finance Party to perform its obligations under the Finance Documents does not
affect the obligations of any other Party under the Finance Documents. No Finance Party is
responsible for the obligations of any other Finance Party under the Finance Documents.
	 
	(b)	 	The rights of each Finance Party under or in connection with the Finance Documents
are separate and independent rights and any debt arising under the Finance Documents to a
Finance Party from an Obligor shall be a separate and independent debt.
	 
	(c)	 	A Finance Party may, except as otherwise stated in the Finance Documents, separately
enforce its rights under the Finance Documents.

	3.	 	PURPOSE
	 
	3.1	 	Purpose
	 
	(a)	 	Each Borrower shall apply all amounts borrowed by it under Facility A towards general
corporate purposes of the Group.
	 
	(b)	 	Each Borrower shall apply all amounts borrowed by it under Facility B towards
bridging sources of refinancing (including proceeds from the disposal program set out in
the Information Memorandum).
	 
	3.2	 	Monitoring
	 
	 	 	No Finance Party is bound to monitor or verify the application of any amount borrowed
pursuant to this Agreement.

	4.	 	CONDITIONS OF UTILISATION

	 
	4.1	 	Initial conditions precedent
	 
	 	 	No Borrower may deliver a Utilisation Request unless the Agent has received all of the
documents and other evidence listed in Part I of Schedule 2 (Conditions Precedent) which
shall be in form and substance reasonably satisfactory to the Agent. The Agent shall notify
the Company and the Lenders promptly upon being so satisfied.

15

 

	4.2	 	Further conditions precedent
	 
	(a)	 	The Lenders will only be obliged to comply with Clause 5.4 (Lenders’ participation)
if on the date of the Utilisation Request and on the proposed Utilisation Date:

	 	(i)	 	in the case of a Rollover Loan, no Event of Default is continuing or
would result from the proposed Loan and, in the case of any other Loan, no Default
is continuing or would result from the proposed Loan; and
	 
	 	(ii)	 	the Repeating Representations to be made by each Obligor are true in
all material respects.

	(b)	 	The Lenders will only be obliged to comply with Clause 6.3 (Change of currency) if,
on the first day of an Interest Period, no Default is continuing or would result from the
change of currency and the Repeating Representations to be made by each Obligor are true
in all material respects.
	 
	4.3	 	Conditions relating to Optional Currencies
	 
	(a)	 	A currency will constitute an Optional Currency in relation to a Loan if it is euro
or US Dollars or:

	 	(i)	 	it is readily available in the amount required and freely convertible
into the Base Currency in the Relevant Interbank Market on the Quotation Day and
the Utilisation Date for that Loan; and
	 
	 	(ii)	 	it has been approved by the Agent (acting on the instructions of all
the Lenders) on or prior to receipt by the Agent of the relevant Utilisation
Request or Selection Notice for that Loan.

	(b)	 	If by the Specified Time the Agent has received a written request from the Company
for a currency to be approved under paragraph (a)(ii) above, the Agent will notify the
Lenders of that request by the Specified Time. Based on any responses received by the
Agent by the Specified Time, the Agent will confirm to the Company by the Specified Time:

	 	(i)	 	whether or not the Lenders have granted their approval; and
	 
	 	(ii)	 	if approval has been granted, the minimum amount (and, if required,
integral multiples) for any subsequent Utilisation in that currency.

	4.4	 	Maximum number of Loans
	 
	(a)	 	A Borrower may not deliver a Utilisation Request if as a result of the proposed
Utilisation:

	 	(i)	 	more than 14 Facility A Loans would be outstanding; or

	 
	 	(ii)	 	more than 6 Facility B Loans would be outstanding.

	(b)	 	A Borrower may not request that a Term Loan be divided if, as a result of the
proposed division, more than 6 Term Loans would be outstanding.
	 
	(c)	 	Any Loan made by a single Lender under Clause 6.2 (Unavailability of a currency)
shall not be taken into account in this Clause 4.4.

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SECTION 3

UTILISATION

	5.	 	UTILISATION
	 
	5.1	 	Delivery of a Utilisation Request
	 
	 	 	A Borrower may utilise a Facility by delivery to the Agent of a duly completed Utilisation
Request not later than the Specified Time.

	5.2	 	Completion of a Utilisation Request
	 
	(a)	 	Each Utilisation Request is irrevocable and will not be regarded as having been duly
completed unless:

	 	(i)	 	it identifies the Facility to be utilised;
	 
	 	(ii)	 	the proposed Utilisation Date is a Business Day within the
Availability Period applicable to that Facility;
	 
	 	(iii)	 	the currency and amount of the Utilisation comply with Clause 5.3
(Currency and amount);
	 
	 	(iv)	 	the proposed Interest Period complies with Clause 10 (Interest
Periods); and
	 
	 	(v)	 	it specifies the account and bank (which must be in the principal
financial centre of the country of the currency of the Utilisation or, in the case
of euro, the principal financial centre of a Participating Member State in which
banks are open for general business on that day or London or, such other financial
centre as the relevant Borrower, with the consent of the Agent, may select) to
which the proceeds of the Utilisation are to be credited.

	(b)	 	Only one Loan may be requested in each Utilisation Request.
	 
	5.3	 	Currency and amount
	 
	(a)	 	The currency specified in a Utilisation Request must be the Base Currency or an
Optional Currency.
	 
	(b)	 	The amount of the proposed Loan must be:

	 	(i)	 	if the currency selected is the Base Currency, a minimum of
£10,000,000 and in multiples of £1,000,000, or if less, the Available Facility;
	 
	 	(ii)	 	if the currency selected is US Dollars, a minimum of $20,000,000 and
in multiples of $1,000,000, or, if less the Available Facility; or
	 
	 	(iii)	 	if the currency selected is euro, a minimum of
€20,000,000, and in
multiples of €1,000,000, or if less, the Available Facility; or
	 
	 	(iv)	 	if the currency selected is an Optional Currency other than US
Dollars or euro, the minimum amount (and, if required, integral multiple) as
agreed between the Agent, the Lenders and the Company provided that if no such
agreement is reached between the Agent, the Lenders and the Company the minimum
amount shall be the equivalent at

17

 

	 	 	 	that time of £10,000,000 and multiples of £1,000,000, such amount to be rounded as
reasonably determined by the Agent and notified to the Company; and

	 	(v)	 	in any event such that its Base Currency Amount is less than or equal to the
Available Facility.

	5.4	 	Lenders’ participation
	 
	(a)	 	If the conditions set out in this Agreement have been met, each Lender shall make its
participation in each Loan available by the Utilisation Date through its Facility Office.
	 
	(b)	 	The amount of each Lender’s participation in each Loan will be equal to the
proportion borne by its Available Commitment to the Available Facility immediately prior
to making the Loan.
	 
	(c)	 	The Agent shall determine the Base Currency Amount of each Loan which is to be made
in an Optional Currency and shall notify each Lender of the amount, currency and the Base
Currency Amount of each Loan and the amount of its participation in that Loan, in each
case by the Specified Time.
	 
	6.	 	OPTIONAL CURRENCIES

	 
	6.1	 	Selection of currency
	 
	(a)	 	A Borrower (or the Company on behalf of a Borrower) shall select the currency of a
Loan:

	 	(i)	 	(in the case of an initial Utilisation) in a Utilisation Request; and
	 
	 	(ii)	 	(in relation to a Term Loan after the initial Utilisation) in a
Selection Notice.

	(b)	 	If a Borrower (or the Company on behalf of a Borrower) fails to issue a Selection
Notice in relation to a Term Loan, it shall be deemed to have requested that the Loan will
remain denominated for its next Interest Period in the same currency in which it is then
outstanding.
	 
	(c)	 	If a Borrower (or the Company on behalf of a Borrower) issues a Selection Notice
requesting a change of currency and the first day of the requested Interest Period is not
a Business Day for the new currency, the Agent shall promptly notify the Company, the
relevant Borrower and the Lenders and the Loan will remain in the existing currency (with
Interest Periods running from one Business Day until the next Business Day) until the next
day which is a Business Day for both currencies, on which day the requested Interest
Period will begin.
	 
	6.2	 	Unavailability of a currency
	 
	 	 	If before the Specified Time on any Quotation Day:

	 	(a)	 	a Lender notifies the Agent that the Optional Currency requested is
not readily available to it in the amount required; or
	 
	 	(b)	 	a Lender notifies the Agent that compliance with its obligation to
participate in a Loan in the proposed Optional Currency would contravene a law or
regulation applicable to it,

	 	 	the Agent will give notice to the relevant Borrower to that effect by the Specified Time on
that day. In this event, any Lender that gives notice pursuant to this Clause 6.2 will be
required to participate in the Loan in the Base Currency (in an amount equal to that
Lender’s proportion of the Base Currency Amount or, in respect of a Rollover Loan, an
amount equal to that Lender’s proportion of the Base Currency Amount of the Rollover Loan
that is due to be made) and its

18

 

	 	 	participation will be treated as a separate Loan denominated in the Base Currency during
that Interest Period.

	6.3	 	Change of currency
	 
	(a)	 	If a Term Loan is to be denominated in different currencies during two successive
Interest Periods:

	 	(i)	 	if the currency for the second Interest Period is an Optional
Currency, the amount of the Loan in that Optional Currency will be calculated by
the Agent as the amount of that Optional Currency equal to the Base Currency
Amount of the Loan at the Agent’s Spot Rate of Exchange at the Specified Time;
	 
	 	(ii)	 	if the currency for the second Interest Period is the Base Currency,
the amount of the Loan will be equal to the Base Currency Amount;
	 
	 	(iii)	 	(unless the Agent and the Borrower agree otherwise in accordance
with paragraph (b) below) the Borrower that has borrowed the Loan shall repay it
on the last day of the first Interest Period in the currency in which it was
denominated for that Interest Period; and
	 
	 	(iv)	 	(subject to Clause 4.2 (Further conditions precedent)) the Lenders
shall re-advance the Loan in the new currency in accordance with Clause 6.5
(Agent’s calculations).

	(b)	 	If the Agent and the Borrower that has borrowed the Term Loan agree, the Agent shall:

	 	(i)	 	apply the amount paid to it by the Lenders pursuant to paragraph
(a)(iv) above (or so much of that amount as is necessary) in or towards purchase
of an amount in the currency
in which the Term Loan is outstanding for the first Interest Period; and
	 
	 	(ii)	 	use the amount it purchases in or towards satisfaction of the
relevant Borrower’s obligations under paragraph (a)(iii) above.

	(c)	 	If the amount purchased by the Agent pursuant to paragraph (b)(i) above is less than
the amount required to be repaid by the relevant Borrower, the Agent shall promptly notify
that Borrower and that Borrower shall, on the last day of the first Interest Period, pay
an amount to the Agent (in the currency of the outstanding Term Loan for the first
applicable Interest Period) equal to the difference.
	 
	(d)	 	If any part of the amount paid to the Agent by the Lenders pursuant to paragraph
(a)(iv) above is not needed to purchase the amount required to be repaid by the relevant
Borrower, the Agent shall promptly notify that Borrower and pay that Borrower, on the last
day of the first Interest Period that part of that amount (in the new currency).

	6.4	 	Same Optional Currency during successive Interest Periods
	 
	(a)	 	If a Term Loan is to be denominated in the same Optional Currency during two
successive Interest Periods, the Agent shall calculate the amount of any Term Loan in the
Optional Currency for the second of those Interest Periods (by calculating the amount of
Optional Currency equal to the Base Currency Amount of that Term Loan at the Agent’s Spot
Rate of Exchange at the Specified Time) and (subject to paragraph (b) below):

	 	(i)	 	if the amount calculated is less than the existing amount of that
Term Loan in the Optional Currency during the first Interest Period, promptly
notify the Borrower that has

19

 

	 	 	 	borrowed that Term Loan and that Borrower shall pay, on the last day of the first
Interest Period, an amount equal to the difference; or

	 	(ii)	 	if the amount calculated is more than the existing amount of that
Term Loan in the Optional Currency during the first Interest Period, promptly
notify each Lender and, if no Event of Default is continuing, each Lender shall,
on the last day of the first Interest Period, pay its participation in an amount
equal to the difference.

	(b)	 	If the calculation made by the Agent pursuant to paragraph (a) above shows that the
amount of the Term Loan in the Optional Currency for the second of those Interest Periods
converted into the Base Currency at the Agent’s Spot Rate of Exchange at the Specified
Time has increased or decreased by less than 5 per cent. compared to its Base Currency
Amount (taking into account any payments made pursuant to paragraph (a) above), no
notification shall be made by the Agent and no payment shall be required under paragraph
(a) above.
	 
	6.5	 	Agent’s calculations
	 
	(a)	 	All calculations made by the Agent pursuant to this Clause 6 will take into account
any repayment, prepayment, consolidation or division of Term Loans to be made on the last
day of the first Interest Period.
	 
	(b)	 	Each Lender’s participation in a Loan will, subject to paragraph (a) above, be
determined in accordance with paragraph (b) of Clause 5.4 (Lenders’ participation).

20

 

SECTION 4

REPAYMENT, PREPAYMENT AND CANCELLATION

	7.	 	REPAYMENT
	 
	7.1	 	Repayment of Facility A Loans
	 
	 	 	Each Borrower which has drawn a Facility A Loan shall repay that Facility A Loan on the
last day of its Interest Period.

	7.2	 	Repayment of Facility B Loans
	 
	(a)	 	Subject to Clause 7.3 (Term Out Option), each Borrower which has drawn a Facility B
Loan shall repay that Facility B Loan on the last day of its Interest Period.
	 
	(b)	 	Each Borrower shall repay each Term Loan made to it on the Final Facility B
Termination Date.
	 
	7.3	 	Term Out Option
	 
	(a)	 	The Company may elect to convert all or part of the Facility B Loans into Term Loans.
	 
	(b)	 	The Company may exercise the term out option by not less than 5 Business Days notice
(substantially in the form set out in Schedule 12 (Form of Term Out Notice)) (the “Term
Out Notice”) to the Agent. Only one such notice may be given and such notice is
irrevocable.
	 
	(c)	 	That notice shall specify the Facility B Loan(s) in relation to which the Term Out
Option is being exercised and the proposed Term Out Date (which shall be a date on or
prior to the original Termination Date relating to Facility B).
	 
	(d)	 	The Agent shall promptly notify each Lender of the Facility B Loans specified in the
Term Out Notice.
	 
	(e)	 	If the Term Out Option is so exercised and the matters set out in paragraph (f) below
are satisfied, then on the Term Out Date:

	 	(i)	 	the Facility B Loan(s) to be converted shall
be converted into Term Loan(s);
	 
	 	(ii)	 	any Available Commitment under Facility B shall be
automatically cancelled;
	 
	 	(iii)	 	the Termination Date for Facility B shall be extended to
the date which is 24 Months from
the date of this Agreement; and
	 
	 	(iv)	 	the fee specified in Clause 12.4 (Term Out fee) shall become due and payable.

	(f)	 	The following must be satisfied on the Term Out Date for the Term Out Option to be
effected as specified in (e) above:

	 	(i)	 	the Repeating Representations are true in all material respects; and
	 
	 	(ii)	 	no Default is continuing or would result from the Facility B Loan(s)
being converted into Term Loan(s).

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	8.	 	PREPAYMENT AND CANCELLATION

	 
	8.1	 	Illegality
	 
	 	 	If it becomes unlawful in any applicable jurisdiction for a Lender to perform any of its
obligations as contemplated by this Agreement or to fund or maintain its participation in
any Loan:

	 	(a)	 	that Lender shall promptly notify the Agent upon becoming aware of
that event;
	 
	 	(b)	 	upon the Agent notifying the Company, the Commitment of that Lender
will be immediately cancelled; and
	 
	 	(c)	 	each Borrower shall repay that Lender’s participation in the Loans
made to that Borrower on the last day of the Interest Period for each Loan
occurring after the Agent has notified the Company or, if earlier, the date
specified by the Lender in the notice delivered to the Agent (being no earlier
than the last day of any applicable grace period permitted by law).

	8.2	 	Change of control
	 
	(a)	 	If at any time before the New Parent Scheme Date (excluding for this purpose
paragraph (c) of such definition) any person or group of persons acting in concert gains
control of IHG (other than as a result of, or in connection with, the New Parent Scheme):

	 	(i)	 	IHG shall promptly notify the Agent upon becoming aware of that event;
	 
	 	(ii)	 	a Lender shall not be obliged to fund a Utilisation (except for a
Rollover Loan); and
	 
	 	(iii)	 	if a Lender so requires and notifies the Agent within 30 days of IHG
notifying the Agent of the event, the Agent shall, by not less than 30 days’
notice to IHG, cancel the Commitment of that Lender and declare the participation
of that Lender in all outstanding Loans, together with accrued interest, and all
other amounts accrued under the Finance Documents immediately due and payable,
whereupon the Commitment of that Lender will be cancelled and all such outstanding
amounts will become immediately due and payable.

	(b)	 	If at any time after the New Parent Scheme Date (excluding for this purpose paragraph
(c) of such definition) any person or group of persons acting in concert gains control of
the New Parent:

	 	(i)	 	the New Parent shall promptly notify the Agent upon becoming aware of
that event;
	 
	 	(ii)	 	a Lender shall not be obliged to fund a Utilisation (except for a
Rollover Loan); and
	 
	 	(iii)	 	if a Lender so requires and notifies the Agent within 30 days of the
New Parent notifying the Agent of the event, the Agent shall, by not less than 30
days’ notice to the New Parent, cancel the Commitment of that Lender and declare
the participation of that Lender in all outstanding Loans, together with accrued
interest, and all other amounts accrued under the Finance Documents immediately
due and payable, whereupon the Commitment of that Lender will be cancelled and all
such outstanding amounts will become immediately due and payable.

	(c)	 	For the purpose of paragraphs (a) and (b) above “control” has the meaning given to it
in section 840 of the Taxes Act.

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	(d)	 	For the purpose of paragraph (a) and (b) above “acting in concert” has the meaning
given to it in the City Code on Takeovers and Mergers.

	8.3	 	Voluntary cancellation
	 
	 	 	The Company may, if it gives the Agent not less than 5 Business Days’ (or such shorter
period as the Majority Lenders may agree) prior notice in writing, cancel the whole or any
part (being a minimum amount of £20,000,000 and in multiples of £5,000,000) of an Available
Facility. Any cancellation under this Clause 8.3 shall reduce the Commitments of the
Lenders rateably under that Facility.

	8.4	 	Voluntary prepayment
	 
	 	 	A Borrower to which a Loan has been made, may, if it gives the Agent not less than 5
Business Days (or such shorter period as the Majority Lenders may agree) prior notice in
writing, prepay the whole or any part of a Loan (but, if in part, being an amount that
reduces the Base Currency Amount of the Loan by a minimum amount of £20,000,000 and in
multiples of £5,000,000).

	8.5	 	Right of repayment and cancellation in relation to a single Lender
	 
	(a)	 	If:

	 	(i)	 	any sum payable to any Lender by an Obligor is required to be increased under
paragraph (c) of Clause 13.2 (Tax gross-up);
	 
	 	(ii)	 	any Lender claims indemnification from the Company under Clause 13.3 (Tax indemnity)
or Clause 14.1 (Increased costs); or
	 
	 	(iii)	 	any Lender notifies the Agent of its Additional Cost Rate under paragraph 3 of Schedule
4 (Mandatory Cost formulae),

	 	 	the Company may, whilst (in the case of paragraphs (i) and (ii) above) the circumstance giving
rise to the requirement or indemnification continues, or (in the case of paragraph (iii) above) that
Additional Cost Rate is greater than zero, give the Agent notice of cancellation of the
Commitment of that Lender and/or its intention to procure the repayment of that Lender’s
participation in the Loans.

	(b)	 	On receipt of a notice referred to in paragraph (a) above, the Commitment of that Lender shall
immediately be reduced to zero.
	 
	(c)	 	On the last day of each Interest Period which ends after the Company has given notice under
paragraph (a) above (or, if earlier, the date specified by the Company in that notice), each
Borrower (or, as the case may be, the specified Borrower) to which a Loan is outstanding shall
repay that Lender’s participation in that Loan.
	 
	8.6	 	Restrictions
	 
	(a)	 	Any notice of cancellation or prepayment given by any Party under this Clause 8 shall
be irrevocable and, unless a contrary indication appears in this Agreement, shall specify
the date or dates upon which the relevant cancellation or prepayment is to be made and the
amount of that cancellation or prepayment.
	 
	(b)	 	Any prepayment under this Agreement shall be made together with accrued interest on
the amount prepaid and, subject to any Break Costs, without premium or penalty.
	 
	(c)	 	No Borrower may reborrow all or any part of a Term Loan which is prepaid or repaid.

23

 

	(d)	 	Unless a contrary indication appears in this Agreement, any part of Facility A which
is prepaid or any part of Facility B which is prepaid prior to the Term Out Date may be
reborrowed in accordance with the terms of this Agreement.
	 
	(e)	 	The Borrowers shall not repay or prepay all or any part of the Loans or cancel all or
any part of the Commitments except at the times and in the manner expressly provided for
in this Agreement.
	 
	(f)	 	No amount of the Total Commitments cancelled under this Agreement may be subsequently
reinstated.
	 
	(g)	 	If the Agent receives a notice under this Clause 8 it shall promptly forward a copy
of that notice to either the Company or the affected Lender, as appropriate.

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SECTION 5

COSTS OF UTILISATION

	9.	 	INTEREST

	 
	9.1	 	Calculation of interest
	 
	 	 	The rate of interest on each Loan for each Interest Period is the percentage rate per annum which is the aggregate of the applicable:

	 	(a)	 	Margin;
	 
	 	(b)	 	LIBOR or, in relation to any Loan in euro, EURIBOR; and
	 
	 	(c)	 	Mandatory Cost, if any.

	9.2	 	Payment of interest
	 
	 	 	The Borrower to which a Loan has been made shall pay accrued interest on that Loan on the
last day of each Interest Period (and, if the Interest Period is longer than six Months, on
the dates falling at six monthly intervals after the first day of the Interest Period).

	9.3	 	Default interest
	 
	(a)	 	If an Obligor fails to pay any amount payable by it under a Finance Document on its
due date, interest shall accrue on the overdue amount from the due date up to the date of
actual payment (both before and after judgment) at a rate which, subject to paragraph (b)
below, is the sum of 1 per cent. and the rate which would have been payable if the overdue
amount had, during the period of non-payment, constituted a Loan in the currency of the
overdue amount for successive Interest Periods, each of a duration selected by the Agent
(acting reasonably). Any interest accruing under this Clause 9.3 shall be immediately
payable by the Obligor on demand by the Agent.
	 
	(b)	 	If any overdue amount consists of all or part of a Loan which became due on a day
which was not the last day of an Interest Period relating to that Loan:

	 	(i)	 	the first Interest Period for that overdue amount shall have a
duration equal to the unexpired portion of the current Interest Period relating to
that Loan; and
	 
	 	(ii)	 	the rate of interest applying to the overdue amount during that first
Interest Period shall be the sum of 1 per cent. and the rate which would have
applied if the overdue amount had not become due.

	(c)	 	Default interest (if unpaid) arising on an overdue amount will be compounded with the
overdue amount at the end of each Interest Period applicable to that overdue amount but
will remain immediately due and payable.
	 
	9.4	 	Notification of rates of interest
	 
	 	 	The Agent shall promptly notify the Lenders and the relevant Borrower of the determination
of a rate of interest under this Agreement.

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	10.	 	INTEREST PERIODS
	 
	10.1	 	Selection of Interest Periods
	 
	(a)	 	A Borrower (or the Company on behalf of a Borrower) may select an Interest Period for
a Loan in the Utilisation Request for that Loan or (if the Loan has already been borrowed)
in a Selection Notice.
	 
	(b)	 	Each Selection Notice for a Term Loan is irrevocable and must be delivered to the
Agent by the Borrower (or the Company on behalf of the Borrower) to which that Term Loan
was made not later than the Specified Time.
	 
	(c)	 	If a Borrower (or the Company) fails to deliver a Selection Notice to the Agent in
accordance with paragraph (b) above, the relevant Interest Period will be one Month.
	 
	(d)	 	Subject to this Clause 10, a Borrower (or the Company) may select an Interest Period
of 1, 2, 3 or 6 Months or any other period agreed between the Company and the Agent
(acting on the instructions of all the Lenders).
	 
	(e)	 	An Interest Period for:

	 	(i)	 	a Loan shall not extend beyond the Termination Date applicable to its
Facility; and
	 
	 	(ii)	 	for a Term Loan shall not extend beyond the Final Facility B
Termination Date.

	(f)	 	Each Interest Period for a Term Loan shall start on the Utilisation Date or (if
already made) on the last day of its preceding Interest Period.
	 
	(g)	 	A Facility A Loan and a Facility B Loan prior to the Term Out Date has one Interest
Period only.
	 
	10.2	 	Non-Business Days
	 
	 	 	If an Interest Period would otherwise end on a day which is not a Business Day, that
Interest Period will instead end on the next Business Day in that calendar month (if there
is one) or the preceding Business Day (if there is not).

	10.3	 	Consolidation and division of Term Loans
	 
	(a)	 	Subject to paragraph (b) below, if two or more Interest Periods:

	 	(i)	 	relate to Term Loans in the same currency;
	 
	 	(ii)	 	end on the same date; and
	 
	 	(iii)	 	are made to the same Borrower,

	 	 	the relevant Term Loans will, unless that Borrower (or the Company on its behalf) specifies
to the contrary in the Selection Notice for the next Interest Period, be consolidated into,
and treated as, a single Term Loan on the last day of the Interest Period.

	(b)	 	Subject to Clause 4.4 (Maximum number of Loans) and Clause 5.3 (Currency and amount),
if a Borrower (or the Company on its behalf) requests in a Selection Notice that a Term
Loan be divided into two or more respective Term Loans that Term Loan will, on the last
day of its Interest Period, be so divided with Base Currency Amounts specified in that
Selection Notice, being an aggregate Base Currency Amount equal to the Base Currency
Amount of the respective Term Loan immediately before its division.

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	11.	 	CHANGES TO THE CALCULATION OF INTEREST

	 
	11.1	 	Absence of quotations
	 
	 	 	Subject to Clause 11.2 (Market disruption), if LIBOR or, if applicable, EURIBOR is to be
determined by reference to the Reference Banks but a Reference Bank does not supply a
quotation by the Specified Time on the Quotation Day, the applicable LIBOR or EURIBOR shall
be determined on the basis of the quotations of the remaining Reference Banks.

	11.2	 	Market disruption
	 
	(a)	 	If a Market Disruption Event occurs in relation to a Loan for any Interest Period,
then the rate of interest on each Lender’s share of that Loan for the Interest Period
shall be the rate per annum which is the sum of:

	 	(i)	 	the applicable Margin;
	 
	 	(ii)	 	the rate notified to the Agent by that Lender as soon as practicable
and in any event before interest is due to be paid in respect of that Interest
Period, to be that which expresses as a percentage rate per annum the cost to that
Lender of funding its participation in that Loan from whatever source it may
reasonably select; and
	 
	 	(iii)	 	the Mandatory Cost, if any, applicable to that Lender’s
participation in the Loan.

	(b)	 	In this Agreement “Market Disruption Event” means:

	 	(i)	 	at or about noon on the Quotation Day for the relevant Interest
Period the Screen Rate is not available and none or only one of the Reference
Banks supplies a rate to the Agent to determine LIBOR or, EURIBOR for the relevant
currency and Interest Period; or
	 
	 	(ii)	 	before close of business in London on the Quotation Day for the
relevant Interest Period, the Agent receives notifications from a Lender or
Lenders (whose participations in a Loan exceed 35 per cent. of that Loan) that the
cost to it of obtaining matching deposits in the Relevant Interbank Market would
be in excess of LIBOR or, if applicable, EURIBOR.

	11.3	 	Alternative basis of interest or funding
	 
	(a)	 	If a Market Disruption Event occurs and the Agent or the Company so requires, the Agent and
the Company shall enter into negotiations (for a period of not more than thirty days) with a view
to agreeing a substitute basis for determining the rate of interest.
	 
	(b)	 	Any alternative basis agreed pursuant to paragraph (a) above shall, with the prior consent of all
the Lenders and the Company, be binding on all Parties.
	 
	11.4	 	Break Costs
	 
	(a)	 	Each Borrower shall, within five Business Days of a demand by a Finance Party, pay to
that Finance Party its Break Costs attributable to all or any part of a Loan or Unpaid Sum
being paid by that Borrower on a day other than the last day of an Interest Period for
that Loan or Unpaid Sum.
	 
	(b)	 	Each Lender shall, together with its demand provide a certificate confirming the
amount and basis of calculation of its Break Costs for any Interest Period in which they
accrue.

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	12.	 	FEES

	 
	12.1	 	Commitment fee
	 
	(a)	 	The Company shall pay to the Agent (for the account of each Lender) a fee in the Base
Currency computed on a day to day basis at a percentage rate per annum equal to:

	 	(i)	 	40 per cent. of the relevant Margin which would apply to a Facility A
Loan drawn on that day on that Lender’s Available Commitment under Facility A for
the Availability Period applicable to Facility A; and
	 
	 	(ii)	 	30 per cent. of the relevant Margin which would apply to a Facility B
Loan drawn on that day on that Lender’s Available Commitment under Facility B for
the Availability Period applicable to Facility B.

	(b)	 	The accrued commitment fee is payable on the last day of each successive period of
three Months which ends during the relevant Availability Period, on the last day of the
Availability Period and, if cancelled in full, on the cancelled amount of the relevant
Lender’s Available Commitment at the time the cancellation is effective.
	 
	12.2	 	Arrangement, underwriting and syndication fees
	 
	 	 	The Company shall pay, or procure that the same is paid, to the Arranger (for its own
account) an arrangement fee and (for its own account and the account of the Lenders as
applicable) an underwriting and syndication fee each in the amount and at the times agreed
in the Mandate Letter.

