SEC Info℠

Home

Search

My Interests

Help

Sign In

Please Sign In

Hyco International, Inc. – IPO: ‘S-1’ on 5/12/06 – EX-10.3

On:  Friday, 5/12/06, at 3:56pm ET   ·   Accession #:  1193125-6-110769   ·   File #:  333-134066

Previous ‘S-1’:  None   ·   Next & Latest:  ‘S-1/A’ on 6/30/06

in

this entire Filing. an “Entity” Search.

Show

Documents searched

and

each “hit”. the 1st “hit”.

↓↑Hints

 Text Wildcards:  ? (any letter/digit),  * (many).  Search Logic:  for Documents:  & (and),  | (or);  for Text:  | (anywhere),  "(&)" (near).  Details... 

  As Of                Filer                Filing    For·On·As Docs:Size              Issuer               Agent

 5/12/06  Hyco International, Inc.          S-1                   15:4.8M                                   RR Donnelley/FA

Document/Exhibit                   Description                      Pages   Size 

 1: S-1         Registration Statement (General Form)               HTML   1.13M 
 2: EX-4.2      Stockholders' Agreement                             HTML     66K 
 3: EX-4.3      Registration Rights Agreement                       HTML     54K 
 4: EX-4.4      Hyco International, Inc. 1998 Stock Option Plan     HTML     46K 
 5: EX-10.1     Credit Agreement                                    HTML    370K 
 6: EX-10.2     Business Finance Agreement                          HTML    461K 
 7: EX-10.3     Business Finance Agreement                          HTML    398K 
 8: EX-10.4     Trust Indenture                                     HTML    381K 
 9: EX-10.5     Trust Indenture                                     HTML    403K 
10: EX-10.6     Tax-Exempt Credit Agreement                         HTML    235K 
11: EX-10.7     Taxable Credit Agreement                            HTML    236K 
12: EX-10.8     Lease Agreement                                     HTML    231K 
13: EX-10.9     Lease Between Ultra Metal Inc. and Huron Woods      HTML    150K 
                          Development Corp.                                      
14: EX-21.1     List of Subsidiaries of Hyco International, Inc.    HTML     12K 
15: EX-23.1     Consent of Deloitte & Touche LLP                    HTML      8K 

Exhibit 10.3

Execution Document

GE COMMERCIAL FINANCE LIMITED

- and -

HYCO HENGSTLER HYDRAULIK GmbH

BUSINESS FINANCE AGREEMENT

Page 1

INTRODUCTION

THIS AGREEMENT is made on                      2005

BETWEEN:

This Agreement sets out the terms upon which we have agreed to make certain finance facilities available to you. It incorporates our standard terms of business set out in the Appendix entitled “GE Standard Terms” which has been provided to you.

Terms used in this Agreement are defined in the GE Standard Terms.

This Agreement may be executed in any number of counterparts and by different parties on separate counterparts each of which, when executed and delivered, shall constitute an original and all the counterparts together shall constitute but one and the same instrument.

This Agreement shall be effective from the Commencement Date.

GENERAL

Page 2

PART I: INVOICE FINANCE FACILITY

Page 3

YOUR DECLARATION

We, the signatories on behalf of the Client, hereby confirm and declare that for the purpose of the Data Protection Notice provisions set out in the GE Standard Terms:

POWER TO ACT IN YOUR NAME

In order to perfect our title to any Debt or its Associated Rights, exercise our rights under any Financing Documents or otherwise and to secure that you and each Debtor carry out your obligations to us, by way of security, you irrevocably appoint us and every officer of ours (and any person to whom we transfer, assign or novate this Agreement or any of the Financing Documents) at any time jointly and severally to be your attorneys. This power of attorney is irrevocable, given to secure obligations due to us under all of the Financing Documents and shall not expire until all monies and obligations due to us under all of the Financing Documents have been paid and discharged and we are under no further obligation to any Client under any of the Financing Documents. This will enable us, without notice to you, to:

Page 4

Any attorney appointed above may in turn appoint and remove any substitute attorney or agent for you for the matters set out above.

You will ratify anything lawfully done by any attorney, substitute attorney or agent under the powers set out above.

Page 5

SCHEDULE I: CONDITIONS PRECEDENT

Before making any Facility available to you, we require the following conditions precedent to be satisfied on terms satisfactory to us:

General

No Default has occurred and is continuing.

You and any other person which is a party (other than us) to a Financing Document has delivered to us copies certified as true, complete and accurate of your and each such other person’s articles of incorporation (and any certificate of incorporation on change of name) and/or articles of association and commercial register excerpts (Handelsregisterauszuge) relating to you and such other person.

You have provided us with a Group structure chart, complete as at the date hereof.

In respect of each Client (and the directors and shareholders of such entities), our being satisfied with the results of the GE “Know Your Customer” (anti-money laundering) checks and procedures concerning such persons, as required by GE policies and/or by applicable laws or regulations.

You have paid all fees and expenses (plus VAT) property incurred by us in connection with the negotiation and documentation of any such Facility and our satisfaction with your compliance with any conditions precedent.

Evidence of an appropriate cash management system and our satisfaction with its operation.

Completion of, and satisfactory results from, a legal review of all material contracts.

Debts

Copies of the contract with Komatsu UK Limited, such contract to be on acceptable terms.

Security

A perfected first ranking security assignment over the Client’s Non-Vesting Debts.

A negative pledge in respect of the creation of any intra-group debt obligations other than (a) those referred to in the final paragraph of Schedule 2 of this Agreement, (b) the annual allocation of Approved Management Charges, and (c) incidental operating charges between members of the Group consistent with practices prior to the date hereof.

