H.E.A.T Mezzanine S.A. - Offering Circular _Version 9_

H.E.A.T MEZZANINE S.A.
(a société anonyme incorporated under the laws of Luxembourg
having its registered office at 1-7 rue Nina et Julien Lefèvre, L-1952 Luxembourg, registered with the Luxembourg
Trade and Companies Register under number B-109.738)
218,400,000 Class A Compartment 2 Floating Rate Notes due 2014
30,800,000 Class B Compartment 2 Floating Rate Notes due 2014
30,800,000 Junior Compartment 2 Notes due 2014
H.E.A.T Mezzanine S.A. (the "Issuer"), a securitisation vehicle established under the Luxembourg
securitisation law of 22 March 2004, will issue the 218,400,000 Class A Compartment 2 Floating Rate Notes
in a denomination of €50,000 each (the "Class A Notes"), the 30,800,000 Class B Compartment 2 Floating
Rate Notes in a denomination of €50,000 each (the "Class B Notes") and the Class B Notes together with the
Class A Notes, the "Senior Notes") and the €30,800,000 Junior Compartment 2 Notes in a denomination of
€50,000 each (the "Junior Notes" and, together with the Senior Notes, the "Compartment 2 Notes "). The
Class A Notes and the Class B Notes are together referred to as the "Floating Rate Notes".
The issue price of the Class A Notes is 100 per cent. of their initial principal amount. The issue price of the
Class B Notes is 100 per cent. of their initial principal amount. The issue price of the Junior Notes is 100 per
cent. of their initial principal amount (the "Junior Notional Amount").
Application has been made to the Irish Financial Services Regulatory Authority, as competent authority
under Directive 2003/71/EC, for the Offering Circular to be approved. Such approval relates only to the
Compartment 2 Notes which are to be admitted to trading on the regulated market of the Irish Stock
Exchange or other regulated markets for the purposes of Directive 93/22/EEC or which are to be offered to
the public in any Member State of the European Economic Area. Application has been made to the Irish
Stock Exchange for the Compartment 2 Notes to be admitted to the Official List of the Irish Stock Exchange
and trading on its regulated market.
This Offering Circular comprises a prospectus for the purposes of Directive 2003/71/EC.
The Issuer expects that, upon issuance, the Class A Notes will be assigned a rating of "Aaa" by Moody's
Investors Service, Inc. ("Moody's") and the rating of "AAA" by Fitch Ratings Ltd. ("Fitch") (together with
Moody's, the "Rating Agencies"), and that, upon issuance, the Class B Notes will be assigned a rating of at
least "A1" by Moody's and a rating of "A+" by Fitch. A rating is not a recommendation to buy, sell or hold
securities, and may be subject to revision, suspension or withdrawal at any time by Moody's. The Junior
Notes will not be rated.
The Class A Notes, the Class B Notes and the Junior Notes will each be initially represented by a temporary
global note in bearer form without coupons (each, a "Temporary Global Note" and, together, the
"Temporary Global Notes"). The Temporary Global Note for each of the Class A Notes, the Class B Notes
and the Junior Notes will be deposited on or about the Issue Date with a common depositary for Euroclear
Bank S.A./N.V. as operator of the Euroclear System ("Euroclear") and Clearstream Banking, société
anonyme ("Clearstream, Luxembourg") where the Class A Notes, the Class B Notes and the Junior Notes
have been accepted for clearance. It is expected that delivery of the Class A Notes, the Class B Notes and
the Junior Notes will be made through Euroclear and Clearstream, Luxembourg against payment therefor in
immediately available funds on or about the Issue Date. Each Temporary Global Note will be exchangeable
(in whole or in part) not earlier than 40 days after the Issue Date for a permanent global note in bearer form
without coupons (each, a "Permanent Global Note" and, together, the "Permanent Global Notes" and, the
Temporary Global Notes and the Permanent Global Notes together, the "Global Notes" and each a "Global
Note") upon certification as to non-U.S. beneficial ownership. In certain limited circumstances, beneficial
interests in the permanent global notes in bearer form without coupons will be exchangeable for
Compartment 2 Notes in definitive bearer form ("Definitive Notes").
HSBC Bank plc
The date of this Offering Circular is 27 April 2006
HSBC Trinkaus & Burkhardt KGaA
The Issuer will pay (contingent upon the receipt by it of certain amounts as described below), for the
period from (and including) 13 April 2006 (the "Issue Date") to (but excluding) 13 April 2014 (the
"Legal Maturity Date"), floating interest on the Class A Notes (the "Class A Coupon Payments")
calculated semi-annually at the European Inter-Bank Offered Rate ("EURIBOR") for six month
deposits in euro plus a margin of 0.33 per cent. per annum (the "Class A Margin") of the principal
amount per Class A Note outstanding from time to time, as determined in accordance with the terms
and conditions of the Compartment 2 Notes. Class A Coupon Payments will be payable semi-annually
in arrear on 13 April and 13 October of each year, commencing on 13 October 2006 up to and
including the Legal Maturity Date (each such date, or, if such date is not a Business Day (as defined
below), the next following Business Day, a "Payment Date").
The Issuer will pay (contingent upon the receipt by it of certain amounts as described below), for the
period from (and including) the Issue Date to (but excluding) the Legal Maturity Date, floating interest
on the Class B Notes (the "Class B Coupon Payments" and the Class A Coupon Payments and the
Class B Coupon Payments, collectively, the "Floating Senior Coupon Payments") calculated semiannually at EURIBOR for six month deposits in euro plus a margin of 0.83 per cent. per annum (the
"Class B Margin") of the principal amount per Class B Note outstanding from time to time, as
determined in accordance with the terms and conditions of the Compartment 2 Notes. Class B Coupon
Payments will be payable semi-annually in arrear on each Payment Date.
The Issuer will pay (contingent upon the receipt by it of certain amounts as described below), for the
period from (and including) the Issue Date to (but excluding) the Legal Maturity Date, fixed interest on
the Junior Notes (the "Junior Coupon Payments" and, together with the Floating Senior Coupon
Payments, collectively, the "Coupon Payments") calculated initially at a rate of 17.15 per cent. per
annum of the Junior Notional Amount and increasing on each Payment Date in accordance with a
schedule (the "Junior Coupon Rate Schedule") attached to the terms and conditions of the
Compartment 2 Notes, as determined in accordance with the terms and conditions of the Compartment
2 Notes. Junior Coupon Payments will be payable semi-annually in arrear on each Payment Date
commencing on 13 October 2006.
Class
Initial
Principal
Amount
Interest Rate
Issue Price
Expected
Ratings
(Moody's)
Expected
Ratings
(Fitch)
Scheduled
Redemption
Date
Legal Maturity
Date
ISIN
A Compartment 2
218,400,000
Aaa
AAA
13 April 2013
13 April 2014
XS0251292883
30,800,000
100%
A1
A+
13 April 2013
13 April 2014
XS0251293261
Junior
Compartment 2
30,800,000
EURIBOR
+0.33%
EURIBOR
+0.83%
Initially 17.15%
increasing
thereafter as per
schedule
100%
B Compartment 2
100%
Not rated
Not rated
13 April 2013
13 April 2014
XS0251293857
On each Payment Date during the period from (and including) the Issue Date to (but excluding) 13
April 2013 (the "Scheduled Redemption Date"), (or, if earlier, until the Class A Notes have been
redeemed in full), the Issuer will pay (contingent upon the receipt by it of certain amounts as described
below), in redemption of the Outstanding Principal Amount of the Class A Notes, the amount (the
"Class A Amortisation Amount") corresponding to such date specified in a schedule to the terms and
conditions of the Compartment 2 Notes (the "Class A Amortisation Schedule").
On or after the Scheduled Redemption Date the Issuer will (contingent on the receipt by it of certain
amounts as described below and subject to and in accordance with the Priority of Payments), (a) pay its
operating expenses and Coupon Payments which are then due and payable and (b) redeem the Class A
Notes, the Class B Notes and the Junior Notes at an amount equal to (i) in the case of the Class A Notes
and the Class B Notes, their initial principal amount and (ii) in the case of the Junior Notes, the amount
(the "Junior Redemption Amount") corresponding to the date of redemption as specified in a
schedule (the "Junior Redemption Amount Schedule") attached to the terms and conditions of the
relevant Compartment 2 Notes, in each case less any payments made for the redemption of the relevant
Compartment 2 Notes since the Issue Date (such amount, for each Compartment 2 Note, its
"Outstanding Principal Amount").
The Class A Notes will rank pari passu and rateably without any preference among themselves and
senior in priority to the Class B Notes and the Junior Notes. The Class B Notes will rank pari passu
and rateably without any preference among themselves and senior in priority to the Junior Notes but
junior in priority to the Class A Notes. The Junior Notes will rank pari passu and rateably without any
i
preference among themselves and junior in priority to the Class A Notes and the Class B Notes. See
"Terms and Conditions of the Compartment 2 Notes".
The Compartment 2 Notes will have the benefit of certain collateral comprised of (i) (A) claims for the
payment of fixed quarterly interest (the "Fixed Interest Payments") and (B) repayment of principal
arising under profit participation agreements (the "Profit Participation Agreements") entered into on
or before the Issue Date with certain small and medium sized private companies located in Germany
and incorporated under German law (the "Private Portfolio Companies"), (ii) (A) claims for the
payment of quarterly fixed interest (the "Interest Payments" and, together with the Fixed Interest
Payments, the "Quarterly Payments") and (B) principal arising under subordinated loan agreements
(the "Subordinated Loan Agreements" and, together with the Profit Participation Agreements, the
"Financing Agreements") entered into on or before the Issue Date with certain small and medium
sized private companies located in Germany and incorporated under German law (the "Public
Portfolio Companies" and, together with the Private Portfolio Companies, the "Portfolio
Companies") and (iii) claims arising on account of Recoveries (as defined below).
The identity and certain characteristics of the Portfolio Companies are described in "The Portfolio
Companies" below. Notwithstanding that each Financing Agreement shall be expressed to be
perpetual, each Financing Agreement may be terminated early by the Issuer. Under the Trust Deed, the
Issuer has covenanted to terminate each Profit Participation Agreement early in accordance with the
notice provisions set out therein so that the effective date of termination thereof (the "End Date") is the
anniversary in 2013 of the Commencement Date (as defined herein) and each Portfolio Company shall
be required to repay the relevant Advance in full on the End Date. See "Description of the Other
Transaction Documents - Terms and Conditions of the Profit Participation Agreements" and "- Terms
and Conditions of the Subordinated Loan Agreements".
Payment by the Issuer of principal and interest on the Compartment 2 Notes is conditional upon
the performance by the Portfolio Companies of their obligations under the Financing
Agreements. Holders of the Compartment 2 Notes from time to time (the "Compartment 2
Noteholders") will be exposed to the credit risk of the Portfolio Companies and there is no
certainty that the Compartment 2 Noteholders will receive the full principal amount of their
Compartment 2 Note or interest thereon. See "Risk Factors" and "Terms and Conditions of the
Compartment 2 Notes". The Issuer shall have no assets available for payment of the principal of,
and interest on, the Compartment 2 Notes other than Available Distribution Funds (as defined
below) actually received and available for distribution prior to the applicable Payment Date.
Claims in respect of any shortfall will be payable on each following Payment Date until paid in
full and failure by the Issuer to make payment in respect of any such shortfall will not constitute
a default by the Issuer for any purpose. Any Coupon Payments so deferred will not earn interest.
Claims in respect of any shortfall on the Legal Maturity Date shall be extinguished and failure by
the Issuer to make payment in respect of any such shortfall will not constitute a default by the
Issuer for any purpose.
Investing in the Compartment 2 Notes involves certain risks which affect payment of principal
and interest on the Compartment 2 Notes. Please review the section entitled "Risk Factors" of
this offering circular (the "Offering Circular").
Pursuant to a trust deed to be entered into on the Issue Date (the "Trust Deed") between, among others,
the Issuer and BNP Paribas Trust Corporation UK Limited as trustee (the "Trustee"), the Issuer has in
favour of the Trustee for the benefit of the Secured Parties: (i) assigned by way of security all right,
title and interest of the Issuer in respect of the Profit Participation Agreements, the Subordinated Loan
Agreements, the Loan Agreement and the Permitted Investments from time to time (where such rights
are contractual rights) including, without limitation, all moneys received in respect thereof, all
dividends and distributions paid or payable thereon, all property paid, distributed, accruing or offered at
any time on, to or in respect of or in substitution therefor and the proceeds of sale, repayment and
redemption thereof, (ii) for the purposes of German law and to the maximum extent permitted under
the terms of the Profit Participation Agreements and the Subordinated Loan Agreements, has assigned
by way of security all right, title and interest of the Issuer in respect to the Profit Participation
Agreements and the Subordinated Loan Agreements, including, without limitation, all moneys received
in respect thereof, all dividends and distributions paid or payable thereon, all property paid, distributed,
accruing or offered at any time on, to or in respect of or in substitution therefor and the proceeds of
sale, repayment and redemption thereof (iii) charged by way of a first fixed charge and first priority
ii
security interest all right, title and interest of the Issuer in respect of all Permitted Investments from
time to time (where such rights are securities) including, without limitation, all moneys received in
respect thereof, all dividends and distributions paid or payable thereon, all property paid, distributed,
accruing or offered at any time on, to or in respect of or in substitution therefor and the proceeds of
sale, repayment and redemption thereof, (iv) charged by way of a first fixed charge and first priority
security interest all right, title and interest of the Issuer in respect of the Accounts and all moneys from
time to time standing to the credit of the Accounts and including, without limitation, all interest
accrued and other moneys received in respect thereof, (v) charged by way of a first fixed charge and
first priority security interest all right, title and interest of the Issuer in respect of the Custody Accounts
(including each cash account relating to the Custody Accounts, any cash held therein and the debt
represented thereby), (vi) charged by way of a first fixed charge and first priority security interest all
moneys held from time to time by the Paying Agents for the payment of principal interest or other
amounts under the Compartment 2 Notes if any, (vii) assigned by way of security all of the Issuer's
right, title and interest, present and future, under the Cash Administration Agreement, (viii) assigned by
way of security all of the Issuer's right, title and interest, present and future under the Asset Sale and
Transfer Agreement, (ix) assigned by way of security all of the Issuer's right, title and interest, present
and future, under the Recovery Management Agreement, (x) assigned by way of security all of the
Issuer's right, title and interest, present and future, under the Paying Agency Agreement, (xi) assigned
by way of security all of the Issuer's right, title and interest, present and future, under the Investment
Advisory Agreement, (xii) assigned by way of security all of the Issuer's right, title and interest, present
and future, under the Swap Agreement (including the Issuer's rights under any guarantee or credit
support annex entered into pursuant to the Swap Agreement provided that such assignment by way of
security shall not in any way restrict the release of Compartment 2 Collateral granted thereunder in
whole or in part at any time pursuant to the terms thereof), and (xiii) charged by way of a floating
charge all of the Compartment 2 undertaking and assets to the extent that such undertaking and assets
are not subject to any other security referred to in paragraphs (i) to (xii) above.
Pursuant to two Luxembourg pledge agreements to be entered into on or before the Issue Date (the
"Luxembourg Pledge Agreements") each to be entered into between the Issuer and the Trustee, the
Issuer has in favour of the Trustee for the benefit of the Secured Parties pledged all right, title and
interest of the Issuer in respect of the Permitted Investments, the Custody Accounts and the Accounts.
HSBC BANK PLC AND HSBC TRINKAUS & BURKHARDT KGAA ("TRINKAUS") IN THEIR
RESPECTIVE CAPACITIES AS INITIAL PURCHASERS (THE "INITIAL PURCHASERS")
HAVE REPRESENTED AND WARRANTED TO, AND AGREED WITH, THE ISSUER THAT
THE COMPARTMENT 2 NOTES HAVE NOT AND WILL NOT BE OFFERED OR SOLD IN OR
FROM LUXEMBOURG OTHER THAN IN ACCORDANCE WITH THE REQUIREMENTS OF
LUXEMBOURG LAW CONCERNING PUBLIC OFFERINGS OF SECURITIES. NO
ADVERTISEMENT, DOCUMENT OR OTHER MATERIAL HAS OR WILL BE DISTRIBUTED
TO THE PUBLIC OR PUBLISHED IN LUXEMBOURG.
THE INITIAL PURCHASERS REPRESENTED AND WARRANTED TO, AND AGREED WITH,
THE ISSUER THAT THEY HAVE NOT OFFERED OR SOLD AND WILL NOT OFFER OR SELL
ANY COMPARTMENT 2 NOTES IN GERMANY OTHER THAN IN ACCORDANCE WITH THE
PROVISIONS OF THE GERMAN SECURITIES PROSPECTUS ACT (WERTPAPIER VERKAUFSPROSPEKTGESETZ) AND ANY OTHER LEGAL AND REGULATORY
REQUIREMENTS APPLICABLE IN GERMANY GOVERNING THE ISSUE, OFFERING AND
SALE OF SECURITIES. FOR A DESCRIPTION OF FURTHER RESTRICTIONS ON OFFERS
AND SALES OF THE COMPARTMENT 2 NOTES AND DISTRIBUTION OF THIS OFFERING
CIRCULAR, SEE "SUBSCRIPTION AND SALE".
In connection with this issue, HSBC Bank plc may, to the extent permitted by applicable laws,
over-allot or effect transactions with a view to supporting the market price of the Compartment 2
Notes at a level higher than that which might otherwise prevail. However, there is no assurance
that HSBC Bank plc will undertake stabilisation action. Any stabilising action may begin on or
after the date on which adequate public disclosure of the terms of the offer of the relevant class of
Compartment 2 Notes is made and, if begun, may be ended at any time, but it must end no later
than the earlier of 30 days after the issue date of the relevant class of Compartment 2 Notes and
60 days after the date of the allotment of the relevant class of Compartment 2 Notes.
iii
The Issuer accepts responsibility for the information contained in this Offering Circular other than the
Portfolio Information, the Trustee Information, the Cash Administrator Information, the Swap
Counterparty Information, the Transaction Adviser Information and the Recovery Manager Information
(each as defined below). To the best of the knowledge and belief of the Issuer (which has taken all
reasonable care to ensure that such is the case), the information contained in this Offering Circular
(other than the Portfolio Information, the Trustee Information, the Cash Administrator Information, the
Swap Counterparty Information, the Transaction Adviser Information and the Recovery Manager
Information) is in accordance with the facts and does not omit anything likely to affect the import of
such information.
Each Portfolio Company accepts responsibility for the information contained in this Offering Circular
relating to itself. Such information includes, without limitation, the matters set out in "The Portfolio
Companies" and the description of the rights and obligations of each Portfolio Company under, and all
information relating to, (i) in the case of each Private Portfolio Company the Profit Participation
Agreements, including, without limitation, the matters set out in "Description of the Other Transaction
Documents – Terms and Conditions of the Profit Participation Agreements" and (ii) in the case of each
Public Portfolio Company, the Subordinated Loan Agreements, including without limitation, the
matters set out in the "Description of the Other Transaction Documents – Terms and Conditions of the
Subordinated Loan Agreements". In addition, each Portfolio Company has represented that, to the best
of its knowledge and belief (having taken all reasonable care to ensure that such is the case), such
information (the "Portfolio Information") is in accordance with the facts and does not omit anything
likely to affect the import of such information. No representation, warranty or undertaking, express or
implied, is made and no responsibility or liability is accepted by any Portfolio Company as to the
accuracy or completeness of any information contained in this Offering Circular (other than the
Portfolio Information) or any other information supplied in connection with the Compartment 2 Notes
or their sale.
The Trustee accepts responsibility for the information in this Offering Circular relating to itself set out
in "The Trustee" (the "Trustee Information"). To the best of the Trustee's knowledge and belief
(having taken all reasonable care to ensure that such is the case), the Trustee Information is in
accordance with the facts and does not omit anything likely to affect the import of such information.
No representation, warranty or undertaking, express or implied, is made and no responsibility or
liability is accepted by the Trustee as to the accuracy or completeness of any information contained in
this Offering Circular (other than the Trustee Information) or any other information supplied in
connection with the Compartment 2 Notes or their sale.
BNP Paribas Securities Services, Luxembourg branch (the "Cash Administrator") accepts
responsibility for the information in this Offering Circular relating to itself set out in "The Cash
Administrator" (the "Cash Administrator Information"). To the best of the Cash Administrator's
knowledge and belief (having taken all reasonable care to ensure that such is the case), the Cash
Administrator Information is in accordance with the facts and does not omit anything likely to affect
the import of such information. No representation, warranty or undertaking, express or implied, is
made and no responsibility or liability is accepted by the Cash Administrator as to the accuracy or
completeness of any information contained in this Offering Circular (other than the Cash Administrator
Information) or any other information supplied in connection with the Compartment 2 Notes or their
sale.
HSBC Bank plc (the "Swap Counterparty") accepts responsibility for the information in this Offering
Circular relating to itself set out in "The Swap Counterparty" (the "Swap Counterparty
Information"). To the best of the Swap Counterparty's knowledge and belief (having taken all
reasonable care to ensure that such is the case), the Swap Counterparty Information is in accordance
with the facts and does not omit anything likely to affect the import of such information. No
representation, warranty or undertaking, express or implied, is made and no responsibility or liability is
accepted by the Swap Counterparty as to the accuracy or completeness of any information contained in
this Offering Circular (other than the Swap Counterparty Information) or any other information
supplied in connection with the Compartment 2 Notes or their sale.
HSBC Trinkaus & Burkhardt KGaA (the "Transaction Adviser") accepts responsibility for the
information in this Offering Circular relating to itself set out in "The Transaction Adviser" (the
"Transaction Adviser Information"). To the best of the Transaction Adviser's knowledge and belief
(having taken all reasonable care to ensure that such is the case), the Transaction Adviser Information
iv
is in accordance with the facts and does not omit anything likely to affect the import of such
information. No representation, warranty or undertaking, express or implied, is made and no
responsibility or liability is accepted by the Transaction Adviser as to the accuracy or completeness of
any information contained in this Offering Circular (other than the Transaction Adviser Information) or
any other information supplied in connection with the Compartment 2 Notes or their sale.
mbb Consult GmbH (the "Recovery Manager") accepts responsibility for the information in this
Offering Circular relating to itself set out in "The Recovery Manager" (the "Recovery Manager
Information"). To the best of the Recovery Manager's knowledge and belief (having taken all
reasonable care to ensure that such is the case), the Recovery Manager Information is in accordance
with the facts and does not omit anything likely to affect the import of such information. No
representation, warranty or undertaking, express or implied, is made and no responsibility or liability is
accepted by the Recovery Manager as to the accuracy or completeness of any information contained in
this Offering Circular (other than the Recovery Manager Information) or any other information
supplied in connection with the Compartment 2 Notes or their sale.
In connection with the issue and sale of the Compartment 2 Notes, no person is authorised to give any
information or to make any representation not contained in this Offering Circular and in the documents
referred to herein, which are made available for inspection by the public and, if given or made, such
information or representation must not be relied upon as having been authorised by the Issuer, the
Initial Purchasers, the Portfolio Companies, the Transaction Adviser, the Recovery Manager, the Cash
Administrator, the Swap Counterparty or the Trustee.
The Initial Purchasers have not separately verified the information in this Offering Circular and
accordingly the Initial Purchasers do not make any representation or warranty, express or implied,
regarding the accuracy, adequacy, reasonableness or completeness of the information contained in this
Offering Circular or accept any responsibility or liability therefor. None of the Initial Purchasers or
their affiliates undertakes to review the financial condition or affairs of the Issuer or the Portfolio
Companies during the life of the arrangements contemplated by this Offering Circular nor to advise any
potential investor or investor of any information coming to the attention of the Initial Purchasers. Each
person receiving this Offering Circular acknowledges that such person has not relied on the Initial
Purchasers or their affiliates in connection with making its decision to invest in the Compartment 2
Notes. Each person contemplating making an investment in any Compartment 2 Notes must make its
own determination of the suitability of any such investment with particular reference to its own
investment objectives.
Prospective investors should satisfy themselves that they understand all of the risks associated with
making investments in the Compartment 2 Notes. Any individual intending to invest in any investment
described in this Offering Circular should consult his professional adviser and ensure that he fully
understands all the risks associated with making such an investment and has sufficient financial
resources to sustain any loss that may arise from it.
Nothing in this Offering Circular or anything communicated to holders of, or investors in, the
Compartment 2 Notes (or any such potential holders or investors) is intended to constitute, or should be
construed as, advice on the merits of the purchase of, or subscription for, the Compartment 2 Notes or
the exercise of any rights attached thereto. An investment in the Compartment 2 Notes is suitable only
for financially sophisticated investors who are capable of fully evaluating the risks involved in making
such investments and who have an asset base which is sufficiently substantial as to enable them to
sustain any loss that they might suffer as a result of making such investments.
Prospective investors should inform themselves as to the legal requirements and tax consequences
within the countries of their residence and domicile for the acquisition, holding or disposal of the
Compartment 2 Notes and any foreign exchange restrictions that might be relevant to them. This
Offering Circular does not constitute an offer of, or an invitation by or on behalf of, the Issuer, the
Portfolio Companies or the Initial Purchasers to subscribe for or to purchase any of the Compartment 2
Notes. This Offering Circular is not intended to provide the basis of any credit or other evaluation and
should not be considered as a recommendation by the Issuer, the Portfolio Companies or the Initial
Purchasers that any recipient of this Offering Circular should purchase any of the Compartment 2
Notes. Prospective investors may not construe the contents of this Offering Circular as legal, economic,
investment, accounting, tax or other advice. If in doubt, a potential investor should consult with and
rely on its own professional advisors. Each investor contemplating purchasing Compartment 2 Notes
v
should make its own independent investigation of the financial condition and affairs, and its own
appraisal of the creditworthiness, of the Issuer and the Portfolio Companies.
The distribution of this Offering Circular and the offering or sale of the Compartment 2 Notes in
certain jurisdictions may be restricted by law. None of the Issuer, the Portfolio Companies or the Initial
Purchasers represents that this document may be lawfully distributed, or that the Compartment 2 Notes
may be lawfully offered, in compliance with any applicable registration or other requirements in any
such jurisdiction, or pursuant to an exemption available thereunder, or assume any responsibility for
facilitating any such distribution or offering. In particular, none of the Issuer, the Portfolio Companies
or the Initial Purchasers has taken any action which would permit a public offering of the Compartment
2 Notes or distribution of this document in any jurisdiction where action for that purpose is required.
Accordingly, no Compartment 2 Notes may be offered or sold, directly or indirectly, and neither this
Offering Circular nor any advertisement or other offering material may be distributed or published in
any jurisdiction, except under circumstances that will result in compliance with any applicable laws
and regulations. Persons into whose possession this Offering Circular or the Compartment 2 Notes may
come must inform themselves about and observe any such restrictions (see "Subscription and Sale" for
a description of certain restrictions on offers, sales and deliveries of the Compartment 2 Notes). Neither
the delivery of this Offering Circular nor any sale made in connection herewith shall create under any
circumstances any implication that there has been no change in the affairs of the Issuer or any of the
Portfolio Companies since the date hereof or that the information contained herein is correct as of any
time subsequent to its date.
PRESENTATION OF FINANCIAL INFORMATION
The Portfolio Companies prepare their consolidated and unconsolidated financial statements in each
case in euros. As used in this Offering Circular, "euro" or "€" means the single unified currency that
was introduced in Germany and the other participating member states of the European Union on 1
January 1999.
EXCHANGE CONTROLS AND CURRENCY INFORMATION
As contemplated by the Treaty on the European Union (the "Maastricht Treaty"), to which
Luxembourg and Germany are signatories, on 1 January 1999 the third stage of Economic Monetary
Union started the single unified currency, the euro, which became the legal currency for 11 member
states of the European Union, including Luxembourg and Germany, all of which fulfilled the necessary
convergence criteria for adoption of the euro set forth pursuant to the Maastricht Treaty.
There are, except in limited embargo circumstances, no legal restrictions in Germany or Luxembourg
on international capital movements and foreign exchange transactions. However, for statistical
purposes only, every individual or corporation residing in Germany must report to the Deutsche
Bundesbank, subject to certain exceptions, any payment received from or made to an individual or a
corporation resident outside of Germany if such payment exceeds €12,500 (or the equivalent in a
foreign currency).
Austrian Selling Restrictions
THE INITIAL PURCHASERS HAVE REPRESENTED AND AGREED THAT IT WILL ONLY
OFFER COMPARTMENT 2 NOTES IN THE REPUBLIC OF AUSTRIA IN COMPLIANCE WITH
THE PROVISIONS OF THE AUSTRIAN CAPITAL MARKETS ACT (KAPITALMARKTGESETZ
("KMG")), FEDERAL LAW GAZETTE 1991/625 AS AMENDED, AND ANY OTHER LAWS
APPLICABLE IN THE REPUBLIC OF AUSTRIA GOVERNING THE OFFER AND SALE OF THE
COMPARTMENT 2 NOTES IN THE REPUBLIC OF AUSTRIA. THIS OFFERING CIRCULAR IS
NOT A PROSPECTUS WITHIN THE MEANING OF THE KMG AND IT IS NOT A PUBLIC
OFFERING WITHIN THE MEANING OF ARTICLE 1(1)(1) KMG. IN PARTICULAR, THE
COMPARTMENT 2 NOTES HAVE NOT BEEN OFFERED OR SOLD AND WILL NOT BE
OFFERED OR SOLD TO (I) PERSONS OTHER THAN INSTITUTIONAL INVESTORS AS A
LIMITED GROUP OF PERSONS WITHIN THE SCOPE OF THEIR TRADE OR BUSINESS
(ARTICLE 3(1)(11) KMG) AND/OR (II) MORE THAN 250 PERSONS WHO HAVE BEEN
IDENTIFIED PRIOR TO THE OFFERING.
vi
Belgian Selling Restrictions
THE OFFERING OF THE COMPARTMENT 2 NOTES IS NOT ORGANISED OR INTENDED AS
A PUBLIC OFFERING IN BELGIUM. THE BELGIAN BANKING, FINANCE AND INSURANCE
COMMISSION (COMMISSIE VOOR HET BANK-, FINANCIE- EN ASSURANTIEWEZEN /
COMMISSION BANCAIRE FINANCIÈRE ET DES ASSURANCES) HAS NOT REVIEWED OR
APPROVED THIS OFFERING CIRCULAR OR ANY OTHER DOCUMENT RELATED TO THE
OFFERING OF THE COMPARTMENT 2 NOTES AND HAS NOT RECOMMENDED OR
ENDORSED THE PURCHASE OF THE COMPARTMENT 2 NOTES.
NEITHER THIS OFFERING CIRCULAR NOR ANY OTHER DOCUMENT RELATED TO THE
OFFERING OF THE COMPARTMENT 2 NOTES MAY BE DISTRIBUTED TO THE PUBLIC IN
BELGIUM. THE COMPARTMENT 2 NOTES MAY NOT BE PUBLICLY OFFERED FOR SALE
IN BELGIUM AND NO STEPS MAY BE TAKEN WHICH WOULD CONSTITUTE OR RESULT
IN A PUBLIC OFFERING IN BELGIUM AS DEFINED IN THE ROYAL DECREE DATED 7
JULY 1999 ON THE PUBLIC CHARACTER OF FINANCIAL TRANSACTIONS.
FURTHERMORE, NO COMPARTMENT 2 NOTES MAY BE SOLD OR OFFERED FOR SALE TO
CONSUMERS AS SUCH TERM IS DEFINED IN THE LAW DATED 14 JULY 1991 ON
COMMERCIAL PRACTICES AND THE INFORMATION AND PROTECTION OF CONSUMERS.
THIS DOCUMENT IS INTENDED FOR THE CONFIDENTIAL USE OF THE OFFEREE IT IS
INTENDED FOR, AND MAY NOT BE REPRODUCED OR USED FOR ANY OTHER PURPOSE.
ANY ACTION CONTRARY TO THESE RESTRICTIONS MAY CAUSE SUCH NAMED
OFFEREE AND THE ISSUER TO BE IN VIOLATION OF THE BELGIAN SECURITIES LAWS.
Danish Selling Restrictions
THIS OFFERING CIRCULAR HAS NOT BEEN FILED WITH OR APPROVED BY THE DANISH
SECURITIES OR ANY OTHER REGULATORY AUTHORITY IN THE KINGDOM OF
DENMARK. THE COMPARTMENT 2 NOTES MAY NOT BE OFFERED OR SOLD, DIRECTLY
OR INDIRECTLY, IN DENMARK, EXCEPT IN COMPLIANCE WITH THE DANISH
EXECUTIVE ORDER NO. 166 OF 13 MARCH 2003 ON THE FIRST PUBLIC OFFER OF
CERTAIN SECURITIES ISSUED UNDER CHAPTER 12 OF THE DANISH ACT ON TRADING IN
SECURITIES. ACCORDINGLY, THIS OFFERING CIRCULAR MAY NOT BE MADE
AVAILABLE AND THE COMPARTMENT 2 NOTES MAY NOT BE OTHERWISE MARKETED
AND OFFERED FOR SALE IN DENMARK OTHER THAN IN THE CIRCUMSTANCES WHICH
ARE NOT DEEMED AN OFFER TO THE PUBLIC IN DENMARK.
Finnish Selling Restrictions
THE INITIAL PURCHASERS HAVE REPRESENTED AND AGREED THAT THEY WILL NOT
PUBLICLY OFFER THE COMPARTMENT 2 NOTES OR BRING THE COMPARTMENT 2
NOTES INTO GENERAL CIRCULATION IN THE REPUBLIC OF FINLAND OTHER THAN IN
COMPLIANCE WITH ALL APPLICABLE PROVISIONS OF THE LAWS OF THE REPUBLIC OF
FINLAND AND ESPECIALLY IN COMPLIANCE WITH THE FINNISH SECURITIES MARKET
ACT (1989/495), AS AMENDED, AND ANY REGULATION MADE THEREUNDER, AS
SUPPLEMENTED AND AMENDED FROM TIME TO TIME.
THE INITIAL PURCHASERS HAVE REPRESENTED AND AGREED THAT THEY WILL ONLY
OFFER OR SELL COMPARTMENT 2 NOTES ISSUED BY THE ISSUER DIRECTLY OR
INDIRECTLY IN FINLAND OR TO RESIDENTS OF FINLAND IN ACCORDANCE WITH THE
FINNISH SECURITIES MARKET ACT (1989/495), AS AMENDED, AND THE RULES AND
REGULATIONS OF THE FINNISH FINANCIAL SUPERVISION AUTHORITY AND THE
MINISTRY OF FINANCE (IF APPLICABLE).
French Selling Restrictions
IN FRANCE, THE COMPARTMENT 2 NOTES MAY NOT BE DIRECTLY OR INDIRECTLY
OFFERED OR SOLD TO THE PUBLIC, AND OFFERS AND SALES OF THE COMPARTMENT 2
NOTES WILL ONLY BE MADE IN FRANCE TO QUALIFIED INVESTORS PROVIDED THAT
SUCH INVESTORS ACT ON THEIR OWN ACCOUNTS, IN ACCORDANCE WITH ARTICLE L
411-2 OF THE CODE MONÉTAIRE ET FINANCIER, AS AMENDED, AND DÉCRET NO. 98-880
vii
DATED OCTOBER 1, 1998, AS AMENDED. ACCORDINGLY, THIS OFFERING CIRCULAR
HAS NOT BEEN SUBMITTED TO THE AUTORITÉ DES MARCHÉS FINANCIERS. NEITHER
THIS OFFERING CIRCULAR NOR ANY OTHER OFFERING MATERIAL MAY BE
DISTRIBUTED TO THE PUBLIC IN FRANCE. IN THE EVENT THAT THE COMPARTMENT 2
NOTES PURCHASED BY INVESTORS ARE DIRECTLY OR INDIRECTLY OFFERED OR SOLD
TO THE PUBLIC IN FRANCE, THE CONDITIONS SET FORTH IN ARTICLES L-412-1 AND L621-8 OF THE CODE MONÉTAIRE ET FINANCIER MUST BE COMPLIED WITH.
LES TITRES NE POURRONT PAS ÊTRE OFFERTS OU VENDUS DIRECTEMENT OU
INDIRECTEMENT AU PUBLIC EN FRANCE ET NE POURRONT L'ÊTRE QU'À DES
INVESTISSEURS QUALIFIÉS, SOUS RÉSERVE QUE CES INVESTISSEURS AGISSENT POUR
COMPTE PROPRE, AU SENS DE L'ARTICLE L-411-2 DU CODE MONÉTAIRE ET FINANCIER,
TEL QUE MODIFIÉ ET DU DÉCRET NO. 98-880 DU 1ER OCTOBRE 1998 TEL QUE MODIFIÉ.
PAR CONSÉQUENT, CE PROSPECTUS N'A PAS ÉTÉ SOUMIS AU VISA DE L'AUTORITÉ DES
MARCHÉS FINANCIERS. NI CE PROSPECTUS NI AUCUN AUTRE DOCUMENT
PROMOTIONNEL NE POURRONT ÊTRE COMMUNIQUÉS AU PUBLIC EN FRANCE. LA
DIFFUSION, DIRECTE OU INDIRECTE, DANS LE PUBLIC DES TITRES AINSI ACQUIS NE PEUT
PAS ÊTRE RÉALISÉE QUE DANS LES CONDITIONS PRÉVUES AUX ARTICLES L-412-1 ET 621-8
DU CODE MONÉTAIRE ET FINANCIER.
German Selling Restrictions
THE INITIAL PURCHASERS HAVE AGREED TO COMPLY WITH THE FOLLOWING
SELLING RESTRICTIONS APPLICABLE TO THE FEDERAL REPUBLIC OF GERMANY.
PURSUANT TO THE SUBSCRIPTION AGREEMENT, THE INITIAL PURCHASERS HAVE
AGREED THAT THEY SHALL NOT OFFER OR SELL THE COMPARTMENT 2 NOTES IN THE
FEDERAL REPUBLIC OF GERMANY IN SUCH A MANNER AS TO RESULT IN THE ISSUER
BEING SUBJECT TO LICENCE REQUIREMENTS UNDER THE GERMAN BANKING ACT OR
BEING SUBJECT TO REGULATION UNDER THE GERMAN INVESTMENT ACT AND OTHER
THAN IN COMPLIANCE WITH THE RESTRICTIONS CONTAINED IN THE GERMAN
SECURITIES PROSPECTUS ACT (WERTPAPIERVERKAUFSPROSPEKTGESETZ), THE
GERMAN INVESTMENT ACT (INVESTMENTGESETZ), RESPECTIVELY, AND ANY OTHER
LAWS AND REGULATIONS APPLICABLE IN THE FEDERAL REPUBLIC OF GERMANY
GOVERNING THE ISSUE, THE OFFERING AND THE SALE OF SECURITIES.
THE COMPARTMENT 2 NOTES MAY NEITHER BE NOR INTENDED TO BE DISTRIBUTED
BY WAY OF PUBLIC OFFERING, PUBLIC ADVERTISEMENT OR IN A SIMILAR MANNER
WITHIN THE MEANING OF SECTION 1 OF THE GERMAN SECURITIES PROSPECTUS ACT
AND SECTIONS 1, 2 (11) OF THE GERMAN INVESTMENT ACT NOR SHALL THE
DISTRIBUTION OF THIS PROSPECTUS OR ANY OTHER DOCUMENT RELATING TO THE
COMPARTMENT 2 NOTES CONSTITUTE SUCH PUBLIC OFFER. IN ADDITION, THE
INITIAL PURCHASERS HAVE AGREED THAT THEY HAVE OFFERED, SOLD OR
ADVERTISED AND THAT THEY WILL OFFER, SELL OR ADVERTISE THE COMPARTMENT
2 NOTES ONLY TO PERMITTED INSTITUTIONAL INVESTORS ("INSTITUTIONAL
INVESTORS") WITHIN THE MEANING OF THE LEAFLET OF THE GERMAN FEDERAL
FINANCIAL
SUPERVISORY
AGENCY
(BUNDESANSTALT
FÜR
FINANZDIENSTLEISTUNGSAUFSICHT – BAFIN) DATED APRIL 2005 IN THE FEDERAL
REPUBLIC OF GERMANY AND THIS PROSPECTUS MAY NOT BE PASSED ON TO ANY
OTHER PERSON OR ENTITY IN THE FEDERAL REPUBLIC OF GERMANY. FURTHERMORE,
EACH SUBSEQUENT TRANSFEREE/PURCHASER OF THE COMPARTMENT 2 NOTES WILL
BE DEEMED TO REPRESENT THAT IF IT IS A PERSON OR ENTITY IN THE FEDERAL
REPUBLIC OF GERMANY IT IS AN INSTITUTIONAL INVESTOR AND TO AGREE NOT TO
OFFER, SELL OR ADVERTISE THE COMPARTMENT 2 NOTES TO ANY PERSON OR ENTITY
IN THE FEDERAL REPUBLIC OF GERMANY WHO IS NOT AN INSTITUTIONAL INVESTOR.
THE DISTRIBUTION OF THE COMPARTMENT 2 NOTES HAS NOT BEEN NOTIFIED AND
THE COMPARTMENT 2 NOTES ARE NOT REGISTERED OR AUTHORISED FOR PUBLIC
DISTRIBUTION IN THE FEDERAL REPUBLIC OF GERMANY UNDER THE INVESTMENT
ACT. THIS PROSPECTUS HAS NOT BEEN FILED OR DEPOSITED WITH THE GERMAN
FEDERAL FINANCIAL SUPERVISORY AGENCY.
viii
PROSPECTIVE GERMAN INVESTORS IN THE COMPARTMENT 2 NOTES ARE URGED TO
SEEK INDEPENDENT TAX ADVICE AND TO CONSULT THEIR PROFESSIONAL ADVISORS
AS TO THE LEGAL AND TAX CONSEQUENCES THAT MAY ARISE FROM THE
APPLICATION OF THE GERMAN INVESTMENT TAX ACT TO THE COMPARTMENT 2
NOTES AND NEITHER THE ISSUER (NOR THE INITIAL PURCHASERS) ACCEPTS ANY
RESPONSIBILITY IN RESPECT OF THE GERMAN TAX POSITION OF THE COMPARTMENT
2 NOTES.
Irish Selling Restrictions
TO THE EXTENT APPLICABLE, THE ISSUE OF THE COMPARTMENT 2 NOTES SHALL NOT
BE UNDERWRITTEN, NOR SHALL THE COMPARTMENT 2 NOTES BE PLACED
OTHERWISE THAN IN CONFORMITY WITH THE PROVISIONS OF THE IRISH INVESTMENT
INTERMEDIARIES ACT, 1995 (AS AMENDED), INCLUDING, WITHOUT LIMITATION,
SECTIONS 9, 23 (INCLUDING ANY ADVERTISING RESTRICTIONS MADE THEREUNDER)
AND SECTION 37 (INCLUDING ANY CODES OF CONDUCT ISSUED THEREUNDER) THE
PROVISIONS OF THE IRISH INVESTOR COMPENSATION ACT, 1998, INCLUDING,
WITHOUT LIMITATION, SECTION 21.
ANYTHING DONE IN OR THROUGH IRELAND IN CONNECTION WITH THE
COMPARTMENT 2 NOTES WILL BE DONE IN ACCORDANCE WITH THE PROVISIONS OF
THE IRISH MARKET ABUSE (DIRECTIVE 2003/6/EC) REGULATIONS 2005 AND ANY RULES
ISSUED BY THE IRISH FINANCIAL SERVICES REGULATORY AUTHORITY PURSUANT
THERETO.
Italian Selling Restrictions
NO ACTION HAS OR WILL BE TAKEN WHICH WOULD ALLOW AN OFFERING (NOR A
"SOLLECITAZIONE ALL'INVESTIMENTO") OF THE COMPARTMENT 2 NOTES TO THE
PUBLIC IN THE REPUBLIC OF ITALY UNLESS IN COMPLIANCE WITH THE RELEVANT
ITALIAN SECURITIES, TAX AND OTHER APPLICABLE LAWS AND REGULATIONS.
ACCORDINGLY, THE COMPARTMENT 2 NOTES MAY NOT BE OFFERED, SOLD OR
DELIVERED AND NEITHER THIS DOCUMENT NOR ANY OTHER OFFERING MATERIAL
RELATING TO THE COMPARTMENT 2 NOTES MAY BE DISTRIBUTED OR MADE
AVAILABLE TO THE PUBLIC IN THE REPUBLIC OF ITALY. INDIVIDUAL SALES OF THE
COMPARTMENT 2 NOTES TO ANY PERSONS IN THE REPUBLIC OF ITALY MAY ONLY BE
MADE IN ACCORDANCE WITH ITALIAN SECURITIES, TAX AND OTHER APPLICABLE
LAWS AND REGULATIONS.
NEITHER THIS DOCUMENT NOR ANY OTHER INFORMATION SUPPLIED IN CONNECTION
WITH THE ISSUE OF THE COMPARTMENT 2 NOTES SHOULD BE CONSIDERED AS A
RECOMMENDATION OR CONSTITUTING AN INVITATION OR OFFER BY THE ISSUER OR
THE INITIAL PURCHASERS THAT ANY RECIPIENT OF THIS OFFERING CIRCULAR, OR OF
ANY OTHER INFORMATION SUPPLIED IN CONNECTION WITH THE ISSUE OF THE
COMPARTMENT 2 NOTES, SHOULD PURCHASE ANY OF THE COMPARTMENT 2 NOTES.
EACH INVESTOR CONTEMPLATING PURCHASING ANY OF THE COMPARTMENT 2
NOTES MUST MAKE ITS OWN INDEPENDENT INVESTIGATION AND APPRAISAL OF THE
FINANCIAL CONDITION AND AFFAIRS OF THE ISSUER AND THE PORTFOLIO
COMPANIES.
Luxembourg Selling Restrictions
THE INITIAL PURCHASERS HAVE REPRESENTED AND WARRANTED TO THE ISSUER
THAT THEY HAVE NOT MADE ANY PUBLIC OFFERINGS OF THE COMPARTMENT 2
NOTES IN OR FROM LUXEMBOURG UNLESS THE REQUIREMENTS OF LUXEMBOURG
CONCERNING PUBLIC OFFERINGS OF SECURITIES HAVE BEEN COMPLIED WITH. NO
ADVERTISEMENT OR DOCUMENT OR OTHER MATERIAL HAS OR WILL BE
DISTRIBUTED TO THE PUBLIC OR PUBLISHED IN LUXEMBOURG. A LISTING OF ANY OF
THE COMPARTMENT 2 NOTES ON THE LUXEMBOURG STOCK EXCHANGE DOES NOT
IMPLY THAT A PUBLIC OFFERING OF ANY OF THE COMPARTMENT 2 NOTES IN
LUXEMBOURG HAS BEEN AUTHORISED.
ix
Netherlands Selling Restrictions
THE COMPARTMENT 2 NOTES MAY NOT BE OFFERED, SOLD, TRANSFERRED OR
DELIVERED IN OR FROM THE NETHERLANDS, AS PART OF THEIR INITIAL
DISTRIBUTION, OR AT ANY TIME THEREAFTER, DIRECTLY OR INDIRECTLY, OTHER
THAN TO INDIVIDUALS OR LEGAL ENTITIES IN THE NETHERLANDS WHO OR WHICH
TRADE OR INVEST IN SECURITIES IN THE CONDUCT OF A PROFESSION OR TRADE
WITHIN THE MEANING OF SECTION 2 OF THE EXEMPTION REGULATION TO THE
NETHERLANDS SECURITIES MARKET SUPERVISION ACT 1995, AS AMENDED FROM
TIME TO TIME (VRIJSTELLINGREGELING WET TOEZICHT EFFECTENVERKEER 1995),
WHICH INCLUDES BANKS, SECURITIES FIRMS, INSURANCE COMPANIES, PENSION
FUNDS,
INVESTMENT
INSTITUTIONS,
CENTRAL
GOVERNMENTS,
LARGE
INTERNATIONAL AND SUPRANATIONAL ORGANISATIONS, OTHER INSTITUTIONAL
INVESTORS AND OTHER PARTIES, INCLUDING TREASURY DEPARTMENTS OF
COMMERCIAL ENTERPRISES, WHICH ARE REGULARLY ACTIVE IN THE FINANCIAL
MARKETS IN A PROFESSIONAL MANNER. THIS OFFERING CIRCULAR MAY NOT BE
DISTRIBUTED TO ANY INDIVIDUALS OR LEGAL ENTITIES IN THE NETHERLANDS
OTHER THAN TO INDIVIDUALS OR LEGAL ENTITIES WHO OR WHICH TRADE OR INVEST
IN SECURITIES IN THE CONDUCT OF A PROFESSION OR TRADE WITHIN THE MEANING
OF SECTION 2 OF THE EXEMPTION REGULATION TO THE NETHERLANDS SECURITIES
MARKET SUPERVISION ACT 1995, AS AMENDED FROM TIME TO TIME
(VRIJSTELLINGREGELING WET TOEZICHT EFFECTENVERKEER 1995), WHICH INCLUDES
BANK, SECURITIES FIRMS, INSURANCE COMPANIES, PENSION FUNDS, INVESTMENT
INSTITUTIONS,
CENTRAL
GOVERNMENTS,
LARGE
INTERNATIONAL
AND
SUPRANATIONAL ORGANISATIONS, OTHER INSTITUTIONAL INVESTORS AND OTHER
PARTIES, INCLUDING TREASURY DEPARTMENTS OF COMMERCIAL ENTERPRISES,
WHICH ARE REGULARLY ACTIVE IN THE FINANCIAL MARKETS IN A PROFESSIONAL
MANNER.
Portuguese Selling Restrictions
THIS OFFERING CIRCULAR HAS NOT BEEN REGISTERED WITH COMISSÁO DO MERCADO
DE VALORES MOBILIÁROS ("CMVM"), THE PORTUGUESE SECURITIES MARKET
COMMISSION, NOR HAS ANY APPLICATION BEEN OR WILL BE MADE TO OBTAIN
REGISTRATION OF THE PUBLIC OFFERING IN PORTUGAL OF THE COMPARTMENT 2
NOTES WITH CMVM.
CONSEQUENTLY, THE COMPARTMENT 2 NOTES MAY ONLY BE SOLD, OFFERED OR
DISTRIBUTED IN PORTUGAL IN COMPLIANCE WITH ARTICLE 110 OF THE PORTUGUESE
SECURITIES CODE (CODIGO DOS VALORES MOBILIÁRIOS OR "CVM"), AS APPROVED BY
THE DECREE-LAW 486/99, OF 13 NOVEMBER 1999 AND SUBSEQUENTLY MODIFIED) TO
INSTITUTIONAL INVESTORS (CREDIT INSTITUTIONS, INVESTMENT FIRMS, INSURANCE
COMPANIES, COLLECTIVE INVESTMENT SCHEMES AND THEIR RESPECTIVE
MANAGEMENT COMPANIES, PENSION FUNDS AND THEIR RESPECTIVE MANAGEMENT
COMPANIES, OTHER FINANCIAL ENTITIES DULY LICENSED AND REGISTERED TO
REGULARLY AND PROFESSIONALLY INVEST IN TRANSFERABLE SECURITIES
(TOGETHER, "PORTUGUESE INSTITUTIONAL INVESTORS" AS DEFINED IN ARTICLE 30
OF CVM)).
ACCORDINGLY, THIS OFFERING CIRCULAR MAY ONLY BE DISTRIBUTED IN PORTUGAL
TO PORTUGUESE INSTITUTIONAL INVESTORS AND MAY NOT, IN ANY
CIRCUMSTANCES, IN WHOLE OR IN PART, BE REPRODUCED, REDISTRIBUTED,
PUBLISHED OR DELIVERED, NOR ITS CONTENTS DISCLOSED BY ANY MEANS,
DIRECTLY OR INDIRECTLY, TO ANY OTHER PERSON.
ANY ACTION TAKEN CONTRAVENING THE AFOREMENTIONED RESTRICTIONS MAY
CAUSE THE APPLICATION OF PORTUGUESE LEGAL PROVISIONS GOVERNING PUBLIC
OFFERS OF SECURITIES IN PORTUGAL, IN PARTICULAR ARTICLES 109 AND 114 OF CVM.
FOR THE AVOIDANCE OF DOUBT, MADEIRA AND AZORES ISLANDS FALL WITHIN THE
JURISDICTION OF THE REPUBLIC OF PORTUGAL.
x
Spanish Selling Restrictions
THIS OFFERING CIRCULAR HAS NOT BEEN REGISTERED WITH THE COMISIÓN
NACIONAL DEL MERCADO DE VALORES IN SPAIN. CONSEQUENTLY, THE INITIAL
PURCHASERS HAVE ACKNOWLEDGED AND AGREED THAT THEY WILL SELL, OFFER OR
DISTRIBUTE THE COMPARTMENT 2 NOTES IN SPAIN IN ACCORDANCE WITH THE
PROVISIONS OF THE SPANISH SECURITIES MARKET ACT (LAW 24/1988 OF 28 JULY 1988)
AND OF THE SPANISH ROYAL DECREE ON ISSUES AND PUBLIC OFFERINGS OF
SECURITIES (ROYAL DECREE 291/1992 OF 27 MARCH 1992) AND ONLY TO
INSTITUTIONAL INVESTORS THAT CARRY OUT INVESTMENTS IN SECURITIES ON A
REGULAR AND PROFESSIONAL BASIS, SUCH AS PENSION FUNDS, COLLECTIVE
INVESTMENT INSTITUTIONS, INSURANCE COMPANIES, CREDIT ENTITIES AND
SECURITIES COMPANIES, WHICH, IN TURN, WILL NOT BE ABLE RESELL THE
COMPARTMENT 2 NOTES EXCEPT TO OTHER INSTITUTIONAL INVESTORS.
Swiss Selling Restrictions
THE COMPARTMENT 2 NOTES WILL NOT BE OFFERED, DIRECTLY OR INDIRECTLY, TO
THE PUBLIC IN SWITZERLAND AND THIS OFFERING CIRCULAR DOES NOT CONSTITUTE
A PUBLIC OFFERING PROSPECTUS AS THAT TERM IS UNDERSTOOD PURSUANT TO ART.
652a OR ART. 1156 OF THE SWISS FEDERAL CODE OF OBLIGATIONS (SCHWEIZER
OBLIGATIONENRECHT). THE ISSUER HAS NOT APPLIED FOR A LISTING OF THE
COMPARTMENT 2 NOTES ON THE SWX SWISS EXCHANGE OR ON ANY OTHER
REGULATED SECURITIES MARKET; CONSEQUENTLY, THE INFORMATION PRESENTED
IN THIS OFFERING CIRCULAR DOES NOT NECESSARILY COMPLY WITH THE
INFORMATION STANDARDS SET OUT IN THE RELEVANT LISTING RULES. THE
COMPARTMENT 2 NOTES BEING OFFERED PURSUANT TO THIS OFFERING CIRCULAR
HAVE NOT BEEN REGISTERED WITH THE SWISS FEDERAL BANKING COMMISSION
(EIDGENÖSSISCHE BANKENKOMMISSION) AS FOREIGN INVESTMENT FUNDS OR
OTHERWISE, AND THE INVESTOR PROTECTION AFFORDED TO ACQUIRERS OF
INVESTMENT FUND CERTIFICATES DOES NOT EXTEND TO ACQUIRERS OF THE
COMPARTMENT 2 NOTES.
INVESTORS ARE ADVISED TO CONTACT THEIR LEGAL, FINANCIAL OR TAX ADVISERS
TO OBTAIN AN INDEPENDENT ASSESSMENT OF THE FINANCIAL AND TAX
CONSEQUENCES OF AN INVESTMENT IN THE COMPARTMENT 2 NOTES.
United Kingdom Selling Restrictions
THE INITIAL PURCHASERS HAVE REPRESENTED AND AGREED THAT:
(A)
IT HAS ONLY COMMUNICATED OR CAUSED TO BE COMMUNICATED AND WILL
ONLY COMMUNICATE OR CAUSE TO BE COMMUNICATED AN INVITATION OR
INDUCEMENT TO ENGAGE IN INVESTMENT ACTIVITY (WITHIN THE MEANING
OF SECTION 21 OF THE FINANCIAL SERVICES AND MARKETS ACT 2000
(THE "FSMA") RECEIVED BY IT IN CONNECTION WITH THE ISSUE OR SALE OF
THE COMPARTMENT 2 NOTES IN CIRCUMSTANCES IN WHICH SECTION 21(1) OF
THE FSMA DOES NOT APPLY TO THE ISSUER; AND
(B)
IT HAS COMPLIED AND WILL COMPLY WITH ALL APPLICABLE PROVISIONS OF
THE FSMA WITH RESPECT TO ANYTHING DONE BY IT IN RELATION TO THE
COMPARTMENT 2 NOTES IN, FROM OR OTHERWISE INVOLVING THE UNITED
KINGDOM.
United States Selling Restrictions
THE COMPARTMENT 2 NOTES HAVE NOT BEEN AND WILL NOT BE REGISTERED UNDER
THE U.S. SECURITIES ACT OF 1933, AS AMENDED (THE "1933 ACT"), AND MAY NOT BE
OFFERED OR SOLD WITHIN THE UNITED STATES OR TO, OR FOR THE ACCOUNT OR
BENEFIT OF, U.S. PERSONS EXCEPT IN CERTAIN TRANSACTIONS EXEMPT FROM THE
REGISTRATION REQUIREMENTS OF THE 1933 ACT. TERMS USED IN THIS PARAGRAPH
HAVE THE MEANINGS GIVEN TO THEM BY REGULATION S UNDER THE 1933 ACT.
xi
THE COMPARTMENT 2 NOTES IN BEARER FORM ARE SUBJECT TO U.S. TAX LAW
REQUIREMENTS AND MAY NOT BE OFFERED, SOLD OR DELIVERED WITHIN THE
UNITED STATES OR ITS POSSESSIONS OR TO A UNITED STATES PERSON, EXCEPT IN
CERTAIN TRANSACTIONS PERMITTED BY U.S. TAX REGULATIONS. TERMS USED IN
THIS PARAGRAPH HAVE THE MEANINGS GIVEN TO THEM BY THE U.S. INTERNAL
REVENUE CODE AND REGULATIONS THEREUNDER.
THE INITIAL PURCHASERS HAVE AGREED THAT, EXCEPT AS PERMITTED BY THE
SUBSCRIPTION AGREEMENT, THEY WILL NOT OFFER, SELL OR DELIVER THE
COMPARTMENT 2 NOTES, (I) AS PART OF THEIR DISTRIBUTION AT ANY TIME AND (II)
OTHERWISE UNTIL 40 DAYS AFTER THE LATER OF THE COMMENCEMENT OF THE
OFFERING OR THE CLOSING DATE, WITHIN THE UNITED STATES OR TO, OR FOR THE
ACCOUNT OR BENEFIT OF, U.S. PERSONS, AND THEY WILL HAVE SENT TO EACH
DEALER TO WHICH THEY SELL THE COMPARTMENT 2 NOTES DURING THE
DISTRIBUTION COMPLIANCE PERIOD, AS DEFINED IN REGULATION S UNDER THE 1933
ACT, A CONFIRMATION OR OTHER NOTICE SETTING FORTH THE RESTRICTIONS ON
OFFERS AND SALES OF THE COMPARTMENT 2 NOTES WITHIN THE UNITED STATES OR
TO, OR FOR THE ACCOUNT OR BENEFIT OF, U.S. PERSONS.
IN ADDITION, UNTIL 40 DAYS AFTER THE COMMENCEMENT OF THE OFFERING, AN
OFFER OR SALE OF THE COMPARTMENT 2 NOTES WITHIN THE UNITED STATES BY A
DEALER THAT IS NOT PARTICIPATING IN THE OFFERING MAY VIOLATE THE
REGISTRATION REQUIREMENTS OF THE 1933 ACT.
General Selling Restriction
ALL APPLICABLE LAWS AND REGULATIONS MUST BE OBSERVED IN ANY
JURISDICTION IN WHICH THE COMPARTMENT 2 NOTES MAY BE OFFERED, SOLD OR
DELIVERED. THE INITIAL PURCHASERS HAVE AGREED THAT THEY WILL NOT OFFER,
SELL OR DELIVER ANY OF THE COMPARTMENT 2 NOTES, DIRECTLY OR INDIRECTLY,
OR DISTRIBUTE THIS OFFERING CIRCULAR OR ANY OTHER OFFERING MATERIAL
RELATING TO THE COMPARTMENT 2 NOTES, IN OR FROM ANY JURISDICTION EXCEPT
UNDER CIRCUMSTANCES THAT TO THE BEST KNOWLEDGE AND BELIEF OF THE
INITIAL PURCHASERS WILL RESULT IN COMPLIANCE WITH THE APPLICABLE LAWS
AND REGULATIONS THEREOF AND THAT WILL NOT IMPOSE ANY OBLIGATIONS ON
THE ISSUER EXCEPT AS SET OUT IN THE SUBSCRIPTION AGREEMENT.
xii
TABLE OF CONTENTS
Page
SUMMARY OF THE TRANSACTION ..............................................................................................1
SUMMARY OF THE OFFERING.......................................................................................................7
SUMMARY OF THE TERMS AND CONDITIONS OF THE COMPARTMENT 2 NOTES .............20
RISK FACTORS ...............................................................................................................................37
TERMS AND CONDITIONS OF THE COMPARTMENT 2 NOTES................................................49
1.
Definitions and Interpretation ...............................................................................................49
2.
Denomination; Form and Custody, Transferability ................................................................59
3.
Status of the Compartment 2 Notes; Security ........................................................................60
4.
Profit Participation Agreements and Subordinated Loan Agreements.....................................61
5.
Issuer Commitment; Legal Relationships ..............................................................................64
6.
Coupon Payments.................................................................................................................64
7.
Redemption..........................................................................................................................65
8.
Early Partial Redemption......................................................................................................67
9.
Withholding, Early Termination and Repayment for Tax Reasons .........................................67
10.
Priority of Payments .............................................................................................................68
11.
The Accounts and the Custody Accounts ..............................................................................70
12.
Limited Recourse, Non Petition ............................................................................................71
13.
Payments..............................................................................................................................72
14.
Events of Default..................................................................................................................72
15.
Enforcement.........................................................................................................................74
16.
Prescription ..........................................................................................................................75
17.
Agents..................................................................................................................................75
18.
Substitution ..........................................................................................................................76
19.
Notices.................................................................................................................................76
20.
Meetings of Compartment 2 Noteholders; Modification and Waiver......................................77
21.
Final Clauses........................................................................................................................78
Schedules to the Terms and Conditions of the Compartment 2 Notes ..................................................80
USE OF PROCEEDS.........................................................................................................................82
FORM OF THE COMPARTMENT 2 NOTES...................................................................................83
BOOK-ENTRY CLEARANCE PROCEDURES ................................................................................85
DESCRIPTION OF THE OTHER TRANSACTION DOCUMENTS .................................................87
Terms and Conditions of the Profit Participation Agreements .............................................................87
Terms and Conditions of the Subordinated Loan Agreements ........................................................... 106
Description of the Trust Deed........................................................................................................... 124
Description of the Cash Administration Agreement .......................................................................... 129
Description of the Swap Agreement ................................................................................................. 132
Description of the Investment Advisory Agreement.......................................................................... 135
Description of the Recovery Management Agreement...................................................................... 136
Description of the Loan Agreement .................................................................................................. 137
Description of the Paying Agency Agreement................................................................................... 138
THE PORTFOLIO COMPANIES.................................................................................................... 139
Portfolio Overview .......................................................................................................................... 139
Individual Portfolio Company Information ....................................................................................... 143
THE ISSUER .................................................................................................................................. 162
THE TRUSTEE............................................................................................................................... 165
THE CASH ADMINISTRATOR ..................................................................................................... 166
THE SWAP COUNTERPARTY...................................................................................................... 167
THE TRANSACTION ADVISER ................................................................................................... 168
THE RECOVERY MANAGER....................................................................................................... 169
TAXATION .................................................................................................................................... 170
SUBSCRIPTION AND SALE ......................................................................................................... 176
GENERAL INFORMATION........................................................................................................... 181
INDEX OF DEFINED TERMS........................................................................................................ 183
SUMMARY OF THE TRANSACTION
The following paragraphs contain a brief overview of the most significant features of the transaction
consisting of the issuance of the Compartment 2 Notes by the Issuer and payment of the net proceeds
therefrom to the Portfolio Companies under the Financing Agreements (the "Transaction"). This
overview is necessarily incomplete and investors are urged to read carefully the entire summary and
the full text of this Offering Circular for a more precise description of the offered Compartment 2 Notes
and the information concerning (i) the Transaction, (ii) the Portfolio Companies and the Issuer and
(iii) the agreements relating to the Transaction. The following description is based on the
circumstances existing on the Issue Date of the Compartment 2 Notes.
Issue and Application of Proceeds
The Issuer proposes to issue the Compartment 2 Notes, the net proceeds of which will be used by the
Issuer to make (i) Private Portfolio Company Advances (as defined below) to the Private Portfolio
Companies under the Profit Participation Agreements and (ii) the Public Portfolio Company Advances
(as defined below) to the Public Portfolio Companies under the Subordinated Loan Agreements (the
Private Portfolio Company Advances and the Public Portfolio Company Advances, together the
"Advances").
Private Portfolio Company Advances under the Profit Participation Agreement
The Issuer proposes to make to each Private Portfolio Company, a cash advance under each Profit
Participation Agreement (each such cash advance, a "Private Portfolio Company Advance"), in an
amount of not less than €2,000,000 and not greater than €12,500,000. In return for making the Private
Portfolio Company Advance, each Private Portfolio Company will pay to the Issuer the Fixed Interest
Payments as a percentage per annum of the amount of the Private Portfolio Company Advance and
payable quarterly in arrear as determined under the respective Profit Participation Agreement.
Public Portfolio Company Advances under the Subordinated Loan Agreements
The Issuer proposes to make a cash advance to each Public Portfolio Company under each
Subordinated Loan Agreement (each such loan, a "Public Portfolio Company Advance") in an
amount of not less than €2,000,000 and not greater than €12,500,000. In return for making the Public
Portfolio Company Advance, each Public Portfolio Company will pay to the Issuer the Interest
Payments as a percentage per annum of the amount of the Public Portfolio Company Advance and
payable quarterly in arrear as provided by each Subordinated Loan Agreement.
Public Portfolio Companies have the right, but not the obligation, within three months of the relevant
Commencement Date, to alter the terms and conditions of the Subordinated Loan Agreements to those
of a Profit Participation Agreement (each a "Conversion"), provided that they have obtained the
required corporate authorisations. Public Portfolio Companies are incentivised to effect the conversion
because interest rates on the Profit Participation Agreements are lower for the respective Public
Portfolio Companies than interest rates payable under their respective Subordinated Loan Agreements.
From the date that any such Conversion is effective, each Subordinated Loan Agreement so converted
shall be referred to as, and treated as if it were, a Profit Participation Agreement in this Offering
Circular.
Pursuant to the obligation of the Issuer set out in the Trust Deed to terminate each Financing
Agreement on the End Date, each Portfolio Company will be required to repay the relevant Advance in
full on the End Date (see "Summary of the Offering – Profit Participation Agreements" and "Summary
of the Offering – Subordinated Loan Agreements") unless terminated earlier in which event the full
Advance becomes repayable on the effective date of such early termination.
Terms of the Compartment 2 Notes
The Compartment 2 Notes are direct, secured, conditional and limited recourse obligations of the
Issuer. The Issuer's obligation to (a) pay the Coupon Payments and (b) to redeem the Outstanding
Principal Amount of the Compartment 2 Notes (each such redemption payment, a "Capital Payment")
is conditional upon the actual receipt by, or on behalf of, the Issuer into the Issuer Accounts of the
following (collectively, the "Issuer Receipts"):
1
(i)
the Fixed Interest Payments and the repayment of the Private Portfolio Company Advances
from the Private Portfolio Companies under the Profit Participation Agreements;
(ii)
the Interest Payments and the repayment of the Public Portfolio Company Advances from the
Public Portfolio Companies under the Subordinated Loan Agreements;
(iii)
any Make-Whole Amount (as defined in "Terms and Conditions of the Compartment 2
Notes") payable upon the early termination of a Financing Agreement on account of loss of
future Fixed Interest Payments or Interest Payments, as the case may be;
(iv)
the net proceeds realised on the sale of rights and obligations of the Issuer under the Financing
Agreements to a third party or to the shareholders of the respective Portfolio Company (the
"Recoveries"), in accordance with the terms and conditions of the Financing Agreement;
(v)
proceeds from the Permitted Investments (as defined below);
(vi)
any net amount paid (other than as collateral) by the Swap Counterparty to the Issuer under
the Swap Agreement (as defined below);
(vii)
any refund of tax paid to the Issuer which was originally deducted from the Fixed Interest
Payments or Interest Payments; and
(viii)
any sums drawn down under the Loan Agreement.
Other than the Issuer Receipts, the Issuer will have no funds available to meet its obligations under the
Compartment 2 Notes and the Compartment 2 Notes will not give rise to any payment obligation in
excess of the Issuer Receipts. The Issuer shall have no assets available on any Payment Date for
payment of the principal of, and interest on, the Compartment 2 Notes other than Available
Distribution Funds (as defined below) actually received and available for distribution prior to
such Payment Date. Claims in respect of any shortfall will be payable on each following Payment
Date until paid in full and failure by the Issuer to make payment in respect of any such shortfall
will not constitute a default by the Issuer for any purpose. Any Coupon Payments so deferred
will not earn interest. Claims in respect of any shortfall of principal or interest on the
Compartment 2 Notes shall be extinguished on the Legal Maturity Date and failure by the Issuer
to make payment in respect of any such shortfall will not constitute a default by the Issuer for
any purpose.
The order of Priority of Payments set out in the Trust Deed provides that certain fees, costs, expenses
and liabilities of the Issuer will rank senior to amounts owed by the Issuer to the Compartment 2
Noteholders under the Compartment 2 Notes. See "Description of the Other Transaction Documents –
Description of the Trust Deed". If the Available Distribution Funds (as defined below) on any Payment
Date prove ultimately insufficient (after payment of all claims ranking in priority to amounts due under
the Compartment 2 Notes), then the Issuer will be liable to make up the shortfall on the Payment Dates
thereafter until paid in full; however, the Issuer will not be liable for any shortfall arising or remaining
on the Legal Maturity Date.
Interest Rate Swap
The Quarterly Payments to the Issuer under the Financing Agreements are calculated at a fixed interest
rate. The interest rates payable by the Issuer with respect to the Class A Notes and the Class B Notes
are calculated as the sum of six-month EURIBOR (as defined below) and, respectively, the Class A
Margin or the Class B Margin, as set out in the Terms and Conditions of the Compartment 2 Notes.
The Issuer has mitigated this fixed-floating interest rate exposure by entering into a swap agreement
with respect to the Class A Notes and the Class B Notes with the Swap Counterparty on or before the
Issue Date (together, the "Swap Agreement"). The Swap Agreement will require that the Swap
Counterparty meet certain minimum credit standards. If the credit of the Swap Counterparty were to be
rated below these standards, the Swap Counterparty would be required under the Swap Agreement to
provide additional credit support or, in certain circumstances, to find a replacement counterparty. See
"Description of the Other Transaction Documents — Description of the Swap Agreement".
2
Principal Deficiency Ledger
Principal Deficiency Ledger
For the purposes of allocating Principal Deficiencies (as defined below) incurred on any of the
Financing Agreements to the Compartment 2 Notes, the Issuer will maintain or cause to be maintained
on behalf of the Issuer a principal deficiency ledger (the "Principal Deficiency Ledger") to which:
(i)
will be entered as a debit the amount of any Principal Deficiency (as defined below); and
(ii)
will be entered as a credit any amounts applied to reduce Principal Deficiencies in accordance
with paragraphs (J), (K) and (R), as applicable, of the Priority of Payments (as defined below,
see "Summary of the Terms and Conditions of the Compartment 2 Notes").
Principal Deficiency
A "Principal Deficiency" is the amount of the Advance under a Financing Agreement as to which a
Principal Deficiency Event (as defined below) has occurred plus, if a Financing Agreement has been
terminated prior to the Scheduled Redemption Date, any Make-Whole Amount (as defined below)
payable to the Issuer in connection with such terminated Financing Agreement.
Principal Deficiency Event
A "Principal Deficiency Event" occurs upon each of (i) the liquidation of a Portfolio Company, (ii)
the institution of insolvency proceedings against a Portfolio Company or the dismissal of a petition to
open such proceedings against a Portfolio Company on the grounds that such Portfolio Company has
insufficient assets (pursuant to section 26 of the German Insolvency Code), (iii) a Portfolio Company
not fully complying with its obligation under a Financing Agreement to pay Fixed Interest Payments or
Interest Payments (as the case may be) on two consecutive due dates or the total amount of overdue
Fixed Interest Payments or Interest Payments payable by a Portfolio Company under a Financing
Agreement equalling or exceeding the amount accrued as Fixed Profit or Quarterly Interest under such
Financing Agreements during two successive quarters (either of these occurrences, a "Payment
Default"), (iv) the sale of the Issuer's rights and interests in a Financing Agreement and (v) the
termination of a Financing Agreement prior to the Scheduled Redemption Date; provided, however,
that no such event shall be a Principal Deficiency Event to the extent it occurs in connection with a
Financing Agreement as to which a Principal Deficiency Event has previously been recorded in the
Principal Deficiency Ledger. The occurrence of a Principal Deficiency Event shall be immediately
notified by the Transaction Adviser to the Trustee, the Cash Administrator and the Swap Counterparty.
On each Payment Date on which a debit balance appears in the Principal Deficiency Ledger, Available
Distribution Funds (as defined below) will be applied in an amount determined in accordance with the
Priority of Payments (as defined below, see "Summary of the Terms and Conditions of the
Compartment 2 Notes") in redemption of the Class A Notes until the Class A Notes have been fully
redeemed, after which Available Distribution Funds in the amount of any remaining debit balance in
the Principal Deficiency Ledger will be applied in redemption of the Class B Notes until the Class B
Notes have been fully redeemed, after which Available Distribution Funds in the amount of any
remaining debit balance in the Principal Deficiency Ledger will be applied in redemption of the Junior
Notes.