	12.3	 	Agency fee
	 
	 	 	The Company shall pay, or procure that the same is paid, to the Agent (for its own account)
an agency fee in the amount and at the times agreed in the Agency Fee Letter.

	12.4	 	Term Out fee
	 
	 	 	The Company shall pay to the Agent (for the account of each Lender) a term out fee in the
Base Currency in an amount equal to 0.05 per cent. flat on that Lender’s participation in
the Base Currency Amount of the Facility B Loan(s) in relation to which the Term Out Option
has been exercised, such fee to be paid on the Term Out Date.

28

 

SECTION 6

ADDITIONAL PAYMENT OBLIGATIONS

	13.	 	TAX GROSS UP AND INDEMNITIES
	 
	13.1	 	Definitions
	 
	(a)	 	In this Agreement:
	 
	 	 	“Protected Party” means a Finance Party which is or will be subject to any liability, or
required to make any payment, for or on account of Tax in relation to a sum received or
receivable (or any sum deemed for the purposes of Tax to be received or receivable) under a
Finance Document.
	 
	 	 	“Qualifying Lender” means:

	 	(i)	 	a Lender (other than a lender within sub-paragraph (B) below) which
is beneficially entitled to interest payable to that Lender in respect of an
advance under a Finance Document and is:

	 	(A)	 	a Lender:

	 	1.	 	which is a bank (as defined for the
purpose of section 349 of the Taxes Act) making an advance under
a Finance Document; or
	 
	 	2.	 	in respect of an advance made under
a Finance Document by a person that was a bank (as defined for
the purpose of section 349 of the Taxes Act) at the time that
that advance was made,

	 	 	 	and which is within the charge to United Kingdom corporation tax as
respects any payments of interest made in respect of that advance; or

	 	(B)	 	a Lender which is:

	 	1.	 	a company resident in the United
Kingdom for United Kingdom tax purposes;
	 
	 	2.	 	a partnership each member of which
is:

	 	(a)	 	a company so
resident in the United Kingdom; or
	 
	 	(b)	 	a company not so
resident in the United Kingdom which carries on a trade
in the United Kingdom through a permanent establishment
and which brings into account in computing its chargeable
profits (for the purposes of section 11(2) of the Taxes
Act) the whole of any share of interest payable in
respect of that advance that falls to it by reason of
sections 114 and 115 of the Taxes Act; or

	 	3.	 	a company not so resident in the
United Kingdom which carries on a trade in the United Kingdom
through a permanent establishment and which brings into account
interest payable in respect of that advance in computing the
chargeable profits (for the purposes of section 11(2) of the
Taxes Act) of that company; or

	 	(C)	 	a Treaty Lender; or

29

 

	 	(ii)	 	a building society (as defined for the purposes of section 477A of the Taxes Act).

	 	 	“Tax Confirmation” means a confirmation by a Lender that the person beneficially entitled to
interest payable to that Lender in respect of an advance under a Finance Document is either:

	 	(i)	 	a company resident in the United Kingdom for United Kingdom tax purposes; or

	 
	 	(ii)	 	a partnership each member of which is:

	 	(A)	 	a company so resident in the United Kingdom; or
	 
	 	(B)	 	a company not so resident in the United Kingdom which carries on a
trade in the United Kingdom through a permanent establishment and which brings
into account in computing its chargeable profits (for the purposes of section
11(2) of the Taxes Act) the whole of any share of interest payable in respect of
that advance that falls to it by reason of sections 114 and 115 of the Taxes Act;
or

	 	(iii)	 	a company not so resident in the United Kingdom which carries on a trade in the
United Kingdom through a permanent establishment and which brings into account interest
payable in respect of that advance in computing the chargeable profits (for the purposes
of section 11(2) of the Taxes Act) of that company.

	 	 	“Tax Credit” means a credit against, relief or remission for, or repayment of any Tax.
	 
	 	 	“Tax Deduction” means a deduction or withholding for or on account of Tax from a payment under a
Finance Document.
	 
	 	 	“Tax Payment” means the amount by which a payment made by an Obligor to a Finance Party is
increased under Clause 13.2 (Tax gross-up) or a payment under Clause 13.3 (Tax indemnity).
	 
	 	 	“Treaty Lender” means a Lender which:

	 	(i)	 	is treated as a resident of a Treaty State for the purposes of the Treaty;
	 
	 	(ii)	 	does not carry on a business in the United Kingdom through a permanent establishment
with which that Lender’s participation in the Loans is effectively connected; and
	 
	 	(iii)	 	fulfils any conditions which must be fulfilled under the double taxation agreement
for residents of that Treaty State to obtain exemption from United Kingdom taxation on
interest (subject to the completion of any necessary procedural formalities).

	 	 	“Treaty State” means a jurisdiction having a double taxation agreement (a “Treaty”) with the United
Kingdom which makes provision for full exemption from tax imposed by the United Kingdom on
interest.
	 
	 	 	“UK Non-Bank Lender” means where a Lender becomes a Party after the day on which this Agreement is
entered into, a Lender which gives a Tax Confirmation in the Transfer Certificate which it executes
on becoming a Party.
	 
	(b)	 	Unless a contrary indication appears, in this Clause 13 a reference to “determines”
or “determined” means a determination made in the absolute discretion of the person making
the determination.

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	13.2	 	Tax gross-up
	 
	(a)	 	Each Obligor shall make all payments to be made by it without any Tax Deduction,
unless a Tax Deduction is required by law.
	 
	(b)	 	The Company shall promptly upon becoming aware that an Obligor must make a Tax
Deduction (or that there is any change in the rate or the basis of a Tax Deduction) notify
the Agent accordingly. Similarly, a Lender shall promptly notify the Agent on becoming so
aware in respect of a payment payable to that Lender. If the Agent receives such
notification from a Lender it shall promptly notify the Company and that Obligor.
	 
	(c)	 	If a Tax Deduction is required by law to be made by an Obligor, the amount of the
payment due from that Obligor shall be increased to an amount which (after making any Tax
Deduction) leaves an amount equal to the payment which would have been due if no Tax
Deduction had been required.
	 
	(d)	 	An Obligor is not required to make an increased payment to a Lender under paragraph
(c) above for a Tax Deduction in respect of tax imposed by the United Kingdom from a
payment of interest on a Loan, if on the date on which the payment falls due:

	 	(i)	 	the payment could have been made to the relevant Lender without a Tax
Deduction if it was a Qualifying Lender, but on that date that Lender is not or
has ceased to be a Qualifying Lender other than as a result of any change after
the date it became a Lender under this Agreement in (or in the interpretation,
administration, or application of) any law or Treaty, or any published practice or
concession of any relevant taxing authority; or
	 
	 	(ii)	 	     

	 	(A)	 	the relevant Lender is a Qualifying Lender solely under sub-paragraph (i)(B) of the definition of Qualifying Lender;
	 
	 	(B)	 	the Board of the Inland Revenue has given (and not
revoked) a direction (a “Direction”) under Section 349C of the Taxes Act
(as that provision has effect on the date on which the relevant Lender
became a Party) which relates to that
payment and that Lender has received from that Obligor or the Company a
certified copy of that Direction; and
	 
	 	(C)	 	the payment could have been made to the Lender without any Tax Deduction in the absence of that Direction; or

	 	(iii)	 	the relevant Lender is a Qualifying Lender solely under
sub-paragraph (i)(B) of the definition of Qualifying Lender and it has not, other
than by reason of any change after the date of this Agreement in (or in the
interpretation, administration or application of) any law, or any published
practice or concession of any relevant taxing authority, given a Tax Confirmation
to the Company; or
	 
	 	(iv)	 	the relevant Lender is a Treaty Lender and the Obligor making the
payment is able to demonstrate that the payment could have been made to the Lender
without the Tax Deduction had that Lender complied with its obligations under
paragraph (g) below.

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	(e)	 	If an Obligor is required to make a Tax Deduction, that Obligor shall make that Tax
Deduction and any payment required in connection with that Tax Deduction within the time
allowed and in the minimum amount required by law.
	 
	(f)	 	Within thirty days of making either a Tax Deduction or any payment required in
connection with that Tax Deduction, the Obligor making that Tax Deduction shall deliver to
the Agent for the Finance Party entitled to the payment evidence reasonably satisfactory
to that Finance Party that the Tax Deduction has been made or (as applicable) any
appropriate payment paid to the relevant taxing authority.
	 
	(g)	 	A Treaty Lender and each Obligor which makes a payment to which that Treaty Lender is
entitled shall co-operate in promptly completing any procedural formalities (including
completing and submitting appropriate documents to the applicable taxation authorities)
necessary for that Obligor to obtain authorisation to make that payment without a Tax
Deduction.
	 
	(h)	 	A UK Non-Bank Lender shall promptly notify the Company and the Agent if there is any
change in the position from that set out in the Tax Confirmation.
	 
	(i)	 	Each Lender severally warrants to the Company that it is a Qualifying Lender on the
date it becomes a Party to this Agreement. If at any time after this Agreement is entered
into any Lender becomes aware that it is not or will not or will cease to be a Qualifying
Lender, it shall promptly notify the Agent and the Company.
	 
	13.3	 	Tax indemnity
	 
	(a)	 	The Company shall (within five Business Days of demand by the Agent) pay to a
Protected Party an amount equal to the loss, liability or cost which that Protected Party
determines will be or has been (directly or indirectly) suffered for or on account of Tax
by that Protected Party in respect of a Finance Document.
	 
	(b)	 	Paragraph (a) above shall not apply:

	 	(i)	 	with respect to any Tax assessed on a Finance Party:

	 	(A)	 	under the law of the jurisdiction in which that Finance Party is incorporated
or, if different, the jurisdiction (or jurisdictions) in which that Finance Party
is treated as resident for tax purposes; or
	 
	 	(B)	 	under the law of the jurisdiction
in which that Finance Party’s Facility Office is located in respect of amounts
received or receivable in that jurisdiction,

	 	 	 	if that Tax is imposed on or calculated by reference to the net income received or receivable (but not any sum
deemed to be received or receivable) by that Finance Party;
	 
	 	 	 	or

	 	(ii)	 	to the extent a loss, liability or cost:

	 	(A)	 	is compensated for by an increased payment under Clause 13.2 (Tax gross-up);
	 
	 	 	 	or
	 
	 	(B)	 	would have been compensated for by an increased payment under Clause 13.2 (Tax
gross-up) but was not so compensated solely because one of the exclusions in
paragraph (d) of Clause 13.2 (Tax gross-up) applied.

32

 

	(c)	 	A Protected Party making, or intending to make, a claim under paragraph (a) above
shall promptly notify the Agent of the event which will give, or has given, rise to the
claim, following which the Agent shall promptly notify the Company.
	 
	(d)	 	A Protected Party shall, on receiving a payment from an Obligor under this Clause
13.3, notify the Agent.
	 
	13.4	 	Tax Credit
	 
	 	 	If an Obligor makes a Tax Payment and the relevant Finance Party determines that:

	 	(a)	 	a Tax Credit is attributable either to an increased payment of which
that Tax Payment forms part or to that Tax Payment; and
	 
	 	(b)	 	that Finance Party has obtained, utilised and retained that Tax
Credit,

	 	 	the Finance Party shall pay an amount to the Obligor which that Finance Party determines
will leave it (after that payment) in no better and no worse position in respect of its
worldwide tax liabilities than it would have been in had the Tax Payment not been required
to be made by the Obligor.

	13.5	 	Stamp taxes
	 
	 	 	The Company shall pay and, within five Business Days of demand, indemnify each Finance
Party against any cost, loss or liability that Finance Party incurs in relation to all
stamp duty, registration and other similar Taxes payable in respect of any Finance
Document.

	13.6	 	Value added tax
	 
	(a)	 	All amounts set out, or expressed to be payable under a Finance Document by any Party
to a Finance Party which (in whole or part) constitute the consideration for VAT purposes
shall be deemed to be exclusive of any VAT which is chargeable on such supply, and
accordingly, subject to paragraph (c) below, if VAT is chargeable on any supply made by
any Finance Party to any Party under a Finance Document, that Party shall pay to the
Finance Party (in addition to and at the same time as paying the consideration) an amount
equal to the amount of the VAT (and such Finance Party shall promptly provide an
appropriate VAT invoice to such Party).
	 
	(b)	 	If VAT is chargeable on any supply made by any Finance Party (the “Supplier”) to any
other Finance Party (the “Recipient”) under a Finance Document, and any Party (the
“Relevant Party”) is required by the terms of any Finance Document to pay an amount equal
to the consideration for such supply to the Supplier (rather than being required to
reimburse the Recipient in respect of that consideration), such Party shall also pay to
the Supplier (in addition to and at the same time as paying such amount) an amount equal
to the amount of such VAT.
The Recipient will promptly pay to the Relevant Party an amount equal to any credit or
repayment from the relevant tax authority which it reasonably determines relates to the VAT
chargeable on that supply.
	 
	(c)	 	Where a Finance Document requires any Party to reimburse a Finance Party for any
costs or expenses, that Party shall also at the same time pay and indemnify the Finance
Party against all VAT incurred by the Finance Party in respect of the costs or expenses
save to the extent that neither the Finance Party nor any other member of any group of
which it is a member for VAT purposes is entitled to repayment or credit in respect of
such VAT.

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	13.7	 	PTR Scheme
	 
	(a)	 	Each Treaty Lender:

	 	(i)	 	irrevocably appoints the Agent to act as syndicate manager under, and
authorises the Agent to operate, and take any action necessary or desirable under,
the PTR Scheme in connection with the Facilities;
	 
	 	(ii)	 	shall co-operate with the Agent in completing any procedural
formalities necessary under the PTR Scheme, and shall promptly supply to the Agent
such information as the Agent
may request in connection with the operation of the PTR Scheme;
	 
	 	(iii)	 	without limiting the liability of any Borrower under this Agreement,
shall, within 5 Business Days of demand, indemnify the Agent for any liability of
loss incurred by the Agent as a result of the Agent acting as syndicate manager
under the PTR Scheme in connection with the Treaty Lender’s participation in any
Loan (except to the extent the liability or loss arises directly from the Agent’s
gross negligence or wilful misconduct); and
	 
	 	(iv)	 	shall, within 5 Business Days of demand, indemnify each Borrower for
any Tax which such Borrower becomes liable to pay in respect of any prepayments
made to such Treaty Lender arising as a result of any incorrect information
supplied by such Treaty Lender under paragraph (iii) above which results in a
provisional authority issued by the UK Inland Revenue under the PTR Scheme being
withdrawn.

	(b)	 	Each Borrower acknowledges that it is fully aware of its contingent obligations under
the PTR Scheme and shall:

	 	(i)	 	promptly supply to the Agent such information as the Agent may
request in connection with the operation of the PTR Scheme; and
	 
	 	(ii)	 	act in accordance with any provisional notice issued by the UK Inland
Revenue under the PTR Scheme.

	(c)	 	The Agent agrees to provide, as soon as reasonably practicable, a copy of any
provisional authority issued to it under the PTR Scheme in connection with any Loan to
those Borrowers specified in such provisional authority.
	 
	(d)	 	All Parties acknowledge that the Agent:

	 	(i)	 	is entitled to rely completely upon information provided to it in
connection with sub- paragraph (a) or (b) above;
	 
	 	(ii)	 	is not obliged to undertake any enquiry into the accuracy of such
information, nor into the status of the Treaty Lender or, as the case may be,
Borrower providing such information; and
	 
	 	(iii)	 	shall have no liability to any person for the accuracy of any
information it submits in connection with paragraph (a)(i) above.

	(e)	 	In this Clause “PTR Scheme” means the Provisional Treaty Relief scheme as described
in Inland Revenue Guidelines dated January 2003 and administered by the Inland Revenue’s
Centre for Non-Residents.

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	14.	 	INCREASED COSTS

	 
	14.1	 	Increased costs
	 
	(a)	 	Subject to Clause 14.3 (Exceptions) the Company shall, within five Business Days of a
demand by the Agent, pay for the account of a Finance Party the amount of any Increased
Costs incurred by that Finance Party or any of its Affiliates as a result of (i) the
introduction of or any change in (or in the interpretation, administration or application
of) any law or regulation or (ii) compliance with any law or regulation made after the
date of this Agreement.
	 
	(b)	 	In this Agreement “Increased Costs” means:

	 	(i)	 	a reduction in the rate of return from the Facility or on a Finance
Party’s (or its Affiliate’s) overall capital;
	 
	 	(ii)	 	an additional or increased cost; or
	 
	 	(iii)	 	a reduction of any amount due and payable under any Finance
Document,

	 	 	which is incurred or suffered by a Finance Party or any of its Affiliates to the extent
that it is attributable to that Finance Party having entered into its Commitment or funding
or performing its obligations under any Finance Document.

	14.2	 	Increased cost claims
	 
	(a)	 	A Finance Party intending to make a claim pursuant to Clause 14.1 (Increased costs)
shall notify the Agent of the event giving rise to the claim, following which the Agent
shall promptly notify the Company.
	 
	(b)	 	Each Finance Party shall, as soon as practicable after a demand by the Agent, provide
a certificate confirming the amount and reasonable details of the calculation of its
Increased Costs.
	 
	14.3	 	Exceptions
	 
	(a)	 	Clause 14.1 (Increased costs) does not apply to the extent any Increased Cost is:

	 	(i)	 	attributable to a Tax Deduction required by law to be made by an Obligor;
	 
	 	(ii)	 	compensated for by Clause 13.3 (Tax indemnity) (or would have been compensated for
under Clause 13.3 (Tax indemnity) but was not so compensated solely because any of the
exclusions in paragraph (b) of Clause 13.3 (Tax indemnity) applied);
	 
	 	(iii)	 	compensated for by the payment of the Mandatory Cost; or
	 
	 	(iv)	 	attributable to the negligence or wilful breach by the relevant Finance Party or its
Affiliates of any law or regulation.

	(b)	 	In this Clause 14.3, a reference to a “Tax Deduction” has the same meaning given to
the term in Clause 13.1 (Definitions).
	 
	15.	 	OTHER INDEMNITIES
	 
	15.1	 	Currency indemnity
	 
	(a)	 	If any sum due from an Obligor under the Finance Documents (a “Sum”), or any order,
judgment or award given or made in relation to a Sum, has to be converted from the currency
(the “First 

35

 

	 	 	Currency”) in which that Sum is payable into another currency (the “Second Currency”) for the
purpose of:

	 	(i)	 	making or filing a claim or proof against that Obligor;
	 
	 	(ii)	 	obtaining or enforcing an order, judgment or award in relation to any litigation or
arbitration proceedings,

	 	 	that Obligor shall as an independent obligation, within five Business Days of demand, indemnify
each Finance Party to whom that Sum is due against any cost, loss or liability arising out of or as
a result of the conversion including any discrepancy between (A) the rate of exchange used to
convert that Sum from the First Currency into the Second Currency and (B) the rate or rates of
exchange available to that person at the time of its receipt of that Sum.

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

	 	 	The Company shall (or shall procure that an Obligor will), within five Business Days of
demand, indemnify each Finance Party against any cost, loss or liability incurred by that
Finance Party as a result of:

	 	(a)	 	the occurrence of any Event of Default;

	 
	 	(b)	 	a failure by an Obligor to pay any amount due under a Finance Document on its due
date, including without limitation, any cost, loss or liability arising as a result
of Clause 28 (Sharing among the Finance Parties);
	 
	 	(c)	 	funding, or making arrangements to fund, its participation in a Loan requested
by a Borrower in a Utilisation Request but not made by reason of the operation of
any one or more of the provisions of this Agreement (other than by reason of
default or negligence by that Finance Party alone); or
	 
	 	(d)	 	a Loan (or part of a
Loan) not being prepaid in accordance with a notice of prepayment given by a
Borrower or the Company.

	15.3	 	Indemnity to the Agent

	 	 	The Company shall promptly indemnify the Agent against any cost, loss or liability incurred
by the Agent (acting reasonably) as a result of:

	 	(a)	 	investigating any event which it reasonably believes is an Event of Default; or
	 
	 	(b)	 	entering into or performing any foreign exchange contract for the purpose of paragraph (b) of Clause 6.3 (Change of currency); or
	 
	 	(c)	 	acting or relying on any notice, request or instruction made by an Obligor which it
reasonably believes to be genuine, correct and appropriately authorised.

36

 

	16.	 	MITIGATION BY THE LENDERS
	 
	16.1	 	Mitigation
	 
	(a)	 	Each Finance Party shall, in consultation with the Company, take all reasonable steps
to mitigate any circumstances which arise and which would result in any amount becoming
payable under or pursuant to, or cancelled pursuant to, any of Clause 8.1 (Illegality),
Clause 13 (Tax gross-up and indemnities), Clause 14 (Increased costs) or paragraph 3 of
Schedule 4 (Mandatory Cost formulae) including (but not limited to) transferring its
rights and obligations under the Finance Documents to another Affiliate or Facility
Office.
	 
	(b)	 	Paragraph (a) above does not in any way limit the obligations of any Obligor under
the Finance Documents.

	16.2	 	Limitation of liability
	 
	(a)	 	The Company shall indemnify each Finance Party for all costs and expenses reasonably
incurred by that Finance Party as a result of steps taken by it under Clause 16.1
(Mitigation).
	 
	(b)	 	A Finance Party is not obliged to take any steps under Clause 16.1 (Mitigation) if,
in the opinion of that Finance Party (acting reasonably), to do so might be prejudicial to
it.
	 
	17.	 	COSTS AND EXPENSES
	 
	17.1	 	Transaction expenses
	 
	 	 	The Company shall promptly on demand pay the Agent and the Arranger the amount of all
reasonable costs and expenses (including legal fees) reasonably incurred by any of them
(subject to a maximum in respect of legal fees as agreed with the Company) in connection
with the negotiation, preparation, printing, execution and syndication of:

	 	(a)	 	this Agreement and any other documents referred to in this Agreement;
and
	 
	 	(b)	 	any other Finance Documents executed after the date of this
Agreement.

	17.2	 	Amendment costs

	 	 	If (a) an Obligor requests an amendment, waiver or consent or (b) an amendment is required
pursuant to Clause 29.9 (Change of Currency), the Company shall, within five Business Days
of demand, reimburse the Agent for the amount of all reasonable costs and expenses
(including legal fees) reasonably incurred by the Agent in evaluating, negotiating or
complying with that request.

	17.3	 	Enforcement costs

	 	 	The Company shall, within five Business Days of demand, pay to each Finance Party the
amount of all costs and expenses (including legal fees) incurred by that Finance Party in
connection with the enforcement of, or the preservation of any rights under, any Finance
Document.

37

 

SECTION 7

GUARANTEE

	18.	 	GUARANTEE AND INDEMNITY
	 
	18.1	 	Guarantee and indemnity
	 
	 	 	Each Guarantor irrevocably and unconditionally jointly and severally:

	 	(a)	 	guarantees to each Finance Party punctual performance by each
Borrower of all that Borrower’s payment obligations under the Finance Documents;
	 
	 	(b)	 	undertakes with each Finance Party that whenever a Borrower does not
pay any amount when due under or in connection with any Finance Document, that
Guarantor shall immediately on demand pay that amount as if it was the principal
obligor; and
	 
	 	(c)	 	indemnifies each Finance Party immediately on demand against any
cost, loss or liability suffered by that Finance Party if any payment obligation
guaranteed by it is or becomes unenforceable, invalid or illegal. The amount of
the cost, loss or liability shall be equal to the amount which that Finance Party
would otherwise have been entitled to recover.

	18.2	 	Continuing guarantee

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

	18.3	 	Reinstatement
	 
	 	 	If any payment by an Obligor or any discharge given by a Finance Party (whether in respect
of the obligations of any Obligor or any security for those obligations or otherwise) is
avoided or reduced as a result of insolvency or any similar event:

	 	(a)	 	the liability of each Obligor shall continue as if the payment,
discharge, avoidance or reduction had not occurred; and
	 
	 	(b)	 	each Finance Party shall be entitled to recover the value or amount
of that security or payment from each Obligor, as if the payment, discharge,
avoidance or reduction had not occurred.

	18.4	 	Waiver of defences
	 
	 	 	The obligations of each Guarantor under this Clause 18 will not be affected by an act,
omission, matter or thing which, but for this Clause, would reduce, release or prejudice
any of its obligations under this Clause 18 (without limitation and whether or not known to
it or any Finance Party) including:

	 	(a)	 	any time, waiver or consent granted to, or composition with, any
Obligor or other person;
	 
	 	(b)	 	the release of any other Obligor or any other person under the terms
of any composition or arrangement with any creditor of any member of the Group;
	 
	 	(c)	 	the taking, variation, compromise, exchange, renewal or release of,
or refusal or neglect to perfect, take up or enforce, any rights against, or
security over assets of, any Obligor

38

 

	 	 	 	or other person or any non-presentation or non-observance of any formality or other
requirement in respect of any instrument or any failure to realise the full value
of any security;
	 	(d)	 	any incapacity or lack of power, authority or legal personality of or
dissolution or change in the members or status of an Obligor or any other person;
	 
	 	(e)	 	any amendment (however fundamental) or replacement of a Finance
Document or any other document or security;
	 
	 	(f)	 	any unenforceability, illegality or invalidity of any obligation of
any person under any Finance Document or any other document or security; or
	 
	 	(g)	 	any insolvency or similar proceedings.

	18.5	 	Immediate recourse

	 	 	Each Guarantor waives any right it may have of first requiring any Finance Party (or any
trustee or
agent on its behalf) to proceed against or enforce any other rights or security or claim
payment from any person before claiming from that Guarantor under this Clause 18. This
waiver applies irrespective of any law or any provision of a Finance Document to the
contrary.

	18.6	 	Appropriations

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

	 	(a)	 	refrain from applying or enforcing any other moneys, security or
rights held or received by that Finance Party (or any trustee or agent on its
behalf) in respect of those amounts, or apply and enforce the same in such manner
and order as it sees fit (whether against those amounts or otherwise) and no
Guarantor shall be entitled to the benefit of the same; and
	 
	 	(b)	 	hold in an interest-bearing suspense account any moneys received from
any Guarantor or on account of any Guarantor’s liability under this Clause 18.

	18.7	 	Deferral of Guarantors’ rights
	 
	 	 	Until all amounts which may be or become payable by the Obligors under or in connection
with the Finance Documents have been irrevocably paid in full and unless the Agent
otherwise directs, no Guarantor will exercise any rights which it may have by reason of
performance by it of its obligations under the Finance Documents:

	 	(a)	 	to be indemnified by an Obligor;
	 
	 	(b)	 	to claim any contribution from any other guarantor of any Obligor’s
obligations under the Finance Documents; and/or
	 
	 	(c)	 	to take the benefit (in whole or in part and whether by way of
subrogation or otherwise) of any rights of the Finance Parties under the Finance
Documents or of any other guarantee or security taken pursuant to, or in
connection with, the Finance Documents by any Finance Party.

39

 

	18.8	 	Release of Guarantors’ right of contribution
	 
	 	 	If any Guarantor (a “Retiring Guarantor”) ceases to be a Guarantor in accordance with the
terms of the Finance Documents for the purpose of any sale or other disposal of that
Retiring Guarantor then on the date such Retiring Guarantor ceases to be a Guarantor:

	 	(a)	 	that Retiring Guarantor is released by each other Guarantor from any
liability (whether past, present or future and whether actual or contingent) to
make a contribution to any other Guarantor arising by reason of the performance by
any other Guarantor of its obligations under the Finance Documents; and
	 
	 	(b)	 	each other Guarantor waives any rights it may have by reason of the
performance of its obligations under the Finance Documents to take the benefit (in
whole or in part and whether by way of subrogation or otherwise) of any rights of
the Finance Parties under any Finance Document or of any other security taken
pursuant to, or in connection with, any Finance Document where such rights or
security are granted by or in relation to the assets of the Retiring Guarantor.

	18.9	 	Additional security

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

40

 

SECTION 8

REPRESENTATIONS, UNDERTAKINGS AND EVENTS OF DEFAULT

	19.	 	REPRESENTATIONS

	 	 	Each Obligor makes the representations and warranties set out in this Clause 19 (except for
the representations and warranties in Clause 19.11 (No misleading information) which are
deemed to be made by the Company on the Syndication Date) to each Finance Party, on the
date of this Agreement.

	19.1	 	Status
	 
	(a)	 	It is a corporation, duly incorporated and validly existing under the law of its
jurisdiction of incorporation.
	 
	(b)	 	It and each of its Material Subsidiaries has the power to own its assets and carry on
its business as it is being conducted.
	 
	19.2	 	Binding obligations

	 	 	The obligations expressed to be assumed by it in each Finance Document are subject to any
general principles of law limiting its obligations which are specifically referred to in
any legal opinion delivered pursuant to Clause 4 (Conditions of Utilisation) or Clause 25
(Changes to the Obligors) legal, valid, binding and enforceable obligations.

	19.3	 	Non-conflict with other obligations
	 
	 	 	The entry into and performance by it of, and the transactions contemplated by, the Finance
Documents do not and will not conflict with:

	 	(a)	 	any law or regulation applicable to it;

	 
	 	(b)	 	its constitutional documents; or
	 
	 	(c)	 	any agreement or instrument binding upon it or any of its
Subsidiaries or any of its or any of its Subsidiaries’ assets breach of which
would have a Material Adverse Effect.

	19.4	 	Power and authority

	 	 	It has the power to enter into, perform and deliver, and has taken all necessary action to
authorise its entry into, performance and delivery of, the Finance Documents to which it is
a party and the transactions contemplated by those Finance Documents.

	19.5	 	Validity and admissibility in evidence
	 
	 	 	All Authorisations required:

	 	(a)	 	to enable it lawfully to enter into, exercise its rights and comply
with its obligations in the Finance Documents to which it is a party; and
	 
	 	(b)	 	to make the Finance Documents to which it is a party admissible in
evidence in its jurisdiction of incorporation,
	 
	 	 	 	have been obtained or effected and are in full force and effect (or, in each case, will be
when required).

41

 

	19.6	 	No default
	 
	(a)	 	No Event of Default is continuing or could reasonably be expected to result from the
making of any Utilisation.
	 