Financial

In relation to each Client, sight of and satisfaction with updated profit and loss account, balance sheet for the year ended 31 December 2004. The audited accounts of the Client and Hyco International Inc. for the year ending 31 December 2004.

Page 6

The management accounts of the Client and Hyco International Inc. (including both profit and loss account and balance sheet)for the period ending 31 July 2005.

Miscellaneous

Legal opinions from our and your German counsel on due execution, authority, effectiveness and enforceability of the Financing Documents in a form acceptable to us.

In respect of the Client and any person (other than us) which is a party to a Financing Document, copies certified as true, complete and accurate of board resolutions or shareholders’ written resolutions (as appropriate) evidencing due authorisation of the Financing Documents, authorising named officers to execute them and containing specimen signatures of those officers.

The payment of all legal fees and expenses (plus VAT) as may have been properly incurred by us in connection with the negotiation and documentation of our facilities and our satisfaction with your compliance with any conditions precedent.

Page 7

SCHEDULE II: SPECIAL CONDITIONS

In additional to the GE Standard Terms, the following special conditions apply to the Facilities:

Debts

Debt turn must not exceed 70 days (when measured on a cash collection basis, this being the result of dividing the total of the end of calendar month Debtor balances by the cash collections for the period and multiplying the result by 30.5 for a monthly average).

The value of credit notes and/or any other dilution as a percentage of Notified turnover must not exceed 4% when measured on a rolling six month basis - if this is breached we reserve the right to reduce the Advance Percentage in line with the amount by which the 4% target is exceeded.

You will insert a notice on each page of your sales ledger identifying our interest in all applicable Debts.

All payments received in settlement of Debts, including cash sales, must be forwarded to us.

A signed proof of delivery or collection must be held to our order.

Non-recourse: Debts which are:

shall not be deemed to be Unapproved Debts for the purposes of this Agreement and accordingly the provisions of Paragraph 12 of the Invoice Finance Schedule in the GE Standard Terms (“Reassignment and Recourse”) shall not apply to any such Debts.

Financial

As soon as they become available, but in any event within 30 days of each month end, you will deliver to us your monthly management accounts to include profit and loss account, balance sheet and cashflow projection.

As soon as they become available, but in any event within 180 days after the end of each financial year, you will deliver to us your audited accounts together with the audited accounts of each member of the Group (if any).

You will not, without our consent (which will not be unreasonably withheld), change your financial year.

The ratio of EBITDA to Borrowing Costs for Hyco Hengstler Hydraulik GmbH must not fall below 2:1 when measured on a rolling six financial month basis, calculated by reference to the audited accounts or management accounts most recently provided to us, the first measurement date to be the last day of the month immediately following the Commencement Date.

Page 8

The following words shall have the following meaning when used in the Business Finance Agreement:

Applicable GAAP: in relation to the audited accounts or management accounts of any Client or other Obligor, generally accepted accounting principles and policies in the country of incorporation of such person consistent with those applied in the preparation of its audited accounts first provided to us on or after the Commencement Date.

Borrowing Costs: in relation to the Client and its financial year or any period for which its management accounts have been prepared, a sum equal to the aggregate amount (determined on a consolidated basis if that company has one or more Subsidiaries or on an individual basis as we may determine) all of continuing, regular or periodic costs, charges, fees and expenses incurred by it in respect of such period (and whether paid or not) in effecting, servicing or maintaining Borrowings. The amount of any such costs, charges and expenses shall be allocated to each such period over the term of any Borrowings in accordance with Applicable GAAP.

EBITDA: in relation to the Client and its financial year or period for which its management accounts have been prepared, a sum equal to its profit on ordinary activities before taxation (determined on a consolidated basis if that company has one or more Subsidiaries or on an individual basis as we may determine) after adding back Borrowing costs, depreciation and any amortisations in respect of such period but excluding:

Fees and Charges

We will carry out quarterly audits commencing three months from the Commencement Date and continuing throughout the term of this Agreement.

You will pay our administration charge of £27.50 (or the euro equivalent) each time we make a payment to you by CHAPS.

You will pay our aggregate Service Charges of €36,500 per annum at the times and on the terms specified in Schedule 1 above.

You will pay our cheque administration fee of £27.50 (or the euro equivalent) each time we receive a Remittance by cheque.

A facility fee of €23,000 will accrue and become payable on the Commencement Date.

A non-utilisation fee will be payable on the last day of each month, such fee being an amount equal to 0.5% per annum multiplied by the average daily availability in aggregate on each Facility during such month, such fee to be debited to the Current Account.

Page 9

Intercompany Indebtedness

Within 60 days of the date of this Agreement, evidence that the debts owed to Hyco Holdings LLC by the Client in the principal sum of up to €1,800,000 plus interest accrued thereon has been or will be repaid in full.

Page 10

This Agreement has been duly executed as a deed by you and signed by us as set out below.

Address

Fax:

Attention:

Page 11

APPENDIX TO

BUSINESS FINANCE AGREEMENT

GE STANDARD

TERMS

Page 12

CONTENTS

Page 13

INTRODUCTION

These GE Standard Terms contain all the standard terms and conditions relating to GE Commercial Finance’s business finance facilities. They comprise general terms (which set out the general terms and conditions which apply to all Facilities provided by us) and the Schedules (as detailed below) which set out the detailed terms and conditions for specific Facilities that we may have agreed to provide to you.

These GE Standard Terms (including the Schedules and any annex or appendix to those Schedules) form part of your Business Finance Agreement with us and are in addition to any specific terms and conditions set out in the Business Finance Agreement itself.