Compartment 2 Collateral
Pursuant to the Trust Deed, the Issuer has in favour of the Trustee for the benefit of the Secured Parties
(as defined in "Index of Defined Terms"): (i) assigned by way of security all right, title and interest of
the Issuer in respect of the Profit Participation Agreements, the Subordinated Loan Agreements, the
Loan Agreement and the Permitted Investments from time to time (where such rights are contractual
rights) including, without limitation, all moneys received in respect thereof, all dividends and
distributions paid or payable thereon, all property paid, distributed, accruing or offered at any time on,
to or in respect of or in substitution therefor and the proceeds of sale, repayment and redemption
thereof, (ii) for the purposes of German law and to the maximum extent permitted under the terms of
the Profit Participation Agreements and the Subordinated Loan Agreements, has assigned by way of
security all right, title and interest of the Issuer in respect to the Profit Participation Agreements and the
Subordinated Loan Agreements, including, without limitation, all moneys received in respect thereof,
3
all dividends and distributions paid or payable thereon, all property paid, distributed, accruing or
offered at any time on, to or in respect of or in substitution therefor and the proceeds of sale, repayment
and redemption thereof (iii) charged by way of a first fixed charge and first priority security interest all
right, title and interest of the Issuer in respect of all Permitted Investments from time to time (where
such rights are securities) including, without limitation, all moneys received in respect thereof, all
dividends and distributions paid or payable thereon, all property paid, distributed, accruing or offered at
any time on, to or in respect of or in substitution therefor and the proceeds of sale, repayment and
redemption thereof, (iv) charged by way of a first fixed charge and first priority security interest all
right, title and interest of the Issuer in respect of the Accounts and all moneys from time to time
standing to the credit of the Accounts and the debts represented thereby and including, without
limitation, all interest accrued and other moneys received in respect thereof, (v) charged by way of a
first fixed charge and first priority security interest all right, title and interest of the Issuer in respect of
the Custody Accounts (including each cash account relating to the Custody Accounts, any cash held
therein and the debt represented thereby), (vi) charged by way of a first fixed charge and first priority
security interest all moneys held from time to time by the Paying Agents for the payment of principal,
interest or other amounts under the Compartment 2 Notes if any, (vii) assigned by way of security all of
the Issuer's right, title and interest, present and future, under the Cash Administration Agreement, (viii)
assigned by way of security all of the Issuer's right, title and interest, present and future under the Asset
Sale and Transfer Agreement, (ix) assigned by way of security all of the Issuer's right, title and interest,
present and future, under the Recovery Management Agreement, (x) assigned by way of security all of
the Issuer's right, title and interest, present and future, under the Paying Agency Agreement, (xi)
assigned by way of security all of the Issuer's right, title and interest, present and future, under the
Investment Advisory Agreement, (xii) assigned by way of security all of the Issuer's right, title and
interest, present and future, under the Swap Agreement (including the Issuer's rights under any
guarantee or credit support annex entered into pursuant to the Swap Agreement provided that such
assignment by way of security shall not in any way restrict the release of Compartment 2 Collateral
granted thereunder in whole or in part at any time pursuant to the terms thereof), and (xiii) charged by
way of a floating charge all of the Compartment 2 undertaking and assets to the extent that such
undertaking and assets are not subject to any other security referred to in paragraphs (i) to (xii) above.
See "Description of the Other Transaction Documents – Description of the Trust Deed".
Pursuant to the Luxembourg Pledge Agreements, the Issuer has in favour of the Trustee for the benefit
of the Secured Parties pledged all right, title and interest of the Issuer in respect of the Permitted
Investments, the Custody Accounts and the Accounts.
Status
The Class A Notes will rank pari passu and rateably without any preference among themselves and
senior in priority to the Class B Notes and the Junior Notes. The Class B Notes will rank pari passu
and rateably without any preference among themselves and senior in priority to the Junior Notes but
junior in priority to the Class A Notes. The Junior Notes will rank pari passu and rateably without any
preference among themselves and junior in priority to the Class A Notes and the Class B Notes. See
"Terms and Conditions of the Compartment 2 Notes". Class A Coupon Payments, Class B Coupon
Payments and Junior Coupon Payments under the Compartment 2 Notes will be paid to the
Compartment 2 Noteholders in the order of Priority of Payments set forth in the terms and conditions
of the Trust Deed. See "Description of the Other Transaction Documents – Description of the Trust
Deed".
Redemption
Scheduled Redemption of Compartment 2 Notes
The Compartment 2 Notes will become due for repayment on the Scheduled Redemption Date out of
Available Distribution Funds (as defined below) and will be redeemed on such date at their
Outstanding Principal Amount.
Scheduled early redemption of the Class A Notes
On each Payment Date during the period from (and including) the Issue Date to (and excluding) the
Scheduled Redemption Date, (or, if earlier, until the Class A Notes have been redeemed in full), the
Issuer will pay (contingent upon the receipt by the Trustee of certain amounts as described below), in
4
redemption of the Outstanding Principal Amount of the Class A Notes, the Class A Amortisation
Amount corresponding to such date as specified in the Class A Amortisation Schedule.
Early redemption of Compartment 2 Notes due to debits in the Principal Deficiency Ledger
Class A Notes may be redeemed, in accordance with the Priority of Payments (as defined below, see
"Summary of the Terms and Conditions of the Compartment 2 Notes") in whole or in part out of
Available Distribution Funds (as defined below) on any Payment Date on which an amount is to be
paid to the holders of the Class A Notes to reduce any debit balance of the Principal Deficiency Ledger.
See "Summary of the Terms and Conditions of the Compartment 2 Notes" under the headings "Senior
Note Redemption and Repayment" and "Early Termination and Repayment".
Class B Notes may be redeemed, in accordance with the Priority of Payments in whole or in part out of
Available Distribution Funds on any Payment Date on which an amount is to be paid to the holders of
the Class B Notes to reduce any debit balance of the Principal Deficiency Ledger. See "Summary of the
Terms and Conditions of the Compartment 2 Notes" under the headings "Senior Note Redemption and
Repayment" and "Early Termination and Repayment".
Junior Notes may be redeemed, in accordance with the Priority of Payments in whole or in part out of
Available Distribution Funds on any Payment Date on which an amount is to be paid to the holders of
the Junior Notes to reduce any debit balance of the Principal Deficiency Ledger. See "Summary of the
Terms and Conditions of the Compartment 2 Notes" under the headings "Junior Note Redemption and
Repayment" and "Early Termination and Repayment".
Application of the Issuer Receipts
Pursuant to the Cash Administration Agreement, during each period from (and including) the second
Business Day prior to a Payment Date (each such date, a "Determination Date") (or, in the case of the
first such period, the Issue Date) until (but excluding) the second Business Day prior to the next
following Payment Date (each such period, a "Due Period"), all Issuer Receipts received in the Issuer
Accounts will be invested by the Cash Administrator on behalf of and in the name of the Issuer, in
investments that meet certain criteria specified in the Terms and Conditions of the Compartment 2
Notes (the "Permitted Investments") and in accordance with the terms of the Cash Administration
Agreement (as defined below).
The Cash Administrator will, at the direction of the Transaction Adviser, liquidate all Permitted
Investments on the Determination Date prior to each Payment Date (all proceeds from such liquidation
as well as any other amounts received by the Cash Administrator for investment in Permitted
Investments but not so invested, collectively, the "Payment Date Permitted Investment Proceeds").
The Issuer will procure that the Payment Date Permitted Investment Proceeds are applied in
accordance with the order of Priority of Payments as set out in the terms and conditions of the Trust
Deed and in accordance with the Cash Administration Agreement. (See "Description of the Other
Transaction Documents — Description of the Trust Deed" and "Description of the Other Transaction
Documents – Description of the Cash Administration Agreement".)
During each Due Period, the Cash Administrator will, in accordance with the terms and conditions of
the Cash Administration Agreement, liquidate sufficient Permitted Investments in order to pay when
due (i) any Administrative Expenses (as defined below) up to the Administrative Expenses Cap (as
defined below) and any Maintenance Expenses (as defined below) that become immediately due and
payable during each Due Period ("Immediate Operating Expenses"), and (ii) any Recovery Manager
Recoveries Fee (as defined below) that becomes due and payable to the Recovery Manager during each
Due Period.
5
Withholding Tax
Under German law in force as at the date of this Offering Circular, the Portfolio Companies will be
required to deduct German withholding tax in an amount equal to 26.375 per cent. of any interest
payments made under the Financing Agreements. Under the terms of the Germany/Luxembourg
double taxation treaty, the Issuer is entitled to, and shall as soon as reasonably practicable after the
Issue Date, apply to the German tax authorities for a refund of such withholding tax deduction.
The Issuer will enter into a loan agreement on or about the Issue Date (the "Loan Agreement") with
HSBC Trinkaus & Burkhardt KGaA as lender (the "Lender") the terms of which will permit the Issuer
to draw down funds from the Lender up to an aggregate principal amount of €2,000,000 in order to
make up any shortfall on payments falling due under the Compartment 2 Notes on any Payment Date
arising as a result of any payments by the Portfolio Companies under the Financing Agreements being
subject to German withholding tax. Sums drawn under the Loan Agreement will be repaid upon
receipt by the Issuer of Withholding Tax Refunds (as defined below).
Transaction Structure
H.E.A.T Mezzanine
Holding GmbH
Interest/Capital1
Issue Proceeds
(PPA) or (SOLA) 2
Portfolio
Companies
100%
Dutch Stichting
100%
Class A Notes
Interest/Capital1
Interest/Capital1
§ Issue Proceeds
H.E.A.T Mezzanine S.A.
PPAs and
SOLAs
Class B Notes
Issue Proceeds
(Issuer)
Junior Notes
Floating rate interest
Fixed rate interest
Swap Counterparty
Transaction Partners
Rating Agencies – Moody’s and Fitch
Recovery Manager – Mbb Consult GmbH
Transaction Advisor – HSBC Trinkaus & Burkhardt KGaA
Principal Paying Agent, Account Bank and Custodian – BNP Paribas Luxembourg Branch
Irish Paying Agent – Custom House Administration & Corporate Services Limited
Trustee – BNP Paribas Trust Corporation UK Limited
Cash Administrator and Calculation Agent – BNP Paribas Securities Services Luxembourg Branch
Swap Counterparty – HSBC Bank plc
Listing Agent – Goodbody Stockbrokers
•1) 100% Capital Repayment at maturity of PPA´s and SOLA´s after 7 years
•2) PPA means Profit Participation Agreement; SOLA means Subordinated Loan Agreement
6
SUMMARY OF THE OFFERING
The following summary describes the most important elements of the offering and the Transaction. It is
necessarily incomplete and investors are urged to read carefully the entire summary and the full text of
this Offering Circular for a more precise description of the offered Compartment 2 Notes and the
information concerning (i) the Transaction, (ii) the Portfolio Companies,(iii) the Issuer, (iv) the other
parties to the Transaction, and (v) the agreements among them. In addition, the summary refers to
certain provisions of the Profit Participation Agreements, the Subordinated Loan Agreements, the
Trust Deed, the Cash Administration Agreement, the Swap Agreement, the Investment Advisory
Agreement, the Recovery Management Agreement and the Paying Agency Agreement. The summary
does not purport to be complete and is subject to, and qualified in its entirety by reference to, the terms
and conditions of such agreements or the more detailed descriptions of such agreements which may be
found under "Description of the Other Transaction Documents" below. The following description is
based on the situation on the Issue Date of the Compartment 2 Notes.
Issuer
H.E.A.T Mezzanine S.A. a limited liability
company incorporated under the laws of
Luxembourg on 12 July 2005 for an unlimited
duration with a Trade and Companies registration
number of R.C.S. Luxembourg B-109.738. The
Issuer is a securitisation vehicle established for
the purpose of issuing asset-backed securities.
Compartment 2 Notes
€218,400,000 Class A Compartment 2 Floating
Rate Notes due 2014 (the "Class A Notes");
30,800,000 Class B Compartment 2 Floating Rate
Notes due 2014 (the "Class B Notes"); and
30,800,000 Junior Compartment 2 Notes due
2014 (the "Junior Notes").
The Class A Notes and the Class B Notes are
together referred to as the "Floating Rate Notes"
or the "Senior Notes". The Senior Notes and the
Junior Notes are together referred to as the
"Compartment 2 Notes".
Issue Date
13 April 2006
Legal Maturity Date
13 April 2014
Scheduled Redemption Date
13 April 2013
Status
The Class A Notes will rank pari passu and
rateably without any preference among
themselves and senior in priority to the Class B
Notes and the Junior Notes.
The Class B Notes will rank pari passu and
rateably without any preference among
themselves and senior in priority to the Junior
Notes but junior in priority to the Class A Notes.
The Junior Notes will rank pari passu and
rateably without any preference among
themselves and junior in priority to the Class A
Notes and the Class B Notes.
Coupon payments in respect of the Class A Notes,
Priority of Payments
7
the Class B Notes and the Junior Notes will be
paid to the Compartment 2 Noteholders in the
order of payment set out in, and subject to, the
terms and conditions of the Compartment 2 Notes
and the Trust Deed. See "Terms and Conditions
of the Compartment 2 Notes".
The net proceeds of the issue of the Compartment
2 Notes will be used by the Issuer on the Issue
Date to:
Use of Proceeds
(a)
pay to each Private Portfolio Company a
Private Portfolio Company Advance,
thereby giving effect to a Profit
Participation Agreement with each
Private Portfolio Company; and
(b)
pay to each of the Public Portfolio
Company a Public Portfolio Company
Advance, thereby giving effect to a
Subordinated Loan Agreement with each
Public Portfolio Company.
Limited Purpose of Issuer
In addition to entering into the Profit Participation
Agreements and the Subordinated Loan
Agreements and certain other agreements
ancillary to the Transaction and the issuance of
the Compartment 2 Notes, the Issuer will not
incur or create any liabilities in the name of the
Issuer other than those necessary in relation to the
business purpose of the Issuer. See "The Issuer".
Portfolio Companies
The Private Portfolio Companies consist of 41
small and medium-sized private companies
located in Germany and organised under German
law.
The Public Portfolio Companies consist of
six small and medium-sized public companies
located in Germany and organised under German
law.
See "The Portfolio Companies" for a list of, and
certain details about, the Portfolio Companies.
Each Private Portfolio Company and three of the
Public Portfolio Companies have made an offer to
HSBC
Trinkaus
&
Burkhardt
KGaA
("Trinkaus") to enter into a Profit Participation
Agreement (which offer is contained in the Profit
Participation Agreement) and Trinkaus has
accepted each such offer prior to the Issue Date.
Profit Participation Agreements
8
In addition, the Issuer and Trinkaus have entered
into an asset sale and transfer agreement (the
"Asset Sale and Transfer Agreement") dated
on or about the Issue Date relating to the sale by
Trinkaus to the Issuer of the Profit Participation
Agreements and the Subordinated Loan
Agreements.
Pursuant to the terms of the Asset Sale and
Transfer Agreement, each Profit Participation
Agreement shall be sold by, and transferred from,
Trinkaus to the Issuer on the Issue Date, and the
Issuer shall make the relevant Advance under
each such Profit Participation Agreement and
shall deliver to Trinkaus written confirmation of
the issuance of the Compartment 2 Notes.
The minimum amount of a Private Portfolio
Company Advance to a Private Portfolio
Company is €2,000,000 and the maximum
amount of a Private Portfolio Company Advance
to a Private Portfolio Company is €12,500,000.
The following sets forth a summary of certain
principal terms of the standard Profit Participation
Agreement. The individual terms of the Profit
Participation Agreements offered to be entered
into by certain Private Portfolio Companies may
vary from the terms presented in this summary.
See "Description of the Other Transaction
Agreements – Terms and Conditions of the Profit
Participation Agreements" and "The Portfolio
Companies – Individual Company Information".
Commencement Date
The term of each Profit Participation Agreement
begins on the date on which the offer by the
relevant Private Portfolio Company to enter into
such Profit Participation Agreement is accepted
by Trinkaus (the "Commencement Date") and
ends upon the End Date (as defined below).
End Date
Each Private Portfolio Company shall be required
to repay the relevant Private Portfolio Company
Advance in full on the anniversary in 2013 of the
Commencement Date (the "End Date") unless
terminated earlier in which event the full Private
Portfolio Company Advance becomes repayable
on the effective date of such early termination.
Quarterly Fixed Interest Payments
Under each Profit Participation Agreement, Fixed
Interest Payments accrue at a rate of
7.933 per cent. per annum on the amount of each
Private Portfolio Company Advance and will
accrue for each consecutive three month period,
beginning on the Commencement Date, within the
term of the Profit Participation Agreement (each,
a "Three Month Period").
Fixed Interest Payments will be payable on 20
March, 20 June, 20 September and 20 December
9
of each calendar year (each a "Fixed Interest
Payment Date"). If the Fixed Interest Payment is
to be calculated for a period of less than one
Three Month Period, it shall be calculated on the
basis of the actual number of days elapsed in such
Three Month Period, divided by 365 (or, in the
case of a leap year, 366).
No payments of principal will be made by the
Private Portfolio Companies other than on
repayment of the Private Portfolio Company
Advances on the End Date, save for instances in
which any Profit Participation Agreement is
terminated early for extraordinary circumstances,
as described below.
Increased Interest
In the event that Fixed Interest Payments are not
paid on their respective due dates, interest shall
continue to accrue but at a rate of 15% per annum
for so long as they remain due and payable but
unpaid and shall increase to 20% per annum in the
event that such sums remain outstanding (in
whole or in part) for two consecutive Fixed
Interest Payment Dates.
Repayment of Advances on the End Date
On the End Date, each Private Portfolio Company
will be obliged to repay the relevant Private
Portfolio Company Advance under the relevant
Profit Participation Agreement to the Issuer in
accordance with the terms and subject to the
conditions stated in the applicable Profit
Participation Agreement.
Early Termination for Extraordinary
Circumstances
The Issuer may terminate a Profit Participation
Agreement early without advance notice for
extraordinary
circumstances
(each,
an
"Extraordinary
Circumstances
Event"),
including, among others:
(i)
the liquidation or insolvency of the relevant
Private Portfolio Company (an "Insolvency
Event");
(ii) a change in the control of the relevant
Private Portfolio Company provided the
Issuer has not given its prior written consent
to such change of control;
(iii) a breach by the relevant Private Portfolio
Company of certain material obligations
under the relevant Profit Participation
Agreement as further specified in the Profit
Participation Agreement (including, without
limitation, the refusal by such Private
Portfolio Company to participate in any
restructuring workshop with the Recovery
Manager in circumstances where it is
required to do so pursuant to the relevant
Profit Participation Agreement); and
(iv) any other
10
Extraordinary
Circumstances
Event specified in the Profit Participation
Agreement.
Subject to certain limited circumstances provided
under German law, a Private Portfolio Company
may not terminate early the relevant Profit
Participation Agreement.
For the avoidance of doubt, a Payment Default (as
defined below) by a Private Portfolio Company
under a Profit Participation Agreement shall not
constitute an Extraordinary Circumstances Event
resulting in early termination of such Profit
Participation Agreement, but shall constitute a
Principal Deficiency Event with respect to the
Compartment 2 Notes, as described below.
In the event that the Issuer terminates a Profit
Participation Agreement upon an Extraordinary
Circumstances Event (or a Private Portfolio
Company terminates a Profit Participation
Agreement in the limited circumstances referred
to above), such Private Portfolio Company will be
obliged to pay the sum of:
(i)
the relevant Private Portfolio Company
Advance; and
(ii) any Make-Whole Amount,
(such sum, the "Early Repayment Amount").
However, other than upon the occurrence of an
Extraordinary Circumstances Event, a material
impairment of the economic condition of the
relevant Private Portfolio Company will not
entitle the Issuer to terminate early the relevant
Profit Participation Agreement.
Insolvency
As provided for in the Profit Participation
Agreements, upon the occurrence of an
Insolvency Event with respect to a Private
Portfolio Company, such Private Portfolio
Company's payment obligations under the
relevant Profit Participation Agreement will be
subordinated to the claims of all other creditors of
such Private Portfolio Company in such manner
that such claims will rank behind (and will
therefore only be satisfied after full satisfaction
of) the claims pursuant to Section 39(1) no. 4 of
the German Insolvency Act and any claims
ranking senior thereto.
Transfer
The Issuer's ability to sell and transfer its interest
in a Profit Participation Agreement is subject to
the restrictions and conditions set out therein.
Neither any Profit Participation Agreement nor
any claim thereunder is represented by a security.
11
Three of the Public Portfolio Companies have
made an offer to Trinkaus to enter into a
Subordinated Loan Agreement (which offer is
contained in the relevant Subordinated Loan
Agreement) and Trinkaus has accepted each such
offer prior to the Issue Date.
Subordinated Loan Agreements
Pursuant to the terms of the Asset Sale and
Transfer Agreement, each Subordinated Loan
Agreement shall be sold by, and transferred from,
Trinkaus to the Issuer on the Issue Date, and the
Issuer shall make the relevant Advance under
each such Subordinated Loan Agreement and
shall deliver to Trinkaus written confirmation of
the issuance of the Compartment 2 Notes.
The minimum amount of a Public Portfolio
Company Advance is €2,000,000 and the
maximum amount of a Public Portfolio Company
Advance is €12,500,000.
The following sets forth the principal terms of the
standard Subordinated Loan Agreement. The
individual terms of the Subordinated Loan
Agreements offered to be entered into by certain
Public Portfolio Companies may vary from the
terms presented in this summary.
See
"Description of the Other Transaction Agreements
– Terms and Conditions of the Subordinated Loan
Agreements" and "The Portfolio Companies –
Individual Company Information".
Commencement Date
The term of the Subordinated Loan Agreements
begins on the Commencement Date and ends on
the End Date.
End Date
Each Public Portfolio Company shall be required
to repay the relevant Public Portfolio Company
Advance in full on the End Date unless terminated
earlier in which event the full advance becomes
repayable on the effective date of such early
termination.
Interest Payments
Under each Subordinated Loan Agreement,
Interest Payments accrue at a rate of 8.333 per
cent. per annum on the amount of each Public
Portfolio Company Advance and will accrue for
each three month period within the term of the
Profit Participation Agreement (each, a "Three
Month Period").
Interest Payments will be payable on 20 March,
20 June, 20 September and 20 December of each
calendar year. If the Interest Payment is to be
calculated for a period of less than one calendar
quarter, it shall be calculated on the basis of the
actual number of days elapsed in the respective
period, divided by 365 (or, in the case of a leap
year, 366).
12
Increased Interest
In the event that Interest Payments are not paid on
their respective due dates, interest shall continue
to accrue but at a rate of 15% per annum for so
long as they remain due and payable but unpaid
and shall increase to 20% per annum in the event
that such sums remain outstanding (in whole or in
part) for two consecutive interest payment dates.
Repayment of Advances on the End Date
On the End Date, each Public Portfolio Company
will be obliged to pay the relevant Public
Portfolio Company Advance under the relevant
Subordinated Loan Agreement to the Issuer in
accordance with the terms and subject to the
conditions stated in the applicable Subordinated
Loan Agreement.
Early Termination for Extraordinary
Circumstances
The Issuer may terminate a Subordinated Loan
Agreement early without advance notice for
extraordinary
circumstances
(each,
an
"Extraordinary
Circumstances
Event")
including among others:
(i)
the liquidation or insolvency of the relevant
Public Portfolio Company (an "Insolvency
Event");
(ii) a change in the control of the relevant Public
Portfolio Company provided the Issuer has
not given its prior written consent to such
change of control;
(iii) a breach by the relevant Public Portfolio
Company of certain material obligations
under the relevant Subordinated Loan
Agreement as further specified in the
Subordinated Loan Agreement (including,
without limitation, the refusal by such Public
Portfolio Company to participate in any
restructuring workshop with the Recovery
Manager in circumstances where it is
required to do so pursuant to the relevant
Subordinated Loan Agreement); and
(iv) any other Extraordinary Circumstances
Event under the Subordinated Loan
Agreement.
Subject to certain limited circumstances provided
under German law, a Public Portfolio Company
may not terminate early the relevant Subordinated
Loan Agreement.
For the avoidance of doubt, a Payment Default (as
defined below) by a Public Portfolio Company
under a Subordinated Loan Agreement shall not
constitute an Extraordinary Circumstances Event
resulting in early termination of such
Subordinated Loan Agreement, but shall
constitute a Principal Deficiency Event with
respect to the Compartment 2 Notes, as described
13
below.
In the event that the Issuer terminates a
Subordinated Loan Agreement upon an
Extraordinary Circumstances Event (or a Public
Portfolio Company terminates a Subordinated
Loan Agreement in the limited circumstances
referred to above), such Public Portfolio
Company will be obliged to pay the sum of:
(i)
the Public Portfolio Company Advance;
and
(ii)
any Make-Whole Amount
(such sum, an "Early Repayment Amount").
However, other than upon the occurrence of an
Extraordinary Circumstances Event, a material
impairment of the economic condition of the
relevant Public Portfolio Company will not entitle
the Issuer to terminate early the relevant
Subordinated Loan Agreement.
Insolvency
As provided for in the Subordinated Loan
Agreements, upon the occurrence of an
Insolvency Event with respect to a Public
Portfolio Company, such Public Portfolio
Company's payment obligations under the
relevant Subordinated Loan Agreement are
subordinated to the claims of all other creditors of
such Public Portfolio Company in such manner
that, in the event of liquidation or insolvency of
the Company, such claims will rank behind (and
shall therefore only be satisfied after full
satisfaction of) the claims pursuant to Section
39(1) no. 4 of the German Insolvency Act and any
claims ranking senior thereto.
Conversion
Each Public Portfolio Company has the right, but
not the obligation within three months of the
relevant Commencement Date, to convert its
Subordinated Loan Agreement with the Issuer
into a Profit Participation Agreement with the
Issuer (a "Conversion") provided that it has
obtained
the
prior
requisite
corporate
authorisations.
Transfer
The Issuer's ability to sell and transfer its interest
in a Subordinated Loan Agreement is subject to
the restrictions and conditions set out therein.
Neither any Subordinated Loan Agreement nor
any claim thereunder is represented by a security.
Pursuant to the Trust Deed entered into between
the parties thereto on or before the Issue Date, the
Issuer has in favour of the Trustee for the benefit
of the Secured Parties (as defined in "Glossary of
Defined Terms"):
Trust Deed
14
15
(i)
assigned by way of security all right, title
and interest of the Issuer in respect of the
Profit Participation Agreements, the
Subordinated Loan Agreements, the Loan
Agreement the Permitted Investments from
time to time (where such rights are
contractual rights) including, without
limitation, all moneys received in respect
thereof, all dividends and distributions paid
or payable thereon, all property paid,
distributed, accruing or offered at any time
on, to or in respect of or in substitution
therefor and the proceeds of sale,
repayment and redemption thereof;
(ii)
for the purposes of German law and to the
maximum extent permitted under the terms
of the Profit Participation Agreements and
the Subordinated Loan Agreements,
assigned by way of security all right, title
and interest of the Issuer in respect to the
Profit Participation Agreements and the
Subordinated Loan Agreements, including,
without limitation, all moneys received in
respect thereof, all dividends and
distributions paid or payable thereon, all
property paid, distributed, accruing or
offered at any time on, to or in respect of or
in substitution therefor and the proceeds of
sale, repayment and redemption thereof;
(iii)
charged by way of a first fixed charge and
first priority security interest all right, title
and interest of the Issuer in respect of all
Permitted Investments from time to time
(where such rights are securities) including,
without limitation, all moneys received in
respect thereof, all dividends and
distributions paid or payable thereon, all
property paid, distributed, accruing or
offered at any time on, to or in respect of or
in substitution therefor and the proceeds of
sale, repayment and redemption thereof;
(iv)
charged by way of a first fixed charge and
first priority security interest all right, title
and interest of the Issuer in respect of the
Accounts and all moneys from time to time
standing to the credit of the Accounts and
including, without limitation, all interest
accrued and other moneys received in
respect thereof;
(v)
charged by way of first fixed charge and
first priority security interest all right, title
and interest of the Issuer in respect of the
Custody Accounts (including each cash
account relating to the Custody Accounts,
any cash held therein and the debt
represented thereby);
(vi)
charged by way of a first fixed charge and
first priority security interest all moneys
held from time to time by the Paying
Agents for the payment of principal,
interest or other amounts under the
Compartment 2 Notes (if any);
(vii) assigned by way of security all of the
Issuer's right, title and interest, present and
future, under the Cash Administration
Agreement;
(viii) assigned by way of security all of the
Issuer's right, title and interest, present and
future, under the Asset Sale and Transfer
Agreement;
(ix)
assigned by way of security all of the
Issuer's right, title and interest, present and
future, under the Recovery Management
Agreement;
(x)
assigned by way of security all of the
Issuer's right, title and interest, present and
future, under the Paying Agency
Agreement;
(xi)
assigned by way of security all of the
Issuer's right, title and interest, present and
future, under the Investment Advisory
Agreement;
(xii) assigned by way of security all of the
Issuer's right, title and interest, present and
future, under the Swap Agreement
(including the Issuer's rights under any
guarantee or credit support annex entered
into pursuant to the Swap Agreement
provided that such assignment by way of
security shall not in any way restrict the
release of Compartment 2 Collateral
granted thereunder in whole or in part at
any time pursuant to the terms thereof); and
(xiii) charged by way of a floating charge all of
the Compartment 2 undertaking and assets
to the extent that such undertaking and
assets are not subject to any other security
referred to in paragraphs (i) to (xii) above.
Pursuant to the Luxembourg Pledge Agreements,
the Issuer has in favour of the Trustee for the
benefit of the Secured Parties pledged all right,
title and interest of the Issuer in respect of the
Permitted Investments, the Custody Accounts and
the Accounts.
The Issuer will enter into an investment advisory
agreement
(the
"Investment
Advisory
Investment Advisory Agreement
16
Agreement") with the Trustee and HSBC
Trinkaus & Burkhardt KGaA as Transaction
Adviser (the "Transaction Adviser") on or
before the Issue Date.
Under the Investment Advisory Agreement, the
Transaction Adviser is required, among other
things, to monitor the performance of the
Portfolio Companies, to supervise the Recovery
Manager and generally assist the Issuer with
respect to the proper administration of the
Financing Agreements.
The Transaction Adviser shall also monitor the
probability of default rating assigned by Moody's
KMV Company ("MKMV") to each Portfolio
Company, and shall advise the Issuer in the event
that such rating with respect to any Portfolio
Company is downgraded to below the minimum
rating set out in the relevant Financing Agreement
(each, a "Downgraded Financing Agreement").
The Transaction Adviser shall also have the right
to obtain all relevant information and documents
from the Issuer which are necessary for it to
discharge its obligations under the Investment
Advisory Agreement. The Transaction Adviser
may also obtain relevant information and reports
from the Recovery Manager to monitor the
Recovery Manager's activities.
See "Description of the Other Transaction
Documents – Description of the Investment
Advisory Agreement".
The Issuer has entered into a recovery
management
agreement
(the
"Recovery
Management Agreement") with the Trustee and
mbb Consult GmbH as recovery manager (the
"Recovery Manager").
Recovery Management Agreement
Under the Recovery Management Agreement, the
Recovery Manager is required to, among other
things, evaluate the potential for, and make
recommendations concerning the sale or
termination, if possible, of any Downgraded
Financing Agreements or in the event that a
Portfolio Company commits a Payment Default
under the applicable Financing Agreement. If the
Recovery Manager recommends the sale of the
relevant Financing Agreement, and the Issuer
consents to such action, the Recovery Manager
will then conduct a search for a potential
purchaser of the relevant Financing Agreement
and prepare a sales memorandum.
In addition, in the event that the credit of a
Portfolio Company may be impaired, the
Recovery Manager shall, pursuant to the relevant
Financing Agreement, carry out a restructuring
workshop with the management of the relevant
17
Portfolio Company to determine the possibility of
a restructuring of such Portfolio Company's debts.
See "Description of the Other Transaction
Documents – Description of the Recovery
Management Agreement".
Cash Administration Agreement
The Issuer has entered into a cash administration
agreement dated on or around the Issue Date (the
"Cash Administration Agreement") with
(among others) BNP Paribas Securities Services,
Luxembourg branch (the "Cash Administrator")
pursuant to which the Cash Administrator will,
among other things, (i) receive Issuer Receipts
into and make payments from the Accounts, (ii)
invest, as directed by the Transaction Adviser,
Issuer Receipts it receives from time to time prior
to each Payment Date in Permitted Investments
and (iii) at the direction of the Transaction
Adviser, make disbursements in respect of any
Immediate Operating Expenses and any Recovery
Manager Recoveries Fees. See "Description of
the Other Transaction Documents – Description
of the Cash Administration Agreement".
Account Bank and Custodian
Under the Paying Agency Agreement, the Issuer
has appointed BNP Paribas, Luxembourg branch
as account bank (the "Account Bank") to
establish interest bearing accounts in the name of
Compartment 2 (the "Accounts") and as
custodian (the "Custodian") to hold those
Permitted Investments which are capable of being
held in the Custody Accounts on behalf of the
Issuer and, in each case, to carry out such
functions as required by the Paying Agency
Agreement and the Cash Administration
Agreement.
Swap Agreement
The Issuer will enter into the Swap Agreement
with HSBC Bank plc (the "Swap Counterparty")
in order to reduce the potential impact of certain
fixed/floating rate mismatches between payments
under the Financing Agreements and the Floating
Senior Coupon Payments under the Class A Notes
and the Class B Notes. See "Description of the
Other Transaction Documents – Description of
the Swap Agreement".
Paying Agency Agreement
Pursuant to a paying agency agreement (the
"Paying Agency Agreement") entered into by the
Issuer on or before the Issue Date with the
Account Bank and Custodian, BNP Paribas,
Luxembourg branch as principal paying agent (the
"Principal Paying Agent"), BNP Paribas
Securities Services, Luxembourg branch as
calculation agent (the "Calculation Agent") and
Custom House Administration & Corporate
Services Limited (the "Irish Paying Agent",
together with the Principal Paying Agent, the
Calculation Agent, the Account Bank, the
18
Custodian and the Cash Administrator, the
"Agents"), the Issuer has appointed the Principal
Paying Agent to make certain determinations and
authentications, to effect payments of interest and
principal under the Compartment 2 Notes and to
maintain certain records.
Trustee
BNP Paribas Trust Corporation UK Limited
Swap Counterparty
HSBC Bank plc
Cash Administrator
BNP Paribas Securities Services, Luxembourg
branch
Account Bank
BNP Paribas, Luxembourg branch
Custodian
BNP Paribas, Luxembourg branch
Transaction Adviser
HSBC Trinkaus & Burkhardt KGaA
Calculation Agent
BNP Paribas Securities Services, Luxembourg
branch
Recovery Manager
mbb Consult GmbH
Principal Paying Agent
BNP Paribas, Luxembourg branch
Irish Paying Agent
Custom House Administration & Corporate
Services Limited
Listing
Application has been made to list the
Compartment 2 Notes on the Irish Stock
Exchange.
Governing Law of the Compartment 2 Notes,
the Trust Deed, the Paying Agency Agreement,
the Cash Administration Agreement, the Swap
Agreement and the Subscription Agreement
English law
Governing Law of the Financing Agreements,
the Asset Sale and Transfer Agreement, the
Investment Advisory Agreement and the
Recovery Management Agreement
German law
Governing Law of the Luxembourg Pledge
Agreements
Luxembourg law
19
SUMMARY OF THE TERMS AND CONDITIONS OF THE COMPARTMENT 2 NOTES
The following summary refers to certain terms and conditions of the Compartment 2 Notes. The
summary does not purport to be complete and is subject to, and qualified in its entirety by reference to,
the terms and conditions of the Compartment 2 Notes which may be found under "Terms and
Conditions of the Compartment 2 Notes".
Compartmen
t 2 Notes
Principal
Amount
Issue Price
Denominatio
ns
Moody's
Rating
Fitch's
Rating
Class A Notes
218,000,000
100%
€50,000
Aaa
AAA
Class B Notes
30,8000,000
100%
€50,000
A1
A+
Junior Notes
30,8000,000
100%
€50,000
N/A
N/A
Form
The Compartment 2 Notes of each class will each be
initially represented by a temporary global note in
bearer form without coupons (each, a "Temporary
Global Note" and, together, the "Temporary
Global Notes") which will be exchangeable (in
whole or in part) not earlier than 40 days after the
Issue Date for a permanent global note in bearer
form without coupons (each, a "Permanent Global
Note" and, together, the "Permanent Global Notes"
and, the Temporary Global Notes and the Permanent
Global Notes together, the "Global Notes" and each
a "Global Note") upon certification as to non-U.S.
beneficial
ownership.
In
certain
limited
circumstances, beneficial interests in the Permanent
Global Notes will be exchangeable for Compartment
2 Notes in definitive bearer form ("Definitive
Notes").
Status
The Class A Notes constitute direct, unsubordinated,
secured, conditional and limited recourse obligations
of the Issuer ranking pari passu and rateably without
any preference among themselves and in priority to
the Class B Notes and the Junior Notes.
The Class B Notes constitute direct, subordinated,
secured, conditional and limited recourse obligations
of the Issuer ranking pari passu and rateably without
any preference among themselves and senior to the
Junior Notes but junior to the Class A Notes.
The Junior Notes constitute direct, subordinated,
secured, conditional and limited recourse obligations
of the Issuer ranking pari passu and rateably without
any preference among themselves but junior to the
Class A Notes and the Class B Notes.
Payment Dates
13 April and 13 October of each year, commencing
13 October 2006 up to and including the Legal
Maturity Date.
20
Floating Interest Rate for the Class A Notes
Interest on the Outstanding Principal Amount of the
Class A Notes will accrue during each period
commencing on (and including) a Payment Date and
ending on (but excluding) the following Payment
Date (the "Accrual Period", provided however, that
the first Accrual Period will commence on (and
include) the Issue Date and end on (but exclude) the
first Payment Date) at a floating rate (the "Class A
Floating Rate"), determined semi-annually for each
Accrual Period, that is equal to the sum of
EURIBOR (as defined below) and a margin of 0.33
per cent. per annum.****
"EURIBOR" for each Accrual Period means the rate
for deposits in euro for a period of six months which
appears on Reuters 3000 Page EURIBOR01 (or such
other page as may replace such page on that service
for the purpose of displaying European inter-bank
offered rate quotations of major banks) as of 11:00
a.m. (Brussels time) on the second Business Day
immediately preceding the commencement of such
Accrual Period (each, a "EURIBOR Determination
Date"), all as determined by the Calculation Agent;
provided, however, that EURIBOR with respect to
(i) the Accrual Period commencing on the Issue Date
and ending on the first Payment Date (or, if
applicable, commencing on the Scheduled
Redemption Date and ending on the next following
Payment Date) shall be calculated on the basis of a
linear interpolated rate for deposits in euro for a
period of four months and deposits in euro for a
period of five months and (ii) the Accrual Period
ending on the Scheduled Redemption Date (or, if
applicable, the Legal Maturity Date) shall be
calculated on the basis of a linear interpolated rate
for deposits in euro for a period of seven months and
deposits in euro for a period of eight months. If
Reuters 3000 Page EURIBOR01 is not available or
if no such quotation appears thereon, in each case as
at such time, the Principal Paying Agent shall
request the principal Euro-zone office of the
Reference Banks (as defined below) selected by it to
provide the Principal Paying Agent with its offered
quotation (expressed as a percentage rate per annum)
for six-month deposits (or for such other periods, as
referred to above) in euro at approximately 11:00
a.m. (Brussels time) on the relevant EURIBOR
Determination Date to prime banks in the Euro-zone
inter-bank market for the relevant Accrual Period
and in an amount that is representative for a single
transaction in that market at that time. If two or more
of the selected Reference Banks provide the
Principal Paying Agent with such offered quotations,
EURIBOR for such Accrual Period shall be the
arithmetic mean of such offered quotations (rounded
if necessary to the nearest one thousandth of a
percentage point, with 0.000005 being rounded
upwards). If on the relevant EURIBOR
Determination Date fewer than two of the selected
Reference Banks provide the Principal Paying Agent
21
with such offered quotations, EURIBOR for such
Accrual Period shall be the rate per annum which the
Principal Paying Agent determines as being the
arithmetic mean (rounded if necessary to the nearest
one thousandth of a percentage point, with 0.000005
being rounded upwards) of the rates communicated
to (and at the request of) the Principal Paying Agent
by major banks in the Euro-zone, selected by the
Principal Paying Agent, at approximately 11:00 a.m.
(Brussels time) on such EURIBOR Determination
Date for loans in euro to leading European banks for
such Accrual Period and in an amount that is
representative for a single transaction in that market
at that time. "Reference Banks" means four major
banks in the Euro-zone inter-bank market. "Eurozone" means the region comprising member states of
the European Union that have adopted the single
currency, the euro, in accordance with the EC
Treaty. "EC Treaty" means the Treaty establishing
the European Community signed in Rome on 25
March 1957, as amended from time to time,
including by the Treaty on European Union signed
in Maastricht on 7 February 1992.
Class A Coupon Payments
Class A Coupon Payments will be made on each
Class A Note at the Class A Floating Rate of the
Outstanding Principal Amount per Class A Note
from (and including) the Issue Date to (but
excluding) the Legal Maturity Date. Class A Coupon
Payments will be payable semi-annually in arrear on
13 April and 13 October of each year, commencing
on 13 October 2006 and ending on the Legal
Maturity Date, subject to the Priority of Payments
(as defined below). The Issuer shall have no assets
available on any Payment Date for payment of a
Class A Coupon Payment other than Available
Distribution Funds (as defined below) actually
received and available for use by the Issuer prior to
such Payment Date. Claims in respect of any
shortfall will be payable on each following Payment
Date, subject to funds being available in accordance
with the Priority of Payments, until paid in full and
failure by the Issuer to make payment in respect of
any such shortfall will not constitute a default by the
Issuer for any purpose. Any Class A Coupon
Payments so deferred will not earn interest. Claims
in respect of any shortfall on the Legal Maturity
Date shall be extinguished and failure by the Issuer
to make payment in respect of any such shortfall will
not constitute a default by the Issuer for any purpose.
Class A Coupon Payments, if any, will be paid in the
order of, and subject to, the Priority of Payments set
out in the terms and conditions of the Trust Deed.
See "Description of the Other Transaction
Documents – Description of the Trust Deed".
Floating Interest Rate for the Class B Notes
Interest on the Outstanding Principal Amount of the
Class B Notes will accrue during each Accrual
Period at a floating rate (the "Class B Floating
22
Rate"), determined semi-annually for each Accrual
Period, that is equal to the sum of EURIBOR (as
defined above) and a margin of 0.83 per cent. per
annum.
Class B Coupon Payments
Class B Coupon Payments will be made on each
Class B Note at the Class B Floating Rate of the
Outstanding Principal Amount (as defined below)
per Class B Note from (and including) the Issue Date
to (but excluding) the Legal Maturity Date. Class B
Coupon Payments will be payable semi-annually in
arrear on 13 April and 13 October of each year,
commencing on 13 October 2006 and ending on the
Legal Maturity Date, subject to the Priority of
Payments. The Issuer shall have no assets available
on any Payment Date for payment of a Class B
Coupon Payment other than Available Distribution
Funds actually received and available for use by the
Issuer prior to the applicable Payment Date. Claims
in respect of any shortfall will be payable on each
following Payment Date, subject to funds being
available in accordance with the Priority of
Payments, until paid in full and failure by the Issuer
to make payment in respect of any such shortfall will
not constitute a default by the Issuer for any purpose.
Any Class B Coupon Payments so deferred will not
earn interest. Claims in respect of any shortfall on
the Legal Maturity Date shall be extinguished and
failure by the Issuer to make payment in respect of
any such shortfall will not constitute a default by the
Issuer for any purpose.
Class B Coupon Payments, if any, will be paid in the
order of, and subject to, the Priority of Payments.
See "Description of the Other Transaction
Documents – Description of the Trust Deed".
Junior Coupon Payments
Junior Coupon Payments will be made on each
Junior Note at a percentage rate per annum set out in
the Junior Coupon Rate Schedule (initially 17.15 per
cent.) of the Junior Notional Amount from (and
including) the Issue Date until (but excluding) the
Legal Maturity Date. Junior Coupon Payments will
be payable semi-annually in arrear on 13 April and
13 October of each year, commencing on 13 October
2006 and ending on the Legal Maturity Date, subject
to the Priority of Payments (as defined below) have
been satisfied in full. The Issuer shall have no assets
available on any Payment Date for payment of a
Junior Coupon Payment other than Available
Distribution Funds actually received and available
for use by the Issuer prior to the applicable Payment
Date. Claims in respect of any shortfall will be
payable on each following Payment Date, subject to
funds being available in accordance with the Priority
of Payments, until paid in full and failure by the
Issuer to make payment in respect of any such
shortfall will not constitute a default by the Issuer for
any purpose. Any Junior Coupon Payments so
deferred will not earn interest. Claims in respect of
23
any shortfall on the Legal Maturity Date shall be
extinguished and failure by the Issuer to make
payment in respect of any such shortfall will not
constitute a default by the Issuer for any purpose.
Junior Coupon Payments, if any, will be paid in the
order of, and subject to, the Priority of Payments.
See "Description of the Other Transaction
Documents – Description of the Trust Deed".
Priority of Payments
Class A Coupon Payments, Class B Coupon
Payments, Junior Coupon Payments and Capital
Payments under the Compartment 2 Notes will be
paid to the respective Compartment 2 Noteholders in
the order of, and subject to, the Priority of Payments.
See "Terms and Conditions of the Compartment 2
Notes – Priority of Payments".
Subject to the conditions, on each Payment Date the
Cash Administrator shall on behalf of the Issuer
apply all Available Distribution Funds (as defined
below) as at that Payment Date in the order of
priority of payment set out in the Conditions (the
"Priority of Payments") and described below but,
in each case, only to the extent that there are funds
available for that purpose and all payments of a
higher priority have been made in full:
(A)
first, in payment of all amounts then due
and payable by the Issuer in respect of
Trustee Fees and Expenses;
(B)
second, in or towards repayment of any
amounts due and payable to the Lender
under the Loan Agreement (whether by way
of Loan Advance or otherwise) but
excluding any expenses of the Lender
incurred pursuant to the Loan Agreement;
(C)
third, in or towards payment pari passu
with each other on a pro rata basis of all
amounts then due and payable by the Issuer
in respect of Maintenance Expenses;
(D)
fourth, save for the Payment Date on which
the Junior Notes have previously been
redeemed in full or fall due to be redeemed
in full, in payment into the Expenses
Reserve Account up to a credit balance of
€75,000;
(E)
fifth, in or towards payment pari passu
with each other on a pro rata basis of all
amounts then due and payable by the Issuer
in respect of any Administrative Expenses
up to an amount equal to the Administrative
Expenses Cap;
(F)
sixth, in or towards payment to the Swap
Counterparty of any Swap Settlement
Payments due and payable under the Swap
24
Agreement (other than any amounts payable
pursuant to paragraph (O) below);
(G)
seventh, on any Payment Date to the
Principal Paying Agent, in or towards
payment on a pro rata basis pari passu with
each other of the Class A Coupon Payments
then due and payable by the Issuer on the
Class A Notes (with the Outstanding
Principal Amount of the Class A Notes to
be determined prior to the application of the
payments in (H), (K) and (L) below);
(H)
eighth, on any Payment Date on or
following the Scheduled Redemption Date,
to the Principal Paying Agent in or towards
payment to holders of the Class A Notes
pari passu with each other of the
Outstanding Principal Amount of the Class
A Notes on a pro rata basis until all Class
A Notes have been fully redeemed;
(I)
ninth, on any Payment Date, to the
Principal Paying Agent in or towards
payment on a pro rata basis pari passu with
each other of the Class B Coupon Payments
Payments then due and payable by the
Issuer on the Class B Notes (with the
Outstanding Principal Amount of the Class
B Notes to be determined prior to the
application of the payments in (M) below);
(J)
tenth, on any Payment Date on or
following the Scheduled Redemption Date,
to the Principal Paying Agent in or towards
payment to holders of the Class B Notes
pari passu with each other of the
Outstanding Principal Amount of the Class
B Notes on a pro rata basis until all Class B
Notes have been fully redeemed;
(K)
eleventh, on each Payment Date prior to the
Scheduled Redemption Date and to the
extent that any Class A Notes are then
outstanding, to the Principal Paying Agent
in or towards payment to holders of the
Class A Notes pari passu with each other
on a pro rata basis as scheduled partial
redemption on the Class A Notes, of an
amount equal to the lesser of:
(L)
25
(x)
the Class A Amortisation Amount
corresponding to such Payment Date,
as specified in the Class A
Amortisation Schedule; and
(y)
the Outstanding Principal Amount of
the Class A Notes;
twelfth, on any Payment Date on which the
Principal Deficiency Ledger shows a debit
balance, to the Principal Paying Agent in or
towards payment to holders of the Class A
Notes pari passu with each other on a pro
rata basis as early redemption of the Class
A Notes of an amount equal to the lesser of:
(M)
(x)
such debit balance (expressed as a
positive figure); and
(y)
the Outstanding Principal Amount of
the Class A Notes;
thirteenth, on any Payment Date on or
after which the Class A Notes have been
fully redeemed and on which the Principal
Deficiency Ledger shows a debit balance, to
the Principal Paying Agent in or towards
payment to holders of the Class B Notes
pari passu with each other on a pro rata
basis as early redemption of the Class B
Notes of an amount equal to the lesser of:
(x)
such debit balance (expressed as a
positive figure) (taking into account
the application of the payments in
(L) above); and
(y)
the Outstanding Principal Amount of
the Class B Notes;
(N)
fourteenth, in or towards payment to the
parties to whom Administrative Expenses
are due under paragraph (E) above, pari
passu with each other on a pro rata basis,
of that portion, if any, of the aggregate of
such Administrative Expenses that is
greater than the Administrative Expenses
Cap;
(O)
fifteenth, to any amounts then due and
payable with respect to any termination
payment due to the Swap Counterparty
under the Swap Agreement because of an
event of default relating to the Swap
Counterparty or because it is the sole
Affected Party (as defined in the Swap
Agreement), and any costs due to the Swap
Counterparty with respect thereto, to the
Swap Counterparty;
(P)
sixteenth, on any Payment Date, to the
Principal Paying Agent in or towards
payment to holders of the Junior Notes on a
pro rata basis pari passu with each other of
the Junior Coupon Payments then due and
payable by the Issuer on the Junior Notes,
(Q)
seventeenth, on any Payment Date on or
following the Scheduled Redemption Date,
to the Principal Paying Agent in or towards
payment to holders of the Junior Notes pari
26
passu with each other of the Outstanding
Principal Amount of the Junior Notes on a
pro rata basis until all Junior Notes have
been redeemed in full;
(R)
eighteenth, on any Payment Date on or
after which the Senior Notes have been
fully redeemed and on which the Principal
Deficiency Ledger shows a debit balance, to
the Principal Paying Agent in and towards
payment to the holders of the Junior Notes
pari passu with each other on a pro rata
basis as early redemption on the Junior
Notes of an amount equal to the lesser of:
(x)
such amount as is necessary after the
application of the payments in (L)
and (M) above to reduce the debit
balance in the Principal Deficiency
Ledger to zero; and
(y)
the Outstanding Principal Amount of
the Junior Notes;
(S)
nineteenth, in or towards payment of the
Subordinated Placement Fee payable to
Trinkaus;
(T)
twentieth, in or towards payment of a
dividend to the shareholders of the Issuer as
a distribution of profits for the fiscal year of
the Issuer ending immediately prior to such
Payment Date and in accordance with the
relevant meeting of the shareholders of the
Issuer; and
(U)
twenty-first, any remaining amounts to the
Issuer Account pending application on the
next succeeding Payment Date of the
Available Distribution Funds in the manner
described in (A) to (T) above.
For the purpose of the above:
"Administrative Expenses" means, collectively, all
fees, costs and expenses due and payable by the
Issuer acting on behalf of Compartment 2, payable
on a pro rata basis, to:
(i)
the recipient(s) of
Administration Fees;
(ii)
the Agents (other than the Cash
Administrator) under the Paying Agency
Agreement;
(iii)
the Cash Administrator under the Cash
Administration Agreement;
(iv)
the Recovery Manager of the Ongoing
Recovery Manager Fee under the Recovery
27
the
Corporate
Management Agreement;
(v)
the Irish Stock Exchange;
(vi)
the Rating Agencies;
(vii)
the auditors and legal counsel of the Issuer
in respect of Compartment 2;
(viii)
the Transaction Adviser in respect of the
Senior Transaction Adviser Fee under the
Investment Advisory Agreement;
(ix)
Trinkaus in respect of the Senior Placement
Fee under the Subscription Agreement;
(x)
any further fees, costs and expenses of the
Compartment 2 payable under any of the
Transaction Documents (other than (a)
Maintenance Expenses, (b) any amounts
payable under the Swap Agreement and (c)
any Subordinated Placement Fee); and
(xi)
any payments to employees of the Issuer
and any lease payments in respect of any
premises of the Issuer up to an aggregate
amount not exceeding €75,000 in respect of
each Due Period.
"Administrative Expenses Cap" means €800,000
for each Due Period.
"Agents" means the Paying Agents, the Calculation
Agent, the Account Bank, the Custodian and the
Cash Administrator, and "Agent" means any one of
them.
"Available Distribution Funds" means for each
Payment Date, the total amount of any Issuer
Receipts and sums drawn under the Loan Agreement
(i) held by the Issuer or (ii) held or invested in
Permitted Investments by the Cash Administrator, as
determined by the Transaction Adviser on behalf of
the Issuer on the immediately preceding
Determination Date;
"Corporate Administration Fees" means the fees
payable in respect of Compartment 2 to either (i) to
the directors of the Issuer or (ii) pursuant to a
corporate administration agreement entered into with
the Issuer, to a corporate administrator, in either case
on account of services provided with respect to the
administration of the Issuer.
"Due Period" means each period from (and
including) a Determination Date (or, in the case of
the first such period, the Issue Date) until (but
excluding) the next following Determination Date;
"Expenses Reserve" means a reserve amount
payable to the Cash Administrator for investment (at
28
the direction of the Transaction Adviser) in
Permitted Investments in an amount estimated by the
Issuer to be sufficient to cover the Wind-up Costs;
"Loan Advance" means a loan advance under the
Loan Agreement;
"Loan Agreement" means the loan agreement dated
on or about the Issue Date between the Issuer and
the Lender;
"Maintenance Expenses" means any expenses
incurred in connection with:
(i)
maintaining the corporate existence of the
Issuer and the Issuer's annual return, filing,
registration and registered office fees; and
(ii)
the Issuer's liability (if any) to tax in respect
of Compartment 2.
"Ongoing Recovery Manager Fee" means the
ongoing fee payable by the Issuer to the Recovery
Manager on each Payment Date pursuant to the
Recovery Management Agreement, excluding any
Recovery Manager Recoveries Fee;
"Recovery Manager Recoveries Fee" means the fee
payable by the Issuer to the Recovery Manager
under the Recovery Management Agreement upon
the realisation of Recoveries by the Recovery
Manager;
"Senior Placement Fee" means the amount of
€600,000 payable by the Issuer to Trinkaus on each
Payment Date pursuant to the Subscription
Agreement;
"Senior Transaction Adviser Fee" means the fees
and expenses of the Transaction Adviser payable by
the Issuer to the Transaction Adviser pursuant to the
Investment Advisory Agreement.
"Subordinated Placement Fee" means, on any
given Payment Date, the amount calculated in
accordance with the following formula (save that
where the application of such formula results in a
negative number, the Subordinated Placement Fee
shall be zero):
I = (R – IC) x F
where:
"I" means the relevant Subordinated Placement Fee;
"R" means the surplus (if any) remaining on such
Payment Date after the payments referred to in
paragraphs (A) to (T) (inclusive) of the Priority of
Payments have been made (or, if there is no such
29
surplus, "R" shall be zero);
"IC" means the surplus (if any) that was remaining
on the immediately preceding Payment Date (if
there is one) after the payments referred to in
paragraphs (A) to (U) of the Priority of Payments
have been made less the amount of the
Subordinated Placement Fee (if any) paid on such
Payment Date (save that if either (i) such
calculation results in a negative number or (ii) "IC"
falls to be calculated on or after the Scheduled
Redemption Date, then "IC" shall be zero);
"F" means 0.75 (in respect of each Payment Date
falling prior to the Scheduled Redemption Date) or
1.00 (in respect of each Payment Date falling on or
after the Scheduled Redemption Date);
"Swap Settlement Payments" means, any net
settlement amount and costs, and any termination
payment payable to the Swap Counterparty under
the Swap Agreement (other than any termination
payment due to the Swap Counterparty under the
Swap Agreement because of an event of default
relating to the Swap Counterparty or because the
Swap Counterparty is the sole Affected Party (as
defined in the Swap Agreement));
"Trustee Fees and Expenses " means the fees and
expenses of the Trustee payable by the Issuer to the
Trustee pursuant to the Trust Deed; and
"Wind-Up Costs" means, collectively, (i) the
Issuer's operating expenses arising from the day
immediately following the Scheduled Redemption
Date to the Legal Maturity Date and (ii) the Issuer's
obligations, if any, to pay the fees, costs and
expenses of the Trustee, the Transaction Adviser, the
Agents, the Recovery Manager and the Cash
Administrator.
Payment of Expenses During a Due Period
Determination Date
During each Due Period, the Cash Administrator
may use Issuer Receipts to pay:
(i)
any Immediate Operating Expenses and
(ii)
any Recovery Manager Recoveries Fee due
and payable to the Recovery Manager (but
only as long as the aggregate amount of
Recovery Manager Recoveries Fee paid
during a Due Period does not exceed the
aggregate amount of Recoveries actually
received by the Issuer during such Due
Period).
Pursuant to the terms of the Cash Administration
Agreement, the Cash Administrator will determine
the amounts to be paid on a Payment Date on the
immediately preceding Determination Date, after
which time the Swap Settlement Payments may be
30
made.
Redemption
The Class A Notes will become due for repayment
on the Scheduled Redemption Date (or earlier if the
Compartment 2 Notes have been redeemed prior to
the Scheduled Redemption Date by the Issuer or the
holders of the Compartment 2 Notes in extraordinary
circumstances (including following an event of
default as set out in Condition 14 (Events of Default)
of the terms and conditions of the Compartment 2
Notes) or on account of the Issuer's exercise of its
right of early termination with respect to the
Compartment 2 Notes if the Issuer is required to
withhold or deduct amounts payable under the
Compartment 2 Notes on account of tax) and will be
redeemed on the Scheduled Redemption Date, out of
Available Distribution Funds available on or after
that date, at their Outstanding Principal Amount.
See "Senior Note Partial Early Redemption",
"Principal Deficiency Ledger" and "Withholding,
Early Termination and Repayment" below.
The Class B Notes will become due for repayment
on the Scheduled Redemption Date (or earlier if the
Compartment 2 Notes have been redeemed prior to
the Scheduled Redemption Date by the Issuer or the
holders of the Compartment 2 Notes in extraordinary
circumstances (including following an event of
default as set out in Condition 14 (Events of Default)
of the terms and conditions of the Compartment 2
Notes) or on account of the Issuer's exercise of its
right of early termination with respect to the
Compartment 2 Notes if the Issuer is required to
withhold or deduct amounts payable under the
Compartment 2 Notes on account of tax) and will be
redeemed on the Scheduled Redemption Date, out of
Available Distribution Funds available on or after
that date, at their Outstanding Principal Amount.
See "Senior Note Partial Early Redemption",
"Principal Deficiency Ledger" and "Withholding,
Early Termination and Repayment" below.
The Junior Notes will become due for repayment on
the Scheduled Redemption Date (or earlier if the
Compartment 2 Notes have been redeemed prior to
the Scheduled Redemption Date by the Issuer or the
holders of the Compartment 2 Notes in extraordinary
circumstances (including following an event of
default as set out in Condition 14 (Events of Default)
of the terms and conditions of the Compartment 2
Notes) or on account of the Issuer's exercise of its
right of early termination with respect to the
Compartment 2 Notes if the Issuer is required to
withhold or deduct amounts payable under the
Compartment 2 Notes on account of tax) out of
Available Distribution Funds and will be redeemed
on the Scheduled Redemption Date out of Available
Distribution Funds available on or after that date at
31
their Outstanding Principal Amount.
Early termination of the Compartment 2 Notes,
including, for example, following an event of
default, may not (unless and until Financing
Agreements are able to be sold or terminated early
effectively and until Recoveries or Early Repayment
Amounts are received by the Issuer) result in early
redemption of the Compartment 2 Notes and, despite
such termination, Compartment 2 Noteholders may
have to wait until the Scheduled Redemption Date or
the Legal Maturity Date for redemption of their
Compartment 2 Notes.
See "Senior Note Partial Early Redemption",
"Principal Deficiency Ledger" and "Withholding,
Early Termination and Repayment" below.
Senior Note Partial Early Redemption
The Class A Notes will be redeemed, in part:
(i)
pro rata to their Outstanding Principal
Amount, on each Payment Date prior to the
Scheduled Redemption Date in an amount
equal to the Class A Amortisation Amount
applicable to such Payment Date; and
(ii)
pro rata to their Outstanding Principal
Amount, on each Payment Date on which the
Issuer makes a Principal Deficiency Ledger
Repayment (as defined below), in the amount
of such Principal Deficiency Ledger
Repayment,
but only to the extent funds are available therefor in
accordance with the Priority of Payments.
The Class B Notes will be redeemed, in part, pro
rata to their Outstanding Principal Amount, on each
Payment Date on which the Issuer makes a Principal
Deficiency Ledger Repayment (as defined below),
an amount equal to the excess, if any, of (x) such
Principal Deficiency over (y) the amounts paid on
such Payment Date to the holders of the Class A
Notes on account of such Principal Deficiency
Ledger debit balance, but only to the extent funds
are available therefor in accordance with the Priority
of Payments.
Junior Note Partial Early Redemption
The Junior Notes will be redeemed, in part, pro rata
to their Outstanding Principal Amount, on each
Payment Date on which the Issuer makes a Principal
Deficiency Ledger Repayment (as defined below),
an amount equal to the excess, if any, of (x) such
Principal Deficiency over (y) the amounts paid on
such Payment Date to the holders of the Class A
Notes and the Class B Notes on account of such
Principal Deficiency Ledger debit balance, but only
to the extent funds are available therefor in
accordance with the Priority of Payments.
32
The Issuer will maintain or cause to be maintained
the Principal Deficiency Ledger in which shall be
entered (i) as a debit any Principal Deficiencies and
(ii) as a credit the amount of any Principal
Deficiency Ledger Repayments (as defined below).
Principal Deficiency Ledger
On each Payment Date on which a debit balance
exists in the Principal Deficiency Ledger, a payment
(each such payment, a "Principal Deficiency
Ledger Repayment") will be made to the Principal
Paying Agent for distribution to the holders of the
Class A Notes in redemption of the Class A Notes,
in an amount (to the extent of the amount of
Available Distribution Funds available on such
Payment Date) determined in accordance with the
Priority of Payments. If the amount of such debit
balance (expressed as a positive figure) exceeds the
then Outstanding Principal Amount of the Class A
Notes, then such excess will be distributed to the
holders of the Class B Notes in redemption of the
Class B Notes to the extent funds are available in
accordance with the Priority of Payments. If the
amount of such debit balance (expressed as a
positive figure) exceeds the amount necessary to
fully redeem both the Class A Notes and the Class B
Notes, then such excess will be distributed to the
holders of the Junior Notes in redemption of the
Junior Notes to the extent funds are available and in
accordance with the Priority of Payments.
If, on the Legal Maturity Date, the amount of the
Available Distribution Funds is not sufficient to
make any remaining payments on the Compartment
2 Notes, the Issuer will be under no obligation to
make any such remaining payments to the
Compartment 2 Noteholders.
Withholding,
Repayment
Early
Termination
and
If (i) as a result of any change in, or amendment to,
the laws or regulations of Luxembourg or any
political subdivision or taxing authority thereto or
therein affecting taxation or the obligation to pay
duties of any kind, or any change in, or amendment
to, an official interpretation or application of such
laws or regulations, which amendment or change is
effective on or after the Issue Date or (ii) because the
Issuer is determined to have a taxable presence in
Germany (the Issuer having agreed not to take any
action that reasonably could be expected to lead to
such a determination), the Issuer is required to
withhold or deduct amounts payable on the
Compartment 2 Notes on account of tax, the Issuer
will not be obliged to gross-up any such obligation,
but may, commencing on or after the first
anniversary of the Issue Date, at its option, on any
Payment Date thereafter, redeem the Compartment 2
Notes, in whole but not in part, upon not more than
60 days' nor less than 30 days' prior notice of
redemption given to the Principal Paying Agent and
to the Compartment 2 Noteholders in accordance
with the terms and conditions of the Compartment 2
33
Notes, at their Outstanding Principal Amount,
together with interest accrued on their Outstanding
Principal Amount (in the case of the Senior Notes)
or the Junior Notional Amount (in the case of the
Junior Notes) to the date fixed for redemption, in
accordance with the order of Priority of Payments
set forth in the terms and conditions of the Trust
Deed. Any such notice shall be irrevocable, must
specify the date fixed for redemption and must set
forth a statement in summary form of the facts
constituting the basis for the right of the Issuer so to
redeem. Interest accrued under the Class A Notes
and the Class B Notes shall be calculated on the
basis of the actual number of days elapsed in the
respective period, divided by 360.
The Trustee may at its discretion subject to the
consent of, and shall at the request of, the
Controlling Class (in each case subject to being
indemnified to its satisfaction, against all liabilities,
proceedings, claims and demands to which it may
thereby become liable and all costs, charges and
expenses which may be incurred by it in connection
therewith) declare all of the Compartment 2 Notes to
be due and payable upon the occurrence of certain
events, such as a failure by the Issuer to make
payment or perform another material obligation
owed under the Compartment 2 Notes or the
insolvency or dissolution of the Issuer, set out more
fully in the terms and conditions of the Compartment
2 Notes. Notwithstanding acceleration of the
Compartment 2 Notes, all amounts payable upon a
termination of the Compartment 2 Notes by the
Compartment 2 Noteholders will be paid at the
times, in the order of, and subject to, the Priority of
Payments set out more fully in the terms and
conditions of the Compartment 2 Notes and in the
Trust Deed. See "Terms and Conditions of the
Compartment 2 Notes – Events of Default".
Limited Recourse and Non-Petition
The obligations of the Issuer to pay amounts due and
payable in respect of the Compartment 2 Notes and
to the other Secured Parties at any time shall be
limited to the Available Distribution Proceeds
available at such time to make such payment in
accordance with the Priority of Payments. If the net
proceeds of realisation of the security constituted by
the Trust Deed, upon enforcement thereof in
accordance with Condition 15 (Enforcement) and the
provisions of the Trust Deed, are less than the
aggregate amount payable in such circumstances by
the Issuer in respect of the Compartment 2 Notes and
to the other Secured Parties (such negative amount
being referred to herein as a "shortfall"), the
obligations of the Issuer in respect of the
Compartment 2 Notes of each Class and its
obligations to the other Secured Parties in such
circumstances will be limited to such net proceeds,
which shall be applied in accordance with the
Priority of Payments. In such circumstances, the
34
other assets (if any) of the Issuer will not be
available for payment of such shortfall which shall
be borne by the Secured Parties in accordance with
the Priority of Payments (applied in reverse order).
The rights of the Secured Parties to receive any
further amounts in respect of such obligations shall
be extinguished and none of the Compartment 2
Noteholders of each Class or the other Secured
Parties may take any further action to recover such
amounts.
None of the Compartment 2 Noteholders of any
Class, the Trustee or the other Secured Parties (nor
any other person acting on behalf of any of them)
shall be entitled at any time to institute against the
Issuer, or join in any institution against the Issuer of,
any bankruptcy, reorganisation, arrangement,
insolvency, winding-up or liquidation proceedings or
other proceedings under any applicable bankruptcy
or similar law in connection with any obligations of
the Issuer relating to the Compartment 2 Notes of
any Class, the Trust Deed or otherwise owed to the
Secured Parties, save for lodging a claim in the
liquidation of the Issuer which is initiated by another
party or taking proceedings to obtain a declaration or
judgment as to the obligations of the Issuer.
Claims in respect of any shortfall on the Legal
Maturity Date shall be extinguished and failure by
the Issuer to make payment in respect of any such
shortfall will not constitute a default by the Issuer for
any purpose.
Financial Statements
Compartment 2 Noteholders are entitled to request
copies of the Issuer's financial statements. See
"General Information".
Notices
For so long as the Compartment 2 Notes are listed
on the Irish Stock Exchange and the rules of the Irish
Stock Exchange so require, notices to Compartment
2 Noteholders will be valid if made to the Company
Announcements Office of the Irish Stock Exchange.
Provided that the rules of the stock exchange(s)
where the Compartment 2 Notes are listed so permit,
this notice requirement may be satisfied by the
delivery of the relevant notice to Euroclear and/or
Clearstream Luxembourg for communication by
them to the Compartment 2 Noteholders or by
delivery directly to the Compartment 2 Noteholders.
Following each Payment Date, the Issuer shall
publish a notice in accordance with the terms and
conditions of the Compartment 2 Notes notifying the
holders of the Junior Notes of the amount of any
such payment to be made to the holders of the Junior
Notes and specifying whether such payment is made
on account of Junior Coupon Payments or Capital
Payments in respect of the Junior Notes.
Selling Restrictions
Subject to certain exceptions, the Compartment 2
Notes may not be sold or delivered, directly or
35
indirectly, within the United States or its possessions
or to U.S. persons. These restrictions and other
restrictions on the sale and delivery of the
Compartment 2 Notes in Austria, Belgium,
Denmark, Finland, France, Germany, Ireland, Italy,
Jersey, Luxembourg, The Netherlands, Portugal,
Spain, Switzerland, the United Kingdom and the
United States are specified under "Subscription and
Sale"
Governing Law of the Compartment 2 Notes
English
Tax Consequences
For a discussion of the material Luxembourg and
German tax consequences of purchasing, owning
and disposing of the Compartment 2 Notes, see
"Taxation".
36
RISK FACTORS
The following is a summary of certain aspects of the Compartment 2 Notes of which prospective
investors should be aware. This summary is not intended to be exhaustive and prospective investors
should carefully consider the following information in conjunction with the other information
contained in this Offering Circular.
An investment in the Compartment 2 Notes is only suitable for investors experienced in financial
matters who are in a position to fully assess the risks relating to such an investment and who have
sufficient financial means to suffer any potential loss stemming therefrom.
The description of the risks in this section is not comprehensive. New risks, uncertainties and
other factors may emerge from time to time and it is not possible for the Issuer or any other
party involved in the issuance of the Compartment 2 Notes to predict all such risk factors, to
assess the impact of all such risk factors on their businesses or the extent to which any factor, or
combination of factors, may cause actual results or events to differ materially from those
expected or contained in any forward-looking statements. Given these risks and uncertainties,
the investor should not place undue reliance on forward-looking statements as a prediction or
guarantee of actual results or events.
None of the Issuer, the Initial Purchasers, the Trustee or any other party to the Transaction
Documents has an obligation to update or otherwise revise any projections, including any
revisions to reflect changes in economic conditions or other circumstances arising after the date
of this Offering Circular or to reflect the occurrence of unanticipated events, even if the
underlying assumptions do not come to fruition.
I.
General Risks
Investments in the Compartment 2 Notes are subject to the risk associated with an investment in the
underlying portfolio of Financing Agreements.
It is intended that the Issuer will invest in a portfolio of Financing Agreements with certain risk
characteristics as described below under "Risks relating to the Portfolio Companies and the Financing
Agreements". There can be no assurance that the Issuer's investments will be successful, that the
holders of Compartment 2 Notes will receive the full amounts payable by the Issuer under the
Compartment 2 Notes or that they will receive any return on their investment in the Compartment 2
Notes. Prospective investors are therefore advised to review this entire Offering Circular carefully and
should consider, among other things, the factors set out below before deciding whether to invest in the
Compartment 2 Notes. Except as is otherwise stated below, such risk factors are generally applicable to
all classes of Compartment 2 Notes, although the degree of risk associated with each class of
Compartment 2 Notes will vary in accordance with its position in the Priority of Payments. The Initial
Purchasers do not undertake and have not undertaken to review the financial condition or affairs of the
Issuer or the Portfolio Companies during the life of the arrangements contemplated by this Offering
Circular nor to advise any investor or potential investor in the Compartment 2 Notes of any information
coming to the attention of the Initial Purchasers which is not included in this Offering Circular.
Compartment 2 Notes may not be suitable investments for all investors.
Prospective purchasers of the Compartment 2 Notes of any class should ensure that they understand the
nature of such Compartment 2 Notes and the extent of their exposure to risk, that they have sufficient
knowledge, experience and access to professional advisors to make their own legal, tax, accounting and
financial evaluation of the merits and risks of investment in such Compartment 2 Notes and that they
consider the suitability of such Compartment 2 Notes as an investment in the light of their own
circumstances and financial condition.
37
II.
Risks relating to the Portfolio Companies and the Financing Agreements
The Issuer's ability to make payments on the Compartment 2 Notes depends, among other things,
upon the operative performance, debt service capabilities and profitability of the Portfolio
Companies.