	(b)	 	No other event or circumstance is outstanding which constitutes a default under any
other agreement or instrument which is binding on it or any of its Subsidiaries or to
which its (or any of its Subsidiaries’) assets are subject which has or could reasonably
be expected to have a Material Adverse Effect.
	 
	19.7	 	Financial statements
	 
	(a)	 	The Original Financial Statements were prepared in accordance with GAAP consistently
applied.
	 
	(b)	 	The Original Financial Statements give a true and fair view of the consolidated
financial condition and operations of the Group during the relevant financial period.
	 
	(c)	 	There has been no material adverse change in the business or financial condition of
the Group since 31 December 2003.
	 
	19.8	 	Pari passu ranking

	 	 	Its payment obligations under the Finance Documents rank at least pari passu with the
claims of all its other unsecured and unsubordinated creditors, except for obligations
mandatorily preferred by law applying to companies generally.

	19.9	 	No proceedings pending or threatened

	 	 	No litigation, arbitration or administrative proceedings of or before any court, arbitral
body or agency which are reasonably likely to be adversely determined and, if adversely
determined, could be reasonably likely to have a Material Adverse Effect have (to the best
of its knowledge and belief) been started or threatened against it or any of its
Subsidiaries.

	19.10	 	Repetition
	 
	 	 	The Repeating Representations are deemed to be made by each Obligor by reference to the
facts and circumstances then existing on:

	 	(a)	 	the date of each Utilisation Request and the first day of each
Interest Period; and
	 
	 	(b)	 	in the case of an Additional Obligor, the day on which the company
becomes (or it is proposed that the company becomes) an Additional Obligor.

	19.11	 	No misleading information
	 
	(a)	 	Any written factual information provided by or on behalf of any member of the Group
for the purposes of the Information Memorandum, was true and accurate in all material
respects as at the date it was provided or as at the date (if any) at which it is stated.
	 
	(b)	 	The financial projections contained in the Information Memorandum have been prepared
on the basis of recent historical information and on the basis of assumptions believed by
it at the time to be reasonable.
	 
	(c)	 	Nothing has occurred or been omitted from the Information Memorandum and no
information has been given or withheld that results in the information referred to in
paragraph (a) contained in the Information Memorandum being untrue or misleading in any
material respect.

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	20.	 	INFORMATION UNDERTAKINGS

	 	 	The undertakings in this Clause 20 remain in force from the date of this Agreement for so
long as any amount is outstanding under the Finance Documents or any Commitment is in
force.

	20.1	 	Financial statements
	 
	 	 	The Company shall supply to the Agent in sufficient copies for all the Lenders:

	 	(a)	 	as soon as the same become available, but in any event within 120
days after the end of each of its financial years:

	 	(i)	 	its audited consolidated financial statements for
that financial year; and
	 
	 	(ii)	 	the financial statements of each Obligor for that
financial year (which shall be audited if that Obligor produces audited
financial statements); and

	 	(b)	 	as soon as the same become available, but in any event within 90 days
after the end of the first half of each of its financial years, its consolidated
financial statements for that financial half year.

	20.2	 	Compliance Certificate
	 
	(a)	 	The Company shall supply to the Agent, with each set of financial statements
delivered pursuant to paragraph (a)(i) or (b) of Clause 20.1 (Financial statements), a
Compliance Certificate setting out:

	 	(i)	 	(in reasonable detail) computations as to compliance with Clause 21
(Financial covenants); and
	 
	 	(ii)	 	an updated list of Material Subsidiaries,

	 	 	in each case, as at the date at which those financial statements were drawn up.

	(b)	 	Each Compliance Certificate shall be signed by a director or an authorised signatory
on behalf of the Company.
	 
	20.3	 	Margin Certificate
	 
	(a)	 	The Company shall supply to the Agent a Margin Certificate within 80 days of each Quarter Date
setting out a computation of the Margin Ratio.
	 
	(b)	 	Each Margin Certificate shall be signed by a director on behalf of the Company.
	 
	20.4	 	Requirements as to financial statements
	 
	(a)	 	Each set of financial statements delivered by the Company pursuant to Clause 20.1(a)
(Financial statements) shall be certified by an authorised signatory on behalf of the
relevant company as fairly representing its (or, as the case may be, its consolidated)
financial condition and operations as at the end of and for the period in relation to
which those financial statements were drawn up.
	 
	(b)	 	The Company shall procure that each set of financial statements of the Group
delivered pursuant to Clause 20.1 (Financial statements) is prepared using GAAP for any
financial year ending on or prior to 31 December 2004 and IFRS for any financial year
ending thereafter and it shall deliver to the Agent:

	 	(i)	 	sufficient information, in form and substance as may be reasonably
required by the Agent, to enable the Lenders to determine whether Clause 21
(Financial covenants) has

43

 

	 	 	 	been complied with and make an accurate comparison between the financial
position indicated in those financial statements and the Original
Financial Statements; and

	 	(ii)	 	a description of any change necessary for those
financial statements to reflect the Applicable Accounting Principles upon
which the Original Financial Statements were prepared.

	(c)	 	Any reference in this Agreement to the financial statements of the Group delivered
pursuant to Clause 20.1 (Financial statements) shall be construed as a reference to those
financial statements as adjusted to reflect the Applicable Accounting Principles.
	 
	20.5	 	Information: miscellaneous
	 
	 	 	The Company shall supply to the Agent (in sufficient copies for all the Lenders, if
the Agent so requests):

	 	(a)	 	all documents dispatched by the Company to its
shareholders (or any class of them) or its creditors generally at the same
time as they are dispatched;
	 
	 	(b)	 	promptly upon becoming aware of them, the details of
any litigation, arbitration or administrative proceedings which are
current, threatened or pending against any member of the Group, and which
might, if adversely determined, have a Material Adverse Effect; and
	 
	 	(c)	 	promptly, such further information regarding the
financial condition, business and operations of any member of the Group as
any Finance Party (through the Agent) may reasonably request except to the
extent that disclosure of the information would breach any law regulation,
stock exchange requirement or duty of confidentiality.

	20.6	 	Notification of default
	 
	(a)	 	Each Obligor shall notify the Agent of any Default and the steps, if any, being taken
to remedy it promptly upon becoming aware of its occurrence (unless that Obligor is aware
that a notification has already been provided by another Obligor).
	 
	(b)	 	Promptly upon a request by the Agent, the Company shall supply to the Agent a
certificate signed by a director or authorised signatory on its behalf certifying that no
Default is continuing (or if continuing, specifying the steps, if any, being taken to remedy it).
	 
	20.7	 	Use of websites
	 
	(a)	 	The Company may satisfy its obligation under this Agreement to deliver any
information in relation to those Lenders (the “Website Lenders”) who accept this method of
communication by posting this information onto an electronic website designated by the
Company and the Agent (the “Designated Website”) if:

	 	(i)	 	the Agent expressly agrees (after consultation with each of the
Lenders) that it will accept communication of the information by this method;
	 
	 	(ii)	 	the Company and the Agent are aware of the address of and any
relevant password specifications for the Designated Website; and
	 
	 	(iii)	 	the information is in a format previously agreed between the Company
and the Agent.

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	 	 	If any Lender (a “Paper Form Lender”) does not agree to the delivery of information
electronically then the Agent shall notify the Company accordingly and the Company shall
supply the information to the Agent (in sufficient copies for each Paper Form Lender) in
paper form. In any event the Company shall supply the Agent with at least one copy in paper
form of any information required to be provided by it.
	 
	(b)	 	The Agent shall supply each Website Lender with the address of and any relevant
password specifications for the Designated Website following designation of that website
by the Company and the Agent.
	 
	(c)	 	The Company shall promptly upon becoming aware of its occurrence notify the Agent if:

	 	(i)	 	the Designated Website cannot be accessed due to technical failure;

	 
	 	(ii)	 	the password specifications for the Designated Website change;
	 
	 	(iii)	 	any new information which is required to be provided under this
Agreement is posted onto the Designated Website;
	 
	 	(iv)	 	any existing information which has been provided under this Agreement
and posted onto the Designated Website is amended; or
	 
	 	(v)	 	the Company becomes aware that the Designated Website or any
information posted onto the Designated Website is or has been infected by any
electronic virus or similar software.

	 	 	If the Company notifies the Agent under paragraph (c)(i) or paragraph (c)(v) above, all
information to be provided by the Company under this Agreement after the date of that
notice shall be supplied in paper form unless and until the Agent and each Website Lender
is satisfied that the circumstances giving rise to the notification are no longer
continuing.

	(d)	 	Any Website Lender may request, through the Agent, one paper copy of any information
required to be provided under this Agreement which is posted onto the Designated Website.
The Company shall comply with any such request within ten Business Days.
	 
	20.8	 	“Know your customer” checks
	 
	(a)	 	If:

	 	(i)	 	the introduction of or any change in (or in the interpretation,
administration or application of) any law or regulation made after the date of
this Agreement;
	 
	 	(ii)	 	any change in the status of an Obligor after the date of this
Agreement; or
	 
	 	(iii)	 	a proposed assignment or transfer by a Lender of any of its rights
and obligations under this Agreement to a party that is not a Lender prior to such
assignment or transfer,

	 	 	obliges the Agent or any Lender (or, in the case of paragraph (iii) above, any prospective
new Lender) to comply with “know your customer” or similar identification procedures in
circumstances where the necessary information is not already available to it, each Obligor
shall promptly upon the request of the Agent or any Lender supply, or procure the supply
of, such documentation and other evidence as is reasonably requested by the Agent (for
itself or on behalf of any Lender) or any Lender (for itself or, in the case of the event described in
paragraph (iii) above, on behalf of any prospective new Lender) in order for the Agent, such Lender or, in

45

 

	 	 	the case of the event described in paragraph (iii) above, any prospective new Lender to
carry out and be satisfied it has complied with all necessary “know your customer” or other
similar checks under all applicable laws and regulations pursuant to the transactions
contemplated in the Finance Documents.

	(b)	 	Each Lender shall promptly upon the request of the Agent supply, or procure the
supply of, such documentation and other evidence as is reasonably requested by the Agent
(for itself) in order for the Agent to carry out and be satisfied it has complied with all
necessary “know your customer” or other similar checks under all applicable laws and
regulations pursuant to the transactions contemplated in the Finance Documents.
	 
	(c)	 	The Company shall, by not less than 5 Business Days’ prior written notice to the
Agent, notify the Agent (which shall promptly notify the Lenders) of its intention to
request that one of its Subsidiaries becomes an Additional Obligor pursuant to Clause 25
(Changes to the Obligors).
	 
	(d)	 	Following the giving of any notice pursuant to paragraph (c) above, if the accession
of such Additional Obligor obliges the Agent or any Lender to comply with “know your
customer” or similar identification procedures in circumstances where the necessary
information is not already available to it, the Company shall promptly upon the request of
the Agent or any Lender supply, or procure the supply of, such documentation and other
evidence as is reasonably requested by the Agent (for itself or on behalf of any Lender)
or any Lender (for itself or on behalf of any prospective new Lender) in order for the
Agent or such Lender or any prospective new Lender to carry out and be satisfied it has
complied with all necessary “know your customer” or other similar checks under all
applicable laws and regulations pursuant to the accession of such Subsidiary to this
Agreement as an Additional Obligor.

	21.	 	FINANCIAL COVENANTS
	 
	21.1	 	Financial Condition
	 
	 	 	The Company shall ensure that:

	 	(a)	 	the ratio of EBITDA to Net Interest Payable for the Relevant Period
ending on 31 December 2004 and for each Relevant Period thereafter will not be
less than 3.5:1; and
	 
	 	(b)	 	the ratio of Net Borrowings, as at the last day of each Relevant
Period to EBITDA for that Relevant Period will not be more than 3.25:1, where:

	 	(i)	 	the first test period for this covenant shall be the
Relevant Period ending 31 December 2004; and
	 
	 	(ii)	 	EBITDA for the purpose of this covenant shall be
adjusted to take into account the pro forma impact of any acquisitions or
disposals (other than of Managed Assets) made during the Relevant Period
by a member of the Group.

	21.2	 	Financial covenant calculations
	 
	(a)	 	For the purposes of this Agreement, Borrowings (including Financial Indebtedness for
the purpose of calculating Borrowings), EBITDA, Net Borrowings and Net Interest Payable
shall be:

	 	(i)	 	calculated and interpreted on a consolidated basis in accordance with
the Applicable Accounting Principles of the Company and shall be expressed in
sterling; and

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	 	(ii)	 	extracted (except as needed to reflect the terms of this Clause 21)
from the financial statements of the Group delivered under Clause 20.1 (Financial
statements) and Clause 20.2 (Compliance Certificate),

	 	 	and “Group” shall, for the purpose of this Clause 21, include Britvic.

	(b)	 	During any Relevant Period in which the New Parent Scheme Date occurs, for any
calculation of Borrowings (including Financial Indebtedness for the purpose of calculating
Borrowings), EBITDA, Net Borrowings and Net Interest Payable, “Group” shall mean:

	 	(i)	 	IHG and its Subsidiaries during that period at any time up to the New
Parent Scheme Date; and
	 
	 	(ii)	 	the New Parent and its Subsidiaries during that period at any time
from and including the New Parent Scheme Date.

	21.3	 	Definitions
	 
	 	 	In this Agreement:
	 
	 	 	“Borrowings” means, as at any particular time, the aggregate outstanding principal, capital
or nominal amount (and any fixed or minimum premium payable on redemption) of the Financial
Indebtedness of members of the Group, other than:

	 	(a)	 	any indebtedness referred to in paragraph (g) of the definition of
Financial Indebtedness;
	 
	 	(b)	 	any Project Finance Indebtedness; and
	 
	 	(c)	 	any indebtedness referred to in paragraphs (f)(ii), (i) and (j) of
the definition of Financial Indebtedness except, in the case of paragraphs (i) and
(j), to the extent any such obligation or liability specified in such paragraphs
has been provided for in the financial statements of the Group delivered under
Clause 20.1 (Financial statements) or is disclosed as a contingency in the notes
thereto and is quantified,

	 	 	and deducting, to the extent included, amounts attributable to interests of third parties
in members of the Group.
	 
	 	 	For this purpose, any amount outstanding or repayable in a currency other than sterling
shall on that day be taken into account in its sterling equivalent at the rate of exchange
that would have been used had an audited consolidated balance sheet of the Group been
prepared as at that day in accordance with the GAAP applicable to the Original Financial
Statements.
	 
	 	 	“Cash” means any credit balances on any deposit, savings, current or other account, and any
cash in hand, which is:

	 	(a)	 	freely withdrawable on demand;
	 
	 	(b)	 	not subject to any Security (other than permitted pursuant to Clause
22.3 (Negative pledge));
	 
	 	(c)	 	denominated and payable in freely transferable and freely convertible
currency; and
	 
	 	(d)	 	capable of being remitted to an Obligor in the United Kingdom.

	 	 	“Cash Equivalent Investments” means:

47

 

	 	(a)	 	securities issued or fully guaranteed or insured by the Government of the United
States or any member state of the European Union which is rated at least AA by S&P and/or
Fitch or Aa by Moody’s;
	 
	 	(b)	 	commercial paper or other debt securities issued by an issuer rated at least A-1 by
S&P and/or Fitch or P-1 by Moody’s; and
	 
	 	(c)	 	certificates of deposit or time deposits of any commercial bank (which has
outstanding debt securities rated at least A- by S&P or A3 by Moody’s),

	 	 	in each case not subject to any Security (other than permitted pursuant to Clause 22.3 (Negative
pledge)) denominated and payable in freely transferable and freely convertible currency and the
proceeds of which are capable of being remitted to an Obligor in the United Kingdom.
	 
	 	 	“EBITDA” means, in relation to any Relevant Period, the total consolidated operating profit of the
Group for that Relevant Period:

	 	(a)	 	before taking into account:

	 	(i)	 	Net Interest Payable;
	 
	 	(ii)	 	Tax; and
	 
	 	(iii)	 	all extraordinary and exceptional items; and

	 	(b)	 	after adding back all amounts provided for depreciation and amortisation; and
	 
	 	(c)	 	deducting, to the extent included, amounts attributable to interests of third parties
in members of the Group.

	 	 	“Net Borrowings” means, as at any particular time, Borrowings less Cash and Cash Equivalent
Investments.
	 
	 	 	“Net Interest Payable” means, in relation to any Relevant Period, the aggregate amount of interest
and any other finance charges accrued by the Group in that Relevant Period in respect of Borrowings
including:

	 	(a)	 	the interest element of leasing and hire purchase payments;

	 
	 	(b)	 	commitment fees, commissions and guarantee fees; and
	 
	 	(c)	 	amounts in the nature of interest payable in respect of any shares other than equity
share capital,

	 	 	adjusted (but without double counting) by:

	 	(i)	 	deducting interest income of the Group in respect of that Relevant Period;
	 
	 	(ii)	 	adding back the net amount payable (or deducting the net amount receivable) by
members of the Group in that Relevant Period as a result of close-out or termination of
any interest or (so far as they relate to interest) currency hedging activities;
	 
	 	(iii)	 	adding back the amount payable as a premium on any bond buy-back by members of the
Group in that Relevant Period;
	 
	 	(iv)	 	deducting, to the extent included, the amount payable by members of the Group in that
Relevant Period for arrangement or related fees in respect of Borrowings including, for

48

 

	 	 	 	the avoidance of doubt, any un-amortised fees to be written-off in respect of the
Existing Facility (to include, for the avoidance of doubt, underwriting,
syndication and fees of a similar nature)); and

	 	(v)	 	deducting, to the extent included, the amount of interest and other
finance charges attributable to interests of third parties in members of the Group
and adjusting, as appropriate, the additions or deductions specified in paragraphs
(i) to (iv) (inclusive) above as a consequence of interests of third parties in
members of the Group.

	 	 	“Relevant Period” means:

	 	(a)	 	each financial year of the Company; and
	 
	 	(b)	 	each period beginning on the first day of the second half of a
financial year of the Company and ending on the last day of the first half of its
next financial year.

	22.	 	GENERAL UNDERTAKINGS

	 	 	The undertakings in this Clause 22 remain in force from the date of this Agreement for so
long as any amount is outstanding under the Finance Documents or any Commitment is in
force.

	22.1	 	Authorisations
	 
	 	 	Each Obligor shall promptly:

	 	(a)	 	obtain, comply with and do all that is necessary to maintain in full
force and effect; and
	 
	 	(b)	 	supply certified copies to the Agent of,

	 	 	any Authorisation required under any law or regulation of its jurisdiction of incorporation
to enable it to perform its obligations under the Finance Documents and to ensure the
legality, validity, enforceability or admissibility in evidence in its jurisdiction of
incorporation of any Finance Document.

	22.2	 	Compliance with laws

	 	 	Each Obligor shall comply with all laws to which it may be subject, if failure so to comply
would materially impair its ability to perform its obligations under the Finance Documents.

	22.3	 	Negative pledge
	 
	(a)	 	No Obligor shall (and the Company shall ensure that no other member of the Group
will) create or permit to subsist any Security over any of its assets.
	 
	(b)	 	Paragraph (a) above does not apply to:

	 	(i)	 	any Security listed in Schedule 9 (Security) except to the extent the
principal amount secured by that Security exceeds the amount stated in that
Schedule;
	 
	 	(ii)	 	any cash management, netting or set-off arrangement entered into by
any member of the Group in the ordinary course of its banking arrangements for the
purpose of netting debit and credit balances;
	 
	 	(iii)	 	any lien arising by operation of law and in the ordinary course of
business;
	 
	 	(iv)	 	any Security over or affecting any asset acquired by a member of the
Group after the date of this Agreement to the extent that:

49

 

	 	(A)	 	the Security was not created in contemplation of the acquisition of
that asset by a member of the Group; and
	 
	 	(B)	 	the principal amount secured has not been increased in contemplation
of or since the acquisition of that asset by a member of the Group;

	 	(v)	 	any Security over or affecting any asset of any company which becomes a member of the
Group after the date of this Agreement, where the Security is created prior to the date on
which that company becomes a member of the Group, to the extent that:

	 	(A)	 	the Security was not created in contemplation of the acquisition of
that company; and
	 
	 	(B)	 	the principal amount secured has not increased in contemplation of or
since the acquisition of that company;

	 	(vi)	 	any Security created pursuant to any Finance Document;
	 
	 	(vii)	 	any title transfer or retention of title arrangement entered into by any member of
the Group in the ordinary course of business;
	 
	 	(viii)	 	pledges of goods, the related documents of title and/or other related documents arising
or created in the ordinary course of business as security for indebtedness to a bank or
financial institution directly relating to the goods or documents over which that pledge
exists;
	 
	 	(ix)	 	any Security over cash or other investments for bank guarantees given in the ordinary
course of trading securing liabilities of up to £50,000,000 or to meet any margin
requirement in respect of derivative transactions;
	 
	 	(x)	 	any Security resulting from the rules and regulations of any clearing system or stock
exchange over shares and/or other securities held in that clearing system or stock
exchange;
	 
	 	(xi)	 	any Security securing Project Finance Indebtedness;
	 
	 	(xii)	 	any Security provided in relation to the InterContinental executive top-up scheme
securing liabilities of up to £20,000,000;
	 
	 	(xiii)	 	any Security replacing any Security permitted under paragraph (i) above or this
paragraph (xiii) and securing the same indebtedness or obligations whose principal amount
does not exceed the maximum principal amount secured, or which could be secured, by the
replaced Security when it is replaced;
	 
	 	(xiv)	 	any Security provided in connection with the Boston Lease;
	 
	 	(xv)	 	any Security securing indebtedness the principal amount of which (when aggregated
with the principal amount of any other indebtedness which has the benefit of Security
given by any member of the Group other than any permitted under paragraphs (i) to (xiv)
above) does not exceed 5 per cent. of the Consolidated Gross Assets of the Group (or its
equivalent in another
currency or currencies as calculated using the most recently delivered financial statements
of the Group; or
	 
	 	(xvi)	 	any other Security created or outstanding with the prior consent of the Majority
Lenders.

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	22.4	 	Subsidiary Indebtedness
	 
	(a)	 	The Company shall ensure that the portion of Financial Indebtedness which is borrowed
or incurred by Subsidiaries that are not Guarantors under this Agreement shall not at any
time exceed the aggregate of:

	 	(i)	 	£200,000,000; and
	 
	 	(ii)	 	£200,000,000 (provided such amount relates exclusively to Financial
Indebtedness specified in paragraphs (f)(ii), (i) and (j) of the definition of
Financial Indebtedness),

	 	 	and provided that Financial Indebtedness for the purpose of this Clause 22.4 shall exclude:

	 	(A)	 	amounts borrowed under this Agreement;
	 
	 	(B)	 	qualifying amounts specified in paragraph (b) below which are secured as permitted
pursuant to paragraphs (iv) or (v) of Clause 22.3 (Negative pledge) or otherwise is
outstanding for the period of up to 6 months following the relevant acquisition; and
	 
	 	(C)	 	amounts which would be included as Financial Indebtedness under paragraph (d) of the
definition of Financial Indebtedness due to a change in GAAP after the date of this Agreement
but would not be treated as Financial Indebtedness using Applicable Accounting Principles.

	(b)	 	Where a member of the Group acquires an asset or a company after the date of this
Agreement in respect of which Financial Indebtedness is outstanding (other than Project
Finance Indebtedness), where:

	 	(i)	 	that Financial Indebtedness was not created in contemplation of the
acquisition of that asset or company; and
	 
	 	(ii)	 	that Financial Indebtedness has not increased in contemplation of or
since that acquisition,

	 	 	then that Financial Indebtedness shall be taken into account for the purposes of the
exclusion specified in paragraph (a) above.

	22.5	 	Change of business
	 
	 	 	Save as disclosed in the Information Memorandum, the Company shall procure that no
substantial change is made to the general nature of the business of the Group taken as a
whole from that anticipated to be carried on at the date of this Agreement but this shall
not prevent any member of the Group engaging in any ancillary or related business.
	 
	22.6	 	Insurance
	 
	 	 	Each Obligor shall (and the Company shall ensure that each other member of the Group will)
maintain insurances on and in relation to its business and assets with reputable
underwriters or insurance companies against those risks, and to the extent, usually insured
against by prudent companies located in the same or a similar location and carrying on a
similar business.
	 
	22.7	 	Acquisitions
	 
	 	 	No Obligor shall (and the Company shall ensure that no other member of the Group will)
complete (without the approval of the Majority Lenders which shall not be unreasonably
withheld

51

 

	 	 	or delayed) any acquisition (whether through a single transaction or series of related
transactions with the same party or with parties connected with one another) where the
consideration for the acquisition exceeds 25 per cent. of the Group’s market capitalisation
at the time of the London
Stock Exchange market close on the day falling immediately prior to the date of formal
announcement of such acquisition by the Company.

	22.8	 	Britvic
	 
	 	 	The Company and its Subsidiaries shall at all times act on arms-length terms with Britvic.

	22.9	 	Return of Funds
	 
	(a)	 	The Company shall not reduce, purchase, repay, cancel or redeem any of its shares or
pay any special dividend, in each case, for the purpose of distribution to shareholders,
in an amount exceeding £200,000,000 (each a “Return of Funds”) at any time (other than by
way of open market purchases) unless, at the time the Company is legally committed to
proceed with that Return of Funds (the “Record Date”), the ratio of Net Borrowings, as at
the most recently ended Quarter Date prior to that Record Date (the “Test Date”) to EBITDA
for the 12 months period ending on that Quarter Date (the “Test Period”) is less than
3.25:1.
	 
	(b)	 	For the purposes of this Clause 22.9, the definitions set out in Clause 21.2
(Financial covenant calculations) shall apply save that:

	 	(i)	 	EBITDA shall be adjusted to take into account the pro forma impact of
any disposals (other than of a Managed Asset) made by a member of the Group; and
	 
	 	(ii)	 	Net Borrowings shall be adjusted to take into account the pro forma
impact of (but without double counting):

	 	(A)	 	any actual or proposed Return of Funds; and
	 
	 	(B)	 	the proceeds (net of tax and other charges) received
from any disposals made by a member of the Group,

	 	 	in each case made, or to be made, during the period since the Test Date up to and including
the Record Date; and

	 	(iii)	 	the reference to “Relevant Period” in the definition of EBITDA shall be substituted with “Test Period”.

	22.10	 	Disposal of Receivables
	 
	(a)	 	No Obligor shall (and the Company shall ensure that no other member of the Group
will) sell, transfer or otherwise dispose of any of its trade receivables.
	 
	(b)	 	Paragraph (a) above does not apply to any sale, transfer or other disposal of any of
its receivables where the aggregate face value of all such receivables that are
outstanding at any time does not exceed £35,000,000 (or its equivalent in another currency
or currencies).
	 
	23.	 	EVENTS OF DEFAULT
	 
	 	 	Each of the events or circumstances set out in Clause 23 is an Event of Default.

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	23.1	 	Non-payment
	 
	 	 	An Obligor does not pay on the due date any amount payable pursuant to a Finance Document
at the place at and in the currency in which it is expressed to be payable unless:

	 	(a)	 	its failure to pay is caused by administrative or technical error;
and
	 
	 	(b)	 	payment is made within 5 Business Days of its due date.

	23.2	 	Financial covenants
	 
	 	 	Any requirement of Clause 21 (Financial covenants) is not satisfied.

	23.3	 	Other obligations
	 
	(a)	 	An Obligor does not comply with any provision of the Finance Documents (other than
those referred to in Clause 23.1 (Non-payment) and Clause 23.2 (Financial covenants)).
	 
	(b)	 	No Event of Default under paragraph (a) above will occur if the failure to comply is
capable of remedy and is remedied within 20 days of the earlier of Agent giving notice to
the Company or the Company becoming aware of the failure to comply.
	 
	23.4	 	Misrepresentation
	 
	(a)	 	Any representation or statement made or deemed to be made by an Obligor in the
Finance Documents or any other document delivered by or on behalf of any Obligor under or
in connection with any Finance Document is or proves to have been incorrect or misleading
in any material respect when made or deemed to be made.
	 
	(b)	 	No Event of Default under paragraph (a) above will occur if the circumstances giving
rise to a misrepresentation or misstatement is/are capable of remedy and is/are remedied
within 20 days of the Agent giving notice to the Company requiring such remedy or (if
earlier) the Company becoming aware of the failure to comply.
	 
	23.5	 	Cross default
	 
	(a)	 	Any Financial Indebtedness of any member of the Group is not paid when due nor within
any applicable grace period.
	 
	(b)	 	Any Financial Indebtedness of any member of the Group is declared to be or otherwise
becomes due and payable prior to its specified maturity as a result of an event of default
(however described).
	 
	(c)	 	Any creditor of any member of the Group becomes entitled to declare any Financial
Indebtedness of any member of the Group due and payable prior to its specified maturity as
a result of an event of default (however described).
	 
	(d)	 	No Event of Default will occur under this Clause 23.5 if the aggregate amount of
Financial Indebtedness or commitment for Financial Indebtedness falling within paragraphs
(a) and (b) above is less than £25,000,000 (or its equivalent in any other currency or
currencies) and Financial Indebtedness for the purposes of this Clause 23.5 shall exclude,
in each case, Project Finance Indebtedness.
	 
	23.6	 	Insolvency
	 
	(a)	 	An Obligor or a Material Subsidiary is unable or admits inability to pay its debts as
they fall due, suspends making payments on any of its debts or, by reason of actual or
anticipated financial

53

 

	 	 	difficulties, commences negotiations with one or more of its creditors with a view to
rescheduling any of its indebtedness.

	(b)	 	A moratorium is declared or takes effect in respect of all or a material part (or a
particular type of) the indebtedness of an Obligor or a Material Subsidiary.

	23.7	 	Insolvency proceedings
	 
	(a)	 	Any corporate action or legal proceeding is taken (subject to paragraph (d) below)
for the winding-up or dissolution of an Obligor or Material Subsidiary, or the appointment
of a liquidator, administrator, administrative receiver, compulsory manager or other
similar officer is appointed in respect of, an Obligor or Material Subsidiary other than
for a solvent winding-up, dissolution or liquidation of an Obligor (other than the Company
or the Guarantors) or a Material Subsidiary.
	 