SCHEDULES

INVOICE FINANCE SCHEDULE

CREDIT PROTECTION SCHEDULE

PLANT AND MACHINERY SCHEDULE

REAL PROPERTY SCHEDULE

GENERAL TERMS

These general terms and conditions apply to all Facilities provided by us under the Business Finance Agreement.

Accounting Records: all books, ledgers and records of any kind and in any medium relating to your business or financial position and to all purchases and sales made by you.

Advance: a payment on account of the Purchase Price of each Debt, provided it is not an Unapproved Debt or a Non-Notifiable Debt, calculated by applying to it the Advance Percentage specified in the Business Finance Agreement.

Advance Percentage: in relation to any Client and any Advance, the applicable advance percentage specified in the Business Finance Agreement (as such percentage may vary in accordance with its terms).

Advance Period: in relation to any Client, the period specified as such in the Business Finance Agreement, at the end of which a Debt shall automatically become an Unapproved Debt, or such other period as we may advise you.

Aggregate Current Account Limit: the Aggregate Current Account Limit specified in the Business Finance Agreement (if any) beyond which the aggregate balance of all Current Accounts must not be overdrawn.

Approved Currency: euro, sterling and any other currency specified in the Business Finance Agreement and/or such other currencies as we may notify to you in writing from time to time.

Approved Management Charges: annual charges payable by the Client to other members of the Group for management services up to a maximum amount not exceeding 2% of annual sales of the Client.

Approved Territory: the United Kingdom and, if the Invoice Finance Facility includes Export Debts, the EEA, USA, Canada, Australia and New Zealand provided that we may, by written notice to you add or remove any territory, region or continent from this definition.

Page 14

Asset Account: an account kept by us reflecting the prospective Notified Value of Debts; where there is more than one such account kept by us, any reference to an Asset Account shall, where the context allows, include a reference to each such separate account.

Assignment by way of Security: an assignment by way of security of Non-Vesting Debts or an assignment by way of security of Non-Vesting Debts and Floating Charge, in each case governed by English law, which you may enter into with us at any time.

Associate: a person which, directly or indirectly, controls or is controlled by or is under common control with you, or a person which beneficially owns or holds, directly or indirectly, five per cent or more of any class of voting shares of you, or a person in which five per cent of any class of voting shares is beneficially owned or held directly or indirectly, by you.

Associated Rights: in relation to any Debt, any of the following:

Availability: a Client’s entitlement, subject to the relevant Current Account Limit and the Aggregate Current Account Limit, to take further Advances in respect of Debts, calculated by:

BACS: the Bankers Automated Clearing System.

Base Currency: euro, unless otherwise stated in the Business Finance Agreement.

Base Currency Equivalent: in relation to any amount denominated in a currency other than a Base Currency, the equivalent in the Base Currency of such amount as determined by us by reference to the spot rate of exchange of Standard Chartered Bank Plc (or other such UK clearing bank as we may specify) for the purchase of the Base Currency in London with the relevant currency at such times as we may specify on the date on which the relevant determination falls to be made and, in relation to any amount denominated in a Base Currency, such Base Currency amount.

Base Rate: on any day EURIBOR or LIBOR, as the case may be, on that day.

Page 15

Business Finance Agreement: the agreement entered into between us and one or more Clients which is entitled or otherwise referred to as “the Business Finance Agreement” and which incorporates the GE Standard Terms (as may be amended and restated from time to time).

CHAPS: the Clearing House Automated Payments System.

Client: each of those persons listed in the Business Finance Agreement as a Client.

Collateral: in relation to any Client, all property and assets, whether real or personal, tangible or intangible, in which it may, at any time have any right, title, or interest.

Commencement Date: the date of the Business Finance Agreement or such later date that we notify you is the Commencement Date.

Confidential Information: all information (whether in oral, written or electronic form) belonging or relating to us, our business or activities which is not in the public domain which:

Confidential Information shall include, but not be limited to, all access telephone numbers, user identification numbers, passwords, test keys, access codes and security procedures relating to any website we operate and the Electronic Data.

Contract of Sale: a contract in any form, including a purchase order, between you and a Debtor for the sale or hire of Goods or the provision of services or work done.

Credit Protection: services provided by us if the Business Finance Agreement provides for credit protection in respect of the Invoice Finance Facility.

Current Account: an account operated by us which will be used, inter alia, to calculate Discount (and, where relevant, interest, fees and expenses) and from which, if applicable, payments due under any Facility will be satisfied; where there is more than one such account operated by us, any reference to a Current Account shall, where the context allows, include a reference to each such separate account.

Current Account Limit: subject to the Aggregate Current Account Limit (if any), the financial limit specified in the Business Finance Agreement, beyond which a Current Account may not be overdrawn.

Debenture: an English law composite guarantee and debenture with us to which each Client and/or its Associates are or may in future be a party.

Debt: any obligation (present, future or contingent) of a Debtor to make payment under a Contract of Sale, including all Associated Rights.

Debtor: a person who incurs or may incur any indebtedness under a Contract of Sale.

Debtor Balance: in respect of each Debtor, the amount of all Debts Outstanding from that Debtor.

Debtor Concentration Percentage: in respect of any Debtor and any Client, the percentage shown in the Business Finance Agreement as a percentage of the balance of all Outstanding Debts of that Debtor after deducting Non-Notifiable Debts, or such other percentage as we may advise you in writing.

Default: any Event of Default or any event which with the passage of time or giving of notice or both, would or might, unless cured or waived become an Event of Default.

Page 16

Delivered: in relation to Goods:

Discount: the deduction from the Purchase Price calculated in accordance with paragraph 6.1 of the Invoice Finance Schedule.

Discount Margin: the percentage by which the Discount Rate exceeds Base Rate.