The ability of the Issuer to pay amounts payable as Class A Coupon Payments to the holders of the
Class A Notes, as Class B Coupon Payments to the holders of the Class B Notes and as Junior Coupon
Payments to holders of the Junior Notes depends upon the general operating performance and debt
service capabilities of the Portfolio Companies. The ability of the Issuer to make Capital Payments on
the Compartment 2 Notes on the Scheduled Redemption Date and/or the Legal Maturity Date depends
upon the Portfolio Companies' ability to repay the Advances to the Issuer. There can be no assurance
that the Portfolio Companies will be able to generate the funds necessary to meet their respective
payment obligations under the Financing Agreements. If any Portfolio Companies should become
unable to meet their payment obligations under the Financing Agreements, the Issuer may become
partially or wholly unable to make Coupon Payments and/or Capital Payments under the Compartment
2 Notes.
Claims of the Issuer against each Portfolio Company under the respective Financing Agreements
are subordinated in the event of the Portfolio Company's liquidation or insolvency.
The payment obligations of the Portfolio Companies under the Financing Agreements constitute
unsecured obligations that are subordinated in the Portfolio Company's liquidation or insolvency to the
prior satisfaction in full of all existing and future indebtedness of the Portfolio Companies in such
manner that such claims will rank behind (and shall therefore only be satisfied after full satisfaction of)
all non-subordinated debt of the relevant Portfolio Company and certain claims which are subordinated
thereto by operation of law, but in priority to the claims of shareholders of the Portfolio Company for
the repayment of capital-replacing loans and similar claims (Section 39(1) no. 5 of the German
Insolvency Act). Accordingly, the Issuer's rights under a Financing Agreement against a Portfolio
Company will rank junior to all creditors of the relevant Portfolio Company in the event of the
liquidation or insolvency of a Portfolio Company, and senior only to the respective equity holders,
creditors of capital-replacing loans and similar claims as well as creditors that have expressly agreed
with the respective Portfolio Company to rank junior to the relevant Financing Agreement.
The ability of the Issuer to terminate Financing Agreements for extraordinary reasons, including in
the event of breaches by Portfolio Companies of their obligations under the Financing Agreements,
is limited and subject to waiting periods. In the event of a termination for extraordinary reasons, the
Issuer's claim for the Early Repayment Amount is subject to standstill arrangements.
The Issuer will be entitled to terminate the Financing Agreements early in the event of extraordinary
circumstances. These circumstances include the liquidation or insolvency of the relevant Portfolio
Company, a change in its control or a breach by it of certain material obligations under the relevant
Financing Agreement as further specified in each Financing Agreement. However, other than in
connection with one of the extraordinary circumstances for termination set out in the applicable
Financing Agreement, a material impairment of the economic condition of the relevant Portfolio
Company will not entitle the Issuer to terminate the Financing Agreement early. In such case, the
Issuer will therefore remain fully exposed to a deterioration of the Portfolio Companies' financial
soundness for the scheduled term of the Financing Agreement (unless the Issuer is able to sell the
relevant Financing Agreement in accordance with its terms).
The Portfolio Companies are not subject to any restrictive covenants with respect to indebtedness
that ranks in priority to the claims of the Issuer under the Financing Agreements. They are only
subject to limited restrictions on the incurrence of additional subordinated debt.
The Portfolio Companies have agreed in the Financing Agreements not to issue to third parties further
financing instruments with profit-linked or profit-oriented remuneration (profit participation rights in
the form of a Genussrecht, silent partnerships, or profit participating loans, but not contributions made
to the share capital or to the capital reserves) and financing instruments which in the case of the
Portfolio Companies would be subordinated in the insolvency of the respective Portfolio Company
(Section 39 German Insolvency Act) without the Issuer's prior written approval, if such financing
instruments would pursuant to their terms rank senior to the payment obligations of the relevant
38
Portfolio Company under the relevant Financing Agreement in the event of the Portfolio Company's
insolvency. Apart from this, the Portfolio Companies have not entered into any restrictive covenants in
connection with the Financing Agreements regarding their ability to incur additional indebtedness
ranking pari passu or senior to the participation under such Financing Agreements.
The composition of the Portfolio Companies is based on the "probability of default credit ratings"
assigned to the Portfolio Companies using the Moody's KMV RiskCalc™ tool and the decision
process of the investment board of the Issuer, which made use of the opinion of a second adviser
regarding the Portfolio Companies. No other investigation has been made into the Portfolio
Companies by any party to the Transaction.
The Portfolio Companies with which the Issuer enters into Financing Agreements have been selected
by the Issuer based on the "probability of default credit ratings" assigned to such Portfolio Companies
using the Moody's KMV RiskCalc™ tool with a view to achieving a certain target average credit
quality and diversification of the portfolio of companies as indicated by the "probability of default
credit ratings". The final selection has been made by the investment board of the Issuer, which also
used the opinion of an independent second adviser. Other than that, none of the parties involved in the
transaction has made any investigation into the matters of the Portfolio Companies, including into
matters which would be considered in connection with the assessment of a qualitative credit rating.
Accordingly, none of the parties to the transaction can assume any liability in connection with the
potential inability of Portfolio Companies to meet their payment obligations under the Financing
Agreements.
The "probability of default credit ratings" determined for the Portfolio Companies using the
Moody's KMV RiskCalc™ tool does not involve a qualitative assessment of the relevant Portfolio
Company. They are purely retrospective as they rely on the accuracy of historical financial
statements produced and provided by the Portfolio Companies and a comparison of the financial
data contained in those financial statements with statistical data maintained by Moody's.
This Offering Circular refers to "probability of default credit ratings" determined for the Portfolio
Companies using the Moody's KMV RiskCalc™ tool (see "The Portfolio Companies – Overview" and
"The Portfolio Companies – Individual Portfolio Company Probability of Default Rating Data and
Financial Ratios"). The basis on which the probability of default credit ratings have been assigned to
the Portfolio Companies is Moody's KMV RiskCalc™ tool ("MKMV"). The assessment of the risk
that a debtor will, within the next five years, be unable to meet any of its payment obligations within 90
days after such obligation falls due ("probability of default") generated by the MKMV is limited to a
statistical analysis of the audited financial statements provided by the Portfolio Companies. It does not
include any qualitative assessment of the Portfolio Companies such as the market position of its
products and services, its competitive position and the quality of its management. Furthermore, it does
not take into account, on an individual debtor basis, particular risk-enhancing circumstances, such as
the relevant Portfolio Company forming part of a group of companies, a Portfolio Company's
participation in group-wide cash pooling arrangements as a creditor to its affiliate, or the existence of
domination and/or profit and loss absorption agreements under which the Portfolio Company may be
dominated party (that is, effectively managed by and/or financially integrated with) an affiliate. The
statistical analysis involves only a comparison of the financial data provided by a company against
benchmark financial ratios generated by MKMV on the basis of a database of historical financial
information of a large number of companies. The probability of default credit ratings assigned by
MKMV to the Portfolio Companies using MKMV as set out in this Offering Circular are therefore not
comparable to public ratings assigned by Moody's.
The probability of default credit ratings assigned using MKMV rely on the accuracy of the financial
statement data provided by the Portfolio Companies. The audited financial statement data provided by
the Portfolio Companies has not been and will not be independently reviewed or verified by MKMV,
Moody's or any other party involved in the Transaction. Neither MKMV, Moody's nor any other party
to the Transaction gives any statement as to the accuracy of such audited financial statement data.
Moreover, there can be no assurance that the actual probability of some or all of the Portfolio
Companies becoming unable to meet their payment obligations prior to the full repayment of the
Compartment 2 Notes is not higher than is implied by the probability of default ratings set forth in this
Offering Circular. It is intended that the probability of default ratings of each of the Portfolio
Companies will be updated on an annual basis prior to the Scheduled Redemption Date using MKMV.
39
The probability of default ratings set forth in this document are therefore subject to change depending
on the future financial information available for the Portfolio Companies.
For further information regarding the "probability of default ratings" and the risks associated therewith,
see "The Portfolio Companies – Individual Portfolio Company Probability of Default Rating Data and
Financial Ratios".
The financial condition of the Portfolio Companies may have changed since the date of the financial
information on which the probability of default rating assigned to the Portfolio Companies under
Moody's KMV RiskCalc™ tool and contained in this Offering Circular was based.
The financial information upon which the probability of default ratings assigned to the Portfolio
Companies under MKMV are based and which are reflected in the tables and descriptions in "The
Portfolio Companies" are derived from the latest published audited financial statements provided by
the Portfolio Companies for their respective fiscal years. Audited financial results for the Portfolio
Companies as of any later date were not completed or not available at the time of preparation of this
Offering Circular. As a result, the current financial status of each Portfolio Company, including its
recent income and assets, may vary from its financial status as portrayed in this Offering Circular. Any
deterioration of a Portfolio Company's financial condition may adversely affect its ability to make
Fixed Interest Payments and Private Portfolio Company Advance repayments or Interest Payments and
Public Portfolio Company Advance repayments, as the case may be to the Issuer.
The risk that payments under the Compartment 2 Notes may not be made in full due to defaults by
Portfolio Companies is correlated to the concentration of the Advances in any one Portfolio
Company, industry or region.
The subordination levels of each of the classes of the Compartment 2 Notes have been established to
reflect certain assumed deficiencies in payment caused by defaults on the related Financing
Agreements. If, however, actual payment deficiencies exceed such assumed levels, payments on the
Compartment 2 Notes could be adversely affected. Whether and by how much defaults on the
Compartment 2 Notes adversely affect each class of Compartment 2 Notes will be directly related to
the level of subordination thereof pursuant to the Priority of Payments. The risk that payments on the
Compartment 2 Notes could be adversely affected by defaults on the related Financing Agreements is
likely to be increased to the extent that the Advances are concentrated in any one issuer, industry,
region or country as a result of the increased potential for correlated defaults in respect of a single
issuer or within a single industry, region or country as a result of downturns relating generally to such
industry, region or country. Investors should note in this regard that all of the Portfolio Companies are
located in Germany.
The amount of the proceeds realised upon the sale of the rights and obligations under a Financing
Agreement is likely to be significantly less than the amount of the corresponding Advance.
In the event that the rights and obligations of the Issuer in relation to a Financing Agreement are sold
by the Issuer in accordance with the terms and conditions of such Financing Agreement, it is extremely
unlikely that the full nominal book value of the Advance under such Financing Agreement can be
realised upon such sale. The extent of the proceeds that may be realised upon such sale will necessarily
depend upon the existence of a secondary market for the distressed Financing Agreements and on the
prevailing market conditions at such time and the performance of the Recovery Manager who will be
responsible for managing such recovery process. Moreover, since Financing Agreements will only
become subject to sale upon the occurrence of certain credit events, it is likely that the Issuer will
experience a significant discount against the amount of the Advance upon the sale of Financing
Agreements. In addition, a sale of a Financing Agreement is subject to certain transfer restrictions and
conditions, including consent requirements, as well as notice requirements and rights of first refusal,
which may delay the sale and possibly reduce the value of the Financing Agreement. To the extent that
the Issuer is unable to realise the full initial nominal book value of a Financing Agreement upon a sale,
its ability to redeem in full the Outstanding Principal Amount of the Compartment 2 Notes will be
materially and adversely affected.
40
Certain Permitted Investments may be subject to investment risk.
Pursuant to the Cash Administration Agreement, the Cash Administrator, as directed by the
Transaction Adviser, will invest, on behalf of the Issuer, amounts standing to the credit of the Accounts
in Permitted Investments with deposit institutions having appropriate ratings, as specified in the terms
and conditions of the Trust Deed. However, it may be the case that such Permitted Investments will be
irrecoverable due to insolvency of a debtor under such Permitted Investments or of a financial
institution involved or due to the loss of an investment amount during the transfer thereof. In such case,
none of the Cash Administrator, the Trustee, the Issuer, the Initial Purchasers, any Agent, the
Transaction Adviser or the Recovery Manager will be responsible for such loss or shortfall.
III.
Risks relating to the Compartment 2 Notes
The payment obligations of the Issuer under the Compartment 2 Notes are conditional and limited
recourse obligations.
The Issuer will have no assets available for payment of Coupon Payments and Capital Payments other
than Available Distribution Funds actually received and available for use by the Issuer in respect of its
Compartment 2 prior to the respective Payment Dates. Assets and proceeds of the Issuer in respect of
compartments other than Compartment 2 will not be available for payments under the Compartment 2
Notes. Claims in respect of any shortfall on a Payment Date will be payable on each following
Payment Date until paid in full and failure by the Issuer to make payment in respect of any such
shortfall will not constitute a default by the Issuer for any purpose. Any Coupon Payments so deferred
will not earn interest. Claims in respect of any shortfall in respect of payments under the Compartment
2 Notes shall be extinguished on the Legal Maturity Date and failure by the Issuer to make payment in
respect of any such shortfall will not constitute a default by the Issuer for any purpose. If on the Legal
Maturity Date such funds prove ultimately insufficient (after payment of all claims ranking in priority
to amounts due under the Compartment 2 Notes, see below "Coupon Payments and Capital Payments
on the Class A Notes are subordinated to the Issuer's obligations to pay certain fees, costs and
expenses", "Coupon Payments and Capital Payments under the Class B Notes are subordinated to the
Issuer's payment obligations to all other obligations of the Issuer, including payment claims under the
Class A Notes, other than the Junior Notes" and "Coupon Payments and Capital Payments under the
Junior Notes are subordinated to all other payment obligations of the Issuer, including payment claims
under the Senior Notes"), then the Issuer shall not be liable for any shortfall arising.
Coupon Payments and Capital Payments on the Class A Notes are subordinated to the Issuer's
obligations to pay certain fees, costs and expenses.
In the distribution of the Available Distribution Amounts on the Payment Dates, certain ongoing fees,
costs and expenses payable by the Issuer rank ahead of the Coupon Payments and the Capital Payments
on the Class A Notes pursuant to the Trust Deed. (See the "Summary of the Terms and Conditions of
the Compartment 2 Notes" under the heading "Priority of Payments" as well as "Description of the
Other Transaction Documents — Description of the Trust Deed".) Accordingly, claims of the holders
of the Class A Notes for Coupon Payments and Capital Payments are subject to the full prior payment
in each case of such fees, costs and expenses. Although the Issuer intends that the Quarterly Payments
and the repayment of Advances under the Financing Agreements will suffice for the Issuer to be able to
pay such fees, costs and expenses as well as Coupon Payments and Capital Payments on the Class A
Notes in full and although any unplanned shortfall in Quarterly Payments and the repayment of
Advances will first impact on Coupon Payments and Capital Payments under the Junior Notes (see
"Coupon Payments and Capital Payments under the Junior Notes are subordinated to the Issuer's
payment obligations to all other obligations of the Issuer, including payment claims under the Senior
Notes") and then on Coupon Payments and Capital Payments under the Class B Notes (see "Coupon
Payments and Capital Payments under the Class B Notes are subordinated to the Issuer's payment
obligations to all other obligations of the Issuer, including payment claims under the Class A Notes,
other than the Junior Notes"), there is no assurance that this will be the case. In such instance the Issuer
could be left with insufficient funds to pay the full amount of the Coupon Payments or the Capital
Payments on the Class A Notes, as the case may be. Fees, costs and expenses that rank ahead of the
Class A Coupon Payments or the Capital Payments under the Class A Notes are Maintenance Expenses
(as defined herein) and Administrative Expenses, up to, in the aggregate in any Due Period, the
Administrative Expenses Cap of €800,000. Any portion of the aggregate Administrative Expenses in an
Accrual Period that is greater than the Administrative Expenses Cap will rank behind the Senior Notes
41
but ahead of the Junior Notes. See "Coupon Payments and Capital Payments under the Junior Notes are
subordinated to all other payment obligations of the Issuer, including payment claims under the Class
A Notes and the Class B Notes" below.
The Swap Settlement Payments also rank ahead of the Class A Coupon Payments and the Capital
Payments under the Class A Notes and will be paid in addition to the fees, costs and expenses listed
above.
In addition to the fees, costs and expenses listed above, if a Recovery Manager Recoveries Fee is due
and payable, it will be paid when due ahead of the Compartment 2 Notes but only up to the amount of
any Recoveries actually received by or on behalf of the Issuer.
For further information on the priority of fees and costs, see "Summary of the Terms and Conditions of
the Compartment 2 Notes – Priority of Payments".
Coupon Payments and Capital Payments under the Class B Notes are subordinated to all other
obligations of the Issuer, including payment claims under the Class A Notes, other than the Junior
Notes.
On each Payment Date, the entitlement of the holders of the Class B Notes to receive Class B Coupon
Payments is subordinated to the entitlement of the holders of the Class A Notes to receive Class A
Coupon Payments and, on or after the Scheduled Redemption Date, to the Capital Payment on the
Class A Notes (for such Capital Payments on the Class A Notes, see "The Senior Notes may be subject
to partial early redemption from time to time").
On the Scheduled Redemption Date, the entitlement of the holders of the Class B Notes to receive
Class B Coupon Payments and Capital Payments in respect of the Class B Notes is subordinated to the
entitlement of the holders of the Class A Notes to receive Class A Coupon Payments and Capital
Payments in respect of the Class A Notes. On the Legal Maturity Date, the entitlement of the holders of
the Class B Notes to receive Class B Coupon Payments, if any, and any remaining Capital Payments in
respect of the Class B Notes is subordinated to the entitlement of the holders of the Class A Notes to
receive Class A Coupon Payments, if any, and any remaining Capital Payments in respect of the Class
A Notes. The entitlement of the holders of the Compartment 2 Notes to distributions and payments of
principal are subordinated to the obligations of the Issuer to pay certain of its operating expenses on
each Payment Date (for such expenses, see "Coupon Payments and Capital Payments on the Class A
Notes are subordinated to the Issuer's obligations to pay certain fees, costs and expenses").
Coupon Payments and Capital Payments under the Junior Notes are subordinated to all other
payment obligations of the Issuer, including payment claims under the Class A Notes and the Class
B Notes.
On each Payment Date, the entitlement of the holders of the Junior Notes to receive Junior Coupon
Payments is subordinated to the entitlement of the holders of the Class A Notes to receive Class A
Coupon Payments and Capital Payments on the Class A Notes and to the entitlement of the holders of
the Class B Notes to receive Class B Coupon Payments and Capital Payments on the Class B Notes
(for such Capital Payments on the Class A Notes and the Class B Notes, see "The Senior Notes may be
subject to partial early redemption from time to time").
On the Scheduled Redemption Date, the entitlement of the holders of the Junior Notes to receive Junior
Coupon Payments and Capital Payments in respect of the Junior Notes is subordinated to the
entitlement of the holders of the Class A Notes to receive Class A Coupon Payments and Capital
Payments in respect of the Class A Notes and to the entitlement of the holders of the Class B Notes to
receive Class B Coupon Payments and Capital Payments in respect of the Class B Notes. On the Legal
Maturity Date, the entitlement of the holders of the Junior Notes to receive Junior Coupon Payments, if
any, and any remaining Capital Payments in respect of the Junior Notes is subordinated to the
entitlement of the holders of the Class A Notes to receive Class A Coupon Payments, if any, and any
remaining Capital Payments in respect of the Class A Notes and to the entitlement of the holders of the
Class B Notes to receive Class B Coupon Payments, if any, and any remaining Capital Payments in
respect of the Class B Notes. The entitlement of the holders of the Compartment 2 Notes to
distributions and payments of principal are subordinated to the obligations of the Issuer to pay certain
of its operating expenses on each Payment Date (for such expenses, see "Coupon Payments and Capital
42
Payments on the Class A Notes are subordinated to the Issuer's obligations to pay certain fees, costs
and expenses").
In addition, on each Payment Date, (i) the Senior Placement Fee (as defined herein) and (ii) that portion
(if any) of the Administrative Expenses that is greater than Administrative Expenses Cap rank ahead of
the Junior Coupon Payments and Capital Payments in respect of the Junior Notes, but behind the
Floating Senior Coupon Payments and Capital Payments in respect of the Senior Notes.
As a result of the subordination of the Junior Notes as described above, if any Portfolio Companies are
unable, or fail for other reasons, to make Quarterly Payments and/or repayments on Advances, or if any
of the other parties to the Transaction Documents fail to fulfil their obligations thereunder, or if the
operating costs and fees of the Issuer are higher than expected, the Issuer is likely to be wholly or
partially unable to make Junior Coupon Payments and/or Capital Payments in respect of the Junior
Notes. In particular, if a Principal Deficiency Event occurs so as to give rise to a debit balance in the
Principal Deficiency Ledger, Available Distribution Funds received by the Issuer will be used by the
Issuer on the next following Payment Date in or towards the reduction, by way of a partial early
redemption of the Class A Notes (or, if the Class A Notes have been fully redeemed, the Class B
Notes), of the Principal Deficiency which has been entered into the Principal Deficiency Ledger to zero
(see "The Senior Notes may be subject to partial early redemption from time to time"). Early
redemption payments by the Trustee to the holders of the Class A Notes in respect of a debit balance
recorded on the Principal Deficiency Ledger will rank junior to certain fees, costs and expenses of the
Issuer as well as to Class A Coupon Payments and Class B Coupon Payments payable on the relevant
Payment Date, but senior to Capital Payments on the Class B Notes, the Junior Coupon Payments and
Capital Payments in respect of the Junior Notes. Early redemption payments by the Issuer to the
holders of the Class B Notes in respect of a debit balance recorded on the Principal Deficiency Ledger
(after the redemption in full of the Class A Notes) will rank junior to certain fees, costs and expenses of
the Issuer as well as to Class B Coupon Payments payable on the relevant Payment Date, but senior to
Capital Payments in respect of the Class B Notes and to Junior Coupon Payments and Capital
Payments in respect of the Junior Notes. As a result, the occurrence of a Principal Deficiency Event
prior to the Scheduled Redemption Date would first affect the ability of the Issuer to make Coupon
Payments on the Junior Notes. If, however, the Available Distribution Funds available on or after the
Scheduled Redemption Date were to be insufficient to make all payments under the Compartment 2
Notes falling due on such dates, such shortfall would first affect the claims of the holders of the Junior
Notes for redemption and thereafter their claims for Junior Coupon Payments. Furthermore, a claim for
any such shortfall after all Available Distribution Funds have been distributed on the Legal Maturity
Date in accordance with the Priority of Payments will be extinguished. Claims against the Issuer by
holders of the Compartment 2 Notes and each other secured party will be limited to the Compartment 2
Collateral. If the net proceeds of the enforcement of the Compartment 2 Collateral are not sufficient to
make all payments due in respect of the Compartment 2 Notes and, if applicable, due to each other
Secured Party, no other assets of the Issuer will be available to meet such shortfall and the claims of
holders of the Compartment 2 Notes and each other secured party in respect of any such shortfall shall
be extinguished and no such party will be able to petition for the winding-up of the Issuer as a
consequence of any such shortfall.
The Compartment 2 Notes may be subject to partial early redemption from time to time.
The Class A Notes are subject to early partial redemption on each Payment Date on which the Principal
Deficiency Ledger shows any debit balance out of amounts available for that purpose in accordance
with item "twelfth" of the Priority of Payments. If the Class A Notes have been redeemed in full prior
to the Scheduled Redemption Date, then the Class B Notes will be subject to early partial redemption
on each such Payment Date on which the Principal Deficiency Ledger shows any debit balance out of
amounts available for that purpose in accordance with item "thirteenth" of the Priority of Payments. If
the Class A Notes and the Class B Notes have been redeemed in full prior to the Scheduled
Redemption Date, then the Junior Notes will be subject to early partial redemption on each such
Payment Date on which the Principal Deficiency Ledger shows any debit balance out of amounts
available for that purpose in accordance with item "eighteenth" of the Priority of Payments.
43
Early redemption of the Compartment 2 Notes in case of the early termination of a Financing
Agreement.
The Issuer has covenanted that Advances (as defined below) under the Financing Agreements will be
declared due and payable on the Scheduled Redemption Date. However, under German law, the
statutory right of either party to terminate agreements such as the Financing Agreements prematurely in
extraordinary circumstances (aus wichtigem Grund) cannot be contractually excluded. Under the terms
of the Financing Agreements, such extraordinary circumstances for the Issuer include, among others:
•
the liquidation of the Portfolio Company;
•
the institution of insolvency proceedings against the Portfolio Company or the dismissal of a
petition to open such proceedings against a Portfolio Company due to insufficient assets;
•
the failure of the Portfolio Company to prepare audited financial statements within the time
period prescribed by law;
•
a change of control regarding the Portfolio Company or other action outside the normal course of
the Portfolio Company's business if the Issuer's legal status or economic interests are thereby
materially impaired;
•
a breach of the Portfolio Company's informational obligations under the Financing Agreement;
and
•
distributions to shareholders during such time as any Fixed Interest Payment or Interest Payment,
as applicable, or repayment of Advances has not been paid in full.
If the Issuer or a Portfolio Company chooses to exercise its early termination right, the Portfolio
Company is obliged to repay the Advance together with the Make-Whole Amount, if any, under the
relevant Financing Agreement prior to the Scheduled Redemption Date. When such early termination
becomes effective, the sum of the amount of the Advance and the Make-Whole Amount, if any, will be
deemed a Principal Deficiency and recorded as a debit in the Principal Deficiency Ledger (unless a
Principal Deficiency Amount had already occurred in connection with such Financing Agreement, in
which case only the Make-Whole Amount, if any, would be recorded as a debit in the Principal
Deficiency Ledger). The debit balance in the Principal Deficiency Ledger, if any, is reduced on each
Payment Date by the amount of any payments made to the holders of the Class A Notes in accordance
with paragraph (I) of the Priority of Payments (or, if the Class A Notes have been redeemed in full, to
the holders of the Class B Notes in accordance with paragraph (J) of the Priority of Payments; or, if
both the Class A Notes and the Class B Notes have been redeemed in full, to the holders of the Junior
Notes in accordance with paragraph (S) of the Priority of Payments). Subject to the availability of
sufficient Available Distribution Funds, the Class A Notes (or, as applicable, the Class B Notes or the
Junior Notes) will thus be subject to partial early redemption on each Payment Date on which Principal
Deficiencies are recorded in the Principal Deficiency Ledger on a pro rata basis in the amount of these
payments. The funds used by the Issuer to prematurely redeem Class A Notes (or, as applicable, Class
B Notes or the Junior Notes) on account of Principal Deficiencies may include the repaid Advance and
any Make-Whole Amount received by the Issuer in connection with such early termination to the
extent that these are not paid out for items ranking higher on the Priority of Payments. The recording of
a debit in the Principal Deficiency Ledger, however, may not result in the Issuer redeeming
Compartment 2 Notes early, since this will depend upon the amount of Available Distribution Funds on
the following Payment Dates, which may in turn depend upon whether Early Repayment Amounts
have been received under any Financing Agreements.
Early redemption of the Compartment 2 Notes in case of a Payment Default under or the sale of a
Financing Agreement.
The Compartment 2 Notes may be subject to early partial redemption in the event that the rights and
obligations of the Issuer under a Financing Agreement may be sold by the Issuer in accordance with its
terms and conditions. Pursuant to the terms of the Financing Agreements, the Issuer is entitled to sell
and transfer a Financing Agreement (subject to the restrictions and conditions set out in the Financing
Agreement) upon the occurrence of (among other things) a Payment Default. Upon the occurrence of a
Payment Default, the amount of the Advance under such Financing Agreement will be recorded as a
Principal Deficiency in the Principal Deficiency Ledger. In addition, if a Financing Agreement is sold
44
in circumstances other than after the prior occurrence of a Payment Default or other Principal
Deficiency Event with regard to such Financing Agreement, the amount of the Advance under the sold
Financing Agreement will be entered as a debit in the Principal Deficiency Ledger. The debit balance
in the Principal Deficiency Ledger, if any, is reduced on each Payment Date by the amount of any
payments made to the holders of the Class A Notes in accordance with paragraph (J) of the Priority of
Payments (or, if the Class A Notes have been redeemed in full, to the holders of the Class B Notes in
accordance with paragraph (K) of the Priority of Payments; or, if both the Class A Notes and the Class
B Notes have been redeemed in full, to the holders of the Junior Notes in accordance with paragraph
(R) of the Priority of Payments). Subject to the availability of sufficient Available Distribution Funds,
the Class A Notes (or, as applicable, the Class B Notes or the Junior Notes) will thus be subject to
partial early redemption on each Payment Date on which Principal Deficiencies are recorded in the
Principal Deficiency Ledger on a pro rata basis in the amount of these payments. The funds used by
the Issuer to prematurely redeem Class A Notes (or, as applicable, Class B Notes or the Junior Notes)
on account of Principal Deficiencies may include Recoveries received by the Issuer in connection with
the sale of the relevant Financing Agreement to the extent that these are not paid out for items ranking
higher on the Priority of Payments.
The following events constitute Principal Deficiency Events:
•
the liquidation of a Portfolio Company;
•
the institution of insolvency proceedings against a Portfolio Company or the dismissal of a
petition to open such proceedings against a Portfolio Company on the grounds that such Portfolio
Company has insufficient assets (pursuant to Section 26 of the German Insolvency Code);
•
the failure of a Portfolio Company on two consecutive occasions to pay the Fixed Interest
Payments or Interest Payments, as applicable, when due under the relevant Financing
Agreement;
•
the total amount of overdue payments on Fixed Interest Payments is equal to or exceeds the
amount payable as Fixed Interest Payments or Interest Payments on account of two Three Month
Periods;
•
the sale of the Issuer's rights and interests in a Financing Agreement; and
•
the termination of a Financing Agreement prior to the Scheduled Redemption Date;
but only to the extent that such event does not cause the Advance (and any Make-Whole Amount)
under a Financing Agreement to be double-booked into the Principal Deficiency Ledger.
The recording of a debit in the Principal Deficiency Ledger, however, may not result in the Issuer
redeeming Compartment 2 Notes early, since this will depend upon the amount of Available
Distribution Funds on the following Payment Dates, which may in turn depend upon whether Early
Repayment Amounts have been received under any Financing Agreements and/or on whether the sale
and transfer of such Financing Agreements is permissible and effective and on the amount of
Recoveries received from such a sale and transfer.
A default by the Swap Counterparty under the Swap Agreement or the termination of the Swap
Agreement may reduce the amount available to the Issuer for payment of the amounts due under the
Compartment 2 Notes and may entail a loss of rating.
In the event that the Swap Counterparty does not pay the amount payable by the Swap Counterparty
under the Swap Agreement when due, Available Distribution Funds may be less than would otherwise
be the case. In addition, if the Swap Agreement were terminated, the Issuer would be obliged to use
Available Distribution Funds to pay any default or breakage costs under the Swap Agreement. Either
situation could result in less Available Distribution Funds than would otherwise be the case and result
in reduced payments to Compartment 2 Noteholders, subject to the Priority of Payments.
Furthermore, if the Swap Counterparty were to default in respect of its obligations under the Swap
Agreement so as to result in a termination of the Swap Agreement, the Issuer will be obliged to enter
into a replacement arrangement with another appropriately rated entity. A failure to enter into such a
replacement arrangement may result in a downgrading on the rating of the Compartment 2 Notes, as
45
applicable, and may reduce the amount of funds available to make payments on the Compartment 2
Notes.
Performance under the Compartment 2 Notes depends on, among other things, the performance of
third parties.
The performance of any investment in the Compartment 2 Notes will be in part dependent upon the
performance by the other third parties of their respective obligations under the Transaction Documents,
including without limitation the Swap Counterparty, the Transaction Adviser, the Trustee and the
Recovery Manager and the refund to be made to the Issuer by the German tax authorities described
below in "Risk Factors - Withholding Tax Refund". Notwithstanding that such performance is
contractually required, no assurance can be given with respect to the performance of such obligations.
Furthermore, the liability of any such party in the event of inadequate performance or non-performance
may be limited by the provisions of the relevant contract (such as to fraud, wilful default or gross
negligence). In such case, the ability of the Issuer to recover damages incurred may be reduced, which
would in turn affect the amount available to make payments under the Compartment 2 Notes.
Withholding Tax Refund
The Portfolio Companies may be obliged to withhold withholding tax on the Fixed Interest Payments
under the Financing Agreements. In this event, the Issuer will make an application to the German tax
authorities for a refund of the withheld tax. On the basis of the double taxation treaty between
Germany and Luxembourg, the Issuer has a valid claim against the Federal Republic of Germany for a
refund of the withheld tax. German tax law provides for abuse of law provisions which may exclude
non-German entities from filing refund claims for withheld taxes if a non-German entity does not have
sufficient substance or if no business reasons exist for the use of the non-German entity. The Issuer has
received satisfactory legal advice from German counsel in relation to this risk and is of the opinion that
such a tax refund claim will not be refused. The Issuer proposes to enter into the Loan Agreement on
or before the Issue Date in order to permit it to draw down funds from the Lender up to an aggregate
principal amount of €2,000,000 in order to permit the Issuer to make up any shortfall arising as a result
of such withholding tax. See "Description of the Other Transaction Documents – Description of the
Loan Agreement".
Payments under the Compartment 2 Notes will not be grossed up in the event that tax on such
payments must be withheld.
In the event that any withholding tax or deduction for tax is imposed on payments of interest on the
Compartment 2 Notes, the holders of the Compartment 2 Notes will not be entitled to receive grossedup amounts to compensate for such withholding tax and no default shall occur as a result of any such
withholding or deduction.
The ability of the Issuer to redeem the Compartment 2 Notes in the event of their acceleration prior
to the Scheduled Redemption Date is limited.
If the Compartment 2 Notes were to be accelerated for any reason prior to the Scheduled Redemption
Date, the Issuer would be required to redeem the Outstanding Principal Amounts owed under the
Compartment 2 Notes without having received repayments of the Advances under the Financing
Agreements. In this situation, the Issuer would have neither the right or obligation to require the
Portfolio Companies to immediately repay their Advances nor the right or obligation to sell the
Financing Agreements without the relevant Portfolio Company's consent (except with regard to those
Portfolio Companies that had caused a Payment Default or had failed to meet the minimum rating
requirement set out in the Financing Agreements or with regard to the claims arising from the
Financing Agreements). As a result, even upon the acceleration of the Compartment 2 Notes, the
amount of Available Distribution Funds on each Payment Date would not change and would be
distributed as before in accordance with the Priority of Payments. It is therefore highly likely that the
Issuer would not be able to redeem in full (and possibly not in part) the Outstanding Principal Amounts
owed under the Compartment 2 Notes until the Scheduled Redemption Date.
Agreements governed by German Law may be subject to General Termination Rights.
The Financing Agreements are governed by German law. Under German law, the right to terminate
continuous contracts (Dauerschuldverhältnis) in extraordinary circumstances (Kündigungsrecht aus
46
wichtigem Grund) cannot be excluded. Even though the circumstances under which such a termination
right exists are limited, there can be no assurance that a party to any of those agreements will not assert
the existence of such a termination right in the future.
There has been no prior market for the Compartment 2 Notes.
There is no active trading market for the Compartment 2 Notes and any market which develops may be
volatile. Although application has been made to list the Compartment 2 Notes on the Irish Stock
Exchange, there can be no assurance regarding the future development of a market for the
Compartment 2 Notes or the ability of holders of the Compartment 2 Notes to sell their Compartment 2
Notes or the price at which such holders may be able to sell their Compartment 2 Notes. In addition,
the liquidity of the trading market in the Compartment 2 Notes may be adversely affected by changes
in the overall market for investment and non-investment grade securities. If such a trading market were
to develop, the Compartment 2 Notes could trade at prices that may be higher or lower than the initial
offering price depending on many factors including prevailing interest rates, the market for similar
securities and the operating results and credit quality of the Portfolio Companies. Therefore, there can
be no assurance as to the liquidity of any trading market for the Senior Notes or that an active public
market for the Senior Notes will develop. Consequently, a purchaser of the Compartment 2 Notes must
be prepared to hold any Compartment 2 Notes.
It is intended that all or part of the Junior Notes will be sold to a single financial institution which will
issue other securities to investors pursuant to which cash flows received by such financial institution
under the Junior Notes will be passed on to holders of such securities. In that event, Junior Notes
purchased by such financial institution may be held by it permanently. This would have the effect of
severely restricting any trading in the Junior Notes.
Volatility of Junior Notes
The Junior Notes represent a leveraged investment of the Financing Agreements. It is therefore
anticipated that changes in the market value of the Junior Notes will be greater than changes in the
market value of the Financing Agreements.
The future ratings of the Senior Notes are not assured and may be limited in scope.
It is a condition of the issue and sale of the Compartment 2 Notes that the Class A Notes be rated "Aaa"
by Moody's and "AAA" by Fitch and that the Class B Notes be rated at least "A1" by Moody's and
"A+" by Fitch. The ratings address the expected loss posed to investors by the legal final maturity.
Moody's ratings address only the credit risks associated with the Transaction. Other non-credit risks
have not been addressed, but may have a significant effect on the yield to investors. A rating is not a
recommendation to buy, sell or hold the Class A Notes or the Class B Notes, in as much as such rating
does not comment as to market price or suitability for a particular investor. There is no assurance that a
rating will remain for any given period of time or that a rating will not be lowered or withdrawn
entirely by Moody's or Fitch if, in its judgment, circumstances in the future so warrant. In the event that
a rating initially assigned to the Class A Notes or Class B Notes is subsequently lowered or withdrawn
for any reason, no person or entity is obliged to provide any additional support or credit enhancement
with respect to such Compartment 2 Notes and the market value of such Compartment 2 Notes is likely
to be adversely affected.
Average Life and Prepayment Considerations
The average life of the Compartment 2 Notes of each class may be different than the number of years
until their Scheduled Redemption Date or Legal Maturity Date. No assurance can be made as regards
the exact average life of any of the Compartment 2 Notes. Average life refers to the average amount of
time that will elapse from the date of issue of each class of Compartment 2 Notes until amounts in
respect of principal of such Compartment 2 Notes have been paid to the holder thereof. The average
life of the Compartment 2 Notes of each class will be affected by: (a) the structure of the Compartment
2 Notes (including payment priorities), (b) the financial condition of the Portfolio Companies under the
Financing Agreements, (c) the characteristics of such Financing Agreements, including the existence
and ability to exercise and frequency of exercise of any early termination rights or transfer rights or
other similar right and the amount and timing of receipt of Early Repayment Amounts and/or
47
Recoveries, (d) the actual level and timing of recoveries on or amounts realised on sale of any
defaulted Financing Agreements and (e) mandatory redemption of the Compartment 2 Notes.
Other Commercial Relationships of the Parties Involved
Each of the Portfolio Companies, the Transaction Adviser, the Recovery Manager, the Swap
Counterparty, the Initial Purchasers, the Lender and/or any of its affiliates may engage in on-going
commercial relationships with each other, and with other transaction parties, that are unrelated to the
Transaction. In such relationships, neither a Portfolio Company, the Transaction Adviser, the Recovery
Manager, the Swap Counterparty, the Initial Purchasers nor any of their affiliates will be obliged to
take into account the interests of the Compartment 2 Noteholders. As a consequence of such
relationships, potential or actual conflicts of interest may arise in relation to the Transaction.
48
TERMS AND CONDITIONS OF THE COMPARTMENT 2 NOTES
The full text of the terms and conditions of the Compartment 2 Notes is set out below. As the Issuer's
payment obligations under the Compartment 2 Notes are contingent on actual receipt by the Issuer of
sufficient Available Distribution Funds, potential investors should carefully review and consider the
provisions of the Profit Participation Agreements (which can be found under "Description of the Other
Transaction Documents – Terms and Conditions of the Profit Participation Agreements") and the
provisions of the Subordinated Loan Agreements (which can be found under "Description of the Other
Transaction Documents – Terms and Conditions of the Subordinated Loan Agreements").
TERMS AND CONDITIONS
of the
€218,400,000 Class A Compartment 2 Floating Rate Notes due 2014
€30,800,000 Class B Compartment 2 Floating Rate Notes due 2014
€30,800,000 Junior Compartment 2 Notes due 2014
issued by
H.E.A.T Mezzanine S.A.
(a société anonyme incorporated under the laws of Luxembourg
Having its registered office at 1-7 rue Nina et Julien Lefèvre, L-1952 Luxembourg and registered with
the Luxembourg Trade and Companies register under number B-109.738)
1.
Definitions and Interpretation
Unless the context requires otherwise, the following terms will have the following meanings:
"Account Bank" means BNP Paribas, Luxembourg branch, which term shall include any successor or
substitute account bank appointed in accordance with the Paying Agency Agreement.
"Accounts" means the Issuer Account and the Expenses Reserve Account.
"Accrual Period" means each period commencing on (but including) a Payment Date and ending on
(but excluding) the following Payment Date; provided that the first Accrual Period shall commence on
(and include) the Issue Date and end on (but exclude) the first Payment Date.
"Actual/Actual ISMA Day Count Fraction" means the following day count fraction methodology for
the purposes of calculating interest:
(a)
if the Accrual Period is equal to or shorter than the Determination Period during which the
Accrual Period ends, the number of days in such Accrual Period divided by the product of (1)
the number of days in such Determination Period and (2) the number of Payment Dates that
would occur in one calendar year; or
(b)
if the Accrual Period is longer than the Determination Period during which the Accrual Period
ends, the sum of:
(i)
the number of days in such Accrual Period falling in the Determination Period during
which the Accrual Period begins divided by the product of (x) the number of days in
such Determination Period and (y) the number of Payment Dates that would occur in
one calendar year; and
(ii)
the number of days in such Accrual Period falling in the next Determination Period
divided by the product of (x) the number of days in such Determination Period and (y)
the number of Payment Dates that would occur in one calendar year.
"Administrative Expenses" means, collectively, all fees, costs and expenses due and payable by the
Issuer acting on behalf of Compartment 2, payable on a pro rata basis, to:
(i)
the recipient(s) of the Corporate Administration Fees;
49
(ii)
the Agents (other than the Cash Administrator) under the Paying Agency Agreement;
(iii)
the Cash Administrator under the Cash Administration Agreement;
(iv)
the Recovery Manager of the Ongoing Recovery Manager Fee under the
Management Agreement;
(v)
the Irish Stock Exchange;
(vi)
the Rating Agencies;
(vii)
the auditors and legal counsel of the Issuer in respect of Compartment 2;
Recovery
(viii) the Transaction Adviser in respect of the Senior Transaction Adviser Fee under the Investment
Advisory Agreement;
(ix)
Trinkaus in respect of the Senior Placement Fee under the Subscription Agreement;
(x)
any further fees, costs and expenses of the Issuer payable in respect of Compartment 2 under
any of the Transaction Documents (other than (a) Maintenance Expenses, (b) any amounts
payable under the Swap Agreement and (c) any Subordinated Placement Fee ); and
(xi)
any payments to employees of the Issuer and any lease payments in respect of any premises of
the Issuer up to an aggregate amount not exceeding €75,000 in respect of each Due Period.
"Administrative Expenses Cap" with respect to each Due Period means €800,000.
"Advance Repayment Claims" means collectively, the Private Portfolio Company Advance
Repayment Claims and the Public Portfolio Company Advance Repayment Claims.
"Advances" means collectively, the Private Portfolio Company Advances and the Public Portfolio
Company Advances.
"Agents" means the Paying Agents, the Calculation Agent, the Account Bank, the Custodian and the
Cash Administrator, and "Agent" means any one of them.
"Asset Sale and Transfer Agreement" means the asset sale and transfer agreement between the Issuer
and HSBC Trinkaus & Burkhardt KGaA dated the Issue Date with respect to the acquisition by the
Issuer of the Financing Agreements.
"Available Distribution Funds" means for each Payment Date, the total amount of any Issuer
Receipts and sums drawn under the Loan Agreement (i) held by the Issuer or (ii) held or invested in
Permitted Investments by the Cash Administrator, as determined by the Transaction Adviser on behalf
of the Issuer on the immediately preceding Determination Date.
"Business Day" means a day on which TARGET (the Trans-European Automated Real Time Gross
Settlement Express Transfer system) is operating credit or transfer instructions in respect of payments
in Euro and commercial banks settle payments in the general course in Frankfurt am Main and
Luxembourg.
"Calculation Agent" means BNP Paribas Securities Services, Luxembourg branch, which term shall
include any successor or substitute calculation agent.
"Capital Payment" means the principal repayment on the Senior Notes and the payment of the Junior
Redemption Amount on the Junior Notes to which the Compartment 2 Noteholders are entitled upon
redemption of the Compartment 2 Notes.
"Cash Administration Agreement" means the cash administration agreement between the Issuer, the
Trustee, the Transaction Adviser, the Account Bank, the Custodian and the Cash Administrator dated
the Issue Date.
"Cash Administrator" means BNP Paribas Securities Services, Luxembourg branch, which term shall
include any successor or substitute cash administrator.
50
"Class A Amortisation Amount" has the meaning specified in Condition 7(1) (Amortisation of Class
A Notes).
"Class A Amortisation Schedule" means the schedule of Class A Amortisation Amounts attached
hereto as Schedule A.
"Class A Coupon Payments" has the meaning specified in Condition 6(1) (Class A Coupon
Payments).
"Class A Notes" has the meaning specified in Condition 2(1) (Denomination).
"Class A Swap" means the swap agreement entered into between the Issuer and the Swap Counterparty
with respect to the Class A Notes in order to hedge the fixed-floating rate exposure arising from Fixed
Interest Payments and Interest Payments being calculated at a fixed interest rate while Class A Coupon
Payments are calculated at six-month EURIBOR plus a margin.
"Class B Coupon Payments" has the meaning specified in Condition 6(3) (Class B Coupon
Payments).
"Class B Notes" has the meaning specified in Condition 2(1) (Denomination).
"Class B Swap" means the swap agreement entered into between the Issuer and the Swap Counterparty
with respect to the Class B Notes in order to hedge the fixed-floating rate exposure arising from Fixed
Interest Payments and Interest Payments being calculated at a fixed interest rate while Class B Coupon
Payments are calculated at six-month EURIBOR plus a margin.
"Clearing Systems" means Clearstream, Luxembourg and Euroclear.
"Clearstream, Luxembourg" means Clearstream Banking, société anonyme.
"Compartment 2" means the second compartment of the Issuer created in accordance with the
Luxembourg law of 22 March 2004.
"Compartment 2 Collateral" means the property, assets and benefits described in Condition 3(4)
(Security) which are charged and/or assigned to the Trustee from time to time for the benefit of the
Secured Parties pursuant to the Trust Deed.
"Compartment 2 Noteholder" and "holder" of a Compartment 2 Note means any bearer from time to
time of the Global Note or, after the issuance of Definitive Notes, any bearer from time to time of such
Definitive Notes.
"Compartment 2 Notes" has the meaning specified in Condition 2(1) (Denomination).
"Controlling Class" means the holders of the Class A Notes or, following redemption and payment in
full of the Class A Notes, the Class B Notes, or following redemption and payment in full of the Class
B Notes, the Junior Notes acting:
(a)
in all circumstances other than those referred to in paragraph (b) below, by Ordinary
Resolution or upon the written direction of the holders of 50 per cent. by principal amount
outstanding of the appropriate Class of Compartment 2 Notes;
(b)
in each case in which the consent, vote or direction of the Controlling Class is required in
respect of any matters relating to the occurrence or curing of an Event of Default or the
acceleration of the Compartment 2 Notes or enforcement of the security over the
Compartment 2 Collateral constituted by the Trust Deed, by Extraordinary Resolution or upon
the written direction of the holders of 66⅔ per cent. by principal amount outstanding of the
appropriate Class of Compartment 2 Notes.
"Conversion" has the meaning specified in Condition 4(3)(f) (Conversion).
"Corporate Administration Fees" means the fees payable in respect of Compartment 2 to either (i) to
the directors of the Issuer or (ii) pursuant to a corporate administration agreement entered into with the
51
Issuer, to a corporate administrator, in either case on account of services provided with respect to the
administration of the Issuer.
"Coupon Payments" has the meaning specified in Condition 6(5) (Junior Coupon Payments).
"Coupons" has the meaning specified in Condition 2(2) (Form).
"Custodian" means BNP Paribas, Luxembourg branch, which term shall include any successor or
substitute custodian appointed in accordance with the Paying Agency Agreement.
"Custody Accounts" means the Principal Custody Account and the Expenses Reserve Custody
Account;
"Definitive Notes" has the meaning specified in Condition 2(4) (Definitive Notes).
"Determination Date" means the second Business Day prior to each Payment Date.
"Determination Period" means each period from and including an Interest Determination Date to but
excluding the next Interest Determination Date (save that where the Issue Date or the relevant payment
date is not an Interest Determination Date, the period commencing on the first Interest Determination
Date prior to, and ending on, the First Interest Determination Date falling after such date.)
"Due Period" means each period from (and including) a Determination Date (or, in the case of the first
such period, the Issue Date) until (but excluding) the next following Determination Date.
"End Date" means the anniversary in 2013 of the payment of the Advances.
"EURIBOR" for each Accrual Period means the rate for deposits in euro for a period of six months
which appears on Reuters 3000 Page EURIBOR 01(or such other page as may replace such page on
that service for the purpose of displaying Brussels inter-bank offered rate quotations of major banks) as
of 11:00 a.m. (Brussels time) on the second Business Day immediately preceding the commencement
of such Accrual Period (each, a "EURIBOR Determination Date"), all as determined by the
Calculation Agent. If Reuters 3000 Page EURIBOR 01 is not available or if no such quotation appears
thereon, in each case as at such time, the Calculation Agent shall request the principal Euro-zone office
of the Reference Banks selected by it to provide the Calculation Agent with its offered quotation
(expressed as a percentage rate per annum) for six-month deposits (or for such other periods, as
referred to above) in euro at approximately 11:00 a.m. (Brussels time) on the relevant EURIBOR
Determination Date to prime banks in the Euro-zone inter-bank market for the relevant Accrual Period
and in an amount that is representative for a single transaction in that market at that time. If two or
more of the selected Reference Banks provide the Calculation Agent with such offered quotations,
EURIBOR for such Accrual Period shall be the arithmetic mean of such offered quotations (rounded if
necessary to the nearest one thousandth of a percentage point, with 0.000005 being rounded upwards).
If on the relevant EURIBOR Determination Date fewer than two of the selected Reference Banks
provide the Calculation Agent with such offered quotations, EURIBOR for such Accrual Period shall
be the rate per annum which the Calculation Agent determines as being the arithmetic mean (rounded if
necessary to the nearest one thousandth of a percentage point, with 0.000005 being rounded upwards)
of the rates communicated to (and at the request of) the Calculation Agent by major banks in the Eurozone, selected by the Calculation Agent, at approximately 11:00 a.m. (Brussels time) on such
EURIBOR Determination Date for loans in euro to leading European banks for such Accrual Period
and in an amount that is representative for a single transaction in that market at that time. "Reference
Banks" means four major banks in the Euro-zone inter-bank market. "Euro-zone" means the region
comprising member states of the European Union that have adopted the single currency, the euro, in
accordance with the EC Treaty. "EC Treaty" means the Treaty establishing the European Community
signed in Rome on 25 March 1957, as amended from time to time, including by the Treaty on
European Union signed in Maastricht on 7 February 1992.
"Euro" means the single unified currency that was introduced in Germany and other participating
member states of the European Union on 1 January 1999.
"Euroclear" means Euroclear Bank S.A./N.V. as operator of the Euroclear System.
"Events of Default" has the meaning specified in Condition 14(1) (Events of Default).
52
"Expenses Reserve" means a reserve amount payable to the Cash Administrator for investment (at the
direction of the Transaction Adviser) in Permitted Investments in an amount estimated by the Issuer to
be sufficient to cover the Wind-up Costs.
"Expenses Reserve Account" means the Euro-denominated account maintained by and in the name of
the Issuer with the Account Bank into which Issuer Receipts (other than those falling in paragraph (g)
of the definition of Issuer Receipts) will be credited and out of which sums may be paid out in
accordance with Condition 11(3) (Expenses Reserve Account).
"Expenses Reserve Custody Account" means a segregated sub account in the name of the Issuer
established by the Custodian (including any cash account associated with such segregated sub account)
into which the Permitted Investments acquired by the Cash Administrator from sums standing to the
credit of the Expenses Reserve Account will be credited.
"Extraordinary Resolution" means in relation to any Class of Compartment 2 Noteholders:
(a)
a resolution passed at a meeting duly convened and held in accordance with the Trust Deed by
a majority of at least 66 2/3 per cent. of the votes cast;
(b)
a resolution in writing signed by or (to the satisfaction of the Trustee) on behalf of the holders
of not less than 66 2/3 per cent. of the principal amount of the Compartment 2 Notes
Outstanding who are for the time being entitled to receive notice of a meeting in accordance
with the provisions contained in the Trust Deed.
"Financing Agreements" means, collectively, the Profit Participation Agreements and the
Subordinated Loan Agreements.
"Fitch" means Fitch Ratings Ltd.
"Fixed Interest Payments" has the meaning specified in Condition 4(2)(a) (Private Portfolio Company
Advances).
"Floating Senior Coupon Payments" has the meaning specified in Condition 6(2) (Class B Coupon
Payments).
"GAAP" means generally accepted accounting principles.
"German Withholding Tax" means German withholding tax (Kapitalertragsteuer) levied in
accordance with Condition 43 of the German Income Tax Act (Einkommensteuergesetz) plus the
"solidarity surcharge" (Solidaritätszuschlag).
"Global Note" has the meaning specified in Condition 2(2) (Form).
"Global Notes" has the meaning specified in Condition 2(2) (Form).
"Immediate Operating Expenses" means any Administration Expenses up to the Administration
Expenses Cap and any Maintenance Expenses, in each case, that become immediately due and payable
during each Due Period.
"Initial Purchasers" means, in connection with the Compartment 2 Notes, HSBC Bank plc and
Trinkaus.
"Interest Determination Date" means 13 October and 13 April each year.
"Interest Payment Claims" means the Issuer's claims for payment of the Interest Payments under the
Subordinated Loan Agreements.
"Interest Payments" has the meaning specified in Condition 4(3)(a) (Public Portfolio Company
Advances).
"Investment Advisory Agreement" means the investment advisory agreement between the Issuer, the
Trustee and the Transaction Adviser dated the Issue Date.
53
"Issue Date" means 13 April 2006.
"Issuer" has the meaning specified in Condition 2(1) (Denomination).
"Issuer Account" means the Euro-denominated account maintained by and in the name of the
Compartment 2 for the purpose of receiving Issuer Receipts and out of which certain payments will be
made all in accordance with the provisions of Condition 11 (The Accounts and the Custody Accounts).
"Issuer Receipts" means:
(a)
the Fixed Interest Payments and the repayment of the Private Portfolio Company Advances
from the Private Portfolio Companies under the Profit Participation Agreements;
(b)
the Interest Payments and the repayment of the Public Portfolio Company Advances from the
Public Portfolio Companies under the Subordinated Loan Agreement;
(c)
any Make-Whole Amount;
(d)
any Recoveries;
(e)
proceeds from the Permitted Investments;
(f)
any net amount paid (other than as collateral) by the Swap Counterparty to the Issuer under the
Swap Agreement;
(g)
any refund of tax paid to the Issuer which was originally deducted from the Fixed Interest
Payments or Interest Payments; and
(h)
any sums drawn down under the Loan Agreement.
"Junior Coupon Payments" has the meaning specified in Condition 6(5) (Junior Coupon Payments).
"Junior Coupon Rate Schedule" means the interest rate schedule attached hereto as Schedule C.
"Junior Notes" has the meaning specified in Condition 2(1) (Denomination).
"Junior Notional Amount" means 100 per cent. of the initial principal amount of the Junior Notes.
"Junior Redemption Amount" means the amount corresponding to any date of redemption as set out
in the Junior Redemption Amount Schedule.
"Junior Redemption Amount Schedule" means the schedule of Junior Redemption Amounts attached
hereto as Schedule B.
"Legal Maturity Date" means 13 April 2014.
"Lender" means HSBC Trinkaus & Burkhardt KGaA.
"Loan Advance" means a loan advance under the Loan Agreement.
"Loan Agreement" means the loan agreement dated the Issue Date between the Issuer and the Lender.
"Luxembourg Pledge Agreements" means the pledge agreements dated the Issue Date in each case
between the Issuer and the Trustee.
"Maintenance Expenses" means any expenses incurred in connection with:
(i)
maintaining the corporate existence of the Issuer and the Issuer's annual return, filing,
registration and registered office fees; and
(ii)
the Issuer's liability (if any) to tax in respect of Compartment 2.
"Make-Whole Amount" means, in the event of an early termination of a Financing Agreement, the
sum of all Fixed Interest Payments or Interest Payments, as applicable that would have otherwise
54
accrued through to the End Date less the expected income (net any charges) that would be realised on
such amount were it to be invested from the effective date of the early termination to the End Date in a
bond issued by the Federal Republic of Germany that matures on the End Date.
"Moody's" means Moody's Investors Service, Inc.
"Ongoing Recovery Manager Fee" means the ongoing fee payable by the Issuer to the Recovery
Manager on each Payment Date pursuant to the Recovery Management Agreement, excluding any
Recovery Manager Recoveries Fee.
"Ordinary Resolution" means, in relation to any Class of Compartment 2 Noteholders:
(a)
a resolution passed in a meeting duly convened and held in accordance with the Trust Deed by
a majority of at least 50 per cent. of the votes cast; or
(b)
a resolution in writing signed by or (to the satisfaction of the Trustee) on behalf of the holders
of not less than 50 per cent. of the principal amount of the Compartment 2 Notes Outstanding
who are for the time being entitled to receive notice of a meeting in accordance with the
provisions contained in the Trust Deed.
"Other Company" has the meaning specified in Condition 18(1) (Substitution).
"Outstanding" has the meaning set out in the Trust Deed.
"Outstanding Principal Amount" means, on any date, (a) in the case of the Senior Notes, their initial
principal amount on the Issue Date and (b) in the case of the Junior Notes, the Junior Redemption
Amount on such date, in each case less any payments made in or towards the redemption of the
relevant Compartment 2 Notes since the Issue Date.
"Participation Payment Claims" means the Issuer's claims for payment of the Fixed Interest
Payments under the Profit Participation Agreements.
"Paying Agency Agreement" means the agency agreement dated 13 April 2006 entered into between
the Agents, the Trustee and the Issuer.
"Paying Agents" has the meaning specified in Condition 17(2) (Irish Paying Agent).
"Payment Date" means 13 April and 13 October in each year commencing on 13 October 2006 up to
and including the Legal Maturity Date or any other date that the Compartment 2 Notes are to be
redeemed prior to the Legal Maturity Date (or if any such date is not a Business Day, the next
succeeding Business Day).
"Payment Default" with respect to any Portfolio Company, means (i) the Portfolio Company does not
fully comply with its obligation to pay Fixed Interest Payments or Interest Payments (as the case may
be) on two consecutive due dates or (ii) the total amount of overdue Fixed Interest Payments or Interest
Payments payable by a Portfolio Company is equal to or exceeds the amount payable as Fixed Interest
Payments or Interest Payments on accrual of two quarters.
"Permanent Global Note" has the meaning specified in Condition 2(2) (Form).
"Permitted Investments" means:
(a)
commercial paper or any other euro denominated securities that are an obligation of a
company, financial institution or a trust company which at the time of such purchase has (i) a
long term unsecured, unguaranteed and unsubordinated rating of at least "Aaa" by Moody's
and at least "AAA" by Fitch and (ii) a short term unsecured, unguaranteed and unsubordinated
rating of at least "P-1" by Moody's and at least "F1" by Fitch;
(b)
any bank account, deposit (including, for the avoidance of doubt, time deposits) or other debt
instruments issued by, or fully and unconditionally guaranteed on an unsecured and
unsurbordinated basis by, or, if a bank account or deposit, held or made with any financial
institution, the short term unsecured and unsubordinated debt obligations of which are rated at
55
least "P-1" by Moody's and at least "F1" by Fitch and the long term unsecured and
unsubordinated debt obligations of which are rated at least "A1" by Moody's; or
(c)
money market funds which are rated at least "MR1+" by Moody's and which have a long term
rating of "Aaa" by Moody's and permit daily liquidation of investments;
and in each case with a stated maturity of not less than two Business Days prior to the next following
Payment Date and where payments thereunder can be paid free of any deduction or withholding of tax
or whose terms and conditions provide for any payments to be grossed up in full in respect of any such
deductions or withholdings.
"Portfolio Companies" means the Private Portfolio Companies and the Public Portfolio Companies.
"Principal Custody Account" means a segregated sub-account in the name of the Issuer established by
the Custodian (including any cash account associated with such segregated sub-account) into which
Permitted Investments acquired by the Cash Administrator from sums standing to the credit of the
Issuer Account will be credited.
"Principal Deficiency" means the amount of the Advance under a Financing Agreement in respect of
which a Principal Deficiency Event has occurred plus, if a Financing Agreement has been terminated
prior to the Scheduled Redemption Date, any Make-Whole Amount payable to the Issuer in connection
with such terminated Financing Agreement.
"Principal Deficiency Event" means (i) the liquidation of a Portfolio Company, (ii) the institution of
insolvency proceedings against a Portfolio Company or the dismissal of a petition to open such
proceedings against a Portfolio Company on the grounds that such Portfolio Company has insufficient
assets (pursuant to Section 26 of the German Insolvency Code), (iii) a Payment Default under a
Financing Agreement, (iv) the sale of the Issuer's rights and interests in a Financing Agreement and (v)
the termination of a Financing Agreement prior to the Scheduled Redemption Date; provided, however,
that no such event shall be a Principal Deficiency Event to the extent it occurs in connection with a
Financing Agreement as to which a Principal Deficiency has previously been recorded in the Principal
Deficiency Ledger.
"Principal Deficiency Ledger" has the meaning specified in Condition 7(5) (Principal Deficiency
Ledger).
"Principal Deficiency Ledger Repayment" has the meaning specified in Condition 8(1) (Senior Note
Partial Early Redemption).
"Principal Paying Agent" has the meaning specified in Condition 17(1) (Principal Paying Agent).
"Priority of Payments" means the order of priority of payment noted in the Trust Deed and set out in
Condition 10 (Priority of Payments).
"Private Portfolio Company" has the meaning specified in Condition 4(1) (Proceeds of the
Compartment 2 Notes).
"Private Portfolio Company Advance" has the meaning specified in Condition 4(2)(a) (Private
Portfolio Company Advances).
"Private Portfolio Company Advance Repayment Claims" means the Issuer's claims for payment of
the Private Portfolio Company Advances.
"Profit Participation Agreements" has the meaning specified in Condition 4(1) (Proceeds of the
Compartment 2 Notes).
"Profit Participation End Date" has the meaning specified in Condition 4(2)(d) (Private Portfolio
Company Advance Repayment Date).
"Profit Participation Commencement Date" has the meaning specified in Condition 4(2)(b) (Fixed
Interest Payments).
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"Public Portfolio Company" has the meaning specified in Condition 4(1) (Proceeds of the
Compartment 2 Notes).
"Public Portfolio Company Advance" has the meaning specified in Condition 4(3)(a) (Public
Portfolio Company Advances).
"Public Portfolio Company Advance Repayment Claims" means the Issuer's claims for payment of
the Public Portfolio Company Advances.
"Rating Agencies" means Moody's and Fitch.
"Rating Requirement" means, or with respect to each of the Account Bank, the Custodian and the
Principal Paying Agent, a short term unsecured, unguaranteed and unsubordinated rating of at least
"P-1" by Moody's and of at least F1 by Fitch.
"Receipts" has the meaning specified in Condition 2(4) (Definitive Notes).
"Recoveries" means the proceeds realised on the sale of the rights and obligations of the Issuer under
the Financing Agreements to a third party or to the shareholders of the respective Portfolio Company,
in accordance with the terms and conditions of the respective Financing Agreement.
"Recovery Management Agreement" means the recovery management agreement between the Issuer,
the Recovery Manager and the Trustee dated the Issue Date.
"Recovery Manager" means mbb Consult GmbH, which term shall include any successor or substitute
recovery manager appointed under the Recovery Management Agreement.
"Recovery Manager Recoveries Fee" means the fee payable by the Issuer to the Recovery Manager
under the Recovery Management Agreement upon the realisation of Recoveries by the Recovery
Manager.
"Relevant Date" means whichever is the later of (a) the date on which any payment in respect of the
Compartment 2 Notes first becomes due and (b) if the full amount payable has not been received by the
Principal Paying Agent or the Trustee on or prior to such due date, the date on which the full amount
having been so received, notice to that effect shall have been given to the Compartment 2 Noteholders
in accordance with Condition 19 (Notices).
"Scheduled Redemption Date" means 13 April 2013.
"Secured Parties" means the Compartment 2 Noteholders, the Trustee, the Agents, the Swap
Counterparty, the Recovery Manager, the Transaction Adviser, the Lender, and the Initial Purchasers.
"Senior Notes" means, collectively, the Class A Notes and the Class B Notes.
"Senior Placement Fee" means the amount of €600,000 payable by the Issuer to Trinkaus on each
Payment Date pursuant to the Subscription Agreement;
"Senior Transaction Adviser Fee" means the fees and expenses of the Transaction Adviser payable
by the Issuer to the Transaction Adviser pursuant to the Investment Advisory Agreement
"Subordinated Loan Agreements" has the meaning specified in Condition 4(1) (Proceeds of the
Compartment 2 Notes).
"Subordinated Loan End Date" has the meaning specified in Condition 4(3)(d) (Public Portfolio
Company Advance Repayment Date).
"Subordinated Loan Start Date" has the meaning specified in Condition 4(3)(b) (Interest Payments).
"Subordinated Placement Fee" means, on any given Payment Date, the amount calculated in
accordance with the following formula (save that where the application of such formula results in a
negative number, the Subordinated Placement Fee shall be zero):
I = (R – IC) x F
57
where:
"I" means the relevant Subordinated Placement Fee;
"R" means the surplus (if any) remaining on such Payment Date after the payments referred to in
paragraphs (a) to (t) (inclusive) of the Priority of Payments have been made (or, if there is no such
surplus, "R" shall be zero);
"IC" means the surplus (if any) that was remaining on the immediately preceding Payment Date (if
there is one) after the payments referred to in paragraphs (a) to (u) of the Priority of Payments have
been made less the amount of the Subordinated Placement Fee (if any) paid on such Payment Date
(save that if either (i) such calculation results in a negative number or (ii) "IC" falls to be calculated on
or after the Scheduled Redemption Date, then "IC" shall be zero); and
"F" means 0.75 (in respect of each Payment Date falling prior to the Scheduled Redemption Date) or
1.00 (in respect of each Payment Date falling on or after the Scheduled Redemption Date).
"Subscription Agreement" means a subscription agreement dated 11 April 2006 between the Issuer
and the Initial Purchasers pursuant to which the Initial Purchasers subscribe for the Compartment 2
Notes.
"Swap Agreement" means, together, the Class A Swap and the Class B Swap.
"Swap Claims" means each claim of the Issuer against the Swap Counterparty under the Swap
Agreement.
"Swap Counterparty" means HSBC Bank plc, which term shall include any successor or substitute
swap counterparty.
"Swap Settlement Payments" means any net settlement amount and costs payable to the Swap
Counterparty under the Swap Agreement or any termination payment (other than any termination
payment due to the Swap Counterparty under the Swap Agreement because of an event of default
relating to the Swap Counterparty or because the Swap Counterparty is the sole Affected Party (as
defined in the Swap Agreement)).
"Temporary Global Note" has the meaning specified in Condition 2(2) (Form).
"Terms and Conditions" means these terms and conditions of the Compartment 2 Notes.
"Three Month Period" has the meaning specified in Condition 4(2)(b) (Fixed Interest Payments).
"Transaction Adviser" means HSBC Trinkaus & Burkhardt KGaA, which term shall include any
successor or substitute transaction adviser under the Investment Advisory Agreement.
"Transaction Documents" means, collectively, the Paying Agency Agreement, the Cash
Administration Agreement, the Swap Agreement, the Investment Advisory Agreement, the Recovery
Management Agreement, the Subscription Agreement, the Asset Sale and Transfer Agreement, the
Luxembourg Pledge Agreements, the Loan Agreement and the Trust Deed.
"Trinkaus" means HSBC Trinkaus & Burkhardt KGaA.
"Trust Deed" means the trust deed to be entered into between, inter alios, the Issuer and the Trustee on
the Issue Date.
"Trustee" means BNP Paribas Trust Corporation UK Limited as trustee under the Trust Deed.
"Trustee Fees and Expenses" means the fees and expenses of the Trustee payable by the Issuer to the
Trustee pursuant to the Trust Deed.
"United States Person" has the meaning specified in the United States Internal Revenue Code of 1986,
as amended.
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"Wind-up Costs" means, collectively, (i) the Issuer's operating expenses arising from the day
immediately following the Scheduled Redemption Date to the Legal Maturity Date and (ii) the Issuer's
obligations, if any, to pay the fees, costs and expenses of the Trustee, the Transaction Adviser, the
Agents, the Recovery Manager and the Cash Administrator.
"Withholding Tax Refunds" means any sums received by the Issuer from the German tax authorities
on account of a refund of German tax originally paid by a Portfolio Company in respect of payments
made by such Portfolio Company under the Financing Agreements.
2.
Denomination; Form and Custody, Transferability
(1)
Denomination: H.E.A.T Mezzanine S.A. (the "Issuer") will issue the €218,400,000 Class A
Compartment 2 Floating Rate Notes (the "Class A Notes"), the €30,800,000 Class B
Compartment 2 Floating Rate Notes (the "Class B Notes" and the Class B Notes together with
the Class A Notes, the "Senior Notes") and the €30,800,000 Junior Compartment 2 Notes (the
"Junior Notes" and, together with the Senior Notes, the "Compartment 2 Notes"). The Class
A Notes rank pari passu among themselves. The Class B Notes rank pari passu among
themselves. The Junior Notes rank pari passu among themselves. The Senior Notes will be in
the denomination of €50,000 each and the Junior Notes will be in the denomination of
€50,000 each.
(2)
Form: The Class A Notes, the Class B Notes and the Junior Notes will each initially be
represented by a temporary global note (each, a "Temporary Global Note") in bearer form
without interest coupons ("Coupons") which will be exchangeable (in whole or in part) not
earlier than 40 days after the Issue Date for a permanent global note in bearer form without
Coupons (each, a "Permanent Global Note", and the Temporary Global Notes together with
the Permanent Global Notes, the "Global Notes" and each, a "Global Note") upon
certification as to non-U.S. beneficial ownership of the Senior Notes and the Junior Notes, as
the case may be, the contents and form of which shall correspond to the applicable
requirements of the laws of the United States and the then prevailing standard practices of the
Clearing System.
(3)
U.S. Tax Matters: In compliance with U.S. tax laws and regulations, bearer securities may
not be offered, sold or delivered within the United States or its possessions or to a United
States Person, except in certain transactions permitted by U.S. tax regulations.
(4)
(a)
Confirmation of Ownership: No Compartment 2 Notes (except for the Temporary
Global Notes) may be delivered, and no principal or interest may be paid on any
Compartment 2 Note until the person entitled to receive such Compartment 2 Notes
or such principal or interest furnishes the written certification of non-U.S. beneficial
ownership described above.
(b)
Legend: The following legend will appear on the Global Notes, Compartment 2
Notes and Coupons, if any, appertaining thereto: "Any United States person (as
defined in the Internal Revenue Code of the United States) who holds this obligation
will be subject to limitations under the United States income tax laws, including the
limitations provided in Sections 165(j) and 1287(a) of the Internal Revenue Code of
the United States." The sections referred to in such legend provide that, with certain
exceptions, a United States Person will not be permitted to deduct any loss, and will
not be eligible for capital gain treatment with respect to any gain, realised on the sale
or redemption of such Compartment 2 Note or Coupon.
Definitive Notes: If either of Clearstream, Luxembourg or Euroclear should be closed for
business for a continuous period of 14 days (other than by reason of holidays, statutory or
otherwise) or should announce an intention permanently to cease business or does in fact do
so, interests in each Permanent Global Note will be exchangeable for Compartment 2 Notes in
definitive bearer form ("Definitive Notes"), which will have Coupons attached together with
receipts for the payment of principal ("Receipts"). Other than as provided for in the
immediately preceding sentences, the Compartment 2 Noteholders shall have no right to
require the issue of Definitive Notes representing individual Compartment 2 Notes and
Coupons.
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(5)
Issuance and Custody: Each of the Temporary Global Notes and the Permanent Global Notes
shall only be valid if it bears the hand-written signatures of at least one duly authorised
representative of the Issuer and the authentication signature(s) of the Principal Paying Agent.
The Global Notes shall be deposited with the Clearing System until the Issuer has satisfied
and discharged all its obligations under the Compartment 2 Notes.
(6)
Title: Title to the Compartment 2 Notes, the Coupons and the Receipts passes upon delivery.
The holder of a Compartment 2 Note, Coupon or Receipt will (except as required by law) be
treated as its absolute owner for all purposes (whether or not it is overdue and regardless of
any notice of ownership, trust or any interest in it, any writing on it, or its theft or loss) and no
person will be liable for so treating the holder.
(7)
Trust Deed and other Agreements: These Conditions include summaries of, and are subject
to, the detailed provisions of the Trust Deed (which includes the forms of the Compartment 2
Notes). The following agreements have been entered into in relation to the Compartment 2
Notes: (a) the Paying Agency Agreement, (b) the Cash Administration Agreement, (c) the
Asset Sale and Transfer Agreement, (d) the Investment Advisory Agreement, (e) the Recovery
Management Agreement, (f) the Swap Agreement, (g) the Loan Agreement and (h) the
Luxembourg Pledge Agreements. Copies of the Trust Deed, the Paying Agency Agreement,
the Cash Administration Agreement, the Investment Advisory Agreement, the Recovery
Management Agreement, the Asset Sale and Transfer Agreement, the Swap Agreement, the
Loan Agreement and the Luxembourg Pledge Agreements are available for inspection during
usual business hours at the specified offices of the Paying Agents for the time being. The
holders of each Class of Compartment 2 Notes are entitled to the benefit of, are bound by and
are deemed to have notice of all the provisions of the Trust Deed, and are deemed to have
notice of all of the provisions of the Paying Agency Agreement and the Cash Administration
Agreement applicable to them.