	(b)	 	Any corporate action or legal proceeding is taken (subject to paragraph (d) below),
or an agreement is entered into or proposed by an Obligor or Material Subsidiary, for the
suspension of payments by, a moratorium of any indebtedness of, or a general composition,
compromise or assignment for the benefit of the creditors of, an Obligor or Material
Subsidiary.
	 
	(c)	 	A receiver, administrative receiver, compulsory manager or other similar officer is
appointed in respect of an Obligor or Material Subsidiary or any of its assets, or any
Security is enforced over an Obligor’s or Material Subsidiary’s assets, having an
aggregate value of and in respect of indebtedness aggregating not less than £25,000,000
(or its equivalent in any other currency or currencies).
	 
	(d)	 	A person presents a petition for the winding up, liquidation, dissolution,
administration or
suspension of payments of an Obligor or Material Subsidiary except:

	 	(i)	 	where such petition is being contested in good faith and by
appropriate means and is in any event dismissed within 30 days of its
presentation; or
	 
	 	(ii)	 	where such presentation is frivolous or vexatious or an abuse of
process and is in any event dismissed within 30 days of its presentation.

	23.8	 	Creditors’ process
	 
	 	 	Any expropriation, attachment, sequestration, distress or execution affects any asset or
assets of an Obligor or Material Subsidiary having an aggregate value of and in respect of
indebtedness aggregating at least £25,000,000 and is not discharged within 30 days.

	23.9	 	Ownership of the Obligors
	 
	(a)	 	At any time before the New Parent Scheme Date, an Obligor (other than IHG) is not or
ceases to be a Subsidiary of IHG.
	 
	(b)	 	At any time from and including the New Parent Scheme Date, an Obligor (other than the
New Parent) is not or ceases to be a Subsidiary of the New Parent.
	 
	23.10	 	Unlawfulness
	 
	 	 	It is or becomes unlawful for an Obligor to perform any of its material obligations under
the Finance Documents.

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	23.11	 	Repudiation
	 
	 	 	An Obligor repudiates a Finance Document or evidences an intention to repudiate a Finance
Document.
	 
	23.12	 	Cessation of business
	 
	 	 	Save for the New Parent Scheme, an Obligor ceases to carry on its business except pursuant
to a reconstruction, amalgamation, merger or consolidation on solvent terms or, for the avoidance of doubt, by way of a disposal.
	 
	23.13	 	Acceleration
	 
	 	 	On and at any time after the occurrence of an Event of Default which is continuing the
Agent may, and shall if so directed by the Majority Lenders, by notice to the Company:

	 	(a)	 	cancel the Total Commitments whereupon they shall immediately be cancelled;
	 
	 	(b)	 	declare that all or part of the Loans, together with accrued interest, and all other amounts
accrued or outstanding under the Finance Documents be immediately due and payable,
whereupon they shall become immediately due and payable; and/or
	 
	 	(c)	 	declare that all or part of the Loans be payable on demand, whereupon they shall
immediately become payable on demand by the Agent on the instructions of the
Majority Lenders.

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SECTION 9

CHANGES TO PARTIES

	24.	 	CHANGES TO THE LENDERS
	 
	24.1	 	Assignments and transfers by the Lenders
	 
	 	 	Subject to this Clause 24, a Lender (the “Existing Lender”) may:

	 	(a)	 	assign any of its rights; or
	 
	 	(b)	 	transfer by novation any of its rights and obligations,

	 	 	to another bank or financial institution which is a Qualifying Lender or, following the
occurrence of an Event of Default which is continuing, to a trust, fund or other entity
which is regularly
engaged in or established for the purpose of making, purchasing or investing in loans,
securities or other financial assets which, in each case, is a Qualifying Lender (the “New
Lender”).
	 
	24.2	 	Conditions of assignment or transfer

	(a)	 	The consent of the Company is required for an assignment or transfer by an Existing
Lender, unless the assignment or transfer is to another Lender or an Affiliate of a Lender
or following the occurrence of an Event of Default which is continuing.
	 
	(b)	 	The consent of the Company to an assignment or transfer must not be unreasonably
withheld or delayed. The Company will be deemed to have given its consent ten days after
the Existing Lender has requested it unless consent is expressly refused by the Company
within that time.
	 
	(c)	 	The consent of the Company to an assignment or transfer must not be withheld solely
because the assignment or transfer may result in an increase to the Mandatory Costs.
	 
	(d)	 	A partial transfer by a Lender shall be in a minimum amount of £10,000,000.

	 
	(e)	 	An assignment will only be effective on:

	 	(i)	 	receipt by the Agent of written confirmation from the New Lender (in
form and substance satisfactory to the Agent) that the New Lender will assume the
same obligations to the other Finance Parties as it would have been under if it
was an Original Lender; and
	 
	 	(ii)	 	performance by the Agent of all “know your customer” or other checks
relating to any person that it is required to carry out in relation to such
assignment to a New Lender, the completion of which the Agent shall promptly
notify to the Existing Lender and the New Lender.

	(f)	 	A transfer will only be effective if the procedure set out in Clause 24.5 (Procedure
for transfer) is complied with.
	 
	(g)	 	If:

	 	(i)	 	a Lender assigns or transfers any of its rights or obligations under
the Finance Documents or changes its Facility Office; and
	 
	 	(ii)	 	as a result of circumstances existing at the date the assignment,
transfer or change occurs, an Obligor would be obliged to make a payment to the
New Lender or Lender

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	 	 	 	acting through its new Facility Office under Clause 13 (Tax gross-up and indemnities) or
Clause 14 (Increased Costs),

	 	 	then the New Lender or Lender acting through its new Facility Office
is only entitled to receive payment under those Clauses to the same extent as the Existing Lender
or Lender acting through its previous Facility Office would have been if the assignment, transfer
or change had not occurred.
	 
	24.3	 	Assignment or transfer fee
	 
	 	 	The New Lender shall, on the date upon which an assignment or transfer takes effect, pay to
the Agent (for its own account) a fee of £1,250.
	 
	24.4	 	Limitation of responsibility of Existing Lenders

	(a)	 	Unless expressly agreed to the contrary, an Existing Lender makes no representation
or warranty and assumes no responsibility to a New Lender for:

	 	(i)	 	the legality, validity, effectiveness, adequacy or enforceability of
the Finance Documents or any other documents;
	 
	 	(ii)	 	the financial condition of any Obligor;
	 
	 	(iii)	 	the performance and observance by any Obligor of its obligations
under the Finance Documents or any other documents; or
	 
	 	(iv)	 	the accuracy of any statements (whether written or oral) made in or
in connection with any Finance Document or any other document,

	 	 	 	and any representations or warranties implied by law are excluded.

	(b)	 	Each New Lender confirms to the Existing Lender and the other Finance Parties that
it:

	 	(i)	 	has made (and shall continue to make) its own independent
investigation and assessment of the financial condition and affairs of each
Obligor and its related entities in connection with its participation in this
Agreement and has not relied exclusively on any information provided to it by the
Existing Lender in connection with any Finance Document; and
	 
	 	(ii)	 	will continue to make its own independent appraisal of the
creditworthiness of each Obligor and its related entities whilst any amount is or
may be outstanding under the Finance Documents or any Commitment is in force.

	(c)	 	Nothing in any Finance Document obliges an Existing Lender to:

	 	(i)	 	accept a re-transfer from a New Lender of any of the rights and
obligations assigned or transferred under this Clause 24; or
	 
	 	(ii)	 	support any losses directly or indirectly incurred by the New Lender
by reason of the non-performance by any Obligor of its obligations under the
Finance Documents or otherwise.

	24.5	 	Procedure for transfer

	(a)	 	Subject to the conditions set out in Clause 24.2 (Conditions of assignment or
transfer) a transfer is effected in accordance with paragraph (b) below when the Agent
executes an otherwise duly completed Transfer Certificate delivered to it by the Existing
Lender and the New Lender. The

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	 	 	 	Agent shall, subject to paragraph (b) below, as soon as reasonably practicable after
receipt by it of a duly completed Transfer Certificate appearing on its face to comply with
the terms of this Agreement and delivered in accordance with the terms of this Agreement,
execute that Transfer Certificate.

	(b)	 	The Agent shall only be obliged to execute a Transfer Certificate delivered to it by
the Existing Lender and the New Lender once it is satisfied it has complied with all
necessary “know your customer” or other similar checks under all applicable laws and
regulations in relation to the transfer to such New Lender.
	 
	(c)	 	On the Transfer Date:

	 	(i)	 	to the extent that in the Transfer Certificate the Existing Lender
seeks to transfer by novation its rights and obligations under the Finance
Documents each of the Obligors and the Existing Lender shall be released from
further obligations towards one another under the Finance Documents and their
respective rights against one another under the Finance Documents shall be
cancelled (being the “Discharged Rights and Obligations”);
	 
	 	(ii)	 	each of the Obligors and the New Lender shall assume obligations
towards one another and/or acquire rights against one another which differ from
the Discharged Rights and Obligations only insofar as that Obligor and the New
Lender have assumed and/or acquired the same in place of that Obligor and the
Existing Lender;
	 
	 	(iii)	 	the Agent, the Arranger, the New Lender and other Lenders shall
acquire the same rights and assume the same obligations between themselves as they
would have acquired and assumed had the New Lender been an Original Lender with
the rights and/or obligations acquired or assumed by it as a result of the
transfer and to that extent the Agent, the Arranger and the Existing Lender shall
each be released from further obligations to each other under the Finance
Documents; and
	 
	 	(iv)	 	the New Lender shall become a Party as a “Lender”.

	24.6	 	Copy of Transfer Certificate to Company
	 
	 	 	The Agent shall, as soon as reasonably practicable after it has executed a Transfer
Certificate, send to the Company a copy of that Transfer Certificate.
	 
	24.7	 	Disclosure of information
	 
	 	 	Any Lender may disclose, on a need to know basis, to any of its Affiliates and any other person:

	 	(a)	 	to (or through) whom that Lender assigns or transfers (or may
potentially assign or
transfer) all or any of its rights and obligations under this Agreement for the
purpose of that actual or potential assignment or transfer;
	 
	 	(b)	 	with (or through) whom that Lender enters into (or may potentially
enter into) any sub-participation in relation to, or any other transaction under
which payments are to be made by reference to, this Agreement or any Obligor for
the purpose of that actual or potential sub-participation or transfer; or
	 
	 	(c)	 	to whom, and to the extent that, information is required to be
disclosed by any applicable law or regulation,

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	 	 	any information about any Obligor, the Group and the Finance Documents as that Lender shall
consider appropriate if, in relation to paragraphs (a) and (b) above, the person to whom
the information is to be given has entered into a Confidentiality Undertaking. This Clause
supersedes any previous agreement relating to the confidentiality of this information.

	24.9	 	Confidentiality
	 
	 	 	Each Finance Party undertakes with each Obligor:

	 	(a)	 	to keep confidential and not to disclose to anyone any information
(including any projections) relating to the Group, any member of the Group,
Britvic or any Finance Document, in whatever form, and including information given
orally and any document, electronic file or any other way of representing or
recording information which contains or is derived or copied from such information
except:

	 	(i)	 	for any lawfully obtained from any other source, or
that is or becomes public knowledge, other than as a direct or indirect
result of any breach of any obligation of confidentiality; or
	 
	 	(ii)	 	as permitted by Clause 24.7 (Disclosure of
information) or by a Confidentiality Undertaking envisaged by that Clause;

	 	(b)	 	to use that information only for the purpose of, or as permitted by,
the Finance Documents; and
	 
	 	(c)	 	to use all reasonable endeavours to ensure that any person to whom
that Finance Party passes any such information (unless disclosed under paragraph
(c) of Clause 24.7 (Disclosure of information) acknowledges and complies with the
provisions of this Clause 24.8 as if that person were also bound by it.

	25.	 	CHANGES TO THE OBLIGORS
	 
	25.1	 	Assignments and transfer by Obligors
	 
	 	 	No Obligor may assign any of its rights or transfer any of its rights or obligations under
the Finance Documents.
	 
	25.2	 	Additional Borrowers

	(a)	 	IHG may request that the New Parent becomes an Additional Borrower with effect at any
time on or after the New Parent Scheme Date. The New Parent shall become an Additional
Borrower if:

	 	(i)	 	IHG delivers to the Agent a duly completed and executed Accession
Letter in relation to the New Parent becoming an Additional Borrower;
	 
	 	(ii)	 	IHG confirms that no Default is continuing or would occur as a result
of the New Parent becoming an Additional Borrower; and
	 
	 	(iii)	 	the Agent has received all of the documents and other evidence
listed in Part II of Schedule 2 (Conditions Precedent) in relation to the New
Parent, each in form and substance reasonably satisfactory to the Agent.

	(b)	 	Subject to compliance with the provisions of paragraphs (c) and (d) of Clause 20.8
(“Know your customer” checks), the Company may request that any of its Subsidiaries
becomes an Additional Borrower. That Subsidiary shall become an Additional Borrower if:

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	 	(i)	 	all Lenders (acting reasonably) approve the addition of that Subsidiary and which
they shall do so if that Subsidiary is a wholly owned subsidiary incorporated in the
United Kingdom;
	 
	 	(ii)	 	the Company delivers to the Agent a duly completed and executed Accession Letter;
	 
	 	(iii)	 	the Company confirms that no Default is continuing or would occur as a result of
that Subsidiary becoming an Additional Borrower; and
	 
	 	(iv)	 	the Agent has received all of the documents and other evidence listed in Part II of
Schedule 2 (Conditions Precedent) in relation to that Additional Borrower, each in form
and substance reasonably satisfactory to the Agent.

	(c)	 	The Agent shall notify the Company and the Lenders promptly upon being satisfied that
it has received (in form and substance reasonably satisfactory to it) all the documents
and other evidence listed in Part II of Schedule 2 (Conditions Precedent).

	25.3	 	Resignation of a Borrower

	(a)	 	The Company may request that a Borrower (other than IHG prior to the New Parent
Scheme Date and the New Parent from and including the New Parent Scheme Date) ceases to be
a Borrower by delivering to the Agent a Resignation Letter.
	 
	(b)	 	The Agent shall accept a Resignation Letter and notify the Company and the Lenders of
its acceptance if:

	 	(i)	 	no Default is continuing or would result from the acceptance of the
Resignation Letter (and the Company has confirmed this is the case); and
	 
	 	(ii)	 	that Borrower is under no actual or contingent obligations as a
Borrower under any Finance Documents,

	 	 	 	whereupon that company shall cease to be a Borrower and shall have no further rights or
obligations under the Finance Documents.

	25.4	 	Additional Guarantors

	(a)	 	The New Parent shall, on the New Parent Scheme Date, become an Additional Guarantor
and IHG shall:

	 	(i)	 	deliver to the Agent a duly completed and executed Accession Letter
in relation to the New Parent becoming an Additional Guarantor;
	 
	 	(ii)	 	confirm that no Default is continuing or would occur as a result of
the New Parent becoming an Additional Guarantor; and
	 
	 	(iii)	 	procure that the Agent receives all of the documents and other
evidence listed in Part II of Schedule 2 (Conditions Precedent) in relation to the
New Parent, each in form and substance reasonably satisfactory to the Agent.

	(b)	 	Subject to compliance with the provisions of paragraphs (c) and (d) of Clause 20.8
(“Know your customer” checks), the Company may request that any of its Subsidiaries become
an Additional Guarantor. That Subsidiary shall become an Additional Guarantor if:

	 	(i)	 	the Company delivers to the Agent a duly completed and executed
Accession Letter; and

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	 	(ii)	 	the Agent has received all of the documents and other evidence listed
in Part II of Schedule 2 (Conditions Precedent) in relation to that Additional
Guarantor, each in form and substance reasonably satisfactory to the Agent.

	(c)	 	The Agent shall notify the Company and the Lenders promptly upon being satisfied that
it has received (in form and substance reasonably satisfactory to it) all the documents
and other evidence listed in Part II of Schedule 2 (Conditions Precedent).

	25.5	 	Repetition of Representations
	 
	 	 	Delivery of an Accession Letter constitutes confirmation by the New Parent or, as the case
may be, the relevant Subsidiary that the Repeating Representations are true and correct in
relation to it as at the date of delivery as if made by reference to the facts and
circumstances then existing.
	 
	25.6	 	Resignation of a Guarantor

	(a)	 	The Company may request that a Guarantor (other than IHG prior to the New Parent
Scheme Date and the New Parent after the New Parent Scheme Date) ceases to be a Guarantor
by delivering to the Agent a Resignation Letter.
	 
	(b)	 	The Agent shall accept a Resignation Letter and notify the Company and the Lenders of
its acceptance if:

	 	(i)	 	no Default is continuing or would result from the acceptance of the
Resignation Letter (and the Company has confirmed this is the case); and
	 
	 	(ii)	 	the Majority Lenders have consented to the Company’s request (which
they shall do if in relation to any Subsidiary of the Company, Clause 22.4
(Subsidiary Indebtedness) is being complied with at such time).

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SECTION 10

THE FINANCE PARTIES

	26.	 	ROLE OF THE AGENT AND THE ARRANGER
	 
	26.1	 	Appointment of the Agent

	(a)	 	Each other Finance Party appoints the Agent to act as its agent under and in connection with the
Finance Documents.
	 
	(b)	 	Each other Finance Party authorises the Agent to exercise the rights, powers, authorities and
discretions specifically given to the Agent under or in connection with the Finance Documents
together with any other incidental rights, powers, authorities and discretions.

	26.2	 	Duties of the Agent

	(a)	 	The Agent shall promptly forward to a Party the original or a copy of any document
which is delivered to the Agent for that Party by any other Party.
	 
	(b)	 	Except where a Finance Document specifically provides otherwise, the Agent is not
obliged to review or check the adequacy, accuracy or completeness of any document it
forwards to another Party.
	 
	(c)	 	If the Agent receives notice from a Party referring to this Agreement, describing a
Default and stating that the circumstance described is a Default, it shall promptly notify
the Finance Parties.
	 
	(d)	 	If the Agent is aware of the non-payment of any principal, interest, commitment fee
or other fee payable to a Finance Party (other than the Agent or the Arranger) under this
Agreement it shall promptly notify the other Finance Parties.
	 
	(e)	 	The Agent’s duties under the Finance Documents are solely mechanical and
administrative in nature.

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

	(a)	 	Nothing in this Agreement constitutes the Agent or the Arranger as a trustee or
fiduciary of any other person.
	 
	(b)	 	Neither the Agent nor the Arranger shall be bound to account to any Lender for any
sum or the profit element of any sum received by it for its own account.

	26.5	 	Business with the Group
	 
	 	 	The Agent and the Arranger may accept deposits from, lend money to and generally engage in
any kind of banking or other business with any member of the Group.
	 
	26.6	 	Rights and discretions of the Agent

	(a)	 	The Agent may rely on:

	 	(i)	 	any representation, notice or document believed by it to be genuine,
correct and appropriately authorised; and

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	 	(ii)	 	any statement made by a director, authorised signatory or employee of
any person regarding any matters which may reasonably be assumed to be within his
knowledge or within his power to verify.

	(b)	 	The Agent may assume (unless it has received notice to the contrary in its capacity
as agent for the Lenders) that:

	 	(i)	 	no Default has occurred (unless it has actual knowledge of a Default
arising under Clause 23.1 (Non-payment));
	 
	 	(ii)	 	any right, power, authority or discretion vested in any Party or the
Majority Lenders has not been exercised; and
	 
	 	(iii)	 	any notice or request made by the Company (other than a Utilisation
Request or Selection Notice) is made on behalf of and with the consent and
knowledge of all the Obligors.

	(c)	 	The Agent may engage, pay for and rely on the advice or services of any lawyers,
accountants, surveyors or other experts.
	 
	(d)	 	The Agent may act in relation to the Finance Documents through its personnel and
agents.
	 
	(e)	 	The Agent may disclose to any other Party any information it reasonably believes it
has received as agent under this Agreement.
	 
	(f)	 	Notwithstanding any other provision of any Finance Document to the contrary, neither
the Agent nor the Arranger is obliged to do or omit to do anything if it would or might in
its reasonable opinion constitute a breach of any law or regulation or a breach of a
fiduciary duty or duty of confidentiality.

	26.7	 	Majority Lenders’ instructions

	(a)	 	Unless a contrary indication appears in a Finance Document, the Agent shall (i)
exercise any right, power, authority or discretion vested in it as Agent in accordance
with any instructions given to it by the Majority Lenders (or, if so instructed by the
Majority Lenders, refrain from exercising any right, power, authority or discretion vested
in it as Agent) and (ii) not be liable for any act (or omission) if it acts (or refrains
from taking any action) in accordance with an instruction of the Majority Lenders.
	 
	(b)	 	Unless a contrary indication appears in a Finance Document, any instructions given by
the Majority Lenders will be binding on all the Finance Parties.
	 
	(c)	 	The Agent may refrain from acting in accordance with the instructions of the Majority
Lenders (or, if appropriate, the Lenders) until it has received such security as it may
require for any cost, loss or liability (together with any associated VAT) which it may
incur in complying with the instructions.
	 
	(d)	 	In the absence of instructions from the Majority Lenders (or, if appropriate, the
Lenders), the
Agent may act (or refrain from taking action) as it considers to be in the best interest of
the Lenders.
	 
	(e)	 	The Agent is not authorised to act on behalf of a Lender (without first obtaining
that Lender’s consent) in any legal or arbitration proceedings relating to any Finance
Document.

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	26.8	 	Responsibility for documentation
	 
	 	 	Neither the Agent nor the Arranger:

	 	(a)	 	is responsible for the adequacy, accuracy and/or completeness of any
information (whether oral or written) supplied by the Agent, the Arranger, an
Obligor or any other person given in or in connection with any Finance Document or
the Information Memorandum; or
	 
	 	(b)	 	is responsible for the legality, validity, effectiveness, adequacy or
enforceability of any Finance Document or any other agreement, arrangement or
document entered into, made or executed in anticipation of or in connection with
any Finance Document.

	26.9	 	Exclusion of liability

	(a)	 	Without limiting paragraph (b) below, the Agent will not be liable for any action
taken by it under or in connection with any Finance Document, unless directly caused by
its gross negligence or wilful misconduct.
	 
	(b)	 	No Party (other than the Agent) may take any proceedings against any officer,
employee or agent of the Agent in respect of any claim it might have against the Agent or
in respect of any act or omission of any kind by that officer, employee or agent in
relation to any Finance Document and any officer, employee or agent of the Agent may rely
on this Clause.
	 
	(c)	 	The Agent will not be liable for any delay (or any related consequences) in crediting
an account with an amount required under the Finance Documents to be paid by the Agent if
the Agent has taken all necessary steps as soon as reasonably practicable to comply with
the regulations or operating procedures of any recognised clearing or settlement system
used by the Agent for that purpose.
	 
	(d)	 	Nothing in this Agreement shall oblige the Agent or the Arranger to carry out any
“know your customer” or other checks in relation to any person on behalf of any Lender and
each Lender confirms to the Agent and the Arranger that it is solely responsible for any
such checks it is required to carry out and that it may not rely on any statement in
relation to such checks made by the Agent or the Arranger.

	26.10	 	Lenders’ indemnity to the Agent
	 
	 	 	Each Lender shall (in proportion to its share of the Total Commitments or, if the Total
Commitments are then zero, to its share of the Total Commitments immediately prior to their
reduction to zero) indemnify the Agent, within three Business Days of demand, against any
cost, loss or liability incurred by the Agent (otherwise than by reason of the Agent’s
gross negligence or wilful misconduct) in acting as Agent under the Finance Documents
(unless the Agent has been reimbursed by an Obligor pursuant to a Finance Document).
	 
	26.11	 	Resignation of the Agent

	(a)	 	The Agent may resign and appoint one of its Affiliates acting through an office in
the United Kingdom as successor by giving notice to the other Finance Parties and the
Company.
	 
	(b)	 	Alternatively the Agent may resign by giving notice to the other Finance Parties and
the Company, in which case the Majority Lenders (after consultation with the Company) may
appoint a successor Agent.

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	(c)	 	If the Majority Lenders have not appointed a successor Agent in accordance with
paragraph (b) above within 30 days after notice of resignation was given, the Agent (after
consultation with the Company) may appoint a successor Agent (acting through an office in
the United Kingdom).
	 
	(d)	 	The retiring Agent shall, at its own cost, make available to the successor Agent such
documents and records and provide such assistance as the successor Agent may reasonably
request for the purposes of performing its functions as Agent under the Finance Documents.
	 
	(e)	 	The Agent’s resignation notice shall only take effect upon the appointment of a
successor.
	 
	(f)	 	Upon the appointment of a successor, the retiring Agent shall be discharged from any
further obligation in respect of the Finance Documents but shall remain entitled to the
benefit of this Clause 26. Its successor and each of the other Parties shall have the same
rights and obligations amongst themselves as they would have had if such successor had
been an original Party.
	 
	(g)	 	After consultation with the Company the Majority Lenders may, by notice to the Agent,
require it to resign in accordance with paragraph (b) above. In this event, the Agent
shall resign in accordance with paragraph (b) above.

	26.12	 	Confidentiality

	(a)	 	In acting as agent for the Finance Parties, the Agent shall be regarded as acting through its
agency division which shall be treated as a separate entity from any other of its divisions or
departments.
	 
	(b)	 	If information is received by another division or department of the Agent, it may be treated as
confidential to that division or department and the Agent shall not be deemed to have notice of it.

	26.13	 	Relationship with the Lenders

	(a)	 	The Agent may treat each Lender as a Lender, entitled to payments under this
Agreement and acting through its Facility Office unless it has received not less than five
Business Days prior notice from that Lender to the contrary in accordance with the terms
of this Agreement.
	 
	(b)	 	Each Lender shall supply the Agent with any information required by the Agent in
order to calculate the Mandatory Cost in accordance with Schedule 4 (Mandatory Cost
formulae).

	26.14	 	Credit appraisal by the Lenders
	 
	 	 	Without affecting the responsibility of any Obligor for information supplied by it
or on its behalf in connection with any Finance Document, each Lender confirms to
the Agent and the Arranger that it has been, and will continue to be, solely
responsible for making its own independent appraisal and investigation of all risks
arising under or in connection with any Finance Document including but not limited
to:

	 	(a)	 	the financial condition, status and nature of each
member of the Group;
	 
	 	(b)	 	the legality, validity, effectiveness, adequacy or
enforceability of any Finance Document and any other agreement,
arrangement or document entered into, made or executed in anticipation of,
under or in connection with any Finance Document;
	 
	 	(c)	 	whether that Lender has recourse, and the nature and
extent of that recourse, against any Party or any of its respective assets
under or in connection with any Finance Document, the transactions
contemplated by the Finance Documents or any other

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	 	 	 	agreement, arrangement or document entered into, made or executed in anticipation
of, under or in connection with any Finance Document; and
	 
	 	(d)	 	the adequacy, accuracy and/or completeness of the Information
Memorandum and any other information provided by the Agent, any Party or by any
other person under or in
connection with any Finance Document, the transactions contemplated by the Finance
Documents or any other agreement, arrangement or document entered into, made or
executed in anticipation of, under or in connection with any Finance Document.

	26.15	 	Reference Banks
	 
	 	 	If a Reference Bank (or, if a Reference Bank is not a Lender, the Lender of which it is an
Affiliate) ceases to be a Lender, the Agent shall (in agreement with the Company, such
agreement not to be unreasonably withheld) appoint another Lender or an Affiliate of a
Lender to replace that Reference Bank.
	 
	26.16	 	Deduction from amounts payable by the Agent
	 
	 	 	If any Party owes an amount to the Agent under the Finance Documents the Agent may, after
giving notice to that Party, deduct an amount not exceeding that amount from any payment to
that Party which the Agent would otherwise be obliged to make under the Finance Documents
and apply the amount deducted in or towards satisfaction of the amount owed. For the
purposes of the Finance Documents that Party shall be regarded as having received any
amount so deducted.
	 
	27.	 	CONDUCT OF BUSINESS BY THE FINANCE PARTIES
	 
	 	 	No provision of this Agreement will:

	 	(a)	 	interfere with the right of any Finance Party to arrange its affairs
(tax or otherwise) in whatever manner it thinks fit;
	 
	 	(b)	 	oblige any Finance Party to investigate or claim any credit, relief,
remission or repayment available to it or the extent, order and manner of any
claim; or
	 
	 	(c)	 	oblige any Finance Party to disclose any information relating to its
affairs (tax or otherwise) or any computations in respect of Tax.

	28.	 	SHARING AMONG THE FINANCE PARTIES
	 
	28.1	 	Payments to Finance Parties
	 
	 	 	If a Finance Party (a “Recovering Finance Party”) receives or recovers any amount from an
Obligor other than in accordance with Clause 29 (Payment mechanics) and applies that amount
to a payment due under the Finance Documents then:

	 	(a)	 	the Recovering Finance Party shall, within three Business Days,
notify details of the receipt or recovery to the Agent;
	 
	 	(b)	 	the Agent shall determine whether the receipt or recovery is in
excess of the amount the Recovering Finance Party would have been paid had the
receipt or recovery been received or made by the Agent and distributed in
accordance with Clause 29 (Payment mechanics), without taking account of any Tax
which would be imposed on the Agent in relation to the receipt, recovery or
distribution; and

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	 	(c)	 	the Recovering Finance Party shall, within three Business Days of
demand by the Agent, pay to the Agent an amount (the “Sharing Payment”) equal to
such receipt or recovery less any amount which the Agent determines may be
retained by the Recovering Finance Party as its share of any payment to be made,
in accordance with Clause 29.5 (Partial payments).

	28.2	 	Redistribution of payments
	 
	 	 	The Agent shall treat the Sharing Payment as if it had been paid by the relevant Obligor
and distribute it between the Finance Parties (other than the Recovering Finance Party) in
accordance with Clause 29.5 (Partial payments).
	 