Discount Rate: in relation to any Client, the rate specified as the discount rate in the Business Finance Agreement.

Dispute: with respect to any Debt or Contract of Sale giving rise thereto: (i) any claim or demand with regard to price, terms, quantity, performance, quality or delivery of Goods or services; (ii) any other defence, set-off, retention, abatement, counter-claim or contra account raised or alleged by a Debtor or its representatives; and (iii) any other dispute by a Debtor concerning its liability to pay such Debt (whether to you or us) or pay such Debt by its due date.

Dormant Company: a company which is a “dormant” company as defined in section 250(3) Companies Act 1985 and which does not at any time have assets (other than intercompany indebtedness) in excess of £5,000 (or the Base Currency Equivalent thereof).

EEA: the European Economic Area, which is the area the subject of the Treaty of Oporto signed in 1992 as from time to time amended between members of the European Union and certain members of the European Free Trade Association.

Electronic Data: all information provided via the internet or any other form of electronic communication pursuant to the Business Finance Agreement.

Encumbrance: any mortgage, charge, standard security, pledge, lien, assignment or assignation by way of security, hypothecation, security interest, title retention, flawed asset agreement, preferential right, right of set-off, trust arrangement or other arrangement for the purpose of and having a similar effect to the granting of security whether by Law or agreement or other security interest of any kind.

EURIBOR: on any date and for any amount in any currency, the rate per annum which we stipulate as EURIBOR for such currency amount on such date for the period we have agreed to offer you EURIBOR.

Event of Default: any of the following:

Page 17

Page 18

provided that with the exception of items (1), (6) or (7) (insofar as it relates to item 6 only) above, you shall have not more than ten business days to remedy such event before the occurrence of the relevant event shall constitute an Event of Default.

Excluded Debt: a Debt or part of a Debt which, based on our reasonable credit judgment taking into account the quality or performance of the collateral, we consider is a Debt:

favour has been terminated.

Export Debt: a Debt whose invoice is addressed to a Debtor outside the United Kingdom and/or in respect of which payment is to originate from outside the United Kingdom.

Facilities: the Invoice Finance Facility, any Trade Finance Facility and each Loan Facility (if any) and “Facility” means any one of them.

Financial Indebtedness: indebtedness in respect of:-

Page 19

Financing Documents: the following documents:

Force Majeure: an act of God, natural disaster, any exchange control, governmental or other official regulations or requirements, the outbreak of war, any terrorist act, revolution, civil insurrection, strike, lockout, industrial action or failure of postal, banking or communication services and any circumstances outside our or a Debtor’s reasonable control.

Foreign Currency: any currency that is freely transferable and freely convertible into euro as may be specifically agreed by us in writing.

GE Standard Terms: the terms set out in the document entitled or otherwise referred to as the “GE Standard Terms” (including those terms set out in the Schedules and any annex or appendix thereto).

Goods: any merchandise or materials, or where the context admits, any work or services which are the subject of a Contract of Sale.

Group: in relation to any company, that company and its Subsidiaries, its holding company (as defined in section 736 Companies Act 1985) and the Subsidiaries of that holding company (and “member of the Group” shall be construed accordingly).

Insolvent:

Page 20

Page 21

and “Insolvency” shall be construed accordingly.

Invoice Finance Facility: the invoice finance facility to be made available under the Business Finance Agreement.

Liabilities: monies payable or possibly payable in future by you to us including liability:

LIBOR: on any date and for any amount in any currency, the rate per annum which we stipulate as LIBOR for such currency amount on such date for the period we have agreed to offer you LIBOR.

Loan Facilities: the Plant and Machinery Term Loan Facility and the Real Property Term Loan Facility and “Loan Facility” means any one of them.

Minimum Service Charge: in relation to any Client, the minimum service charge (if any) specified in the Business Finance Agreement.

Non-Notifiable Debt: any Debt which:

together with any other Debt as we shall specify at any time as being a Non-Notifiable Debt and together also with, if Collection Services are being provided by us, any Debt which is due by a Debtor which also supplies goods or services to you.

Non-Vesting Debt: any Debt which either fails to vest in us for any reason or where the assignment or assignation of that Debt to us is void whether as between us and you or as between us and any third party.

Notice Period: the Notice Period specified in the Business Finance Agreement.

Notification: your notification to us, in such a way as we may specify, of all Debts (including, whenever we so require, Non-Notifiable Debts) and credit notes or other dilutions which have come into existence but which have not previously been Notified to us together with such evidence of the performance of the Contract of Sale or reasons for a credit note or dilution as we may specify.

Page 22

Notified/Notify/Notifying: inclusion of a Debt in a Notification delivered to us.

Notified Value: the amount of the Debt as shown in a Notification.

Obligor: the Client(s) and any person(s) who have entered into any agreement or instrument evidencing or creating an Encumbrance, guarantee or other assurance against loss in respect of your obligations to us.

Outstanding: in relation to a Debt, that such Debt is undischarged by the Debtor or a third party.

Permitted Capex: finance leases granted to the Client by third parties for the purpose of capital expenditure by the Client for up to an amount not exceeding €1,000,000.

Plant and Machinery: in relation to any person, all plant, machinery and other equipment and other tangible personal property (except Inventory) owned by it at any time wherever located and all spare parts, replacements, modifications and additions for or to the same and any manuals, logbooks or registration documents relating thereto.

Plant and Machinery Term Loan Facility: the plant and machinery term loan facility, if any, made or to be made available under the Business Finance Agreement.

Preferential Creditors: all those persons specified in Schedule 6 to the Insolvency Act 1986 as having preferential debts and any other person which, in our reasonable opinion, may be entitled to receive payment out of floating charge realisations in priority to us.