3.
Status of the Compartment 2 Notes; Security
(1)
Class A Notes: The Class A Notes and related Coupons and Receipts constitute direct,
unsubordinated, secured, conditional and limited recourse obligations of the Issuer ranking in
priority to the Class B Notes and the Junior Notes but ranking pari passu and rateably without
any preference among themselves.
(2)
Class B Notes: The Class B Notes and related Coupons and Receipts constitute direct,
subordinated, secured, conditional and limited recourse obligations of the Issuer ranking in
priority to the Junior Notes but ranking pari passu and rateably without any preference among
themselves and ranking junior to the Class A Notes.
(3)
Junior Notes: The Junior Notes and related Coupons and Receipts constitute direct,
subordinated, secured, conditional and limited recourse obligations of the Issuer ranking pari
passu and rateably without any preference among themselves.
(4)
Security: Pursuant to, and subject to the terms and conditions of, the Trust Deed, the Issuer
has in favour of the Secured Parties:
(i)
assigned by way of security all right, title and interest of the Issuer in respect of the
Profit Participation Agreements, the Subordinated Loan Agreements, the Loan
Agreement and the Permitted Investments from time to time (where such rights are
contractual rights) including, without limitation, all moneys received in respect thereof,
all dividends and distributions paid or payable thereon, all property paid, distributed,
accruing or offered at any time on, to or in respect of or in substitution therefor and the
proceeds of sale, repayment and redemption thereof,
(ii)
for the purposes of German law and to the maximum extent permitted under the terms
of the Profit Participation Agreements and the Subordinated Loan Agreements, has
assigned by way of security all right, title and interest of the Issuer in respect to the
Profit Participation Agreements and the Subordinated Loan Agreements, including,
without limitation, all moneys received in respect thereof, all dividends and
distributions paid or payable thereon, all property paid, distributed, accruing or offered
60
at any time on, to or in respect of or in substitution therefor and the proceeds of sale,
repayment and redemption thereof,
(iii)
charged by way of a first fixed charge and first priority security interest all right, title
and interest of the Issuer in respect of all Permitted Investments from time to time
(where such rights are securities) including, without limitation, all moneys received in
respect thereof, all dividends and distributions paid or payable thereon, all property
paid, distributed, accruing or offered at any time on, to or in respect of or in
substitution therefor and the proceeds of sale, repayment and redemption thereof,
(iv)
charged by way of a first fixed charge and first priority security interest all right, title
and interest of the Issuer in respect of the Accounts and all moneys from time to time
standing to the credit of the Accounts and including, without limitation, all interest
accrued and other moneys received in respect thereof,
(v)
charged by way of first fixed charge and first priority security interest all right, title and
interest of the Issuer in respect of the Custody Accounts (including each cash account
relating to the Custody Accounts, any cash held therein and the debt represented
thereby),
(vi)
charged by way of a first fixed charge and first priority security interest all moneys
held from time to time by the Paying Agents for the payment of principal, interest or
other amounts under the Compartment 2 Notes (if any),
(vii)
assigned by way of security all of the Issuer's right, title and interest, present and
future, under the Cash Administration Agreement,
(viii) assigned by way of security all of the Issuer's right, title and interest, present and
future, under the Asset Sale and Transfer Agreement,
(ix)
assigned by way of security all of the Issuer's right, title and interest, present and
future, under the Recovery Management Agreement,
(x)
assigned by way of security all of the Issuer's right, title and interest, present and
future, under the Paying Agency Agreement,
(xi)
assigned by way of security all of the Issuer's right, title and interest, present and
future, under the Investment Advisory Agreement,
(xii)
assigned by way of security all of the Issuer's right, title and interest, present and
future, under the Swap Agreement (including the Issuer's rights under any guarantee or
credit support annex entered into pursuant to the Swap Agreement provided that such
assignment by way of security shall not in any way restrict the release of Compartment
2 Collateral granted thereunder in whole or in part at any time pursuant to the terms
thereof),
(xiii) charged by way of a floating charge all of the Compartment 2 undertaking and assets to
the extent that such undertaking and assets are not subject to any other security referred
to in paragraphs (i) to (xii) above.
Pursuant to the Luxembourg Pledge Agreements, the Issuer has in favour of the Trustee for the
benefit of the Secured Parties pledged all rights title and interest of the Issuer in respect of the
Permitted Investments, the Custody Accounts and the Accounts.
4.
Profit Participation Agreements and Subordinated Loan Agreements
(1)
Proceeds of the Compartment 2 Notes: The Issuer will use the net proceeds from the issue
of the Compartment 2 Notes on the Issue Date (i) to pay to each of certain small and mediumsized private companies located in the Federal Republic of Germany and organised under
German law (each a "Private Portfolio Company") a cash advance funded by part of the net
proceeds of the issue of the Compartment 2 Notes under profit participation agreements
between the Issuer and each Private Portfolio Company ("Profit Participation Agreements")
61
and (ii) to pay to each of certain small and medium sized companies located in the Federal
Republic of Germany and organised under German law (each a "Public Portfolio Company")
a cash advance funded by part of the net proceeds of the issue of the Compartment 2 Notes,
under subordinated loan agreements between the Issuer and each Public Portfolio Company
("Subordinated Loan Agreements").
(2)
Profit Participation Agreements:
(a)
Private Portfolio Advances: The Issuer will make to each Private Portfolio
Company on the Issue Date, a cash advance under each Profit Participation
Agreement (each such cash advance, a "Private Portfolio Company Advance") in
individual amounts per Private Portfolio Company of not less than €2,000,000 and
not greater than €12,500,000. The Issuer will make each Private Portfolio Company
Advance after the sale and transfer to it of the Profit Participation Agreement relating
thereto pursuant to the terms of the Asset Sale and Transfer Agreement. In return for
making the Private Portfolio Company Advance, the Issuer will earn from such
Private Portfolio Company fixed interest payments ("Fixed Interest Payments") as a
percentage per annum of the amount of each Private Portfolio Company Advance and
payable quarterly in arrear.
(b)
Fixed Interest Payments: Under each Profit Participation Agreement, Fixed Interest
Payments accrue for each consecutive three month period (each, a "Three Month
Period") during the period from and including the date on which the offer to enter
into such Profit Participation Agreement set out therein is accepted (each, a "Profit
Participation Commencement Date") (on which date the first Three Month Period
begins) to but excluding the Profit Participation End Date (as defined below) (on
which date the last Three Month Period ends), at a percentage rate per annum on the
amount of the Private Portfolio Company Advance as determined under the
respective Profit Participation Agreements. Fixed Interest Payments remain due and
payable if the unconsolidated annual financial statements of the Private Portfolio
Company or the consolidated annual financial statements of the group of which the
Private Portfolio Company forms part show no annual surplus or consolidated annual
surplus.
(c)
Due Dates for Fixed Interest Payments: Fixed Interest Payments will be due and
payable under the Profit Participation Agreements to the Issuer on 20 March,
20 June, 20 September and 20 December of each calendar year. If the Fixed Interest
Payment is to be calculated for a period of less than three months, it will be
calculated on the basis of the actual number of days elapsed in the respective period,
divided by 365 (or, in the case of a leap year, 366).
(d)
Private Portfolio Company Advance Repayment Date: The term of a Profit
Participation Agreement begins on the Profit Participation Commencement Date and
ends upon the anniversary of the Profit Participation Commencement Date falling in
2013 ("Profit Participation End Date"). The Private Portfolio Company Advance
becomes due and payable by each Private Portfolio Company on the Profit
Participation End Date in accordance with the terms and conditions stated in the
applicable Profit Participation Agreement.
(e)
Early Termination: Either party may terminate a Profit Participation Agreement
without advance notice for extraordinary circumstances (aus wichtigem Grund). For
the Issuer, such extraordinary circumstances include, among others, (i) the
liquidation of the Private Portfolio Company, (ii) the institution of insolvency
proceedings against the Private Portfolio Company or the dismissal of a petition to
open such proceedings against a Private Portfolio Company on the grounds that such
Private Portfolio Company has insufficient assets (pursuant to Section 26 of the
German Insolvency Code), (iii) the failure of the Private Portfolio Company to
prepare audited financial statements within the time period prescribed by law, (iv) a
Change of Control (as defined in the Profit Participation Agreements) or other action
outside the normal course of the Portfolio Company's business if the Issuer's legal
status or economic interests are thereby materially impaired, (v) a breach of the
62
Private Portfolio Company's informational obligations under the Profit Participation
Agreement and (vi) distributions to shareholders during such time as any Fixed
Interest Payments or repayment of Private Portfolio Company Advances have not
been paid in full. The Issuer's termination notice shall not be effective until it has
satisfied certain requirements as specified in the Profit Participation Agreement.
(3)
Subordinated Loan Agreements:
(a)
Public Portfolio Company Advances: The Issuer will make, on the Issue Date, a
cash advance to each Public Portfolio Company under each Subordinated Loan
Agreement (each such loan, a "Public Portfolio Company Advance") in individual
amounts per Public Portfolio Company of not less than €2,000,000 and not greater
than €12,500,000. The Issuer will make each Public Portfolio Company Advance
after the sale and transfer to it of the Subordinated Loan Agreement relating thereto
pursuant to the terms of the Asset Sale and Transfer Agreement. In return for making
the Public Portfolio Company Advance, the Issuer will earn from such Public
Portfolio Company quarterly interest payments ("Interest Payments") as a
percentage per annum of the amount of each Public Portfolio Company Advance and
payable quarterly in arrear.
(b)
Interest Payments: Under each Subordinated Loan Agreement, Interest Payments
accrue for each Three Month Period during the period from and including the date on
which the offer to enter into such Subordinated Loan Agreement set out therein is
accepted (each, a "Subordinated Loan Start Date") (on which date the first Three
Month Period begins) to but excluding the Subordinated Loan End Date (as defined
below) (on which date the last Three Month Period ends) at a percentage rate per
annum on the amount of the Public Portfolio Company Advance as provided by each
individual Subordinated Loan Agreement.
(c)
Due Dates on Interest Payments: Interest Payments will be due and payable under
the Subordinated Loan Agreements to the Issuer on 20 March, 20 June, 20 September
and 20 December of each calendar year. If the Interest Payment is to be calculated for
a period of less than three months, it will be calculated on the basis of the actual
number of days elapsed in the respective period, divided by 365 (or, in the case of a
leap year, 366).
(d)
Public Portfolio Company Advance Repayment Date: The term of a Subordinated
Loan Agreement begins upon the payment by the Issuer of the respective Public
Portfolio Company Advance on the Subordinated Loan Start Date and ends upon the
anniversary of the Subordinated Loan Start Date falling in 2013 ("Subordinated
Loan End Date"). The Public Portfolio Company Advance becomes due and
payable by each Public Portfolio Company on the third Business Day prior to the
Subordinated Loan End Date in accordance with the terms and conditions stated in
the applicable Subordinated Loan Agreement.
(e)
Early Termination: Either party may terminate a Subordinated Loan Agreement
without advance notice for extraordinary circumstances (aus wichtigem Grund). For
the Issuer, such extraordinary circumstances include (i) the liquidation of the Public
Portfolio Company, (ii) the institution of insolvency proceedings against the Public
Portfolio Company or the dismissal of a petition to open such proceedings against a
Public Portfolio Company due to insufficient assets, (iii) the failure of the Public
Portfolio Company to prepare audited financial statements within the time period
prescribed by law, (iv) a Change of Control (as defined in the Subordinated Loan
Agreements) or other action outside the normal course of the Public Portfolio
Company's business if the Issuer's legal status or economic interests are thereby
materially impaired, (v) a breach of the Public Portfolio Company's informational
obligations under the Subordinated Loan Agreement and (vi) distributions to
shareholders during such time as any Interest Payments or repayment of Public
Portfolio Company Advances has not been paid in full. The Issuer's termination
notice shall not be effective until it has satisfied certain requirements as specified in
the Subordinated Loan Agreement.
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(f)
Conversion: Public Portfolio Companies have the right, but not the obligation,
within three months of the relevant Subordinated Loan Start Date, to alter the terms
and conditions of the Subordinated Loan Agreement to those of a Profit Participation
Agreement (a "Conversion"), provided that they have obtained the prior required
corporate authorisations. From the date that each Conversion is effective, each such
Subordinated Loan Agreement shall be referred to as a Profit Participation
Agreement herein.
5.
Issuer Commitment; Legal Relationships
(1)
Issuer Commitment: The Compartment 2 Notes represent the Issuer's obligation to use the
net proceeds from the issue of the Compartment 2 Notes for the purpose of paying the
Advances and to use the Issuer Receipts to satisfy its payment obligations towards the
Compartment 2 Noteholders in accordance with the provisions of these Terms and Conditions.
The Issuer shall have no assets available for payments to the Compartment 2 Noteholders
other than Available Distribution Funds actually received and available for use by the Issuer
prior to the applicable Payment Date. Claims in respect of any shortfall on a Payment Date
will be payable on each following Payment Date, subject to the Priority of Payments, until
paid in full and failure by the Issuer to make payment in respect of any such shortfall will not
constitute a default by the Issuer for any purpose. Any Coupon Payments to the Compartment
2 Noteholders so deferred will not earn interest. Claims in respect of any shortfall on the Legal
Maturity Date shall be extinguished and failure by the Issuer to make payment in respect of
any such shortfall will not constitute a default by the Issuer for any purpose.
(2)
No Relationship between Compartment 2 Noteholders and the Private Portfolio
Companies: The Profit Participation Agreements do not create any rights of the Compartment
2 Noteholders in relation to the Private Portfolio Companies.
(3)
No Relationship between Compartment 2 Noteholders and the Public Portfolio
Companies: The Subordinated Loan Agreements do not create any rights of the Compartment
2 Noteholders in relation to the Public Portfolio Companies.
6.
Coupon Payments
(1)
Class A Coupon Payments: The Issuer shall pay, for the period from (and including) the
Issue Date to (but excluding) the Legal Maturity Date, to the holders of the Class A Notes
floating interest payments (the "Class A Coupon Payments") calculated at six-month
EURIBOR plus a margin of 0.33 per cent. per annum of the principal amount per Class A
Note outstanding from time to time immediately prior to the relevant Payment Date. Class A
Coupon Payments will be payable semi-annually in arrear on each Payment Date. Class A
Coupon Payments shall be calculated on the basis of the actual number of days elapsed in the
respective period, divided by 360.
Class A Coupon Payments, if any, will be paid in accordance with the Priority of Payments. A
pro rata share of the above amounts payable (rounded down to the next full cent) shall be
allocated to each Class A Note. The Issuer shall have no assets available for payment of a
Class A Coupon Payment other than Available Distribution Funds actually received and
available for use by the Issuer prior to the applicable Payment Date. Claims in respect of any
shortfall on a Payment Date (including, for the avoidance of doubt, any shortfall arising from
the non-payment of some or all of any Class A Coupon Payment in respect of a prior Payment
Date) will be deferred and be payable on the next following Payment Date, subject to the
Priority of Payments, until paid in full and failure by the Issuer to make payment in respect of
any such shortfall will not constitute a default by the Issuer for any purpose. Any Class A
Coupon Payments so deferred will not earn interest. Claims in respect of any shortfall on the
Legal Maturity Date shall be extinguished and failure by the Issuer to make payment in
respect of any such shortfall will not constitute a default by the Issuer for any purpose.
(2)
Class B Coupon Payments: The Issuer shall pay, for the period from (and including) the
Issue Date to (but excluding) the Legal Maturity Date, to the holders of the Class B Notes
floating interest payments (the "Class B Coupon Payments"; and, together with the Class A
Coupon Payments, the "Floating Senior Coupon Payments") calculated at EURIBOR plus a
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margin of 0.83 per cent. per annum of the principal amount per Class B Note outstanding from
time to time immediately prior to the relevant Payment Date. Class B Coupon Payments will
be payable semi-annually in arrear on each Payment Date. Class B Coupon Payments shall be
calculated on the basis of the actual number of days elapsed in the respective period, divided
by 360.
Class B Coupon Payments, if any, will be paid in accordance with the Priority of Payments. A
pro rata share of the above amounts payable (rounded down to the next full cent) shall be
allocated to each Class B Note. The Issuer shall have no assets available for payment of a
Class B Coupon Payment other than Available Distribution Funds actually received and
available for use by the Issuer prior to the applicable Payment Date. Claims in respect of any
shortfall on a Payment Date (including, for the avoidance of doubt, any shortfall arising from
the non-payment of some or all of any Class B Coupon Payment in respect of a prior Payment
Date) will be deferred and be payable on the next following Payment Date, subject to the
Priority of Payments, until paid in full and failure by the Issuer to make payment in respect of
any such shortfall will not constitute a default by the Issuer for any purpose. Any Class B
Coupon Payments so deferred will not earn interest. Claims in respect of any shortfall on the
Legal Maturity Date shall be extinguished and failure by the Issuer to make payment in
respect of any such shortfall will not constitute a default by the Issuer for any purpose.
(3)
Junior Coupon Payments: Interest payments ("Junior Coupon Payments", and the Junior
Coupon Payments and the Floating Senior Coupon Payments, collectively, the "Coupon
Payments") to the holders of the Junior Notes will accrue on each Junior Note on a pro rata
basis at the percentage rate per annum of the Junior Notional Amount applicable to the
relevant Accrual Period as set out in Schedule C (the "Junior Coupon Rate Schedule")
attached to these terms and conditions. Junior Coupon Payments shall accrue on the Junior
Notes from (and including) the Issue Date until (but excluding) the Legal Maturity Date, and
will be payable semi-annually in arrear on each Payment Date, subject to the Priority of
Payments. Junior Coupon Payments shall be calculated on the basis of the Actual/Actual
ISMA Day Count Fraction.
Junior Coupon Payments, if any, will be paid in accordance with the Priority of Payments. A
pro rata share of the above amounts payable (rounded down to the next full cent) shall be
allocated to each Junior Note. The Issuer shall have no assets available on any Payment Date
for payment of a Junior Coupon Payment other than Available Distribution Funds actually
received and available for use by the Issuer prior to the applicable Payment Date. Claims in
respect of any shortfall on a Payment Date (including, for the avoidance of doubt, any
shortfall arising from the non-payment of some or all of any Junior Coupon Payment in
respect of a prior Payment Date) will be deferred and be payable on the next following
Payment Date, subject to funds being available in accordance with the Priority of Payments,
until paid in full and failure by the Issuer to make payment in respect of any such shortfall will
not constitute a default by the Issuer for any purpose. Any Junior Coupon Payments so
deferred will not earn interest. Claims in respect of any shortfall on the Legal Maturity Date
shall be extinguished and failure by the Issuer to make payment in respect of any such
shortfall will not constitute a default by the Issuer for any purpose.
7.
Redemption
(1)
Amortisation of the Class A Notes: On each Payment Date during the period from (and
including) the Issue Date to (but excluding) the Scheduled Redemption Date, (or, if earlier,
until the Class A Notes have been redeemed in full), the Issuer shall pay, in redemption of the
Outstanding Principal Amount of the Class A Notes, the amount (the "Class A Amortisation
Amount") corresponding to such date as specified in the Class A Amortisation Schedule. The
Issuer shall have no assets available for payment of the Class A Amortisation Amount other
than Available Distribution Funds actually received and available for use by the Issuer prior to
the applicable Payment Date. Claims in respect of any shortfall on a Payment Date will be
payable on each following Payment Date, subject to the Priority of Payments, until paid in full
and failure by the Issuer to make payment in respect of any such shortfall will not constitute a
default by the Issuer for any purpose. Any payments of the Class A Amortisation Amount so
deferred will not earn interest. Claims in respect of any shortfall on the Legal Maturity Date
65
shall be extinguished and failure by the Issuer to make payment in respect of any such
shortfall will not constitute a default by the Issuer for any purpose.
(2)
Redemption of the Class A Notes on the Scheduled Redemption Date: The Class A Notes
will become due for repayment on the Scheduled Redemption Date and will be redeemed on
the Scheduled Redemption Date out of Available Distribution Funds available on that date at
their Outstanding Principal Amount.
The Issuer shall have no assets available for payment of the redemption amount in respect of
the Class A Notes other than Available Distribution Funds actually received and available for
use by the Issuer prior to the applicable Payment Date. Claims in respect of any shortfall on a
Payment Date (including, for the avoidance of doubt, any shortfall arising from the nonpayment of some or all of any redemption amount in respect of any prior Payment Date) on
the redemption amount in respect of the Class A Notes will be deferred and be payable on the
next Payment Date, subject to the Priority of Payments, until paid in full and failure by the
Issuer to make payment in respect of any such shortfall will not constitute a default by the
Issuer for any purpose. Claims in respect of any shortfall on the Legal Maturity Date shall be
extinguished and failure by the Issuer to make payment in respect of any such shortfall will
not constitute a default by the Issuer for any purpose. Such redemption payments, if any, will
be paid in the order of, and subject to, the Priority of Payments.
(3)
Redemption of the Class B Notes on the Scheduled Redemption Date: The Class B Notes
will become due for repayment on the Scheduled Redemption Date and will be redeemed on
the Scheduled Redemption Date, out of Available Distribution Funds available on that date, at
their Outstanding Principal Amount.
The Issuer shall have no assets available for payment of the redemption amount in respect of
the Class B Notes other than Available Distribution Funds actually received and available for
use by the Issuer prior to the applicable Payment Date. Claims in respect of any shortfall on a
Payment Date (including, for the avoidance of doubt, any shortfall arising from the nonpayment of some or all of any redemption amount in respect of any prior Payment Date) on
the redemption amount in respect of the Class B Notes will be deferred and be payable on the
next Payment Date, subject to the Priority of Payments, until paid in full and failure by the
Issuer to make payment in respect of any such shortfall will not constitute a default by the
Issuer for any purpose. Claims in respect of any shortfall on the Legal Maturity Date shall be
extinguished and failure by the Issuer to make payment in respect of any such shortfall will
not constitute a default by the Issuer for any purpose. Such redemption payments, if any, will
be paid in the order of, and subject to, the Priority of Payments.
(4)
Redemption of the Junior Notes on the Scheduled Redemption Date: The Junior Notes
will become due for repayment on the Scheduled Redemption Date and will be redeemed at
their Outstanding Principal Amount in accordance with Schedule B. The Issuer shall have no
assets available for payment of the Junior Redemption Amount other than Available
Distribution Funds actually received and available for use by the Issuer prior to the applicable
Payment Date. Claims in respect of any shortfall on a Payment Date (including, for the
avoidance of doubt, any shortfall arising from the non-payment of some or all of any
redemption amount in respect of any prior Payment Date) on the Junior Redemption Amount
will be deferred and be payable on the next Payment Date, subject to the Priority of Payments,
until paid in full and failure by the Issuer to make payment in respect of any such shortfall will
not constitute a default by the Issuer for any purpose. Claims in respect of any shortfall on the
Legal Maturity Date shall be extinguished and failure by the Issuer to make payment in
respect of any such shortfall will not constitute a default by the Issuer for any purpose. Such
payments of the Junior Redemption Amount, if any, will be paid in the order of, and subject
to, the Priority of Payments.
(5)
Principal Deficiency Ledger: For the purposes of allocating Principal Deficiencies incurred
on the Financing Agreements, the Issuer will maintain or cause to be maintained a principal
deficiency ledger ("Principal Deficiency Ledger") in which shall be entered (i) as a debit the
amount of any Principal Deficiencies and (ii) as a credit the amount of any Principal
Deficiency Ledger Repayments (as defined below) in accordance with the terms and
conditions of the Trust Deed and as noted in Condition 10 (Priority of Payments).
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8.
Early Partial Redemption
(1)
The Class A Notes shall be redeemed, in part
(a)
on a pro rata principal amount basis with each other, on each Payment Date prior to
the Scheduled Redemption Date in an amount equal to the Class A Amortisation
Amount applicable to such Payment Date; and
(b)
on a pro rata principal amount basis with each other, on each Payment Date on
which the Principal Deficiency Ledger shows a debit balance, in an amount equal to
such amount as is necessary to reduce the debit balance in the Principal Deficiency
Ledger to zero (each such payment, to the extent of the Available Distribution Funds
available therefor on the applicable Payment Date in accordance with the Priority of
Payments, a "Principal Deficiency Ledger Repayment");
but only to the extent funds are available therefor in accordance with the order of the Priority
of Payments.
(2)
The Class B Notes will be redeemed, in part on a pro rata principal amount basis with each
other, on each Payment Date on which the Issuer makes a Principal Deficiency Ledger
Repayment, in an amount equal to the excess, if any, of (x) such Principal Deficiency over (y)
the amounts paid on such Payment Date to the holders of the Class A Notes on account of
such Principal Deficiency Ledger debit balance, but only to the extent funds are available
therefor in accordance with the order of the Priority of Payments.
(3)
The Junior Notes will be redeemed, in part on a pro rata principal amount basis with each
other, on each Payment Date on which the Issuer makes a Principal Deficiency Ledger
Repayment, in an amount equal to the excess, if any, of (x) such Principal Deficiency over (y)
the amounts paid on such Payment Date to the holders of the Class A Notes and the Class B
Notes on account of such Principal Deficiency Ledger debit balance, but only to the extent
funds are available therefor in accordance with the order of the Priority of Payments.
9.
Withholding, Early Termination and Repayment for Tax Reasons
If (i) as a result of any change in, or amendment to, the laws or regulations of Luxembourg or
any political subdivision or taxing authority thereto or therein affecting taxation or the
obligation to pay duties of any kind, or any change in, or amendment to, an official
interpretation or application of such laws or regulations, which amendment or change is
effective on or after the Issue Date or (ii) because the Issuer has been determined to have a
taxable presence in Germany (and the Issuer represents that it has not taken and agrees not to
take any action that reasonably could be expected to lead to such a determination), the Issuer
is required to withhold or deduct amounts payable on the Compartment 2 Notes on account of
tax, in either such event, the Compartment 2 Notes may be redeemed commencing on or after
the first anniversary of the Issue Date, in whole but not in part, at the option of the Issuer, with
effect on the next following Payment Date upon not more than 60 days' nor less than 30 days'
prior notice of redemption given to the Principal Paying Agent and, in accordance with
Condition 18 (Substitution) to the Compartment 2 Noteholders, at their Outstanding Principal
Amount, together with interest pursuant to Condition 6(1) (Class A Coupon Payments)
through 6(4) (Class B Coupon Payments) accrued on the Outstanding Principal Amount of the
Senior Notes or interest payments pursuant to Condition 6(5) (Junior Coupon Payments) on
the Junior Notional Amount, respectively, to the date fixed for redemption in accordance with
the order of the Priority of Payments. Any such notice shall be irrevocable, must specify the
date fixed for redemption and must set forth a statement in summary form of the facts
constituting the basis for the right of the Issuer so to redeem. In the event that the Issuer is
required to withhold or deduct amounts payable on the Compartment 2 Notes on account of
tax, the Issuer shall not be under any obligation to the Compartment 2 Noteholders to gross-up
any payments in respect of the Compartment 2 Notes as a result of such requirement to
withhold or deduct payments on account of tax.
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10.
Priority of Payments
(1)
Priority of Payments: Payments due under the Compartment 2 Notes will be paid to the
respective Compartment 2 Noteholders in the order of, and subject to, the Priority of
Payments. The Priority of Payments provides that certain operating expenses and liabilities of
the Issuer will rank senior to amounts owed by the Issuer to the Compartment 2 Noteholders
under the Compartment 2 Notes in respect of the Floating Senior Coupon Payments, the
Junior Coupon Payments and the Capital Payments and that such payments will be paid to the
respective Compartment 2 Noteholders in the order of the Priority of Payments.
(2)
Payment Date Priority of Payments: Subject to the terms and conditions of the Trust Deed,
on each Payment Date the Cash Administrator shall on behalf of the Issuer apply all Available
Distribution Funds as at that Payment Date in the following order of the Priority of Payments
but, in each case, only to the extent that there are funds available for that purpose and all
payments of a higher priority have been made in full:
(a)
first, in payment of all amounts then due and payable by the Issuer in respect of
Trustee Fees and Expenses;
(b)
second, in or towards repayment of any amounts due and payable to the Lender under
the Loan Agreement (whether by way of Loan Advance or otherwise but excluding
any expenses of the Lender incurred pursuant to the Loan Agreement);
(c)
third, in or towards payment pari passu with each other on a pro rata basis of all
amounts then due and payable by the Issuer in respect of Maintenance Expenses;
(d)
fourth, save for the Payment Date on which the Junior Notes have previously been
redeemed in full or fall due to be redeemed in full, in payment into the Expenses
Reserve Account of up to a credit balance of €75,000;
(e)
fifth, in or towards payment pari passu with each other on a pro rata basis of all
amounts then due and payable by the Issuer in respect of any Administrative
Expenses up to an amount equal to the Administrative Expenses Cap;
(f)
sixth, in or towards payment to the Swap Counterparty of any Swap Settlement
Payments due and payable under the Swap Agreement (other than any amounts
payable pursuant to paragraph (o) below);
(g)
seventh, on any Payment Date, to the Principal Paying Agent in or towards payment
on a pro rata basis pari passu with each other of Class A Coupon Payments then due
and payable by the Issuer on the Class A Notes (with the Outstanding Principal
Amount of the Class A Notes to be determined prior to the application of the
payments in (h), (k) and (l) below);
(h)
eighth, on any Payment Date on or following the Scheduled Redemption Date, to the
Principal Paying Agent in or towards payment to holders of the Class A Notes pari
passu with each other of the Outstanding Principal Amount of the Class A Notes on a
pro rata basis until all Class A Notes have been fully redeemed;
(i)
ninth, on any Payment Date, to the Principal Paying Agent in or towards payment on
a pro rata basis pari passu with each other of the Class B Coupon Payments then due
and payable by the Issuer on the Class B Notes (with the Outstanding Principal
Amount of the Class B Notes to be determined prior to the application of the
payments in (m) below);
(j)
tenth, on any Payment Date on or following the Scheduled Redemption Date, to the
Principal Paying Agent in or towards payment to holders of the Class B Notes pari
passu with each other of the Outstanding Principal Amount of the Class B Notes on a
pro rata basis until all Class B Notes have been fully redeemed;
(k)
eleventh, on each Payment Date prior to the Scheduled Redemption Date and to the
extent that any Class A Notes are then outstanding, to the Principal Paying Agent in
68
or towards payment to holders of the Class A Notes pari passu with each other on a
pro rata basis as scheduled partial redemption on the Class A Notes, of an amount
equal to the lesser of:
(l)
(m)
(x)
the Class A Amortisation Amount corresponding to such Payment Date, as
specified in the Class A Amortisation Schedule; and
(y)
the Outstanding Principal Amount of the Class A Notes;
twelfth, on any Payment Date on which the Principal Deficiency Ledger shows a
debit balance, to the Principal Paying Agent in or towards payment to holders of the
Class A Notes pari passu with each other on a pro rata basis as early redemption of
the Class A Notes of an amount equal to the lesser of:
(x)
such debit balance (expressed as a positive figure); and
(y)
the Outstanding Principal Amount of the Class A Notes;
thirteenth, on any Payment Date on or after which the Class A Notes have been fully
redeemed and on which the Principal Deficiency Ledger shows a debit balance, to the
Principal Paying Agent in or towards payment to holders of the Class B Notes pari
passu with each other on a pro rata basis as early redemption of the Class B Notes of
an amount equal to the lesser of:
(x)
such debit balance (expressed as a positive figure) (taking into account the
application of the payments in (l) above); and
(y)
the Outstanding Principal Amount of the Class B Notes;
(n)
fourteenth, in or towards payment to the parties to whom Administrative Expenses
are due under paragraph (e) above, pari passu with each other on a pro rata basis, of
that portion, if any, of the aggregate of such Administrative Expenses that is greater
than the Administrative Expenses Cap;
(o)
fifteenth, to any amounts then due and payable with respect to any termination
payment due to the Swap Counterparty under the Swap Agreement because of an
event of default relating to the Swap Counterparty (or because it is the sole Affected
Party (as defined in the Swap Agreement)), and any costs due to the Swap
Counterparty with respect thereto, to the Swap Counterparty;
(p)
sixteenth, on any Payment Date, to the Principal Paying Agent in or towards
payment to holders of the Junior Notes on a pro rata basis pari passu with each other
of the Junior Coupon Payments then due and payable by the Issuer on the Junior
Notes;
(q)
seventeenth, on any Payment Date on or following the Scheduled Redemption Date,
to the Principal Paying Agent in or towards payment to holders of the Junior Notes
pari passu with each other of the Outstanding Principal Amount of the Junior Notes
on a pro rata basis until all Junior Notes have been redeemed in full;
(r)
eighteenth, on any Payment Date on or after which the Senior Notes have been fully
redeemed and on which the Principal Deficiency Ledger shows a debit balance, to the
Principal Paying Agent in and towards payment to the holders of the Junior Notes
pari passu with each other on a pro rata basis as early redemption on the Junior
Notes of an amount equal to the lesser of:
(x)
such amount as is necessary after the application of the payments in (l) and
(m) above to reduce the debit balance in the Principal Deficiency Ledger to
zero; and
(y)
the Outstanding Principal Amount of the Junior Notes;
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(s)
nineteenth, in or towards payment of the Subordinated Placement Fee payable to
Trinkaus;
(t)
twentieth, in or towards payment of a dividend to the shareholders of the Issuer as a
distribution of profits for the fiscal year of the Issuer ending immediately prior to
such Payment Date and in accordance with the relevant meeting of the shareholders
of the Issuer;
(u)
twenty-first, any remaining amounts to the Issuer Account pending application on
the next succeeding Payment Date of the Available Distribution Funds in the manner
described in (a) to (t) above.
11.
The Accounts and the Custody Accounts
(1)
The Establishment of the Accounts and the Custody Accounts:
The Issuer shall, prior to the Issue Date, establish the following accounts with the Account
Bank or the Custodian (as applicable):
(2)
(3)
(a)
the Issuer Account;
(b)
the Principal Custody Account;
(c)
the Expenses Reserve Account; and
(d)
the Expenses Reserve Custody Account;
The Issuer Account
(a)
The Issuer (acting through the Cash Administrator) shall procure that the Issuer
Receipts are paid into the Issuer Account.
(b)
The Issuer (acting through the Cash Administrator) shall procure payment of the
following amounts out of the Issuer Account (and shall ensure that payment of no
other amount is made):
(i)
on each Payment Date, any payments required to be made pursuant to
Condition 10(2) (Payment Date Priority of Payments);
(ii)
at any time, any payments in respect of Immediate Operating Expenses
which are payable in accordance with the Cash Administration Agreement;
(iii)
at any time, any sums to be invested in Permitted Investments to be
deposited in the Principal Custody Account in the manner described in the
Cash Administration Agreement and the Paying Agency Agreement; and
(iv)
at any time, any repayments of sums due under the Loan Agreement out of
Withholding Tax Refunds which have been credited to the Issuer Account.
Expenses Reserve Account
(a)
The Issuer (acting through a Cash Administrator) shall procure that on each Payment
Date (other than a Payment Date on which the Junior Notes have previously been
redeemed in full or are scheduled to be redeemed in full) the amount required
pursuant to Condition 10(2) (Payment Date Priority of Payments) are paid into the
Expenses Reserve Account; and
(b)
The Issuer (acting through a Cash Administrator) shall procure payment of the
following amounts (and shall ensure that payment of no other amount is made) out of
the Expenses Reserve Account:
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(i)
on each Payment Date the balance standing to the credit of the Expenses
Reserve Account for disbursement in accordance with Condition 10(2)
(Payment Date Priority of Payments); and
(ii)
at any time, any sums to be invested in Permitted Investments to be
deposited in the Expenses Reserve Custody Account in the manner
described in the Cash Administration Agreement and the Paying Agency
Agreement; and
(iii)
at any time, in payment of Maintenance Expenses which are payable in
accordance with the Cash Administration Agreement.
12.
Limited Recourse, Non Petition
(1)
Limited Recourse: The Issuer shall have no assets available for payment of the Floating
Senior Coupon Payments, the Junior Coupon Payments, the Capital Payments and the Class A
Amortisation Amount other than Available Distribution Funds actually received and available
for use by the Issuer prior to the applicable Payment Date. In addition, the Issuer shall have no
assets available for any other payment, if any, in respect of the Compartment 2 Notes to the
Compartment 2 Noteholders, including in connection with any acceleration of Compartment 2
Notes pursuant to Condition 14 (Events of Default), other than Available Distribution Funds
actually received and available for use by the Issuer prior to the date on which such payments
fall due; such payments shall be made in accordance with, and subject to, the Priority of
Payments. Other than the Issuer Receipts and the aggregate amounts received in repayment of
the Advances, the Issuer shall have no other funds available to meet its obligations under the
Compartment 2 Notes and the Compartment 2 Notes shall not give rise to any payment
obligation in excess of the Available Distribution Funds. Claims in respect of any shortfall on
a Payment Date, or when any of the aforementioned payments fall due, will be payable on
each following Payment Date, subject to the Priority of Payments, until paid in full and failure
by the Issuer to make payment in respect of any such shortfall will not constitute a default by
the Issuer for any purpose. Any payment of any of Coupon Payments so deferred will not earn
interest. Claims in respect of any shortfall on the Legal Maturity Date shall be extinguished
and failure by the Issuer to make payment in respect of any such shortfall will not constitute a
default by the Issuer for any purpose. If the net proceeds of realisation of the security
constituted by the Trust Deed upon enforcement thereof in accordance with Condition 15
(Enforcement) and the provisions of the Trust Deed are less than the aggregate amount
payable in such circumstances by the Issuer in respect of the Compartment 2 Notes and the
Trust Deed and to the other Secured Parties (such negative amount being referred to herein as
a "shortfall"), the obligations of the Issuer in respect of the Compartment 2 Notes and the
Trust Deed and its obligations to the other Secured Parties in such circumstances will be
limited to such net proceeds which shall be applied in accordance with the Priority of
Payments. In such circumstances the other assets (if any) of the Issuer will not be available
for payment of such shortfall which shall be borne by the relevant Compartment 2
Noteholders, the Trustee and other Secured Parties in accordance with the Priority of
Payments (applied in reverse order), the rights of such persons to receive any further amounts
in respect of such obligations shall be extinguished and none of the Compartment 2
Noteholders, the Trustee or the other Secured Parties may take any further action to recover
such amounts.
(2)
Non Petition: Each of the Compartment 2 Noteholders, the Trustee or any other Secured
Parties (or any other person acting on behalf of any of them) has undertaken under the terms
and conditions of the Trust Deed not to institute against the Issuer or join in any institution
against the Issuer of any bankruptcy, reorganisation, arrangement, insolvency or liquidation
proceedings or other proceedings under any applicable bankruptcy or similar law in
connection with any obligations of the Issuer relating to the Compartment 2 Notes, the Trust
Deed or any other Transaction Document relating thereto, save for lodging a claim in the
liquidation of the Issuer which is initiated by another party or proceedings to obtain a
declaration or judgment as to the obligations of the Issuer in relation thereto.
71
13.
Payments
(1)
Discharge by Payment to the Clearing System: Principal Paying Agent has undertaken to
the Issuer pursuant to the Paying Agency Agreement to pay, on account of the Issuer and as
and when due, amounts paid to it by the Issuer in respect of amounts due on Compartment 2
Notes in Euro to the Principal Paying Agent for on-payment to the Compartment 2
Noteholders.
(2)
Payment on Business Days: If any payment of any amount with respect to any Compartment
2 Notes is to be made on a day that is not a business day in the place of presentation of such
Compartment 2 Notes, payment shall be made on the next following day that is a business day
in such place of presentation. In such case, the Compartment 2 Noteholders shall neither be
entitled to any payment claim nor to any interest claim or other compensation with respect to
such delay.
(3)
Payment on Definitive Notes: In the event that Definitive Notes representing individual
Compartment 2 Notes have been issued, payments of amounts due in respect of Compartment
2 Notes will be made against presentation and surrender (or, in the case of part payment only,
endorsement) of the relevant Definitive Note, except that payments of interest will be made
against presentation and surrender (or, in the case of part payment only, endorsement) of the
relevant Coupon, in each case at the office of a Paying Agent.
(4)
Unmatured Coupons and Receipts:
(a)
Upon the due date for redemption of any Compartment 2 Note, unmatured Coupons
and Receipts relating to such Compartment 2 Note (whether or not attached) shall
become void and no payment shall be made in respect of them.
(b)
Where any Compartment 2 Note is presented for redemption without all unmatured
Coupons or Receipts, redemption shall be made only against the provision of such
indemnity as the Issuer may require.
(c)
If the due date for redemption of any Compartment 2 Notes is not a due date for
payment of interest, interest accrued from the preceding due date for payment of
interest or the Issue Date, as the case may be, shall only be payable against
presentation (and surrender if appropriate) of the relevant Compartment 2 Note.
14.
Events of Default
(1)
Events of Default: The occurrence of any of the following events shall constitute an "Event
of Default":
(a)
principal or interest have not been paid within 10 days from the relevant due date in
accordance with Condition 6 (Coupon Payments) or Condition 7 (Redemption); or
(b)
the Issuer fails to duly perform any other material obligation arising under the
Compartment 2 Notes which failure affects or prejudices the performance of the
payment obligations under the Compartment 2 Notes and such failure continues for
more than 30 calendar days without cure after the Trustee has received notice thereof
from a Compartment 2 Noteholder; or
(c)
the dissolution of the Issuer or of its Compartment 2 which affects or prejudices the
performance of the payment obligations under the Compartment 2 Notes; or
(d)
a court orders the dissolution of the Issuer or institutes insolvency proceedings or
composition proceedings to avert insolvency or bankruptcy, or similar proceedings
against the assets of the Issuer are instituted and such proceedings are not discharged
or stayed within 60 days, or the Issuer applies for institution of such proceedings in
respect of its assets or offers or makes a general arrangement for the benefit of its
creditors generally, or a third party applies for insolvency proceedings against the
Issuer and such order or proceedings are not discharged or stayed within 60 days, in
72
each case if such order, institution or application affects or prejudices the
performance of the payment obligations under the Compartment 2 Notes; or
(e)
(2)
(3)
any event occurs which, under the laws of Luxembourg has an effect which is
analogous to any of the events referred to in any of paragraphs (a) to (d) above.
Acceleration
(a)
If an Event of Default occurs and is continuing, the Trustee, at its discretion, may,
subject to the consent, and shall at the request, of the Controlling Class at such time,
(in each case subject to being indemnified to its satisfaction, against all liabilities,
proceedings, claims and demands to which it may thereby become liable and all
costs, charges and expenses which may be incurred by it in connection therewith),
give notice to the Issuer that all the Compartment 2 Notes are to be immediately due
and payable.
(b)
Upon any such notice being given to the Issuer in accordance with paragraph (2)(a)
of this Condition 14 (Events of Default) all of the Compartment 2 Notes shall
immediately become due and repayable at their respective Outstanding Principal
Amounts together with accrued interest thereon.
Curing of Default: At any time after a notice of acceleration of the maturity of the
Compartment 2 Notes has been made following the occurrence of an Event of Default and
prior to enforcement of the security pursuant to Condition 15 (Enforcement), the Trustee shall,
if requested by the Controlling Class at such time, (in each case, subject to being indemnified
to its satisfaction against all liabilities, proceedings, claims and demands to which it may
thereby become liable and all costs, charges and expenses which may be incurred by it in
connection therewith) rescind and annul the notice of acceleration under paragraph (2)(a)
above (as the case may be) and its consequences if:
(a)
the Issuer has paid or deposited with the Trustee a sum sufficient to pay:
(i)
all payments of interest and principal (to the extent not subject to deferment)
due and payable in respect of, the Compartment 2 Notes other than the Junior
Notes;
(ii)
all due but unpaid taxes owing by the Issuer as certified by an authorised
officer of the Issuer to the Trustee;
(iii) all unpaid Maintenance Expenses and Administrative Expenses; and
(iv)
(b)
all amounts due and payable under the Swap Agreement; and
the Trustee has determined that all Events of Default, other than the non-payment of
the interest in respect of, or principal of, the Notes that have become due solely by
such acceleration, have been cured or waived.
Any previous rescission and annulment of a notice of acceleration pursuant to this paragraph
(3) shall not prevent the subsequent acceleration of the Notes if the Trustee at its discretion
accelerates or if the Trustee is subsequently requested or directed to accelerate the
Compartment 2 Notes (as the case may be).
(4)
Restriction on Acceleration of Compartment 2 Notes: No acceleration of the Compartment
2 Notes pursuant to Condition 14(2) (Acceleration) may be consented to, or requested by, the
holders of any Class of Compartment 2 Notes other than the Controlling Class.
(5)
Notification and Confirmation of No Default: The Issuer shall promptly notify the Trustee,
the Cash Administrator, the Transaction Adviser and the Rating Agencies upon becoming
aware of the occurrence of an Event of Default. The Trust Deed contains provisions for the
Issuer to provide written confirmation to the Trustee and the Rating Agencies on an annual
basis or on request that no Event of Default has occurred and that no condition, event or act
has occurred which, with the lapse of time and/or the issue, making or giving of any notice,
73
certification, declaration and/or request and/or the taking of any similar action and/or the
fulfilment of any similar condition could constitute an Event of Default and that no other
matter which is required (pursuant thereto) to be brought to the Trustee's attention has
occurred.
15.
Enforcement
(1)
Security Becoming Enforceable: The security constituted under the Trust Deed over the
Compartment 2 Collateral shall become enforceable upon an acceleration of the Issuer's
payment obligations under the Compartment 2 Notes pursuant to Condition 14 (Events of
Default).
(2)
Enforcement: At any time after the Compartment 2 Notes become due and payable and the
security under the Trust Deed becomes enforceable, the Trustee may at its discretion and
without further notice in accordance with all applicable laws, institute such proceedings
against the Issuer as it may think fit in accordance with the directions of the Controlling Class,
or in the absence of any such directions, as the Trustee in its discretion determines, to enforce
the terms of the Trust Deed in accordance with all applicable laws, and the Compartment 2
Notes and pursuant and subject to the terms of the Trust Deed, in accordance with all
applicable laws, realise and/or otherwise liquidate the Compartment 2 Collateral and/or take
such action as may be permitted under applicable laws against any obligor in respect of the
Compartment 2 Collateral and/or take any other action in accordance with all applicable laws,
to enforce the security over the Compartment 2 Collateral, in each case without any liability as
to the consequence of any action and without having regard to the effect of such action on
individual Compartment 2 Noteholders of any Class or any other Secured Party.
The Trustee shall not be bound to institute any such proceedings or take any such other action
unless it is (i) requested to do so in writing by the Controlling Class at such time and (ii) in
each case indemnified or secured to its satisfaction against all liabilities, proceedings, claims
and demands to which it may thereby become liable and all costs, charges and expenses which
may be incurred by it in connection therewith. Following redemption and payment in full of
the Senior Notes, the Trustee shall, (provided it is indemnified or secured to its satisfaction
against all liabilities, proceedings, claims and demands to which it may thereby become liable
and all costs, charges and expenses which may be incurred by it in connection therewith), if so
directed, act upon the directions of the holders of at least 66⅔ per cent. of the Outstanding
Principal Amount of the Junior Notes or as directed by an Extraordinary Resolution of the
holders of the Junior Notes.
In the event of any enforcement of the security of the Compartment 2 Collateral pursuant to
these Conditions and the Trust Deed, the Trustee, or the Issuer (or the Cash Administrator
acting on behalf of the Issuer) at the direction of the Trustee (provided that the Trustee shall
not be liable if the Issuer fails to comply with, or incorrectly follows, such directions) shall
take the following actions (or the Cash Administrator on behalf of the Issuer) (together the
"Final Redemption Actions"):
(a)
terminate the Swap Agreement;
(b)
realise and/or liquidate all the remaining Compartment 2 Collateral (the proceeds
thereof being the "Compartment 2 Collateral Liquidation Proceeds"); and
(c)
apply all remaining Compartment 2 Collateral Liquidation Proceeds in accordance
with the Priority of Payments.
(3)
Only Trustee to Act: Only the Trustee may pursue the remedies available under the Trust
Deed to enforce the rights of itself and as Trustee for the Compartment 2 Noteholders or any
of the other Secured Parties under the Trust Deed and the Compartment 2 Notes and no
Compartment 2 Noteholder or Secured Party may proceed directly against the Issuer or any of
its assets unless the Trustee, having become bound to proceed in accordance with the terms of
the Trust Deed, fails to do so within a reasonable period and such failure is continuing.
(4)
Purchase of Compartment 2 Collateral by Compartment 2 Noteholders: Upon any sale of
any part of the Compartment 2 Collateral following the occurrence of an Event of Default,
74
whether made under the power of sale under the Trust Deed or by virtue of judicial
proceedings, any Compartment 2 Noteholder may bid for and purchase the Compartment 2
Collateral or any part thereof and, upon compliance with the terms of sale, may hold, retain,
possess or dispose of such property in its or their own absolute right without accountability.
In addition, any purchaser in any such sale which is a Compartment 2 Noteholder may deliver
Compartment 2 Notes held by it in place of payment of the purchase price for such
Compartment 2 Collateral where the amount payable to such Compartment 2 Noteholder in
respect of such Compartment 2 Notes pursuant to the Priority of Payments out of the net
proceeds of such sale is equal to or exceeds the purchase moneys so payable.
16.
Prescription
Claims in respect of principal and interest payable on redemption in full of the relevant
Compartment 2 Notes will become void unless presentation for payment is made as required
by Condition 13 (Payments) within a period of five years, in the case of interest, and ten years,
in the case of principal, from the appropriate Relevant Date.
17.
Agents
(1)
Principal Paying Agent: BNP Paribas, Luxembourg branch shall be the initial principal
paying agent under the Paying Agency Agreement (the "Principal Paying Agent").
(2)
Irish Paying Agent: Custom House Administration & Corporate Services Limited shall be
appointed as additional paying agent (together with the Principal Paying Agent, the "Paying
Agents") under the Paying Agency Agreement. The Issuer shall procure that as long as
Compartment 2 Notes are listed on the Irish Stock Exchange, there will at all times be a
Paying Agent in Ireland. In no event shall the specified office of an Agent appointed by the
Issuer be within the United States of America or its possessions.
(3)
Account Bank: BNP Paribas, Luxembourg branch shall be the initial account bank under the
Paying Agency Agreement (the "Account Bank").
(4)
Custodian: BNP Paribas, Luxembourg branch shall be the initial custodian under the Paying
Agency Agreement (the "Custodian").
(5)
Calculation Agent: BNP Paribas Securities Services, Luxembourg branch shall be the initial
calculation agent under the Paying Agency Agreement (the "Calculation Agent").
(6)
Replacement of Agents: The Issuer shall procure that there will at all times be a Principal
Paying Agent. The Issuer shall be entitled to appoint banks of international standing (or their
associated entities) as Principal Paying Agent. Furthermore, the Issuer shall be entitled to
terminate the appointment of a bank as Principal Paying Agent. In the event of such
termination or such bank being unable or unwilling to continue to act as Principal Paying
Agent, the Issuer shall appoint another bank of international standing (or their associated
entities) as Principal Paying Agent. The Issuer shall to the extent possible procure that it will
at all times maintain an Agent with a specified office in a European Union member state that
will not be obliged to withhold or deduct tax pursuant to the European Council Directive
2003/48/EC or any other European Union Directive on the taxation of savings implementing
the conclusions of the ECOFIN Council meeting of 26–27 November 2000 or any law
implementing or complying with, or introduced in order to conform to, such Directive. Any
such appointment or termination shall be published without undue delay in accordance with
Condition 19 (Notices).
(7)
Agent Legal Matters: The Agents, acting in such capacity, act only as agents of the Issuer.
There is no agency or fiduciary relationship between the Agents on the one side and the
Compartment 2 Noteholders on the other side.
(8)
Rating Requirement: Each of the Account Bank, the Custodian and the Principal Paying
Agent shall at all times be a financial institution satisfying the Rating Requirement applicable
thereto, and which has the necessary regulatory capacity and licences to perform the services
required of the Account Bank, the Custodian and the Principal Paying Agent, respectively. If
any of the Account Bank, the Custodian or the Principal Paying Agent at any time fails to
75
satisfy such Rating Requirement, the Issuer shall procure that a replacement Account Bank,
Custodian or Principal Paying Agent, respectively, which satisfies the applicable Rating
Requirement and which is acceptable to the Trustee is appointed within 30 calendar days of
such downgrade in accordance with the Agency Agreement.
18.
Substitution
(1)
Substitution: The Issuer may, at any time and without the consent of the Compartment 2
Noteholders, substitute another company for the Issuer as principal debtor and creditor (the
"Other Company") in respect of all obligations and rights under and in connection with the
Compartment 2 Notes, the Profit Participation Agreements, the Subordinated Loan
Agreements and the Trust Deed as well as any other agreements related thereto, provided that:
(a)
the Issuer is not in default of any payment owed under the Compartment 2 Notes;
(b)
the Other Company assumes all rights and obligations of the Issuer under the
Compartment 2 Notes;
(c)
the Issuer and the Other Company have obtained all necessary permits and are
authorised to comply with the payment obligations under the Compartment 2 Notes
by paying the amounts due in Euro without being obliged to withhold or deduct
applicable tax or other duties of any kind in the respective country in which the Other
Company or the Issuer is domiciled or resident for tax purposes;
(d)
the Other Company has agreed to indemnify the Compartment 2 Noteholders against
such taxes, duties or other governmental charges as may be imposed on the
Compartment 2 Noteholders in connection with the substitution;
(e)
the substitution does not result in an increase in German withholding tax or any other
withholding tax, property tax, if applicable, trade income or any other income tax
payable by (i) the Other Company or (ii) its shareholders (if incorporated as a
corporation) or partners (if established as a partnership);
(f)
the Trustee has declared its consent to the substitution to the Issuer in writing; and
(g)
the Rating Agencies have confirmed in writing that the rating of the Compartment 2
Notes (if any) will not be adversely affected by the substitution.
(2)
Notification of Substitution: Any substitution in accordance with this Condition 18
(Substitution) shall be notified to Compartment 2 Noteholders in accordance with Condition
19 (Notices) hereof without undue delay.
(3)
Change in Reference: Upon substitution, any references in these Terms and Conditions to the
Issuer shall forthwith be deemed to be references to the Other Company and any references to
the country of domicile or tax residence of the Issuer shall forthwith be deemed to be
references to the country of domicile or tax residence of the Other Company, in each case,
with effect from the substitution date.
19.
Notices
(1)
Irish Stock Exchange: For so long as the Compartment 2 Notes are listed on the Irish Stock
Exchange and the rules of the Irish Stock Exchange so require, notices to Compartment 2
Noteholders will be valid if made to the Company Announcements Office of the Irish Stock
Exchange.
(2)
Direct Notices: The Issuer shall also be entitled to make notifications to the Clearing Systems
for communication by the Clearing Systems to the Compartment 2 Noteholders or directly to
the Compartment 2 Noteholders provided this complies with the rules of the stock exchange
on which the Compartment 2 Notes are listed. Notifications through the Clearing Systems
shall be deemed to be effective seven days after the notification to the Clearing Systems, and
valid direct notifications to the Compartment 2 Noteholders shall be deemed to be effective
upon their receipt.
76
(3)
Display at the Paying Agents: The text of any publication to be made in accordance with this
Condition 19 (Notices) shall also be available at the specified office of each Paying Agent.
(4)
Notice to the holders of the Junior Notes: Within two Business Days following each
Payment Date, the Calculation Agent on behalf of the Issuer shall issue a notice in accordance
with this Condition 19 (Notices) notifying the holders of the Junior Notes of the amount of
any such payment to be made to the holders of the Junior Notes and specifying whether such
payment is made on account of Junior Coupon Payments and/or Capital Payments in respect
of the Junior Notes.
20.
Meetings of Compartment 2 Noteholders; Modification and Waiver
(1)
Meetings of Compartment 2 Noteholders: The Trust Deed contains provisions for
convening meetings of the Compartment 2 Noteholders of each class to consider matters
affecting the interests of such Compartment 2 Noteholders, including the sanctioning by
Extraordinary Resolution of the Compartment 2 Noteholders of a class relating to
modification of certain Terms and Conditions and the provisions of the Trust Deed. The Issuer
or the Trustee may at any time convene a meeting. The Trustee shall convene a meeting of
Compartment 2 Noteholders if it receives a written request by Compartment 2 Noteholders
holding at least ten per cent. in aggregate principal amount of the Compartment 2 Notes for
the time being and the Trustee is indemnified to its satisfaction against all costs and expenses.
The quorum for any meeting convened to consider an Extraordinary Resolution of the
Compartment 2 Noteholders of any such class shall be two or more Compartment 2
Noteholders or agents present in person (being a holder of a voting certificate, or a proxy for,
or a representative of, a Compartment 2 Noteholder) holding or representing a clear majority
of the Compartment 2 Notes Outstanding, or at any adjourned meeting, the quorum shall be
two or more Compartment 2 Noteholders or agents (being a holder of a voting certificate or a
proxy for, or a representative of, a Compartment 2 Noteholder) holding or representing
Compartment 2 Notes of such class whatever the proportion of the Compartment 2 Notes
Outstanding.
The quorum for any meeting for any other purposes, including consideration of an Ordinary
Resolution of the Compartment 2 Noteholders of any such class shall be two or more
Compartment 2 Noteholders or agents present in person (being a holder of a voting certificate
or a proxy for, or a representative of, a Compartment 2 Noteholder ) holding or representing
not less than ten per cent. of the Compartment 2 Notes Outstanding, or at any adjourned
meeting, the quorum shall be two or more Compartment 2 Noteholders or agents (being a
holder of a voting certificate or a proxy for, or a representative of, a Compartment 2
Noteholder) holding or representing Compartment 2 Notes of such class whatever the
proportion of the Compartment 2 Notes Outstanding.
The following matters (each, an "Entrenched Matter") may be passed by the Compartment 2
Noteholders only by way of an Extraordinary Resolution of each class:
(a)
to sanction the exchange or substitution for the Compartment 2 Notes of, or the
conversion of the Compartment 2 Notes into, shares, bonds or other obligations or
securities of the Issuer or any other entity;
(b)
to approve the modification of any provision relating to the timing and/or
circumstances of redemption of the Compartment 2 Notes at maturity or otherwise
(including the circumstances in which payments on the Compartment 2 Notes may be
accelerated);
(c)
to approve the modification of the timing and/or determination of the amount of
interest, principal or other amounts payable in respect of the Compartment 2 Notes
from time to time;
(d)
to approve a change in the currency of payment of the Compartment 2 Notes;
(e)
to approve the adjustment of the aggregate principal amount of the Compartment 2
Notes;
77
(f)
to approve any change in the Priority of Payments as set out in Condition 10 (Priority
of Payments) or in the calculation or determination of any amounts payable
thereunder;
(g)
to approve the modification of the provisions concerning the quorum required at any
meeting of Compartment 2 Noteholders or the majority required to pass an
Extraordinary Resolution;
(h)
to approve the modification of the composition of the Compartment 2 Collateral, any
release of the security over the Compartment 2 Collateral or any provision relating to
the security over the Compartment 2 Collateral constituted by the Trust Deed except
as contemplated by these Terms and Conditions and the Trust Deed; and
(i)
to approve any amendment to or deletion of any of the above Entrenched Matters.
Any resolution of the Compartment 2 Noteholders of a class shall be binding on all the
Compartment 2 Noteholders of such class, whether or not they are present at the meeting and
each of them shall be bound to give effect to it accordingly.
The Trust Deed provides that a resolution in writing signed by or (to the satisfaction of the
Trustee) on behalf of the holders of not less than the percentage majority required at a meeting
held in respect of such resolution of the Compartment 2 Notes Outstanding who are for the
time being entitled to receive notice of a meeting in accordance with the provisions of the
Trust Deed shall for all purposes be as valid and effective as a resolution passed at a meeting
of the Compartment 2 Noteholders of that class duly convened and held.
(2)
Modification and Waiver
The Trust Deed provides that the Trustee may, without the consent of the Compartment 2
Noteholders or the Secured Parties, at any time and from time to time concur with the Issuer
(to the extent applicable) in making:
(a)
any modification to any of the provisions of the Trust Deed which in the opinion of
the Trustee is of a formal, minor or technical nature or is made to correct a manifest
error; or
(b)
any modification to the Trust Deed (except as mentioned in the Trust Deed) and any
waiver or authorisation of any breach or proposed breach of any of the provisions of
the Trust Deed which in the opinion of the Trustee it may be proper to make and
provided that the Trustee is of the opinion that such modification will not be
materially prejudicial to the interests of any class of Compartment 2 Noteholders or
any other Secured Party.
Any such modification may be made on such terms and subject to such conditions (if any) as
the Trustee may determine, shall be binding upon the Compartment 2 Noteholders and the
other Secured Parties and, unless the Trustee agrees otherwise, shall be notified by the Issuer
to the Rating Agencies so long as any of the Senior Notes remain Outstanding and shall be
notified to the Compartment 2 Noteholders in accordance with Condition 19 (Notices) as soon
as practicable thereafter. So long as any of the Senior Notes remains Outstanding, the Trust
Deed provides that the Issuer shall procure that any modification of any of the Conditions, the
Trust Deed or the Cash Administration Agreement is notified to the Rating Agencies. The
Trustee shall be entitled to obtain such advice as it sees fit in connection with giving its
consent to any such modification, authorisation or waiver and any such advice shall be paid
for by the Issuer.
21.
Final Clauses
(1)
Governing Law: The Trust Deed, the Compartment 2 Notes and the Coupons are governed
by and shall be construed in accordance with English law. For the avoidance of doubt, the
provisions of Articles 86 to 94-8 of the Luxembourg law of 10 August 1915 on commercial
companies, as amended, are hereby excluded.
78
(2)
Jurisdiction: The courts of England are to have jurisdiction to settle any disputes which may
arise out of or in connection with the Compartment 2 Notes, the Coupons and the Receipts and
accordingly any legal action or proceedings arising out of or in connection with the
Compartment 2 Notes, the Coupons and the Receipts ("Proceedings") may be brought in such
courts. The Issuer has in the Trust Deed irrevocably submitted to the jurisdiction of such
courts and waives any objection to Proceedings in any such courts whether on the ground of
venue or on the ground that that the Proceedings have been brought in an inconvenient forum.
This submission is made for the benefit of each of the Compartment 2 Noteholders and the
Trustee and shall not limit the right of any of them to take Proceedings in any other court of
competent jurisdiction nor shall the taking of Proceedings in one or more jurisdictions
preclude the taking of Proceedings in any other jurisdiction (whether concurrently or not).
(3)
Agent for Service of Process: The Issuer appoints Ashurst as its agent in England to receive
service of process in any Proceedings in England based on any of the Compartment 2 Notes
("Process Agent"). If for any reason the Issuer does not have such Process Agent in England,
it will promptly appoint a substitute Process Agent and notify the Trustee and the
Compartment 2 Noteholders of such appointment. Nothing herein shall affect the right to
service of process in any other manner permitted by law.
(4)
Replacement of Compartment 2 Notes: Any Global Note or Definitive Notes representing
individual Compartment 2 Notes or Coupons, which are lost, stolen, mutilated, defaced or
destroyed, may be replaced at the office of the Paying Agents, subject to all applicable laws
and stock exchange requirements, upon payment by the claimant of the expenses incurred in
connection with such replacement as a result of such terms as to evidence, security and
indemnity as the Issuer may reasonably require.
(5)
Severability: Should any of the provisions of these Terms and Conditions be or become
invalid or unenforceable in whole or in part, the validity or the enforceability of the remaining
provisions shall not in any way be affected or impaired thereby. In this case the invalid
provision shall be replaced by a provision which is, to the extent legally possible, in
accordance with the meaning and the economic purposes of the Terms and Conditions at the
time of the issue of the Compartment 2 Notes.
79
Schedules to the Terms and Conditions of the Compartment 2 Notes
Schedule A
Class A Amortisation Amounts
Date
Outstanding Class A Principal Balance*
13 April 2006
13 October 2006
13 April 2007
13 October 2007
13 April 2008
13 October 2008
13 April 2009
13 October 2009
13 April 2010
13 October 2010
13 April 2011
13 October 2011
13 April 2012
13 October 2012
13 April 2013
*
Class A Amortisation Amount
218,400,000
218,400,000
217,850,000
217,300,000
216,750,000
216,200,000
215,650,000
215,100,000
214,550,000
214,000,000
213,450,000
212,900,000
212,350,000
211,800,000
211,250,000
550,000
550,000
550,000
550,000
550,000
550,000
550,000
550,000
550,000
550,000
550,000
550,000
550,000
0
Note: the amounts listed in this column assume that no payments other than Class A Amortisation Amounts have been made in or towards
the redemption of the Class A Notes since the Issue Date.
Schedule B
Junior Redemption Amounts
Payment Date
Junior Redemption
Amount*
13 April 2006
13 October 2006
13 April 2007
13 October 2007
13 April 2008
13 October 2008
13 April 2009
13 October 2009
13 April 2010
13 October 2010
13 April 2011
13 October 2011
13 April 2012
13 October 2012
13 April 2013
*
31,350,000
31,900,000
32,450,000
33,000,000
33,550,000
34,100,000
34,650,000
35,200,000
35,750,000
36,300,000
36,850,000
37,400,000
37,950,000
38,500,000
Note: the Junior Redemption Amounts listed in this column are equal to the Outstanding Principal Amounts of the Junior Notes on the
relevant Payment Date, assuming no payments have been made in or towards the redemption of the Junior Notes since the Issue
80
Schedule C
Junior Coupon Rate
Accrual Period beginning
Junior Coupon Rate
13 April 2006
13 October 2006
13 April 2007
13 October 2007
13 April 2008
13 October 2008
13 April 2009
13 October 2009
13 April 2010
13 October 2010
13 April 2011
13 October 2011
13 April 2012
13 October 2012
13 April 2013
13 October 2013
17.15%
17.30%
17.45%
17.60%
17.75%
17.90%
18.05%
18.20%
18.35%
18.50%
18.65%
18.80%
18.95%
19.10%
0.00%
0.00%
81
USE OF PROCEEDS
The proceeds from the issue of the Compartment 2 Notes will amount to €280,000,000 and will be used
by the Issuer to make the Advances to the Portfolio Companies under the Financing Agreements.
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FORM OF THE COMPARTMENT 2 NOTES
The following is a summary of certain provisions to be contained in the Temporary Global Note and
the Permanent Global Note which apply to the Compartment 2 Notes of each Class.
Initial Issue of Compartment 2 Notes
The Compartment 2 Notes of each Class sold in reliance on Regulations S under the Securities Act
("Regulation S") will initially be represented on issue by a Temporary Global Note without interest
coupons deposited with BNP Paribas Securities Services, Luxembourg branch as common depositary
for Euroclear and Clearstream, Luxembourg. Each Temporary Global Note will be exchangeable in
whole or in part for interests in a Permanent Global Note not earlier than 40 days after the Closing Date
upon certification as to non-U.S. beneficial ownership. No payments will be made under a Temporary
Global Note unless exchange for interests in the Permanent Global Note is improperly withheld or
refused. In addition, interest payments in respect of the Compartment 2 Notes cannot be collected
without certification of non-U.S. beneficial ownership. Beneficial interests in the Global Notes may be
held only through Euroclear or Clearstream, Luxembourg at any time. See "Book-Entry Clearance
Procedures". Beneficial interests in Global Notes may not be held by a U.S. Person (as defined in
Regulation S or U.S. residents (as determined for the purposes of the Investment Company Act) at any
time. By acquisition of a beneficial interest in the Global Notes, the purchaser thereof will be deemed
to represent, among other things, that it is not a U.S. Person, and that, if in the future it determines to
transfer such beneficial interest, it will transfer such interest only to a person whom the seller
reasonably believes to be a non-U.S. Person in an offshore transaction in accordance with Rule 903 or
Rule 904 of Regulation S.
Except in the limited circumstances described below, owners of beneficial interests in Global Notes
will not be entitled to receive Definitive Notes.
Amendments to Conditions
Each Global Note contains provisions that apply to the Compartment 2 Notes that they represent, some
of which modify the effect of the Conditions of the Compartment 2 Notes set out in this Offering
Circular. The following is a summary of those provisions:
Payments
Payments of principal and interest in respect of the Global Notes will be made against presentation and,
in the case of payment of principal in full with all interest accrued thereon, surrender of such Global
Note at the specified office of any Paying Agent and will be effective to satisfy and discharge the
corresponding liabilities of the Issuer in respect of the Compartment 2 Notes. See also "Book-Entry
Clearance Procedures".
Notices
Notwithstanding Condition 19 (Notices) (and without prejudice to the requirements in such Condition
to publish notices in accordance with the rules and regulations of such stock exchange(s) on which the
Compartment 2 Notes are listed), while all the Compartment 2 Notes of any Class are represented by a
Global Note and the Global Note is deposited with a common depositary for Euroclear and
Clearstream, Luxembourg, notices to the relevant Compartment 2 Noteholders may be given by
delivery of the relevant notice to Euroclear and Clearstream, Luxembourg and, in any case, such
notices shall be deemed to have been given to the Compartment 2 Noteholders in accordance with
Condition 19 (Notices) on the date of delivery to Euroclear and Clearstream, Luxembourg.
For so long as any Compartment 2 Notes are listed on the Irish Stock Exchange and the rules of that
stock exchange or other relevant authority so require, such notice will be made to the Company
Announcements Office of the Irish Stock Exchange.
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Meetings
The holder of each Global Note will be treated as being two persons for the purposes of any quorum
requirements of, or the right to demand a poll at, a meeting of Compartment 2 Noteholders and, at any
such meeting, as having one vote in respect of each €50,000 principal amount of Compartment 2 Notes
represented by the relevant Global Note.
Trustee's Powers
In considering the interests of Compartment 2 Noteholders while the Global Notes are held on behalf
of a clearing system, the Trustee may have regard to any information provided to it by such clearing
system or its operator as to the identity (either individually or by category) of its account holders with
entitlements to each Global Note and may consider such interests as if such account holders were the
holders of any Global Note.
Cancellation
Cancellation of any Compartment 2 Note required by the Conditions to be cancelled will be effected by
reduction in the principal amount of the applicable Global Note.
Exchange for Permanent Global and Definitive Notes
Exchange
Each Temporary Global Note is exchangeable in whole or in part for interests in a Permanent Global
Note on or after the date which is 40 days after the completion of the distribution of all of the
Compartment 2 Notes (as determined and certified by the Initial Purchasers) upon certification as to
non-U.S. beneficial ownership in the form set out in the Temporary Global Note.
The Permanent Global Note will be exchangeable, free of charge to the holder, in whole but not in part,
for Definitive Notes on request of the bearer of the Permanent Global Note if (a) the Permanent Global
Note is held (directly or indirectly) on behalf of Euroclear and Clearstream, Luxembourg or an
alternative clearing system and any such clearing system is closed for business for a continuous period
of 14 days (other than by reason of holiday, statutory or otherwise) or announces an intention
permanently to cease business or does in fact do so or (b) an Event of Default occurs.
Delivery
Whenever a Permanent Global Note is to be exchanged for Definitive Notes, the Issuer shall procure
the prompt delivery (free of charge to the bearer) of such Definitive Notes, duly authenticated and with
Coupons and Receipts attached, in an aggregate principal amount equal to the principal amount of the
Permanent Global Note to the bearer of the Permanent Global Note against the surrender of the
Permanent Global Note at the specified office of the Principal Paying Agent within 30 days of the
bearer requesting such exchange.
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BOOK-ENTRY CLEARANCE PROCEDURES
The information set out below has been obtained from sources that the Issuer believes to be reliable,
but prospective investors are advised to make their own enquiries as to such procedures. In particular,
such information is subject to any change in or interpretation of the rules, regulations and procedures
of Euroclear or Clearstream, Luxembourg (together, the "Clearing Systems") currently in effect and
investors wishing to use the facilities of any of the Clearing Systems are therefore advised to confirm
the continued applicability of the rules, regulations and procedures of the relevant Clearing System.
The Issuer accepts responsibility solely for the correct reproduction of the information contained in
this section. None of the Issuer, the Trustee, the Initial Purchasers, the Transaction Adviser or any
Agent party to the Paying Agency Agreement (or any affiliate of any of the above, or any person by
whom any of the above is controlled for the purposes of the Securities Act), will have any responsibility
for the performance by the Clearing Systems or their respective direct or indirect participants or
accountholders of their respective obligations under the rules, regulations and procedures governing
their operations or for the sufficiency for any purpose of the arrangements described below.
Euroclear and Clearstream, Luxembourg
Custodial and depositary links have been established between Euroclear and Clearstream, Luxembourg
to facilitate the initial issue of the Compartment 2 Notes and cross-market transfers of the
Compartment 2 Notes associated with secondary market trading. (See "Settlement and Transfer of
Compartment 2 Notes" below).
Euroclear and Clearstream, Luxembourg each hold securities for their customers and facilitate the
clearance and settlement of securities transactions through electronic book-entry transfer between their
respective accountholders. Indirect access to Euroclear and Clearstream, Luxembourg is available to
other institutions which clear through or maintain a custodial relationship with an accountholder of
either system.
Euroclear and Clearstream, Luxembourg provide various services including
safekeeping, administration, clearance and settlement of internationally-traded securities and securities
lending and borrowing. Euroclear and Clearstream, Luxembourg also deal with domestic securities
markets in several countries through established depositary and custodial relationships. Euroclear and
Clearstream, Luxembourg have established an electronic bridge between their two systems across
which their respective customers may settle trades with each other. Their customers are world-wide
financial institutions including underwriters, securities brokers and dealers, banks, trust companies and
clearing corporations. Investors may hold their interest in such Global Notes directly through
Euroclear and Clearstream, Luxembourg if they are accountholders ("Direct Participants") or
indirectly ("Indirect Participants" and together with Direct Participants, "Participants") through
organisations which are accountholders therein.