	28.3	 	Recovering Finance Party’s rights

	(a)	 	On a distribution by the Agent under Clause 28.2 (Redistribution of payments), the
Recovering Finance Party will be subrogated to the rights of the Finance Parties which
have shared in the redistribution.
	 
	(b)	 	If and to the extent that the Recovering Finance Party is not able to rely on its
rights under paragraph (a) above, the relevant Obligor shall be liable to the Recovering
Finance Party for a debt
equal to the Sharing Payment which is immediately due and payable.

	28.4	 	Reversal of redistribution
	 
	 	 	If any part of the Sharing Payment received or recovered by a Recovering Finance Party
becomes repayable and is repaid by that Recovering Finance Party, then:

	 	(a)	 	each Finance Party which has received a share of the relevant Sharing
Payment pursuant to Clause 28.2 (Redistribution of payments) shall, upon request
of the Agent, pay to the Agent for account of that Recovering Finance Party an
amount equal to the appropriate part of its share of the Sharing Payment (together
with an amount as is necessary to reimburse that Recovering Finance Party for its
proportion of any interest on the Sharing Payment which that Recovering Finance
Party is required to pay); and
	 
	 	(b)	 	that Recovering Finance Party’s rights of subrogation in respect of
any reimbursement shall be cancelled and the relevant Obligor will be liable to
the reimbursing Finance Party for the amount so reimbursed.

	28.5	 	Exceptions

	(a)	 	This Clause 28 shall not apply to the extent that the Recovering Finance Party would
not, after making any payment pursuant to this Clause, have a valid and enforceable claim
against the relevant Obligor.
	 
	(b)	 	A Recovering Finance Party is not obliged to share with any other Finance Party any
amount which the Recovering Finance Party has received or recovered as a result of taking
legal or arbitration proceedings, if:

	 	(i)	 	it notified that other Finance Party of the legal or arbitration
proceedings; and
	 
	 	(ii)	 	that other Finance Party had an opportunity to participate in those
legal or arbitration proceedings but did not do so as soon as reasonably
practicable having received notice and did not take separate legal or arbitration
proceedings.

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SECTION 11

ADMINISTRATION

	29.	 	PAYMENT MECHANICS
	 
	29.1	 	Payments to the Agent

	(a)	 	On each date on which an Obligor or a Lender is required to make a payment under a
Finance Document, that Obligor or Lender shall make the same available to the Agent
(unless a contrary indication appears in a Finance Document) for value on the due date at
the time and in such funds specified by the Agent as being customary at the time for
settlement of transactions in the relevant currency in the place of payment.
	(b)	 	Payment shall be made to such account in the principal financial centre of the
country of that currency (or, in relation to euro, in the principal financial centre in a
Participating Member State or London) with such bank as the Agent specifies.

	29.2	 	Distributions by the Agent
	 
	 	 	Each payment received by the Agent under the Finance Documents for another Party shall,
subject to Clause 29.3 (Distributions to an Obligor) and Clause 29.4 (Clawback), be made
available by the Agent as soon as practicable after receipt to the Party entitled to
receive payment in accordance with this Agreement (in the case of a Lender, for the account
of its Facility Office), to such account as that Party may notify to the Agent by not less
than five Business Days’ notice with a bank in the principal financial centre of the
country of that currency (or, in relation to euro, in the principal financial centre of a
Participating Member State or London).
	 
	29.3	 	Distributions to an Obligor
	 
	 	 	The Agent may (with the consent of the Obligor or in accordance with Clause 30 (Set-off))
apply
any amount received by it for that Obligor in or towards payment (on the date and in the
currency and funds of receipt) of any amount due from that Obligor under the Finance
Documents or in or towards purchase of any amount of any currency to be so applied.
	 
	29.4	 	Clawback

	(a)	 	Where a sum is to be paid to the Agent under the Finance Documents for another Party,
the Agent is not obliged to pay that sum to that other Party (or to enter into or perform
any related exchange contract) until it has been able to establish to its satisfaction
that it has actually received that sum.
	(b)	 	If the Agent pays an amount to another Party and it proves to be the case that the
Agent had not actually received that amount, then the Party to whom that amount (or the
proceeds of any related exchange contract) was paid by the Agent shall on demand refund
the same to the Agent together with interest on that amount from the date of payment to
the date of receipt by the Agent, calculated by the Agent to reflect its cost of funds.

	29.5	 	Partial payments

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

68

 

	 	(i)	 	first, in or towards payment pro rata of any unpaid fees, costs and expenses of the
Agent or the Arranger under the Finance Documents;
	 
	 	(ii)	 	secondly, in or towards payment pro rata of any accrued interest, fee or commission
due but unpaid under this Agreement;
	 
	 	(iii)	 	thirdly, in or towards payment pro rata of any principal due but unpaid under this
Agreement; and
	 
	 	(iv)	 	fourthly, in or towards payment pro rata of any other sum due but unpaid under the
Finance Documents.

	(b)	The Agent shall, if so directed by the Majority Lenders, vary the order set out in
paragraphs (a)(ii) to (iv) above.
	 
	(c)	Paragraphs (a) and (b) above will override any appropriation made by an Obligor.

	29.6	 	No set-off by Obligors
	 
	 	 	All payments to be made by an Obligor under the Finance Documents shall be calculated and
be made without (and free and clear of any deduction for) set-off or counterclaim.
	 
	29.7	 	Business Days

	(a)	Any payment which is due to be made on a day that is not a Business Day shall be made
on the next Business Day in the same calendar month (if there is one) or the preceding
Business Day (if there is not).
	 
	(b)	During any extension of the due date for payment of any principal or Unpaid Sum under
this Agreement interest is payable on the principal or Unpaid Sum at the rate payable on
the original due date.

	29.8	 	Currency of account

	(a)	Subject to paragraphs (b) to (e) below, the Base Currency is the currency of account
and payment for any sum due from an Obligor under any Finance Document.
	 
	(b)	A repayment of a Loan or Unpaid Sum or a part of a Loan or Unpaid Sum shall be made
in the currency in which that Loan or Unpaid Sum is denominated on its due date.
	 
	(c)	Each payment of interest shall be made in the currency in which the sum in respect of
which the interest is payable was denominated when that interest accrued.
	 
	(d)	Each payment in respect of costs, expenses or Taxes shall be made in the currency in
which the costs, expenses or Taxes are incurred.
	 
	(e)	Any amount expressed to be payable in a currency other than the Base Currency shall
be paid in that other currency.

	29.9	 	Change of currency

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

	 	(i)	 	any reference in the Finance Documents to, and any obligations
arising under the Finance Documents in, the currency of that country shall be
translated into, or paid in,

69

 

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

	(b)	If a change in any currency of a country occurs, this Agreement will, to the extent
the Agent (acting reasonably and after consultation with the Company) specifies to be
necessary, be amended to comply with any generally accepted conventions and market
practice in the Relevant Interbank Market and otherwise to reflect the change in currency.

	30.	 	SET-OFF
	 
	 	 	Without prejudice to the normal rights of the Finance Parties at law, after the occurrence
of an Event of Default which is continuing, a Finance Party may set off any matured
obligation due from an Obligor under the Finance Documents (to the extent beneficially
owned by that Finance Party) against any matured obligation owed by that Finance Party to
that Obligor, regardless of the place of payment, booking branch or currency of either
obligation. If the obligations are in different currencies, the Finance Party may convert
either obligation at a market rate of exchange in its usual course of business for the
purpose of the set-off. That Finance Party shall promptly notify that Obligor of any such
set-off or conversion.
	 
	31.	 	NOTICES
	 
	31.1	 	Communications in writing
	 
	 	 	Any communication to be made under or in connection with the Finance Documents shall be
made in writing and, unless otherwise stated, may be made by fax or letter.
	 
	31.2	 	Addresses
	 
	 	 	The address and fax number (and the department or officer, if any, for whose attention the
communication is to be made) of each Party for any communication or document to be made or
delivered under or in connection with the Finance Documents is:

	 	(a)	 	in the case of the Company, that identified with its name below;
	 
	 	(b)	 	in the case of each Lender or any other Obligor, that notified in
writing to the Agent on or prior to the date on which it becomes a Party; and
	 
	 	(c)	 	in the case of the Agent, that identified with its name below,

	 	 	or any substitute address, fax number or department or officer as the Party may notify to
the Agent (or the Agent may notify to the other Parties, if a change is made by the Agent)
by not less than five Business Days’ notice.
	 
	31.3	 	Delivery

	(a)	Any communication or document made or delivered by one person to another under or in
connection with the Finance Documents will only be effective:

	 	(i)	 	if by way of fax, when received in legible form; or

70

 

	 	(ii)	 	if by way of letter, when it has been left at the relevant address or five Business
Days after being deposited in the post postage prepaid in an envelope addressed to it at
that address,

	 	and, if a particular department or officer is specified as part of its address details provided
under Clause 31.2 (Addresses), if addressed to that department or officer.
	 
	(b)	Any communication or document to be made or delivered to the Agent will be effective
only when actually received by the Agent and then only if it is expressly marked for the
attention of the department or officer identified with the Agent’s signature below (or any
substitute department or officer as the Agent shall specify for this purpose).
	 
	(c)	All notices from or to an Obligor shall be sent through the Agent.
	 
	(d)	Any communication or document made or delivered to the Company in accordance with
this Clause will be deemed to have been made or delivered to each of the Obligors.

	31.4	 	Notification of address and fax number
	 
	 	 	Promptly upon receipt of notification of an address and fax number or change of address or
fax number pursuant to Clause 31.2 (Addresses) or changing its own address or fax number,
the Agent shall notify the other Parties.
	 
	31.5	 	Electronic communication

	(a)	 	Any communication to be made between the Agent and a Lender or an Obligor and the
Agent under or in connection with the Finance Documents may be made by electronic mail or
other electronic means, if the Agent and the relevant Lender or, as appropriate, the
relevant Obligor and the Agent:

	 	(i)	 	agree that, unless and until notified to the contrary, this is to be
an accepted form of communication;
	 
	 	(ii)	 	notify each other in writing of their electronic mail address and/or
any other information required to enable the sending and receipt of information by
that means; and
	 
	 	(iii)	 	notify each other of any change to their address or any other such
information supplied by them.

	(b)	Any electronic communication made between the Agent and a Lender or an Obligor and
the Agent will be effective only when actually received in readable form and in the case
of any electronic communication made by a Lender to the Agent or an Obligor to the Agent
only if it is addressed in such a manner as the Agent shall specify for this purpose.
	 
	(c)	The ability of an Obligor to use electronic communications is without prejudice to
its obligation to submit any Utilisation Request, Selection Notice, Accession Letter,
Resignation Letter, Term Out Notice or Compliance Certificate in the form required under
this Agreement or any other document or notice which requires the signature of any
director or authorised signatory of an Obligor.

	31.6	 	English language

	(a)	Any notice given under or in connection with any Finance Document must be in English.
	 
	(b)	All other documents provided under or in connection with any Finance Document must
be:

71

 

	 	(i)	 	in English; or
	 
	 	(ii)	 	if not in English, and if so required by the Agent, accompanied by a
certified English translation and, in this case, the English translation will
prevail unless the document is a
constitutional, statutory or other official document.

	32.	 	CALCULATIONS AND CERTIFICATES
	 
	32.1	 	Accounts
	 
	 	 	In any litigation or arbitration proceedings arising out of or in connection with a Finance
Document, the entries made in the accounts maintained by a Finance Party are prima facie
evidence of the matters to which they relate.
	 
	32.2	 	Certificates and Determinations
	 
	 	 	Any certification or determination by a Finance Party of a rate or amount under any Finance
Document shall set out the basis of calculation in reasonable detail and is prima facie
evidence of the matters to which it relates.
	 
	32.3	 	Day count convention
	 
	 	 	Any interest, commission or fee accruing under a Finance Document will accrue from day to
day and is calculated on the basis of the actual number of days elapsed and a year of 365
days in the case of sterling or 360 days in the case of euros and US Dollars or, in any
case where the practice in the Relevant Interbank Market differs, in accordance with that
market practice.
	 
	33.	 	PARTIAL INVALIDITY
	 
	 	 	If, at any time, any provision of the Finance Documents is or becomes illegal, invalid or
unenforceable in any respect under any law of any jurisdiction, neither the legality,
validity or enforceability of the remaining provisions nor the legality, validity or
enforceability of such provision under the law of any other jurisdiction will in any way be
affected or impaired.
	 
	34.	 	REMEDIES AND WAIVERS
	 
	 	 	No failure to exercise, nor any delay in exercising, on the part of any Finance Party, any
right or remedy under the Finance Documents shall operate as a waiver, nor shall any single
or partial exercise of any right or remedy prevent any further or other exercise or the
exercise of any other right or remedy. The rights and remedies provided in this Agreement
are cumulative and not exclusive of any rights or remedies provided by law.
	 
	35.	 	AMENDMENTS AND WAIVERS
	 
	35.1	 	Required consents

	(a)	 	Subject to Clause 35.2 (Exceptions) any term of the Finance Documents may be amended
or waived only with the consent of the Majority Lenders and the Obligors and any such
amendment or waiver will be binding on all Parties.
	 
	(b)	 	The Agent may effect, on behalf of any Finance Party, any amendment or waiver
permitted by this Clause.

72

 

	35.2	 	Exceptions

	(a)	 	An amendment or waiver that has the effect of changing or which relates to:

	 	(i)	 	the definition of “EURIBOR”, “LIBOR” or “Majority Lenders” in Clause
1.1 (Definitions);
	 
	 	(ii)	 	an extension to the date of payment of any amount under the Finance
Documents;
	 
	 	(iii)	 	a reduction in the Margin or a reduction in the amount of any
payment of principal, interest, fees or commission payable;
	 
	 	(iv)	 	an increase in or an extension of any Commitment;
	 
	 	(v)	 	a change to the Borrowers or Guarantors other than in accordance with
Clause 25 (Changes to the Obligors);
	 
	 	(vi)	 	any provision which expressly requires the consent of all the
Lenders; or
	 
	 	(vii)	 	Clause 2.2 (Finance Parties’ rights and obligations), Clause 24
(Changes to the Lenders), Clause 28 (Sharing among the Finance Parties), or this
Clause 35,

	 	 	 	shall not be made without the prior consent of all the Lenders.

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

	36.	 	COUNTERPARTS
	 
	 	 	Each Finance Document may be executed in any number of counterparts, and this has the same
effect as if the signatures on the counterparts were on a single copy of the Finance
Document.

73

 

SECTION 12

GOVERNING LAW AND ENFORCEMENT

	37.	 	GOVERNING LAW
	 
	 	 	This Agreement is governed by English law.
	 
	38.	 	ENFORCEMENT
	 
	38.1	 	Jurisdiction

	(a)	 	The courts of England have exclusive jurisdiction to settle any dispute arising out
of or in connection with this Agreement (including a dispute regarding the existence,
validity or termination of this Agreement) (a “Dispute”).
	 
	(b)	 	The Parties agree that the courts of England are the most appropriate and convenient
courts to settle Disputes and accordingly no Party will argue to the contrary.
	 
	(c)	 	This Clause 38.1 is for the benefit of the Finance Parties only. As a result, no
Finance Party shall be prevented from taking proceedings relating to a dispute in any
other courts with jurisdiction. To the extent allowed by law, the Finance Parties may take concurrent proceedings in any
number of jurisdictions.

	38.2	 	Service of process
	 
	 	 	Without prejudice to any other mode of service allowed under any relevant law, each
Obligor (other than an Obligor incorporated in England and Wales):

	 	(a)	 	irrevocably appoints the Company as its agent for
service of process in relation to any proceedings before the English
courts in connection with any Finance Document; and
	 
	 	(b)	 	agrees that failure by a process agent to notify the
relevant Obligor of the process will not invalidate the proceedings
concerned.

This Agreement has been entered into on the date stated at the beginning of this Agreement.

74

 

SCHEDULE 1

THE ORIGINAL LENDERS

	 	 	 	 	 	 	 	 	 
	Name of Original Lender	 	Facility A Commitment	 	 	Facility B Commitment	 
	The Bank of
Tokyo-Mitsubishi, Ltd.
	 	£	122,222,222.22	 	 	£	55,555,555.56	 
	Barclays Bank PLC
	 	£	122,222,222.22	 	 	£	55,555,555.56	 
	Citibank, N.A.
	 	£	122,222,222.22	 	 	£	55,555,555.56	 
	HSBC Bank plc
	 	£	122,222,222.22	 	 	£	55,555,555.56	 
	JPMorgan Chase Bank
	 	£	122,222,222.22	 	 	£	55,555,555.56	 
	Lloyds TSB Bank plc
	 	£	122,222,222.22	 	 	£	55,555,555.55	 
	Société Générale
	 	£	122,222,222.22	 	 	£	55,555,555.55	 
	The Royal Bank of Scotland plc
	 	£	122,222,222.23	 	 	£	55,555,555.55	 
	WestLB AG, London Branch
	 	£	122,222,222.23	 	 	£	55,555,555.55	 

75

 

SCHEDULE 2

CONDITIONS PRECEDENT

PART I

CONDITIONS PRECEDENT TO INITIAL UTILISATION

	1.	 	The Company

	(a)	 	A copy of the constitutional documents of each Original Obligor.
	 
	(b)	 	A copy of a resolution of the board of directors and/or a committee of the board of
directors of each Original Obligor (together with a copy of the resolutions appointing
such committee):

	 	(i)	 	approving the terms of, and the transactions contemplated by, the
Finance Documents and resolving that it execute the Finance Documents;
	 
	 	(ii)	 	authorising a specified person or persons to execute the Finance
Documents on its behalf; and
	 
	 	(iii)	 	authorising a specified person or persons, on its behalf, to sign
and/or despatch all documents and notices (including, if relevant, any Utilisation
Request and Selection Notice) to be signed and/or despatched by it under or in
connection with the Finance Documents.

	(c)	 	A specimen of the signature of each person authorised by the resolution referred to
in paragraph (b) above.
	 
	(d)	 	A copy of any necessary resolution signed by the holders of the issued shares in each
Original Guarantor (other than IHG) which is a Subsidiary of IHG and is incorporated in
England and Wales, approving the terms of, and the transactions contemplated by, the
Finance Documents to which the Original Guarantor is a party.
	 
	(e)	 	A certificate of IHG (signed by a duly authorised officer) confirming that borrowing
or guaranteeing, as appropriate, the Total Commitments would not cause any borrowing,
guaranteeing or similar limit binding on any Original Obligor to be exceeded.
	 
	(f)	 	A certificate of each Original Obligor (signed by an authorised signatory) certifying
that each copy document relating to it specified in this Part I of Schedule 2 is correct,
complete and in full force and effect as at a date no earlier than the date of this
Agreement.
	 
	(g)	 	The Original Financial Statements of each Original Obligor.
	 
	(h)	 	A cancellation notice (which shall be irrevocable) in respect of the Existing
Facility to be effective on the date of this Agreement and such that the Existing Facility
will be cancelled and prepaid in full on the first Utilisation Date under this Agreement.

	2.	 	Legal opinions
	 
	 	 	A legal opinion of Clifford Chance, Limited Liability Partnership, legal advisers to the
Arranger and the Agent in England, substantially in the form distributed to the Original
Lenders prior to signing this Agreement.

76

 

PART II

CONDITIONS PRECEDENT REQUIRED TO BE

DELIVERED BY AN ADDITIONAL OBLIGOR

	1.	 	An Accession Letter, duly executed by the Additional Obligor and (if different) the
Company.
	 
	2.	 	A copy of the constitutional documents of the Additional Obligor.
	 
	3.	 	A copy of a resolution of (or of a committee of) the board of directors of the
Additional Obligor:

	 	(a)	 	approving the terms of, and the transactions contemplated by, the
Accession Letter and the Finance Documents and resolving that it execute the
Accession Letter;
	 
	 	(b)	 	authorising a specified person or persons to execute the Accession
Letter on its behalf; and
	 
	 	(c)	 	authorising a specified person or persons, on its behalf, to sign
and/or despatch all other documents and notices (including, in relation to an
Additional Borrower, any Utilisation Request or Selection Notice) to be signed
and/or despatched by it under or in connection with the Finance Documents.

	4.	 	A specimen of the signature of each person authorised by the resolution referred to
in paragraph 3 above.
	 
	5.	 	A copy of any necessary resolutions signed by all the holders of the issued shares of
the Additional Guarantor (other than the New Parent) which are members of the Group,
approving the terms of, and the transactions contemplated by, the Finance Documents to
which the Additional Guarantor is a party.
	 
	6.	 	A certificate of the Additional Obligor (signed by an authorised signatory)
confirming that borrowing or guaranteeing, as appropriate, the Total Commitments would not
cause any borrowing, guaranteeing or similar limit binding on it to be exceeded.
	 
	7.	 	A certificate of the Additional Obligor (signed by an authorised signatory)
certifying that each copy document listed in this Part II of Schedule 2 is correct,
complete and in full force and effect as at a date no earlier than the date of the
Accession Letter.
	 
	8.	 	If available, the latest audited financial statements of the Additional Obligor.
	 
	9.	 	A legal opinion of Clifford Chance, Limited Liability Partnership, legal advisers to
the Arranger and the Agent in England.
	 
	10.	 	If the Additional Obligor is incorporated in a jurisdiction other than England and
Wales, a legal opinion of the legal advisers to the Arranger and the Agent in the
jurisdiction in which the Additional Obligor is incorporated.
	 
	11.	 	If the proposed Additional Obligor is incorporated in a jurisdiction other than
England and Wales, evidence that the process agent specified in Clause 38.2 (Service of
process), if not an Obligor, has accepted its appointment in relation to the proposed
Additional Obligor.

77

 

SCHEDULE 3

REQUESTS

PART I

UTILISATION REQUEST

	 	 	 
	From:

	 	[Borrower]
	 
	 	 
	To:

	 	[Agent]
	 
	 	 
	Dated:
	 	 

Dear Sirs

InterContinental Hotels Group PLC — £1,600,000,000 Facility Agreement

dated 9 November 2004 (the “Agreement”)

	1.	 	We refer to the Agreement. This is a Utilisation Request. Terms defined in the
Agreement have the same meaning in this Utilisation Request unless given a different
meaning in this Utilisation Request.
	 
	2.	 	We wish to borrow a Loan on the following terms:

	 	 	 	 	 
	 

	 	Proposed Utilisation Date:
	 	[                    ] (or, if that is not a Business Day, the next Business Day)
	

	 	 	 	 
	

	 	Facility to be utilised:
	 	[Facility A]/[Facility B]1
	

	 	 	 	 
	

	 	Currency of Loan:
	 	[                    ]
	

	 	 	 	 
	

	 	Amount:
	 	[                    ] or, if less, the Available Facility
	

	 	 	 	 
	

	 	Interest Period:
	 	[                    ]

	3.	 	We confirm that each condition specified in Clause 4.2 (Further conditions precedent)
is satisfied on the date of this Utilisation Request.
	 
	4.	 	The proceeds of this Loan should be credited to [account].
	 
	5.	 	This Utilisation Request is irrevocable.

Yours faithfully

 

 

authorised signatory for

[name of relevant Borrower]

1    Delete as appropriate.

78

 

PART II

SELECTION NOTICE

APPLICABLE TO A TERM LOAN

	 	 	 
	From:

	 	[Borrower or the Company on behalf of [name of relevant Borrower]]
	 
	 	 
	To:

	 	[Agent]
	 
	 	 
	Dated:
	 	 

Dear Sirs

InterContinental Hotels Group PLC — £1,600,000,000 Facility Agreement

dated 9 November 2004 (the “Agreement”)

	1.	 	We refer to the Agreement. This is a Selection Notice. Terms defined in the Agreement
have the same meaning in this Selection Notice unless given a different meaning in this
Selection Notice.
	 
	2.	 	We refer to the following Term Loan[s] in [identify currency] with an Interest Period
ending on [                    ].1
	 
	3.	 	[We request that the above Term Loan[s] be divided into [                    ] Term Loan with the
following Base Currency Amounts and Interest Periods:]2
	 
	 	 	or
	 
	 	 	[We request that the next Interest Period for the above Term Loan[s] is [                    ]].3
	 
	4.	 	We request that the above Term Loan[s] [is]/[are] [denominated in the same currency for the next
Interest Period]/[denominated in the following currencies: [          ]. As this results in a
change of currency we confirm that each condition specified in Clause 4.2 (Further conditions
precedent) is satisfied on the date of this Selection Notice. The proceeds of any change in
currency should be credited to [account]].
	 
	5.	 	This Selection Notice is irrevocable.

Yours faithfully

 

 

authorised signatory for

[the Borrower or the Company on behalf of]

[name of relevant Borrower]

1    Insert details of all Term Loans in the same currency which have an Interest Period
ending on the same date.

2    Use this option if division of Term Loans is requested.

3    Use this option if sub-division is not required.

79

 

SCHEDULE 4

MANDATORY COST FORMULAE

	1.	 	The Mandatory Cost is an addition to the interest rate to compensate Lenders for the
cost of compliance with (a) the requirements of the Bank of England and/or the Financial
Services Authority (or, in either case, any other authority which replaces all or any of
its functions) or (b) the requirements of the European Central Bank.
	 
	2.	 	On the first day of each Interest Period (or as soon as possible thereafter) the
Agent shall calculate, as a percentage rate, a rate (the “Additional Cost Rate”) for each
Lender, in accordance with the paragraphs set out below. The Mandatory Cost will be
calculated by the Agent as a weighted average of the Lenders’ Additional Cost Rates
(weighted in proportion to the percentage participation of each Lender in the relevant
Loan) and will be expressed as a percentage rate per annum.
	 
	3.	 	The Additional Cost Rate for any Lender lending from a Facility Office in a
Participating Member State will be the percentage notified by that Lender to the Agent.
This percentage will be certified by that Lender in its notice to the Agent to be its
reasonable determination of the cost (expressed as a percentage of that Lender’s
participation in all Loans made from that Facility Office) of complying with the minimum
reserve requirements of the European Central Bank in respect of loans made from that
Facility Office.
	 
	4.	 	The Additional Cost Rate for any Lender lending from a Facility Office in the United
Kingdom will be calculated by the Agent as follows:

	 	(a)	 	in relation to a sterling Loan:

	 	 	 
	AB + C(B – D) + E x 0.01	 	 
	

	 	per cent. per annum
	100 – (A + C)	 	 

	 	(b)	 	in relation to a Loan in any currency other than sterling:

	 	 	 
	E x 0.01	 	 
	

	per cent. per annum.
	300	 	 

	 	 	Where:

	 	A 	 	is the percentage of Eligible Liabilities (assuming these to be in excess of any
stated minimum) which that Lender is from time to time required to maintain as an interest
free cash ratio deposit with the Bank of England to comply with cash ratio requirements.
	 
	 	B 	 	is the percentage rate of interest (excluding the Margin and the Mandatory Cost and,
if the Loan is an Unpaid Sum, the additional rate of interest specified in paragraph (a)
of Clause 9.3 (Default interest)) payable for the relevant Interest Period on the Loan.
	 
	 	C 	 	is the percentage (if any) of Eligible Liabilities which that Lender is required from
time to time to maintain as interest bearing Special Deposits with the Bank of England.
	 
	 	D 	 	is the percentage rate per annum payable by the Bank of England to the Agent on
interest bearing Special Deposits.

80

 

	 	E 	 	is designed to compensate Lenders for amounts payable under the Fees Rules and is
calculated by the Agent as being the average of the most recent rates of charge
supplied by the Reference Banks to the Agent pursuant to paragraph 7 below and
expressed in pounds per £1,000,000.

	5.	 	For the purposes of this Schedule:

	 	(a)	 	“Eligible Liabilities” and “Special Deposits” have the meanings given
to them from time to time under or pursuant to the Bank of England Act 1998 or (as
may be appropriate) by the Bank of England;
	 
	 	(b)	 	“Fees Rules” means the rules on periodic fees contained in the FSA
Supervision Manual or such other law or regulation as may be in force from time to
time in respect of the payment of fees for the acceptance of deposits;
	 
	 	(c)	 	“Fee Tariffs” means the fee tariffs specified in the Fees Rules under
the activity group A.1 Deposit acceptors (ignoring any minimum fee or zero rated
fee required pursuant to the Fees Rules but taking into account any applicable
discount rate); and
	 
	 	(d)	 	“Tariff Base” has the meaning given to it in, and will be calculated
in accordance with, the Fees Rules.

	6.	 	In application of the above formulae, A, B, C and D will be included in the formulae
as percentages (i.e. 5 per cent. will be included in the formula as 5 and not as 0.05). A
negative result obtained by subtracting D from B shall be taken as zero. The resulting
figures shall be rounded to four decimal places.
	 
	7.	 	If requested by the Agent, each Reference Bank shall, as soon as practicable after
publication by the Financial Services Authority, supply to the Agent, the rate of charge
payable by that Reference Bank to the Financial Services Authority pursuant to the Fees
Rules in respect of the relevant financial year of the Financial Services Authority
(calculated for this purpose by that Reference Bank as being the average of the Fee
Tariffs applicable to that Reference Bank for that financial year) and expressed in pounds
per £1,000,000 of the Tariff Base of that Reference Bank.
	 
	8.	 	Each Lender shall supply any information required by the Agent for the purpose of
calculating its Additional Cost Rate. In particular, but without limitation, each Lender
shall supply the following information on or prior to the date on which it becomes a
Lender:

	 	(a)	 	the jurisdiction of its Facility Office; and
	 
	 	(b)	 	any other information that the Agent may reasonably require for such
purpose.

	 	 	Each Lender shall promptly notify the Agent of any change to the information provided by it
pursuant to this paragraph.
	 
	9.	 	The percentages of each Lender for the purpose of A and C above and the rates of
charge of each Reference Bank for the purpose of E above shall be determined by the Agent
based upon the information supplied to it pursuant to paragraphs 7 and 8 above and on the
assumption that, unless a Lender notifies the Agent to the contrary, each Lender’s
obligations in relation to cash ratio deposits and Special Deposits are the same as those
of a typical bank from its jurisdiction of
incorporation with a Facility Office in the same jurisdiction as its Facility Office.