Purchase Price: the price payable by us for a Debt calculated in accordance with paragraph 4.1 of the Invoice Finance Schedule.

Real Property: in relation to any person, all freehold and leasehold properties and other real property both present and future of that person, including all buildings and other structures from time to time erected thereon and all fixtures (trade or otherwise) from time to time thereon or therein.

Real Property Term Loan Facility: the real property term loan facility, if any, made or to be made available under the Business Finance Agreement.

Reassignment: our right to require you immediately to repurchase an Outstanding Debt at a price equivalent to the lesser of its Notified Value or the Advance paid in respect of it and “Reassign” shall be construed accordingly.

Recourse: our right to require you immediately to repay to us any Advance paid to you in respect of an Unapproved Debt.

Remittances: cash, cheques, bills of exchange, negotiable and non negotiable instruments, letters of credit, electronic payments, BACS, CHAPS and any other remittance or instrument of payment in whatever form received by us, you or your agents towards discharge of a Debt.

Returned Goods: any Goods relating to or purporting to comply with a Contract of Sale which any Debtor shall for any reason reject or return or attempt to reject or return to you or us or which you or we recover from a Debtor.

Returns Due Date: ten (10) Working Days after each month end.

Revolving Inventory Loan Facility: the revolving inventory loan facility, if any, to be made available under the Business Finance Agreement.

Schedule: a Schedule to the GE Standard Terms.

Page 23

Scottish Assignation: a Scottish law assignation in security in respect of any intangible property in Scotland, including in respect of any rents falling due on any heritable property in Scotland which you have let, which each Client and/or its Associates may enter into with us at any time.

Scottish Debts: Debts arising under Contracts of Sale where either the proper law of the Contract of Sale is Scottish law or the invoices for the Debts are addressed to Debtors in Scotland.

Scottish Floating Charge: a Scottish law floating charge in respect of any assets in Scotland which each Client and/or its Associates may enter into with us at any time.

Scottish Security Document: each, if any, of any Scottish Floating Charge, Scottish Assignation, Scottish Share Pledge and Scottish Standard Security.

Scottish Share Pledge: a Scottish law share pledge in respect of shares in any company registered in Scotland which each Client and/or its Associates may enter into with us at any time.

Scottish Standard Security: a Scottish law standard security in respect of any heritable property in Scotland which each Client and/or its Associates may enter into with us at any time.

Service Charge: in relation to any Client, our charge for the services to be rendered under the Business Finance Agreement calculated as provided for in the Business Finance Agreement.

Software: any computer software provided by us to enable you to provide us with Electronic Data.

Subsidiary: a subsidiary within the meaning of section 736 Companies Act 1985 and, unless the context otherwise requires, a subsidiary undertaking within the meaning of sections 258-260 Companies Act 1985 as substituted by section 21 Companies Act 1989.

TARGET: the Trans-European Automated Real-time Gross Settlement Express Transfer payment system.

TARGET DAY: any day on which TARGET is open for the settlement of payments in euro.

Term: the Term specified in the Business Finance Agreement.

Termination Service Charge: a charge levied to cover service and administration costs on the occurrence of any Event of Default (other then under item 16 of such definition where all amounts owing to us are repaid pursuant to such change occurring) such charge being five per cent of the aggregate of the (i) Base Currency Equivalent of the total Notified Value of Debts Outstanding plus (ii) if there are any Loan Facilities, the aggregate outstanding balances of all advances made under the Loan Facilities (if any) plus (iii) if there are Trade Finance Facilities, an amount equal to the maximum contingent liability under all Undertakings and all Undertaking Payments made which have not been repaid, in each case calculated as at the date of the Event of Default.

Trade Finance Facility: the trade finance facility, if any, to be made available pursuant to the Business Finance Agreement.

Unapproved Debt: a Debt which we consider is a Debt:

United Kingdom/UK: the United Kingdom of Great Britain and Northern Ireland, the Channel Islands and the Isle of Man.

Page 24

VAT: Value Added Tax.

Working Day: any day (except Saturday and Sunday) on which banks generally are open for business in London and (i) (in relation to any date for the payment or purchase in a currency other than euro) in the principal financial centre of the country of that currency; and (ii) (in relation to any date for the payment or purchase of euro) which is a TARGET Day.

“the Business Finance Agreement”, any “Financing Document” or to any other agreement or document (including, for the avoidance of doubt, the GE Standard Terms and any other document incorporated by reference into the Business Finance Agreement) shall, unless the context otherwise requires, be construed as a reference to the Business Finance Agreement or such other agreement or document as the same may from time to time be amended, varied, supplemented, novated, assigned or replaced and shall include any document which is supplemental to, is expressed to be collateral with, or is entered into pursuant to or in accordance with, the terms of the Business Finance Agreement, such Financing Document or such other agreement or document;

the “assets” of any person shall be construed as a reference to all or any part of its business, operations, undertaking, property, assets (whether tangible or intangible), revenues (including any right to receive revenues) and uncalled capital;

a person being “controlled” by another means that that other (whether directly or indirectly and whether by the ownership of share capital, the possession of voting power, contract or otherwise) has the power to appoint and/or remove all or the majority of the members of the board of directors or other governing body of that person or otherwise controls or has the power to control the affairs and policies of that person and “control” shall be construed accordingly;

a “credit agreement” shall be construed as a reference to any conditional sale agreement (as defined in the Consumer Credit Act 1974), hire purchase or credit sale agreement or other similar agreement entered into primarily as a method of financing the acquisition of the asset which is the subject of such agreement;

“dollars” and “US$” shall mean the lawful currency of the United States of America;