Book-Entry Ownership
Each Global Note will have an ISIN and a Common Code and will be deposited with BNP Paribas
Securities Services, Luxembourg branch as common depositary for Euroclear and Clearstream,
Luxembourg.
Payments on Global Notes
Payments of any amounts owing in respect of the Global Notes will be made by or on behalf of the
Issuer in euro, to the Principal Paying Agent. The Principal Paying Agent will, in turn, make such
payments to the common depositary for Euroclear or Clearstream, Luxembourg which will distribute
such payments to Participants in accordance with their procedures.
Under the terms of the Trust Deed, the Issuer and the Trustee will treat the bearer of the Global Notes
(i.e., the common depositary for Euroclear or Clearstream, Luxembourg) as the owner thereof for the
purposes of receiving payments and for all other purposes. Consequently, none of the Issuer, the
Trustee or any agent of the Issuer or the Trustee has or will have any responsibility or liability for:
(a)
any aspect of the records of Euroclear or Clearstream, Luxembourg or any Participant or
Indirect Participant relating to or payments made on account of an ownership interest in a
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Global Note (a "Book Entry Interest") or for maintaining, supervising or reviewing any of
the records of Euroclear or Clearstream, Luxembourg or any Participant or Indirect Participant
relating to or payments made on account of a Book-Entry Interest; or
(b)
Euroclear or Clearstream, Luxembourg or any Participant or Indirect Participant.
Payments by Participants to owners of Book-Entry interest in the Global Notes held through these
Participants are the responsibility of such Participants.
Settlement and Transfer of Compartment 2 Notes
Subject to the rules, regulations and procedures of each applicable Clearing System, purchases of
Compartment 2 Notes held within a Clearing System must be made by or through Direct Participants,
which will receive a credit for such Compartment 2 Notes on the Clearing System's records. The
ownership interest of each actual purchaser of each such Compartment 2 Note (the "Beneficial
Owner") will in turn be recorded on the Direct and Indirect Participant's records. Beneficial Owners
will not receive written confirmation from any Clearing System of their purchase, but Beneficial
Owners are expected to receive written confirmations providing details of the transaction, as well as
periodic statements of their holdings, from the Direct and Indirect Participant through which such
Beneficial Owner entered into the transaction. Transfers of ownership interests in Compartment 2
Notes held within the Clearing Systems will be effected by entries made on the books of Participants
acting on behalf of Beneficial Owners. Beneficial Owners will not receive certificates representing
their ownership interests in such Compartment 2 Notes unless and until interests in any Global Notes
held within a Clearing System are exchanged for Definitive Notes.
No Clearing System has knowledge of the actual Beneficial Owners of the Compartment 2 Notes held
within such Clearing Systems and their records will reflect only the identity of the Direct Participants
to whose accounts such Compartment 2 Notes are credited, which may or may not be the Beneficial
Owners. The Participants will remain responsible for keeping account of their holdings on behalf of
their customers. Conveyance of notices and other communications by the Clearing Systems to Direct
Participants, by Direct Participants to Indirect Participants, and by Direct Participants and Indirect
Participants to Beneficial Owners will be governed by arrangements among them, subject to any
statutory or regulatory requirements as may be in effect from time to time.
Initial settlement for the Compartment 2 Notes will be made in euro.
Book-Entry Interests owned through Euroclear and Clearstream, Luxembourg accounts will follow the
settlement procedures applicable to conventional bonds in bearer form.
Secondary Market Trading
The Book-Entry Interests will trade through Participants of Euroclear and Clearstream, Luxembourg
and will settle in same-day funds.
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DESCRIPTION OF THE OTHER TRANSACTION DOCUMENTS
Terms and Conditions of the Profit Participation Agreements
Set forth below are the terms and conditions of the Profit Participation Agreements which have been
entered into by the Private Portfolio Companies. To the extent that there are material deviations from
the provisions set out below that have been agreed with individual Private Portfolio Companies, these
are set out under "The Portfolio Companies – Individual Portfolio Company Information".
THE GERMAN TEXT OF THE PROFIT PARTICIPATION AGREEMENT IS LEGALLY
BINDING. THE ENGLISH TRANSLATION IS FOR CONVENIENCE ONLY.
Angebot zum Abschluss einer
Genussrechtsvereinbarung zwischen
Offer for Conclusion of a Profit
Participation Right Agreement between
[Emittentin]
[Anschrift]
[Issuer]
[Address]
(im Folgenden "Emittentin" genannt
(hereinafter referred to as "Issuer")
und
and
[Firmal
[Anschrift]
[Company name]
[Address]
(im Folgenden "Gläubigerin" genannt)
(hereinafter referred to as "Creditor")
§1
§1
Issuance of Participation Right
EINRÄUMUNG EINES
GENUSSRECHTS
1.1
Die Emittentin bietet der Gläubigerin
hiermit unwiderruflich an, dieser nach
Maßgabe
der
nachfolgenden
Bestimmungen ein Genussrecht (das
"Genussrecht")
im
Betrag
von
höchstens EUR [Betrag] (in Worten:
Euro [Betrag in Worten]) (der
"Höchstnominalbetrag")
und
mindestens EUR [Betrag] (in Worten:
Euro [Betrag in Worten]) (der
"Mindestnominalbetrag") einzuräumen
(das "Angebot"). Die Gläubigerin
bestimmt, in den Grenzen zwischen
Mindestnominalbetrag
und
Höchstnominalbetrag,
in
welchem
Nominalbetrag (der "Nominalbetrag")
das
Genussrecht
entsteht.
Den
Nominalbetrag teilt die Gläubigerin der
Emittentin durch Übersendung der als
Anlage 0 beigefügten Notice mit. Die als
Anlage 1.1 beigefügte Notice ist
zusammen mit dem unterzeichneten
Angebot der Emittentin zu übersenden.
Auf den Nominalbetrag entsteht ein
Disagio von 4%.
1.1
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The Issuer hereby irrevocably offers to
grant the Creditor a profit participation
right (the "Participation Right") in an
amount of up to EUR [amount] (in words:
[amount in words] Euros) (the
"Maximum Nominal Amount") and not
less than EUR [amount] (in words:
[amount in words] Euros) (the
"Minimum Nominal Amount") (the
"Offer") in accordance with the following
provisions. The Creditor determines,
limited by the Minimum Nominal
Amount and the Maximum Nominal
Amount, in which Nominal Amount (the
"Nominal Amount") the Participation
Right comes into existence. The Creditor
informs the Issuer regarding the Nominal
Amount by sending over the Notice
attached as Attachment 1.1 to the Issuer.
The Notice attached as Attachment 1.1
should be sent to the Issuer together with
a signed copy of this agreement. There
will be a discount in the amount of 4 per
cent of the Nominal Amount.
1.2
Die Gläubigerin kann das Angebot nur
innerhalb eines Zeitraumes von drei
Monaten ab Zugang dieses Angebots
annehmen. Mit fristgerechter Absendung
des unterzeichneten Angebots und der
als Anlage 0 beigefügten Notice gilt das
Angebot
als
angenommen
(die
"Angebotsannahme").
Mit
Angebotsannahme wird das Genussrecht
zugunsten der Gläubigerin begründet.
Der Tag der Angebotsannahme wird
nachfolgend
als
"Anfangsdatum"
bezeichnet.
1.2
The Creditor may only accept the Offer
within a period of three months after
receipt of this Offer. The sending of the
undersigned Offer and the Notice attached
as Attachment 1.1 within the prescribed
time limit is considered as binding
acceptance of the Offer (the "Acceptance
of the Offer"). Upon Acceptance of the
Offer the Participation Right is
constituted in favour of the Creditor. The
date of the Acceptance of the Offer is
hereinafter
referred
to
as
the
"Commencement Date".
1.3
Die Anweisung des Nominalbetrages auf
ein von der Emittentin noch zu
benennendes Konto ist abzüglich des
Disagios in Höhe von 4 % drei
Geschäftstage nach Angebotsannahme
fällig. Die Emittentin hat den Tag der
Wertstellung des Nominalbetrages auf
ihrem
Konto
der
Gläubigerin
unverzüglich schriftlich mitzuteilen.
"Geschäftstag"
im
Sinne
dieser
Vereinbarung ist jeder Tag (mit
Ausnahme von Samstag und Sonntag),
an dem das Trans-European Automated
Real-Time Gross Settlement Express
Transfer System (TARGET) oder sein
Nachfolgesystem Zahlungen in Euro
abwickelt.
1.3
The transfer of the Nominal Amount less
the discount in the amount of 4 per cent to
the bank account of the Issuer shall be due
within 10 Business Days after the
Acceptance of the Offer. The Issuer shall
notify the Creditors on the details of his
bank account. The Issuer shall notify the
Creditor without undue delay in writing
the value date of the Nominal Amount on
its account (the "Value Date"). "Business
Day" for the purposes of this agreement
shall be any day (with the exception of
Saturday and Sunday) on which the
Trans-European Automated Real-Time
Gross Settlement Express Transfer
System (TARGET) or its successor
system settles payments in Euros.
3.1
§2
BERECHTIGUNG
§2
Entitlement
Die Emittentin garantiert im Wege einer
selbständigen Garantie, dass die
Voraussetzungen für eine wirksame
Begründung
des
Genussrechts
vorgelegen haben, die Begründung durch
die zuständigen Organe der Emittentin
autorisiert ist und dass etwaige
Bezugsrechte der Gesellschafter der
Emittentin wirksam ausgeschlossen
wurden.
The Issuer hereby guarantees by way of
an independent guarantee, that the
prerequisites for a valid constitution of
the Participation Rights are fulfilled, that
the constitution is authorised by the
competent corporate bodies of the Issuer
and that subscription rights (if any) of the
Issuer were effectively excluded. A
verification of the authorisation by the
competent corporate bodies is attached to
this agreement.
§3
RECHTSSTELLUNG DER
GLÄUBIGERIN
§3
Legal Status of the Creditor
Durch diese Vereinbarung wird kein
Gesellschaftsverhältnis zwischen der
3.1
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No partnership whatsoever shall be
constituted between the Issuer and the
Emittentin
begründet.
3.2
und
der
Gläubigerin
Das
Genussrecht
gewährt
auf
schuldrechtlicher
Grundlage
Gläubigerrechte,
jedoch
keine
Gesellschafterrechte an der Emittentin,
insbesondere
keine
Teilnahme-,
Mitwirkungs- und Stimmrechte in den
Gesellschafterversammlungen
oder
Bezugsrechte auf neue Anteile. Der
Gläubigerin steht kein Weisungsrecht
gegenüber der Unternehmensleitung der
Emittentin zu.
Creditor as a result of this agreement.
3.2
§4
BETEILIGUNG AM ERLÖS DER
LIQUIDATION
The Participation Right grants creditor
rights to the Issuer on the basis of the
German law of obligations. It does not
grant any shareholder rights in the Issuer,
in particular, no rights of attendance,
participation and voting rights at the
shareholders' meetings or rights to
subscribe to newly issued shares. The
Creditor shall not be entitled to issue
instructions to the management of the
Issuer.
§4
Participation in the Proceeds of the
Liquidation
Das Genussrecht gewährt keinen Anteil
am Liquidationserlös.
The Participation Right shall not grant
any share in liquidation proceeds.
§5
ZINS
5.1
Zins
§5
Interest
5.1
Die Gläubigerin erhält als Gegenleistung
für
die
Bereitstellung
des
Nominalbetrages vom Anfangsdatum
(einschließlich) bis zum Fälligkeitstag
i.S.v. Ziffer 0 von der Emittentin eine
feste Verzinsung in Höhe des SiebenJahres-EUR-Swapsatz Brief zuzüglich
410 Basispunkte p.a berechnet auf den
Nominalbetrag (der "Zins"). Der SiebenJahres-EUR-Swapsatz
Brief
(der
"Sieben-Jahres-EUR-Swapsatz Brief")
ist der am Anfangsdatum um 11:00 MEZ
auf der Referenzseite "ISDAFIX2" des
Reuters Services Informationssystems
veröffentlichte
Sieben-Jahres-EURSwapsatz auf EURIBOR Basis. Wird das
Reuters Services Informationssystem
ersetzt
oder
ändert
sich
die
Referenzseite, so ist die Nennung auf der
entsprechenden
Nachfolgeseite
maßgeblich. Der Zins wird auch dann
gewährt, wenn der Jahresabschluss der
Emittentin
keinen
ausreichenden
Jahresüberschuss ausweist.
5.2
Fälligkeit des Zinses
The Creditor shall receive a fixed rate of
interest on the Nominal Amount of 410
basis points above the seven-year EUR
swap offer rate in consideration for
providing the Nominal Amount from (and
including) the Commencement Date up to
(and excluding) the Due Date within the
meaning of clause 10.1 (the "Interest").
The seven-year swap offer rate (the
"Seven-Year Swap Offer Rate") shall be
defined as the seven-year swap rate
calculated on the basis of EURIBOR, as
displayed on the Reuters services
information system page "ISDAFIX2" at
11 am CET on the Commencement Date.
In the event that the Reuters services
information system is being replaced or in
the event that the reference page is being
changed, the information on the successor
page will be applicable. The Interest shall
also be granted, if the non-consolidated
annual financial statements of the Issuer
does not reveal sufficient annual surplus
in a fiscal year.
5.2
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Interest
Interest Payment Date
Der Zins ist am 20. März, 20. Juni, 20.
September und 20. Dezember eines jeden
Kalenderjahres
(jeweils
ein
"Zahlungstermin") für das jeweils zum
Ende des betreffenden Kalendermonates
endende Kalenderquartal pro rata
temporis gemäß Ziffer 5.3 fällig und
zahlbar. Fällt das Anfangsdatum nicht
auf den ersten Kalendertag eines
Quartals, so wird der Zins für das
unvollständige Quartal pro rata temporis
gemäß Ziffer 0 berechnet. Fällt der
Fälligkeitstag gemäß Ziffer 0 nicht auf
den letzten Kalendertag eines Quartals,
so ist auch der Zins für dieses
unvollständige Quartal pro rata temporis
gemäß Ziffer 0 zu leisten.
5.3
Pro-rata-Berechnung
The Interest shall be due and payable on a
pro rata basis pursuant to clause 5.3 on 20
March, 20 June, 20 September and 20
December of each respective calendar
year (in each case a "Payment Date"). In
the event that the Commencement Date
does not fall on the first calendar day of a
quarter, the Interest shall be calculated for
the incomplete quarter on a pro-rata basis
pursuant to clause 5.3. In the event that
the Due Date pursuant to clause 10.1 does
not fall on the last calendar day of a
quarter, the Interest shall also be paid for
the that incomplete quarter on a pro-rata
basis pursuant to clause 5.3.
5.3
Soweit der Zins für einen Zeitraum pro
rata temporis zu berechnen ist, wird er
auf der Basis der tatsächlichen Anzahl
von Tagen in dem maßgeblichen
Zeitraum, dividiert durch die Anzahl der
Tage (365 bzw. 366) im jeweiligen
Zinsjahr, berechnet.
5.4
Erhöhter Zins
Pro-rata Calculation
Where the Interest is to be calculated on a
pro-rata basis for a period, it shall be
calculated on the basis of the actual
number of days in the material period,
divided by the number of days (365 or, as
the case may be, 366) of the respective
interest year.
5.4
Wird
der
Zins
nach
seinem
Zahlungstermin gemäß Ziffer 0 gezahlt,
so erhöht er sich für den Zeitraum vom
Tag des jeweiligen Zahlungstermins
(ausschließlich) bis zu dem Tag der
tatsächlichen Leistung (einschließlich)
pro rata temporis gemäß Ziffer 0 auf
Increased Interest
In the event that the Interest is paid after
its Payment Date pursuant to clause 5.2,
the Interest shall be increased for the
period from the respective Payment Date
(exclusively) up to and including the date
of the actual payment on a pro-rata basis
pursuant to clause 5.3, to
(a)
15 % p.a. des Nominalbetrages,
wenn
die
Emittentin
der
Verpflichtung zur Zahlung des
Zinses
erstmalig
an
einem
Zahlungstermin nicht fristgerecht
nachkommt, und auf
(a)
15 per cent. p.a. of the Nominal
Amount where the Issuer fails to
fulfil its Interest payment obligation
on a Payment Date within the time
limit for the first time, and
(b)
20 % p.a. des Nominalbetrages,
wenn
die
Emittentin
der
Verpflichtung zur Zahlung an zwei
aufeinanderfolgenden
Zahlungsterminen nicht fristgerecht
nachkommt.
(b)
20 per cent. p.a. of the Nominal
Amount where the Issuer fails to
fulfil its Interest payment obligation
within the time limit on two
consecutive Payment Dates.
§6
§6
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BILANZBEURTEILUNG
6.1
Bilanzbeurteilung
Assessment of Financial Statements
6.1
Die Emittentin unterwirft sich für jedes
Geschäftsjahr
einer
jährlichen
Bilanzbeurteilung
(die
"Bilanzbeurteilung") nach Moody's
KMV RiskCalc, welche auf Grundlage
des nach Ziffer 0 an die Gläubigerin zu
übermittelnden Jahresabschlusses von
der Gläubigerin oder einen durch sie
beauftragten Dritten erstellt wird. Die
Bilanzbeurteilung wird durch Moody's
KMV Company durchgeführt.
Assessment of Financial Statements
For each business year, the Issuer shall be
subject to an annual assessment of his
financial statements (the "Assessment of
Financial Statement") applying Moody's
KMV RiscCalc. The Assessment of
Financial Statement shall be made by the
Creditor or a third party instructed by the
Creditor on the basis of the financial
statement of the Issuer to be sent to the
Creditor pursuant to clause 11.1. The
Assessment of Financial Statement will
be made by Moody's KMV Company.
6.2
Die im Zusammenhang mit der
jährlichen
Bilanzbeurteilung
entstehenden Kosten werden von der
Gläubigerin getragen.
6.2
Any costs in relation to the Assessment of
Financial Statements will be borne by the
Creditor.
6.3
Die Gläubigerin ist verpflichtet, das
Ergebnis der Bilanzbeurteilung innerhalb
von 30 Geschäftstagen nach Erhalt des
Jahresabschlusses
der
Emittentin
schriftlich bekannt zu geben. Ein
Nichteinhalten dieser Bekanntgabefrist
hat die Gläubigerin nicht zu vertreten,
wenn dies auf einer durch Moody's KMV
Company zu vertretenden Verzögerung
der Durchführung der Bilanzbeurteilung
beruht. Auf Verlangen stellt die
Gläubigerin der Emittentin auch die dem
Ergebnis
der
jeweiligen
Bilanzbeurteilung nach Moody's KMV
RiskCalc zugrundeliegenden Daten zur
Verfügung.
6.3
The Creditor shall be obliged to notify the
Issuer in writing within 30 business days
after receipt of the financial statement of
the Issuer on the result of the Assessment
of Financial Statements. The Creditor
shall not be liable for any breach of the
term of the aforementioned information
obligation, if such breach is based on a
delay in the Assessment of Financial
Statements for which Moody's KMV
Company is responsible. On demand of
the Issuer the Creditor will send to the
Issuer a copy of the data on which the
respective Assessment of Financial
Statement by Moody's KMV RiskCalc is
based.
6.4
Unterschreitet die Bilanzbeurteilung der
Emittentin für zwei aufeinanderfolgende
Geschäftsjahre Baa3.edf, so erhöht sich
für den Zeitraum vom Tag der
Bekanntgabe
der
zweiten
Bilanzbeurteilung an die Emittentin
gemäß Ziffer 0 bis zum Tag der
Bekanntgabe der Bilanzbeurteilung für
das
folgende
Geschäftsjahr
(ausschließlich) der geschuldete Zins
gemäß Ziffer 0 um 50 Basispunkte p.a
berechnet auf den Nominalbetrag.
6.4
If the Assessment of Financial Statement
falls short of Baa3.edf for two subsequent
business years, the interest payable
pursuant to clause 5.1 will be increased
by 50 basis points on the Nominal
Amount from the day of notification
regarding the second Assessment of
Financial Statement to the Borrower
pursuant to clause 6.3 up to the date of the
issuance of the Assessment of Financial
Statements for the following business
year (excluding).
§7
§7
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9.1
KAPITALERTRAGSTEUER
Withholding Tax
Vom Zins wird von der Emittentin die
gesetzlich
vorgeschriebene
Kapitalertragsteuer einbehalten und
abgeführt. Eine Ausgleichsverpflichtung
der
Emittentin
gegenüber
der
Gläubigerin
hinsichtlich
der
einbehaltenen Steuer besteht nicht.
The statutorily mandatory tax on capital
income shall be withheld from the Interest
and paid over by the Issuer. The Issuer is
not under an obligation to make a
compensatory payment to the Creditor in
respect of the withheld tax.
§8
LAUFZEIT
§8
Term of Participation Rights
Die Laufzeit beginnt mit dem
Anfangsdatum und endet mit dem
siebten Jahrestag des Anfangsdatums
(das "Enddatum").
The term of the Participation Right shall
start at the Commencement Date and shall
end at the seventh anniversary of the
Commencement Date (the "End Date").
§9
Außerordentliche Kündigung
§9
Extraordinary Termination
Die Emittentin wie auch die Gläubigerin
sind berechtigt, das Genussrecht aus
wichtigem Grund jederzeit, ohne
Rücksicht auf Termin und Frist
schriftlich
zu
kündigen
(die
"Außerordentliche Kündigung"). Als
wichtiger Grund für die Kündigung
durch die Gläubigerin gilt insbesondere:
9.1
Both the Issuer and the Creditor may
terminate the Participation Right at any
time in writing for good cause, regardless
of any date and notice period and with
immediate
effect
("Extraordinary
Termination"). A good cause for a
termination by the Creditor shall
particularly be:
(a)
die Liquidation der Emittentin;
(a)
liquidation of the Issuer;
(b)
die
Eröffnung
eines
Insolvenzverfahrens
über
das
Vermögen der Emittentin oder die
Abweisung der Eröffnung eines
derartigen Verfahrens mangels
Masse;
(b)
institution
of
insolvency
proceedings over the assets of the
Issuer or the dismissal of a petition
to open such proceedings against
the Issuer due to insufficient assets;
(c)
die Veräußerung, Verpfändung
oder sonstige Belastung der
Geschäftsanteile an der Emittentin
oder deren Umwandlung, soweit
dadurch ein Kontrollwechsel im
Sinne
des
Erwerbs
einer
Mehrheitsbeteiligung
gemäß
§ 16 AktG durch eine bisher nicht
mehrheitlich an der Emittentin
beteiligte Partei erfolgt (der
"Kontrollwechsel");
(c)
disposal,
pledge
or
other
encumbrance of shares in the Issuer
or a transformation of the Issuer to
the extent that such event results in
a change of control within the
terms of the acquisition of a
majority interest pursuant to Sec.
16 German Act on Public Limited
Companies (AktG) by a party,
which has not prior to such
acquisition held a majority interest
in the Issuer before (the "Change
of Control");
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(d) die fehlende Autorisierung
Begebung des Genussrechts
Emittentin
durch
zustimmungsbefugten Organe
Emittentin;
zur
der
die
der
(d)
lack of authorisation on the part of
the competent bodies of the Issuer
to grant the Participation Right;
(e)
die
Verletzung
der
Informationsrechte der Gläubigerin
nach dieser Vereinbarung durch die
Emittentin, es sei denn, die
Verletzung
ist
für
die
Wahrnehmung der Rechte der
Gläubigerin nicht wesentlich, sowie
die ausdrückliche oder konkludente
Weigerung der Emittentin, den
unter
"zusätzliche
Informationsrechte"
bestimmten
Workshop durchzuführen;
(e)
breach by the Issuer of the
Creditor's information rights under
this agreement, unless such breach
is immaterial for the claim of the
Creditor's rights, as well as the
explicit or implied refusal by the
Issuer
to
conduct
certain
workshops as defined in the clause
referring to "additional information
rights";
(f)
die Verletzung der Verpflichtung
der Emittentin zur Aufstellung und
Feststellung des geprüften Jahresund Konzernabschlusses innerhalb
der in Ziffer 0 bestimmten Frist,
soweit die Emittentin nach den
maßgeblichen
gesetzlichen
Vorschriften zur Aufstellung und
Prüfung derartiger Abschlüsse
verpflichtet ist;
(f)
breach by the Issuer of the
obligation to prepare and approve
the audited unconsolidated and
consolidated
annual
financial
statements within the time limits
provided by clause 11.1, where the
Issuer is obliged pursuant to the
relevant statutory provisions to
prepare and audit such financial
statements;
(g) eine
durch
die
Emittentin
vorgenommene Maßnahme, die
außerhalb ihres ordentlichen und
üblichen Geschäftsbetriebs liegt
(insbesondere die vollständige oder
teilweise
Einstellung
des
Geschäftsbetriebs
oder
eine
Umwandlung), sofern dadurch die
wirtschaftliche Grundlage der
Emittentin gefährdet und die
Rechtsstellung
oder
das
wirtschaftliche
Interesse
der
Gläubigerin
wesentlich
beeinträchtigt wird;
(g)
any action taken by the Issuer
which does not form part of its
ordinary and usual business
(including, but not limited to, the
full or partial cessation of business
operations or the transformation of
the Issuer), to the extent that such
action has a potential adverse effect
on the economic status of the Issuer
resulting in a material impairment
of the legal status or the economic
interest of the Creditor;
(h) die
auf
einen
Gewinnverteilungsbeschluss
beruhende
Ausschüttung
von
Gewinnen der Emittenten an die
Gesellschafter der Emittenten, die
vor einer vollständigen Zahlung der
fälligen Zinsen an die Gläubigerin
(h)
distributions of profits
of the Issuer based on a profit
distribution resolution made to the
shareholders of the Issuer prior to
the full payment of the due Interest
to the Creditor;
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erfolgt;
9.2
(i)
die
Kapitalherabsetzung
oder
sonstige
Rückführung
von
Eigenkapital (zusammen die "EKRückführung") der Emittentin,
soweit die EK-Rückführung mehr
als 25 % des Nominalbetrages des
Genussrechts beträgt. Beträgt die
EK-Rückführung weniger als 25 %
des
Nominalbetrages
des
Genussrechts, so stellt die EKRückführung
einen
wichtigen
Grund dar, soweit hierdurch die
Bedienung
der
Zinsen
des
Genussrechts
sowie
dessen
Rückzahlung
zum
Enddatum
gefährdet
würde.
Die
entsprechenden Umstände der EKRückführung sind durch die
Emittentin auf Verlangen der
Gläubigerin nachzuweisen. Die auf
einem Gewinnverteilungsbeschluss
beruhende
Ausschüttung
von
Gewinnen der Emittenten gilt nicht
als Rückführung von Eigenkapital
im Sinne dieser Ziffer. Vorstehende
Ziffer 0 bleibt unberührt; und
(i)
the capital redemption or other
repayment of equity (together the
"Equity Repayment") of the
Issuer provided that the Equity
Repayment amounts to more than
25 per cent. of the Nominal
Amount of the Participation Right.
If the Equity Repayment amounts
to less than 25 per cent. of the
Nominal
Amount
of
the
Participation Right the Equity
Repayment shall be a good cause
for termination if the Equity
Repayment is jeopardizing the
payment of the Interest or the
repayment of the Participation
Right at the End Date. The Issuer
shall inform the Creditor on the
circumstances of the Equity
Repayment by request of the
Creditor. The distributions of
profits of the Issuer based on a
profit distribution resolution shall
not be deemed as an Equity
Repayment within the meaning of
this clause. Clause 9.1 (h) shall
remain unaffected; and
(j)
die Verletzung von wesentlichen
Verpflichtungen
nach
dieser
Vereinbarung (insbesondere die
Rückführung von Darlehen gemäß
Ziffer 0 ohne die vorherige
Zustimmung der Gläubigerin).
(j)
the breach of important duties of
the Issuer pursuant to this
agreement
(especially
the
repayment of loans pursuant to
clause 16 (b) without the prior
consent of the Creditor).
Die Außerordentliche Kündigung auf
Grund eines Kontrollwechsels gemäß 0
kann nur ausgeübt werden, wenn die
Emittentin
nicht
innerhalb
von
25 Geschäftstagen
nach
dem
Kontrollwechsel
gegenüber
der
Gläubigerin schriftlich nachweist, dass
durch
den
Kontrollwechsel
die
Bilanzbeurteilung der Emittentin (unter
Berücksichtigung des oder der neuen
Gesellschafter und der Umstände des
Kontrollwechsels) nicht unter Baa3.edf
Moody's RiskCalc absinkt.
9.2
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The Extraordinary Termination caused by
a Change of Control pursuant to clause
9.1 (c) shall only be exercisable, if the
Issuer would not prove within 25 business
days after the Change of Control to the
Creditor in writing that the Assessment of
Financial Statement of the Issuer is not
lowered by the Change of Control under
Baa3.edf Moody's RiskCalc. The new
shareholder(s) and the circumstances of
the Change of Control shall be taken into
account.
§ 10
Rückzahlung
§ 10
Repayment
10.1
Der Nominalbetrag des Genussrechts
wird am Enddatum vorbehaltlich des
Rangrücktritts
nach
Ziffer 0
zur
Rückzahlung fällig und zahlbar. Im Falle
einer Außerordentlichen Kündigung wird
der Nominalbetrag des Genussrechts
vorbehaltlich des Rangrücktritts nach
Ziffer 0 am 30. Geschäftstag nach
Zugang der Kündigungserklärung zur
Rückzahlung fällig und zahlbar. Der
Tag, an dem der Nominalbetrag nach
dieser Ziffer 0 zur Rückzahlung fällig
wird,
wird
als
"Fälligkeitstag"
bezeichnet.
10.1
On the End Date, the Nominal Amount of
the Participation Right shall become due
and payable for repayment subject to
subordination pursuant to clause 13. In
the event of Extraordinary Termination,
the Nominal Amount of the Participation
Right shall become due and payable for
repayment on the 30th Business Day after
receipt of the notice of termination,
subject to subordination pursuant to
clause 13. The day on which the Nominal
Amount becomes due for repayment
under this clause 10.1 is referred to as the
"Due Date".
10.2
Sollte eine Außerordentliche Kündigung
durch die Gläubigerin vor dem
Enddatum wirksam werden, so ist neben
dem Nominalbetrag und gleichzeitig mit
diesem auch die Summe aller Beträge
der Zinsen, die bis zum Enddatum
angefallen wären, fällig und zahlbar. Der
Zeitraum zwischen Wirksamwerden der
Außerordentlichen Kündigung und dem
Enddatum wird "Restlaufzeit" genannt.
10.2
In the event that Extraordinary
Termination by the Creditor becomes
effective prior to the End Date, the sum of
all Interest amounts which would have
been accrued by the End Date, shall, in
addition to the Nominal Amount, also be
due and payable at the same time as the
Nominal Amount. The period between the
effectiveness
of
Extraordinary
Termination and the End Date shall be
referred to as the "Residual Term".
10.3
Von dem für die Restlaufzeit zu
zahlenden Zins ist der Ertrag abzuziehen,
den eine Anlage des Nominalbetrages in
eine Anleihe der Bundesrepublik
Deutschland, welche zum Enddatum
fällig ist, für die Restlaufzeit erbringen
würde. Der Abzug erfolgt jedoch nur
insoweit, als dieser Ertrag den Zins der
Restlaufzeit nicht übersteigt. Bei der
Berechnung des Ertrages sind die bei
einer derartigen Anlage üblicherweise
anfallenden Gebühren vom Ertrag
abzuziehen.
10.3
The revenue which would have been
realised from an investment of the
Nominal Amount for the Residual Term
on the basis of an investment in a bond
issued by the Federal Republic of
Germany and with a maturity date on the
End Date and shall be deducted from the
Interest. A deduction shall be made,
however, only to the extent that this
revenue does not exceed the Interest of
the Residual Term. When calculating the
revenue, any charges usual for such
investment shall be deducted from the
revenue.
10.4
Der Zinslauf endet am Fälligkeitstag
(einschließlich).
Erfolgt
am
Fälligkeitstag keine vollständige Zahlung
des
Nominalbetrages
durch
die
Emittentin an die Gläubigerin, so steht
der Gläubigerin auch für den Zeitraum
vom Fälligkeitstag (einschließlich) bis
zum Tag der tatsächlichen vollständigen
10.4
The interest payment period shall end on
and include the Due Date. In the event
that full payment of the Nominal Amount
is not made to the Creditor by the Issuer
on the Due Date, the Creditor shall also
be entitled to Interest accruing on a prorata basis pursuant to clause 5.3 for the
period as of the Due Date (including the
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Zahlung
des
Nominalbetrages
(einschließlich) der pro rata temporis
gemäß Ziffer 0 anfallende Zins zu.
Ziffer 0 findet entsprechend Anwendung.
Due Date) up to and including the date of
actual full payment of the Nominal
Amount. Clause 5.4 is to be applied
accordingly.
§ 11
INFORMATIONSRECHTE DER
GLÄUBIGERIN
§ 11
Information Rights of the Creditor
11.1
Die Emittentin ist verpflichtet, der
Gläubigerin
unverzüglich
nach
Feststellung des Jahres- und/oder
Konzernabschlusses, jedoch in keinem
Fall später als sechs Monate nach dem
Ende des jeweiligen Geschäftsjahres
kostenfrei eine Abschrift des Jahresund/oder Konzernabschlusses nebst
Lage- und/oder Konzernlagebericht
sowie den Bericht des Abschlussprüfers
über die Prüfung des Jahres- und/oder
Konzernabschlusses sowie des Lageund/oder
Konzernlageberichtes
zu
übersenden.
11.1
The Issuer shall send the Creditor, free of
charge and without undue delay, upon
approval of the unconsolidated and/or
consolidated annual financial statements,
however, in no event later than six
months after the end of the respective
fiscal year, a copy of such annual
financial statements together with the
management report of the Issuer and/or
the group as well as the auditor's report on
the audit of the unconsolidated and/or
consolidated annual financial statements
as well as the management report of the
Issuer and/ or the group.
11.2
Enthält der Bestätigungsvermerk des
Abschlussprüfers zum Jahres- und/oder
Konzernabschluss
Einschränkungen,
wird der Bestätigungsvermerk versagt
oder bestehen sonst begründete Zweifel
an
der
Ordnungsmäßigkeit
der
Buchführung, so ist die Gläubigerin
berechtigt, den Jahres- und/oder den
Konzernabschluss auf Kosten der
Emittentin prüfen zu lassen.
11.2
In the event that the audit certificate is
refused, or contains restrictions in relation
to the unconsolidated and/or consolidated
annual financial statements or in the event
that there are otherwise reasonable doubts
as to the compliance with accounting
principles, the Creditor shall be entitled at
the Issuer's expense to arrange for an
examination of the unconsolidated and /
or
consolidated
annual
financial
statements at the Issuer's expense.
11.3
Die Gläubigerin ist von der Emittentin
ohne
gesonderte
Aufforderung
unverzüglich über solche Ereignisse zu
informieren, die von wesentlicher
Bedeutung für die Rechtsstellung oder
das wirtschaftliche Interesse der
Gläubigerin sein könnten. Insbesondere
ist die Emittentin verpflichtet, die
Gläubigerin
unverzüglich
zu
informieren, wenn sie davon Kenntnis
erhält, dass ein Umstand gemäß Ziffer 0
(a) bis (j) bevorsteht oder eingetreten ist,
insbesondere ein Kontrollwechsel über
die Emittentin im Sinne von Ziffer 0.
11.3
The Issuer shall inform the Creditor
without undue delay and without any
special request, of any special events
which could be of material relevance to
the legal status or the economic interests
of the Creditor. In particular, the Issuer
shall inform the Creditor without undue
delay if it has knowledge of a situation
pursuant to clause 9.1 (a) to (j) being
imminent or having arisen, particularly a
change of control over the Issuer pursuant
to clause 9.1 (c).
11.4
Die vorgenannten Informationsrechte der
Gläubigerin werden durch eine oder
11.4
The
Creditor's
aforementioned
information rights shall be exercised by
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12.1
mehrere
zur
Verschwiegenheit
verpflichteten Personen ausgeübt (der
"Monitoring Agent"). Der Monitoring
Agent
ist
berechtigt,
die
Informationsrechte seinerseits durch zur
Verschwiegenheit verpflichtete Personen
auszuüben.
one or several persons under an obligation
to
maintain
confidentiality
(the
"Monitoring Agent"). The Monitoring
Agent shall be entitled to exercise the
information rights by using persons under
an obligation to maintain confidentiality.
§ 12
ZUSÄTZLICHE
INFORMATIONSRECHTE BEI
BONITÄTSVERSCHLECHTERUNG
ODER BEI
ZAHLUNGSRÜCKSTAND
§ 12
Additional Information Rights in the
Event of Deterioration of
Creditworthiness or Payment Default
Wenn
die
Bilanzbeurteilung
der
Emittentin nach Moody's KMV RiskCalc
gemäß Ziffer 0 Baa3.edf für zwei
aufeinanderfolgende
Geschäftsjahre
unterschritten hat, ist die Emittentin zur
Sicherstellung der finanziellen Interessen
der Gläubigerin verpflichtet, ihre
operative Planung für das bei der
Bekanntgabe
der
zweiten
Unterschreitung von Baa3.edf laufende
und
das
folgende
Geschäftsjahr
vorzulegen.
12.1
Die
operative
Planung
ist
als
Fortschreibung der operativen Planung
der Emittentin für die Vorjahre
darzustellen. Die operative Planung muss
die geplante Entwicklung der Emittentin
ausführlich beschreiben. Die Gläubigerin
kann die operative Planung dem
Recovery Manager im Sinne von 0 zur
Durchsicht übersenden und diesen mit
der Überprüfung der operativen Planung
sowie deren Diskussion mit der
Emittentin beauftragen. Angemessene
Kosten, die im Rahmen vorgenannter
Maßnahmen bei der Gläubigerin und von
ihr beauftragten Dritten entstehen, sind
bis zu einem Betrag von EUR 7.500,durch die Emittentin zu tragen.
12.2
Des weiteren stehen der Gläubigerin zur
Wahrung ihrer finanziellen Interessen die
nachfolgend aufgeführten Rechte zu
bzw. treffen die Emittentin nachfolgend
aufgeführte Pflichten, falls (i) die
Emittentin der Verpflichtung zur
Zahlung
des
Zinses
an
zwei
The operative planning should be
provided on a go and concern basis based
on the operative planning of the Issuer for
the previous business years. The operative
planning shall describe the intended
development of the Issuer in detail. The
Issuer may instruct the recovery manager
within the meaning of Section 12.2 (d) to
review the operative planning and to
discuss it with the Issuer. For these
purposes the Creditor may send the
operative planning to the recovery
manager. Reasonable costs of the Creditor
and any third parties instructed by the
Creditor caused by the aforementioned
actions shall be borne up to an amount of
EUR 7.500 by the Issuer.
12.2
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To safeguard the financial interests of the
Creditor the Issuer shall provide his
operative planning provided that the
Assessment of Financial Statements
pursuant to clause 6 falls short of
Baa3.edf for two subsequent business
years. The Issuer shall provide the
operative planning for that business year
in which the notification of the second
shortfall under Baa3.edf is falling and for
the subsequent business year.
In addition, to safeguard its financial
interests, the Creditor shall be entitled to
the rights specified hereinafter and the
Issuer shall have the duties specified
hereinafter in the event that (i) the Issuer
fails to fulfil its payment obligation of the
Interest on two consecutive Payment
12.3
aufeinanderfolgenden Zahlungsterminen
gemäß Ziffer 0 nicht vollständig
nachgekommen ist, (ii) der Gesamtbetrag
der Zahlungen auf den Zins, mit dem
sich die Gesellschaft in Verzug befindet,
den
Betrag
des
für
2
Dreimonatszeiträume zahlbaren Zinses
erreicht oder übersteigt, oder (iii) die
Bilanzbeurteilung der Emittentin nach
Ziffer 0 auf B1.edf oder darunter absinkt.
Der Gläubigerin stehen die zusätzlichen
Rechte gemäß (a) und (b) zu und die
Emittentin treffen die Pflichten gemäß
(c) und (d), solange der Zahlungsverzug
nicht vollständig behoben ist.
Dates pursuant to clause 5.2, (ii) the total
amount of outstanding payments on the
Interest has attained or exceeded the
amount of the Interest payable for two
three month periods, or (iii) the Financial
Statement Assessment pursuant to clause
6.1 of the Issuer is lowered to a B1.edf or
below. The Creditor is entitled to the
additional rights pursuant to (a) and (b)
and the Issuer shall have the duties
pursuant to (c) and (d), unless the default
in payment has been fully remedied.
(a)
Die Gläubigerin ist berechtigt, sich
über alle wesentlichen Geschäfte
und Verträge der Emittentin zu
informieren. Die Emittentin ist
verpflichtet, der Gläubigerin auf
Verlangen alle diesbezüglichen
Informationen bereitzustellen.
(a)
The Creditor is entitled to inform
itself of all material transactions
and contracts of the Issuer. The
Issuer shall provide the Creditor,
upon request, with all information
in respect thereof.
(b)
Auf Verlangen der Gläubigerin
wird die Geschäftsführung der
Emittentin monatlich einen Bericht
über
alle
wesentlichen
Entwicklungen erstatten und ihr
ermöglichen, den Bericht durch
Einsicht in die Bücher und
Schriften der Emittentin zu
überprüfen.
(b)
Upon the request of the Creditor,
the management of the Issuer shall
provide it with a report on a
monthly basis on all material
developments and enable it to
review the report by inspection of
the
Issuer's
accounts
and
documents.
(c)
Bevor
die
Emittentin
mit
Kapitalgebern, die noch nicht an
der Emittentin mit Eigen- oder
Fremdkapital
beteiligt
sind,
Gespräche über die Sanierung der
Emittentin führt, wird sie solche
Gespräche zunächst mit dem
Monitoring Agent führen.
(c)
The Issuer shall conduct any talks
regarding the capital reconstruction
of the Issuer with the Monitoring
Agent before conducting such talks
with investors, who do not yet have
equity or debt capital in the Issuer.
(d) Die Emittentin verpflichtet sich,
mit einem durch die Gläubigerin
bestellten Recovery Manager einen
eintägigen
Workshop
durchzuführen. Im Rahmen dieses
Workshops wird ein Turnaround
Plan für die Emittentin erarbeitet.
(d)
The Issuer shall conduct a one-day
workshop with a recovery manager
appointed by the Creditor. In the
course of that workshop, a
turnaround plan for the Issuer shall
be devised.
Angemessene Kosten, die durch die
Maßnahmen gemäß Ziffer 0 bis (c) bei
12.3
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Any reasonable costs incurred by the
Creditor and/or any of its authorised third
der Gläubigerin und von ihr beauftragten
Dritten entstehen, sind von der
Emittentin
unverzüglich
nach
Rechnungslegung zu erstatten. Die
Kosten, die im Rahmen von Maßnahmen
nach Ziffer 0 entstehen, sind bis zu
einem
Betrag
von
EUR 5000,unverzüglich nach Rechnungslegung
durch die Emittentin zu tragen.
12.4
Die
vorgenannten
zusätzlichen
Informationsrechte der Gläubigerin
werden durch den Monitoring Agent
wahrgenommen.
parties, as a result of the measures
pursuant to clause 12.2 (a) to (c), are to be
reimbursed by the Issuer without undue
delay after receiving the cost statement.
The costs which arise within the
framework of measures pursuant to clause
12.2 (d), shall be borne by the Issuer in an
amount of up to EUR 5.000 without
undue delay after receiving the cost
statement.
12.4
§ 13
RANGRÜCKTRITT
13.1
Die Gläubigerin tritt nach Maßgabe der
Ziffer 0 mit ihrem Anspruch auf
Rückzahlung des Nominalbetrages und
ihrem Anspruch auf Zinszahlung nach
dieser Vereinbarung dergestalt im Rang
hinter die Forderungen aller bestehenden
und künftigen Gläubiger der Emittentin
(jeweils ein "Vorrangiger Gläubiger")
zurück, dass sie erst nach Befriedigung
sämtlicher Gesellschaftsgläubiger und,
soweit ein Liquidationsüberschuss oder
ein die sonstigen Verbindlichkeiten
übersteigendes
Vermögen
der
Gesellschaft hierfür zur Verfügung steht,
nur zugleich mit, im Rang jedoch vor
den Einlagerückgewähransprüchen der
Gesellschafter der Emittentin Erfüllung
dieser Ansprüche verlangen kann. Der
Nachrang
gilt
auch
im
Insolvenzverfahren.
13.2
Der in Ziffer 0 erklärte Rangrücktritt gilt
nur, solange und soweit durch eine
teilweise oder vollständige Befriedigung
des
im
Rang
zurückgetretenen
Anspruchs
der
Gläubigerin
eine
Überschuldung
oder
eine
Zahlungsunfähigkeit
im
insolvenzrechtlichen
Sinne
der
Emittentin entsteht oder zu entstehen
droht.
13.3
Vorbehaltlich des Rangrücktritts nach
Ziffer 0 bleibt die Gleichrangigkeit der
§ 13
Subordination
13.1
The Creditor hereby subordinates its
claim to the repayment of the Nominal
Amount and its claim to receive Interest
payments arising under clause 13.2 of this
agreement to the claims of all existing and
future creditors of the Issuer (each a
"Senior Creditor") in such manner that a
repayment can only be claimed after the
satisfaction of all other creditors of the
Issuer and, provided that a liquidation
surplus or other assets exceeding the other
liabilities of the Issuer are available to the
Issuer for such repayment. The Creditor
shall be entitled to claim repayment at the
same time but ranking prior to claims to
refunds of capital contributions of the
shareholders of the Issuer. This
subordination also applies for insolvency
proceedings.
The subordination specified in clause 13.1
shall only apply if, and to the extent that
over-indebtedness of the Issuer or his
illiquidity in accordance with the
provisions of the German insolvency law
would arise or be imminent as a result of
a partial or full satisfaction of the
subordinated claim of the Creditor.
13.3
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The
aforementioned
additional
information rights of the Creditor shall be
exercised by the Monitoring Agent.
Subject to the subordination pursuant to
13.1, the pari passu ranking of the
Forderungen der Gläubigerin mit den
Forderungen
anderer
im
Rang
entsprechend zurückgetretener Gläubiger
von dieser Vereinbarung unberührt.
13.4
Die Emittentin versichert, dass ihre
Gesellschafter für ihre derzeitigen
eigenkapitalersetzenden
Forderungen
ausdrücklich den Rücktritt im Range
nach den Ansprüchen der Gläubigerin
erklärt haben und auf eine vorrangige
Befriedigung
im
Rang
von
§ 39 Abs. 1 Nr. 5 InsO verzichten. Die
Emittentin verpflichtet sich zudem
zukünftige
Leistungen
der
Gesellschafter, die in einer Krise der
Gesellschaft eigenkapitalersetzend sein
und unter § 39 Abs. 1 Nr. 5 InsO fallen
können, nur unter der Voraussetzung zu
akzeptieren, dass die Gesellschafter mit
ihren daraus entstehenden Forderungen
gegenüber der Emittentin ebenfalls
ausdrücklich den Rücktritt im Range
nach den Ansprüchen der Gläubigerin
erklären und auf eine vorrangige
Befriedigung
im
Rang
von
§ 39 Abs. 1 Nr. 5 InsO verzichten.
Creditor's claims along with the claims of
other subordinated creditors which do
rank pari passu, shall remain unaffected
by this agreement.
13.4
§ 14
ABTRETUNG VON RECHTEN AUS
DIESER VEREINBARUNG
The Issuer ensures that its shareholders
have expressly declared subordination in
relation to their current and equity capital
substituting claims behind the claims of
Creditor and have waived their right to
prior-ranking satisfaction pursuant to Sec.
39 Para 1 No. 5 of the German Insolvency
Code (InsO). In addition, the Issuer
undertakes to receive future payments of
its shareholders, which could be
considered substitute for equity capital
when the Issuer is in a crisis and which
may come under Sec. 39 Para 1 No. 5 of
the German Insolvency Code, only if the
shareholders likewise expressly declare
subordination of their claims arising there
under behind the claims of the Creditor
and waive their right to prior-ranking
satisfaction pursuant to Sec. 39 Para 1 No.
5 of the German Insolvency Code.
§ 14
Assignment of rights under this
Agreement
14.1
Die Emittentin ist nicht berechtigt, ihre
Ansprüche oder sonstige Rechte aus
dieser Vereinbarung ohne Zustimmung
der Gläubigerin an Dritte zu übertragen,
zu verpfänden oder in sonstiger Weise zu
belasten.
14.1
The Issuer is prohibited from assigning,
pledging or encumbering in any way its
claims or other rights under this
agreement to third parties without the
prior consent of the Creditor.
14.2
Die Gläubigerin ist berechtigt, ihre aus
dieser
Vereinbarung
resultierenden
Ansprüche auf Zahlung von Geld durch
die Emittentin zu verkaufen und/oder
abzutreten oder Sicherheiten daran zu
bestellen,
insbesondere
im
Zusammenhang mit der Refinanzierung
des Genussrechts.
14.2
The Creditor shall be entitled to sell
and/or assign its claims to any payment of
money by the Issuer under this agreement
and/or grant securities over any such
claims, in particular in connection with
the refinancing of the Participation Right.
14.3
Die Gläubigerin ist darüber hinaus
berechtigt,
mit
Zustimmung
der
Emittentin ihre Rechtsstellung aus dieser
Vereinbarung mit allen Rechten und
Pflichten ganz oder teilweise auf einen
14.3
The Creditor, with the prior consent of the
Issuer, shall further be entitled to assign
its legal status under this agreement in full
or in part, together with all rights and
duties to a third party ("Assumption of
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Dritten
zu
übertragen
(die
"Vertragsübernahme"). Die Emittentin
erteilt bereits jetzt unwiderruflich ihre
Zustimmung
zu
einer
Vertragsübernahme auf einen durch die
Gläubigerin zu benennenden Dritten für
den Fall, dass
Agreement"). The Issuer hereby gives its
irrevocable consent to an assignment of
the Participation Right to a third party to
be appointed by the Creditor, in the event
that
(a)
die Gläubigerin innerhalb von 20
Geschäftstagen
nach
dem
Anfangsdatum
diesen
Dritten
benennt oder
(a)
the Creditor appoints that third
party within 20 business days of
the Commencement Date or
(b)
die in Ziffern 0 (i) oder 0 (ii)
bezeichneten
Bedingungen
eingetreten sind.
(b)
the conditions specified in clauses
12.2 (i) or 12.2 (ii) have been
fulfilled.
§ 15
ZUSICHERUNG UND
VERPFLICHTUNGEN DER
EMITTENTIN
§ 15
Issuer's Representation and Covenants
15.1
Die Emittentin sichert zu, dass ihr
Geschäftsbetrieb
und
ihre
Vermögensgegenstände nach Art und
Umfang branchenüblich ausreichend
versichert sind. Auf Verlangen ist dies
der Gläubigerin nachzuweisen.
15.1
The Issuer represents that its business
undertaking and its assets are sufficiently
insured to the extent and in the manner
that is usual in that line of business. The
Issuer shall provide evidence thereof to
the Creditor upon request.
15.2
Die Emittentin verpflichtet sich, der
Gläubigerin die von Zinsen einbehaltene
Kapitalertragsteuer in einer dem jeweils
geltenden
Recht
entsprechenden
Steuerbescheinigung unverzüglich nach
Zinszahlung zu bescheinigen.
15.2
The Issuer shall be obliged to issue
without undue delay after the Interest
payment a withholding tax certificate
being in accordance with the current tax
law to the Creditor
§ 16
VERWENDUNG DES
NOMINALBETRAGES
§ 16
Appropriation of the Nominal Amount
Die Emittentin wird den Nominalbetrag
für Zwecke des Geschäftsbetriebes der
Emittentin nach eigenem Ermessen
verwenden.
Dabei
darf
der
Nominalbetrag
The Issuer shall, at its sole discretion use
the Nominal Amount for business
purposes of the Issuer. In that respect, the
Nominal Amount may:
(a)
insbesondere
zur
anderer Kapitalgeber;
Ablösung
(a)
be used, in particular, for the
discharge of other creditors;
(b)
zur
Ablösung
von
eigenkapitalersetzenden Darlehen
der Gesellschafter bzw. diesen
nahe stehenden Personen i.S.d.
§ 1 Abs. 2
AStG
oder
(b)
be used for the repayment of equity
capital substituting loans by
shareholders or by related persons
substituting equity capital pursuant
to Sec. 1 Para 2 of the German
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gleichgestellten Forderungen nur
mit Zustimmung der Gläubigerin;
sowie
(c)
nicht zur Rückzahlung
Eigenkapital
Foreign Tax Relations Act (AStG)
or coequal claims, only with the
prior consent of the Creditor, and
von
(c)
not be used for repayment of equity
capital.
verwendet werden.
§ 17
AUSGABE WEITERER
FINANZIERUNGSINSTRUMENTE
DURCH DIE EMITTENTIN /
VERWÄSSERUNGSSCHUTZ
§ 17
Issuance of Additional Financing
Instruments by the Issuer / Dilution
Protection
Finanzierungsinstrumente
mit
gewinnabhängiger
oder
gewinnorientierter Vergütung sowie in
der Insolvenz der Emittentin nachrangige
Finanzierungsinstrumente, insbesondere
Genussrechte,
stille
Gesellschaftsverhältnisse,
partiarische
Darlehen, Wandelschuldverschreibungen
und
Optionsschuldverschreibungen
dürfen,
Additional financing instruments with
profit-related
or
profit-oriented
remuneration as well as financing
instruments which would be subordinated
in the event of the insolvency of the
Issuer, in particular, profit participation
rights, silent partnerships, loans with
profit participation, convertible bonds and
warrant-linked bonds may be issued by
the Issuer:
(a)
sofern sie vorrangig vor den
Ansprüchen
aus
diesem
Genussrecht zu bedienen wären,
von
der
Emittentin
nur
ausgegeben werden, soweit die
Gläubigerin dem zuvor schriftlich
zugestimmt hat;
(a)
provided that such financing
instruments would rank senior to
claims under this Participation
Right only with prior written
consent of the Creditor;
(b)
sofern sie gleichrangig mit oder
nachrangig gegenüber Ansprüchen
aus diesem Genussrecht zu
bedienen wären, ohne vorherige
Zustimmung der Gläubigerin
ausgegeben
werden.
Die
Gläubigerin ist in diesem Fall
jedoch von der Aufnahme des
gleichrangigen oder nachrangigen
Kapitals unverzüglich schriftlich
zu
informieren.
Die
Informationspflicht betrifft die
wesentlichen Regelungen des
jeweiligen
Finanzierungsinstruments
(insbesondere Volumen, Laufzeit,
Art,
Vergütung,
Verwässerungsschutzbedingunge)
sowie den vollständigen Wortlaut
(b)
provided that they rank junior or
pari passu to claims under this
Participation Right, without the
prior consent of the Creditor. The
Issuer shall notify the Creditor in
such case without undue delay on
the receipt of the capital ranking
junior or pari passu to claims to the
Participation
Rights.
The
notification shall include the key
terms of the respective financing
documentation (especially amount,
term, legal type, remuneration,
dilution protection) and the full
wording of the subordination
provisions.
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der Nachrangklausel.
§ 18
SCHLUSSBESTIMMUNGEN
§ 18
Final Provisions
18.1
Änderungen und Ergänzungen dieser
Vereinbarung
bedürfen
zu
ihrer
Wirksamkeit der Schriftform, dies gilt
auch für die Änderung dieser
Schriftformklausel.
18.1
In order to be effective any amendments
and supplements to this agreement must
be in writing. This applies also to a
waiver of this written form requirement.
18.2
Sollte
eine
Bestimmung
dieser
Vereinbarung unwirksam sein oder sollte
diese
Vereinbarung
eine
Lücke
enthalten, wird die Gültigkeit der übrigen
Bestimmungen hierdurch nicht berührt.
In einem solchen Fall sollen die
unwirksamen Bestimmungen durch
Bestimmungen ersetzt werden, die dem
Sinn und Zweck der unwirksamen
Bestimmungen entsprechen. Im Falle
von Lücken in dieser Vereinbarung soll
eine Bestimmung vereinbart werden, die
dem Sinn und der Absicht dieser
Vereinbarung entspricht und auf die die
Parteien dieser Vereinbarung sich
geeinigt hätten, falls das Problem von
Anfang an bedacht worden wäre.
18.2
Should any of the provisions of this
agreement be ineffective, or should there
be a gap in this agreement, the validity of
the remaining provisions hereof shall not
be affected thereby. In lieu of such
ineffective provision, an effective
provision which comes closest to the
intent and purpose of the ineffective
provision shall be deemed to have been
agreed. In the event of a gap, a provision
which corresponds to the intent and
purpose of this agreement had the
contractual parties taken the matter into
consideration at the outset shall be
deemed to have been agreed.
18.3
Erfüllungsort ist Düsseldorf.
18.3
The place of performance is Düsseldorf.
18.4
Gerichtsstand
für
Rechtsstreitigkeiten
aus
Vereinbarung ist Düsseldorf.
sämtliche
dieser
18.4
The place of jurisdiction for any disputes
arising out of this agreement is
Düsseldorf.
18.5
Auf
diese
Vereinbarung
findet
ausschließlich deutsches Recht mit
Ausnahme der Bestimmungen des
deutschen internationalen Privatrechts
Anwendung.
18.5
This agreement shall be governed by and
construed in accordance with the laws of
the Federal Republic of Germany with the
exception of the provisions of German
private international law.
18.6
Die Emittentin und die Gläubigerin
verpflichten sich, Ziffer 0 nicht zulasten
der Vorrangigen Gläubiger ohne deren
vorherige Zustimmung zu ändern. Dies
gilt auch dann, wenn Dritte weitere
Finanzierungsinstrumente im Sinne von
Ziffer 0 erwerben.
18.6
The Issuer and the Creditor undertake not
to modify provisions in respect of the
issuance
of
additional
financing
instruments pursuant to clause 17 to the
Senior Creditors' detriment, without the
consent of these creditors. This shall also
apply, if additional financing instruments
within the meaning of clause 17 are
issued to any third party.
18.7
Die Gesellschafter der Emittentin sowie
dieser nahestehende Personen im Sinne
des § 1 Abs. 2 AStG und/oder
18.7
The shareholders of the Issuer as well as
related persons within the meaning of
Sec. 1 Para 2 of the German Foreign Tax
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Angehörige im Sinne von § 15 AO
(einschließlich deren Rechtsnachfolger)
sind weder rechtlich noch tatsächlich
verpflichtet,
für
die
Zahlungsverpflichtungen der Emittentin
aus dieser Vereinbarung einzustehen.
Act and/or relatives within the meaning of
Para 15 of the German Tax Code (AO)
(including their legal successors) are not
obliged either in fact or law to be liable
for the payment obligations of the Issuer
under this agreement.
18.8
Soweit
Bestimmungen
in
dieser
Vereinbarung die Zahlung pauschalierten
Schadensersatzes
vorsehen,
wird
vorbehaltlich der Regelung in Ziffer 5.4
der jeweils zur Zahlung dieses
Schadensersatzes verpflichteten Partei
der Nachweis eines niedrigeren oder der
jeweils zum Schadensersatz berechtigten
Partei der Nachweis eines höheren
Schadens nicht abgeschnitten.
18.8
Where provisions in this agreement
provide for the payment of liquidated
damages, the party obliged to pay those
damages or the party entitled to claim
those damages shall, subject to the
provisions in clause 5.3 and clause 6.8 of
this agreement, not be precluded from
proving that the damage is lower or
higher, respectively.
18.9
Soweit diese Vereinbarung nicht
ausdrücklich etwas anderes bestimmt,
werden alle Steuern, Gebühren, Abgaben
und sonstige Kosten, die aus dieser
Vereinbarung,
insbesondere
ihrem
Abschluß und ihrer Durchführung oder
einer Vertragsübernahme, entstehen, von
der Emittentin getragen.
18.9
Unless this agreement expressly provides
otherwise, all taxes, charges, duties and
other costs which are incurred under this
agreement, in particular, as regards its
conclusion and its implementation or an
Assumption of the agreement, shall be
borne by the Issuer.
18.10
Sämtliche Zahlungen, die im Rahmen
dieser Vereinbarung von der Emittentin
an die Gläubigerin erfolgen, sind auf die
als
Anlage 18.10
angefügte
Kontoverbindung
zu
überweisen.
Änderungen dieser Kontoverbindung
werden der Emittentin unverzüglich
schriftlich mitgeteilt. Die Mitteilung der
Änderung
der
Kontoverbindung
aufgrund einer Vertragsübernahme nach
Ziffer 0 erfolgt schriftlich mit der
Benachrichtigung
über
die
Vertragsübernahme.
18.10
Any payment to the Creditor pursuant to
this agreement shall be made to the bank
account specified in Attachment 18.10
and the Issuer shall notify the Creditor
regarding any changes of this bank
account without undue delay in writing.
In case of an assumption of the agreement
pursuant to clause 14.3 the Issuer shall be
notified regarding any changes of the
bank account of the Creditor in writing
and together with notification regarding
the assumption of agreement.
18.11
Fällt eine Zahlungsverpflichtung nach
dieser Vereinbarung, insbesondere die
Pflicht zur Zinszahlung nach Ziffer 0 und
die Pflicht zur Rückzahlung des
Nominalbetrages nach Ziffer 0 auf einen
Tag, der kein Geschäftstag ist, so
verschiebt sich die jeweilige Fälligkeit
auf den darauf folgenden Geschäftstag.
18.11
In the event that any Payment Date under
this agreement, especially the payment
dates for the Interest pursuant to clause
5.2 and the Due Date pursuant to clause
10.1 does not fall on a Business Day, the
respective due date shall be postponed to
the next following Business Day.
18.12
Sofern der Schriftverkehr zwischen
Emittentin und Gläubigerin einen
Fristlauf auslöst, ist als Anfang der Frist
18.12
In the event that any correspondence in
writing between the Issuer and the
Creditor shall be decisive for the start of
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der Zugang maßgeblich, es sei denn, in
dieser Vereinbarung wurde hiervon
abweichend eine Regelung getroffen.
any term under this agreement, then the
receipt shall be decisive for the start of the
term, provided that this agreement
provides for any different provision
therefore.
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Terms and Conditions of the Subordinated Loan Agreements
Set forth below are the terms and conditions of the Subordinated Loan Agreements which have been
entered into by the Portfolio Companies. To the extent that there are material deviations from the
provisions set out below that have been agreed with individual Portfolio Companies, these are set out
under "The Portfolio Companies – Individual Portfolio Company Information".
THE GERMAN TEXT OF THE SUBORDINATED LOAN AGREEMENT IS LEGALLY BINDING.
THE ENGLISH TRANSLATION IS FOR CONVENIENCE ONLY.
Angebot zum Abschluss eines nachrangigen
Darlehens zwischen
Offer for Conclusion of a Subordinated Loan
Agreement between
[Schuldnerin]
[Borrower]
[Address]
(hereinafter referred to as "Borrower")
und
and
[Gläubigerin]
[Company name]
[Address]
(hereinafter referred to as "Creditor")
§1
EINRÄUMUNG EINES
NACHRANGIGEN DARLEHENS
§1
Entering into a Subordinated Loan
Agreement
1.1
Die Schuldnerin bietet der Gläubigerin
hiermit unwiderruflich an, bei dieser
nach Maßgabe der nachfolgenden
Bestimmungen
ein
nachrangiges
Darlehen (das "Darlehen") im Betrag
von höchstens EUR [Betrag] (in Worten:
Euro [Betrag in Worten]) (der
"Höchstnominalbetrag")
und
mindestens EUR [Betrag] (in Worten:
Euro [Betrag in Worten]) (der
"Mindestnominalbetrag") aufzunehmen
(das "Angebot"). Die Gläubigerin
bestimmt, in den Grenzen zwischen
Mindestnominalbetrag
und
Höchstnominalbetrag,
in
welchem
Nominalbetrag (der "Nominalbetrag")
das Darlehen aufgenommen wird. Den
Nominalbetrag teilt die Gläubigerin der
Schuldnerin durch Übersendung der als
Anlage 1.1 beigefügten Notice mit. Die
als Anlage 1.1 beigefügte Notice ist
zusammen mit dem unterzeichneten
Angebot der Schuldnerin zu übersenden.
Auf den Nominalbetrag entsteht ein
[Disagio] von [4%].
1.1
The Borrower hereby irrevocably offers
to enter into a subordinated loan
agreement (the "Loan") in an amount of
up to EUR [amount] (in words: [amount
in words] Euros) (the "Maximum
Nominal Amount") and not less than
EUR [amount] (in words: [amount in
words] Euros) (the "Minimum Nominal
Amount") (the "Offer") in accordance
with the following provisions (the
"Agreement"). The Creditor determines,
limited by the Minimum Nominal
Amount and the Maximum Nominal
Amount, in which Nominal Amount (the
"Nominal Amount") the Loan is granted.
The Creditor informs the Borrower
regarding the Nominal Amount by
sending over the Notice attached as
Attachment 1.1 to the Borrower. The
Notice attached as Attachment 1.1 should
be sent to the Borrower together with a
signed copy of this Agreement. There will
be a [discount] in the amount of [4 per
cent] of the Nominal Amount.
1.2
Die Gläubigerin kann das Angebot nur
innerhalb eines Zeitraumes von [drei]
Monaten ab Zugang dieses Angebots
annehmen. Mit fristgerechter Absendung
1.2
The Creditor may only accept the Offer
within a period of [three] months after
receipt of this Offer. The sending of the
undersigned Offer and the Notice attached
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des unterzeichneten Angebots und der
als Anlage 1.1 beigefügten Notice gilt
das Angebot als angenommen (die
"Angebotsannahme").
Mit
Angebotsannahme wird das Darlehen an
die Schuldnerin gewährt.. Der Tag der
Angebotsannahme wird nachfolgend als
"Anfangsdatum" bezeichnet.
1.3
Die Anweisung des Nominalbetrages auf
das
Konto
der
Schuldnerin
[Unternehmen]
[Bankverbindung]
abzüglich des Disagios ist drei
Geschäftstage nach Angebotsannahme
fällig. Die Schuldnerin hat den Tag der
Wertstellung des Nominalbetrages auf
ihrem
Konto
der
Gläubigerin
unverzüglich schriftlich mitzuteilen.
"Geschäftstag"
im
Sinne
dieser
Vereinbarung ist jeder Tag (mit
Ausnahme von Samstag und Sonntag),
an dem das Trans-European Automated
Real-Time Gross Settlement Express
Transfer System (TARGET) oder sein
Nachfolgesystem Zahlungen in Euro
abwickelt. Zahlungen in Euro abwickelt.
as Attachment 1.1 within the prescribed
time limit is considered as binding
acceptance of the Offer (the "Acceptance
of the Offer"). Upon Acceptance of the
Offer the Loan is granted in favour of the
Borrower. The date of the Acceptance of
the Offer is hereinafter referred to as the
"Commencement Date".
1.3
The transfer of the Nominal Amount less
the discount to the bank account of the
Borrower [company] [bank account] shall
be due within three Business Days after
the Acceptance of the Offer. The
Borrower shall notify the Creditor without
undue delay in writing the value date of
the Nominal Amount on its account (the
"Value Date"). "Business Day" for the
purposes of this Agreement shall be any
day (with the exception of Saturday and
Sunday) on which the Trans-European
Automated Real-Time Gross Settlement
Express Transfer System (TARGET) or
its successor system settles payments in
Euros.
§2
BERECHTIGUNG
§2
Entitlement
Die Schuldnerin garantiert im Wege
einer selbständigen Garantie, dass die
Voraussetzungen für eine wirksame
Aufnahme des Darlehens vorgelegen
haben, die Aufnahme durch die
zuständigen Organe der Schuldnerin
autorisiert ist und dass etwaige
Bezugsrechte
der
Aktionäre
der
Schuldnerin wirksam ausgeschlossen
wurden. Ein Nachweis der Autorisierung
durch die zuständigen Organe ist dieser
Vereinbarung als Anhang beigefügt.
The Borrower hereby guarantees by way
of an independent guarantee, that the
prerequisites to borrow the Loan are
fulfilled, that the competent corporate
bodies of the Borrower authorised the
borrowing of the Loan and that
subscription rights (if any) of the
shareholders of the Borrower were
effectively excluded. A verification of the
authorisation by the competent corporate
bodies is attached to this Agreement.
§3
RECHTSSTELLUNG DER
GLÄUBIGERIN
§3
Legal Status of the Creditor
3.1
Durch diese Vereinbarung wird kein
Gesellschaftsverhältnis zwischen der
Schuldnerin und der Gläubigerin
begründet.
3.1
No partnership whatsoever shall be
constituted between the Borrower and the
Creditor as a result of this Agreement.
3.2
Das
Darlehen
gewährt
auf
schuldrechtlicher
Grundlage
Gläubigerrechte,
jedoch
keine
Aktionärsrechte an der Schuldnerin,
insbesondere
keine
Teilnahme-,
Mitwirkungs- und Stimmrechte in den
Hauptversammlungen oder Bezugsrechte
3.2
The Loan grants creditor rights to the
Creditor on the basis of the German law
of obligations. It does not grant any
shareholder rights in the Borrower, in
particular, no rights of attendance,
participation and voting rights at the
shareholders' meetings or rights at
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5.1
auf neue Anteile. Der Gläubigerin steht
kein Weisungsrecht gegenüber der
Unternehmensleitung der Schuldnerin
zu.
subscribe to newly issued shares. The
Creditor shall not be entitled to issue
instructions to the management of the
Borrower.
§4
BETEILIGUNG AM ERLÖS DER
LIQUIDATION
§4
Participation in the Proceeds of the
Liquidation
Das Darlehen gewährt keinen Anteil am
Liquidationserlös.
The Loan shall not grant any share in
liquidation proceeds.
§5
VERZINSUNG
§5
Interest
Zins
5.1
Die Gläubigerin erhält als Gegenleistung
für
die
Bereitstellung
des
Nominalbetrages vom Anfangsdatum
(einschließlich) bis zum Fälligkeitstag
i.S.v. Ziffer 10.1 von der Schuldnerin
eine feste Verzinsung in Höhe des
Sieben-Jahres-EUR-Swapsatz
Brief
zuzüglich 450 Basispunkte p.a berechnet
auf den Nominalbetrag (der "Zins"). Der
Sieben-Jahres-EUR-Swapsatz Brief (der
"Sieben-Jahres-EUR-Swapsatz Brief")
ist der am Anfangsdatum um 11:00 MEZ
auf der Referenzseite "ISDAFIX2" des
Reuters Services Informationssystems
veröffentlichte
Sieben-Jahres-EURSwapsatz auf EURIBOR Basis. Wird das
Reuters Services Informationssystem
ersetzt
oder
ändert
sich
die
Referenzseite, so ist die Nennung auf der
entsprechenden
Nachfolgeseite
maßgeblich. Der Zins wird auch dann
gewährt, wenn der Jahresabschluss der
Schuldnerin
keinen
ausreichenden
Jahresüberschuss ausweist.
5.2
Fälligkeit des Zinses
The Creditor shall receive a fixed rate of
interest on the Nominal Amount of [ ]
basis points above the seven-year EUR
swap offer rate in consideration for
providing the Nominal Amount from (and
including) the Commencement Date up to
(and excluding) the Due Date within the
meaning of clause 10.1 (the "Interest").
The seven-year swap offer rate (the
"Seven-Year Swap Offer Rate") shall be
defined as the seven-year swap rate
calculated on the basis of EURIBOR, as
displayed on the Reuters services
information system page "ISDAFIX2" at
11 am CET on the Commencement Date.
In the event that the Reuters services
information system is being replaced or in
the event that the reference page is being
changed, the information on the successor
page will be applicable. The Interest shall
also be granted, if the non-consolidated
annual financial statements of the
Borrower does not reveal sufficient
annual surplus in a fiscal year.
5.2
Der Zins ist am 20. März, 20. Juni, 20.
September und 20. Dezember eines jeden
Kalenderjahres
(jeweils
ein
"Zahlungstermin") für das jeweils zum
Ende des betreffenden Kalendermonates
endende Kalenderquartal pro rata
temporis gemäß Ziffer 5.3 fällig und
zahlbar. Fällt das Anfangsdatum nicht
auf den ersten Kalendertag eines
Quartals, so wird der Zins für das
unvollständige Quartal pro rata temporis
gemäß Ziffer 5.3 berechnet. Fällt der
Fälligkeitstag gemäß Ziffer 10.1 nicht
auf den letzten Kalendertag eines
Quartals, so ist auch der Zins für dieses
Interest Payment Date
The Interest shall be due and payable on a
pro rata basis pursuant to clause 5.3 on 20
March, 20 June, 20 September and 20
December of each respective calendar
year (in each case a "Payment Date"). In
the event that the Commencement Date
does not fall on the first calendar day of a
quarter, the Interest shall be calculated for
the incomplete quarter on a pro-rata basis
pursuant to clause 5.3. In the event that
the Due Date pursuant to clause 10.1 does
not fall on the last calendar day of a
quarter, the Interest shall also be paid for
the that incomplete quarter on a pro-rata
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Interest
unvollständige Quartal pro rata temporis
gemäß Ziffer 5.3 zu leisten.
5.3
Pro-rata-Berechnung
basis pursuant to clause 5.3.
5.3
Soweit der Zins für einen Zeitraum pro
rata temporis zu berechnen ist, wird er
auf der Basis der tatsächlichen Anzahl
von Tagen in dem maßgeblichen
Zeitraum, dividiert durch die Anzahl der
Tage (365 bzw. 366) im jeweiligen
Zinsjahr, berechnet.
5.4
Erhöhter Zins
Where the Interest is to be calculated on a
pro-rata basis for a period, it shall be
calculated on the basis of the actual
number of days in the material period,
divided by the number of days (365 or, as
the case may be, 366) of the respective
interest year.