81

 

	10.	 	The Agent shall have no liability to any person if such determination results in an
Additional Cost Rate which over or under compensates any Lender and shall be entitled to
assume that the information provided by any Lender or Reference Bank pursuant to
paragraphs 3, 7 and 8 above is true and correct in all respects.
	 
	11.	 	The Agent shall distribute the additional amounts received as a result of the
Mandatory Cost to the Lenders on the basis of the Additional Cost Rate for each Lender
based on the information provided by each Lender and each Reference Bank pursuant to
paragraphs 3, 7 and 8 above.
	 
	12.	 	Any determination by the Agent pursuant to this Schedule in relation to a formula,
the Mandatory Cost, an Additional Cost Rate or any amount payable to a Lender shall, in
the absence of manifest error, be conclusive and binding on all Parties.
	 
	13.	 	The Agent may from time to time, after consultation with the Company and the Lenders,
determine and notify to all Parties any amendments which are required to be made to this
Schedule in order to comply with any change in law, regulation or any requirements from
time to time imposed by the Bank of England, the Financial Services Authority or the
European Central Bank (or, in any case, any other authority which replaces all or any of
its functions) and any such determination shall, in the absence of manifest error, be
conclusive and binding on all Parties.

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SCHEDULE 5

FORM OF TRANSFER CERTIFICATE

	 	 	 
	To:

	 	[                    ] as Agent
	 
	 	 
	From:

	 	[The Existing Lender] (the “Existing Lender”) and [The New Lender] (the “New Lender”)
	 
	 	 
	Dated:
	 	 

InterContinental Hotels Group PLC — £1,600,000,000 Facility Agreement

dated 9 November 2004 (the “Agreement”)

	1.	 	We refer to the Agreement. This is a Transfer Certificate. Terms defined in the
Agreement have the same meaning in this Transfer Certificate unless given a different
meaning in this Transfer Certificate.
	 
	2.	 	We refer to Clause 24.5 (Procedure for transfer):

	 	(a)	 	The Existing Lender and the New Lender agree to the Existing Lender
transferring to the New Lender by novation all or part of the Existing Lender’s
Commitment, rights and obligations referred to in the Schedule in accordance with
Clause 24.5 (Procedure for transfer).
	 
	 	(b)	 	The proposed Transfer Date is [                    ].
	 
	 	(c)	 	The Facility Office, administrative office (if different) and address, fax number and
attention details for notices of the New Lender for the purposes of Clause 31.2
(Addresses) are set out in the Schedule.

	3.	 	The New Lender expressly acknowledges the limitations on the Existing Lender’s
obligations set
out in paragraph (c) of Clause 24.4 (Limitation of responsibility of Existing Lenders).
	 
	4.	 	The New Lender represents that it is a Qualifying Lender.
	 
	[5.]	 	[The New Lender confirms that the person beneficially entitled to interest payable to that
Lender in respect of an advance under a Finance Document is either:

	 	(a)	 	a company resident in the United Kingdom for United Kingdom tax purposes;
	 
	 	(b)	 	a partnership each member of which is:

	 	(i)	 	a company so resident in the United Kingdom; or
	 
	 	(ii)	 	a company not so resident in the United Kingdom which carries on a
trade in the United Kingdom through a permanent establishment and which brings
into account in computing its chargeable profits (for the purposes of section
11(2) of the Taxes Act) the whole of any share of interest payable in respect of
that advance that falls to it by reason of sections 114 and 115 of the Taxes Act; or

	 	(c)	 	a company not so resident in the United Kingdom which carries on a trade in the
United Kingdom through a permanent establishment and which brings into account interest

83

 

	 	 	 	payable in respect of that advance in computing the chargeable profits (for the purposes
of section 11(2) of the Taxes Act) of that company.1

	[5/6]	 	This Transfer Certificate may be executed in any number of counterparts and this has the same
effect as if the signatures on the counterparts were on a single copy of this Transfer Certificate.
	 
	[6/7]	 	This Transfer Certificate is governed by English law.

1    Include if New Lender comes within paragraph (ii) of the definition of Qualifying Lender in Clause 13.1 (Definitions)

84

 

THE SCHEDULE

Commitment/rights and obligations to be transferred

[insert relevant details]

[Facility Office, administrative office (if different) address, fax number and attention details
for notices and account details for payments.]

	 	 	 	 	 	 	 
	[Existing Lender]

	 	 	 	 	 	[New Lender]
	 

	 	 	 	 	 	 
	By:

	 	 	 	 	 	By:

This Transfer Certificate is accepted by the Agent and the Transfer Date is confirmed as [                    ].

[Agent]

By:

85

 

SCHEDULE 6

FORM OF ACCESSION LETTER

	 	 	 
	To:

	 	[                    ] as Agent
	 
	 	 
	From:

	 	[Subsidiary]/[New Parent] and [InterContinental Hotels Group PLC/New Parent]1
	 
	 	 
	Dated:
	 	 

Dear Sirs

InterContinental Hotels Group PLC — £1,600,000,000 Facility Agreement

dated 9 November 2004 (the “Agreement”)

	1.	 	We refer to the Agreement. This is an Accession Letter. Terms defined in the
Agreement have the same meaning in this Accession Letter unless given a different meaning
in this Accession Letter.
	 
	2.	 	[Subsidiary/New Parent] agrees to become an Additional [Borrower]/[Guarantor] and to
be bound by the terms of the Agreement as an Additional [Borrower]/[Guarantor] pursuant to
[Clause 25.2 (Additional Borrowers)]/[Clause 25.4 (Additional Guarantors)] of the
Agreement [with effect from the New Parent Scheme Date as notified to you]2.
[Subsidiary/New Parent] is a company duly incorporated under the laws of [name of relevant
jurisdiction].
	 
	3.	 	[Subsidiary’s] administrative details are as follows:
	 
	 	 	Address:
	 
	 	 	Fax No:
	 
	 	 	Attention:
	 
	4.	 	This Accession Letter is governed by English law.
	 
	 	 	[This Guarantor Accession Letter is entered into by deed.]

	 	 	 	 	 
	 
	 	[InterContinental Hotels Group PLC/New Parent]3

	 	[Subsidiary]
	 	 	 
	 	 
	 	 	By:

	 	By:

	1	 	Refer to InterContinental Hotel Group PLC before the New Parent Scheme Date and the
New Parent after the New Parent Scheme Date.
	 
	2	 	For accession of New Parent only.
	 
	3	 	Refer to InterContinental Hotel Group PLC before the New Parent Scheme Date and the
New Parent after the New Parent Scheme Date.

86

 

SCHEDULE 7

FORM OF RESIGNATION LETTER

	 	 	 
	To:

	 	[                    ] as Agent
	 
	 	 
	From:

	 	[resigning Obligor] and [InterContinental Hotels Group PLC/New Parent]1
	 
	 	 
	Dated:
	 	 

Dear Sirs

InterContinental Hotels Group PLC — £1,600,000,000 Facility Agreement

dated 9 November 2004 (the “Agreement”)

	1.	 	We refer to the Agreement. This is a Resignation Letter. Terms defined in the
Agreement have the same meaning in this Resignation Letter unless given a different
meaning in this Resignation Letter.
	 
	2.	 	Pursuant to [Clause 25.3 (Resignation of a Borrower)]/[Clause 25.6 (Resignation of a
Guarantor)], we request that [resigning Obligor] be released from its obligations as a
[Borrower]/[Guarantor] under the Agreement.
	 
	3.	 	We confirm that:

	 	(a)	 	no Default is continuing or would result from the acceptance of this
request; and
	 
	 	(b)	 	the provisions of [Clause 25.3 (Resignation of a Borrower]/[Clause
25.6 (Resignation of a Guarantor)] are otherwise complied with.

	4.	 	This Resignation Letter is governed by English law.

	 	 	 	 	 
	 
	 	[InterContinental Hotels Group PLC/New Parent]2

	 	[Subsidiary]
	 
	 	 	By:

	 	By:

 

 

 

 

	1	 	Refer to InterContinental Hotel Group PLC before the New Parent Scheme Date and the
New Parent after the New Parent Scheme Date.
	 
	2	 	Refer to InterContinental Hotel Group PLC before the New Parent Scheme Date and the
New Parent after the New Parent Scheme Date.

87

 

SCHEDULE 8

FORM OF COMPLIANCE CERTIFICATE

	 	 	 
	To:

	 	[                    ] as Agent
	 
	 	 
	From:

	 	[InterContinental Hotels Group PLC/New Parent]1
	 
	 	 
	Dated:
	 	 

Dear Sirs

InterContinental Hotels Group PLC — £1,600,000,000 Facility Agreement

dated 9 November 2004 (the “Agreement”)

	1.	 	We refer to the Agreement. This is a Compliance Certificate. Terms defined in the
Agreement have the same meaning when used in this Compliance Certificate unless given a
different meaning in this Compliance Certificate.
	 
	2.	 	We confirm that:

	 	(a)	 	the ratio of EBITDA to Net Interest Payable for the Relevant Period ending [                    ] was [                    ]:1; and

	 
	 	(b)	 	the ratio of Net Borrowings, as at the last day of the Relevant Period ending [                    ], to EBITDA for
that Relevant Period was [                    ]:1.

	 	 	Computations of the above (in reasonable detail) are attached to this Compliance Certificate.
	 
	3.	 	The Material Subsidiaries as at the period ending [                    ] are [                    ].
	 
	4.	 	[We confirm that no Default is continuing.]2

 

 

 

	Signed:	 	                    

	 
	 	 	Director/Authorised Signatory
	 
	 	 	of
	 
	 	 	[InterContinental Hotels Group PLC/New Parent]3

 

 

 

	1	 	Refer to InterContinental Hotels Group PLC before the New Parent Scheme Date and the
New Parent after the New Parent Scheme Date.
	 
	2	 	If this statement cannot be made, the certificate should identify any Default that is
continuing and the steps, if any, being taken to remedy it.
	 
	3	 	Refer to InterContinental Hotels Group PLC before the New Parent Scheme Date and the
New Parent after the New Parent Scheme Date.

88

 

SCHEDULE 9

SECURITY

	 	 	 	 	 	 	 
	Member of the Group	 	Counterparty	 	Maturity Date	 	Principal
	 	 	 	 	 	 	amount
	 	 	 	 	 	 	secured
	American Hotel B.V.

	 	FGH Bank N.V.
	 	12/12/2007
	 	£12,700,000
	 
	Intercontinental Hotel
Betriebsgesellschaft
m.b.H

	 	CreditAnstalt Bankverein
	 	30/06/2007
	 	£17,600,000
	 
	Hotelera El Carmen S.A.

	 	Banco Central
Hispanoamericano S.A.
	 	28/01/2010
	 	  £8,600,000
	 
	Penta Hotels München
GmbH & Co.

	 	Frankfurter

Hypothekenbank
	 	15/09/2008
	 	     £800,000
	 
	BVH
Hotelbesitzgesellschaft
mbH & Co. Verwaltungs-KG

	 	Frankfurter

Hypothekenbank
	 	30/06/2008
	 	£10,300,000
	 
	Holiday Inns B.V.

	 	The Law Debenture

Pension Trust

Corporation plc
	 	Not applicable

(Executive Top-

Up Plan)
	 	£20,000,000

89

 

SCHEDULE 10

TIMETABLES

     “D-” refers to the number of Business Days before the relevant Utilisation Date/the first day of
the relevant Interest Period.

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Loans in	 
	 	 	 	 	 	 	Loans in	 	 	Loans in US	 	 	other	 
	 	 	Loans in euro	 	 	Sterling	 	 	Dollars	 	 	currencies	 
	Request for
approval as an Optional Currency, if required (Clause 4.3	 	 	—	 	 	 	—	 	 	 	—	 	 	 	D-5	 
	(Conditions relating
to Optional Currencies))
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	10:30 a.m.	 
	 
	Agent
notifies the Lenders of the request (Clause 4.3
	 	 	—	 	 	 	—	 	 	 	—	 	 	 	D-5	 
	(Conditions relating to Optional Currencies))
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	3:00 p.m.	 
	 
	Responses by
Lenders to the request (Clause 4.3
	 	 	—	 	 	 	—	 	 	 	—	 	 	 	D-4	 
	(Conditions relating to Optional Currencies))
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	1:00 p.m.	 
	 
	Agent
notifies the Company if a currency is approved as an
	 	 	—	 	 	 	—	 	 	 	—	 	 	 	D-4	 
	Optional Currency in accordance
with Clause 4.3
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	5:00 p.m.	 
	(Conditions
relating to Optional Currencies)
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	Delivery of
a duly completed Utilisation Request (Clause 5.1
	 	 	D-3	 	 	 	D-1	 	 	 	D-3	 	 	 	D-3	 
	(Delivery of a Utilisation Request)
or a Selection Notice (Clause
10.1
	 	 	10:30 a.m.	 	 	 	10:30 a.m.	 	 	 	10:30 a.m.	 	 	 	10:30 a.m.	 
	(Selection of Interest
Periods))
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	Agent
determines (in relation to a Utilisation) the Base Currency
	 	 	D-3	 	 	 	D-1	 	 	 	D-3	 	 	 	D-3	 
	Amount of the Loan, if required
under Clause 5.4 (Lenders’
participation) and notifies the
Lenders of the Loan in
accordance with Clause 5.4

(Lenders’ participation)	 	 	11:00 a.m.	 	 	 	11:00 a.m.	 	 	 	11:00 a.m.	 	 	 	11:00 a.m.	 

90

 

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Loans in	 
	 	 	 	 	 	 	Loans in	 	 	Loans in US	 	 	other	 
	 	 	Loans in euro	 	 	Sterling	 	 	Dollars	 	 	currencies	 
	Agent
receives a notification from a Lender under Clause 6.2
	 	Quotation Day	 	 	—	 	 	Quotation Day	 	Quotation Day
	(Unavailability of a currency)
	 	 	3:00 p.m.	 	 	 	 	 	 	 	3:00 p.m.	 	 	 	3:00 p.m.	 
	 
	Agent gives
notice in accordance with Clause 6.2
	 	Quotation Day	 	 	—	 	 	Quotation Day	 	Quotation Day
	(Unavailability of a currency)
	 	 	5:00 p.m.	 	 	 	 	 	 	 	5:00 p.m.	 	 	 	5:00 p.m.	 
	 
	Agent
determines amount of the Term Loan in Optional Currency
	 	 	D-3	 	 	 	—	 	 	 	D-3	 	 	 	D-3	 
	in accordance with Clause 6.3

(Change of currency)	 	 	11:00 a.m.	 	 	 	 	 	 	 	11:00 a.m.	 	 	 	11:00 a.m.	 
	 
	Agent
determines amount of the Term Loan in Optional Currency
	 	 	D-3	 	 	 	—	 	 	 	D-3	 	 	 	D-3	 
	in accordance with Clause 6.4(a)

(Same Optional Currency during
successive Interest Periods)	 	 	11:00 a.m.	 	 	 	 	 	 	 	11:00 a.m.	 	 	 	11:00 a.m.	 
	 
	Agent
determines amount of Term Loan in Optional Currency
	 	 	D-3	 	 	 	—	 	 	 	D-3	 	 	 	D-3	 
	converted into Base Currency in
accordance with Clause 6.4 (b)
	 	 	11:00 a.m.	 	 	 	 	 	 	 	11:00 a.m.	 	 	 	11:00 a.m.	 
	(Same Optional Currency during
successive Interest Periods)	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	LIBOR or EURIBOR is fixed
	 	Quotation Day	 	Quotation Day	 	Quotation Day	 	Quotation Day
	 
	 	as of	 	as of	 	as of	 	as of
	 
	 	 	11:00 a.m.	 	 	 	11:00 a.m	 	 	 	11:00 a.m	 	 	 	11:00 a.m	 
	 
	 	Brussels time	 	 	 	 	 	 	 	 	 	 	 	 

91

 

SCHEDULE 11

FORM OF LMA CONFIDENTIALITY UNDERTAKING

 

LMA CONFIDENTIALITY LETTER (SELLER)

[Letterhead of Seller/Seller’s agent/broker]

To:

	 	 	 	 	 
	 	 	 	 	 
	 	 

	 	 	[insert name of Potential Purchaser/Purchaser’s agent/broker
	 	 
	 	 	 
	 	 
	 	 	 
	 	 
	 	 	 
	 	 	 	 	 
	 	 
	 	 	 

Re: The Agreement

	 	 	 	 	 
	 	 	 	 	 
	 	Company:

	 	 	 
	 	 
	 	 	 
	 	Date:
	 	 	 
	 	 
	 	 	 
	 	Amount:
	 	 	 
	 	 
	 	 	 
	 	Agent:
	 	 	 
	 	 	 	 	 
	 	 
	 	 	 

Dear Sirs

We understand that you are considering [acquiring]1/[arranging the acquisition
of]2 an interest in the Agreement (the “Acquisition”). In consideration of us agreeing
to make available to you certain information, by your signature of a copy of this letter you agree
as follows:

	1.	 	Confidentiality Undertaking
	 
	 	 	You undertake (a) to keep the Confidential Information confidential and not to
disclose it to anyone except as provided for by paragraph 2 below and to ensure that the
Confidential Information is protected with security measures and a degree of care that
would apply to your own confidential information, (b) to use the Confidential Information
only for the Permitted Purpose, (c) to use all reasonable endeavours to ensure that any
person to whom you pass any Confidential Information (unless disclosed under paragraph
2[(c)/(d)]3 below) acknowledges and complies with the provisions of this letter
as if that person were also a party to it, and (d) not to make enquiries of any member of
the Group or any of their officers, directors, employees or professional advisers relating
directly or indirectly to the Acquisition.
	 
	2.	 	Permitted Disclosure
	 
	 	 	We agree that you may disclose Confidential Information:

	 	(a)	 	to members of the Purchaser Group and their officers, directors,
employees and professional advisers to the extent necessary for the Permitted
Purpose and to any auditors of members of the Purchaser Group;

92

 

	 	(b)	 	subject to the requirements of the Agreement, in accordance with the Permitted
Purpose so long as any prospective purchaser has delivered a letter to you in equivalent
form to this letter;]
	 
	 	[(b/c)]3	 	subject to the requirements of the Agreement, to any person to (or through) whom you
assign or transfer (or may potentially assign or transfer) all or any of the rights, benefits
and obligations which you may acquire under the Agreement or with (or through) whom
you enter into (or may potentially enter into) any sub-participation in relation to, or any
other transaction under which payments are to be made by reference to, the Agreement
or the Borrower or any member of the Group so long as that person has delivered a
letter to you in equivalent form to this letter; and
	 
	 	[(c/d)]3	 	(i) where requested or required by any court of competent jurisdiction or any competent
judicial, governmental, supervisory or regulatory body, (ii) where required by the rules of
any stock exchange on which the shares or other securities of any member of the
Purchaser Group are listed or (iii) where required by the laws or regulations of any
country with jurisdiction over the affairs of any member of the Purchaser Group.

	3.	 	Notification of Required or Unauthorised Disclosure
	 
	 	 	You agree (to the extent permitted by law) to inform us of the full circumstances of
any disclosure under paragraph 2[(c)/(d)]3 or upon becoming aware that
Confidential Information has been disclosed in breach of this letter.
	 
	4.	 	Return of Copies
	 
	 	 	If we so request in writing, you shall return all Confidential Information supplied to
you by us and destroy or permanently erase all copies of Confidential Information made by
you and use all reasonable endeavours to ensure that anyone to whom you have supplied any
Confidential Information destroys or permanently erases such Confidential Information and
any copies made by them, in each case save to the extent that you or the recipients are
required to retain any such
Confidential Information by any applicable law, rule or regulation or by any competent
judicial, governmental, supervisory or regulatory body or in accordance with internal
policy, or where the Confidential Information has been disclosed under paragraph
2[(c)/(d)]3 above.
	 
	5.	 	Continuing Obligations
	 
	 	 	The obligations in this letter are continuing and, in particular, shall survive the
termination of any discussions or negotiations between you and us. Notwithstanding the
previous sentence, the obligations in this letter shall cease (a) if you become a party to
or otherwise acquire (by assignment or sub-participation) an interest, direct or indirect,
in the Agreement or (b) twelve months after you have returned all Confidential Information
supplied to you by us and destroyed or permanently erased all copies of Confidential
Information made by you (other than any such Confidential Information or copies which have
been disclosed under paragraph 2 above (other than sub-paragraph 2(a)) or which, pursuant
to paragraph 4 above, are not required to be returned or destroyed).

93

 

	6.	 	No Representation; Consequences of Breach, etc
	 
	 	 	You acknowledge and agree that:

	 	(a)	 	neither we, [nor our principal]4 nor any member of the
Group nor any of our or their respective officers, employees or advisers (each a
“Relevant Person”) (i) make any representation or warranty, express or implied, as
to, or assume any responsibility for, the accuracy, reliability or completeness of
any of the Confidential Information or any other information supplied by us or the
assumptions on which it is based or (ii) shall be under any obligation to update
or correct any inaccuracy in the Confidential Information or any other information
supplied by us or be otherwise liable to you or any other person in respect to the
Confidential Information or any such information; and
	 
	 	(b)	 	we [or our principal]4 or members of the Group may be
irreparably harmed by the breach of the terms hereof and damages may not be an
adequate remedy; each Relevant Person may be granted an injunction or specific
performance for any threatened or actual breach of the provisions of this letter
by you.

	7.	 	No Waiver; Amendments, etc
	 
	 	 	This letter sets out the full extent of your obligations of confidentiality owed to us
in relation to the information the subject of this letter. No failure or delay in
exercising any right, power or privilege hereunder will operate as a waiver thereof nor
will any single or partial exercise of any right, power or privilege preclude any further
exercise thereof or the exercise of any other right, power or privileges hereunder. The
terms of this letter and your obligations hereunder may only be amended or modified by
written agreement between us and the Company.
	 
	8.	 	Inside Information
	 
	 	 	You acknowledge that some or all of the Confidential Information is or may be
price-sensitive information and that the use of such information may be regulated or
prohibited by applicable legislation relating to insider dealing and you undertake not to
use any Confidential Information for any unlawful purpose.
	 
	9.	 	Nature of Undertakings
	 
	 	 	The undertakings given by you under this letter are given to us and (without implying
any fiduciary obligations on our part) are also given for the benefit of [our
principal,]4 the Company and each other member of the Group.
	 
	10.	 	[Third Party Rights]

	(a)	 	Subject to paragraph 6 and to paragraph 9 the terms of this letter may be enforced and
relied upon only by you and us and the operation of the Contracts (Rights of Third
Parties) Act 1999 is excluded.

94

 

	(b)	 	Notwithstanding any provisions of this letter, the parties to this letter do not
require the consent of any Relevant Person (except for the Company) or any member of the
Group to rescind or vary this letter at any time.

	11.	 	Governing Law and Jurisdiction
	 
	 	 	This letter (including the agreement constituted by your acknowledgement of its terms)
shall be governed by and construed in accordance with the laws of England and the parties
submit to the non-exclusive jurisdiction of the English courts.
	 
	12.	 	Definitions
	 
	 	 	In this letter (including the acknowledgement set out below) terms defined in the
Agreement shall, unless the context otherwise requires, have the same meaning and:
	 
	 	 	“Confidential Information” means any information relating to the Company, any member of the
Group, the Agreement and/or the Acquisition provided to you by us or any of our affiliates
or advisers, in whatever form, and includes information given orally and any document,
electronic file or any other way of representing or recording information which contains or
is derived or copied from such information but excludes information that (a) is or becomes
public knowledge other than as a direct or indirect result of any breach of this letter or
(b) is known by you before the date the information is disclosed to you by us or any of our
affiliates or advisers or is lawfully obtained by you thereafter, other than from a source
which is connected with the Group and which, in either case, as far as you are aware, has
not been obtained in violation of, and is not otherwise subject to, any obligation of
confidentiality;
	 
	 	 	“Group” means the Company and each of its holding companies and
subsidiaries and each subsidiary of each of its holding companies (as each such term is
defined in the Companies Act 1985);
	 
	 	 	“Permitted Purpose” means [subject to the terms of this
letter, passing on information to a prospective purchaser for the purpose of]2
considering and evaluating whether to enter into the Acquisition; and
	 
	 	 	“Purchaser Group” means you, each of your holding companies and subsidiaries and each subsidiary of
each of your holding companies (as each such term is defined in the Companies Act 1985).

Please acknowledge your
agreement to the above by signing and returning the enclosed copy.

Yours faithfully

For and on behalf of

[Seller/Seller’s agent/broker]

	To:	 	[Seller]
	 
	 	 	[Seller’s agent/broker]

95

 

     The Borrower and each other member of the Group

We acknowledge and agree to the above:

For and on behalf of

[Potential Purchaser/Purchaser’s agent/broker]

	1	 	delete if addressee is acting as broker or agent.
	 
	2	 	delete if addressee is acting as principal.
	 
	3	 	delete as applicable.
	 
	4	 	delete if letter is sent out by the Seller rather than the Seller’s broker or agent.

96

 

SCHEDULE 12

FORM OF TERM OUT NOTICE

	 	 	 
	From:

	 	[InterContinental Hotels Group PLC/New Parent]1
	 
	 	 
	To:

	 	[Agent]
	 
	 	 
	Dated:
	 	 

Dear Sirs

InterContinental Hotels Group PLC — £1,600,000,000 Facility Agreement

dated 9 November 2004 (the “Agreement”)

	1.	 	We refer to the Agreement. This is a Term Out Notice. Terms defined in the Agreement
have the same meaning in this Term Out Notice unless given a different meaning in this
Term Out Notice.
	 
	2.	 	We elect to exercise the Term Out Option pursuant to Clause 7.3 (Term Out Option) of
the Agreement in relation to [all Facility B Loans/the following Facility B Loans[s]]:

	 	 	 	 	 
	 

	 	Amount:
	 	[                    ]
	

	 	 	 	 
	

	 	Currency:
	 	[                    ]
	

	 	 	 	 
	

	 	Interest Period:
	 	[                    ].

	3.	 	This Term Out Notice is irrevocable.

Yours faithfully

 

 

 

authorised signatory for

[InterContinental Hotels Group PLC/New Parent]2

	1	 	Refer to InterContinental Hotels Group PLC before the New Parent Scheme Date and the
New Parent after the New Parent Scheme Date.
	 
	2	 	Refer to InterContinental Hotels Group PLC before the New Parent Scheme Date and the
New Parent after the New Parent Scheme Date.

97

 

SCHEDULE 13

FORM OF MARGIN CERTIFICATE

	 	 	 
	To:

	 	[                     ] as Agent
	 
	 	 
	From:

	 	InterContinental Hotels Group PLC/New Parent1
	 
	 	 
	Dated:
	 	 

Dear Sirs

InterContinental Hotels Group PLC — £1,600,000,000 Facility Agreement

dated 9 November 2004 (the “Agreement”)

	1.	 	We refer to the Agreement. This is a Margin Certificate. Terms defined in the
Agreement have the same meaning when used in this Margin Certificate unless given a
different meaning in this Margin Certificate.
	 
	2.	 	We confirm that the ratio of Net Borrowings, as at the last day of the last preceding
Margin Period, to EBITDA for that Margin Period was [higher than 2.75:1]/[in the range of [                    ]: 1
to [                    ]:1]/[equal to or lower than 1:25:1].2

Computations of the above (in reasonable detail) are attached to this Margin Certificate.

	Signed:	 	                                        
	 
	 	 	Director
	 
	 	 	of
	 
	 	 	[InterContinental Hotels Group PLC/New Parent]3

	1	 	Refer to InterContinental Hotels Group PLC before the New Parent Scheme Date and the
New Parent after the New Parent Scheme Date.
	 
	2	 	Delete as appropriate.
	 
	3	 	Refer to InterContinental Hotels Group PLC before the New Parent Scheme Date and the
New Parent after the New Parent Scheme Date.

98

 

The Company

INTERCONTINENTAL HOTELS GROUP PLC

	 	 	 
	Address:

	 	67 Alma Road
	

	 	Windsor
	

	 	Berkshire SL4 3HD
	 
	 	 
	Fax No:

	 	01753 410101
	 
	 	 
	Attention:

	 	The Company Secretary
	 
	 	 
	cc:

	 	Treasurer
	

	 	InterContinental Hotels Group PLC
	

	 	No 1 First Avenue
	

	 	Centrum 100
	

	 	Burton on Trent
	

	 	Staffordshire DE14 2WB
	 
	 	 
	Fax No:

	 	01283 514767
	 
	 	 
	By:
	 	 

The Original Borrowers

INTERCONTINENTAL HOTELS GROUP PLC

	 	 	 
	Address:

	 	67 Alma Road
	

	 	Windsor
	

	 	Berkshire SL4 3HD
	 
	 	 
	Fax No:

	 	01753 410101
	 
	 	 
	Attention:

	 	The Company Secretary
	 
	 	 
	cc:

	 	Treasurer
	

	 	InterContinental Hotels Group PLC
	

	 	No 1 First Avenue
	

	 	Centrum 100
	

	 	Burton on Trent
	

	 	Staffordshire DE14 2WB
	 
	 	 
	Fax No:

	 	01283 514767
	 
	 	 
	By:
	 	 

99

 

SIX CONTINENTS PLC

	 	 	 
	Address:

	 	67 Alma Road
	

	 	Windsor
	

	 	Berkshire SL4 3HD
	 
	 	 
	Fax No:

	 	01753 410101
	 
	 	 
	Attention:

	 	The Company Secretary
	 
	 	 
	cc:

	 	Treasurer
	

	 	InterContinental Hotels Group PLC
	

	 	No 1 First Avenue
	

	 	Centrum 100
	

	 	Burton on Trent
	

	 	Staffordshire DE14 2WB
	 
	 	 
	Fax No:

	 	01283 514767
	 
	 	 
	By:
	 	 

 

The Original Guarantors

INTERCONTINENTAL HOTELS GROUP PLC

By:

 

SIX CONTINENTS PLC

By:

100

 

The Arranger

THE BANK OF TOKYO-MITSUBISHI, LTD.