“euro” and

“€” shall be construed as meaning the single currency of the European Union;

a “finance lease” shall be construed as a reference to any lease or other similar agreement entered into primarily as a method of financing the use of the asset which is the subject of such lease or agreement;

a “guarantee” shall be construed so as to include an indemnity, bond, standby letter of credit and any other obligation (whatever called) of any person to pay for, purchase, provide funds for the payment of, indemnify against the consequences of default in the payment of, or otherwise be responsible for, any indebtedness or other obligation of any other person (and “guaranteed” and “guarantor” shall be construed accordingly);

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

a “person” shall be construed as a reference to any individual, firm, company, corporation, public authority, trust, joint venture or any association or partnership (whether or not having separate legal personality) or two or more of the foregoing;

a “regulation” shall be construed so as to include any regulation, rule, by-law, official directive, requirement, request or guideline (whether or not having the force of law) of any governmental body, agency, department or regulatory, self-regulatory or other authority or organisation;

“sterling” and “£” denotes the lawful currency of the United Kingdom;

Page 25

“tax” shall be construed so as to include any present and future tax, levy, impost, deduction, withholding, duty or other charge of a similar nature (including, without limitation, any penalty or interest payable in connection with any failure to pay or any delay in paying any of the same);

“we”, “GE” and “us” shall be construed as referring to GE Commercial Finance Limited and its immediate and derivative successors and assigns, including persons to whom the Business Finance Agreement or any Financing Document may be novated from time to time;

“you” and “Client” shall be construed as having an interchangeable meaning so that “you” shall mean any one or more Clients and vice versa.

You represent and warrant in our favour as follows (and these representations and warranties shall survive the execution of the Financing Documents and will be repeated daily until all outstanding Liabilities under the Financing Documents have been repaid to us in full):

Page 26

Page 27

Page 28

Page 29

Page 30

Page 31

Where any Facility includes payment or receipts in a currency other than euro:

Page 32

We may (and are hereby authorised by you to), at any time and without notice to you, combine and consolidate all or any of your accounts with us and set off any monies which we may at any time hold for your account in or towards satisfaction of any of your Liabilities. We shall not be obliged to exercise any of our rights under this clause which shall be without prejudice to and in addition to any right of set-off or other similar right to which we may at any time be entitled. Where any amounts due by you to us, including those prospectively and contingently due, cannot immediately be ascertained we may make a reasonable estimate.

If we in our sole discretion determine that, as a result of (i) the introduction of, or any change in any law or in any treaty, directive or regulation (whether or not having the force of law) or the interpretation or application thereof or (ii) compliance with any request from or requirement (whether or not having the force of law) of any central bank or other fiscal, monetary or other authority made or imposed after the date hereof:

you shall pay us on demand an amount sufficient to indemnify us against the relevant cost, increased cost, reduction, reduction in the rate of return, payment or forgone interest or other return.

If we in our sole discretion determine that (i) the introduction of, or any change in, any capital adequacy regulation or in the interpretation or application thereof or (ii) compliance by us or any corporation controlling us with any capital adequacy regulation, affects or would affect the amount of capital, reserves or special deposits required or expected to be maintained by us or any corporation controlling us and (taking into consideration our policies or those of any corporation controlling us with respect to capital adequacy and our or their desired return on capital) we determine that the amount of such capital, reserves or special deposits is increased as a consequence of any Facility or other financial commitment or any other obligations under the Business Finance Agreement then, upon our demand you shall pay to us, from time to time as we may specify, additional amounts sufficient to compensate us for such increase.

Page 33

We hereby notify you and any individuals who are directors, partners or shareholders in you and any directors, partners or shareholders of any Associates of our intention, where we consider it necessary, to:

Page 34

Page 35

It may also be handed to any officer of yours. Such notice may also be given by facsimile transmission or electronic medium to your fax number or email address acknowledged by us for communication by such means.

Any Financing Document may be executed in any number of counterparts and by different parties on separate counterparts each of which, when executed and delivered, shall constitute an original and all the counterparts together shall constitute but one and the same instrument.

Page 36

INVOICE FINANCE SCHEDULE

This Schedule sets out the standard terms and conditions relating to any Invoice Finance Facility we may have agreed to make available under the Business Finance Agreement. These terms and conditions apply to all Debts (including Scottish Debts) as are specified in the Business Finance Agreement. We may at any time reduce the scope of the Debts to which the Invoice Finance Facility applies.

The Invoice Finance Facility shall start on the Commencement Date and will run for the Term. After the end of the Term our relationship with you will continue until terminated by either of us by written notice to the other of not less than the Notice Period. Such notice may be given at any time, even during the Term, provided it runs out at or after the end of the Term. During any period of notice you must continue to comply with all your obligations to us, including delivering Notifications to us.

“We hereby guarantee that in relation to the Debts referred to herein the warranties contained in the Business Finance Agreement and the GE Standard Terms between us for the purchase of Debts have been complied with and in particular the Goods and/or services have been delivered and/or fully performed prior to the date hereof”.

The Purchase Price of any Debts purchased by us will be the Notified Value of such Debt less any Discount, Service Charge and the amount of any other Liabilities, adjusted to take account of:

Page 37

Page 38

The provisions of this paragraph 8 apply so long as the nature of the Invoice Finance Facility, in relation to any Debts or Debtors, is for the provision of confidential invoice finance on an undisclosed agency basis (and we undertake not to alter the undisclosed agency basis of this facility without your prior written consent or unless in our reasonable opinion and acting in good faith a Default has occurred. In either case, we shall notify you of any such disclosure promptly thereafter.).