5.4
Increased Interest
Wird
der
Zins
nach
seinem
Zahlungstermin gemäß Ziffer 5.2
gezahlt, so erhöht er sich für den
Zeitraum vom Tag des jeweiligen
Zahlungstermins (ausschließlich) bis zu
dem Tag der tatsächlichen Leistung
(einschließlich) pro rata temporis gemäß
Ziffer 5.3 auf
In the event that the Interest is paid after
its Payment Date pursuant to clause 5.2,
the Interest shall be increased for the
period from the respective Payment Date
(exclusively) up to and including the date
of the actual payment on a pro-rata basis
pursuant to clause 5.3, to
(a)
15 % p.a. des Nominalbetrages,
wenn die Schuldnerin der
Verpflichtung zur Zahlung des
Zinses erstmalig an einem
Zahlungstermin
nicht
fristgerecht nachkommt, und
auf
(a)
15 per cent. p.a. of the Nominal
Amount where the Borrower
fails to fulfil its Interest payment
obligation on a Payment Date
within the time limit for the first
time, and
(b)
20 % p.a. des Nominalbetrages,
wenn die Schuldnerin der
Verpflichtung zur Zahlung an
zwei
aufeinanderfolgenden
Zahlungsterminen
nicht
fristgerecht nachkommt.
(b)
20 per cent. p.a. of the Nominal
Amount where the Borrower
fails to fulfil its Interest payment
obligation within the time limit
on two consecutive Payment
Dates.
§6
BILANZBEURTEILUNG
6.1
Pro-rata Calculation
Die Schuldnerin unterwirft sich für jedes
Geschäftsjahr
einer
jährlichen
Bilanzbeurteilung
(die
"Bilanzbeurteilung") nach Moody's
KMV RiskCalc, welche auf Grundlage
des nach Ziffer 11.1 an die Gläubigerin
zu übermittelnden Jahresabschlusses von
der Gläubigerin oder einen durch sie
beauftragten Dritten erstellt wird. Die
Bilanzbeurteilung wird durch Moody's
KMV Company durchgeführt.
§6
Assessment of Financial Statements
6.1
For each business year, the Borrower
shall be subject to an annual assessment
of his financial statements (the
"Assessment of Financial Statement")
applying Moody's KMV RiscCalc. The
Assessment of Financial Statement shall
be made by the Creditor or a third party
instructed by the Creditor on the basis of
the financial statement of the Borrower to
be sent to the Creditor pursuant to clause
11.1. The Assessment of Financial
Statement will be made by Moody's KMV
Company.
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Assessment of Financial Statements
6.2
Die im Zusammenhang mit der
jährlichen
Bilanzbeurteilung
entstehenden Kosten werden von der
Gläubigerin getragen.
6.2
Any costs in relation to the Assessment of
Financial Statements will be borne by the
Creditor.
6.3
Die Gläubigerin ist verpflichtet, das
Ergebnis der Bilanzbeurteilung innerhalb
von 30 Geschäftstagen nach Erhalt des
Jahresabschlusses
der
Schuldnerin
schriftlich bekannt zu geben. Ein
Nichteinhalten dieser Bekanntgabefrist
hat die Gläubigerin nicht zu vertreten,
wenn dies auf einer durch Moody's KMV
Company zu vertretenden Verzögerung
der Durchführung der Bilanzbeurteilung
beruht. Auf Verlangen stellt die
Gläubigerin der Schuldnerin auch die
dem
Ergebnis
der
jeweiligen
Bilanzbeurteilung nach Moody's KMV
RiskCalc zugrunde liegenden Daten zur
Verfügung.
6.3
The Creditor shall be obliged to notify the
Borrower in writing within 30 business
days after receipt of the financial
statement of the Borrower on the result of
the Assessment of Financial Statements.
The Creditor shall not be liable for any
breach of the term of the aforementioned
information obligation, if such breach is
based on a delay in the Assessment of
Financial Statements for which Moody's
KMV Company is responsible. On
demand of the Borrower the Creditor will
send to the Borrower a copy of the data
on which the respective Assessment of
Financial Statement by Moody's KMV
Riskcalc is based.
6.4
Unterschreitet die Bilanzbeurteilung der
Schuldnerin für zwei aufeinander
folgende Geschäftsjahre Baa3.edf, so
erhöht sich für den Zeitraum vom Tag
der
Bekanntgabe
der
zweiten
Bilanzbeurteilung an die Schuldnerin
gemäß Ziffer 6.3 bis zum Tag der
Bekanntgabe der Bilanzbeurteilung für
das
folgende
Geschäftsjahr
(ausschließlich) der geschuldete Zins
gemäß Ziffer 5.1 um 50 Basispunkte p.a
berechnet auf den Nominalbetrag.
6.4
If the Assessment of Financial Statement
falls short of Baa3.edf for two subsequent
business years, the interest payable
pursuant to clause 5.1 will be increased
by 50 basis points on the Nominal
Amount from the day of notification
regarding the second Assessment of
Financial Statement to the Borrower
pursuant to clause 6.3 up to the date of the
issuance of the Assessment of Financial
Statements for the following business
year (excluding).
§7
KAPITALERTRAGSTEUER
§7
Withholding Tax
Von dem auf das Darlehen zu zahlenden
Zins ist von der Schuldnerin nach
derzeitiger
Rechtslage
keine
Kapitalertragsteuer einzubehalten.
Applicable law does not provide for
withholding tax on interest to be withheld
by the Borrower.
Für den Fall, dass vom Zins aufgrund
einer Gesetzesänderung oder eines
bestandskräftigen Steuerbescheids der
für
die
Schuldnerin
zuständigen
Finanzbehörde
Kapitalertragssteuer
einzubehalten ist, wird diese von der
Schuldnerin einbehalten und an das
zuständige Finanzamt abgeführt. Die
Schuldnerin übersendet der Gläubigerin
innerhalb von 15 Kalendertagen eine,
entsprechend gesetzlichen Vorschriften
erstellte,
Kapitalertragsteuerbescheinigung
und
innerhalb von 20 Kalendertagen eine
Bestätigung
der
zuständigen
Finanzbehörde über die Abführung der
In the event that, due to an amendment of
applicable law or due to a binding tax
statement issued by the competent tax
office withholding tax on interest is to be
withheld, such tax shall be withheld from
the Interest by the Borrower to the
competent tax office. The Borrower shall,
within 15 calendar days, provide the
Creditor with a withhold certificate issued
in accordance with applicable law and
with a certificate of the competent tax
authorities confirming the payment of the
withholding tax on interest. The Borrower
is not under an obligation to make a
compensatory payment to the Creditor in
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Kapitalertragssteuer an diese. Eine
Ausgleichsverpflichtung der Schuldnerin
gegenüber der Gläubigerin hinsichtlich
der einbehaltenen Steuer besteht nicht.
respect of the withheld tax.
§8
LAUFZEIT
§8
Term of Loan
Die Laufzeit beginnt mit dem
Anfangsdatum und endet mit dem
siebten Jahrestag des Anfangsdatums
(das "Enddatum").
The term of the Loan shall start at the
Commencement Date and shall end at the
seventh
anniversary
of
the
Commencement Date (the "End Date").
§9
AUßERORDENTLICHE
KÜNDIGUNG
9.1
§9
Extraordinary Termination
Die Schuldnerin wie auch die
Gläubigerin
sind
berechtigt,
das
Darlehen aus wichtigem Grund jederzeit,
ohne Rücksicht auf Termin und Frist
schriftlich
zu
kündigen
(die
"Außerordentliche Kündigung"). Als
wichtiger Grund für die Kündigung
durch die Gläubigerin gilt insbesondere:
9.1
Both the Borrower and the Creditor may
terminate the Loan at any time in writing
for good cause, regardless of any date and
notice period and with immediate effect
("Extraordinary Termination"). A good
cause for a termination by the Creditor
shall particularly be:
(a)
die Liquidation der Schuldnerin;
(a)
liquidation of the Borrower;
(b)
die
Eröffnung
eines
Insolvenzverfahrens über das
Vermögen der Schuldnerin oder
die Abweisung der Eröffnung
eines
derartigen
Verfahrens
mangels Masse;
(b)
institution
of
insolvency
proceedings over the assets of the
Borrower or the dismissal of a
petition to open such proceedings
against the Borrower due to
insufficient assets;
(c)
die Veräußerung, Verpfändung
oder sonstige Belastung der
Geschäftsanteile
an
der
Schuldnerin
oder
deren
Umwandlung, soweit dadurch ein
Kontrollwechsel im Sinne des
Erwerbs
einer
Mehrheitsbeteiligung gemäß § 16
AktG durch eine bisher nicht
mehrheitlich an der Schuldnerin
beteiligte Partei erfolgt (der
"Kontrollwechsel");
(c)
disposal, pledge or other
encumbrance of shares in the
Borrower or a transformation of
the Borrower to the extent that
such event results in a change of
control within the terms of the
acquisition of a majority interest
pursuant to Sec. 16 German Act
on Public Limited Companies
(AktG) by a party, which has not
prior to such acquisition held a
majority interest in the Borrower
(the "Change of Control");
(d)
die fehlende Autorisierung
Begebung des Darlehens
Schuldnerin
durch
zustimmungsbefugten Organe
Schuldnerin;
zur
der
die
der
(d)
lack of authorisation on the part
of the competent bodies of the
Borrower to issue the Loan;
(e)
die
Verletzung
Informationsrechte
Gläubigerin
nach
Vereinbarung
durch
der
der
dieser
die
(e)
breach by the Borrower
Creditor's information
under this Agreement,
such breach is immaterial
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of the
rights
unless
for the
Schuldnerin, es sei denn, die
Verletzung
ist
für
die
Wahrnehmung der Rechte der
Gläubigerin nicht wesentlich,
sowie die ausdrückliche oder
konkludente
Weigerung
der
Schuldnerin,
den
unter
"zusätzliche Informationsrechte"
bestimmten
Workshop
durchzuführen;
claim of the Creditor's rights, as
well as the explicit or implied
refusal by the Borrower to
conduct certain workshops as
defined in the clause referring to
"additional information rights";
(f)
die Verletzung der Verpflichtung
der Schuldnerin zur Aufstellung
und Feststellung des geprüften
Jahres- und Konzernabschlusses
innerhalb der in Ziffer 11.1
bestimmten Frist, soweit die
Schuldnerin
nach
den
maßgeblichen
gesetzlichen
Vorschriften zur Aufstellung und
Prüfung derartiger Abschlüsse
verpflichtet ist;
(f)
breach by the Borrower of the
obligation to prepare and
approve
the
audited
unconsolidated and consolidated
annual financial statements
within the time limits provided
by clause 11.1, where the
Borrower is obliged pursuant to
the relevant statutory provisions
to prepare and audit such
financial statements;
(g)
eine durch die Schuldnerin
vorgenommene Maßnahme, die
außerhalb ihres ordentlichen und
üblichen Geschäftsbetriebs liegt
(insbesondere die vollständige
oder teilweise Einstellung des
Geschäftsbetriebs
oder
eine
Umwandlung), sofern dadurch die
wirtschaftliche Grundlage der
Schuldnerin gefährdet und die
Rechtsstellung
oder
das
wirtschaftliche Interesse der
Gläubigerin
wesentlich
beeinträchtigt wird;
(g)
any action taken by the Borrower
which does not form part of its
ordinary and usual business
(including, but not limited to, the
full or partial cessation of
business operations or the
transformation of the Borrower),
to the extent that such action has
a potential adverse effect on the
economic status of the Borrower
resulting
in
a
material
impairment of the legal status or
the economic interest of the
Creditor;
(h)
die
auf
einen
Gewinnverteilungsbeschluss
beruhende Ausschüttung von
Gewinnen der Schuldnerin an die
Aktionäre derSchuldnerin, die vor
einer vollständigen Zahlung der
fälligen Zinsen an die Gläubigerin
erfolgt;
(h)
distributions of profits of the
Borrower based on a profit
distribution resolution made to
the shareholders of the Borrower
prior to the full payment of the
due Interest to the Creditor;
(i)
die Kapitalherabsetzung oder
sonstige
Rückführung
von
Eigenkapital (zusammen die
"EK-Rückführung")
der
Schuldnerin, soweit die EKRückführung mehr als 25 % des
Nominalbetrages des Darlehens
beträgt.
Beträgt
die
EKRückführung weniger als 25 %
des
Nominalbetrages
des
Darlehens, so stellt die EK-
(i)
the capital redemption or other
repayment of equity (together the
"Equity Repayment") of the
Borrower provided that the
Equity Repayment amounts to
more than 25 per cent. of the
Nominal Amount of the Loan. If
the Equity Repayment amounts
to less than 25 per cent. of the
Nominal Amount of the Loan the
Equity Repayment shall be a
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Rückführung einen wichtigen
Grund dar, soweit hierdurch die
Bedienung der Zinsen des
Darlehens
sowie
dessen
Rückzahlung zum Enddatum
gefährdet
würde.
Die
entsprechenden Umstände der
EK-Rückführung sind durch die
Schuldnerin auf Verlangen der
Gläubigerin nachzuweisen. Die
auf
einem
Gewinnverteilungsbeschluss
beruhende Ausschüttung von
Gewinnen der Schuldnerin gilt
nicht als Rückführung von
Eigenkapital im Sinne dieser
Ziffer. Vorstehende Ziffer (h)
bleibt unberührt; und
(j)
9.2
good cause for termination if the
Equity
Repayment
is
jeopardizing the payment of the
Interest or the repayment of the
Loan at the End Date. The
Borrower shall inform the
Creditor on the circumstances of
the Equity Repayment by request
of the Creditor. The distributions
of profits of the Borrower based
on a profit distribution resolution
shall not be deemed as an Equity
Repayment within the meaning
of this clause. Clause 9.1 (h)
shall remain unaffected; and
die Verletzung von wesentlichen
Verpflichtungen nach dieser
Vereinbarung (insbesondere die
Rückführung
von
Darlehen
gemäß Ziffer 16(b) ohne die
vorherige
Zustimmung
der
Gläubigerin).
Die Außerordentliche Kündigung auf
Grund eines Kontrollwechsels gemäß
9.1(c) kann nur ausgeübt werden, wenn
die Schuldnerin nicht innerhalb von 25
Geschäftstagen
nach
dem
Kontrollwechsel
gegenüber
der
Gläubigerin schriftlich nachweist, dass
durch
den
Kontrollwechsel
die
Bilanzbeurteilung der Schuldnerin (unter
Berücksichtigung des oder der neuen
Aktionäre und der Umstände des
Kontrollwechsels) nicht unter Baa3.edf
Moody's RiskCalc absinkt.
(j)
9.2
§ 10
RÜCKZAHLUNG
10.1
Der Nominalbetrag des Darlehens wird
am
Enddatum
vorbehaltlich
des
Rangrücktritts nach Ziffer 13 zur
Rückzahlung fällig und zahlbar. Im Falle
einer Außerordentlichen Kündigung wird
der Nominalbetrag des Darlehens
vorbehaltlich des Rangrücktritts nach
Ziffer 13 am 30. Geschäftstag nach
Zugang der Kündigungserklärung zur
Rückzahlung fällig und zahlbar. Der
Tag, an dem der Nominalbetrag nach
dieser Ziffer 10 zur Rückzahlung fällig
wird,
wird
als
"Fälligkeitstag"
bezeichnet.
The Extraordinary Termination caused by
a Change of Control pursuant to clause 9.1
(c) only shall be exercised, if the Borrower
would not prove within 25 business days
after the Change of Control to the Creditor
in writing that the Assessment of Financial
Statement of the Borrower is not lowered
by the Change of Control under Baa3.edf
Moody's
Risk
Calc.
The
new
shareholder(s) and the circumstances of
the Change of Control shall be taken into
account.
§ 10
Repayment
10.1
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the breach of important duties of
the Borrower pursuant to this
Agreement
(especially
the
repayment of loans pursuant to
clause 16 (b) without the prior
consent of the Creditor).
On the End Date, the Nominal Amount of
the Loan shall become due and payable
for repayment subject to subordination
pursuant to clause 13. In the event of
Extraordinary Termination, the Nominal
Amount of the Loan shall become due
and payable for repayment on the 30th
Business Day after receipt of the notice of
termination, subject to subordination
pursuant to clause 13. The day on which
the Nominal Amount becomes due for
repayment under this clause 10.1 is
referred to as the "Due Date".
10.2
Sollte eine Außerordentliche Kündigung
durch die Gläubigerin vor dem
Enddatum wirksam werden, so ist neben
dem Nominalbetrag und gleichzeitig mit
diesem auch die Summe aller Beträge
der Zinsen, die bis zum Enddatum
angefallen wären, fällig und zahlbar. Der
Zeitraum zwischen Wirksamwerden der
Außerordentlichen Kündigung und dem
Enddatum wird "Restlaufzeit" genannt.
10.2
In the event that Extraordinary
Termination by the Creditor becomes
effective prior to the End Date, the sum of
all Interest amounts which would have
been accrued by the End Date, shall, in
addition to the Nominal Amount, also be
due and payable at the same time as the
Nominal Amount. The period between the
effectiveness
of
Extraordinary
Termination and the End Date shall be
referred to as the "Residual Term".
10.3
Von dem für die Restlaufzeit zu
zahlenden Zins ist der Ertrag abzuziehen,
den eine Anlage des Nominalbetrages in
eine Anleihe der Bundesrepublik
Deutschland, welche zum Enddatum
fällig ist, für die Restlaufzeit erbringen
würde. Der Abzug erfolgt jedoch nur
insoweit, als dieser Ertrag den Zins der
Restlaufzeit nicht übersteigt. Bei der
Berechnung des Ertrages sind die bei
einer derartigen Anlage üblicherweise
anfallenden Gebühren vom Ertrag
abzuziehen.
10.3
The revenue which would have been
realised from an investment of the
Nominal Amount for the Residual Term
on the basis of an investment in a bond
issued by the Federal Republic of
Germany and with a maturity date on the
End Date and shall be deducted from the
Interest. A deduction shall be made,
however, only to the extent that this
revenue does not exceed the Interest of
the Residual Term. When calculating the
revenue, any charges usual for such
investment shall be deducted from the
revenue.
10.4
Der Zinslauf endet am Fälligkeitstag
(einschließlich).
Erfolgt
am
Fälligkeitstag keine vollständige Zahlung
des
Nominalbetrages
durch
die
Schuldnerin an die Gläubigerin, so steht
der Gläubigerin auch für den Zeitraum
vom Fälligkeitstag (einschließlich) bis
zum Tag der tatsächlichen vollständigen
Zahlung
des
Nominalbetrages
(einschließlich) der pro rata temporis
gemäß Ziffer 5.3 anfallende
10.4
The interest payment period shall end on
and include the Due Date. In the event
that full payment of the Nominal Amount
is not made to the Creditor by the
Borrower on the Due Date, the Creditor
shall also be entitled to Interest accruing
on a pro-rata basis pursuant to clause 5.3
for the period as of the Due Date
(including the Due Date) up to and
including the date of actual full payment
of the Nominal Amount. Clause 5.4 is to
be applied accordingly.
§ 11
INFORMATIONSRECHTE DER
GLÄUBIGERIN
11.1
Die Schuldnerin ist verpflichtet, der
Gläubigerin unverzüglich nach
Feststellung des Jahres- und/oder
Konzernabschlusses, jedoch in keinem
Fall später als sechs Monate nach dem
Ende des jeweiligen Geschäftsjahres
kostenfrei eine Abschrift des Jahresund/oder Konzernabschlusses nebst
Lage- und/oder Konzernlagebericht
sowie den Bericht des Abschlussprüfers
über die Prüfung des Jahres- und/oder
Konzernabschlusses sowie des Lageund/oder Konzernlageberichtes zu
übersenden.
§ 11
Information Rights of the Creditor
11.1
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The Borrower shall send the Creditor, free
of charge and without undue delay, upon
approval of the unconsolidated and/or
consolidated annual financial statements,
however, in no event later than six
months after the end of the respective
fiscal year, a copy of such annual
financial statements together with the
management report of the Borrower
and/or the group as well as the auditor's
report on the audit of the unconsolidated
and/or consolidated annual financial
statements as well as the management
report of the Borrower and/ or the group.
11.2
Enthält der Bestätigungsvermerk des
Abschlussprüfers zum Jahres- und/oder
Konzernabschluss Einschränkungen,
wird der Bestätigungsvermerk versagt,
so ist die Gläubigerin berechtigt, den
Jahres- und/oder den Konzernabschluss
auf Kosten der Schuldnerin prüfen zu
lassen.
11.2
In the event that the audit certificate is
refused, or contains restrictions in relation
to the unconsolidated and/or consolidated
annual financial statements or in the event
that there are otherwise reasonable doubts
as to the compliance with accounting
principles, the Creditor shall be entitled to
arrange for an examination of the
unconsolidated and / or consolidated
annual financial statements at the
Borrower's expense.
11.3
Die Gläubigerin ist von der Schuldnerin
ohne gesonderte Aufforderung
unverzüglich über solche Ereignisse zu
informieren, die von wesentlicher
Bedeutung für die Rechtsstellung oder
das wirtschaftliche Interesse der
Gläubigerin sein könnten. Insbesondere
ist die Schuldnerin verpflichtet, die
Gläubigerin unverzüglich zu
informieren, wenn sie davon Kenntnis
erhält, dass ein Umstand gemäß Ziffer
9.1 (c) oder (j) bevorsteht oder
eingetreten ist.
11.3
The Borrower shall inform the Creditor
without undue delay and without any
special request, of any special events
which could be of material relevance to
the legal status or the economic interests
of the Creditor. In particular, the
Borrower shall inform the Creditor
without undue delay if it has knowledge
of a situation pursuant to clause 9.1 (c) or
(j) being imminent or having arisen.
11.4
Die vorgenannten Informationsrechte der
Gläubigerin werden durch eine oder
mehrere zur Verschwiegenheit
verpflichteten Personen ausgeübt (der
"Monitoring Agent"). Der Monitoring
Agent ist berechtigt, die
Informationsrechte seinerseits durch zur
Verschwiegenheit verpflichtete Personen
auszuüben.
11.4
The
Creditor's
aforementioned
information rights shall be exercised by
one or several persons under an obligation
to
maintain
confidentiality
(the
"Monitoring Agent"). The Monitoring
Agent shall be entitled to exercise the
information rights by using persons under
an obligation to maintain confidentiality.
§ 12
ZUSÄTZLICHE
INFORMATIONSRECHTE BEI
BONITÄTSVERSCHLECHTERUNG
ODER BEI
ZAHLUNGSRÜCKSTAND
12.1
Zur Wahrung ihrer finanziellen
Interessen stehen der Gläubigerin die
nachfolgend aufgeführten Rechte zu
bzw. treffen die Schuldnerin nachfolgend
aufgeführte Pflichten, falls (i) die
Schuldnerin der Verpflichtung zur
Zahlung des Zinses an zwei aufeinander
folgenden Zahlungsterminen gemäß
Ziffer 5.2 nicht vollständig
nachgekommen ist, (ii) der Gesamtbetrag
der Zahlungen auf den Zins, mit dem
sich die Gesellschaft in Verzug befindet,
den Betrag des für 2
Dreimonatszeiträume zahlbaren Zinses
erreicht oder übersteigt, oder (iii) die
§ 12
Additional Information Rights in the
Event of Deterioration of
Creditworthiness or Payment Default
12.1
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To safeguard its financial interests, the
Creditor shall be entitled to the rights
specified hereinafter and the Borrower
shall have the duties specified hereinafter
in the event that (i) the Borrower fails to
fulfil its payment obligation of the
Interest on two consecutive Payment
Dates pursuant to clause 5.2, (ii) the total
amount of outstanding payments on the
Interest has attained or exceeded the
amount of the Interest payable for two
three month periods, or (iii) the Financial
Statement Assessment pursuant to clause
6.1 of the Borrower is lowered to a B1.edf
or below. The Creditor is entitled to the
12.2
Bilanzbeurteilung der Schuldnerin nach
Ziffer 6.1 auf B1.edf oder darunter
absinkt. Der Gläubigerin stehen die
zusätzlichen Rechte gemäß (a) und (b) zu
und die Schuldnerin treffen die Pflichten
gemäß (c) und (d), solange der
Zahlungsverzug nicht vollständig
behoben ist.
additional rights pursuant to (a) and (b)
and the Borrower shall have the duties
pursuant to (c) and (d), unless the default
in payment has been fully remedied.
(a)
Die Gläubigerin ist berechtigt,
sich über alle wesentlichen
Geschäfte und Verträge der
Schuldnerin zu informieren. Die
Schuldnerin ist verpflichtet, der
Gläubigerin auf Verlangen alle
diesbezüglichen
Informationen
bereitzustellen.
(a)
The Creditor is entitled to inform
itself of all material transactions
and contracts of the Borrower.
The Borrower shall provide the
Creditor, upon request, with all
information in respect thereof.
(b)
Auf Verlangen der Gläubigerin
wird die Geschäftsführung der
Schuldnerin monatlich einen
Bericht über alle wesentlichen
Entwicklungen erstatten und ihr
ermöglichen, den Bericht durch
Einsicht in die Bücher und
Schriften der Schuldnerin zu
überprüfen.
(b)
Upon the request of the Creditor,
the management of the Borrower
shall provide it with a report on a
monthly basis on all material
developments and enable it to
review the report by inspection
of the Borrower's accounts and
documents.
(c)
Bevor die Schuldnerin mit
Kapitalgebern, die noch nicht an
der Schuldnerin mit Eigen- oder
Fremdkapital
beteiligt
sind,
Gespräche über die Sanierung der
Schuldnerin führt, wird sie solche
Gespräche zunächst mit dem
Monitoring Agent führen.
(c)
The Borrower shall conduct any
talks regarding the capital
reconstruction of the Borrower
with the Monitoring Agent
before conducting such talks
with investors, who do not yet
have equity or debt capital in the
Borrower.
(d)
Die Schuldnerin verpflichtet sich,
mit einem durch die Gläubigerin
bestellten Recovery Manager
einen
eintägigen
Workshop
durchzuführen. Im Rahmen dieses
Workshops wird ein Turnaround
Plan
für
die
Schuldnerin
erarbeitet.
(d)
The Borrower shall conduct a
one-day workshop with a
recovery manager appointed by
the Creditor. In the course of that
workshop, a turnaround plan for
the Borrower shall be devised.
Angemessene Kosten, die durch die
Maßnahmen gemäß Ziffer 12.2(a) bis (c)
bei der Gläubigerin und von ihr
beauftragten Dritten entstehen, sind von
der Schuldnerin unverzüglich nach
Rechnungslegung zu erstatten. Die
Kosten, die im Rahmen von Maßnahmen
nach Ziffer 12.2(d) entstehen, sind bis zu
einem Betrag von EUR 5000,unverzüglich nach Rechnungslegung
durch die Schuldnerin zu tragen.
12.2
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Any reasonable costs incurred by the
Creditor and/or any of its authorised third
parties, as a result of the measures
pursuant to clause 12.1 (a) to (c), are to be
reimbursed by the Borrower without
undue delay after receiving the cost
statement. The costs which arise within
the framework of measures pursuant to
clause 12.1 (d), shall be borne by the
Borrower in an amount of up to
EUR 5.000 without undue delay after
receiving the cost statement.
12.3
Die vorgenannten zusätzlichen
Informationsrechte der Gläubigerin
werden durch den Monitoring Agent
wahrgenommen.
12.3
§ 13
RANGRÜCKTRITT
The
aforementioned
additional
information rights of the Creditor shall be
exercised by the Monitoring Agent.
§ 13
Subordination
13.1
Die Gläubigerin tritt nach Maßgabe der
Ziffer 13.2 mit ihrem Anspruch auf
Rückzahlung des Nominalbetrages und
ihrem Anspruch auf Zinszahlung nach
dieser Vereinbarung dergestalt im Rang
hinter die Forderungen aller bestehenden
und künftigen Gläubiger der Schuldnerin
(jeweils ein "Vorrangiger Gläubiger")
zurück, dass sie erst nach Befriedigung
sämtlicher Gesellschaftsgläubiger und,
soweit ein Liquidationsüberschuss oder
ein die sonstigen Verbindlichkeiten
übersteigendes Vermögen der
Gesellschaft hierfür zur Verfügung steht,
nur zugleich mit, im Rang jedoch vor
den Einlagerückgewähransprüchen der
Aktionäre der Schuldnerin Erfüllung
dieser Ansprüche verlangen kann. Der
Nachrang gilt auch im
Insolvenzverfahren.
13.1
The Creditor hereby subordinates its
claim to the repayment of the Nominal
Amount and its claim to receive Interest
payments arising under clause 13.2 of this
Agreement to the claims of all existing
and future creditors of the Borrower (each
a "Senior Creditor") in such manner that
a repayment can only be claimed after the
satisfaction of all other creditors of the
Borrower and, provided that a liquidation
surplus or other assets exceeding the other
liabilities of the Borrower are available to
the Borrower for such repayment. The
Creditor shall be entitled to claim
repayment at the same time but ranking
prior to claims to refunds of capital
contributions of the shareholders of the
Borrower. This subordination also applies
for insolvency proceedings.
13.2
Der in Ziffer 13.1 erklärte Rangrücktritt
gilt nur, solange und soweit durch eine
teilweise oder vollständige Befriedigung
des im Rang zurückgetretenen
Anspruchs der Gläubigerin eine
Überschuldung oder eine
Zahlungsunfähigkeit im
insolvenzrechtlichen Sinne der
Schuldnerin entsteht oder zu entstehen
droht.
13.2
The subordination specified in clause 13.1
shall only apply if, and to the extent that
over-indebtedness of the Borrower or his
illiquidity in accordance with the
provisions of the German insolvency law
would arise or be imminent as a result of
a partial or full satisfaction of the
subordinated claim of the Creditor.
13.3
Vorbehaltlich des Rangrücktritts nach
Ziffer 13.1 bleibt die Gleichrangigkeit
der Forderungen der Gläubigerin mit den
Forderungen anderer im Rang
entsprechend zurückgetretener Gläubiger
von dieser Vereinbarung unberührt.
13.3
Subject to the subordination pursuant to
13.1, the pari passu ranking of the
Creditor's claims along with the claims of
other subordinated creditors which do
rank pari passu, shall remain unaffected
by this Agreement.
13.4
Die Schuldnerin versichert, dass ihre
Aktionäre für ihre derzeitigen
eigenkapitalersetzenden Forderungen
ausdrücklich den Rücktritt im Range
nach den Ansprüchen der Gläubigerin
erklärt haben und auf eine vorrangige
Befriedigung im Rang von § 39 Abs. 1
Nr. 5 InsO verzichten. Die Schuldnerin
verpflichtet sich zudem zukünftige
Leistungen der Aktionäre, die in einer
Krise der Gesellschaft
13.4
The
Borrower
ensures
that
its
shareholders have expressly declared
subordination in relation to their current
and equity capital substituting claims
behind the claims of Creditor and have
waived their right to prior-ranking
satisfaction pursuant to Sec. 39 Para 1 No.
5 of the German Insolvency Code (InsO).
In addition, the Borrower undertakes to
receive
future
payments
of
its
shareholders, which could be considered
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eigenkapitalersetzend sein und unter § 39
Abs. 1 Nr. 5 InsO fallen können, nur
unter der Voraussetzung zu akzeptieren,
dass die Aktionäre mit ihren daraus
entstehenden Forderungen gegenüber der
Schuldnerin ebenfalls ausdrücklich den
Rücktritt im Range nach den Ansprüchen
der Gläubigerin erklären und auf eine
vorrangige Befriedigung im Rang von §
39 Abs. 1 Nr. 5 InsO verzichten.
substitute for equity capital when the
Borrower is in a crisis and which may
come under Sec. 39 Para 1 No. 5 of the
German Insolvency Code, only if the
shareholders likewise expressly declare
subordination of their claims arising there
under behind the claims of the Creditor
and waive their right to prior-ranking
satisfaction pursuant to Sec. 39 Para 1 No.
5 of the German Insolvency Code.
§ 14
ABTRETUNG VON RECHTEN AUS
DIESER VEREINBARUNG
§ 14
Assignment of rights under this
Agreement
14.1
Die Schuldnerin ist nicht berechtigt, ihre
Ansprüche oder sonstige Rechte aus
dieser Vereinbarung ohne Zustimmung
der Gläubigerin an Dritte zu übertragen,
zu verpfänden oder in sonstiger Weise zu
belasten.
14.1
The Borrower is prohibited from
assigning, pledging or encumbering in
any way its claims or other rights under
this Agreement to third parties without
the prior consent of the Creditor.
14.2
Die Gläubigerin ist berechtigt, ihre aus
dieser Vereinbarung resultierenden
Ansprüche auf Zahlung von Geld durch
die Schuldnerin zu verkaufen und/oder
abzutreten oder Sicherheiten daran zu
bestellen, insbesondere im
Zusammenhang mit der Refinanzierung
des Darlehens.
14.2
The Creditor shall be entitled to sell
and/or assign its claims to any payment of
money by the Borrower under this
Agreement and/or grant securities over
any such claims, in particular in
connection with the refinancing of the
Loan.
14.3
Die Gläubigerin ist darüber hinaus
berechtigt, mit Zustimmung der
Schuldnerin ihre Rechtsstellung aus
dieser Vereinbarung mit allen Rechten
und Pflichten ganz oder teilweise auf
einen Dritten zu übertragen (die
"Vertragsübernahme"). Die
Schuldnerin erteilt bereits jetzt
unwiderruflich ihre Zustimmung zu einer
Vertragsübernahme auf einen durch die
Gläubigerin zu benennenden Dritten für
den Fall, dass
14.3
The Creditor, with the prior consent of the
Borrower, shall further be entitled to
assign its legal status under this
Agreement in full or in part, together with
all rights and duties to a third party
("Assumption of Agreement"). The
Borrower hereby gives its irrevocable
consent to an assignment of the Loan to a
third party to be appointed by the
Creditor, in the event that
(a)
die Gläubigerin innerhalb von 20
Geschäftstagen
nach
dem
Anfangsdatum diesen Dritten
benennt oder
(a)
the Creditor appoints that third
party within 20 business days of
the Commencement Date or
(b)
die in Ziffern 12.2 (i) oder 12.2
(ii) bezeichneten Bedingungen
eingetreten sind.
(b)
the conditions specified in clauses
12.1 (i) or 12.1 (ii) of this
Agreement have been fulfilled.
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§ 15
ZUSICHERUNG UND
VERPFLICHTUNGEN DER
SCHULDNERIN
§ 15
Borrower's Representation and
Covenants
15.1
Die Schuldnerin sichert zu, dass ihr
Geschäftsbetrieb und ihre
Vermögensgegenstände nach Art und
Umfang branchenüblich ausreichend
versichert sind. Auf Verlangen ist dies
der Gläubigerin nachzuweisen.
15.1
The Borrower represents that its business
undertaking and its assets are sufficiently
insured to the extent and in the manner
that is usual in that line of business. The
Borrower shall provide evidence thereof
to the Creditor upon request.
15.2
Die Schuldnerin verpflichtet sich, der
Gläubigerin die von Zinsen einbehaltene
Kapitalertragsteuer in einer dem jeweils
geltenden Recht entsprechenden
Steuerbescheinigung unverzüglich nach
Zinszahlung zu bescheinigen.
15.2
The Borrower shall be obliged to issue
without undue delay after the Interest
payment a withholding tax certificate
being in accordance with the current tax
law to the Creditor.
§ 16
VERWENDUNG DES
NOMINALBETRAGES
§ 16
Appropriation of the Nominal Amount
Die Schuldnerin wird den Nominalbetrag
für Zwecke des Geschäftsbetriebes der
Schuldnerin nach eigenem Ermessen
verwenden. Dabei darf der
Nominalbetrag
The Borrower shall, at its sole discretion
use the Nominal Amount for business
purposes of the Borrower. In that respect,
the Nominal Amount may
(a)
insbesondere
zur
anderer Kapitalgeber;
Ablösung
(a)
be used, in particular, for the
discharge of other creditors;
(b)
zur
Ablösung
von
eigenkapitalersetzenden Darlehen
der Aktionäre bzw. diesen nahe
stehenden Personen i.S.d. § 1
Abs. 2 AStG oder gleichgestellten
Forderungen nur mit Zustimmung
der Gläubigerin; sowie
(b)
be used for the repayment of
equity capital substituting loans by
shareholders or by related persons
substituting equity capital pursuant
to Sec. 1 Para 2 of the German
Foreign Tax Relations Act (AStG)
or coequal claims, only with the
prior consent of the Creditor, and
(c)
nicht zur Rückzahlung
Eigenkapital
(c)
not be used for repayment of
equity capital.
von
verwendet werden.
§ 17
AUSGABE WEITERER
FINANZIERUNGSINSTRUMENTE
DURCH DIE SCHULDNERIN /
VERWÄSSERUNGSSCHUTZ
§ 17
Issuance of Additional Financing
Instruments by the Borrower / Dilution
Protection
Finanzierungsinstrumente
mit
gewinnabhängiger
oder
gewinnorientierter Vergütung sowie in
der
Insolvenz
der
Schuldnerin
nachrangige Finanzierungsinstrumente,
insbesondere
Genussrechte,
stille
Gesellschaftsverhältnisse,
partiarische
Additional financing instruments with
profit-related
or
profit-oriented
remuneration as well as financing
instruments which would be subordinated
in the event of the insolvency of the
Borrower,
in
particular,
profit
participation rights, silent partnerships,
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Darlehen,
Wandelschuldverschreibungen
und
Optionsschuldverschreibungen dürfen,
loans with profit participation, convertible
bonds and warrant-linked bonds may be
issued by the Borrower
(a)
sofern sie vorrangig vor den
Ansprüchen aus diesem Darlehen
zu bedienen wären
(a)
provided that such financing
instruments would rank senior to
claims under this Loan only with
prior written consent of the
Creditor;
(b)
sofern sie gleichrangig mit oder
nachrangig
gegenüber
Ansprüchen aus diesem Darlehen
zu bedienen wären
(b)
provided that they rank junior or
pari passu to claims under this
Loan, without the prior consent
of the Creditor. The Borrower
shall notify the Creditor in such
case without undue delay on the
receipt of the capital ranking
junior or pari passu to claims to
the Loan. The notification shall
include the key terms of the
respective
financing
documentation
(especially
amount, term, legal type,
remuneration,
dilution
protection) and the full wording
of the subordination provisions.
§ 18
ÄNDERUNG IN EINE
GENUSSRECHTSVEREINBARUNG
§ 18
Conversion into Profit Participation
Right Agreement
18.1
Die Schuldnerin ist berechtigt, diesen
Darlehensvertrag durch einseitige
schriftliche Erklärung gegenüber der
Gläubigerin in einen
Genussrechtsvereinbarung zu ändern.
Dieser unterliegt den in Anlage 18.1
genannten Bedingungen (die
"Genussrechtsvereinbarung").
18.1
The Borrower is entitled to convert this
Agreement into a profit participation right
agreement by written notice to the
Creditor. Such profit participation right
agreement shall be subject to the terms
and conditions set forth in Attachment
18.1 (the “Profit Participation Right
Agreement”).
18.2
Die Erklärung nach Ziffer 18.1 muss der
Gläubigerin innerhalb von drei Monaten
nach dem Anfangsdatum zugehen. Sie
wird mit ihrem Zugang bei der
Gläubigerin wirksam, wenn die
Schuldnerin der Gläubigerin mit Zugang
der Erklärung schriftlich nachweist, dass
die Begründung eines Genussrechts von
den zuständigen Organen wirksam
autorisiert wurde und etwaige
Bezugsrechte der Aktionäre wirksam
ausgeschlossen wurden
18.2
The notice pursuant to clause 18.1 shall
be delivered to the Creditor within three
months after the Commencement Date.
Upon delivery to the Creditor the notice
shall be valid if the Borrower proves at
that time that the constitution of the profit
participation right is authorized by the
competent corporate bodies of the
Borrower and that any subscription rights
of the shareholders were effectively
excluded.
18.3
Mit Ablauf des Tages des
Wirksamwerdens der Erklärung nach
18.1 sind nach Maßgabe der
nachfolgenden Ziffern 18.5 und 18.6 die
Bestimmungen der
Genussrechtsvereinbarung für die Rechte
18.3
With expiry of the day on which the
notice pursuant to clause 18.1 becomes
effective, the rights and obligations of the
parties hereto shall be subject to the terms
and conditions of the Profit Participation
Right Agreement in accordance with the
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und Pflichten der Parteien maßgeblich.
Ausgenommen hiervon sind bereits fällig
gewordene Zahlungsansprüche aus
diesem Darlehensvertrag.
provisions in clause 18.4 to 18.6. Any
payment claims already being due and
payable under this Agreement shall be
excluded.
18.4
Der Nominalbetrag im Sinne der
Genussrechtsvereinbarung entspricht
dem im Rahmen dieses
Darlehensvertrages an die Schuldnerin
gewährten Nominalbetrag.
18.4
The nominal amount within the meaning
of the Profit Participation Right
Agreement equals the Nominal Amount
paid to the Borrower under this
Agreement.
18.5
An die Stelle des Zinses gemäß Ziffer
5.1 tritt der in der
Genussrechtsvereinbarung vorgesehene
Zins.
18.5
Instead of the Interest pursuant to clause
5.1 of this Agreement, the advance
interest and the participation in profits as
provided in the Profit Participation Right
Agreement shall apply.
18.6
Als Anfangsdatum im Sinne der
Genussrechtsvereinbarung gilt das
Anfangsdatum im Sinne von Ziffer 1.2
dieser Vereinbarung.
18.6
Commencement date within the meaning
of the Profit Participation Right
Agreement shall be the Commencement
date within the meaning of clause 1.2 of
this Agreement.
§ 19
SCHLUSSBESTIMMUNGEN
§ 19
Final Provisions
19.1
Änderungen und Ergänzungen dieser
Vereinbarung bedürfen zu ihrer
Wirksamkeit der Schriftform, dies gilt
auch für die Änderung dieser
Schriftformklausel.
19.1
In order to be effective any amendments
and supplements to this Agreement must
be in writing. This applies also to a
waiver of this written form requirement.
19.2
Sollte eine Bestimmung dieser
Vereinbarung unwirksam sein oder sollte
diese Vereinbarung eine Lücke
enthalten, wird die Gültigkeit der übrigen
Bestimmungen hierdurch nicht berührt.
In einem solchen Fall sollen die
unwirksamen Bestimmungen durch
Bestimmungen ersetzt werden, die dem
Sinn und Zweck der unwirksamen
Bestimmungen entsprechen. Im Falle
von Lücken in dieser Vereinbarung soll
eine Bestimmung vereinbart werden, die
dem Sinn und der Absicht dieser
Vereinbarung entspricht und auf die die
Parteien dieser Vereinbarung sich
geeinigt hätten, falls das Problem von
Anfang an bedacht worden wäre.
19.2
Should any of the provisions of this
Agreement be ineffective, or should there
be a gap in this Agreement, the validity of
the remaining provisions hereof shall not
be affected thereby. In lieu of such
ineffective provision, an effective
provision which comes closest to the
intent and purpose of the ineffective
provision shall be deemed to have been
agreed. In the event of a gap, a provision
which corresponds to the intent and
purpose of this Agreement had the
contractual parties taken the matter into
consideration at the outset shall be
deemed to have been agreed.
19.3
Erfüllungsort ist Düsseldorf.
19.3
The place of performance is Düsseldorf.
19.4
Gerichtsstand für sämtliche
Rechtsstreitigkeiten aus dieser
Vereinbarung ist Düsseldorf.
19.4
The place of jurisdiction for any disputes
arising out of this Agreement is
Düsseldorf.
19.5
Auf diese Vereinbarung findet
ausschließlich deutsches Recht mit
Ausnahme der Bestimmungen des
19.5
This Agreement shall be governed by and
construed in accordance with the laws of
the Federal Republic of Germany with the
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deutschen internationalen Privatrechts
Anwendung.
exception of the provisions of German
private international law.
19.6
Die Schuldnerin und die Gläubigerin
verpflichten sich, Ziffer 12 nicht zulasten
der Vorrangigen Gläubiger ohne deren
vorherige Zustimmung zu ändern. Dies
gilt auch dann, wenn Dritte weitere
Finanzierungsinstrumente im Sinne von
Ziffer 16 erwerben.
19.6
The Borrower and the Creditor undertake
not to modify provisions in respect of the
issuance
of
additional
financing
instruments pursuant to clause 17 to the
Senior Creditors' detriment, without the
consent of these creditors. This shall also
apply, if additional financing instruments
within the meaning of clause 17 are
issued to any third party.
19.7
Die Aktionäre der Schuldnerin sowie
dieser nahe stehende Personen im Sinne
des § 1 Abs. 2 AStG und/oder
Angehörige im Sinne von § 15 AO
(einschließlich deren Rechtsnachfolger)
sind weder rechtlich noch tatsächlich
verpflichtet, für die
Zahlungsverpflichtungen der
Schuldnerin aus dieser Vereinbarung
einzustehen.
19.7
The shareholders of the Borrower as well
as related persons within the meaning of
Sec. 1 Para 2 of the German Foreign Tax
Act and/or relatives within the meaning of
Para 15 of the German Tax Code (AO)
(including their legal successors) are not
obliged either in fact or law to be liable
for the payment obligations of the
Borrower under this Agreement.
19.8
Soweit Bestimmungen in dieser
Vereinbarung die Zahlung pauschalierten
Schadensersatzes vorsehen, wird
vorbehaltlich der Regelung in Ziffer 5.4
der jeweils zur Zahlung dieses
Schadensersatzes verpflichteten Partei
der Nachweis eines niedrigeren oder der
jeweils zum Schadensersatz berechtigten
Partei der Nachweis eines höheren
Schadens nicht abgeschnitten.
19.8
Where provisions in this Agreement
provide for the payment of liquidated
damages, the party obliged to pay those
damages or the party entitled to claim
those damages shall, subject to the
provisions in clause 5.3 and clause 6.8 of
this Agreement, not be precluded from
proving that the damage is lower or
higher, respectively.
19.9
Soweit diese Vereinbarung nicht
ausdrücklich etwas anderes bestimmt,
werden alle Steuern, Gebühren, Abgaben
und sonstige Kosten, die aus dieser
Vereinbarung, insbesondere ihrem
Abschluss und ihrer Durchführung oder
einer Vertragsübernahme, entstehen, von
der Schuldnerin getragen.
19.9
Unless this Agreement expressly provides
otherwise, all taxes, charges, duties and
other costs which are incurred under this
Agreement, in particular, as regards its
conclusion and its implementation or an
Assumption of the Agreement, shall be
borne by the Borrower.
19.10
Sämtliche Zahlungen, die im Rahmen
dieser Vereinbarung von der Schuldnerin
an die Gläubigerin erfolgen, sind auf die
als Anlage 19.10 angefügte
Kontoverbindung zu überweisen.
Änderungen dieser Kontoverbindung
werden der Schuldnerin unverzüglich
schriftlich mitgeteilt. Die Mitteilung der
Änderung der Kontoverbindung
aufgrund einer Vertragsübernahme nach
Ziffer 14.3 erfolgt schriftlich mit der
Benachrichtigung über die
Vertragsübernahme.
19.10
Any payment to the Creditor pursuant to
this Agreement shall be made to the bank
account specified in Attachment 18.10
and the Borrower shall notify the Creditor
regarding any changes of this bank
account without undue delay in writing.
In case of an assumption of the
Agreement pursuant to clause 14.3 the
Borrower shall be notified regarding any
changes of the bank account of the
Creditor in writing and together with
notification regarding the assumption of
Agreement.
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19.11
Fällt eine Zahlungsverpflichtung nach
dieser Vereinbarung, insbesondere die
Pflicht zur Zinszahlung nach Ziffer 5.2
und die Pflicht zur Rückzahlung des
Nominalbetrages nach Ziffer 10.1 auf
einen Tag, der kein Geschäftstag ist, so
verschiebt sich die jeweilige Fälligkeit
auf den darauf folgenden Geschäftstag.
19.11
In the event that any Payment Date under
this Agreement, especially the payment
dates for the Interest pursuant to clause
5.2 and the Due Date pursuant to clause
10.1 does not fall on a Business Day, the
respective due date shall be postponed to
the next following Business Day.
19.12
Sofern der Schriftverkehr zwischen
Schuldnerin und Gläubigerin einen
Fristlauf auslöst, ist als Anfang der Frist
der Zugang maßgeblich, es sei denn, in
dieser Vereinbarung wurde hiervon
abweichend eine Regelung getroffen.
19.12
In the event that any correspondence in
writing between the Borrower and the
Creditor shall be decisive for the start of
any term under this Agreement, then the
receipt shall be decisive for the start of the
term, provided that this Agreement
provides for any different provision
therefore.
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Description of the Trust Deed
The descriptions in this section refer to certain material terms of the Trust Deed. These descriptions do
not purport to be complete and are subject to, and are qualified in their entirety by, the detailed
provisions of the Trust Deed.
Parties
The Trust Deed was executed as a deed on the Issue Date between the Issuer, BNP Paribas Trust
Corporation UK Limited, as Trustee for the Compartment 2 Noteholders and security trustee for the
Secured Parties, BNP Paribas Securities Services, Luxembourg branch as Calculation Agent and Cash
Administrator, Custom House Administration & Corporate Services Limited as Irish Paying Agent,
BNP Paribas, Luxembourg branch as Principal Paying Agent, Account Bank and Custodian, HSBC
Trinkaus & Burkhardt KGaA as Transaction Adviser and Lender and mbb Consult GmbH as Recovery
Manager.
Issuer's Covenants to Pay
Subject to the Terms and Conditions, the Issuer will, on any date when the Compartment 2 Notes or
any of them become due to be redeemed (in whole or in part), unconditionally pay or procure to be
paid to the Trustee all amounts of principal payable in respect of the Compartment 2 Notes which are
due for redemption on that date, together with any applicable premium or other amounts payable upon
redemption. The Issuer shall until (and, in the case of the Junior Notes in certain circumstances,
following) such payment, unconditionally pay to the Trustee, interest accrued on the Outstanding
Principal Amount of the Compartment 2 Notes or otherwise payable in respect of the Compartment 2
Notes together with any other amounts payable in respect of the Compartment 2 Notes. The Issuer will,
on any date when any of the secured obligations become due and payable, unconditionally pay or
procure the same to be paid on the due date therefor, in the manner provided in the Transaction
Documents. These covenants have effect while amounts remain payable in respect of the secured
obligations.
Form and Issue of Compartment 2 Notes
Each class of Compartment 2 Notes shall be represented initially by a Temporary Global Note. Each
Temporary Global Note will be exchangeable for a Permanent Global Note. Each Global Note shall be
so executed by a person duly authorised by the Issuer on behalf of the Issuer and authenticated by or on
behalf of the Principal Paying Agent and the Global Notes so executed and authenticated shall each be
a binding and valid obligation of the Issuer. The Issuer shall issue Definitive Notes together with the
unmatured Receipts and Coupons attached in exchange for each Global Note in certain prescribed
conditions. Title to the Definitive Notes, the Coupons and the Receipts shall pass by delivery.
The Issuer shall procure that all Compartment 2 Notes which are redeemed in full, surrendered and
replaced pursuant to Condition 21(4) of the Terms and Conditions of the Compartment 2 Notes or
exchanged and all Coupons and Receipts paid in accordance with the Terms and Conditions of the
Compartment 2 Notes or which have been surrendered and replaced shall forthwith be cancelled.
Charge and Assignment
The Issuer with full title guarantee, in favour of the Trustee for the benefit of the Secured Parties has
created a charge and assignment of the Compartment 2 Collateral set out in Condition 3(4) of the
Terms and Conditions of the Compartment 2 Notes to the Trustee for itself and as trustee for the
Secured Parties as continuing security for the payment of the secured obligations.
The security shall be released and reassigned to the Issuer, automatically in certain prescribed
circumstances and provided that the Trustee has not received written notice of the occurrence of an
Event of Default which is continuing, security may also be released upon receipt of a duly completed
issuer order in certain circumstances.
If the purported assignment by way of security is found to be ineffective, the Issuer shall hold the
benefit of such Compartment 2 Collateral and any sums received in respect of such Compartment 2
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Collateral or any security interest, guarantee or indemnity or undertaking of whatever nature given to
secure the Compartment 2 Collateral on trust for the Trustee and the Issuer will be required to take
certain prescribed actions pursuant to the Trust Deed.
The Trustee may borrow money on the security of the Compartment 2 Collateral or any part of it in
order to defray monies, costs, charges, losses and expenses paid or incurred by it in relation to the Trust
Deed or in exercise of any powers contained in the Trust Deed for purposes in connection with the
Trust Deed.
Permitted Investments
Permitted Investments which are capable of being held in the Custody Accounts will be so held by the
Custodian on behalf of the Issuer in the Custody Accounts. Permitted Investments which are not
capable of being held in the Custody Accounts will be deposited directly with the relevant financial
institution offering such Permitted Investments.
Enforcement of Security
The security shall become enforceable following notice being given to the Issuer of an acceleration of
the Issuer's payment obligations under the Compartment 2 Notes, provided that such notice has not
been rescinded or annulled by the Trustee. At any time after the security has become enforceable, the
Trustee may, at its discretion and without further notice in accordance with all applicable laws, institute
such proceedings against the Issuer as it may think fit and, in accordance with all applicable laws
realise and /or otherwise liquidate the Compartment 2 Collateral and/or take such action as may be
permitted under applicable laws against any obligor and/or take such other action to enforce the
security. Only the Trustee may pursue the remedies available under the Trust Deed to enforce the rights
for itself and as trustee for the Compartment 2 Noteholders or of any of the other Secured Parties and in
the event that the security becomes enforceable, the Trustee shall notify, within a reasonable time after
becoming aware of such event, the Cash Administrator, the Agents, the Swap Counterparty, the Issuer
and so long as any of the Senior Notes remain outstanding, the Rating Agencies. All moneys received
by the Trustee upon any enforcement of the security shall be held by the Trustee upon trust to apply
them (subject to the trustee's discretion to invest in Permitted Investments in certain circumstances) in
accordance with the Priority of Payments.
Issuer Covenants
The Issuer has made various covenants with the Trustee for the benefit of the Secured Parties. Amongst
others, the Issuer has covenanted: (a) to give to the Trustee promptly after request, and in any event on
each anniversary of the date of execution of the Trust Deed, a certificate of no default; (b) to procure
that the Principal Paying Agent notify the Trustee forthwith where on or before the due date for
payment of the Compartment 2 Notes, it has not received payment of the full amount of moneys
payable; (c) to give notice to the Trustee of any proposed redemption of the Compartment 2 Notes; (d)
to give or procure that notice is given to the Compartment 2 Noteholders that payment has been made,
unless the Trustee otherwise agrees, in the event of an unconditional payment to the Principal Paying
Agent of any sum due in respect of the Compartment 2 Notes or any of them being made after the due
date for payment; (e) to pay its debts generally as they fall due; (f) to procure that the Cash
Administrator at the Issuer's expense obtain an annual review of the rating of the Senior Notes from the
Rating Agencies; (g) to give the Trustee and the Cash Administrator notice in writing forthwith upon
becoming aware of the occurrence of any Event of Default or potential Event of Default; (h) to notify
the Trustee upon becoming aware that any of the ratings assigned to the Senior Notes has been, or will
be, changed or withdrawn and (i) to maintain or cause to be maintained a Principal Deficiency Ledger.
Restrictions
The Issuer shall not, amongst other restrictions imposed in the Trust Deed, without the prior written
consent of the Trustee and save as contemplated in the Transaction Documents:
(a)
engage in any business other than (i) acquiring and holding the Compartment 2 Collateral and
performing any obligations it may have thereunder; (ii) issuing and performing its obligations
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under the Compartment 2 Notes; (iii) entering into, exercising rights under, performing
obligations under or enforcing its rights under the Transaction Documents; or (iv) performing
any act incidental to or necessary in connection with (i),(ii) and (iii) above;
(b)
have any subsidiaries or employees;
(c)
amend any term or condition of any of the Compartment 2 Notes of any class except in
accordance with the Trust Deed or the Terms and Conditions;
(d)
incur any indebtedness for borrowed money other than in respect of the Compartment 2 Notes
or any document entered into in connection with the Compartment 2 Notes or the sale thereof,
including any Swap Agreement; or
(e)
agree to any amendment to any provision of or grant any waiver or consent under the Trust
Deed and certain other Agreements.
Negative Pledge
The Issuer will not, save as contemplated in the Transaction Documents, without the prior consent in
writing of the Trustee : (a) sell, factor, discount, transfer, assign, lend or otherwise dispose of any of its
right, title or interest in or to the Compartment 2 Collateral nor will it create or permit to be outstanding
any mortgage, pledge, lien, charge, encumbrance or other security interest over the Compartment 2
Collateral other than in accordance with the Trust Deed; or (b) sell, factor, discount, transfer, assign,
lend or otherwise dispose of, nor create or permit to be outstanding any mortgage, pledge, lien, charge,
encumbrance or other security interest over, any of its other property or assets or any part thereof or
interest therein other than in accordance with the Trust Deed.
Notification to the Rating Agencies
(a)
So long as any of the Senior Notes remain Outstanding, the Issuer shall provide to the Rating
Agencies in writing:
(i)
copies of such documents as the Rating Agencies may request which are produced in
respect of any further Compartment 2 Notes issued by, or any other financial
indebtedness incurred by, the Issuer;
(ii)
notice of any amendment to the Terms and Conditions;
(iii)
notice of any removal or resignation of the Trustee, the Cash Administrator or the
Principal Paying Agent or any appointment of a new Trustee or co-Trustee, Cash
Administrator or Principal Paying Agent (which shall satisfy the Rating Requirement
applicable thereto);
(iv)
notice of any removal or resignation of the Custodian or the Account Bank or any
appointment of a new Custodian or Account Bank (which shall satisfy the Rating
Requirement applicable thereto);
(v)
notice of the giving of the payment in full of any class of Compartment 2 Notes
otherwise than upon their scheduled maturity date;
(vi)
notice of any material waiver under or modification made to the Trust Deed or any
Transaction Document and any material waiver to, or consent given by the Trustee in
relation to covenants by the Issuer;
(vii)
notice of the creation of any additional lien or charge in respect of the Compartment 2
Collateral relating to the Compartment 2 Notes which is not permitted by the Trust
Deed and the Terms and Conditions;
(viii) notice of any change to Condition 21 (Final Clauses) of the Terms and Conditions in
respect of any class of Compartment 2 Notes;
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(ix)
notice of any substitution of the Issuer as the primary obligor under any class of
Compartment 2 Notes;
(x)
notice of the occurrence of any default under, or redemption prior to maturity of, any
Permitted Investments;
(xi)
notice of the imposition of any withholding tax on amounts payable to or by the Issuer
in respect of any Profit Participation Agreements or Subordinated Loan Agreements;
(xii)
notice of any disposition or other dealing in its shares and of the proposal or passing of
any resolution to wind up the Issuer;
(xiii) notice of any assignment or delegation by the Cash Administrator pursuant to the Cash
Administration Agreement;
(xiv) any information delivered to the Trustee; and
(xv)
(b)
such other information as the Rating Agencies may reasonably require.
For so long as any of the Senior Notes remain Outstanding, the Issuer will not:
(i)
issue any further Compartment 2 Notes or incur any financial indebtedness, save as
permitted by the Terms and Conditions;
(ii)
appoint any replacement Cash Administrator;
(iii)
substitute any other company for itself as Issuer; or
(iv)
make any change in its place of residence for taxation purposes,
unless the Trustee has received Rating Agency confirmation in respect thereof.
Receiver
To the extent permitted under Luxembourg law, at any time after the security constituted by the Trust
Deed becomes enforceable, the Trustee may appoint any one or more persons to be a receiver of all or
any part of the Compartment 2 Collateral. Every receiver appointed may sell, concur in selling, assign
or release any of the Compartment 2 Collateral without restriction and on such terms as he may think
fit and may effect any such transaction in the name or on behalf of the Issuer or otherwise.
Trustee's Powers and Liabilities
The Trustee may act on the advice or opinion of or any information obtained from any lawyer, valuer,
accountant, surveyor, banker, broker, auctioneer or other expert whether obtained by the Issuer, the
Trustee or otherwise and the Trustee shall not be responsible for any liability occasioned by so acting.
All costs incurred by the Trustee in relation to obtaining such advice, opinion or information shall be
paid by the Issuer.
Save as expressly otherwise provided in the Trust Deed, the Trustee shall have absolute and
uncontrolled discretion as to the exercise of its powers and discretions and shall not be responsible for
any liability which may result from the exercise or non-exercise. The Trustee shall solely have regard
to the interests of the Compartment 2 Noteholders and not the other Secured Parties. The Trustee
assumes no responsibility for the validity, sufficiency or enforceability of the security purported to be
created by the Trust Deed and is not liable for any defects in perfecting the security.
Appointment, Retirement and Removal of Trustee
The power to appoint a new trustee is vested in the Issuer and the appointment must be approved by the
Controlling Class and, if the Controlling Class is a class of Compartment 2 Noteholders, by an
Extraordinary Resolution of the Controlling Class of Compartment 2 Noteholders. At least one trustee
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shall be a trust corporation. A trustee may retire at any time on giving not less than two months' prior
written notice to the Issuer. The Controlling Class may by Extraordinary Resolution remove any trustee
or trustees on not less than 90 days written notice.
Waiver, Authorisation and Determination
The Trustee may, if and in so far as in its opinion the interests of the Compartment 2 Noteholders and
the other Secured Parties shall not be materially prejudiced thereby, waive or authorise any breach or
proposed breach by the Issuer of any of the covenants or provisions contained in the Trust Deed or
determine that any Event of Default or potential Event of Default shall not be treated as such for the
purposes of the Trust Deed or the Terms and Conditions.
Modification
The Trustee may, without the consent of the Compartment 2 Noteholders or the Secured Parties, at any
time and from time to time concur with the Issuer (to the extent applicable) in making any modification
to the Trust Deed if, in the opinion of the Trustee, such modification is of: (a) a formal, minor or
technical nature or to correct a manifest error; or (b) any modification to the Trust Deed (other than
certain specific matters set out in the Trust Deed) and any waiver or authorisation of any breach or
proposed breach of any of the provisions of the Trust Deed which in the opinion of the Trustee it may
be proper to make, provided that the Trustee is of the opinion that such modification will not be
materially prejudicial to the interests of any class of Compartment 2 Noteholders or other Secured
Parties. Any such modification shall be notified by the Issuer to the Rating Agencies so long as any of
the Senior Notes remains outstanding and notified by the Issuer to the Compartment 2 Noteholders as
soon as practicable thereafter. So long as any of the Senior Notes remain outstanding, the Issuer shall
procure that any modification of any of the Terms and Conditions, the Trust Deed or the Cash
Administration Agreement is notified to the Rating Agencies.
Advice
The Trustee shall be entitled to obtain such advice as it sees fit in connection with giving its consent to
any modification, authorisation or waiver and any such advice shall be paid for by the Issuer.
Limited recourse
If the net proceeds of realisation of the security over the Compartment 2 Collateral constituted by the
Trust Deed upon enforcement thereof are less than the aggregate amount payable by the Issuer in
respect of the Compartment 2 Notes and the Trust Deed and to the other Secured Parties (such negative
amount being referred to herein as a "shortfall"), the obligations of the Issuer in respect of the
Compartment 2 Notes, the Trust Deed and its obligations to such Secured Parties will be limited to
such net proceeds which shall be applied in accordance with the Priority of Payments. In such
circumstances, the Issuer will not be obliged to pay, and the other assets (if any) of the Issuer will not
be available for payment of, such shortfall, which shortfall shall be borne by the relevant Compartment
2 Noteholders, the Trustee and other Secured Parties in accordance with the Priority of Payments
(applied in reverse order), the rights of such persons to receive any further amounts in respect of such
obligations shall be extinguished and none of the Compartment 2 Noteholders, the Trustee or the other
Secured Parties may take any further action to recover such amounts.
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Description of the Cash Administration Agreement
The descriptions in this section refer to certain provisions of the Cash Administration Agreement.
These descriptions do not purport to be complete and are subject to, and qualified in their entirety by
reference to, the detailed provisions of the Cash Administration Agreement.
On the Issue Date, the Issuer entered into the Cash Administration Agreement with the Trustee, the
Transaction Adviser, BNP Paribas Securities Services, Luxembourg branch as Cash Administrator and
Calculation Agent and BNP Paribas, Luxembourg branch as Principal Paying Agent, Account Bank
and Custodian.
Issuer Receipts in respect of the Financing Agreements
Pursuant to the Cash Administration Agreement, the Account Bank shall immediately notify each of
the Cash Administrator, the Issuer and the Transaction Adviser upon receipt of any payments of Issuer
Receipts into the Issuer Account which are attributable to the Financing Agreements. Upon receipt of
such notification and, subject as provided below (see "Closed Periods"), the Cash Administrator shall,
at the written direction of the Transaction Adviser, procure that such Issuer Receipts are promptly
invested in such Permitted Investments as are selected by the Transaction Adviser. For the avoidance
of doubt, (i) only Permitted Investments which are capable of being held in the Custody Accounts shall
be so held by the Custodian on behalf of the Issuer in the Custody Accounts and (ii) Permitted
Investments which are not capable of being held in the Custody Accounts shall be deposited directly
with the relevant financial institution offering such Permitted Investments.
Issuer Receipts in respect of Permitted Investments
Pursuant to the Cash Administration Agreement (but subject to the following sentence), all Issuer
Receipts paid to the Issuer which are derived from Permitted Investments which are not held in the
Custody Accounts shall be credited to the Issuer Account. All Issuer Receipts received by the
Custodian which are derived from Permitted Investments which are held by the Custodian in the
Custody Accounts shall initially be credited to the cash account associated with the relevant Custody
Account, whereupon the Custodian shall immediately notify each of the Cash Administrator, the Issuer
and the Transaction Adviser of such receipt and transfer such amounts to the Issuer Account.
The Account Bank shall notify the Cash Administrator upon receiving such amounts so transferred and,
subject as provided below (see "Closed Periods"), the Cash Administrator shall, at the written direction
of the Transaction Adviser, procure that such Issuer Receipts are promptly reinvested in such further
Permitted Investments as are selected by the Transaction Adviser. Permitted Investments which are
capable of being held in the Custody Accounts shall be so held by the Custodian on behalf of the Issuer
in the Custody Accounts.
Other Issuer Receipts
The Account Bank shall immediately notify each of the Cash Administrator, the Issuer and the
Transaction Adviser upon receipt into the Issuer Account of all Issuer Receipts other than those
received in respect the Financing Agreements and Permitted Investments. Upon receipt of such
notification and, subject as provided below (see "Closed Periods"), the Cash Administrator shall, at the
written direction of the Transaction Adviser, procure that such Issuer Receipts are promptly invested in
such Permitted Investments as are selected by the Transaction Adviser.
Closed Periods
Notwithstanding as provided above, the Cash Administrator shall not (and the Transaction Adviser
shall not direct the Cash Administrator to) invest in Permitted Investments any Issuer Receipts which
are received into the Issuer Account within 10 Business Days of a Determination Date. For the
avoidance of doubt, such Issuer Receipts shall remain in the Issuer Account and shall accrue interest
thereon at the rate applicable to the Issuer Account.
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Investment Decision
Any investment in (or liquidation of) Permitted Investments by the Cash Administrator under the Cash
Administration Agreement shall be made in absolute reliance on written instruction so to do from the
Transaction Adviser to the Cash Administrator in accordance with the Cash Administration Agreement,
and the Cash Administrator shall incur no liability as a result of acting in consequence of receipt
thereof
Swap Agreement Collateral
In the event that the Swap Counterparty is required under the terms of the Swap Agreement to post
collateral with the Issuer to secure the Issuer's rights against the Swap Counterparty thereunder
following a downgrade of the Swap Counterparty:
(a)
any collateral so posted by the Swap Counterparty which consists of securities shall be held by
the Custodian in a segregated sub-account of the Custody Accounts; and
(b)
any collateral so posted by the Swap Counterparty which is in the form of cash shall be held
by the Account Bank in a segregated sub-account of the Issuer Account.
Liquidation of Permitted Investments for the Payment of Immediate Operating Expenses and
Recovery Manager Recoveries Fees
During each Due Period, the Cash Administrator, acting upon the instructions of the Transaction
Adviser as set out below, shall liquidate (or, in circumstances where the Cash Administrator is not
ordinarily capable of effecting such liquidation, request that the Transaction Adviser instructs or effect
the liquidation of) sufficient Permitted Investments (the security over which shall be released by the
Trustee in accordance with the Trust Deed) in order to pay when due any Immediate Operating
Expenses and any Recovery Manager Recoveries Fees (each as defined in the Conditions) that become
due and payable during such Due Period.
Where a payment on account of an Immediate Operating Expense or a Recovery Manager Recoveries
Fee is due and payable during a Due Period:
(a)
the Transaction Adviser shall obtain from the relevant payee or the Recovery Manager,
respectively, a certification of the amount so due and payable;
(b)
the Transaction Adviser shall send a copy of such certification to each of the Cash
Administrator, the Trustee and the Issuer (who shall each be entitled to rely on such
certification as to the amount due without further enquiry and without liability); and
(c)
upon receipt of such certification, the Cash Administration shall procure the liquidation of the
required amount of Permitted Investments and procure the payment of the amount due to the
relevant payee or the Recovery Manager, respectively.
Removal of Cash Administrator Without Cause
The appointment of the Cash Administrator pursuant to this agreement may be terminated without
cause at any time, upon 45 days' prior written notice by (a) the Issuer or (b) the Trustee at its discretion
or acting upon the directions of the holders of a majority of the Outstanding Principal Amount of each
class of Compartment 2 Notes, to the Cash Administrator copied to the Issuer or Trustee (as applicable)
and the Transaction Adviser and upon written notice to the Compartment 2 Noteholders in accordance
with Condition 19 (Notices).
Removal of Cash Administrator With Cause
The appointment of the Cash Administrator pursuant to the Cash Administration Agreement may be
terminated, for cause by (a) the Issuer or (b) the Trustee at its discretion or acting upon the directions of
the holders of each Class of Compartment 2 Notes each acting by Ordinary Resolution forthwith upon
prior written notice to the Cash Administrator copied to the Issuer or the Trustee (as applicable) and the
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Transaction Adviser and upon written notice to the Compartment 2 Noteholders in accordance with
Condition 19 (Notices).
For the purposes of determining "cause" with respect to termination of the Cash Administration
Agreement relating to change of the Cash Administrator , such term shall mean any one of the
following events:
(a)
the Cash Administrator shall default in the performance of any of its material duties under the
Cash Administration Agreement and shall not cure such default within 30 days of the
occurrence of such default;
(b)
a court having relevant jurisdiction shall enter a decree or order for relief in respect of the
Cash Administrator in any involuntary case under any applicable bankruptcy, insolvency or
other similar law, or appoint a receiver, liquidator, assignee, custodian, trustee, sequestrator
(or similar official) of the Cash Administrator or for any substantial part of its property, or
order the winding-up or liquidation of its affairs; or
(c)
the Cash Administrator shall commence a voluntary case under applicable bankruptcy,
insolvency or other similar law, or shall consent to the entry of an order for relief in an
involuntary case under any such law, or shall consent to the appointment of or taking
possession by a receiver, liquidator, assignee, trustee, custodian, sequestrator (or similar
official) of the Cash Administrator or in respect of any substantial part of its property, or shall
make any general assignment for the benefit of creditors, or shall fail generally to pay its debts
as they become due.
If either of the events specified in paragraph (b) or (c) above shall occur, the Cash Administrator shall
give written notice thereof to the Issuer, the Trustee and the Transaction Adviser within one Business
Day after the occurrence of such event.
Resignation of Cash Administrator
The Cash Administrator may resign its appointment without cause by giving 90 days' prior written
notice, and with cause by the Cash Administrator giving 10 days' prior written notice to the Issuer, the
Trustee and the Transaction Adviser.
Appointment of Successor Cash Administrator
No termination of the appointment or resignation of the Cash Administrator shall be effective until the
date as of which a successor Cash Administrator reasonably acceptable to the Issuer, the Trustee and
the Transaction Adviser shall have agreed in writing to assume all of the Cash Administrator's duties
and obligations pursuant to the Cash Administration Agreement and notice of such appointment shall
have been given to the Compartment 2 Noteholders in accordance with Condition 19 (Notices). Upon
the termination of the appointment of the Cash Administrator or upon the resignation of the Cash
Administrator, the Transaction Adviser on behalf of the Issuer shall use its best efforts to appoint a
successor Cash Administrator, provided, however, that if within 45 calendar days of the resignation of
the Cash Administrator the Transaction Adviser on behalf of the Issuer has not appointed a successor to
the Cash Administrator, the Cash Administrator may itself appoint a successor Cash Administrator
reasonably acceptable to the Issuer, the Trustee and the Transaction Adviser.
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Description of the Swap Agreement
The descriptions in this section refer to certain provisions of the Swap Agreement. These descriptions
do not purport to be complete and are subject to, and qualified in their entirety by reference to, the
detailed provisions of the Swap Agreement.
The Issuer and HSBC Bank plc as Swap Counterparty entered into the Class A Swap and the Class B
Swap on 11 April 2006.
Pursuant to the Swap Agreement, the Issuer will substantially hedge interest rate exposure resulting
from fixed-rate interest revenue under the Financing Agreements and floating-rate interest obligations
under the Compartment 2 Notes.