By:

 

BARCLAYS CAPITAL

By:

 

CITIGROUP GLOBAL MARKETS LIMITED

By:

 

HSBC BANK plc

By:

 

J.P. MORGAN plc

By:

 

LLOYDS TSB BANK plc

By:

 

SG CORPORATE & INVESTMENT BANKING

By:

 

THE ROYAL BANK OF SCOTLAND plc

By:

 

WESTLB AG, LONDON BRANCH

By:

 

101

 

The Original Lenders

THE BANK OF TOKYO-MITSUBISHI, LTD.

By:

 

BARCLAYS BANK PLC

By:

 

CITIBANK, N.A.

By:

 

HSBC BANK plc

By:

 

JPMORGAN CHASE BANK

By:

 

LLOYDS TSB BANK PLC

By:

 

SOCIÉTÉ GÉNÉRALE

By:

 

THE ROYAL BANK OF SCOTLAND plc

By:

 

WESTLB AG, LONDON BRANCH

By:

102

 

The Agent

HSBC BANK plc

	 	 	 
	Address:

	 	8 Canada Square

Level 24

London

E14 5HQ
	 
	 	 
	Fax No:

	 	020 7991 4348
	 
	 	 
	Attention:

	 	CORPORATE TRUST AND LOAN AGENCY
	 
	 	 
	By:
	 	 

103exv4w21

 

Exhibit 4 (b)(i)

PURCHASE AND SALE AGREEMENT

     THIS PURCHASE AND SALE AGREEMENT is made as of July 1, 2003, by and between INTERCONTINENTAL
HOTELS GROUP RESOURCES, INC., a Delaware corporation (the “Seller”) and HPT IHG PROPERTIES TRUST, a
Maryland real estate investment trust (together with its permitted successors and assigns,
the “Purchaser”).

W I T N E S S E T H :

     WHEREAS, the Seller is the owner of the Properties identified on Exhibit
A; and

     WHEREAS, the Purchaser desires to purchase all of the Properties from the Seller and the
Seller wishes to sell all of the Properties to the Purchaser, subject to and upon the terms and
conditions hereinafter set forth;

     NOW, THEREFORE, in consideration of the mutual covenants herein contained and other good and
valuable consideration, the mutual receipt and legal sufficiency of which are hereby acknowledged,
the Seller and the Purchaser hereby agree as follows:

     SECTION 1 DEFINITIONS.

     Capitalized terms used in this Agreement and not otherwise defined herein shall have the
meanings set forth below, in the Section of this Agreement referred to below, or in such other
document or agreement referred to below:

     1.1
“Agreement” shall mean this Purchase and Sale
Agreement, together with Exhibits A — I and Schedules 6.1(d), 6.1(f) — (i), 6.1(k), 6.1(m) — 6.1(o), 6.1(r) and 6.1(t)
attached hereto, as it and they may be amended from time to
time.

     1.2
“Apportionment Time” shall have the meaning given such
term in Section 9.1 of this Agreement.

     1.3
“Assets” shall mean, with respect to any Property,
collectively, all of the Real Property, the FF&E, the FAS, the
Contracts, the Improvements, the Inventories and the Intangible
Property now owned or hereafter acquired by the Seller in
connection with or relating to such Property other than any
Excluded Assets with respect to such Property.

-1-

 

     1.4
“Business Day” shall mean any day other than a Saturday, Sunday or any other day
on which banking institutions in the Commonwealth of Massachusetts or the State of Georgia are
authorized by law or executive action to close.

     1.5 “Closing” shall mean the consummation of the purchase and sale transactions
contemplated by this Agreement.

     1.6 “Closing Date” shall mean the date on which the

     Closing shall occur.

     1.7 “Contracts” shall mean, with respect to any Property, all hotel licensing
agreements and other service contracts, equipment leases, booking agreements and other arrangements
or agreements to which the Seller is a party affecting the ownership, repair, maintenance, leasing
or operation of such Property, to the extent the Seller’s interest therein is assignable or
transferable; provided, however, that the term “Contracts” shall not include any
management agreements or any Excluded Assets.

     1.8 “Diligence Expiration Date” shall mean July 1, 2003.

     1.9 “Excluded Assets” shall mean, with respect to any Property:

     (a) any right, title or interest in the name “Staybridge, ” “Intercontinental” and other
System Marks (as defined in the Management Agreement);

     (b) all licenses and permits necessary for Manager to manage the Properties pursuant to the
Management Agreement;

     (c) all computer software licensed for use by Seller or affiliates of Seller, including
accounts receivable software;

     (d) any and all motor vehicles;

     (e) any and all menus, stationery, or other items
indicating that the Properties are owned by Seller;

     (f) any and all personal property of the employees of the
Properties;

     (g) books, ledger sheets, files and records with respect
to the operation of the Properties; and

     (h) all contracts relating to such Property or its operations, other then the Contracts and
the Permitted Encumbrances;

-2-

 

     (i) alcoholic beverages inventories; and

     (j) leased two way radios.

     1.10 “FAS” shall mean all items included within “Property
and Equipment” under the Uniform System of Accounts, including,
but not limited to, linen, china, glassware, tableware, uniforms
and similar items, whether used in connection with public space
or guest rooms, other than Excluded Assets.

     1.11 “FF&E” shall mean, with respect to any Property, all
appliances, machinery, devices, fixtures, appurtenances,
equipment, furniture, furnishings and articles of tangible
personal property of every kind and nature whatsoever located in
or at, or used in connection with the ownership, operation or
maintenance of, such Property, but in any event excluding any
Excluded Assets.

     1.12 “Hotel” shall mean, with respect to any Property, the
Staybridge Suites hotel located on such Property.

     1.13 “HPT” shall mean Hospitality Properties Trust, a
Maryland real estate investment trust.

     1.14 “HPT Guaranty” shall mean the Guaranty Agreement
substantially in the form attached hereto as Exhibit C to be
made by HPT at the Closing for the benefit of IHG and the
Seller, as the same may be amended, restated, supplemented or
otherwise modified from time to time.

     1.15 “HPT Parties” shall mean, collectively, HPT, the
Purchaser and the Tenant.

     1.16 “IHG” shall mean Intercontinental Hotels Group PLC, a
United Kingdom corporation.

     1.17 “IHG Guaranty” shall mean the Guaranty Agreement
substantially in the form attached hereto as Exhibit D, to be
made by IHG at the Closing for the benefit of the Tenant and
HPT, as the same may be amended, restated, supplemented or
otherwise modified from time to time.

     1.18 “Improvements” shall mean, with respect to any
Property, all buildings, fixtures, walls, fences, landscaping
and other structures and improvements situated on, affixed or
appurtenant to, the Real Property with respect to such Property.

     1.19 “Intangible Property” shall mean, with respect to any Property, all transferable
or assignable permits, certificates

-3-

 

of occupancy, operating permits, sign permits, development
rights and approvals, certificates, licenses, warranties and guarantees, the Contracts, telephone
exchange numbers identified with such Property held by the Seller and all other transferable
intangible property, miscellaneous rights, benefits and privileges of any kind or character with
respect to such Property held by the Seller other than Excluded Assets.

     1.20
“Inventories” shall mean, with respect to any
Property, all “Inventories” as defined in the Uniform System of
Accounts other than Excluded Assets.

     1.21
“Lease” shall mean the Lease Agreement substantially
in the form attached hereto as Exhibit E, to be entered into by
the Purchaser and the Tenant at the Closing, as the same may be
amended, restated, supplemented or otherwise modified from time
to time.

     1.22
“Management Agreement” shall mean the Management
Agreement substantially in the form attached hereto as
Exhibit F, to be entered into by the Tenant and the Seller at
the Closing, as the same may be amended, restated, supplemented
or otherwise modified from time to time.

     1.23
“Operating Costs” shall have the meaning given to such
term in the Management Agreement.

     1.24
“Permitted Encumbrances” shall mean, with respect to
any Property, (a) liens for taxes, assessments and governmental
charges with respect to such Property not yet due and payable or
due and payable but not yet delinquent; (b) applicable zoning
regulations and ordinances and other governmental laws,
ordinances and regulations provided the same do not prohibit or
impair in any material respect the use of such Property as a
Staybridge Suite hotel, as contemplated by this Agreement, the
Management Agreement and the Lease; (c) such other nonmonetary
encumbrances as do not, in the Purchaser’s reasonable opinion,
impair marketability and do not prohibit or impair in any
material respect the use of such Property as a fully functioning
Staybridge Suite hotel as contemplated by this Agreement, the
Lease, and the Management Agreement; and (d) such other
nonmonetary encumbrances with respect to such Property which are
not objected to by the Purchaser in accordance with
Sections 2 .4 and 2.5.

     1.25
“Properties” shall mean, collectively, all of the
Assets relating to the properties identified on Exhibit A, the
legal descriptions of which are set forth in Exhibits B-1
through B-16.

-4-

 

     1.26
“Property” shall mean any one of the Properties.

     1.27
“Purchase Price” shall mean One Hundred Eighty Five
Million Dollars ($185,000,000). The Purchase Price shall be
allocated among the Properties as set forth in Exhibit A.

     1.28
“Purchaser” shall have the meaning given such term in
the preamble to this Agreement.

     1.29
“Real Property” shall mean, with respect to any
Property, the real property described in the applicable Exhibits
B-1 through B-16, together with all easements, rights of way,
privileges, licenses and appurtenances which the Seller may now own or hereafter acquire with
respect thereto.

     1.30
“Seller” shall have the meaning given such term in the
preamble to this Agreement.

     1.31
“Seller’s Knowledge” shall mean the actual (and not
the imputed, or constructive) knowledge of Michael L. Goodson,
Senior Vice President, Finance and Business Development, of IHG
and Robert C. Gunkel, Vice President, Asset Management and
Project Finance, of IHG (collectively, the “Designated
Representatives”) after due inquiry of each general manager
of
the Hotels and other appropriate personnel employed by the
Seller or its Affiliates; provided, however, the Designated
Representatives shall not be obligated to make inquiry of any
personnel employed at a Hotel other than the general manager
thereof.

     1.32
“Surveys” shall have the meaning given such term in
Section 2.5.

     1.33
“Tenant” shall mean HPT TRS IHG-1, Inc., a Maryland
corporation.

     1.34
“Title Commitments” shall have the meaning given such
term in Section 2.4.

     1.35
“Title Company” shall mean Lawyers Title Insurance
Corporation or such other title insurance company as shall have
been approved by the Purchaser and the Seller.

     1.36
“Transaction Documents” shall mean, collectively, this
Agreement, the Management Agreement, the Lease, the HPT Guaranty
and the IHG Guaranty.

     1.37
“True-up” shall have the meaning ascribed thereto in
Section 9.1.

-5-

 

     1.38
“Uniform System of Accounts” shall mean A Uniform System of Accounts for Hotels,
Ninth Revised Edition, 1996, as published by the Hotel Association of New York City, as the same
may be further revised from time to time.

     SECTION
2 PURCHASE AND SALE; DILIGENCE.

     2.1 Purchase and Sale. In consideration of the mutual
covenants herein contained, the Purchaser hereby agrees to
purchase from the Seller, and the Seller hereby agrees to sell
to the Purchaser, all of the Seller’s right, title and interest
in and to the Properties for the Purchase Price subject to and
in accordance with the terms and conditions of this Agreement.

     2.2 Diligence Inspections. At all times prior to the
Closing, the Seller shall permit the Purchaser and its
representatives to inspect the Properties and the Improvements
(including, without limitation, all roofs, electric, mechanical and structural elements, and HVAC
systems therein) and to perform due diligence, soil analysis and environmental investigations, to
examine the books of account and records of the Seller with respect to the Properties, including,
without limitation, all leases and agreements affecting the Properties, and make copies thereof, at
such reasonable times as the Purchaser or its representatives may request by reasonable prior
notice to the Seller (which notice may be oral). At all such times, the Purchaser and its
representatives shall not unreasonably disrupt or interfere with the ongoing operation of the
Properties or any of the guests at the Hotels. To the extent that, in connection with such
investigations, the Purchaser or its agents, representatives or contractors, damages or disturbs
any of the Assets, the Purchaser shall return the same to substantially the same condition which
existed immediately prior to such damage or disturbance to the extent so damaged by Purchaser or
its agents. The Purchaser shall indemnify, defend and hold harmless the Seller from and against
any and all liabilities, claims, demands, expenses, losses, costs or damages (including, without
limitation, reasonable attorneys’ fees) which the Seller may incur to the extent resulting from any
act or omission of the Purchaser or its representatives, agents or contractors in connection with
such examinations and inspections. The foregoing indemnity shall survive the Closing and the
termination of this Agreement.

     2.3 Option to Terminate. If the results of the
inspections performed by or on behalf of the Purchaser pursuant
to Section 2.2 shall be unsatisfactory to the Purchaser in any
respect or if the Purchaser otherwise determines not to proceed
to Closing, the Purchaser shall have the right to terminate this

-6-

 

Agreement at any time prior
to the Diligence Expiration Date, by the giving of notice thereof to the Seller on or before the
Diligence Expiration Date.

     2.4 Title Matters.

     (a) Prior to the date hereof, the Seller and the Purchaser
have ordered from the Title Company and directed the Title
Company promptly to deliver to the Purchaser and the Seller a
preliminary title commitment for an ALTA extended owner’s policy
of title insurance with respect to each of the Properties,
together with complete and legible copies of all instruments and
documents referred to as exceptions to title (collectively, the
“Title Commitments”).

     (b) On or before the Diligence Expiration Date, the
Purchaser shall give the Seller notice of any title exceptions
(other than Permitted Encumbrances) which adversely affect such
Property in any material respect and as to which the Purchaser
reasonably objects. If, for any reason, the Seller is unable or
unwilling to take such actions as may be required to cause such
exceptions to be removed from the Title Commitments, the Seller
shall give the Purchaser notice thereof; it being understood and
agreed that the failure of the Seller to give such notice within
five (5) days after Purchaser gives its notice of objection
shall be deemed an election by the Seller not to remedy such
matters. If the Seller shall be unwilling or unable to remove
any title defects to which the Purchaser has reasonably
objected, the Purchaser may elect (i) to terminate this
Agreement, or (ii) to consummate the transactions contemplated
hereby, notwithstanding such title defect, without any abatement
or reduction in the Purchase Price on account thereof. The
Purchaser shall make any such election by notice to the Seller
given on or prior to the Closing Date. Failure of the Purchaser
to give such notice shall be deemed an election by the Purchaser
to proceed in accordance with clause (ii) above. Except as
otherwise expressly provided herein or agreed to in writing by
the Seller, the Seller shall be under no obligation to remove or
otherwise cure a title exception, and any failure or refusal of
Seller to do so shall not be a default of Seller hereunder.
Seller’s election to attempt to cure title exceptions shall not
create any obligation of Seller to do so. Notwithstanding the
foregoing, the Seller shall cause all mortgages and deeds of
trust as well as any other monetary liens encumbering any
Property arising by, through or under the Seller to be released
at or prior to the Closing.

-7-

 

     2.5 Survey Matters.

     (a) Prior to the date hereof, the Purchaser has arranged
for the preparation of an as-built ALTA survey with respect to
each of the Properties (collectively, the “Surveys”) , by a
licensed surveyor in the jurisdiction in which each such
Property is located, which (i) contains an accurate legal
description of the applicable Property, (ii) shows the exact
location, dimension and description (including applicable
recording information) of all utilities, easements,
encroachments and other physical matters affecting such
Property, the number of striped parking spaces located thereon
and all applicable building set-back lines, (iii) states whether
the applicable Property is located within a 100-year flood
plain, and (iv) includes a certification substantially in the
form set forth in Exhibit G, for the benefit of the parties
identified therein.

     (b) On or before the Diligence Expiration Date, the
Purchaser shall give the Seller notice of any matters shown on
such Survey (other than Permitted Encumbrances) which adversely
affect any such Property in any material respect and as to which
the Purchaser reasonably objects. If, for any reason, the
Seller is unable or unwilling to take such actions as may be
required to remedy the objectionable matters, the Seller shall
give the Purchaser prompt notice thereof; it being understood
and agreed that the failure of the Seller to give such notice
within five (5) days after Purchaser gives its notice of
objection shall be deemed an election by the Seller not to
remedy such matters. If the Seller shall be unable or unwilling
to remove any survey defect to which the Purchaser has
reasonably objected, the Purchaser may elect (i) to terminate
this Agreement, or (ii) to consummate the transactions
contemplated hereby, notwithstanding such defect, without any
abatement or reduction in the Purchase Price of the affected
Property on account thereof. The Purchaser shall make any such
election by notice to the Seller given on or prior to the
Closing. Failure of the Purchaser to give such notice shall be
deemed an election by the Purchaser to proceed in accordance
with clause (ii) above.

     SECTION 3 PURCHASE AND SALE.

     3.1 Closing. The Closing shall be held at the offices of Sullivan & Worcester LLP,
One Post Office Square, Boston, Massachusetts, or at such other location as the Seller and the
Purchaser may agree, on July 1, 2003 or on such other date as the Seller and the Purchaser may
agree.

-8-

 

     3.2 Purchase Price. At the Closing, the Purchase Price shall be payable by wire
transfer of immediately available funds to an account or accounts to be designated by the Seller
prior to the Closing.

     SECTION 4 CONDITIONS TO PURCHASER’S OBLIGATION TO CLOSE.

     The obligation of the Purchaser to acquire each of the Properties shall be subject to the
satisfaction or waiver of the following conditions precedent on and as of the Closing Date:

     4.1 Property Documents. The Seller shall have delivered
to the Purchaser:

     (a) With respect to each of the Properties, a good and
sufficient New York bargain and sale deed with covenants against
grantor’s acts, or its local equivalent, in proper statutory
form for recording, duly executed and acknowledged by the
Seller, conveying good and marketable title to the Real Property
portion of such Property, free from all liens and encumbrances
other than the Permitted Encumbrances;

     (b) A bill of sale and assignment agreement, in the form
attached hereto as Exhibit H, duly executed and acknowledged;

     (c) A bill of sale and assignment agreement, in the form
attached hereto as Exhibit I duly executed and acknowledged;

     (d) To the extent the same are in the Seller’s possession
or control, original, fully executed copies of all agreements
constituting Assets; and

     (e) A copy of the final duly issued certificate of
occupancy for each of the Properties.

     4.2 General Documents. The following documents shall have
been duly executed and delivered:

     (a) the IHG Guaranty, duly executed by IHG;

     (b) the Management Agreement, duly executed by the Seller;

     (c) certificates of duly authorized officers of the Seller
confirming the continued truth and accuracy of the
representations and warranties of the Seller in this Agreement;

     (d) certified copies of applicable resolutions and
certificates of incumbency with respect to each of the Seller
and IHG; and

-9-

 

     (e) such other conveyance documents, certificates, deeds, affidavits and other instruments as
the Purchaser or the Title Company may reasonably require to effectuate the transactions
contemplated by this Agreement.

     4.3
Condition of Properties, Etc.

     (a) No action shall be pending or threatened for the
condemnation or taking by power of eminent domain of all or any
material portion of the Properties; and

     (b) All
material licenses, permits and other
authorizations necessary for the current use, occupancy and
operation of the Properties shall be in full force and effect.

     4.4 Title Policies. The Title Company shall be prepared,
subject only to payment of the applicable premium and
endorsement fees and delivery of all conveyance documents in
recordable form, to issue title insurance policies to the
Purchaser with respect to each of the Properties, in form and
substance satisfactory to the Purchaser in accordance with
Section 2.4, together with such affirmative coverages as the
Purchaser may reasonably require and shall have been determined
by the Title Company as available as provided in Section 2.4.

     4.5 Opinions of Counsel.

     (a) The Purchaser shall have received one or more written
opinions from counsel to the Seller, in form and substance
reasonably satisfactory to the Purchaser, regarding the
organization and authority of the Seller and IHG and such other
persons or entities as the Purchaser may reasonably require, the
enforceability of this Agreement, the other Transaction
Documents and such other matters with respect to the
transactions contemplated by this Agreement and the other
Transaction Documents as the Purchaser may reasonably require
together with certified copies of all charter documents.

     (b) The Purchaser shall have received a zoning diligence
memorandum from local counsel to the Purchaser, in form and
substance reasonably satisfactory to the Purchaser, regarding
the compliance of the Properties located in Florida or Texas
with respect to zoning, licensing and such other matters as the
Purchaser may reasonably require.

     4.6
No Defaults. There shall be no default on the part of
any of the Seller or IHG under any of the Transaction Documents,
and there shall be no facts or circumstances which with the
passage of time, the giving of notice or both would constitute

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such a default or which would pursuant to the terms of the Transaction Documents entitle any HPT Party to terminate
any Transaction Document.

     SECTION 5 CONDITIONS TO SELLER’S OBLIGATION TO CLOSE.

     The obligation of the Seller to convey the Properties on the Closing Date to the
Purchaser is subject to the satisfaction or waiver of the following conditions precedent on
and as of the Closing Date:

     5.1 Purchase Price. The Purchaser shall deliver to the
Seller the Purchase Price as provided in Section 3.2 (subject to
the adjustments and prorations as provided in this Agreement).

     5.2 Property Documents. The Purchaser shall have delivered to the Seller duly executed and acknowledged
counterparts of the documents described in Sections 4.1(b) and 4.1(c).

     5.3 General Documents. The following documents shall have
been duly executed and delivered:

     (a) the Management Agreement, duly executed by Tenant;

     (b) the HPT Guaranty, duly executed by HPT;

     (c) certificates of duly authorized officers of the
Purchaser confirming the continued truth and accuracy of the
representations and warranties of the Purchaser in this
Agreement;

     (d) certified copies of applicable resolutions and
certificates of incumbency with respect to each of the HPT
Parties; and

     (e) such other documents, certificates, affidavits and
other instruments as the Seller or the Title Company may
reasonably require to effectuate the transactions contemplated
by this Agreement.

     5.4 Opinion of Counsel. The Seller shall have received one
or more written opinions from counsel to the HPT Parties, in
form and substance reasonably satisfactory to the Seller,
regarding the organization and authority of the HPT Parties and
such other persons or entities as the Seller may reasonably
require, the enforceability of this Agreement, the other
Transaction Documents and such other matters with respect to the
transactions contemplated by this Agreement and the other

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Transaction Documents as
the Seller may reasonably require together with certified copies of all charter documents.

     5.5 No Defaults. There shall be no default on the part of any of the HPT Parties under
any of the Transaction Documents, and there shall be no facts or circumstances which with the
passage of time, the giving of notice or both would constitute such a default or which would
pursuant to the terms of the Transaction Documents entitle the Seller to terminate any Transaction
Document.

     SECTION 6 REPRESENTATIONS AND WARRANTIES OF THE SELLER.

     6.1 Representation of Seller. To induce the Purchaser to enter into this
Agreement, the Seller covenants, represents and warrants to the Purchaser as follows:

     (a) The Seller is duly organized, validly existing and in
good standing under the laws of the jurisdiction of its
formation, and has all requisite power and authority under the
laws of such jurisdiction and its respective charter documents
to enter into and perform its obligations under the Transaction
Documents and to consummate the transactions contemplated
thereby. The Seller is duly qualified to transact business in
each jurisdiction in which the nature of the business conducted
by it requires such qualification, except where such failure to
qualify would not have a material adverse effect on the Seller
or the transactions contemplated hereby.

     (b) The Seller has taken (or will take, prior to the
Closing Date) all necessary action to authorize the execution,
delivery and performance of this Agreement and the other
Transaction Documents to which it is a party, and upon the
execution and delivery of any document to be delivered by the
Seller on or prior to the Closing Date, such document shall
constitute the valid and binding obligation and agreement of
each of the Seller that is a party thereto, enforceable against
Seller in accordance with its terms, except as enforceability
may be limited by bankruptcy, insolvency, reorganization,
moratorium or similar laws of general application affecting the
rights and remedies of creditors and general principles of
equity.

     (c) The execution, delivery or performance of the
Transaction Documents by the Seller, and the compliance with the
terms and provisions thereof, will not result in any breach of
the terms, conditions or provisions of, or conflict with or
constitute a default under, or result in the creation of any
lien, charge or encumbrance upon any Property pursuant to the

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terms of any indenture, mortgage, deed of trust, note, evidence
of indebtedness or any other agreement or instrument by which the Seller is bound.

     (d) Except
as may be set forth on Schedule 6.1 (d), to the
Seller’s Knowledge, no action or proceeding is pending or
threatened, and no investigation looking toward such an action
or proceeding has begun, which (i) questions the validity of the
Transaction Documents or any action taken or to be taken
pursuant thereto, (ii) will result in any material adverse
change in the business, operation, affairs or condition of any
of the Properties, (iii) may result in or subject any of the
Properties to a material liability, (iv) involves condemnation
or eminent domain proceedings against any material part of any
of the Properties or (v) is likely to materially and adversely
affect the ability of the Seller to perform its obligations
hereunder.

     (e) Other than (i) the Permitted Encumbrances, (ii) the
documents to be assigned to the Purchaser pursuant to the terms
hereof, true and complete copies of which have been made
available to the Purchaser and (iii) agreements and easements
with governmental bodies and utility companies which are
reasonably necessary for the development and operation of the
Properties as contemplated by this Agreement and the documents
and instruments which are contemplated to be executed and
delivered by the parties hereto and their affiliates pursuant to
the terms hereof, there are no material agreements, leases,
licenses or occupancy agreements affecting the Properties which
will be binding on the Purchaser subsequent to the Closing Date.

     (f) Except as may be set forth in Schedule 6.1(f) or in
the written inspection reports obtained by the Purchaser in
connection herewith, to the Seller’s Knowledge, there is no fact
or condition which materially and adversely affects the physical
condition of any of the Properties which has not been set forth
in this Agreement, or in the other documents, certificates or
statements furnished to or obtained by the Purchaser in
connection with the transactions contemplated hereby.

     (g) All utilities and services necessary for the use and
operation of the Properties (including, without limitation, road access, water, electricity and telephone) are available thereto,
and are of sufficient capacity to meet adequately all needs and
requirements necessary for the current use and operation of the
Properties. To the Seller’s Knowledge, except as may be set
forth in Schedule 6.1(g), no fact, condition or proceeding
exists which would result in the termination or impairment of
the furnishing of such utilities to any of the Properties.

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     (h) Except
as may be set forth in Exhibit 6.1 (h), to the Seller’s Knowledge or in
the written inspection reports obtained by Purchaser in connection therewith, (i) the Properties
and the use and operation thereof do not violate any material federal, state, municipal or other
governmental statutes, ordinances, by-laws, rules, regulations or any other legal requirements,
including, without limitation, those relating to construction, occupancy, zoning, adequacy of
parking, environmental protection, occupational health and safety or fire safety applicable
thereto; and (ii) there are in effect all material licenses, permits and other authorizations
necessary for the current use, occupancy and operation thereof. To the Seller’s Knowledge, except
as may be set forth in Schedule 6.1(h), there is no threatened request, application,
proceeding, plan, study or effort which would materially adversely affect the present use or zoning
of any of the Properties or which would modify or realign any adjacent street or highway.

     (i) Except
as may be set forth on Schedule 6.1 (i), other than the amounts disclosed
by current tax bills, true and correct copies of which have been made available to Purchaser, no
taxes or special assessments of any kind (special, bond or otherwise) are or have been levied with
respect to any of the Properties, or any portion thereof, which are outstanding or unpaid, other
than amounts not yet due and payable or, if due and payable, not yet delinquent.

     (j) The Seller is not a “foreign person” within the meaning of Section 1445 (f) (3) of
the United States Internal Revenue Code of 1986, as amended, and the regulations promulgated
thereunder.

     (k) Except as may be set forth on Schedule 6.1(k) or otherwise disclosed in writing
to the Purchaser, to the Seller’s Knowledge, none of the Seller or any other occupant or user of
any of the Properties, or any portion thereof, have stored or disposed of (or engaged in the
business of storing or disposing of) or have released or caused the release of any hazardous waste,
contaminants, oil, radioactive or other material on any of the Properties, or any portion thereof,
the removal of which is required or the maintenance of which is prohibited or penalized by any
applicable federal, state or local statutes, laws, ordinances, rules or regulations. To the
Seller’s Knowledge, except as may be set forth on Schedule 6.1(k) or otherwise disclosed in
writing to the Purchaser, the Properties are free
from any such hazardous waste, contaminants, oil, radioactive and other materials, except any
such materials maintained in accordance with applicable law.

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     (l) To the Seller’s Knowledge, there are no defects or
inadequacies in any of the Properties which, if uncorrected,
would result in a termination of insurance coverage or an
increase in the premiums charged therefor.

     (m) Except
as may be set forth in Schedule 6.1 (m), to the Seller’s Knowledge, each
of the Properties is in good working order and repair, mechanically and structurally sound, free
from material defects in materials and workmanship and not subject to any unrepaired casualty.

     (n) Except
as may be set forth on Schedule 6.1 (n), all tax returns for privilege,
gross receipts, excise, sales and use, personal property and franchise taxes required by law to be
filed by the Seller with respect to the Properties prior to the Closing Date will be prepared and
duly filed prior to the Closing (or after Closing with respect to pre-Closing matters) and all
taxes, if any, shown on such returns or otherwise determined to be due, together with any interest
or penalties thereon, will be paid by the Seller prior to the Closing, or in a timely manner
following Closing.

     (o) Except
as may be set forth on Schedule 6.1(o), there are in effect all material
licenses (including liquor licenses, if required), permits and other authorizations necessary for
the then current use, occupancy and operation of the Properties.

     (p) Seller has good and marketable title to the FF&E, FAS and Inventories, and such FF&E, FAS
and Inventories were “new” at the time of installation or acquisition, and have not been used prior
to their use at the Properties.