Whilst such basis continues:

Page 39

Subject to our undertaking in clause 8 above, we may at any time require, in relation to any Debts and Debtors, that all or part of the Invoice Finance Facility shall be operated on a disclosed basis. If we do so require or it is otherwise agreed between us that all or part of the Invoice Finance Facility shall be operated on a disclosed basis the following provisions shall apply:

This paragraph 10 comes into effect on the cancellation of your agency under paragraph 8.5 so as to vary the relevant provisions of paragraph 8. After such cancellation of your agency to administer accounts or collect Debts:

Page 40

If it is agreed that the Invoice Finance Facility includes payment in a currency other than euro:

Page 41

Page 42

In respect of each Notified Debt you will be deemed to have given the following warranties to us both at the date of Notification and at all other times whilst such Debt is Outstanding:

In respect of Export Debts, you shall be deemed to have given the following additional warranties at the same times as specified in paragraph 14.1:

Page 43

In respect of Debts generally, you undertake:

Page 44

The following additional provisions apply in respect of Export Debts:

Page 45

and at any time, any other information we may ask for.

Page 46

Upon or at any time after an Event of Default, in addition to all our other rights under any of the Financing Documents, we may, with or without notice to you, do any or all of the following:

Page 47

and at any time after termination of the Invoice Finance Facility after the occurrence of an Event of Default:

Such rights and obligations (including the continuation of the Discount, if applicable) shall remain in full force and effect until all monies due from you shall have been received by us and all monies due from us to you shall have been paid.

INVOICE FINANCE SCHEDULE - ANNEX A COLLECTION SERVICES

This section has been deliberately omitted.

INVOICE FINANCE SCHEDULE - ANNEX B PARTNERSHIP

This section has been deliberately omitted.

INVOICE FINANCE SCHEDULE - ANNEX C SOLE TRADER

This section has been deliberately omitted.

Page 48

CREDIT PROTECTION SCHEDULE

Agreed Percentage: in relation to any Approved Credit Protected Debt, the agreed percentage thereof which is covered on the Insolvency of any relevant Debtor as specified in the Business Finance Agreement.

Approved Credit Protected Debt: a Credit Protected Debt or that part of a Credit Protected Debt of a Debtor, the Notified Value of which, when aggregated with the Debtor Balance at any time, does not exceed the relevant Credit Limit and which is not and has not become Unapproved, and “Approved” shall be construed accordingly. No Credit Protected Debt, the Notified Value of which is the First Loss Amount (if any) or less shall be an Approved Credit Protected Debt and that part of any other Credit Protected Debt which is equal to the First Loss Amount (if any) shall likewise not be Approved.

Credit Decision Advice: a notice from us to you setting out the agreed Credit Limit in respect of Debtors and other relevant information.

Credit Limit: in respect of any Debtor whose Debts you wish to become Credit Protected Debts, such credit limit as may be established by us by a Credit Decision Advice given to you or, if you have been given Discretionary Limit Approval, the Discretionary Limit.

Credit Protected Debt: if we have agreed to provide Credit Protection, each Debt due from a Debtor, not being an Unapproved Debt or a Non-Notifiable Debt, in respect of which we have established a Credit Limit.

Credit Protection Application: an application by you for Debts to become Credit Protected Debts in a form specified by us and setting out:

Credit Terms for Discretionary Approval: the credit terms specified in the Business Finance Agreement that the credit terms of all Debts subject to Discretionary Limit Approval should not exceed.

Discretionary Limit: the financial limits set out as the discretionary limit in the Business Finance Agreement (if any) or in any discretionary approval letter from us to you.

Discretionary Limit Approval: if provided for in the Business Finance Agreement or a subsequent discretionary approval letter from us to you, authority to establish credit limits yourself up to the Discretionary Limit to enable Debts of certain Debtors to become Credit Protected Debts under the terms set out in the Business Finance Agreement, this Schedule and in any discretionary approval letter.

Page 49

First Loss Amount: the amount (if any) specified as such in the Business Finance Agreement being the first loss amount up to which Credit Protected Debts of any Debtor shall not be Approved Credit Protected Debts.

Minimum Threshold for Discretionary Approval: the minimum threshold for Debts (if any) set out in the Business Finance Agreement, below which the Discretionary Limit shall not apply.

Unapproved Credit Protected Debt: a Credit Protected Debt purchased by us:

and “Unapproved” shall be construed accordingly.

Page 50

Credit Protected Debts within a relevant Credit Limit will, unless they are otherwise Unapproved, become Approved Credit Protected Debts in the order in which they are Notified to us. When any Remittance is received by us, that may enable Unapproved Credit Protected Debts (or parts thereof) to become Approved Credit Protected Debts.

we shall within sixty days of satisfaction of (a), (b) and (c) above credit to the Current Account an amount equal to the Agreed Percentage of the amount of such Approved Credit Protected Debt minus an amount equal to the aggregate of (i) the VAT element thereof, (ii) any Discount or Service Charges to the extent not so far debited and (iii) for the avoidance of doubt, the First Loss Amount (if any).

Unless otherwise specifically indicated by any Debtor and subject to the exceptions mentioned below, any payments made by that Debtor shall be deemed to be in settlement of the Approved part of the relevant Debtor Balance before the Unapproved part. If a Debtor has become Insolvent, payments made by that Debtor or any liquidator or other legal representative of it (as the case may be) shall be deemed to be apportioned in settlement of the Approved part and the Unapproved part of the Debtor Balance pro-rata in the proportion that each bears to the other.

You shall (without limitation to your other obligations):

Page 51

Fees calculated in accordance with the provisions of the Business Finance Agreement will be payable by you in respect of each Credit Protection Application and as additional Service Charge calculated on the Notified Value of all Debts and will be debited to your Current Account.