Moody's Downgrade Events
In accordance with the Swap Agreement, if the long-term, unsecured and unsubordinated debt
obligations of the Swap Counterparty (or of any party providing credit support to the Swap
Counterparty) are downgraded below "A1" (or its equivalent) by Moody's or the short-term, unsecured
and unsubordinated debt obligations of the Swap Counterparty (or of any party providing credit support
to the Swap Counterparty) are downgraded below Prime-1 (or its equivalent) by Moody's (either, an
"Initial Moody's Rating Event") and this event is continuing, then the Swap Counterparty shall notify
the Issuer and the Trustee accordingly and unless the Swap Counterparty is in receipt of Rating Agency
Confirmation in respect of such event, the Swap Counterparty shall, at its exclusive option and at its
sole cost, within 30 Business Days of such occurrence either (i) transfer all of its rights and obligations
with respect to the Swap Agreement to a replacement third party with the Moody's Required Ratings
(as defined below) domiciled in the same legal jurisdiction as the Swap Counterparty or the Issuer or
such other replacement third party as agreed with Moody's; or (ii) procure another person with the
Moody's Required Ratings (as defined below) domiciled in the same legal jurisdiction as the Swap
Counterparty or the Issuer, or such other person as agreed with Moody's, to become co-obligor or
guarantor in respect of the obligations of the Swap Counterparty under the Swap Agreement; or (iii)
take such other action as agreed with the Issuer, the Trustee and Moody's; or (iv) post collateral in
accordance with the Swap Agreement.
In connection with the Swap Agreement, "Moody's Required Ratings" means, in respect of the
relevant entity, its short-term, unsecured and unsubordinated debt obligations are rated at least as high
as "Prime-1" and its long-term, unsecured and unsubordinated debt obligations are rated at least as high
as "A1", or such other ratings as may be agreed with Moody's from time to time.
Furthermore, if the long-term, unsecured and unsubordinated debt obligations of the Swap
Counterparty (or of any party providing credit support to the Swap Counterparty) are downgraded
below Baa2 (or its equivalent) by Moody's or the short-term, unsecured and unsubordinated debt
obligations of the Swap Counterparty (or of any party providing credit support to the Swap
Counterparty) is downgraded below Prime-2 (or its equivalent) by Moody's or any such rating is
withdrawn by Moody's (a "Subsequent Moody's Rating Event") and such event is continuing, then
unless the Swap Counterparty is in receipt of Rating Agency Confirmation in respect of such event, the
Swap Counterparty shall notify the Issuer and the Trustee accordingly and within 30 Business Days of
the occurrence of such Subsequent Moody's Rating Event at its sole cost and on a best efforts basis
either (i) transfer all of its rights and obligations with respect to the Swap Agreement to a replacement
third party with the Moody's Required Ratings (as defined above) domiciled in the same legal
jurisdiction as the Swap Counterparty or the Issuer or such other person as agreed with Moody's; or (ii)
procure another person with the Moody's Required Ratings (as defined above) domiciled in the same
legal jurisdiction as the Swap Counterparty or the Issuer or such other person as agreed with Moody's,
to become co-obligor or guarantor in respect of the obligations of the Swap Counterparty under the
Swap Agreement; or (iii) take such other action as agreed with the Issuer, the Trustee and Moody's.
Pending compliance with (i), (ii) or (iii) above, the Swap Counterparty shall within 10 Business Days
of the occurrence of such Subsequent Moody's Rating Event post collateral with the Issuer in
accordance with the Swap Agreement.
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A failure by the Swap Counterparty to comply with any of the above-described provisions will
constitute an Additional Termination Event or, depending upon the non-compliance, an Event of
Default (each as defined in the Swap Agreement) giving the Issuer the right to terminate the Swap
Agreement.
Under the Swap Agreement, the Issuer will be able to terminate the Swap Agreement if there is an
Event of Default or a Termination Event (in each case as defined in the Swap Agreement) with respect
to the Swap Counterparty and the Swap Counterparty will be able to terminate the Swap Agreement if
there is an Event of Default or a Termination Event (in each case as defined in the Swap Agreement)
with respect to the Issuer. The Swap Agreement will contain events of default and termination events
common to standard ISDA documentation (including without limitation, in relation to failure to pay,
bankruptcy, illegality, tax) (save for any which are specifically disapplied in respect of either one or
both parties) together with certain additional termination events which include (among others) any
amendment to the Priority of Payments which is made without the prior written consent of the Swap
Counterparty which is materially prejudicial to the Swap Counterparty with respect to its position in the
Priority of Payments, or failure by the Swap Counterparty to take any action required under any rating
downgrade requirements. Following the occurrence of any such event of default or termination event,
the Swap Agreement may be terminated in accordance with the detailed provisions thereof and a single
termination payment may become payable by the Issuer to the Swap Counterparty or by the Swap
Counterparty to the Issuer.
Fitch Downgrade Events:
Pursuant to the Swap Agreement, if on any date neither the Swap Counterparty nor any party providing
credit support to the Swap Counterparty is a Fitch Minimum Rated Entity (as defined below), the Swap
Counterparty will use at its cost its reasonable efforts within 30 days after the occurrence of such event
to (i) provide collateral in the form of cash or Euro-zone Government Securities or both as set out in
the Swap Agreement in support of its obligations under the Swap Agreement which complies with the
Fitch Criteria (as defined in the Swap Agreement) or in such amount as may be agreed with Fitch, (ii)
transfer all of its rights and obligations with respect to the Swap Agreement to a replacement third
party who either is a Fitch Minimum Rated Entity (as defined below) or has at that time such other
lower rating as is commensurate with the rating assigned at that time to the Senior Notes by Fitch (such
third party, a "Fitch Ratings Non-Collateral Cure Entity"), (iii) procure another person who is a
Fitch Rating Non-Collateral Cure Entity to become co-obligor or guarantor in respect of the obligations
of the Swap Counterparty under the Swap Agreement or (iv) take such other action as may be agreed
with Fitch as will result in the then rating by Fitch of the Senior Notes being maintained (each of (ii),
(iii) and (iv) above being a "Fitch Ratings Non-Collateral Cure Event"). Should none of the abovelisted events occur within the 30-day period, an Additional Termination Event (as defined in the Swap
Agreement), giving the Issuer the right to terminate the Swap Agreement, shall be deemed to have
occurred.
In connection with the Swap Agreement, a "Fitch Minimum Rated Entity" means at any time a
person who satisfies both of the following: (1) its short-term, unsecured and unsubordinated debt
obligations are rated at that time at least as high as F1 (or its equivalent) by Fitch; as well as (2) its
long-term, unsecured and unsubordinated debt obligations are rated at that time at least as high as A (or
its equivalent) by Fitch.
If on any date neither the Swap Counterparty nor any party providing credit support to the Swap
Counterparty is a Fitch Level 2 Minimum Rated Entity (as defined below), the Swap Counterparty will
use at its cost its reasonable efforts within 30 days after the occurrence of such event to (i) provide
collateral in the form of cash or Euro-zone Government Securities or both as set out in the Swap
Agreement in support of its obligations under the Swap Agreement which complies with the Fitch
Criteria (as defined in the Swap Agreement) or in such amount as may be agree with Fitch or (ii) cause
a Fitch Ratings Non-Collateral Cure Event. Should none of the above-listed events occur within the
30-day period, an Additional Termination Event (as defined in the Swap Agreement), giving the Issuer
the right to terminate the Swap Agreement, shall be deemed to have occurred.
In connection with the Swap Agreement, a "Fitch Level 2 Minimum Rated Entity" means at any time
a person who satisfies both of the following: (1) its short-term, unsecured and unsubordinated debt
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obligations are rated at that time at least as high as F2 (or its equivalent) by Fitch, as well as (2) its long
term, unsecured and unsubordinated debt obligations are rated at that time at least as high as BBB+ (or
its equivalent) by Fitch.
If on any date neither the Swap Counterparty nor any party providing credit support to the Swap
Counterparty is a Fitch Level 3 Minimum Rated Entity (as defined below), the Swap Counterparty will
use at its cost its reasonable efforts within 30 days after the occurrence of such event to cause a Fitch
Ratings Non-Collateral Cure Event. Should no Fitch Ratings Non-Collateral Cure Event occur within
the 30-day period, an Additional Termination Event (as defined in the Swap Agreement), giving the
Issuer the right to terminate the Swap Agreement, shall be deemed to have occurred.
In connection with the Swap Agreement, a "Fitch Level 3 Minimum Rated Entity" means at any time
a person who satisfies both of the following: (1) its short-term, unsecured and unsubordinated debt
obligations are rated at that time at least as high as investment grade by Fitch; as well as (2) its longterm, unsecured and unsubordinated debt obligations are rated at that time at least as high as investment
grade by Fitch.
Under the Swap Agreement, the Issuer will be able to terminate the Swap Agreement if there is an
Event of Default or a Termination Event (in each case as defined in the Swap Agreement) with respect
to the Swap Counterparty and the Swap Counterparty will be able to terminate the Swap Agreement if
there is an Event of Default or a Termination Event (in each case as defined in the Swap Agreement)
with respect to the Issuer.
Each Swap Agreement will contain events of default and termination events common to standard ISDA
documentation (including without limitation, in relation to failure to pay, bankruptcy, illegality, tax)
(save for any which are specifically disapplied in respect of either one or both parties) together with
certain additional termination events including as a result of or otherwise in connection with any
amendment to the Trust Deed which adversely affects payments to the Swap Counterparty unless the
Swap Counterparty has consented to such amendment or any ratings downgrade requirements.
Following the occurrence of any such event of default or termination event, the Swap Agreement may
be terminated in accordance with the detailed provisions thereof and a single termination payment may
become payable by the Issuer to the Swap Counterparty or by the Swap Counterparty to the Issuer.
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Description of the Investment Advisory Agreement
The description in this section refers to certain provisions of the Investment Advisory Agreement. This
description does not purport to be complete and is subject to, and qualified in its entirety by reference
to, the detailed provisions of the Investment Advisory Agreement.
On the Issue Date, the Issuer, the Trustee and HSBC Trinkaus & Burkhardt KGaA as Transaction
Adviser entered into the Investment Advisory Agreement pursuant to which the Issuer will appoint the
Transaction Adviser to carry out certain duties set forth therein.
The Transaction Adviser is required under the Investment Advisory Agreement to monitor the
performance of the Portfolio Companies by communicating regularly with the Portfolio Companies,
conducting the review of the their annual accounts and other financial information provided to the
Transaction Adviser. The Transaction Adviser is required to monitor and determine the probability of
default rating assigned to each Portfolio Company and to advise the Issuer in the event that such rating
is downgraded below the minimum rating set out in the relevant Financing Agreement. The
Transaction Adviser is under a duty to calculate any amounts owed to the Issuer under the Financing
Agreements, to communicate these amounts to the Issuer and to collect payments under the Financing
Agreements. The Transaction Adviser has the responsibility of supervising the Recovery Manager and
making recommendations to the Issuer concerning an appropriate replacement for the Recovery
Manager in the event that the Recovery Manager is required to resign and to provide such other
assistance as the Issuer may reasonably require concerning the proper administration of the Financing
Agreements. The Transaction Adviser is also obliged to immediately notify the Trustee, the Cash
Administrator and the Swap Counterparty of the occurrence of a Principal Deficiency Event; provided
that, in the case of the Swap Counterparty, the amount of the relevant Principal Deficiency Ledger
Repayment with respect to Class A Notes shall be notified to the Swap Counterparty no later than five
Local Business Days (as defined in the Swap Agreement) prior to the applicable calculation period
under the Class A Swap. In addition, the Transaction Adviser is required to determine on each
Determination Date, the total amount of any Issuer Receipts held by the Issuer or held or invested in
Permitted Investments by the Cash Administrator.
The Transaction Advisor shall have the right to obtain all relevant information and documents from the
Issuer which are necessary for it to discharge its obligations under the Investment Advisory Agreement
and the Issuer is required to provide such information to the Recovery Manager upon request.
The Transaction Adviser and its employees shall not be liable to the Issuer for any error of judgement
or for any loss suffered by the Issuer in connection with the performance of the Transaction Adviser's
services, unless such loss arises from a material breach of the Investment Advisory Agreement by, or
the gross negligence or bad faith of, the Transaction Adviser (or any of its partners or employees) in the
performance of its duties.
The Investment Advisory Agreement remains in effect for a term of 8 years. Notwithstanding this term
it may be terminated earlier under certain limited circumstances described therein.
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Description of the Recovery Management Agreement
The description in this section refers to certain provisions of the Recovery Management Agreement.
This description does not purport to be complete and is subject to, and qualified in its entirety by
reference to, the detailed provisions of the Recovery Management Agreement.
On the Issue Date, the Issuer, the Trustee and mbb Consult GmbH as Recovery Manager entered into
the Recovery Management Agreement pursuant to which the Issuer will appoint the Recovery Manager
to carry out certain duties set forth therein.
The Recovery Manager will be appointed under the Recovery Management Agreement to perform the
services set out in the Recovery Management Agreement. In the event that the Issuer gives written
notice to the Recovery Manager that (i) the rating of a Portfolio Company is downgraded below
"B1.edf" (according to Moody's KMV's RiskCalc™ tool) by Moody's, (ii) a Portfolio Company
commits a payment default under a Financing Agreement or (iii) there has been a material adverse
effect on the ability of any Portfolio Company to perform any of its obligations under a Financing
Agreement to which it is a party, the Recovery Manager shall carry out the following activities:
(a)
an evaluation of the relevant Financing Agreement including a commercial and financial
analysis of the relevant Portfolio Company;
(b)
the preparation of a report addressed to the Issuer on the relevant Portfolio Company
describing certain matters set out in the Recovery Management Agreement;
(c)
the conduct of a search for a potential purchaser of the relevant Financing Agreement and the
preparation of a sales memorandum in the event that the Recovery Manager recommends a
sale and the Issuer consents to such action;
(d)
the carrying out of a restructuring workshop with the management of the relevant Portfolio
Company to determine the possibility of a restructuring of its debts; and
(e)
generally to assist the Issuer in taking any decision concerning any relevant Portfolio
Company that fails to comply with its obligations under a Financing Agreement.
The Recovery Manager and its employees however shall not be liable to the Issuer for any error of
judgement or for any loss suffered by the Issuer in connection with the performance of the Recovery
Manager's services, unless such loss arises from a material breach of the Recovery Management
Agreement by, or from the negligence or bad faith of, the Recovery Manager (or any of its partners or
employees) in the performance of its duties under the Recovery Management Agreement.
The Recovery Management Agreement shall remain in effect until it is terminated by any party to the
Recovery Management Agreement subject to the notice provisions in the Recovery Management
Agreement. Notwithstanding the notice provisions, the Recovery Management Agreement. may be
terminated in certain circumstances described therein.
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Description of the Loan Agreement
On the Issue Date the Issuer entered into the liquidity facility agreement with the Lender.
The terms of the Liquidity Facility Agreement provide for a €2,000,000 revolving credit facility to be
used by the Issuer to make up any shortfall on payments falling due under the Compartment 2 Notes on
any Payment Date resulting from the imposition of German withholding tax on any payments made by
the Portfolio Companies to the Issuer.
Interest will accrue on each advance under the facility on a daily basis from and including the date on
which such advance is made to, but excluding the date of repayment thereof at a rate equal to
EURIBOR plus 0.10 per cent. per annum and will be calculated on the basis of the actual number of
days elapsed and a 360 day year. The Issuer will pay interest accrued on each advance on each
Payment Date and on its Repayment Date (as defined in the Liquidity Facility Agreement).
The Issuer shall repay each advance on the Repayment Date (as defined in the Liquidity Facility
Agreement) together with interest accrued thereon. If the Issuer receives any withholding tax
recoveries, the Issuer shall within one business day of receipt of such withholding tax recoveries pay
such withholding tax recoveries to the Lender in or towards prepayment of each advance.
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Description of the Paying Agency Agreement
The descriptions in this section refer to certain provisions of the Paying Agency Agreement. These
descriptions do not purport to be complete and are subject to, and qualified in their entirety by
reference to, the detailed provisions of the Paying Agency Agreement.
On the Issue Date, the Issuer entered into the Paying Agency Agreement with the Trustee, the
Transaction Adviser, BNP Paribas Securities Services, Luxembourg branch as Calculation Agent and
Cash Administrator, Custom House Administration and Corporate Services Limited as Irish Paying
Agent and BNP Paribas, Luxembourg branch as Principal Paying Agent, Account Bank and Custodian.
Pursuant to the Paying Agency Agreement, the Issuer has appointed the Principal Paying Agent and
Calculation Agent to make certain determinations and authentications and to maintain certain records,
and appoints the Principal Paying Agent to effect payments of interest and principal to the
Compartment 2 Noteholders.
The duties of the Principal Paying Agent include the obligation to maintain a record of (i) the delivery
of all Global Notes, their redemption, cancellation, payment, exchange or replacement; (ii) all
payments made in respect of the Compartment 2 Notes and all exchanges of the Global Notes for
Definitive Notes; (iii) of all certifications received by it in accordance with the provisions of the Global
Notes and all confirmations received by it relating to the cancellation of unmatured Compartment 2
Notes and to make such records available for inspection during usual business at all reasonable times to
the extent permitted by applicable law by the Issuer, any other Paying Agent, the Cash Administrator,
the Transaction Adviser and the Trustee. The Principal Paying Agent will also make available to the
Compartment 2 Noteholders through its specified office, during usual business hours, any documents
sent to the Principal Paying Agent by the Issuer to be made available to the Compartment 2
Noteholders.
Pursuant to the Paying Agency Agreement, the Issuer has also appointed the Account Bank, the
Custodian and the Irish Paying Agent on the terms set out therein. The Account Bank shall maintain
the Accounts and perform such functions with respect thereto as set out in the Paying Agency
Agreement and the Cash Administration Agreement. The Account Bank shall also maintain a system
for tracking the cash flows relating to Issuer Receipts. The Custodian shall establish and maintain the
Custody Accounts and perform such functions with respect thereto as set out in the Paying Agency
Agreement and the Cash Administration Agreement. In accordance with the Paying Agency
Agreement, the duties and responsibilities of the Irish Paying Agent shall be performed only with
respect to such Compartment 2 Notes held by residents of Ireland.
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THE PORTFOLIO COMPANIES
The information contained in this section concerning the Portfolio Companies has been provided by or
is based on information provided by the Portfolio Companies. None of the Managers or other
transaction parties has made any investigation into the matters of, or independently verified the
information provided by, the Portfolio Companies, including into matters or information that would be
considered in connection with the assessment of a qualitative credit rating. Accordingly, none of the
Managers or other Transaction parties makes any representation as to the accuracy or completeness of
the information contained herein or assumes any liability or responsibility for any potential inability of
Portfolio Companies to meet their payment obligations under the Financing Agreements. Potential
Investors should conduct their own investigation concerning the Portfolio Companies.
Portfolio Overview
The Private Portfolio Companies are 41 small and medium-sized private companies located in
Germany and organised under German law. The Public Portfolio Companies are six small and mediumsized companies located in Germany and organised under German law.
The financial information relating to the Portfolio Companies set forth below and used to compile the
aggregated portfolio information below is based on the latest published audited financial statements of
the Portfolio Companies for their respective fiscal years.
Probability of Default Rating
The following presentation of the Portfolio Companies on an aggregated and on an individual basis
refers to certain "probability of default ratings" determined for the Portfolio Companies. The basis on
which the probability of default credit ratings have been assigned to the Portfolio Companies is
Moody's KMV's RiskCalc™ tool ("MKMV"). The assessment of the risk that a debtor will be unable
to meet its obligations when due ("probability of default") generated by MKMV is limited to a
statistical analysis of the audited financial statements provided by the Portfolio Companies. It does not
include any qualitative assessment of the Portfolio Companies such as the market position of its
products and services, its competitive position and the quality of its management. Furthermore, it does
not take into account, on an individual debtor basis, particular risk-enhancing circumstances, such as
the relevant Portfolio Company forming part of a group of companies, a Portfolio Company's
participation in group-wide cash pooling arrangements as a creditor of its affiliate, or the existence of
domination and/or profit and loss absorption agreements under which the Company may be dominated
(i.e., effectively managed and/or integrated with) an affiliate. The statistical analysis involves a
comparison of the financial data provided by a company against benchmark financial ratios generated
by MKMV on the basis of a database of historical financial information of a large number of
companies. The probability of default ratings assigned to the Portfolio Companies using MKMV and
set out in this Offering Circular are therefore not comparable to public ratings assigned by Moody's.
The probability of default ratings assigned using MKMV rely on the accuracy of the financial
statement data provided by the Portfolio Companies. The audited financial statement data provided by
the Portfolio Companies has not been and will not be independently reviewed or verified by either
MKMV, Moody's or any party involved in the Transaction. Neither MKMV, Moody's nor any party to
the Transaction gives any statement as to the accuracy of such audited financial statement data.
Moreover, there can be no assurance that the actual probability that some or all of the Portfolio
Companies become unable to meet their payment obligations prior to the full repayment of the
Compartment 2 Notes is not higher than implied by the probability of default ratings set forth in this
Offering Circular. It is intended that the probability of default ratings of each of the Portfolio
Companies will be updated on an annual basis prior to the Scheduled Redemption Date using MKMV.
The probability of default ratings set forth in this document are therefore subject to change depending
on the future financial information available for the Portfolio Companies.
Financial Information
The financial information upon which the probability of default ratings assigned to the Portfolio
Companies are based and which are reflected in the tables and descriptions below are derived from the
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latest published audited financial statements provided by the Portfolio Companies for their respective
fiscal years. Audited financial results for the Portfolio Companies as of any later date were not
available or completed at the time of preparation of this Offering Circular. As a result, the current
financial status of each Portfolio Company, including its income and assets, may vary from its financial
status as portrayed in this Offering Circular. Any deterioration of a Portfolio Company's financial
condition may adversely affect its ability to make Fixed Interest Payments and Private Portfolio
Company Advance repayments or Interest Payments and Public Portfolio Company Advance
repayments, as the case may be, to the Issuer.
Composition of Portfolio Companies
The Portfolio Companies with respect to which Financing Agreements are acquired by the Issuer have
been selected by the investment board of the Issuer based on the "probability of default credit ratings"
assigned to such Portfolio Companies using MKMV with a view to achieve a certain target average
credit quality and diversification of the portfolio of companies as indicated by the "probability of
default credit ratings" and on the basis of opinions of independent second adviser to the Issuer. Prior to
such selection by the Issuer, the Transaction Adviser had proposed certain companies to the Issuer.
Other than that, none of the parties involved in the transaction has made any investigation into the
matters of the Portfolio Companies, including into matters which would be considered in connection
with the assessment of a qualitative credit rating. Accordingly, none of the parties to the transaction can
assume any liability in connection with the potential inability of Portfolio Companies to meet their
payment obligations under the Financing Agreements.
Reference Entity, Region and Moody's Industry Sector
Reference Entity
Acri.Tec Gesellschaft für ophthalmologische
Produkte mbH
Aluminium Rheinfelden GmbH
August Bünger Bob-Textilwerk GmbH & Co.
KG
Blechformwerke Bernsbach AG
Region
Moody's Industry
BR
Healthcare, Education and Childcare
BW
Mining, Steel, Iron and Non Precious Metals
NW
Textiles and Leather
SN
Automobile
Brinkhof Gruppe Deutschland GmbH
TH
Brüder Mannesmann AG
NW
Carl Sülberg GmbH & Co. KG
NW
DBT Maschinenfabrik Scharf GmbH
NW
Emprise Management Consulting AG
HH
Personal, Food and Miscellaneous
Machinery (Non-Agriculture, Non-Construction, NonElectronic)
Mining, Steel, Iron and Non Precious Metals
Machinery (Non-Agriculture, Non-Construction, NonElectronic)
Electronics
e-m-s new media AG
NW
Broadcasting & Entertainment
Erbe Flachstahl GmbH
EVB Energietechnische Vertriebs- und
Beratungsgesellschaft mbH
F. Kirchhoff AG
NW
Mining, Steel, Iron and Non Precious Metals
NW
Utilities
BY
Buildings and Real Estate
FFK environment GmbH
Formteil- und Schraubenwerk Finsterwalde
GmbH
Gotec Gorschlüter GmbH
BR
Ecological
BR
Mining, Steel, Iron and Non Precious Metals
NW
Automobile
Großkelterei Rötha GmbH
SN
Beverage, Food and Tobacco
Helma Eigenbau AG
HVB Hoch-Vakuum-Beschichtungs GmbH &
Co. KG
NI
Buildings and Real Estate
NW
Containers, Packaging and Glass
Infastaub GmbH
NW
J & A Plastics GmbH
NW
Machinery (Non-Agriculture, Non-Construction, NonElectronic)
Ecological
Julius Boos Jr. GmbH & Co. KG
NW
Textiles and Leather
L&S GmbH & Co. KG
SH
Electronics
140
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Reference Entity
Region
Moody's Industry
M. Dohmen GmbH
NW
Textiles and Leather
Matthies Rauchfleisch
BE
Beverage, Food and Tobacco
Max Aicher GmbH & Co. KG -Konzern-
BY
Mining, Steel, Iron and Non Precious Metals
Meermann Bau- & Invest GmbH
BE
Insurance
mfi Management für Immobilien AG
NOE-Schaltechnik Georg Meyer-Keller GmbH
+ Co. KG
ORWO Net GmbH
NW
Insurance
BW
Mining, Steel, Iron and Non Precious Metals
ST
Broadcasting & Entertainment
Ospig Textil GmbH & Co. KG
HB
Textiles and Leather
Paion AG
NW
Chemicals, Plastics and Rubber
PCC AG
NW
Ecological
Poligrat GmbH
BY
Mining, Steel, Iron and Non Precious Metals
Riemser Arzneimittel AG
MV
Chemicals, Plastics and Rubber
Saltus Technology AG
NW
Schiffsversorgung Rostock GmbH
MV
Mining, Steel, Iron and Non Precious Metals
Machinery (Non-Agriculture, Non-Construction, NonElectronic)
Senator Beteiligungsgesellschaft für
Einrichtungen des Gesundheitswesens und der
Altenpflege GmbH
Sigikid H. Scharrer & Koch GmbH & Co. KG
SH
Healthcare, Education and Childcare
BY
Leisure, Amusement, Entertainment
Sopp Industrie GmbH
NW
Printing and Publishing
Splendid Medien AG
Tectum Consulting für Innovationstechnologie
GmbH & Co. KG
Universal Transporte Michels GmbH & Co.
KG
Vereinigte Verlagsanstalten GmbH -Konzern-
NW
Broadcasting & Entertainment
NW
Personal, Food and Miscellaneous
SH
Cargo Transport
NW
Printing and Publishing
Wego Flexodruck GmbH
BR
Containers, Packaging and Glass
WESCO-Heizungsbedarfs-GmbH & Co. KG
NW
Retail Stores
WIFA Getränke-Logistik GmbH & Co. KG
NW
Beverage, Food and Tobacco
Industry Distribution
Companies
Moody's Sector Name
Notional
Number
%
Mining, Steel, Iron and Non Precious Metals
8
17.02%
46,000,000
16.43%
Textiles and Leather
Machinery (Non-Agriculture, Non-Construction,
Non-Electronic)
Beverage, Food and Tobacco
4
8.51%
23,500,000
8.39%
4
8.51%
30,500,000
10.89%
3
6.38%
16,000,000
5.71%
Broadcasting & Entertainment
3
6.38%
18,500,000
6.61%
Ecological
3
6.38%
22,000,000
7.86%
Containers, Packaging and Glass
2
4.26%
6,000,000
2.14%
Personal, Food and Miscellaneous
2
4.26%
9,000,000
3.21%
Automobile
2
4.26%
11,000,000
3.93%
Electronics
2
4.26%
12,000,000
4.29%
Healthcare, Education and Childcare
2
4.26%
12,000,000
4.29%
Buildings and Real Estate
2
4.26%
13,000,000
4.64%
Chemicals, Plastics and Rubber
2
4.26%
13,000,000
4.64%
Printing and Publishing
2
4.26%
15,500,000
5.54%
Insurance
2
4.26%
16,000,000
5.71%
141
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EUR
%
Companies
Moody's Sector Name
Notional
Number
%
EUR
Cargo Transport
1
2.13%
3,000,000
1.07%
%
Utilities
1
2.13%
3,000,000
1.07%
Leisure, Amusement, Entertainment
1
2.13%
5,000,000
1.79%
Retail Stores
1
2.13%
5,000,000
1.79%
Aerospace and Defense
0
0.00%
0
0.00%
Banking
Personal and Non Durable Consumer Products
(Manufacturing Only)
Diversified/Conglomerate Manufacturing
0
0.00%
0
0.00%
0
0.00%
0
0.00%
0
0.00%
0
0.00%
Diversified/Conglomerate Service
0
0.00%
0
0.00%
Diversified Natural Resources, Precious
0
0.00%
0
0.00%
Finance
0
0.00%
0
0.00%
Farming and Agriculture
0
0.00%
0
0.00%
Grocery
Home and Office Furnishings, Housewares, and
Durable Consumer Products
Hotels, Motels, Inns and Gaming
0
0.00%
0
0.00%
0
0.00%
0
0.00%
0
0.00%
0
0.00%
Oil and Gas
0
0.00%
0
0.00%
Telecommunications
0
0.00%
0
0.00%
Personal Transportation
0
0.00%
0
0.00%
Total
47
100.00%
280,000,000
100.00%
Discrepancies of less than 0.01% were rounded up to reach a sum of 100%.
Regional Distribution of Portfolio Companies
Companies
Federal State/Country
North Rhine-Westphalia
Notional
Number
22
%
46.81%
EUR
146,000,000
%
52.14%
Brandenburg
4
8.51%
18,000,000
6.43%
Bavaria
3
6.38%
22,000,000
7.86%
Baden-Wuerttemberg
3
6.38%
20,000,000
7.14%
Berlin
3
6.38%
12,000,000
4.29%
M. W. Pomerania
2
4.26%
13,000,000
4.64%
Schleswig-Holstein
2
4.26%
11,000,000
3.93%
Saxony
2
4.26%
10,000,000
3.57%
Hamburg
1
2.13%
7,000,000
2.50%
Thuringia
1
2.13%
6,000,000
2.14%
Hesse
1
2.13%
6,000,000
2.14%
Saxony-Anhalt
1
2.13%
3,000,000
1.07%
Lower Saxony
1
2.13%
3,000,000
1.07%
Bremen
1
2.13%
3,000,000
1.07%
Saarland
0
0.00%
0
0.00%
Rhineland-Palatinate
0
0.00%
0
Total
47
100.00%
280,000,000
0.00%
100.00%
Rating Distribution
Companies
KMV RiskCalc .edf Rating
Number
142
17:14\21 April 2006\LONDON\AZW\3917196.08
Notional
%
EUR
%
Aa3.edf
3
6.38%
20,000,000
7.14%
A1.edf
3
6.38%
17,000,000
6.07%
A2.edf
1
2.13%
6,000,000
2.14%
A3.edf
6
12.77%
35,000,000
12.50%
Baa1.edf
8
17.02%
44,500,000
15.89%
Baa2.edf
11
23.40%
60,000,000
21.43%
Baa3.edf
15
31.91%
97,500,000
34.82%
Ba1.edf
0
0.00%
0
0.00%
Ba2.edf
0
0.00%
0
0.00%
Ba3.edf
0
0.00%
0
0.00%
B1.edf
0
0.00%
0
0.00%
B2.edf
0
0.00%
0
0.00%
B3.edf
0
0.00%
0
0.00%
Total
47
100.00%
280,000,000
100.00%
Individual Portfolio Company Information
Acri.Tec GmbH
Acri.Tec GmbH is a limited liability company (Gesellschaft mit beschränkter Haftung) organised under
the laws of Germany. It was founded in 1997 and is headquartered in 16761 Hennigsdorf, Germany.
•
Acri.Tec GmbH sees itself as an innovative development and production company for sterile
ophthalmologic medical products used in ophthalmic microsurgery. Thus, the range of
services includes research, development, production and sale of qualitatively outstanding
medical products in the area of ophthalmologic surgery
•
Acri.Tec GmbH aims to become the leading company in the German speaking region and in
selected export markets in the area of high-quality, innovative and modern products
•
Market leadership has already been established with MICS IOL (*Acri.Smart), Silicone oil
(*Acri.Sil-ol), Drainage systems and Iris-Diaphragmata
•
International market leadership was achieved in 2002 with the MICS IOL *Acri.Smart and the
bifocal twin-set lenses (which were awarded the innovation prize of Berlin and Brandenburg)
The financial statement of Acri.Tec GmbH for its fiscal year ended 31st December 2004 was audited
by Treuhand Union Wirtschaftsprüfung Steuerberatung. Its total number of employees as of 31st
December 2004 was 91. The total assets and total turnover for the fiscal year 2004 were € 7.396 Mio
and € 12.770 Mio, respectively.
Aluminium Rheinfelden GmbH
Aluminium Rheinfelden GmbH is a limited liability company (Gesellschaft mit beschränkter Haftung)
organised under the laws of Germany. It was founded in 1937 and is headquartered in 79618
Rheinfelden, Germany.
•
Aluminium Rheinfelden GmbH is based on three entities:
Rheinfelden Alloys: worldwide technology leader in developing and producing primary
aluminium casting alloys. Some of the most renowned car manufacturers are amongst the
company’s most important clients
Rheinfelden Semis: Producer of slugs for customers in the aluminium tube and aerosol market
Rheinfelden Carbon: Producer of carbon materials for aluminium smelters, silicon production
and ferro-alloys production
143
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•
For production in Asia, Japan, North and South America, Aluminium Rheinfelden GmbH
cooperates with several business partners
The financial statement of Aluminium Rheinfelden GmbH for its fiscal year ended 31st December
2004 was audited by KPMG. Its total number of employees as of 31st December 2004 was 279. The
total assets and total turnover for the fiscal year 2004 were € 53.507 Mio and € 118.665 Mio,
respectively.
August Bünger Bob-Textilwerk GmbH & Co. KG
August Bünger Bob-Textilwerk GmbH & Co. KG is a limited liability company (Gesellschaft mit
beschränkter Haftung) & limited partnership (KG) organised under German law. It was founded in
1867 and is headquartered in 42277 Wuppertal, Germany.
•
August Bünger Bob-Textilwerk GmbH & Co. KG is a leading manufacturer of the whole
range of narrow textiles like tapes for reinforcing seams, seals and edges
•
The know how in application problems enables cross selling from the consumer to the
technical industries
•
The registered trademark Bob is especially known for high quality and service in the home
interior and shoe accessory markets
•
For the DIY retailers in the last 3 years a new range of window treatment was successfully
launched under the registered trademark of windoware
The financial statement of August Bünger Bob-Textilwerk GmbH & Co. KG for its fiscal year ended
31st December 2005 was audited by B&O Bergische Treuhand Wirtschaftsprüfungsgesellschaft. Its
total number of employees as of 31st December 2005 was 131. The total assets and total turnover for
the fiscal year 2005 were € 6.601 Mio and € 15.981 Mio, respectively.
Blechformwerke Bernsbach AG
Blechformwerke Bernsbach AG is a stock corporation (Aktiengesellschaft) organised under the laws of
Germany and was established in 1910. Blechformwerke Bernsbach AG is headquartered in 08315
Bernsbach, Germany.
•
Blechformwerke Bernsbach AG produces motor-vehicle parts such as subassemblies,
prototypes, pressed parts, deep-drawn elements, stampings, fuel tanks and tools for the
automobile industry
•
It also processes cold- and hot-rolled blanks across a wide range of tensile strengths, light
metal materials, stainless steel, non-ferrous materials and profiles
•
Its main customers are for example Audi AG, BMW AG, DaimlerChrysler AG, General
Motors and Volkswagen AG
The financial statement of Blechformwerke Bernsbach AG for its fiscal year ended 31st Dezember
2004 was audited by lucrum Treuhandgesellschaft mbH. The total number of employees as of 2004
was 466. The total assets and total turnover for the fiscal year 2004 were € 52.386 Mio and € 62.754
Mio, respectively.
Brinkhof Gruppe Deutschland GmbH
Brinkhof Gruppe Deutschland GmbH is a limited liability company (Gesellschaft mit beschränkter
Haftung) organised under the laws of Germany. It was founded in 1975 and is headquartered in 99084
Erfurt, Germany.
•
Brinkhof Gruppe Deutschland GmbH is a recruitment agency and a subsidiary of Brinkhof
Group International N.V. Niederlande
144
17:14\21 April 2006\LONDON\AZW\3917196.08
•
It operates in the fields of temporary work and placement service. Brinkhof Gruppe
Deutschland GmbH also conducts complete projects including the provision of specialist staff
and skilled employees in the areas engineering, production, logistics, industry, handcraft,
health care, catering industry, technique and transport. The company co-operates in response
to occasional or structural needs
The financial statement of Brinkhof Gruppe Deutschland GmbH for its fiscal year ended 31st
December 2005 was audited by Ulrich Horn Wirtschaftsprüfer Steuerberater. Its total number of
employees as of 31st December 2005 was 36. The total assets and total turnover for the fiscal year
2005 were € 6.955 Mio and € 24.110 Mio, respectively.
Brüder Mannesmann AG
Brüder Mannesmann AG is a stock corporation (Aktiengesellschaft) organised under the laws of
Germany and was established in 1931. Brüder Mannesmann AG is listed on the stock exchange since
1996 and headquartered in 42859 Remscheid, Germany.
•
Subdivided into two branches: tools as well as valves and pipeline fittings
•
In the tools division Brüder Mannesmann AG concentrates on high-grade hand and electric
tools with own design and quality standards, supplies wholesale companies, do-it-yourself
stores and mail order businesses. It is one of the ten largest importers of tools in Germany and
has a leading position in several product sectors on the market
•
In the Valves and fittings division the company is an independent trading house with knowhow in process technology and outstanding consultancy competence for industrial applications
It co-operates with industrial and engineering companies and plant engineering in the main
markets gas and water supply, sewage disposal, industrial applications
The financial statement of Brüder Mannesmann AG for its fiscal year ended 31st Dezember 2004 was
audited by Morison AG Wirtschaftsprüfungsgesellschaft Frankfurt am Main. The total number of
employees as of 2004 was 140. The total assets and total turnover for the fiscal year 2004 were €
53.501 Mio and € 84.209 Mio, respectively.
Carl Sülberg GmbH & Co.KG
Carl Sülberg GmbH is a limited liability company (Gesellschaft mit beschränkter Haftung) & limited
partnership (KG) organised under German law. It was founded in 1870 and is headquartered in 42857
Remscheid, Germany.
•
The company’s main business is the forming of steel and other materials, e.g. for the
agricultural and automotive industry and blank knifes for the meat mincing machine industry
•
Carl Sülberg GmbH & Co. KG is the world’s oldest producer of it’s core product, forged steel
guards for agricultural harvesting machines, which it constantly evolves for and with a global
clientele
•
Just-in-time delivery is delivered all around the world due to it’s plants in the US, among
others
The financial statement of Carl Sülberg GmbH for its fiscal year ended 30th June 2005 was audited by
Franz-Bernd Daum. The total number of employees as of 2005 was 84. The total assets and total
turnover for the fiscal year 2004 were € 6.377 Mio and € 11.120 Mio, respectively.
DBT Maschinenfabrik Scharf GmbH
DBT Maschinenfabrik Scharf GmbH is a limited liability company (Gesellschaft mit beschränkter
Haftung) and organised under the laws of Germany. It was founded in 1951 and is headquartered in
59075 Hamm, Germany. In February 2006, DBT GmbH has sold DBT Maschinenfabrik Scharf GmbH
to Aurelius Group.
145
17:14\21 April 2006\LONDON\AZW\3917196.08
•
DBT Maschinenfabrik GmbH is a leading solution provider for transport systems in
underground mining
•
The tailor-made systems offer efficient and certified technology for the transport of men,
machinery and material under most difficult conditions like steep gradients, high temperatures
or heavy loads
•
The product range comprises roof- and floor-bounded trap- rail-technology such as self
propelled diesel Monorail, rope-driven Duorails as well as chairlifts and battery powered
inspection vehicles.
•
Its core markets are the world leading Coal- and Ore Mining groups in China, Germany,
Poland, Russia, Africa and America
The financial statement of DBT Maschinenfabrik Scharf GmbH for its fiscal year ended 31st December
2005 was audited by KPMG Deutsche Treuhandgesellschaft AG. Its total number of employees as of
31st December 2005 was 173. The total assets and total turnover for the fiscal year 2005 were € 32.607
Mio and € 37.747 Mio, respectively.
Emprise Management Consulting AG (Holding)
Emprise Management Consulting AG (holding) is a stock corporation (Aktiengesellschaft) organised
under the laws of Germany and was established in 1996. Emprise is headquartered in 22083 Hamburg,
Germany.
•
Emprise aims to be leading consulting company in the IT-niche market
•
Supports the clients for issues concerning the network-strategy and IT-Security, develops and
implements solutions for specific costumer processes (i.e. CRM, customer care & billing,
document-management and maintenance)
•
Holds over-average expertise for clients from the industry (BMW, Siemens), financial
services (Allianz, HVB), public services (Ministry of Environment NRW), telecommunication
(Deutsche Telekom, Vodafone), health care (Kassenärztliche Vereinigung Nordrhein) and
utility sector
The financial statement of Emprise Management Consulting AG for its fiscal year ended 31st
December 2004 was audited by Ebner, Stolz, Mönning GmbH. Emprise total number of employees as
of 31st December 2004 was 172 (approximately 300 including freelancers). The total assets and total
turnover for the fiscal year 2004 were € 14.579 Mio and € 24.469 Mio, respectively.
e-m-s new media AG
e-m-s new media AG is a stock corporation (Aktiengesellschaft) organised under the laws of Germany
and was established in 1999. e-m-s is headquartered in 44287 Dortmund, Germany.
•
e-m-s new media AG is an entertainment company, which operates mainly in the DVD-filmmarket
•
e-m-s new media AG was the first company in Germany which produced a film on a DVD
•
The company combines a comprehensive range of video- and audio-formats
•
It is active in the following business segments:
Sales of movie- and music-DVDs through e-m-s sales GmbH
Screen design, sound editing, authoring and pre-mastering for DVD’s through e-m-s studios
GmbH
146
17:14\21 April 2006\LONDON\AZW\3917196.08
Theatrical distribution of cinema films through 3L Filmverleih
The financial statement of e-m-s new media AG for its fiscal year ended 31st December 2004 was
audited by Rölfs Partner. Its total number of employees as of 31st December 2004 was 21. The total
assets and total turnover for the fiscal year 2004 were € 31.014 Mio and € 14.309 Mio, respectively.
Erbe Flachstahl GmbH
Erbe Flachstahl GmbH is a limited liability company (Gesellschaft mit beschränkter Haftung) and
organised under the laws of Germany. It was founded in 1980 and is headquartered in 58093 Hagen,
Germany. In 1998, it was taken over by August Kirberg GmbH & Co. KG and is part of the Kirberg
group since then.
•
Erbe Flachstahl GmbH converts hot wide strip, alloyed steels, rust-free high-grade steels,
metals and metal alloys. The company’s core business is flat-bar steel from coils
•
The company does not only split, roll and trim, but also analyses ahead of the treatment, i.e. it
determines the chemical and mechanical steel data, such as the quality of the steel, with up-todate technique
•
Most of the materials produced by Erbe Flachstahl GmbH is designed for automotive
engineering and the connected supplying industry
•
Erbe Flachstahl GmbH is certified according to DIN EN ISO 9001:2000 by “Germanischer
Lloyd Certification GmbH“
The financial statement of Erbe Flachstahl GmbH for its fiscal year ended 31st December 2004 was
audited by Hörstmann Weber + Partner GbR. Its total number of employees as of 31st December 2004
was 25. The total assets and total turnover for the fiscal year 2004 were € 1.501 Mio and € 2.933 Mio,
respectively.
EVB Energietechnische Vertriebs- und Beratungsgesellschaft mbH
EVB Energietechnische Vertriebs- und Beratungsgesellschaft mbH is a limited liability company
(Gesellschaft mit beschränkter Haftung) organised under the laws of Germany. It was founded in 1995
and is headquartered in 42553 Velbert, Germany.
•
The company is the only service supplier in the market to offer services along the entire value
chain of utilities
•
Its main services are concentrated in the fields Transmission and Distribution, Meter
Management, Billing of Energy and Customer Relationship Management
•
EVB was the first independent power provider in the German market and is market leader for
energy services in Germany
•
Amongst others, EVB Energietechnische Vertriebs- und Beratungsgesellschaft mbH has been
providing its services to seven of the ten biggest power authorities in the market
•
EVB Energietechnische Vertriebs- und Beratungsgesellschaft mbH has one 100% subsidiary,
EVB Energiedienstleistungs AG, which is covering the Swiss market from of 3902 Brig-Glis,
Switzerland
The financial statement of EVB Energietechnische Beratungsgesellschaft mbH for its fiscal year ended
31st December 2004 was audited by Winkler Scholz Partnerschaft. Its total number of employees as of
31st December 2004 was 194. The total assets and total turnover for the fiscal year 2004 were € 3.140
Mio and € 9.959 Mio, respectively.
147
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F. Kirchhoff AG
F. Kirchhoff AG is a stock corporation (Aktiengesellschaft) organised under the laws of Germany and
was established in 1992. F. Kirchhoff AG is headquartered in 03185 Peitz, Germany.
•
F. Kirchhoff AG acts in three areas in the building business:
•
Construction of roads and runways
•
System and specialised construction: Kirchhoff runs turnkey ready projects, restoration and
bridge reconstruction
•
Processing of sand, gravel, asphalt and concrete
•
F. Kirchhoff has reconstructed the Northern runway of Frankfurt airport
The financial statement of F. Kirchhoff AG for its fiscal year ended 31st December 2004 was audited
by BDO Deutsche Warentreuhand AG. Its total number of employees as of 31st December 2004 was
1135. The total assets and total turnover for the fiscal year 2004 were € 99.350 Mio and € 222.040 Mio,
respectively.
FFK Environment GmbH
FFK Environment GmbH is a limited liability company (Gesellschaft mit beschränkter Haftung)
organised under the laws of Germany. It was founded in 1992 and is headquartered in 03185 Peitz,
Germany.
•
FFK Environment GmbH aims to be a dynamic and innovative company for recycling, waste
management and ecologically sound services. It belongs to Germany’s most efficient waste
disposal companies due to the latest state of the art technical equipment and functioning
logistics structures
•
Providing an efficient closed loop recycling management, the company is operating in the
fields container logistics, waste disposal, professional redevelopment of buildings,
refurbishment and consulting. This includes individual waste disposal solutions for commerce,
trade, industry and communities, waste and thermal processing, raw material extraction,
regulation of inner European waste transports logistics, redevelopment, cleaning and
restructuring of complex industrial fallows
•
As an all-round service business, FFK Environment GmbH also offers winter maintenance
and city cleaning. Even special areas, such as the acquisition, sorting, processing and
exploitation of assorted waste materials for recycling is taken on by an FFK subsidiary
The financial statement of FFK Environment GmbH for its fiscal year ended 31st December 2005 was
audited by HLV Haag Lenz Vieting Liskow Wirtschaftsprüfer. Its total number of employees as of 31st
December 2005 was 69. The total assets and total turnover for the fiscal year 2005 were € 10.117 Mio
and € 20.123 Mio, respectively.
Formteil- und Schraubenwerk Finsterwalde GmbH
Formteil- und Schraubenwerk Finsterwalde GmbH is a limited liability company (Gesellschaft mit
beschränkter Haftung) organised under the laws of Germany. It was founded in 1870 as ReicheltMetallwaren and since 1994 operating within the Friedberg group. Formteil und Schraubenwerk
Finsterwalde GmbH is headquartered in 03228 Finsterwalde, Germany.
•
Formteil- und Schraubenwerk Finsterwalde GmbH is a sister company of August Friedberg
GmbH, headquartered in Gelsenkirchen, Germany. Production centres are based in
Gelsenkirchen, Finsterwalde and Monte Mor, Brazil
148
17:14\21 April 2006\LONDON\AZW\3917196.08
•
Formteil und Schraubenwerk Finsterwalde GmbH provides fasteners like screws, nuts and
washers and customised connecting system solutions for nearly all industry sectors, with the
most important sectors being the car, utility vehicle, wind energy and the steel energy girder
construction sector
The financial statement of Formteil- und Schraubenwerk Finsterwalde GmbH for its fiscal year ended
31st December 2004 was audited by WPT Treuhand Gesellschaft mbH. Its total number of employees
as of 31st December 2004 was 162. The total assets and total turnover for the fiscal year 2004 were €
22.464 Mio and € 21.903 Mio, respectively.
GOTEC Gorschlüter GmbH
GOTEC Gorschlüter GmbH is a limited liability company (Gesellschaft mit beschränkter Haftung)
organised under the laws of Germany. It was founded in 1993 and is headquartered in 42489 Wülfrath,
Germany.
•
The company’s core competence is bonding agent coating and it’s pre-treatment for rubber
metal parts for the automotive industry
•
The service is standardised and offered in five European locations and in the US
•
A modern machinery, consisting of various coating machines, chain automates, fat removing
machines as well as the new phosphating and zinc-nickel line, ensure rational production.
Recently, the company has produced the following parts among others: aluminium column for
Mercedes A-Class, engine mounts for VW Polo, MC Smart etc., chassis bushes for Opel,
Porsche, VW, BMW, Ford etc., conventional engine and gearbox mountings, hydraulic and
pendulum mounts, chassis bushes, spring buffers and washers, suspension sub-frame bearings
and suspension strut and damper mountings
The financial statement of GOTEC Gorschlüter GmbH for its fiscal year ended 31st December 2004
was audited by Dr. Breidenbach Dr. Güldenagel und Partner KG. Its total number of employees as of
31st December 2004 was 450. The total assets and total turnover for the fiscal year 2004 were € 9.089
Mio and € 21.345 Mio, respectively.
Großkelterei Rötha GmbH
Großkelterei Rötha GmbH is a limited liability company (Gesellschaft mit beschränkter Haftung)
organised under the laws of Germany. It was founded in 1882 and is headquartered in 04571 Rötha,
Germany.
•
Großkelterei Rötha GmbH specialises in the production, storage and sales of high quality fruit
juices such as organic juice, other non-alcoholic beverages and not from concentrate
•
The company is one of the oldest fruit juice producers in Germany
•
Großkelterei Rötha has its own raw material processing, particularly for the increasing organic
market
•
The largest customers are among the top ten of the German discounter including trade and
private brands
•
In 2005, the output was 110 Mio. Litres
The financial statement of Großkelterei Rötha GmbH for its fiscal year ended 31st December 2004 was
audited by ADW Prof. Dr. Ditges & Partner GmbH. Its total number of employees as of 31st December
2004 was 96. The total assets and total turnover for the fiscal year 2004 were € 18.878 Mio and €
37.254 Mio, respectively.
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Helma Eigenheimbau AG
Helma Eigenheimbau AG is a stock corporation (Aktiengesellschaft) organised under German law. It
was founded in 1980 and is headquartered in 30916 Isernhagen, Germany.
•
Helma Eigenheimbau AG builds and modernizes turnkey homes of all kinds all over Germany
•
Thereby, it guarantees quality, financial calculability and timeliness at fixed economical prices
– one-stop through fair offerings of contractual partners, optimised building processes, reliable
materials and building quality as well as sound foundation soil
The financial statement of Helma Eigenheimbau AG for its fiscal year ended 31st December 2004 was
audited by M&P Morzynski & Partner GmbH. Its total number of employees as of 31st December 2005
was 80. The total assets and total turnover for the fiscal year 2004 were € 7.087 Mio and € 20.821 Mio,
respectively.
HVB Hoch-Vakuum-Beschichtungs GmbH & Co. KG
HVB Hoch-Vakuum-Beschichtungs GmbH & Co. KG is a limited liability company (Gesellschaft mit
beschränkter Haftung) & limited partnership (KG) organised under the laws of Germany. It was
founded in 1998 and is headquartered in 12623 Berlin, Germany.
•
The company specializes in metallizing of films, non woven products and paper in reel stocks
which are used in the fields of high barrier application, decorative application, antistatic
application and thermal isolation. The company has formed trade partnerships particularly
with partners in the packaging industry
•
The company plans to install a third production line in Berlin
The financial statement of HVB Hoch-Vakuum-Beschichtungs GmbH & Co. KG for its fiscal year
ended 31st December 2005 was audited by Harald Wieser Wirtschaftsprüfer Steuerberater. Its total
number of employees as of 31st December 2005 was 42. The total assets and total turnover for the
fiscal year 2005 were € 4.603 Mio and € 10.739 Mio, respectively.
Infastaub GmbH
Infastaub GmbH is a limited liability company (Gesellschaft mit beschränkter Haftung) organised
under the laws of Germany and was established in 1967. Infastaub GmbH is headquartered in 61287
Bad Homburg v.d.H., Germany.
•
Infastaub GmbH is a sister company of Intensiv-Filter GmbH & Co. KG
•
Infastaub GmbH provides tailor made solutions for industrial dust collection problems and
measures to prevent dust explosions
•
By the use of intelligent local solutions raw materials are extracted and can be returned into
the production process if possible
The financial statement of Infastaub GmbH for its fiscal year ended 31st December 2004 was audited
by Gerd Birkenhagen Wirtschaftsprüfer. Its total number of employees as of 31st December 2004 was
66. The total assets and total turnover for the fiscal year 2004 were € 2.272 Mio and € 11.150 Mio,
respectively.
J&A Plastics GmbH
J&A Plastics GmbH is a limited liability company (Gesellschaft mit beschränkter Haftung) organised
under the laws of Germany and was established in 1968. J&A Plastics GmbH is headquartered in
47800 Krefeld, Germany.
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•
J&A Plastics is a service provider for the plastics processing industry: it has manufacturing
facilities in Germany and abroad and a sales and distribution network in Europe and Asia. It’s
main business areas are compounding and recycling
•
In the recycling area, J&A Plastics feeds back engineering plastics into the production cycle,
having it re-worked into a qualitatively high value compound, and salvages raw materials. The
company’s consultancy services aim to rework and compound waste and refuse so that clients
can re-use up to 100% of the materials
•
With its special product ranges in the Anja-Compounds, J&A Plastics covers the complete
requirements for all applications areas such as building and furniture industries, automobile
manufacture, including innovative design-oriented plastics. Its clientele is predominantly from
the domestic appliance, electrical and automobile industries
•
J&A Plastics also provides individual consultation and service in the areas of compounds,
recycling and laboratory testing
The financial statement of J&A Plastics GmbH for its fiscal year ended 31st December 2005 was
audited by BFS Treuhand GmbH. Its total number of employees as of 31st December 2005 was 80. The
total assets and total turnover for the fiscal year 2005 were € 14.455 Mio and € 26.168 Mio,
respectively.
Julius Boos jr. GmbH & Co. KG
Julius Boos jr. GmbH & Co. KG is limited liability company (Gesellschaft mit beschränkter Haftung)
& limited partnership (KG) organised under the laws of Germany and was established in 1882. Julius
Boos is headquartered in 42277 Wuppertal, Germany.
•
Julius Boos produces knitted and woven elastic narrows at its production plant in Wuppertal
and elastic knitwear at its production facility in Goch, Lower Rhine
•
Julius Boos’ elastic textiles are used in health-care and orthopedics, in industrial production
and for conveyor belts in special machine engineering. The fashion industry uses Julius Boos’
products in seductive and refined lingerie, in exclusive corsetry, in bras, panties, corselets and
bodies, in sportswear for joggers, free climbers, cyclists, riders, swimmers, surfers, gymnasts
and athletes
The financial statement of Julius Boos jr. GmbH & Co. KG for its fiscal year ended 31st December
2004 was audited by Trost Rudoba & sozien Wirtschaftsprüfer Steuerberater. Its total number of
employees as of 31st December 2004 was 210. The total assets and total turnover for the fiscal year
2004 were € 10.0 Mio and € 35.6 Mio, respectively.
L&S GmbH & Co. KG
L&S GmbH & Co. KG is limited liability company (Gesellschaft mit beschränkter Haftung) & limited
partnership (KG) organised under German law. It was founded in 1994 and is headquartered in 25591
Ottenbüttel, Germany.
•
The company’s main business is focused on purchase and sale of all forms of high-quality
entertainment electrics and electronic permission-free products as well as connected activities.
Recently, L&S GmbH & Co. KG has concentrated on multimedia-based products, which are
supposed to determine the company’s future business.
•
L&S GmbH & Co. KG is aiming to be one of the leading vendors of non-food products. It
provides services for leading retail chains, discount grocers, coffee roasters, mails order firms
and specialist shops. It is co-operating with business partners in 19 European countries
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The financial statement of L&S GmbH & Co. KG for its fiscal year ended 31st May 2005 was audited
by Wolfgang Hein. Its total number of employees as of 31st May 2005 was 46. The total assets and
total turnover for the fiscal year 2005 were € 14.942 Mio and € 84.285 Mio, respectively.
M. Dohmen GmbH
M. Dohmen GmbH is a limited liability company (Gesellschaft mit beschränkter Haftung) organised
under the laws of Germany and was established in 1973. M. Dohmen is headquartered in 6534 San
Vittore, Switzerland.
•
With Production facilities in Korschenbroich, Germany, San Vittore, Switzerland and Onsan,
Korea, M. Dohmen GmbH is a manufacturer of disperse, acid, basic and vat dyestuffs for
textile applications and of chemical auxiliaries for textile and leather pre-treatment
•
Strong activities in foreign markets with sales agencies in North America, UK, Italy, Turkey,
Canada, China and Korea
•
Since 2001 Joint Venture with LG Chem Ltd. to increase its activities in Asia - the world's
most important dye market - to 32% (Europe 46%, America 21%, Africa 1%) and its total
market share of the global dye market (volume 4500 million EUR) to 4%. Dohmen’s market
share in the worldwide Disperse dyes market for automotive textiles is now 40%
The financial statement of M. Dohmen GmbH for its fiscal year ended 31st December 2004 was
audited by KPMG. Its total number of employees as of 31st December 2004 was 92. The total assets
and total turnover for the fiscal year 2004 were € 45.643 Mio and € 32.845 Mio, respectively.
Matthies GmbH & Co. Rauch-Fleisch KG
Matthies GmbH & Co. Rauch-Fleisch KG is a limited liability company (Gesellschaft mit beschränkter
Haftung) & limited partnership (KG) organised under German law. It was founded in 1963 and is
headquartered in 13439 Berlin, Germany.
•
Matthies GmbH & Co. Rauch-Fleisch KG specializes in the production of the traditional
German pork meal “Kasseler” (smoked pork chop)
•
It also produces other meat products especially for the convenience-food-industry, such as
pizza toppings, soup ingredients and meat components for instant meal and deep freeze
products
The financial statement of Matthies GmbH & Co. Rauch-Fleisch KG for its fiscal year ended 31st
December 2004 was audited by Alpers & Stenger AG Wirtschaftsprüfungsgesellschaft. Its total number
of employees as of 31st December 2004 was 79. The total assets and total turnover for the fiscal year
2004 were € 9.873 Mio and € 24.124 Mio, respectively.
Max Aicher GmbH & Co. KG
Max Aicher GmbH & Co. KG is a limited liability company (Gesellschaft mit beschränkter Haftung) &
limited partnership (KG) organised under the laws of Germany and was established in 1924. Max
Aicher GmbH & Co. KG is headquartered in 83395 Freilassing, Germany.
•
The Max Aicher GmbH & Co. KG group reconciles the four divisions construction, real
estate, steel and environment
•
In the construction division, the company is particularly active in the South of Germany, with
engineered planning. In the real estate business, the group has got an individual project
development and a recent portfolio of 1200 apartments in Bavaria, 800 apartments in Berlin
and opened trading estates
•
In the steel area, the plants in Germany, Czech Republic, Hungary and Romania produce steel
bars, wired steel and special steel mainly used in the car industry and the technical engineering
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•
The environment division focuses on ecologically and reasonably using waste. Residues, for
instance slag or sludge, are mainly processed for recycling.
The financial statement of Max Aicher GmbH for its fiscal year ended 31st December 2004 was
audited by Dr. S. Zitzelsberger Wirtschaftsprüfer. Its total number of employees as of 31st December
2004 was 2591. The total assets and total turnover for the fiscal year 2004 were € 466.068 Mio and €
887.133 Mio, respectively.
Meermann Bau- & Invest GmbH
Meermann Bau- & Invest GmbH is a limited liability company (Gesellschaft mit beschränkter Haftung)
organised under the laws of Germany and was established in 1978. Meermann Bau- & Invest is
headquartered in 10117 Berlin, Germany.
•
Meermann Bau- & Invest GmbH acts as a holding for Meermann Immobilien GmbH,
Meermann Immobilien NRW GmbH, Regional Hausbau GmbH and Ariel Properties Berlin
GmbH
•
The group is an estate developer and agent for either new or restored buildings. It provides the
whole value chain of the property market and is leading in Berlin-Mitte
•
The company also builds-up complete districts
The financial statement of Meermann Bau- & Invest GmbH for its fiscal year ended 31st December
2005 was audited by MSW Montay-Schulz GmbH. Its total number of employees as of 31st December
2005 was 38. The total assets and total turnover for the fiscal year 2005 were € 59.551 Mio and €
79.347 Mio, respectively.
mfi Management für Immobilien AG
mfi Management für Immobilien AG is a stock corporation (Aktiengesellschaft) organised under
German law. It was founded in 1987 and is headquartered in 45127 Essen, Germany.
•
mfi Management für Immobilien AG manages all kind of projects linked to real estate:
development, planning, realisation, letting and centre management. Objects concerned large
downtown shopping centres – Arcaden – with more than 100 shops, restaurants and service
businesses
•
The company co-operates among others with corporate clients such as banks, open ended
funds and international pension funds
•
It has built for example the Riem Arcaden (Munich), Köln Arcaden, Regensburg Arcaden,
Spandau Arcaden and Schönhauser Allee Arcaden (Berlin)
The financial statement of mfi Management für Immobilien AG for its fiscal year ended 31st December
2005 was audited by Deloitte. Its total number of employees as of 31st December 2005 was 290. The
total assets and total turnover for the fiscal year 2005 were € 44.442 Mio and € 54.188 Mio,
respectively.
NOE Schalungstechnik Georg Meyer-Keller GmbH & Co. KG
NOE Schalungstechnik Georg Meyer-Keller GmbH & Co. KG is a limited liability company
(Gesellschaft mit beschränkter Haftung) & limited partnership (KG) organised under the laws of
Germany and was founded in 1919. NOE Schalungstechnik Georg Meyer-Keller GmbH & Co. KG is
headquartered in 73079 Süssen, Germany.
•
NOE-Schaltechnik puts concrete in shape, whereas keeping costs within limits
•
NOE-Schaltechnik aims to be one of the world's leading suppliers of innovative concrete
formwork technology
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•
It is represented in almost all European countries by its own subsidiaries, joint ventures or
agents. Every new development from NOE is first tested by Johannes KellerBau GmbH+Co
on site. Johannes KellerBau, founded in 1919, belongs to the leading regional construction
companies. Only when successfully passing this test, volume production is started and sales to
the contracting industry undertaken. Another subsidiary company is mobil-bau GmbH which
specializes in the production of cellular rooms for living and working accommodation units
The financial statement of NOE Schalungstechnik Georg Meyer-Keller GmbH & Co. KG for its fiscal
year ended 31st December 2004 was audited by Dr. Breuer+Partner GmbH. Its total number of
employees as of 31st December 2004 was 242. The total assets and total turnover for the fiscal year
2004 were € 40.417 Mio and € 38.420 Mio, respectively.
ORWO Net GmbH
ORWO Net GmbH is a limited liability company (Gesellschaft mit beschränkter Haftung) organised
under the laws of Germany and was founded in 2002. ORWO Net GmbH is headquartered in 06766
Wolfen, Germany.
•
The company runs a laboratory for the production of digital pictures and photo-finishing
products, including the development of modern technologies in picture editing and processing
•
ORWO Net plans to include photo books and photo calendars into its product range in 2006
•
The company offers its B2C-products through pixelnet, ORWO direkt and bildernet
•
In the B2B2C business, ORWO Net co-operates more and more with leading discounters and
drugstores and brands known all over Germany and Europe
The financial statement of ORWO Net GmbH for its fiscal year ended 31st December 2005 was
audited by ANACOR Treuhand GmbH Wirtschaftsprüfungsgesellschaft. The average number of
employees in 2005 was 92. The total assets and total turnover for the fiscal year 2005 were € 9.973 Mio
and € 9.703 Mio respectively.
Ospig Textil GmbH & Co. KG
Ospig Textil GmbH & Co. KG is a limited liability company (Gesellschaft mit beschränkter Haftung)
& limited partnership (KG) organised under German law. Ospig Textil GmbH & Co. KG was founded
in 1945 and is headquartered in 28279 Bremen, Germany.
•
Ospig GmbH & Co. KG manufactures clothes
•
With its own trademarks PADDOCK’S, Racing Horse, Redpoint and TROBECA, Ospig is
focusing on the German speaking market. PADDOCK’S stands for middle-price jeans sold to
specialised trade and stores, Racing Horse is a jeans trademark sold to C&C and consumer
markets, Ospig’s sportswear jacket collection is called Redpoint and TRIBECA is a lifestyle
trademark for women
•
Apart from Germany, the main selling markets are USA, Canada, Japan and China
•
Ospig is a pioneer in producing primarily in Asia, especially China and Hongkong, and later
in Bangladesch. The company proactively supported the initiative to avoid child labour by the
“Verband der Fertigwarenimporteure” (Association of Non-Food Importers)
The financial statement of Ospig Textil GmbH & Co. KG for its fiscal year ended 30th November
2004 was audited by Brunsiek & Partner GmbH. Its total number of employees as of 30th November
2004 was 6285. The total assets and total turnover for the fiscal year 2004 were € 71.939 Mio and €
119.041 Mio, respectively.
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Paion AG
Paion AG is a stock corporation (Aktiengesellschaft) organised under the laws of Germany and listed at
Frankfurt stock exchange since 2005. It was founded in 2000 and is headquartered in 52062 Aachen,
Germany.
•
Paion AG is a biopharmaceutical company aiming to become a leader in developing and
commercialising innovative drugs for the treatment of stroke and other thrombotic diseases for
which there is an unmet medical need
•
The company intends to build an integrated portfolio of drugs by exploiting its core expertise
in identifying compounds with potential in the treatment of stroke and other thrombotic
diseases, licensing or otherwise acquiring these compounds and advancing them through the
clinical development and regulatory approval process
•
The projects producing most of the company’s turnover are focused on the product
development process of the drugs Desmoteplase (being tested for the treatment of cerebral
infarction), Enecadin (neuroprotective drug produced to reduce the damaging effects of
stroke) and Solulin (anticoagulant used for the treatment of stroke and thrombotic diseases)
The financial statement of Paion AG for its fiscal year ended 31st December 2004 was audited by Ernst
& Young Wirtschaftsprüfungsgesellschaft AG. Its total number of employees as of 31st December
2004 was 49. The total assets and total turnover for the fiscal year 2004 were € 25.670 Mio and €
16.952 Mio, respectively.
PCC AG
PCC AG is a stock corporation (Aktiengesellschaft) organised under the laws of Germany and was
established in 1993. PCC AG is headquartered in 47198 Duisburg, Germany.
•
Management holding company
•
Portfolio of enterprises active in the chemical and energy industries and organised in three
divisions as follows:
TRADING: Chemicals, Electricity, Solid Fuels
CHEMICAL PRODUCTION: Chlorine, Polyols, Specialty Chemicals, Household Chemicals,
Herbicides, Bisphenol A
LOGISTICS: Management, Rail and Road transportation
•
The group’s strategy focuses on both the profitable growth of its core activities along the
established value chain and the further diversification of its portfolio relying on existing
competencies
•
Major part of future capital expenditure will be directed to the restructuring, fast growing
Central and Eastern European economies
The financial statement of PCC AG for its fiscal year ended 31st December 2004 was audited by Warth
& Klein Wirtschaftsprüfergesellschaft. The total number of employees as of 2004 was 2829. The total
assets and total turnover for the fiscal year 2004 were € 233.203 Mio and € 684.338 Mio, respectively.
Poligrat GmbH
Poligrat GmbH is a limited liability company (Gesellschaft mit beschränkter Haftung) organised under
the laws of Germany. It was founded in 1978 and is headquartered in 81829 Munich, Germany.
•
Poligrat GmbH provides mechanical production and surface technology in the industries of
electro-technology, medical technology, mechanical engineering, automation technology and
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automobile industry (OEM-Suppliers). In particular, it provides welded constructions, fixture
construction, plant construction, manufacture of individual part and small batches, sheet metal
forming, construction and mounting of components, electrochemical deburring and polishing,
precision manufacturing , cutting by chip removal and laser engraving
•
Poligrat is leading in development and application of special treatments for chemical and
electrochemical refining of metal surfaces for decorative purposes, surfaces without burr and
particles and optimizing of technical and functional attributes
•
Poligrat-methods are used worldwide, the process spectrum contains electropolishing (shining
and satinel), chemical deburring and polishing, pickling and passivation and colouring (of
high-grade steel, titanium and zirkonium)
The financial statement of Poligrat GmbH for its fiscal year ended 30th September 2005 was audited
by Öconomia Treuhandgesellschaft mbH. Its total number of employees as of 30th September 2005
was 118. The total assets and total turnover for the fiscal year 2005 were € 10.856 Mio and € 12.364
Mio, respectively.
Riemser Arzneimittel AG
Riemser Arzneimittel AG is a stock corporation (Aktiengesellschaft) organised under the laws of
Germany and was established in 1910. Riemser Arzneimittel AG is headquartered in 17493 Greifswald
– Insel Riems, Germany, with subsidiaries in Leipzig, Berlin and Gengenbach.
•
Riemser Arzneimittel AG has developed to one of the largest pharmaceutical companies in
Eastern Germany
•
The company is divided into the business units of human and veterinary medicine.
•
In human medicine Riemser Arzneimittel AG has continuously broadened the product range,
which comprises ointments, gels, crèmes, powders, tablets, capsules and liquids. It has
specialised on the production and sales of pharmaceuticals for skin diseases. The R & D focus
is oncology and dermatology. Another important part of the portfolio are gynaecology
products as well as OTC-drugs, cosmeceuticals, dietary supplements and dental
pharmaceuticals.
•
Vaccines, diagnostics, pharmaceuticals and specific dietary supplements belong to the
veterinary portfolio
•
The company will base future growth on biotechnologically developed pharmaceuticals
•
Currently, Riemser Arzneimittel AG is working on five innovations for cancer treatment and
three innovative vaccines for human use. In addition some veterinary vaccines are currently
undergoing registration
•
In research and development the company cooperates with well-known research institutes,
hospitals as well as national and international universities. For example the clinical research is
carried out at the universities of Greifswald, Rostock, Giessen, Mainz, Goettingen, Munich
and Sofia. Other co-operations exist with research organizations such as IPSS Berlin,
GALMED Halle, CONVENTIS AG Rostock, the Charité Berlin as well as the universities in
Vienna and Jena.
The financial statement of Riemser Arzneimittel AG for its fiscal year ended 31st December 2005 was
audited by Deloitte & Touche GmbH. The total number of employees as of 2005 was 350. The total
assets and total turnover for the fiscal year 2005 were € 44.750 Mio and € 43.019 Mio, respectively.
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SALTUS Technology AG
SALTUS Technology AG is a stock corporation (Aktiengesellschaft) organised under the laws of
Germany and was established in 1919. SALTUS Technology AG is headquartered in 42653 Solingen,
Germany.
•
SALTUS AG with his operative companies "SALTUS Max Forst" and "HERING
Präzisionstechnik" is acting as specialised supplier, primarily in the automotive market
segment
•
SALTUS Max Forst designs, manufactures and markets specific tools for industrial use (e.g.
fully automated torque wrenches, which has become a standard in automotive and other mass
production industries)
•
HERING Präzisionstechnik, produces in three plants high-precision components, especially
for international systems supplier in fuel injection technologies
The financial statement of SALTUS Technology AG for its fiscal year ended 31st December 2004 was
audited by Morison AG Wirtschaftsprüfungsgesellschaft. The total number of employees as of 2004
was 315. The total assets and total turnover for the fiscal year 2004 were € 41.426 Mio and € 38.882
Mio, respectively.
Schiffsversorgung Rostock GmbH
Schiffsversorgung Rostock GmbH is a limited liability company (Gesellschaft mit beschränkter
Haftung) organised under the laws of Germany and was established in 1959. Schiffsversorgung
Rostock GmbH is headquartered in 18147 Rostock, Germany.
•
Schiffsversorgung Rostock GmbH belongs to the Kloska group. It’s main business fields are
provision and bonded stores, catering service, logistics, spare parts, repair service and
technical supplies
•
Thereby, Schiffsversorgung Rostock GmbH Offers professional services optimised for
international shipping, cruise line or ferry industries including technical supplies, lifting and
lashing techniques, provisions, catering, canteen ware, work clothes and quality tools
•
Experienced engineers consult and solve problems especially for diesel engine spare part
services
The financial statement of Schiffsversorgung Rostock GmbH for its fiscal year ended 31st December
2004 was audited by GKT Industrie- und Handelstreuhand AG. The total number of employees as of
2004 was 119. The total assets and total turnover for the fiscal year 2004 were € 27.607 Mio and €
34.490 Mio, respectively.
Senator Beteiligungsgesellschaft mbH
Senator Beteiligungsgesellschaft mbH is a limited liability company (Gesellschaft mit beschränkter
Haftung) organised under the laws of Germany and was established in 1988. Senator
Beteiligungsgesellschaft mbH is headquartered in 23552 Lübeck, Germany.
•
Senator Beteiligungsgesellschaft mbH is a private supplier of social services in the field of
care for the elderly
•
It runs 24 establishments in Schleswig-Holstein, Lower Saxony and North Rhine-Westphalia
with recently 2,430 residents
•
The provided services include home and inpatient as well as special care
The financial statement of Senator Beteiligungsgesellschaft mbH for its fiscal year ended 31st
December 2004 was audited by NTG – Norddeutsche Treuhand Gesellschaft mbH. The total number of
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employees as of 2004 was 1225. The total assets and total turnover for the fiscal year 2004 were €
89.758 Mio and € 71.191 Mio, respectively.
Sigikid H. Scharrer & Koch GmbH & Co. KG
Sigikid H. Scharrer & Koch GmbH & Co. KG is a limited liability company (Gesellschaft mit
beschränkter Haftung) & limited partnership (KG) organised under the laws of Germany and was
established in 1856. Sigikid H. Scharrer & Koch GmbH & Co. KG is headquartered in 95511
Mistelbach, Germany.
•
Sigikid H. Scharrer & Koch GmbH & Co. KG is a special textile company for baby and
children articles.
•
Other main areas are trends, living (cushions) and fashion for children and babies
•
The company produces soft materials such as textiles, plush, fleece and velour and uses these
materials to create toys for children sold via catalogues and specialist dealers’ stores
The financial statement of Sigikid H. Scharrer & Koch GmbH & Co. KG for its fiscal year ended 31st
December 2005 was audited by Oberfränkische Revision- und Treuhandgesellschaft mbH. The total
number of employees as of 2005 was 92. The total assets and total turnover for the fiscal year 2005
were € 10.725 Mio and € 12.870 Mio, respectively.
Sopp Industrie GmbH
Sopp Industrie GmbH is a limited liability company (Gesellschaft mit beschränkter Haftung) organised
under the laws of Germany and was established in 1888. Sopp Industrie GmbH is headquartered in
42389 Wuppertal, Germany.
•
Sopp Industrie GmbH manufactures bows according to individual customer needs. It also
produces woven belts with or without print
•
Sopp’s offers individual services in particular for the chocolate manufacturers for rising
customer utility
The financial statement of Sopp Industrie GmbH for its fiscal year ended 31st December 2005 was
audited by Dr. Plaßmann, Plutz & Partner. The total number of employees as of 2005 was 25. The total
assets and total turnover for the fiscal year 2005 were € 3.957 Mio and € 11.077 Mio, respectively.
Splendid Medien AG
Splendid Medien AG is a stock corporation (Aktiengesellschaft) organised under the laws of Germany
and was established in 1974. Splendid is headquartered in 50933 Cologne, Germany. Since September
1999, Splendid is listed at Frankfurt Stock Exchange.
•
Splendid Medien AG is the holding company for its subsidiaries and affiliates covering the
value chain of the film business, notably cinema, video, and DVD, pay TV, free TV and
Video On Demand
•
Splendid is engaged in the distribution of motion pictures for cinema and television, the rental
and sale of videos and DVDs, the dubbing and editing of films in the company’s own studios,
the creation of digital content for DVDs and the Internet and the production of special-interest
films
•
Splendid is cooperating with 20th Century Fox of Germany in the field of motion-picture
theatres and with Warner Home Video GmbH in the video field
The financial statement of Splendid Medien AG for its fiscal year ended 31st December 2004 was
audited by BFJM Bachem Fevers Janßen Mehrhoff GmbH Wirtschaftsprüfungsgesellschaft. Its total
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number of employees as of 31st December 2004 was 56. The total assets and total turnover for the
fiscal year 2004 were € 25.436 Mio and € 23.014 Mio, respectively.
Tectum Consulting für Innovationstechnologie GmbH & Co. KG
Tectum Consulting für Innovationstechnologie GmbH & Co. KG is a limited liability company
(Gesellschaft mit beschränkter Haftung) & limited partnership (KG) organised under the laws of
Germany and was established in 1998. The company is headquartered in 45886 Gelsenkirchen,
Germany.
•
Tectum Consulting für Innovationstechnologie GmbH & Co. KG covers the separately grown
companies CTD, Delfon and Data Contact, aiming to strategically develop the so represented
core competences. The group focuses on the complete Costumer Care Management in the
B2B and B2C area
•
CTD offers the classical inbound-activities with focus on complex and consultation-intensive
products, such as technical network support, knowledgebase management and qualified client
hotline. With native speakers in the international business, the company provides 24/7 service
•
Delfon offers sales concepts for corporate clients including acquisition, customer loyalty
measures, interest qualification, up and cross selling activities, back office services as well as
inbound and outbound activities
•
Data Contact realizes technical infrastructures for client data collection and management such
as hard and software, network services, development and implementation of applications and
databases. The company advises on, creates, establishes and runs call-centers
The company’s financial statement for its fiscal year ended 31st July 2005 was audited by WIRTREUHAND GmbH. Tectum Consulting für Innovationstechnologie GmbH & Co. KG had a total
number of employees of 742 in 2005. The total assets and total turnover for the fiscal year 2005 were €
11.919 Mio and € 20.903 Mio, respectively.
Universal Transporte Michels GmbH & Co. KG
Universal Transporte Michels GmbH & Co. KG is a limited liability company (Gesellschaft mit
beschränkter Haftung) & limited partnership (KG) organised under the laws of Germany and was
established in 1953. The company is headquartered in 33106 Paderborn, Germany.
•
Universal Transporte Michels GmbH & Co. KG is a leading provider of heavy load, bulky
cargo and special transports. It is also offering consulting for transportation problems
•
The company is diversified in transport related industries. In Mosberg near Paderborn it has a
motorway service area
•
The company has got seven subsidiaries in Germany, Poland, Czech Republic, and in addition
a new subsidiary in Romania was founded in 2005.
The company’s financial statement for its fiscal year ended 31st December 2004 was audited by
Mescheder Reese Dalkmann Wiebel. Universal Transporte Michels GmbH & Co. KG had a total
number of employees of 189 in 2004. The total assets and total turnover for the fiscal year 2004 were €
11.702 Mio and € 35.011 Mio, respectively.
Vereinigte Verlagsanstalten GmbH
Vereinigte Verlagsanstalten GmbH is a limited liability company (Gesellschaft mit beschränkter
Haftung) organised under the laws of Germany and was established in 1894. Vereinigte
Verlagsanstalten GmbH is headquartered in 40231 Düsseldorf, Germany.
•
Vereinigte Verlagsanstalten GmbH is one of the leading German media service providers
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•
It produces more than 100 consumer and corporate magazines
•
As a full service agency, VVA’s portfolio includes corporate publishing, corporate design,
public relations, new media, prepress, press and distribution
•
A particular strength of VVA is its one-stop service, from fundamental analysis to complete
editorial- and design services as well as press
The company’s financial statement for its fiscal year ended 31st December 2004 was audited by Ernst
& Young Wirtschaftsprüfungsgesellschaft AG. Its total number of employees as of 31st December
2004 was 489. The total assets and total turnover for the fiscal year 2004 were € 35.321 Mio and €
79.436 Mio, respectively.
Wego Flexodruck GmbH
Wego Flexodruck GmbH is a limited liability company (Gesellschaft mit beschränkter Haftung)
organised under the laws of Germany and was established in 1991. Wego Flexodruck GmbH is
headquartered in 14959 Trebbin, Germany.
•
Producer of printed and unprinted flexible films and labels (wrap around, stretch and shrink)
for packaging in food, non-food articles and beverages
•
Especially laminated films with barrier and high-barrier properties, peelable and sealable
•
Extrusion, printing, laminating, slitting of flat film and tube film in one hand
•
Owning a R&D department for the development of new films and laminate structures
The financial statement of Wego Flexodruck GmbH for its fiscal year ended 31st December 2004 was
audited by Vereidigter Buchprüfer Steuerberater Bernhard Ernst. Its total number of employees as of
31st December 2004 was 78. The total assets and total turnover for the fiscal year 2004 were € 16.177
Mio and € 14.788 Mio, respectively.
WESCO-Heizungsbedarfs-GmbH & Co. KG
WESCO-Heizungsbedarfs-GmbH & Co. KG is a limited liability company (Gesellschaft mit
beschränkter Haftung) & limited partnership (KG) organised under the laws of Germany. It was
founded in 1959 and is headquartered in 57080 Siegen, Germany.
•
WESCO-Heizungsbedarfs-GmbH & Co. KG provides bathroom equipment, heat generation
systems and plumbing trade for private and professional customers
•
Subsidiaries are located in Bergisch Gladbach, Arnsberg, Hofheim-Wallau and Hagen
The financial statement of WESCO-Heizungsbedarfs-GmbH & Co. KG for its fiscal year ended 31st
December 2004 was audited by Kolleß und Partner. Its total number of employees as of 31st December
2004 was 135. The total assets and total turnover for the fiscal year 2004 were € 15.533 Mio and €
31.616 Mio, respectively.
WIFA Getränkelogistik GmbH & Co. KG
WIFA Getränkelogistik GmbH & Co. KG is a limited liability company (Gesellschaft mit beschränkter
Haftung) & limited partnership (KG) organised under the laws of Germany. It was founded in 1951 and
is headquartered in 53773 Hennef, Germany.
•
Until 1998, family Lüttike lead the company as an independent concessionaire for Coca-Cola.
Since 1998, WIFA Getränkelogistik GmbH concentrates in beverage logistics with its
subsidiaries WIFA Getränkelogistik GmbH, Getränke Express, Lütticke Getränke GmbH and
Automaten Scheerer GmbH & Co. KG
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•
The company’s distribution network contains beverage warehouses, schools, canteens, petrol
stations, gastronomy, events, beverage wholesale and retail industry
The financial statement of WIFA Getränkelogistik GmbH & Co. KG for its fiscal year ended 31st
December 2004 was audited by Sonntag & Düchting Treuhand GmbH. Its total number of employees
as of 31st December 2004 was 208. The total assets and total turnover for the fiscal year 2004 were €
18.719 Mio and € 89.962 Mio, respectively.
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THE ISSUER
Establishment, Domicile and Duration
The Issuer was incorporated as a limited liability company registered under the name H.E.A.T.
Mezzanine I-2005 S.A. under the laws of Luxembourg on 12 July 2005 for an unlimited duration. On
20 February 2006, the Issuer changed its name to H.E.A.T Mezzanine S.A.
Principal Activities
The Issuer is a special purpose company incorporated in order to to acquire or assume risks linked to
claims, other assets or obligations of third parties or pertaining to all or part of the activities of third
parties by issuing debt instruments, in particular notes, the value of which is dependent upon such risks
which, in the context of the issue of the Compartment 2 Notes will involve the Issuer acquiring the
Profit Participation Agreements and the Subordinated Loan Agreements and entering into the other
documents described in this Offering Circular.
The principal activities of the Issuer correspond with the business purpose stipulated in its Articles of
Incorporation.
Compartment
The board of directors of the Issuer may create different compartments within the Issuer. Each
compartment shall, unless otherwise provided for in the resolution of the board of directors creating
such compartment, correspond to a distinct part of the assets and liabilities of the Issuer. The
resolution of the board of directors creating a compartment within the Issuer, as well as any subsequent
amendments thereto, shall be binding as of the date of such resolutions against any third party.
As between shareholders and creditors of the Issuer each compartment of the issuer shall be treated as a
separate entity. Rights of shareholders and creditors of the Issuer that (i) have, when coming into
existence, been designed as relating to a compartment or (ii) have arisen in connection with the
creation, the operation or the liquidation of a compartment are, except if otherwise provided for in the
resolution of the board of directors creating the relevant compartment, strictly limited to the assets of
that compartment and such assets shall be exclusively available to satisfy such shareholders and
creditors. Creditors and shareholders of the Issuer whose rights are designated as relating to a specific
compartment of the Issuer shall (subject to mandatory law) have no rights to the assets of any other
compartment.
Unless otherwise provided for in the resolution of the board of directors of the Issuer creating a
compartment, no resolution of the board of directors of the Issuer may be taken to amend the resolution
creating such compartment or take any other decision directly affecting the rights of the shareholders or
creditors whose rights relate to such compartment without the prior approval of the shareholders and
creditors whose rights relate to such compartment. Any decision of the board of directors taken in
breach of this provision shall be void.
On 10 August 2005 the Issuer issued four series of notes in an aggregate principal amount of
€220,000,000 which were issued within the "first" compartment created by the Issuer pursuant to
article 7 of its Articles of Incorporation.
The Compartment 2 Notes will be issued by the Issuer within the Compartment 2 created by the Issuer
pursuant to article 7 of its Articles of Incorporation, the terms of which provide that the claims of any
Compartment 2 Noteholder against the Issuer shall be limited to the relevant assets of the Issuer held
within such Compartment 2. The Issuer may elect to issue new debt securities in the future in which
case it would do so by creating a new compartment for each such issue of debt securities, the holders of
which would only be entitled to claim against the relevant assets of the Issuer contained in such new
compartment.
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Management
The current directors of the Issuer, their respective business addresses and other principal activities at
the date hereof are:
Name
Business Address
Principal Activities Outside the Issuer
Mr. Jürgen Berg
1-7, rue Nina et Julien
Lefèvre, L-2015
Luxembourg
Administrateur Délégué of HSBC Trinkaus
Investment Managers S.A.
Mr. Hans-Joachim
Rosteck
1-7, rue Nina et Julien
Lefèvre, L-2015
Luxembourg
Administrateur Délégué of HSBC Trinkaus &
Burkhardt International S.A.
Mr. Jörg Meier
1-7, rue Nina et Julien
Lefèvre, L-2015
Luxembourg
Administrateur Délégué of HSBC Trinkaus &
Burkhardt International S.A.
Fiscal Year
The Issuer's accounting year begins on 1 January and ends on 31 December of each year.
Auditor
The auditor of the Issuer is PriceWaterhouseCoopers S.à.r.l. having its address at 400, route d'Esch,
B.P. 1443 L-1014 Luxembourg, and is a member of Institut des Réviseurs d`Entreprises.
The audited accounts of the Issuer may be obtained at the Issuer's office at 1-7 rue Nina et Julien
Lefèvre, L-1952 Luxembourg.
Financial Statements
The Issuer will prepare its annual financial statements in accordance with accounting principles
generally accepted in Luxembourg. The first annual financial statements will relate to the period from
12 July 2005, the date of the Issuer's incorporation, until 31 December 2005. See "General
Information" for the availability of the annual statements of the Issuer. The Issuer will not publish any
interim financial statements.
Litigation
The Issuer is not involved in any litigation, arbitration or governmental proceedings which may have
any material adverse effect on the financial position of the Issuer. The Issuer is not aware that any such
proceedings or arbitration proceedings are imminent or threatened, which could adversely affect the
Issuer's business, results of operations or financial condition.
Material Adverse Change
Unless otherwise disclosed in this Offering Circular, there has been no material adverse change in
respect of the financial situation of the Issuer since the date of its incorporation on 12 July 2005.
Capitalisation on the Issue Date
The unaudited capitalisation and indebtedness of the Issuer as at the date of this Offering Circular
adjusted for the issue of the Compartment 2 Notes is as follows:
Indebtedness
Class A Notes
Class B Notes
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………………………..……………..
……………………………..………..
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€218,400,000
€30,800,000
Junior Notes
……………………………..………..
The notes issued within the first compartment of the Issuer
€30,800,000
€220,000,000
Share Capital
Issued and paid-up Share Capital ……………………………..…………..
€31,000*
Total Capitalisation and Indebtedness ……………………………….
€500,031,000
___________________________________________________________________________
*
The Issuer has an issued and paid-up share capital of €31,000 divided into 25,000
shares of €1.24 each.
The Issuer is owned as to 24,999 shares of Euro 1.24 nominal value each by HEAT Mezzanine Holding
GmbH and as to one share of Euro 1.24 nominal value by Stichting PCTIII. HEAT Mezzanine
Holding GmbH is a wholly-owned subsidiary of Stichting PCTIII.
Under the terms of the Transaction Documents and the Issuer's articles of association, the Issuer is
restricted from carrying out any activities other than issuing asset backed securities (and all matters
ancillary thereto).
Save as disclosed above, the Issuer has no loan capital outstanding, has not created shares which have
not been allotted and has no term loans and no other borrowings or indebtedness in the nature of
borrowings nor any contingent liabilities or guarantees.
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THE TRUSTEE
This description of the Trustee does not purport to be a summary of, and is therefore subject to, and
qualified in its entirety by reference to, the detailed provisions of the Trust Deed and the other
Transaction Documents.
BNP Paribas Trust Corporation UK Limited has been appointed as Trustee under the Trust Deed.
BNP Paribas Trust Corporation UK Limited is incorporated under the Companies Act 1985 having
limited liability and is registered with the Companies House of England and Wales with company
number 04042668. It has its registered office at 55 Moorgate, London EC2R 6PA, United Kingdom.
Trustee Fees and Expenses due and payable under the Trust Deed will be paid by the Issuer on each
Payment Date in accordance with the Priority of Payments.
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THE CASH ADMINISTRATOR
This description of the Cash Administrator does not purport to be a summary of, and is therefore
subject to, and qualified in its entirety by reference to, the detailed provisions of the Cash
Administration Agreement and the other Transaction Documents.
BNP Paribas Securities Services, Luxembourg branch has been appointed as Cash Administrator under
the Cash Administration Agreement.
BNP Paribas Securities Services, Luxembourg branch is the Luxembourg branch of BNP Paribas
Securities Services and is registered as a branch under the number B 86862 with the Luxembourg
Registry of Commerce and Trade and registered as a bank in Luxembourg by the Commission de
Surveillance du Secteur Financier. BNP Paribas Securities Services is a French Société Anonyme,
organised under the laws of France, having its registered office at 3 rue d'Antin, 75002 Paris, registered
with the Paris Registre du Commerce et de Sociétés under number B 552 108 011.
The payment of the Cash Administrator's fees, costs and expenses due and payable under the Cash
Administration Agreement will be paid by the Issuer on each Payment Date in accordance with the
Priority of Payments.
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THE SWAP COUNTERPARTY
This description of the Swap Counterparty does not purport to be a summary of, and is therefore
subject to, and qualified in its entirety by reference to, the detailed provisions of the Swap Agreement
and the other Transaction Documents. The information set out below relates only to, and has been
obtained from, HSBC Bank plc. Except for the information set out below, HSBC Bank plc has not been
involved in the preparation of, and does not accept responsibility, for this Offering Circular.
HSBC Bank plc, acting through its office at 8 Canada Square, Level 3, London E14 5HQ, United
Kingdom has been appointed Swap Counterparty under the Swap Agreement.
HSBC Bank plc and its subsidiaries form a UK-based group providing a comprehensive range of
banking and related financial services.
HSBC Bank plc, formerly known as Midland Bank plc, was formed in England in 1836 and
subsequently incorporated as a limited company in 1880. In 1923, the company adopted the name of
Midland Bank Limited which it held until 1982 when it re-registered and changed its name to Midland
Bank plc. During the year ended 31 December 1992, Midland Bank plc became a wholly-owned
subsidiary undertaking of HSBC Holdings plc, whose Group Head Office is at 8 Canada Square,
London E14 5HQ, United Kingdom. HSBC Bank plc adopted its current name, changing from Midland
Bank plc, in the year ended 31 December 1999.
HSBC Holdings plc and its subsidiaries (including HSBC Bank plc) (together, the "HSBC Group") is
one of the largest banking and financial services organisations in the world, with over 9,800 offices in
77 countries and territories in five geographical regions: Europe; Hong Kong SAR; the rest of AsiaPacific, including the Middle East and Africa; North America; and South America. Its total assets at 30
June 2005 were £818 billion. HSBC Bank plc is the HSBC Group's principal operating subsidiary
undertaking in Europe.
The short-term unsecured obligations of HSBC Bank plc are currently rated "A-1+" by S&P, "P-1" by
Moody's and "F1+" by Fitch and the long-term obligations of HSBC Bank plc are currently rated "AA" by S&P, "Aa2" by Moody's and "AA" by Fitch.
The information in this section relates to and has been obtained from the Swap Counterparty. The
delivery of the Offering Circular shall not create any implication that there has been no change in the
affairs of the Swap Counterparty since the date of this Offering Circular, or that the information
contained or referred to in this section is correct as of any time subsequent to the date of this Offering
Circular.
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THE TRANSACTION ADVISER
This description of the Transaction Adviser does not purport to be a summary of, and is therefore
subject to, and qualified in its entirety by reference to, the detailed provisions of the Investment
Advisory Agreement and the other Transaction Documents.
HSBC Trinkaus & Burkhardt KGaA has been appointed as Transaction Adviser under the Investment
Advisory Agreement.
HSBC Trinkaus & Burkhardt KGaA was founded in 1785 and is headquartered at Königsallee 21-23,
40212 Düsseldorf, Germany (with branches in Hamburg, Berlin, Frankfurt, Baden-Baden, Stuttgart and
Munich). HSBC Trinkaus & Burkhardt KGaA has two major shareholders, HSBC Holding (73.5 per
cent.) and Landesbank Baden Württemberg (20.3 per cent.). HSBC Trinkaus & Burkhardt KGaA is a
leading German bank headed by four personal liable partners and focuses on three key strategic
business units: private banking, corporate banking and capital markets.
The Senior Transaction Adviser Fee due and payable under the Investment Advisory Agreement will
be paid by the Issuer on each Payment Date in accordance with the Priority of Payments.
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THE RECOVERY MANAGER
This description of the Recovery Manager does not purport to be a summary of, and is therefore
subject to, and qualified in its entirety by reference to, the detailed provisions of the Recovery
Management Agreement and the other Transaction Documents.
mbb Consult GmbH has been appointed as Recovery Manager under the Recovery Management
Agreement.
mbb Consult GmbH was established in 1997 by associates of the law firm Metzeler van Betteray
Buchalik. The Recovery Manager draws upon its staff's knowledge, specialised competence and many
years of experience to provide support to businesses in distress.
As a management consultancy for medium-sized enterprises, the Recovery Manager specialises in
managing crises and in providing consulting services to enterprises in difficulty, enlisting the services
of the partners in the Recovery Manager's network.
The Recovery Manager's core capabilities include the preparation of restructuring and reorganisation
plans and it frequently acts as temporary management. In addition, the Recovery Manager offers its
clients an array of additional services for restructuring, including, where circumstances warrant,
financial reorganisation plans for companies in insolvency. The Recovery Manager works in tandem
with lawyers from Buchalik Brömmekamp.
The Recovery Manager's headquarters are in Düsseldorf, Germany (with a branch office in Munich)
where a team of MBA graduates, economists, engineers, supported by the lawyers of Buchalik
Brömmekamp, is available to provide consulting to clients throughout Germany. Most of the clients are
medium-sized enterprises. The Recovery Manager has successfully provided consultancy services to
many small businesses, as well as larger listed companies.
The payment of any Recovery Manager Recoveries Fees due and payable under the Recovery
Management Agreement in respect of any Recoveries realised by the Recovery Manager will be paid
by the Issuer upon receipt of such Recoveries. The Ongoing Recovery Manager Fee due and payable to
the Recovery Manager under the Recovery Management Agreement will be paid by the Issuer on each
Payment Date in accordance with the Priority of Payments.
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TAXATION
The statements below regarding taxation are based on the law and practice of the relevant specified
jurisdiction at the date of this Offering Circular and are subject to any subsequent changes in law or
practice (which could be made on a retroactive basis). The following statements do not constitute tax
advice and do not purport to be a comprehensive description of all of the tax considerations that may
be relevant to a decision to purchase, own or dispose of the Compartment 2 Notes and may not apply
equally to all persons. Prospective purchasers of the Compartment 2 Notes are advised to consult their
own tax advisers concerning the tax consequences of their ownership of the Compartment 2 Notes.
Luxembourg
Prospective purchasers of the Compartment 2 Notes are advised to consult their own tax advisers as to
the consequences under the tax laws of the country of which they are residents of a purchase of the
Compartment 2 Notes, including, but not limited to, the consequences of the receipt of interest and the
sale of the Compartment 2 Notes. The following is a general description of certain tax laws relating to
the Compartment 2 Notes as in effect and as applied by the relevant tax authorities on the date hereof
and does not purport to be a comprehensive discussion of the tax treatment of the Compartment 2
Notes.
Luxembourg tax position of the Issuer
The Issuer is subject to the tax regime applicable in Luxembourg for securitisation vehicles as
implemented by the Law of 22 March 2004 (the "Law").
Should the capital of the Issuer be increased, it would benefit from an exemption from Luxembourg
proportional capital duty and would only be subject to a capital duty of €1,250.
The Issuer is subject to Luxembourg corporate income tax and municipal business tax at the aggregate
rate of 29.63 per cent. Its taxable basis may however be reduced to nil by way of deduction of interest
paid to the Compartment 2 Noteholders and other deductible expenses (including dividends, if any,
paid to investors).
The Issuer is exempt from Luxembourg net wealth tax.
The Issuer will, in principle, benefit from the double tax treaties concluded by Luxembourg as a
Luxembourg resident company. It should however be verified when invoking a Tax Treaty whether the
other contracting state takes the same position under its interpretation of the Tax Treaty.
Luxembourg tax residency of the Compartment 2 Noteholders
A Compartment 2 Noteholder will not become resident, or be deemed to be resident, in Luxembourg
by reason only of the holding of the Compartment 2 Notes, or the execution, performance, delivery
and/or enforcement of the Compartment 2 Notes.
Withholding tax
Under the Law, there is no withholding tax for Luxembourg resident and non-resident Compartment 2
Noteholders on payments of interest (including accrued but unpaid interest). There is also no
Luxembourg withholding tax payable on payments received upon repayment of the principal or upon
redemption of the Compartment 2 Notes.
Luxembourg withholding tax on payments to individual Compartment 2 Noteholders (resident in
another EU country than Luxembourg) is required to be made by Luxembourg paying agents pursuant
to the laws of 21 June 2005 implementing European Council Directive 2003/48/EC.
Under this Directive, Member States are required from 1 July 2005 to provide to the tax authorities of
other Member States details of payments of interest and other similar income paid by a paying agent
(within the meaning of the Directive) to (or under certain circumstances, to the benefit of) an individual
in another Member State, except that Austria, Belgium and Luxembourg will instead impose a
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withholding system for a transitional period unless the beneficiary of the interest payments elects for
the exchange of information. The withholding tax rate will initially be 15 per cent., increasing steadily
to 20 per cent. and to 35 per cent. The ending of such transitional period depends on the conclusion of
certain other agreements relating to information exchange with certain other countries.
Interest payments made to Luxembourg individual residents are subject to a final 10 per cent
withholding tax.
Taxation of the Compartment 2 Noteholders
Taxation of Luxembourg non-residents
Except for natural persons resident in the EU (see above) Compartment 2 Noteholders who are nonresidents of Luxembourg and who have neither a permanent establishment nor a fixed base of business
in Luxembourg with which the holding of the Compartment 2 Notes is connected are not liable to any
Luxembourg income tax, whether they receive payments of principal, payments of interest (including
accrued but unpaid interest), payments received upon the redemption of the Compartment 2 Notes, or
realise capital gains on the sale of any Compartment 2 Notes.
Taxation of Luxembourg residents - General
Compartment 2 Noteholders who are residents of Luxembourg, or non-resident Compartment 2
Noteholders who have a permanent establishment or a fixed base of business in Luxembourg with
which the holding of the Compartment 2 Notes is connected, must, for income tax purposes, include
any interest received in their taxable income unless each interest has borne the final 10 per cent
domestic withholding tax referred to above. They will not be liable to any Luxembourg income tax on
repayment of principal.
Luxembourg resident individuals
Luxembourg resident individual Compartment 2 Noteholders or non-resident individual Compartment
2 Noteholders who have a fixed base of business with which the holding of the Compartment 2 Notes
is connected are not subject to taxation on capital gains upon the disposal of the Compartment 2 Notes,
unless the disposal of the Compartment 2 Notes precedes the acquisition of the Compartment 2 Notes
or the Compartment 2 Notes are disposed of within six months of the date of acquisition of these
Compartment 2 Notes. Upon redemption of the Compartment 2 Notes, individual Luxembourg resident
Compartment 2 Noteholders or non-resident Compartment 2 Noteholders who have a fixed base of
business with which the holding of the Compartment 2 Notes is connected must however include the
portion of the redemption price corresponding to accrued but unpaid interest in their taxable income.
Luxembourg resident companies
Luxembourg resident companies (sociétés de capitaux) Compartment 2 Noteholders or foreign entities
of the same type which have a permanent establishment in Luxembourg with which the holding of the
Compartment 2 Notes is connected, must include in their taxable income the difference between the
sale price (including accrued but unpaid interest) and the lower of the cost or book value of the
Compartment 2 Notes sold or converted.
Luxembourg resident companies benefiting from a special tax regime
Compartment 2 Noteholders who are holding companies subject to the law of 31 July 1929 or
undertakings for collective investment subject to the law of 20 December 2002 are tax exempt entities
in Luxembourg, and are thus not subject to any Luxembourg tax other than the subscription tax
calculated on their share capital or net asset value (i.e., corporate income tax, municipal business tax
and net wealth tax).
Net Wealth Tax
Luxembourg net wealth tax will not be levied on a Compartment 2 Noteholder, unless (i) such
Compartment 2 Noteholder is a Luxembourg resident or (ii) the Compartment 2 Notes are attributable
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to an enterprise or part thereof which is carried on in Luxembourg through a permanent establishment
or (iii) the Compartment 2 Notes are attributable to a fixed base of business in Luxembourg of the
Compartment 2 Noteholder.
Other Taxes
There is no Luxembourg registration tax, stamp duty or any other similar tax or duty payable in
Luxembourg by Compartment 2 Noteholders as a consequence of the issuance of the Compartment 2
Notes, nor will any of these taxes be payable as a consequence of a subsequent transfer, redemption or
exchange of the Compartment 2 Notes.
There is no Luxembourg value added tax payable in respect of payments in consideration for the
issuance of the Compartment 2 Notes or in respect of the payment of interest or principal under the
Compartment 2 Notes or the transfer of the Compartment 2 Notes. Luxembourg value added tax will,
however, be payable in respect of fees charged for certain services rendered to the Issuer, if for
Luxembourg value added tax purposes such services are rendered or are deemed to be rendered in
Luxembourg and an exemption from Luxembourg value added tax does not apply with respect to such
services. Under Luxembourg VAT law, fees for management services rendered to Luxembourg
securitisation companies are exempt from Luxembourg VAT.
No gift, estate or inheritance taxes is levied on the transfer of the Compartment 2 Notes upon death of a
Compartment 2 Noteholder in cases where the deceased was not a resident of Luxembourg for
inheritance tax purposes.
Federal Republic of Germany
The following summary of certain German income tax considerations for prospective purchasers of the
Compartment 2 Notes is based on the effective tax law at the date of this Offering Circular which may
be changed, even with retroactive effect. The summary does not describe all tax considerations that
may be relevant to an individual purchaser's decision to purchase Compartment 2 Notes. It is not a
substitute for tax advice.
The Junior Notes, especially due to the uncertainty regarding the respective interest payments and the
repayment of the invested amounts the Junior Notes should qualify as financial innovation
(Finanzinnovation) in the meaning of Section 20 para. 2 no. 4 of the German Income Tax Act
(Einkommensteuergesetz). This qualification results in a tax treatment as laid out in this summary. This
characterization should also apply to the Senior Notes, especially since the repayment of the invested
amounts depends on the availability of funds of the Issuer. It is, however, not possible to predict
reliably whether or not the competent tax authorities will share this view. Should the Compartment 2
Notes not qualify as financial innovation in the aforementioned meaning according to the view of the
tax authorities, a different tax treatment may apply. The Compartment 2 Notes should not be subject to
taxation pursuant to the German Investment Tax Act (Investmentsteuergesetz).
Prospective purchasers of Compartment 2 Notes are advised to consult their own tax advisors for
the tax consequences of the purchase, the ownership and the disposition of Compartment 2
Notes, including the effect of any state or local taxes under the tax laws of Germany as well as in
each other country of which they are residents. This particularly applies in case the prospective
purchaser of the Compartment 2 Notes is a shareholder of a portfolio company or an affiliate of
such shareholder.
Tax Residents
Interest Payments
Interest, including interest having accrued up to the disposition of a Compartment 2 Note and credited
separately ("Accrued Interest") paid to a Compartment 2 Noteholder resident in Germany (a person
whose residence, habitual abode, statutory seat, or place of effective management and control is located
in Germany) is subject to German personal or corporate income tax. On the basis of the assessed
personal or corporate income tax solidarity surcharge of 5.5 per cent. is levied. In addition, if
Compartment 2 Notes are held as assets of a German commercial business, any interest is subject to
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trade tax. If Compartment 2 Notes are held as a non-business asset, any Accrued Interest paid upon the
acquisition of Compartment 2 Notes may give rise to negative income and may, therefore, reduce such
Compartment 2 Noteholder's personal or corporate income tax liability.
If Compartment 2 Notes are held in a custodial account which the Compartment 2 Noteholder
maintains with the German branch of a German or non-German bank or financial services institution
(inländische Zahlstelle) (the "Disbursing Agent") such Disbursing Agent will withhold tax
(Zinsabschlag) at a rate of 30 per cent. of the gross amount of all interest payments to the Compartment
2 Noteholder, including Accrued Interest, plus 5.5 per cent. Solidarity surcharge thereon. As a result,
31.65 per cent. of the gross amount of interest, including Accrued Interest, paid to a Compartment 2
Noteholder will be withheld by the Disbursing Agent. If Compartment 2 Notes are not held in a
custodial account (Tafelgeschäft), the Disbursing Agent will withhold tax (Zinsabschlag) at the higher
rate of 35 per cent. which, together with the solidarity surcharge of 5.5 per cent. thereon, results in an
effective tax rate of 36.925 per cent. of the gross amount of interest, including Accrued Interest, paid to
a Compartment 2 Noteholder.
The tax withheld by the Disbursing Agent will be credited against the Compartment 2 Noteholder's
total annual tax burden for German personal or corporate income tax purposes. No tax is withheld by
the Disbursing Agent if the Compartment 2 Noteholder is an individual who has filed a certificate of
exemption (Freistellungsauftrag) with the Disbursing Agent and the Compartment 2 Notes held by
such individual are not part of a German commercial business property or generate income from the
letting and leasing of property. However, this exemption applies only to the extent that the aggregate
interest income derived from the Compartment 2 Notes, together with an individual's other investment
income administered by the Disbursing Agent, does not exceed the maximum annual exemption
amount shown on the certificate of exemption (up to A1,370 for individuals and A2,740 for married
couples filing jointly). No withholding obligation exists also, if the Compartment 2 Noteholder submits
to the Disbursing Agent a certificate of non-assessment (Nichtveranlagungsbescheinigung) issued by
the local tax office.
Sale or Redemption of Compartment 2 Notes
Gains from the sale or redemption of Compartment 2 Notes, including gains derived by a secondary or
subsequent purchaser, are considered as interest and are subject to personal or corporate income tax as
well as solidarity surcharge at a rate of 5.5 per cent. thereon. If Compartment 2 Notes are held as assets
of a German commercial business, such gains are subject to trade tax also. The taxable gain from the
sale or redemption of Compartment 2 Notes is calculated as the difference between the proceeds from
the sale or redemption and the purchase price of the Compartment 2 Notes (so-called Marktrendite).
If the Compartment 2 Notes are held in a custodial account maintained with a Disbursing Agent, tax is
deducted at a rate of 30 per cent. (plus solidarity surcharge of 5.5 per cent. thereon) from the excess of
the proceeds arising from the sale or redemption over the purchase price paid for the Compartment 2
Notes, if the Compartment 2 Notes were held in custody with such Disbursing Agent since the
acquisition. If custody has changed since the acquisition of the Compartment 2 Notes, this tax
deduction will be due on an amount equal to 30 per cent. of the proceeds arising from the sale or
redemption of the Compartment 2 Notes. In computing the tax to be withheld, the Disbursing Agent
may deduct from the basis of the withholding tax any Accrued Interest previously paid during the
calendar year by the Compartment 2 Noteholder to the Disbursing Agent. If the sale or redemption
involves Compartment 2 Notes not kept in a custodial account (Tafelgeschäft), the tax deduction will
be imposed at a rate of 35 per cent. (plus solidarity surcharge of 5.5 per cent. thereon) on an amount
equal to 30 per cent. of the sales or redemption proceeds. The tax deduction will be credited against the
Compartment 2 Noteholder's annual tax liability for personal or corporate income tax purposes. No tax
will be withheld if the Compartment 2 Noteholder is an individual whose Compartment 2 Notes neither
form part of the property of a German business nor give rise to income from the letting and leasing of
property and who filed a certificate of exemption (Freistellungsauftrag) with the Disbursing Agent to
the extent that the interest income derived from the Compartment 2 Notes together with other
investment income does not exceed the maximum exemption amount shown on this certificate (see
"Interest Payments" above). The same applies if the Compartment 2 Noteholder submits to the
Disbursing Agent a certificate of non-assessment (Nichtveranlagungsbescheinigung) issued by the
local tax office.
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Should the Compartment 2 Notes – contrary to the belief of the Issuer (see above) – not qualify as a
financial innovation, gains from the sale or redemption of the Compartment 2 Notes (other than
Accrued Interest and certain other amounts) may be tax free, if the Compartment 2 Notes are held by
private investors and if the time period between the acquisition and the sale or redemption of the
Compartment 2 Notes exceeds one year. In this case, losses may not be tax deductible.
Non-Residents
Interest, including Accrued Interest, paid to a Compartment 2 Noteholder not resident in Germany will
not be taxable in Germany, and no tax will be withheld (even if the Compartment 2 Notes are kept with
a Disbursing Agent) so long as that the Compartment 2 Notes are not held as a business asset of a
German permanent establishment of the Compartment 2 Noteholder and the interest income of such
Compartment 2 Notes does not otherwise constitute German source income (such as income from the
letting and leasing of certain German situs property). Otherwise, the Compartment 2 Noteholder not
resident in Germany will be subject to a tax regime similar to that described above under "Tax
Residents."
Notwithstanding the rules explained in the preceding paragraph, a tax deduction will be imposed, by
the German Disbursing Agent, if any, at rate of 35 per cent. (plus solidarity surcharge of 5.5 per cent.
thereon) of the gross amount paid, if the interest is paid on Compartment 2 Notes not kept in a
custodial account (Tafelgeschäft). If Compartment 2 Notes are sold or redeemed that are not kept in a
custodial account, a tax deduction will be imposed, by the German Disbursing Agent, if any, at a rate
of 35 per cent. (plus solidarity surcharge thereon at a rate of 5.5 per cent.) of an amount equal to 30 per
cent. of the proceeds arising from the sale or redemption of the Compartment 2 Notes.
Thin capitalisation rules
Should any purchaser of the Compartment 2 Notes be a person holding shares in a Portfolio Company
or a party related to such person (nahestehende Person) within the meaning of Section 1 para. 2 of the
German Foreign Tax Act (Außensteuergesetz), the fiscal authorities might take the position that the thin
capitalisation rules set forth in Section 8a of the German Corporate Income Tax Act
(Körperschaftsteuergesetz) will apply which could have adverse effects on the Portfolio Companies in
which such shares are held and the equity holders of such Portfolio Companies. Prospective purchasers
holding shares in a Portfolio Company or being a party related to such shareholders are urged to
consult their tax advisors.
Inheritance and Gift Tax
The receipt of Compartment 2 Notes in case of succession upon death, or by way of a gift among living
persons is subject to German inheritance and/or gift tax if the deceased, donor and/or the recipient is a
German resident. German inheritance and gift tax is also triggered if neither the deceased, nor the
donor nor the recipient are German tax residents, if the Compartment 2 Notes are attributable to
German business activities and if for such business activities a German permanent establishment is
maintained or a permanent representative is appointed in Germany. In specific situations German
expatriates that were tax resident in Germany may be subject to Inheritance and Gift Tax. Double
taxation treaties may provide for exceptions to the domestic inheritance and gift tax regulations.
Other Taxes
No stamp, issue, registration or similar direct or indirect taxes or duties will be payable in Germany in
connection with the issuance, delivery or execution of the Compartment 2 Notes. Currently, net assets
tax is not levied in Germany.
Withholding Tax
Under German law in force as at the date of this Offering Circular, the Portfolio Companies will be
required to deduct German withholding tax in an amount equal to 26.375 per cent. of any interest
payments made under the Financing Agreements. Under the terms of the Germany/Luxembourg
double taxation treaty, the Issuer is entitled to and shall as soon as reasonably practicable after the Issue
Date, apply to the German tax authorities for refund of such withholding tax deduction.
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EU Directive on the Taxation of Savings Income
On 1 July 2005 a new EU directive regarding the taxation of savings income payments came into
effect. The directive obliges a Member State to provide to the tax authorities of another Member State
details of payments of interest or other similar income payments made by a person within its
jurisdiction for the immediate benefit of an individual or to certain non-corporate entities resident in
that other Member State (or for certain payments secured for their benefit). However, Austria, Belgium
and Luxembourg have opted out of the reporting requirements and are instead applying a special
withholding tax for a transitional period in relation to such payments of interest, deducting tax at rates
rising over time to 35 per cent. This transitional period commenced on 1 July 2005 and will terminate
at the end of the first fiscal year following agreement by certain non-EU countries to the exchange of
information relating to such payments.
Also with effect from 1 July 2005, a number of non-EU countries and certain dependent or associated
territories of Member States have adopted similar measures (either provision of information or
transitional withholding) in relation to payments of interest or other similar income payments made by
a person in that jurisdiction for the immediate benefit of an individual or to certain non-corporate
entities in any Member State. The Member States have entered into reciprocal provision of
information or transitional special withholding tax arrangements with certain of those dependent or
associated territories. These apply in the same way to payments by persons in any Member State to
individuals or certain non-corporate residents of those territories.
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SUBSCRIPTION AND SALE
Pursuant to a subscription agreement dated 11 April 2006 (the "Subscription Agreement") between
the Issuer, the Trustee and HSBC Bank plc and Trinkaus (the "Initial Purchasers"), the Initial
Purchasers have agreed to subscribe for the aggregate principal amount of €218,400,000 Class A Notes
at the price of 100 per cent. of their principal amount, the aggregate principal amount of €30,800,000
Class B Notes at the price of 100 per cent. of their principal amount and the aggregate principal amount
of €30,800,000 Junior Notes, each at the price of 100 per cent. of their principal amount.
The Issuer has undertaken to indemnify and hold harmless the Initial Purchasers of any liability
incurring in the context of the subscription and sale of the Compartment 2 Notes. The Subscription
Agreement entitles the Initial Purchasers to terminate it in certain circumstances prior to the issue of,
and payment for, the Compartment 2 Notes.
Selling Restrictions
Austria
The Initial Purchasers have represented and agreed that they will only offer Compartment 2 Notes in
the Republic of Austria in compliance with the provisions of the Austrian Capital Markets Act
(Kapitalmarktgesetz (KMG)), Federal Law Gazette 1991/625 as amended, and any other laws
applicable in Republic of Austria governing the offer and sale of the Compartment 2 Notes in the
Republic of Austria. The Initial Purchasers have acknowledged that the Offering Circular is not a
prospectus within the meaning of the KMG and it is not a public offering within the meaning of Article
1(1)(1) KMG. Compartment 2 Notes have not been offered or sold and will not be offered or sold to (i)
persons other than institutional investors as a limited group of persons within the scope of their trade or
business (Article 3(1)(11) KMG) and/or (ii) more than 250 persons who have been identified prior to
the offering.
Belgium
The Initial Purchasers have acknowledged and agreed that the issue of the Compartment 2 Notes is not
organised or intended as a public offering in Belgium and that the Belgian Banking, Finance and
Insurance Commission (Commissie voor het Bank-, Financie- en Assurantiewezen / Commission
Bancaire Financière et des Assurances) has not reviewed or approved this document or any other
document related to the issue of the Compartment 2 Notes and has not recommended or endorsed the
purchase of the Compartment 2 Notes. The Initial Purchasers have agreed that they will not (a)
distribute either this document or any other document related to the issue of the Compartment 2 Notes
to the public in Belgium, (b) publicly offer the Compartment 2 Notes for sale in Belgium, (c) take any
steps that would constitute or result in a public offering in Belgium as defined in the Royal Decree
dated 7 July 1999 on the public character of financial transactions or (d) sell or offer for sale any
Compartment 2 Notes to consumers as such term is defined in the Law dated 14 July 1991 on
commercial practices and the information and protection of consumers.
Denmark
The Initial Purchasers have acknowledged and agreed that they will not offer or sell, directly or
indirectly, the Compartment 2 Notes in Denmark, except in compliance with the Danish Executive
Order No. 166 of 13 March 2003 on the First Public Offer of Certain Securities issued under Chapter
12 of the Danish Act on Trading in Securities. Accordingly, the Initial Purchasers have agreed neither
to make this Offering Circular available nor to otherwise market or offer the Compartment 2 Notes for
sale in Denmark other than in the circumstances which are not deemed an offer to the public in
Denmark.
Finland
The Initial Purchasers have represented and agreed that they will not publicly offer the Compartment 2
Notes or bring the Compartment 2 Notes into general circulation in the Republic of Finland other than
in compliance with all applicable provisions of the laws of the Republic of Finland and especially in
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compliance with the Finnish Securities Market Act (1989/495), as amended, and any regulation made
thereunder, as supplemented and amended from time to time.
The Initial Purchasers have represented and agreed that they will only offer or sell Compartment 2
Notes issued by the Issuer directly or indirectly in Finland or to residents of Finland in accordance with
the Finnish Securities Market Act (1989/495), as amended, and the rules and regulations of the Finnish
Financial Supervision Authority and the Ministry of Finance (if applicable).
France
The Initial Purchasers have acknowledged and agreed that, in France, they will not directly or
indirectly offer or sell the Compartment 2 Notes to the public, and offers and sales by it of the
Compartment 2 Notes will only be made in France to qualified investors provided that such investors
act on their own accounts, in accordance with Article L411-2 of the Code Monétaire et Financier, as
amended, and Décret no. 98-880 dated October 1, 1998, as amended. Accordingly, the Offering
Circular has not been submitted to the Autorité des Marchés Financiers. The Initial Purchasers have
agreed that they will distribute neither the Offering Circular nor any other offering material to the
public in France.
Germany
The Initial Purchasers have agreed to comply with the following selling restrictions applicable to The
Federal Republic of Germany.
Pursuant to the Subscription Agreement, the Initial Purchasers have agreed that they shall not offer or
sell the Compartment 2 Notes in the Federal Republic of Germany in such a manner as to result in the
Issuer being subject to licence requirements under the German Banking Act or being subject to
regulation under the German Investment Act and other than in compliance with the restrictions
contained in the German Securities Prospectus Act (Wertpapieverkaufsprospektgesetz), the German
Investment Act (Investmentgesetz), respectively, and any other laws and regulations applicable in the
Federal Republic of Germany governing the issue, the offering and the sale of securities.
The Compartment 2 Notes may neither be nor intended to be distributed by way of public offering,
public advertisement or in a similar manner within the meaning of section 1 of the German Securities
Prospectus Act and sections 1, 2 (11) of the German Investment Act nor shall the distribution of this
Prospectus or any other document relating to the Compartment 2 Notes constitute such public offer. In
addition, the Initial Purchasers have agreed that they have offered, sold or advertised and that they will
offer, sell or advertise the Compartment 2 Notes only to permitted institutional investors
("Institutional Investors") within the meaning of the leaflet of the German Federal Financial
Supervisory Agency (Bundesanstalt für Finanzdienstleistungsaufsicht – BaFin) dated April 2005 in the
Federal Republic of Germany and this Prospectus may not be passed on to any other person or entity in
the Federal Republic of Germany. Furthermore, each subsequent transferee/purchaser of the
Compartment 2 Notes will be deemed to represent that if it is a person or entity in the Federal Republic
of Germany it is an Institutional Investor and to agree not to offer, sell or advertise the Compartment 2
Notes to any person or entity in the Federal Republic of Germany who is not an Institutional Investor.
The distribution of the Compartment 2 Notes has not been notified and the Compartment 2 Notes are
not registered or authorised for public distribution in the Federal Republic of Germany under the
Investment Act. This Prospectus has not been filed or deposited with the German Federal Financial
Supervisory Agency.
Prospective German investors in the Compartment 2 Notes are urged to seek independent tax advice
and to consult their professional advisors as to the legal and tax consequences that may arise from the
application of the German Investment Tax Act to the Compartment 2 Notes and neither the Issuer (nor
the Initial Purchaser) accepts any responsibility in respect of the German tax position of the
Compartment 2 Notes.
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Ireland
To the extent applicable, the issue of the Compartment 2 Notes shall not be underwritten, nor shall the
Compartment 2 Notes be placed otherwise than in conformity with the provisions of the Irish
Investment Intermediaries Act, 1995 (as amended), including, without limitation, Sections 9, 23
(including any advertising restrictions made thereunder) and Section 37 (including any codes of
conduct issued thereunder) the provisions of the Irish Investor Compensation Act, 1998, including,
without limitation, Section 21.
Anything done in or through Ireland in connection with the Compartment 2 Notes will be done in
accordance with the provisions of the Irish Market Abuse (Directive 2003/6/EC) Regulations 2005 and
any rules issued by the Irish Financial Services Regulatory Authority pursuant thereto.
Italy
No action has or will be taken which would allow an offering (nor a "sollecitazione all'investimento")
of the Compartment 2 Notes to the public in the Republic of Italy unless in compliance with the
relevant Italian securities, tax and other applicable laws and regulations. Accordingly, the
Compartment 2 Notes may not be offered, sold or delivered and neither this document nor any other
offering material relating to the Compartment 2 Notes may be distributed or made available to the
public in the Republic of Italy. Individual sales of the Compartment 2 Notes to any persons in the
Republic of Italy may only be made in accordance with Italian securities, tax and other applicable laws
and regulations.
Neither this document nor any other information supplied in connection with the issue of the
Compartment 2 Notes should be considered as a recommendation or constituting an invitation or offer
by the Issuer or the Initial Purchasers that any recipient of this Offering Circular, or of any other
information supplied in connection with the issue of the Compartment 2 Notes, should purchase any of
the Compartment 2 Notes. Each investor contemplating purchasing any of the Compartment 2 Notes
must make its own independent investigation and appraisal of the financial condition and affairs of the
Issuer and the Portfolio Companies.
Jersey
The Initial Purchasers have acknowledged and agreed that that they have not offered or sold, and will
not offer or sell, the Compartment 2 Notes to any person (other than financial institutions in the
ordinary course of business) resident for income tax purposes in Jersey.
Luxembourg
The Initial Purchasers have acknowledged and agreed that they have not and will not make any public
offerings of the Compartment 2 Notes in or from Luxembourg unless the requirements of Luxembourg
concerning public offerings of securities have been complied with, and that they neither have nor will
distribute to the public or publish any advertisement or document or other material in Luxembourg.
The Netherlands
The Initial Purchasers have acknowledged and agreed that they will not offer or sell, transfer or deliver
in or from the Netherlands, the Compartment 2 Notes, as part of their initial distribution, or at any time
thereafter, directly or indirectly, other than to individuals or legal entities in the Netherlands who or
which trade or invest in securities in the conduct of a profession or trade within the meaning of section
2 of the exemption regulation to the Netherlands Securities Market Supervision Act 1995, as amended
from time to time, (Vrijstellingsregeling Wet toezicht effectenverkeer 1995), which includes banks,
securities firms, insurance companies, pension funds, investment institutions, central governments,
large international and supranational organizations, other institutional investors and other parties,
including treasury departments of commercial enterprises which are regularly active in the financial
markets in a professional manner.
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Portugal
The Offering Circular has not been registered with Comissão do Mercado de Valores Mobiliários
(CMVM), the Portuguese Securities Market Commission, nor any application has been or will be made
to obtain registration of the public offering in Portugal of the Compartment 2 Notes with CMVM.
Consequently, the Initial Purchasers have acknowledged and agreed that they will sell, offer or
distribute the Compartment 2 Notes in Portugal only in compliance with Article 110 of the Portuguese
Securities Code (Código dos Valores Mobiliários or CVM, as approved by the Decree-Law 486/99, of
13th November, and subsequently modified) to Institutional Investors (Credit Institutions, Investment
Firms, Insurance Companies, Collective Investment Schemes and their respective Management
Companies, Pension Funds and their respective Management Companies and other Financial Entities
duly licensed and registered to regularly and professionally invest in Transferable Securities (together
Portuguese Institutional Investors, as defined in Article 30 of CVM)), and accordingly, will distribute
the Offering Circular in Portugal only to Portuguese Institutional Investors and will not, in any
circumstances, allow the Offering Circular, in whole or in part, to be reproduced, redistributed,
published or delivered, or to have their contents disclosed by any means, directly or indirectly, to any
other person. Any action taken contravening the aforementioned restrictions may cause the application
of Portuguese legal provisions governing public offers of securities in Portugal, in particular Articles
109 and 114 of the CVM. For the avoidance of doubt, Madeira and Azores Islands fall within the
jurisdiction of the Republic of Portugal.
Spain
The Offering Circular has not been registered with the Comisión Nacional del Mercado de Valores in
Spain. Consequently, the Initial Purchasers have acknowledged and agreed that they will sell, offer or
distribute the Compartment 2 Notes in Spain only in accordance with the provisions of the Spanish
Securities Market Act (Law 24/1988, of 28 July 1988) and of the Spanish Royal Decree on issues and
public offerings of securities (Royal Decree 291/1992, of 27 March 1992) and only to institutional
investors that carry out investments in securities on a regular and professional basis, such as pension
funds, collective investment institutions, insurance companies, credit entities and securities companies,
which, in turn, will not be able resell the Compartment 2 Notes except to other institutional investors.
Switzerland
The Initial Purchasers have acknowledged and agreed that they will not offer, directly or indirectly, the
Compartment 2 Notes to the public in Switzerland and the Offering Circular does not constitute a
public offering prospectus as that term is understood pursuant to art. 652a or art. 1156 of the Swiss
Federal Code of Obligations (Schweizer Obligationenrecht).
United Kingdom
The Initial Purchasers have represented and agreed that:
(a)
they have only communicated or caused to be communicated and will only communicate or
cause to be communicated an invitation or inducement to engage in investment activity
(within the meaning of Section 21 of the FSMA) received by them in connection with the
issue or sale of the Compartment 2 Notes in circumstances in which Section 21(1) of the
FSMA does not apply to the Issuer; and
(b)
they have complied and will comply with all applicable provisions of the FSMA with respect
to anything done by them in relation to the Compartment 2 Notes in, from or otherwise
involving the United Kingdom.
United States
The Compartment 2 Notes have not been and will not be registered under the 1933 Act, and may not be
offered or sold within the United States or to, or for the account or benefit of, U.S. persons except in
certain transactions exempt from the registration requirements of the 1933 Act. Terms used in this
paragraph have the meanings given to them by Regulation S under the 1933 Act.
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The Compartment 2 Notes in bearer form are subject to U.S. tax law requirements and may not be
offered, sold or delivered within the United States or its possessions or to a United States person,
except in certain transactions permitted by U.S. tax regulations. Terms used in this paragraph have the
meanings given to them by the U.S. Internal Revenue Code and regulations thereunder.
The Initial Purchasers have agreed that, except as permitted by the Subscription Agreement, they will
not offer, sell or deliver the Compartment 2 Notes, (i) as part of their distribution at any time and (ii)
otherwise until 40 days after the later of the commencement of the offering or the closing date, within
the United States or to, or for the account or benefit of, U.S. persons, and they will have sent to each
dealer to which they sell Compartment 2 Notes during the distribution compliance period, as defined in
Regulation S under the 1933 Act, a confirmation or other notice setting forth the restrictions on offers
and sales of the Compartment 2 Notes within the United States or to, or for the account or benefit of,
U.S. persons.
In addition, until 40 days after the commencement of the offering, an offer or sale of Compartment 2
Notes within the United States by a dealer that is not participating in the offering may violate the
registration requirements of the 1933 Act.
General
The Initial Purchasers have acknowledged and agreed that:
(a)
no action has been or will be taken in any jurisdiction by them that would permit a public
offering of the Compartment 2 Notes, or public distribution of the Offering Circular or any
other offering or publicity material relating to the Compartment 2 Notes, in any country or
jurisdiction where action for that purpose is required;
(b)
they will comply, to the best of their knowledge and belief, with all applicable laws and
regulations in each jurisdiction in which they acquire, offer, sell or deliver the Compartment 2
Notes or have in their possession or distribute the Offering Circular or any such other material,
in all cases at their own expense;
(c)
they will have any permission required by them for the acquisition, offer, sale or delivery by
them of the Compartment 2 Notes under the laws and regulations in force in any jurisdiction
to which they are subject or in or from which they make any acquisition, offer, sale or
delivery; and
(d)
they are authorised to make any representation or use any information in connection with the
issue, subscription and sale of the Compartment 2 Notes as contained in the Offering Circular.
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GENERAL INFORMATION
(1)
The total expenses related to the admission to trading on the Irish Stock Exchange will be
approximately €5,532.40.
(2)
Application will be made to the Irish Stock Exchange list to admit the Compartment 2 Notes
to the Official List. In connection with the application to list the Compartment 2 Notes on the
official list of the Irish Stock Exchange, copies of the Memorandum and Articles of
Association of the Issuer and a legal notice relating to the issue of the Compartment 2 Notes
will be filed with the Registrar of Companies in Ireland where such documents may be
examined and copies obtained upon request.
(3)
The Issuer has obtained all necessary consents, approvals and authorisations in Luxembourg
in connection with the issue and performance of the Compartment 2 Notes. The issue of the
Compartment 2 Notes was authorised by a resolution of the Board of Directors of the Issuer
on 13 April 2006.
(4)
For fourteen calendar days following the date of the final Offering Circular, copies of the
Issuer's Memorandum and Articles of Association, and the resolutions of the Board of
Directors of the Issuer authorising the issue of the Compartment 2 Notes will be available for
inspection (in hard copy and in electronic format) at the office of the Irish Paying Agent, and
at the offices of the Issuer and, during the term of the Compartment 2 Notes, at the office of
the Trustee.
(5)
According to the rules and regulations of the Irish Stock Exchange, any Compartment 2 Note
listed on the Irish Stock Exchange must be freely transferable.
(6)
The Compartment 2 Notes have been accepted for clearance and settlement through Euroclear
and Clearstream Luxembourg under the following Common Codes and have been assigned
the following ISINs:
Common Code
Class A Notes
Class B Notes
Junior Notes
25129288
25129326
25129385
ISIN
XS50251292883
XS50251293261
XS50251293857
(7)
All Compartment 2 Notes will carry a legend to the following effect "Any United States
person who holds this obligation will be subject to limitations under the United States income
tax laws, including the limitations provided in sections 165(j) and 1287(a) of the Internal
Revenue Code". The sections referred to in such legend provide that United States persons,
with certain exceptions, will not be entitled to deduct any loss, and will not be entitled to
capital gains treatment with respect to any gain, realised on any sale, exchange or redemption
of Notes.
(8)
The Issuer's first financial statements for the period from 12 July 2005, the date of the Issuer's
incorporation, until 31 December 2005 will be prepared on or around 30 April 2006.
(9)
The Issuer has not been involved in any legal or arbitration proceedings relating to claims of
amounts which are material in the context of the issue of the Compartment 2 Notes nor, so far
as the Issuer is aware, are any such proceedings pending or threatened.
(10)
There has been no material adverse change in the financial position of the Issuer since12 July
2005, the date of its incorporation.
(11)
Copies of the respective latest audited annual financial statement of the Issuer will be
available free of charge at the specified offices of the Agents during normal business hours for
as long as any of the Compartment 2 Notes are outstanding. The Issuer will not publish
interim financial statements. Copies of the following documents will be available for
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inspection (in hard copy and in electronic format) at the specified offices of the Irish Paying
Agent during normal business hours for as long as any of the Compartment 2 Notes are
outstanding: the Trust Deed, the Cash Administration Agreement, the Investment Advisory
Agreement, the Recovery Management Agreement, the Swap Agreement, the Asset Sale and
Transfer Agreement, the Paying Agency Agreement and the Memorandum and Articles of
Association of the Issuer.
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INDEX OF DEFINED TERMS
Page
1933 Act........................................................................................................................................... xi
Account Bank ....................................................................................................................... 18, 49, 75
Accounts..................................................................................................................................... 18, 49
Accrual Period ............................................................................................................................ 21, 49
Accrued Interest..............................................................................................................................172
Actual/Actual ISMA Day Count Fraction ..........................................................................................49
Administrative Expenses............................................................................................................. 27, 49
Administrative Expenses Cap...................................................................................................... 28, 50
Advance Repayment Claims .............................................................................................................50
Advances......................................................................................................................................1, 50
Agent.......................................................................................................................................... 28, 50
Agents .................................................................................................................................. 18, 28, 50
Agreement ......................................................................................................................................106
Asset Sale and Transfer Agreement ...............................................................................................9, 50
Available Distribution Funds....................................................................................................... 28, 50
Beneficial Owner ..............................................................................................................................86
Book Entry Interest ...........................................................................................................................85
Business Day ............................................................................................................................ 50, 107
Calculation Agent ................................................................................................................. 18, 50, 75
Capital Payment............................................................................................................................1, 50
Cash Administration Agreement.................................................................................................. 18, 50
Cash Administrator ................................................................................................................ iv, 18, 50
Cash Administrator Information .........................................................................................................iv
Class A Amortisation Amount.................................................................................................. i, 51, 65
Class A Amortisation Schedule ......................................................................................................i, 51
Class A Coupon Payments ....................................................................................................... i, 51, 64
Class A Floating Rate .......................................................................................................................21
Class A Margin................................................................................................................................... i
183
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Class A Notes ..................................................................................................................... ii, 7, 51, 59
Class A Swap....................................................................................................................................51
Class B Coupon Payments........................................................................................................ i, 51, 64
Class B Floating Rate........................................................................................................................22
Class B Margin ................................................................................................................................... i
Class B Notes ..................................................................................................................... ii, 7, 51, 59
Class B Swap....................................................................................................................................51
Clearing Systems ........................................................................................................................ 51, 85
Clearstream, Luxembourg .............................................................................................................ii, 51
CMVM...............................................................................................................................................x
Commencement Date............................................................................................................ 9, 88, 106
Compartment 2 .................................................................................................................................51
Compartment 2 Collateral .................................................................................................................51
Compartment 2 Collateral Liquidation Proceeds ................................................................................74
Compartment 2 Noteholder ...............................................................................................................51
Compartment 2 Noteholders............................................................................................................... ii
Compartment 2 Notes ......................................................................................................... ii, 7, 51, 59
Controlling Class ..............................................................................................................................51
Conversion ............................................................................................................................. 1, 51, 64
Corporate Administration Fees.................................................................................................... 28, 51
Coupon Payments .................................................................................................................... i, 52, 65
Coupons ..................................................................................................................................... 52, 59
Custodian ............................................................................................................................. 18, 52, 75
Custody Accounts.............................................................................................................................52
CVM ..................................................................................................................................................x
Definitive Notes.................................................................................................................... 20, 52, 59
Determination Date.......................................................................................................................5, 52
Determination Period ........................................................................................................................52
Direct Participants.............................................................................................................................85
Disbursing Agent ............................................................................................................................173
Downgraded Financing Agreement ...................................................................................................17
184
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Due Date .................................................................................................................................. 95, 113
Due Period.............................................................................................................................. 5, 28, 52
Early Repayment Amount ........................................................................................................... 11, 14
EC Treaty ................................................................................................................................... 21, 52
End Date...................................................................................................................................ii, 9, 52
Entrenched Matter.............................................................................................................................77
EURIBOR ............................................................................................................................... i, 21, 52
EURIBOR Determination Date ................................................................................................... 21, 52
Euro .................................................................................................................................................52
Euroclear ......................................................................................................................................ii, 52
Euro-zone ................................................................................................................................... 21, 52
Event of Default................................................................................................................................72
Events of Default ..............................................................................................................................52
Expenses Reserve ....................................................................................................................... 29, 53
Expenses Reserve Account................................................................................................................53
Expenses Reserve Custody Account ..................................................................................................53
Extraordinary Circumstances Event............................................................................................. 10, 13
Extraordinary Resolution ..................................................................................................................53
Extraordinary Termination ........................................................................................................ 92, 111
Final Redemption Actions.................................................................................................................74
Financing Agreements ..................................................................................................................ii, 53
Fitch .............................................................................................................................................ii, 53
Fitch Level 2 Minimum Rated Entity...............................................................................................133
Fitch Level 3 Minimum Rated Entity...............................................................................................134
Fitch Minimum Rated Entity...........................................................................................................133
Fitch Ratings Non-Collateral Cure Entity ........................................................................................133
Fitch Ratings Non-Collateral Cure Event.........................................................................................133
Fixed Interest Payment Date................................................................................................................9
Fixed Interest Payments .............................................................................................................. 53, 62
Fixed Interest Profit Payments............................................................................................................ ii
Floating Rate Notes........................................................................................................................ ii, 7
185
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Floating Senior Coupon Payments............................................................................................ i, 53, 64
FSMA............................................................................................................................................... xi
GAAP...............................................................................................................................................53
German Withholding Tax..................................................................................................................53
Global Note ...................................................................................................................... ii, 20, 53, 59
Global Notes..................................................................................................................... ii, 20, 53, 59
holder ...............................................................................................................................................51
HSBC Group ..................................................................................................................................167
Immediate Operating Expenses .....................................................................................................5, 53
Indirect Participants ..........................................................................................................................85
Initial Moody's Rating Event...........................................................................................................132
Initial Purchasers ................................................................................................................. iii, 53, 176
Insolvency Event ........................................................................................................................ 10, 13
Institutional Investors...............................................................................................................viii, 177
Interest ..................................................................................................................................... 89, 108
Interest Determination Date...............................................................................................................53
Interest Payment Claims....................................................................................................................53
Interest Payments.................................................................................................................... ii, 53, 63
Investment Advisory Agreement ................................................................................................. 16, 53
Irish Paying Agent ............................................................................................................................18
Issue Date......................................................................................................................................i, 54
Issuer...................................................................................................................................... ii, 54, 59
Issuer Account ..................................................................................................................................54
Issuer Receipts..............................................................................................................................1, 54
Junior Coupon Payments.......................................................................................................... i, 54, 65
Junior Coupon Rate Schedule................................................................................................... i, 54, 65
Junior Notes........................................................................................................................ ii, 7, 54, 59
Junior Notional Amount................................................................................................................ii, 54
Junior Redemption Amount............................................................................................................i, 54
Junior Redemption Amount Schedule.............................................................................................i, 54
KMG .................................................................................................................................................vi
186
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Law ................................................................................................................................................170
Legal Maturity Date.......................................................................................................................i, 54
Lender ..........................................................................................................................................6, 54
Loan Advance............................................................................................................................. 29, 54
Loan Agreement ..................................................................................................................... 6, 29, 54
Luxembourg Pledge Agreements..................................................................................................iii, 54
Maastricht Treaty...............................................................................................................................vi
Maintenance Expenses ................................................................................................................ 29, 54
Make-Whole Amount .......................................................................................................................54
MKMV............................................................................................................................... 17, 39, 139
Monitoring Agent ..................................................................................................................... 96, 115
Moody's........................................................................................................................................ii, 55
Moody's Required Ratings ..............................................................................................................132
Nominal Amount ...................................................................................................................... 87, 106
Notes ................................................................................................................................................. ii
Offer......................................................................................................................................... 87, 106
Offering Circular ............................................................................................................................... ii
Ongoing Recovery Manager Fee ................................................................................................. 29, 55
Ordinary Resolution..........................................................................................................................55
Other Company........................................................................................................................... 55, 76
Outstanding ......................................................................................................................................55
Outstanding Principal Amount .......................................................................................................i, 55
Participants.......................................................................................................................................85
Participation Payment Claims............................................................................................................55
Participation Right .................................................................................................................... 87, 106
Paying Agency Agreement.......................................................................................................... 18, 55
Paying Agents............................................................................................................................. 55, 75
Payment Date .................................................................................................................. i, 55, 90, 108
Payment Date Permitted Investment Proceeds .....................................................................................5
Payment Default ...........................................................................................................................3, 55
Permanent Global Note ..................................................................................................... ii, 20, 55, 59
187
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Permanent Global Notes................................................................................................................ii, 20
Permitted Investments...................................................................................................................5, 55
Portfolio Companies .....................................................................................................................ii, 56
Portfolio Information .........................................................................................................................iv
Portuguese Institutional Investors........................................................................................................x
Principal Custody Account................................................................................................................56
Principal Deficiency......................................................................................................................3, 56
Principal Deficiency Event............................................................................................................3, 56
Principal Deficiency Ledger .................................................................................................... 3, 56, 66
Principal Deficiency Ledger Repayment................................................................................ 33, 56, 67
Principal Paying Agent ......................................................................................................... 18, 56, 75
Priority of Payments ................................................................................................................... 24, 56
Private Portfolio Companies............................................................................................................... ii
Private Portfolio Company.......................................................................................................... 56, 61
Private Portfolio Company Advance........................................................................................ 1, 56, 62
Private Portfolio Company Advance Repayment Claims....................................................................56
probability of default................................................................................................................. 39, 139
Proceedings ......................................................................................................................................79
Process Agent ...................................................................................................................................79
Profit Participation Agreements............................................................................................... ii, 56, 61
Profit Participation Commencement Date.................................................................................... 56, 62
Profit Participation End Date....................................................................................................... 56, 62
Public Portfolio Companies................................................................................................................ ii
Public Portfolio Company........................................................................................................... 57, 62
Public Portfolio Company Advance......................................................................................... 1, 57, 63
Public Portfolio Company Advance Repayment Claims.....................................................................57
Quarterly Payments............................................................................................................................ ii
Rating Agencies............................................................................................................................ii, 57
Rating Requirement ..........................................................................................................................57
Receipts...................................................................................................................................... 57, 59
Recoveries ..........................................................................................................................................2
188
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Recovery Management Agreement.............................................................................................. 17, 57
Recovery Manager.................................................................................................................. v, 17, 57
Recovery Manager Information...........................................................................................................v
Recovery Manager Recoveries Fee.............................................................................................. 29, 57
Reference Banks ......................................................................................................................... 21, 52
Regulation S .....................................................................................................................................83
Relevant Date ...................................................................................................................................57
Residual Term .......................................................................................................................... 95, 114
Scheduled Redemption Date ..........................................................................................................i, 57
Secured Parties .................................................................................................................................57
Senior Notes ....................................................................................................................... ii, 7, 57, 59
Senior Placement Fee.................................................................................................................. 29, 57
Senior Transaction Adviser Fee................................................................................................... 29, 57
Seven-Year Swap Rate.............................................................................................................. 89, 108
shortfall ............................................................................................................................................34
Subordinated Loan Agreements............................................................................................... ii, 57, 62
Subordinated Loan End Date....................................................................................................... 57, 63
Subordinated Loan Start Date...................................................................................................... 57, 63
Subordinated Placement Fee ....................................................................................................... 29, 57
Subscription Agreement............................................................................................................ 58, 176
Subsequent Moody's Rating Event ..................................................................................................132
Swap Agreement...........................................................................................................................2, 58
Swap Claims.....................................................................................................................................58
Swap Counterparty ................................................................................................................ iv, 18, 58
Swap Counterparty Information .........................................................................................................iv
Swap Settlement Payments.......................................................................................................... 30, 58
Temporary Global Note .................................................................................................... ii, 20, 58, 59
Temporary Global Notes ...............................................................................................................ii, 20
Terms and Conditions .......................................................................................................................58
Three Month Period .......................................................................................................... 9, 12, 58, 62
Transaction.........................................................................................................................................1
189
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Transaction Adviser ............................................................................................................... iv, 16, 58
Transaction Adviser Information ........................................................................................................iv
Transaction Documents.....................................................................................................................58
Trinkaus .......................................................................................................................................8, 58
Trust Deed....................................................................................................................................ii, 58
Trustee .........................................................................................................................................ii, 58
Trustee Fees and Expenses.......................................................................................................... 30, 58
Trustee Information ...........................................................................................................................iv
United States Person .........................................................................................................................58
Value Date......................................................................................................................................107
Wind-up Costs ..................................................................................................................................59
Wind-Up Costs .................................................................................................................................30
Withholding Tax Refunds .................................................................................................................59
190
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ISSUER
H.E.A.T Mezzanine S.A.
(a société anonyme incorporated under the laws of Luxembourg having its registered office at 1-7 rue
Nina et Julien Lefèvre, L-1952 Luxembourg, registered with the Luxembourg Trade and Companies
Register under number B-109.738)
Telephone number: +352 471 847701
TRANSACTION ADVISER
RECOVERY MANAGER
HSBC Trinkaus & Burkhardt KGaA
Königsallee 21/23
D-40212 Düsseldorf
Germany
mbb Consult GmbH
Prinzenallee 15
40549 Düsseldorf
Germany
TRUSTEE
CASH ADMINISTRATOR AND
CALCULATION AGENT
BNP Paribas Trust Corporation UK Limited
BNP Paribas Securities Services,
Luxembourg branch
33 rue de Gasperich
Howald-Hesperange
L-2085 Luxembourg
55 Moorgate
London EC2R 6PA
United Kingdom
PRINCIPAL PAYING AGENT,
ACCOUNT BANK AND
CUSTODIAN
SWAP
COUNTERPARTY
IRISH PAYING AGENT
BNP Paribas,
Luxembourg branch
23-25, avenue de la Porte-Neuve
L-2087 Luxembourg
HSBC Bank plc
8 Canada Square
London E14 5HQ
United Kingdom
Custom House Administration &
Corporate Services Limited
25 Eden Quay
Dublin 1
Ireland
LEGAL ADVISERS
To the Initial Purchasers as to
German law
To the Initial Purchasers and the
Trustee as to English law
To the Initial Purchasers as to
Luxembourg law
Latham & Watkins
Maximilianhoefe
Maximilianstrasse 11
Munich 80539
Germany
Ashurst
Broadwalk House
5 Appold Street
London EC2A 2HA
United Kingdom
Bonn Schmitt Steichen
44 rue de la Vallée
L-2661 Luxembourg
LISTING AGENT
AUDITORS OF THE ISSUER
Goodbody Stockbrokers
Ballsbridge Park
Ballsbridge
Dublin 4
PriceWaterhouseCoopers S.à.r.l.
400, route d'Esch
B.P. 1443
L-1014 Luxembourg
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