     (q) The FF&E, FAS and Inventories located at or otherwise used in connection with each
Property (i) comply in all material respects with the Brand Standards (as defined in the Management
Agreement) and (ii) are otherwise at adequate, appropriate levels and at levels that are at least
equal to those found at other similarly-situated Staybridge Suites hotels.

     (r) Except
as may be set forth in Schedule 6.1 (r), to the Seller’s Knowledge there
exists no violation of any law, regulation, order or requirement issued by any governmental
authority against or affecting any of the Properties and none of the Seller have received any
notice or order from any governmental authority requiring any repairs, maintenance or improvements
to any Property which have not been fully performed.

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     (s) Each Property constitutes a separate parcel for purposes of ad valorem real property
taxes, and is not subject to a lien for non-payment of real property taxes relating to any other
property.

     (t) Except
as may be set forth on Schedule 6 . 1 (t), to the Seller’s Knowledge,
there exists no material default on the part of the Seller with respect to any Permitted
Encumbrance, other than those defaults which can be cured or discharged by the payment of money and
for which an allowance for the payment thereof has been made at Closing.

     (u) Each of the financial statements of IHG heretofore delivered to the Purchaser have been
properly prepared in accordance with the Accounting Principles (as defined in the Management
Agreement) , are true, correct and complete in all material respects and fairly present the
consolidated financial condition of IHG at and as of the dates thereof and the results of its
operations for the periods covered thereby. Each of the financial statements of the Hotels
heretofore delivered to the Purchaser have been properly prepared in accordance with the Accounting
Principles, are true, correct and complete in all material respects and fairly present the
financial condition, of the Hotels covered thereby at and as of the dates thereof and the results
of their operations for the periods covered thereby.

     (v) Seller is not a debtor in any voluntary or involuntary proceeding in bankruptcy.

     6.2 Survival. The representations and warranties made in
this Agreement by the Seller are made as of the date hereof
except as otherwise expressly provided in this Agreement. All
representations and warranties made in this Agreement by the
Seller shall survive the Closing; provided, however, except with
respect to claims asserted in regard to the representations and
warranties contained in Sections 6.1(a), 6.1(b), 6.1H) and
6.1(n), the Purchaser shall not commence any action for the breach by the Seller of any of
the representations and warranties contained in this Section 6 after the first anniversary
of the Closing Date unless prior to such first anniversary the Purchaser is legally precluded from
commencing such action.

     6.3 No Other Representations.

     (a) EXCEPT AS OTHERWISE EXPRESSLY PROVIDED IN THIS AGREEMENT OR ANY DOCUMENTS TO BE EXECUTED
AND DELIVERED BY THE SELLER AT THE CLOSING, THE SELLER DISCLAIM THE MAKING OF ANY REPRESENTATIONS
OR WARRANTIES, EXPRESS OR IMPLIED, REGARDING THE

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PROPERTIES OR MATTERS AFFECTING THE PROPERTIES, WHETHER MADE BY THE SELLER, ON THEIR BEHALF OR
OTHERWISE, INCLUDING, WITHOUT LIMITATION, THE PHYSICAL CONDITION OF THE PROPERTIES, TITLE TO OR THE
BOUNDARIES OF THE REAL PROPERTY, PEST CONTROL MATTERS, SOIL CONDITIONS, THE PRESENCE, EXISTENCE OR
ABSENCE OF HAZARDOUS WASTES, TOXIC SUBSTANCES OR OTHER ENVIRONMENTAL MATTERS, COMPLIANCE WITH
BUILDING, HEALTH, SAFETY, LAND USE AND ZONING LAWS, REGULATIONS AND ORDERS, STRUCTURAL AND OTHER
ENGINEERING CHARACTERISTICS, TRAFFIC PATTERNS, MARKET DATA, ECONOMIC CONDITIONS OR PROJECTIONS, THE
FITNESS OF THE PROPERTIES FOR USE AS A HOTEL, THE FINANCIAL PERFORMANCE OR POTENTIAL OF THE
PROPERTIES AND ANY OTHER INFORMATION PERTAINING TO THE PROPERTIES OR THE MARKET AND PHYSICAL
ENVIRONMENTS IN WHICH THEY ARE LOCATED. THE PURCHASER ACKNOWLEDGES (I) THAT THE PURCHASER HAS
ENTERED INTO THIS AGREEMENT WITH THE INTENTION OF MAKING AND RELYING UPON ITS OWN INVESTIGATION OR
THAT OF THIRD PARTIES WITH RESPECT TO THE PHYSICAL, ENVIRONMENTAL, FINANCIAL, ECONOMIC AND LEGAL
CONDITION OF EACH PROPERTY; AND (II) THAT THE PURCHASER IS NOT RELYING UPON ANY STATEMENTS,
REPRESENTATIONS OR WARRANTIES OF ANY KIND, OTHER THAN THOSE SPECIFICALLY SET FORTH IN THIS
AGREEMENT OR IN ANY DOCUMENT TO BE EXECUTED AND DELIVERED TO THE PURCHASER AT THE CLOSING, MADE BY
THE SELLER. THE PURCHASER FURTHER ACKNOWLEDGES THAT IT HAS NOT RECEIVED FROM OR ON BEHALF OF THE
SELLER ANY ACCOUNTING, TAX, LEGAL, ARCHITECTURAL, ENGINEERING, PROPERTY MANAGEMENT OR OTHER ADVICE
WITH RESPECT TO THIS TRANSACTION AND IS RELYING SOLELY UPON THE ADVICE OF THIRD PARTY ACCOUNTING,
TAX, LEGAL, ARCHITECTURAL, ENGINEERING, PROPERTY MANAGEMENT AND OTHER ADVISORS. SUBJECT TO THE
PROVISIONS OF THIS AGREEMENT, THE PURCHASER SHALL PURCHASE THE PROPERTIES IN THEIR “AS IS”
CONDITION ON THE CLOSING DATE.

     (b) PURCHASER ACKNOWLEDGES THAT, TO THE EXTENT REQUIRED TO BE OPERATIVE, THE DISCLAIMERS OF
WARRANTIES CONTAINED IN THIS SECTION 6 ARE “CONSPICUOUS” DISCLAIMERS FOR PURPOSES OF ANY
APPLICABLE LAW, RULE, REGULATION OR ORDER.

     SECTION 7 REPRESENTATIONS AND WARRANTIES OF THE PURCHASER.

     To induce the Seller to enter in this Agreement, the Purchaser covenants, represents and
warrants to the Seller as follows:

     7.1 Status and Authority of the Purchaser. The Purchaser is duly organized and
validly existing under the laws of the jurisdictions of its formation, and has all requisite power
and authority under the laws of such jurisdiction and under its charter documents to enter into and
perform its obligations under the Transaction Documents to which it is a party and to consummate
the transactions contemplated thereby. The Purchaser

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is duly qualified and in good standing in each jurisdiction in which the nature of the business
conducted by it requires such qualification, except where such failure to qualify would not have a
material adverse effect on the Purchaser or the transactions contemplated hereby.

     7.2 Action of the Purchaser. The Purchaser has taken (or
will take, prior to the Closing Date) all necessary action to
authorize the execution, delivery and performance of each of the
Transaction Documents to which it is a party, and upon the
execution and delivery of any document to be delivered the
Purchaser on or prior to the Closing Date such document shall
constitute the valid and binding obligation and agreement of the
Purchaser that is party thereto, enforceable against the
Purchaser in accordance with its terms, except as enforceability
may be limited by bankruptcy, insolvency, reorganization,
moratorium or similar laws of general application affecting the
rights and remedies of creditors and general principles of
equity.

     7.3 No Violations of Agreements. Neither the execution,
delivery or performance of the Transaction Documents by the
Purchaser, nor compliance with the terms and provisions thereof,
will result in any breach of the terms, conditions or provisions
of, or conflict with or constitute a default under, or result in
the creation of any lien, or charge upon any property or assets
of the Purchaser pursuant to the terms of any indenture,
mortgage, deed of trust, note, evidence of indebtedness or any other agreement or instrument by which the Purchaser is bound .

     7.4 Litigation. To the actual (and not the imputed or
constructive) knowledge of John Murray, President of HPT, after
due inquiry of appropriate personnel employed by the Purchaser
no action or proceeding is pending or threatened, and no
investigation looking toward such an action or proceeding has
begun, which (a) questions the validity of the Transaction
Documents or any action taken or to be taken pursuant hereto or
(b) is likely to materially and adversely affect the ability of any of the Purchaser to perform its
obligations hereunder.

     7.5 Bankruptcy. None of the Purchaser is a debtor in any
voluntary or involuntary proceeding in bankruptcy.

     The representations and warranties made in this Agreement by the Purchaser are made as of the
date hereof. All representations and warranties made in this Agreement by the Purchaser shall
survive the Closing; provided, however, except with respect to claims asserted in
regard to the representations and warranties contained in Sections 7.1 and 7.2. the
Seller

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shall not commence any action for the breach by the Purchaser of any of the representations and
warranties contained in this Section 7 after the first anniversary of the Closing Date
unless prior to such first anniversary the Seller is legally precluded from commencing such action.

     SECTION 8 COVENANTS OF THE SELLER.

     Between the date hereof and the Closing, and, with respect to the terms of Section 8.7,
thereafter:

     8 .1 Notice of Material Changes or Untrue Representations .
Upon learning of any material change in any condition with respect to the Properties or of any
event or circumstance which makes any representation or warranty of the Seller under this Agreement
untrue, the Seller shall promptly notify the Purchaser thereof (the Purchaser agreeing, on learning
of any such fact or condition, promptly to notify the Seller thereof).

     8.2 Compliance with Laws, Etc. The Seller shall comply in
all material respects with (i) all laws, regulations and other
requirements from time to time applicable of every governmental
body having jurisdiction over the Properties, or the use or
occupancy thereof, and (ii) all material terms, covenants and conditions of all agreements affecting the Properties.

     8.3 Approval of Agreements. The Seller shall not enters
into, modify, amend or terminate any material agreement with
respect to the Properties, which would encumber or be binding
upon the Properties from and after the Closing Date, without in
each instance obtaining the prior written consent of the
Purchaser, which consent shall not be unreasonably withheld.

     8.4 Compliance with Agreements. The Seller shall comply
with each and every material term, covenant and condition
contained in the Contracts or in any material document or
agreement affecting the Properties, and shall monitor compliance
thereunder consistent with past practices.

     8.5 Operation of the Properties. Subject to events beyond
the reasonable control of the Seller, the Seller shall continue
to operate the Properties in a good and businesslike fashion
consistent with past practices and to maintain the Properties in
good working order and condition in a manner consistent with
past practice and the Brand Standards.

     8.6 Insurance. The Seller shall maintain “all risk”
property insurance on a replacement cost basis with respect to
the Properties.

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     8.7
Books. The Seller hereby agree to make all of its books, ledger sheets, files
and records with respect to the operation of the Properties (excluding any portions thereof which
the Seller reasonably determine to be confidential or proprietary) available to the Purchaser for
review and inspection for a period of two (2) years after the Closing Date. The provisions of this
Section 8.7 shall survive Closing under this Agreement.

     SECTION 9 APPORTIONMENTS.

     9.1
Apportionments.

     (a) At the Closing, the following adjustments and
prorations shall be computed as of 12:01 a.m. (local time at
each Property) on the Closing Date (“Apportionment Time”) . All
items of revenue, cost and expense with respect to the period
prior to the Apportionment Time shall be for the account of IHG
and the Seller. All revenues attributable to guests of the
Hotels for the night prior to the Closing Date shall be for the
account of Seller. All items of revenue, cost and expense of
such Property with respect to the period from and after the
Apportionment Time shall be for the account of the Tenant. All
adjustments and prorations shall be on an accrual basis in
accordance with generally accepted accounting principles.
Seller shall be entitled to receive any refunds of any taxes
(real, personal or sales) for any periods prior to Closing,
regardless of when received.

     (b) At the Closing, a fair and reasonable estimated
accounting of all adjustments and prorations shall be performed
and agreed to by IHG, the Seller, the Purchaser and the Tenant .
Subsequent final adjustments and payments (the “True-up”) shall
be made in cash or other immediately available funds as soon as
practicable after the Closing Date for such Property, based upon
an accounting performed by the Seller and acceptable to the
Purchaser and the Tenant. In the event the parties have not
agreed with respect to the adjustments required to be made
pursuant to this Section 9.1(b), upon application by any such
party, a certified public accountant reasonably acceptable to
the parties hereto shall determine any such adjustments which
have not theretofore been agreed to by the parties hereto. The
charges for such accountant shall be borne equally by the
parties to such disputed adjustment. All adjustments to be made
as a result of the final results of the True-up shall be paid to
the party entitled to such adjustment within thirty (30) days
after the final determination thereof.

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     9.2
Closing Costs. The Seller, on one hand, and the
Purchaser, on the other hand, shall share equally all costs and
expenses associated with the transaction contemplated hereby,
including, without limitation, recording, sales and transfer
fees and taxes, local counsel fees (limited to those incurred in
connection with usual and customary local counsel services in
similar commercial real estate transactions) , title insurance
premiums for the owner’s policies, market studies and
appraisals, title, survey and environmental reports, engineering
studies, and the taxes (if any) associated with the transfer of
the FF&E, the FAS and Inventories; provided, however, each party
shall pay its own attorneys’ and accountants’ fees and costs in
connection with this transaction. In addition, the Seller shall
pay any costs associated with the transfer of the roof
warranties. The parties shall make appropriate allocations of
the Purchase Price for purposes of determining any transfer or
recording taxes due in connection herewith.

     9.3 The obligations of the parties under this Section 9 shall survive the Closing.

     SECTION 10 DEFAULT.

     10.1
Default by the Seller. If prior to the Closing the
Seller shall have made any representation or warranty herein
which shall be untrue in any material respect when made or
updated as herein provided or if the Seller shall fail to
perform any of the material covenants and agreements contained
herein and such failure continues for a period of ten (10) days
after notice thereof from the Purchaser, the Purchaser may
terminate this Agreement in its entirety.

     10.2 Default by the Purchaser. If prior to the Closing the
Purchaser shall have made any representation or warranty herein
which shall be untrue or misleading in any material respect, or
if the Purchaser shall fail to perform any of the covenants and
agreements contained herein to be performed by it and such
failure shall continue for a period of ten (10) days, the Seller
may, as its sole and exclusive remedy, at law and in equity,
terminate this Agreement, whereupon, the Purchaser shall pay to
the Seller, as liquidated damages and not as a penalty, an
amount equal to five percent (5%) of the Purchase Price.
Purchaser and Seller acknowledge and agree that if this
Agreement is terminated by reason of Purchaser default hereunder
before the Closing, the damages that Seller will sustain as a
result thereof will be substantial, but the actual damages will
be difficult or impossible to ascertain.

     SECTION 11 MISCELLANEOUS.

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     11.1 Agreement to Indemnify.

     (a) Subject to any express provisions of this Agreement to
the contrary, from and after Closing, the Seller shall indemnify
and hold harmless the Purchaser from and against any and all
obligations, claims, losses, damages, liabilities, and expenses
(including, without limitation, reasonable attorneys’ and
accountants’ fees and disbursements) arising out of (i) a breach
by the Seller of any representation or warranty set forth
herein, (ii) events or contractual obligations, acts, or
omissions of the Seller that occurred in connection with the
ownership or operation of any Property prior to the Closing Date
or (iii) any damage to property of others or injury to or death
of any person or any claims for any debts or obligations
occurring on or about or in connection with any Property or any
portion thereof at any time or times prior to the Closing Date
and during the ownership of such Property by Seller or any of
its affiliates.

     (b) whenever an HPT Party shall learn through the filing
of a claim or the commencement of a proceeding or otherwise of
the existence of any liability for which the Seller are or may
be responsible under this Agreement, the Purchaser shall notify
the Seller promptly and furnish such copies of documents (and
make originals thereof available) and such other information as
the Purchaser may have that may be used or useful in the defense
of such claims and shall afford the Seller the full opportunity
to defend the same in the name of the Purchaser and shall
generally cooperate with the Seller in the defense of any such
claim.

     (c) The provisions of this Section 11.1 shall survive the Closing.

     11.2 Brokerage Commissions. Each of the parties hereto
represents to the other parties that it dealt with no broker,
finder or like agent in connection with this Agreement or the
transactions contemplated hereby, and that it reasonably
believes that there is no basis for any other person or entity
to claim a commission or other compensation for bringing about
this Agreement or the transactions contemplated hereby. The
Seller shall indemnify and hold harmless the Purchaser and its
successors and assigns from and against any loss, liability or
expense, including reasonable attorneys’ fees, arising out of
any claim or claims for commissions or other compensation for;
bringing about this Agreement or the transactions contemplated
hereby made by any broker, finder or like agent, if such claim
or claims are based in whole or in part on dealings with the
Seller. The Purchaser shall indemnify and hold harmless the

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Seller and their respective successors and assigns from and against any loss, liability or
expense, including, reasonable attorneys’ fees, arising out of any claim or claims for commissions
or other compensation for bringing about this Agreement or the transactions contemplated hereby
made by any broker, finder or like agent, if such claim or claims are based in whole or in part on
dealings with the Purchaser. Nothing contained in this section shall be deemed to create any
rights in any third party. The provisions of this Section 11.2 shall survive the Closing
hereunder and any termination of this Agreement.

     11.3
Publicity. Except as may be required by law or as may
be reasonably necessary, on a confidential basis, to inform any
rating agencies, potential sources of financing, financial
analysts, to perform its obligations and duties contained in
this Agreement or to receive legal, accounting and/or tax advice
or to entities involved in a sale of a controlling interest in
the Seller, the Purchaser, or any of their affiliates, the
parties agree that no party shall, with respect to this
Agreement and the transactions contemplated hereby, contact or
conduct negotiations with public officials, make any public
pronouncements, issue press releases or otherwise furnish
information regarding this Agreement or the transactions
contemplated hereby to any third party without the consent of
the other parties, which consent shall not be unreasonably
withheld; provided, however, that, if such information is
required to be disclosed by law, the party so disclosing the
information shall use reasonable efforts to give notice to the
other parties as soon as such party learns that it must make
such disclosure.

     11.4
Public Companies. HPT and IHG are both publicly traded companies. None of IHG, HPT or their affiliates and
representatives shall trade in the securities of the other party
during the pendency of this transaction until all material facts
concerning this transaction are publicly announced and the
market has had the opportunity to absorb the announcement.

     11.5
Notices.

     (a) Any and all notices, demands, consents, approvals, offers, elections and other
communications required or permitted under this Agreement shall be deemed adequately given if in
writing and the same shall be delivered either by hand, by telecopier with written acknowledgment
of receipt (provided a copy is sent by Federal Express or similar expedited commercial carrier for
delivery the next Business Day), or by mail or Federal Express or similar expedited
commercial carrier,

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addressed to the recipient of
the notice, postpaid and registered or certified with return receipt requested (if by mail),
or with all freight charges prepaid (if by Federal Express or similar carrier).

     (b) All notices required or permitted to be sent hereunder shall be deemed to have been given
for all purposes of this Agreement upon the date of acknowledged receipt, in the case of a notice
by telecopier, and, in all other cases, upon the date of receipt or refusal, except that whenever
under this Agreement a notice is either received on a day which is not a Business Day or is
required to be delivered on or before a specific day which is not a Business Day, the day of
receipt or required delivery shall automatically be extended to the next Business Day.

All such notices shall be addressed,

     If to the Seller to:

          InterContinental Hotels Group Resources, Inc.

          c/o Six Continents Hotels, Inc.

          3 Ravinia Drive, Suite 100

          Atlanta, Georgia 30346

          Attn: Vice President of Operations

          [Telecopier No. (770) 604-8875

     with a copy to:

          InterContinental Hotels Group Resources, Inc.

          c/o Six Continents Hotels, Inc.

          3 Ravinia Drive, Suite 100

          Atlanta, Georgia 30346

          Attn: General Counsel — Operations

          [Telecopier No. (770) 604-5802

     If to any HPT Party, to:

          Hospitality Properties Trust

          400 Centre Street

          Newton, Massachusetts 02458

          Attn: John G. Murray

          [Telecopier No. (617) 969-5730]

- 24 -

 

     with a copy to:

          Sullivan & Worcester LLP

          One Post Office Square

          Boston, Massachusetts 02109

          Attn: Warren M. Heilbronner, Esq.

          [Telecopier No. (617) 338-2880]

     By
notice given as herein provided, the parties hereto and their respective successors and
assigns shall have the right from time to time and at any time during the term of this Agreement to
change their respective addresses effective upon receipt by the other parties of such notice and
each shall have the right to specify as its address any other address
within the United States of
America.

     11.6
Waivers, Etc. Any waiver of any term or condition of
this Agreement, or of the breach of any covenant, representation
or warranty contained herein, in any one instance, shall not
operate as or be deemed to be or construed as a further or
continuing waiver of any other breach of such term, condition,
covenant, representation or warranty or any other term,
condition, covenant, representation or warranty, nor shall any
failure at any time or times to enforce or require performance
of any provision hereof operate as a waiver of or affect in any
manner such party’s right at a later time to enforce or require
performance of such provision or any other provision hereof.
This Agreement may not be amended, nor shall any waiver, change,
modification, consent or discharge be effected, except by an
instrument in writing executed by or on behalf of the party
against whom enforcement of any amendment, waiver, change,
modification, consent or discharge is sought.

     11.7
Assignment; Successors and Assigns. This Agreement
and all rights and obligations hereunder shall not be assignable
by any party without the written consent of the other parties,
except that the Purchaser may assign this Agreement to any
entity wholly owned, directly or indirectly, by the Purchaser;
provided, however, that, in the event this Agreement shall be
assigned to any entity wholly owned, directly or indirectly, by
the Purchaser, HPT shall remain fully and primarily liable for the obligations of the “Purchaser” hereunder. In addition,
Purchaser shall have the right to require that the Properties or
any part thereof be conveyed directly to its designee. This
Agreement shall be binding upon and shall inure to the benefit
of the parties hereto and their respective legal
representatives, successors and permitted assigns. This
Agreement is not intended and shall not be construed to create

- 25 -

 

any rights in or to be enforceable in any part by any other persons.

     11.8
Severability. If any provision of this Agreement
shall be held or deemed to be, or shall in fact be, invalid,
inoperative or unenforceable as applied to any particular case
in any jurisdiction or jurisdictions, or in all jurisdictions or
in all cases, because of the conflict of any provision with any
constitution or statute or rule of public policy or for any
other reason, such circumstance shall not have the effect of
rendering the provision or provisions in question invalid,
inoperative or unenforceable in any other jurisdiction or in any
other case or circumstance or of rendering any other provision
or provisions herein contained invalid, inoperative or
unenforceable to the extent that such other provisions are not
themselves actually in conflict with such constitution, statute
or rule of public policy, but this Agreement shall be reformed
and construed in any such jurisdiction or case as if such
invalid, inoperative or unenforceable provision had never been
contained herein and such provision reformed so that it would be
valid, operative and enforceable to the maximum extent permitted
in such jurisdiction or in such case. Except for obligations
which by their terms are to survive Closing or which by their
express terms are to be performed following Closing, the terms
and provisions of this Agreement shall not survive the Closing
and shall merge into the deeds from the Seller to the Purchaser.
The provisions of the immediately preceding sentence shall
survive the Closing.

     11.9
Counterparts. Etc. This Agreement may be executed in
two or more counterparts, each of which shall be deemed an
original, but all of which together shall constitute one and the
same instrument. This Agreement constitutes the entire
agreement of the parties hereto with respect to the subject
matter hereof and shall supersede and take the place of any
other instruments purporting to be an agreement of the parties
hereto relating to the subject matter hereof. This Agreement
may not be amended or modified in any respect other than by the
written agreement of all of the parties hereto.

     11.10
Governing Law.

     (a) This Agreement shall be interpreted, construed, applied and enforced in accordance with
the laws of the State of New York applicable to contracts between residents of New York which are
to be performed entirely within New York, regardless of (i) where this Agreement is executed or
delivered, (ii) where any payment or other performance required by this Agreement is made or
required to be made, (iii) where any breach of any

- 26 -

 

provision of this Agreement occurs, or any cause of action otherwise accrues, (iv) where any action
or other proceeding is instituted or pending, (v) the nationality, citizenship, domicile, principal
place of business, or jurisdiction of organization or domestication of any party, (vi) whether the
laws of the forum jurisdiction otherwise would apply the laws of a jurisdiction other than New
York, (vii) the location of the Properties or any applicable Property, or (viii) any combination of
the foregoing.

     (b) All actions and proceedings arising out of or in any
way relating to this Agreement shall be brought, heard, and
determined exclusively in an otherwise appropriate federal or
state court located within New York County, New York. The
parties hereby (i) submit to the exclusive jurisdiction of any New York federal or state court of otherwise competent
jurisdiction for the purpose of any action or proceeding arising
out of or relating to this Agreement and (ii) voluntarily and
irrevocably waives, and agrees not to assert by way of motion,
defense, or otherwise in any such action or proceeding, any
claim or defense that it is not personally subject to the
jurisdiction of such a court, that such a court lacks personal
jurisdiction over any party or the matter, that the action or
proceeding has been brought in an inconvenient or improper
forum, that the venue of the action or proceeding is improper,
or that this Agreement may not be enforced in or by such a court. To the maximum extent permitted
by applicable law, each party consents to service of process by registered mail, return receipt
requested, or by any other manner provided by law.

     (c) To the maximum extent permitted by applicable law,
each of the parties hereto waives its rights to trial by jury
with respect to this Agreement or matters arising in connection
herewith.

     11.11
Performance on Business Days. In the event the
date on which performance or payment of any obligation of a
party required hereunder is other than a Business Day, the time
for payment or performance shall automatically be extended to
the first Business Day following such date.

     11.12
Attorneys’ Fees. If any lawsuit or arbitration
or other legal proceeding arises in connection with the
interpretation or enforcement of this Agreement, the prevailing
party therein shall be entitled to receive from the other party
the prevailing party’s costs and expenses, including reasonable
attorneys’ fees incurred in connection therewith, in preparation
therefor and on appeal therefrom, which amounts shall be

- 27 -

 

included in any judgment therein. The terms of this Section 11.12 shall survive
the Closing.

     11.13
Section and Other Headings. The headings
contained in this Agreement are for reference purposes only and
shall not in any way affect the meaning or interpretation of
this Agreement. Unless the context clearly requires otherwise,
the words “herein”, “hereunder”, and “hereby”, whenever used in
this Agreement, shall refer to this Agreement as a whole, and
not only to the sections, subsections, paragraphs or
subparagraphs of this Agreement in which such words appear.

     11.14
Time of Essence. Time is of the essence of
this Agreement and each term and provision hereof.

     11.15
Limitation of Liability. No advisor, trustee,
director, officer, employee, beneficiary, shareholder, member,
partner, participant, representative or agent of IHG or HPT
shall have any personal liability, directly or indirectly, under
or in connection with this Agreement or any agreement made or
entered into pursuant to the provisions of this Agreement, or
any amendment or amendments to any of the foregoing made at any
time or times heretofore or hereafter. In no event shall any of
the Purchaser or the Seller be entitled to punitive,
consequential or special damages under this Agreement, and each
of the Purchaser and the Seller hereby waives any right to
claim, pursue or collect same. The provisions of this Section
11.15 shall survive any termination of this Agreement and the
Closing hereunder.

     11.16
State Specific Provisions.

     CA: None.

     CO: None.

     FL:

               Radon Disclosure. The Purchaser acknowledges the following Radon Gas disclosures
required by Florida Statute 404.056, Subsection 8:

RADON GAS: Radon is a naturally occurring radioactive gas that,
when it has accumulated in a building in sufficient quantities,
may present health risks to persons who are exposed to it over
time. Levels of radon that exceed federal and state guidelines
have been found in

- 28 -

 

buildings in Florida. Additional information regarding Radon and
Radon testing may be obtained from county public health units.

	 	GA:	 	None.

	 	MO:	 	None.

	 	MA:	 	None.

	 	MI:	 	None.

	 	NC:	 	None.

	 	TX:	 	None.

	 	WA:	 	None.

     11.17
Nonliability of Trustees. THE DECLARATIONS OF TRUST ESTABLISHING PURCHASER,
COPIES OF WHICH, TOGETHER WITH ALL AMENDMENTS THERETO (THE
“DECLARATION”), IS DULY FILED
WITH THE DEPARTMENT OF ASSESSMENTS AND TAXATION OF THE STATE OF MARYLAND, PROVIDES THAT, AND THE
SELLER HEREBY AGREES THAT, THE NAME “HPT IHG PROPERTIES TRUST” REFERS TO THE TRUSTEES UNDER THE
DECLARATION COLLECTIVELY AS TRUSTEES, BUT NOT INDIVIDUALLY OR PERSONALLY, AND THAT NO TRUSTEE,
OFFICER, SHAREHOLDER, EMPLOYEE OR AGENT OF PURCHASER SHALL BE HELD TO ANY PERSONAL LIABILITY,
JOINTLY OR SEVERALLY, FOR ANY OBLIGATION OF, OR CLAIM AGAINST, PURCHASER. ALL PERSONS DEALING WITH
PURCHASER, IN ANY WAY, SHALL LOOK ONLY TO THE ASSETS OF PURCHASER, FOR THE PAYMENT OF ANY SUM OR
THE PERFORMANCE OF ANY OBLIGATION.

- 29 -

 

     IN WITNESS WHEREOF, the parties have caused this Agreement to be executed as a sealed
instrument as of the date first above written.

	 	 	 	 	 
	 	SELLER:

INTERCONTINENTAL HOTELS GROUP

RESOURCES, INC.

 	 
	 	By:  	/s/   Robert C. Gunkel
 	 
	 	 	Its: Robert C. Gunkel 	 
	 	 	      Vice President 	 
	 

	 	 	 	 	 
	 	PURCHASER:

HPT IHG PROPERTIES TRUST

 	 
	 	By:  	/s/        John G. Murray
 	 
	 	 	Its: John G. Murray 	 
	 	 	      President 	 
	 

- 30 -

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