If you have been given Discretionary Limit Approval by us, the following additional provisions shall apply:

Page 52

Page 53

PLANT AND MACHINERY SCHEDULE

Eligible Plant and Machinery: such of a Client’s Plant and Machinery as we may from time to time advise such Client as being taken into consideration by us for the purposes of the Business Finance Agreement which shall, until further notice from us, include that Plant and Machinery detailed in the Business Finance Agreement.

Plant and Machinery Facility Default Rate: the rate of four per cent above the Plant and Machinery Facility Interest Rate.

Plant and Machinery Facility Final Drawdown Date: in relation to each Client, the Final Drawdown Date specified as such in the Business Finance Agreement as the date by which all Plant and Machinery Term Loan Advances to that Client under the Plant and Machinery Term Loan Facility must be drawn down.

Plant and Machinery Facility Interest Rate: the rate specified in the Business Finance Agreement as the Interest Rate applicable to any Plant and Machinery Term Loan Advance.

Plant and Machinery Term Loan Advance: the principal amount of each advance made under the Plant and Machinery Term Loan Facility as from time to time reduced by repayment or prepayment.

Plant and Machinery Term Loan Advance Limit: the plant and machinery Loan Advance Limit set out in the Business Finance Agreement against Plant and Machinery.

Plant and Machinery Term Loan Advance Percentage: the plant and machinery Loan Advance Percentage set out in the Business Finance Agreement against Plant and Machinery.

Plant and Machinery Term Loan Cancellation Date: the earlier of the date on which the Business Finance Agreement is terminated for any reason or:

Plant and Machinery Valuation: in relation to a Client’s assets forming part of the Eligible Plant and Machinery, a valuation of those assets in such form and prepared on such basis and by such person as specified in the Business Finance Agreement or as we shall at any time require.

Page 54

If the Business Finance Agreement specifies that we will make available to you a Plant and Machinery Term Loan Facility, we will make available to you such Plant and Machinery Term Loan Facility in respect of your Eligible Plant and Machinery up to a principal amount which may not at any time exceed (i) the Plant and Machinery Term Loan Advance Limit or (ii) an amount equal to the Plant and Machinery Term Loan Advance Percentage of the value of your Eligible Plant and Machinery from time to time (as evidenced by the most recently delivered Plant and Machinery Valuation) less such of the Eligible Plant and Machinery or its proceeds of sale as we may from time to time reasonably determine might be unavailable to us upon enforcement of any of the Financing Documents and such other reserves as we are entitled to make hereunder.

Page 55

We shall be entitled (and are hereby authorised by you) to debit all payments due under the Plant and Machinery Term Loan Facility to any Current Account or any other account(s) of yours with us.

Page 56

Upon or at any time after an Event of Default, in addition to all our other rights under any of the Financing Documents, we may declare, by written notice to you,

In addition to the indemnities in clause 10 of the GE Standard Terms and those indemnities elsewhere in the Financing Documents, you will fully indemnify us against any funding and all other losses, costs, demands and expenses or liabilities (including legal and other professional fees) which we may sustain directly or indirectly as a result of:

Page 57

REAL PROPERTY SCHEDULE

Eligible Real Property: such of a Client’s Real Property as we may from time to time advise such Client as being taken into consideration by us for the purposes of the Business Finance Agreement which shall, until further notice from us, include that Real Property detailed in the Business Finance Agreement.

Real Property Facility Default Rate: the rate of four per cent above the Real Property Facility Interest Rate.

Real Property Facility Final Drawdown Date: in relation to each Client, the Final Drawdown Date specified as such in the Business Finance Agreement as the date by which all Real Property Term Loan Advances to that Client under the Real Property Term Loan Facility must be drawn down.

Real Property Facility Interest Rate: the rate specified in the Business Finance Agreement as the Interest Rate applicable to any Real Property Term Loan Advance.

Real Property Term Loan Advance: the principal amount of each advance made under the Real Property Term Loan Facility as from time to time reduced by repayment or prepayment

Real Property Term Loan Advance Limit: the real property Loan Advance Limit set out in the Business Finance Agreement against Real Property.

Real Property Term Loan Advance Percentage: the real property Loan Advance Percentage set out in the Business Finance Agreement against Real Property.

Real Property Term Loan Cancellation Date: the earlier of the date on which the Business Finance Agreement is terminated for any reason or:

Real Property Valuation: in relation to a Client’s assets forming part of the Eligible Real Property, a valuation of those assets in such form and prepared on such basis and by such person as we shall at any time require.

Page 58

If the Business Finance Agreement specifies that we will make available to you a Real Property Term Loan Facility, we will make available to you such Real Property Term Loan Facility in respect of your Eligible Real Property up to a principal amount which may not at any time exceed (i) the Real Property Term Loan Advance Limit or (ii) an amount equal to the Real Property Term Loan Advance Percentage of the value of your Eligible Real Property from time to time (as evidenced by the most recently delivered Real Property Valuation) less, in each such case, such of the Eligible Real Property or its proceeds of sale as we may from time to time reasonably determine might be unavailable to us upon enforcement of any of the Financing Documents and such other reserves as we are entitled to make hereunder.

Page 59

We shall be entitled (and are hereby authorised by you) to debit all payments due under the Real Property Term Loan Facility to any Current Account or any other account(s) of yours with us.

Upon or at any time after an Event of Default, in addition to all our other rights under any of the Financing Documents, we may declare by written notice to you:

Page 60

In addition to the indemnities in clause 10 of the GE Standard Terms and those indemnities elsewhere in the Financing Documents, you will fully indemnify us against any funding and all other losses, costs, demands and expenses or liabilities (including legal and other professional fees) which we may sustain directly or indirectly as a result of: